FS KKR Capital Corp. Reports Financial Results for First Quarter 2025, Distributions Declared
FS KKR Capital Corp. Announces First Quarter 2025 Financial Results
FS KKR Capital Corp. (NYSE: FSK) has recently shared its financial and operating results for the quarter ending on March 31, 2025. The report showcased a promising trajectory for the company, particularly in terms of its net investment income and distribution plans for the upcoming quarter.
Financial Highlights
For the first quarter of 2025, FS KKR reported a net investment income of $0.67 per share, an increase from $0.61 per share recorded in the previous quarter (December 31, 2024). Notably, the adjusted net investment income was reported at $0.65 per share, slightly down from $0.66 in the preceding quarter. As of March 31, 2025, the company's net asset value stood at $23.37 per share, down from $23.64 at the end of 2024.
The financial dynamics reveal that FS KKR experienced a total net realized and unrealized loss of $0.24 per share, compared to a lesser loss of $0.09 per share in the previous quarter. Additionally, the earnings per share were reported at $0.43, reflecting a decline from $0.52 in the last quarter of 2024.
In another significant announcement, FS KKR's board of directors declared a quarterly distribution of $0.70 per share, which is anticipated to comprise a base distribution of $0.64 and a supplemental distribution of $0.06. This amount will be payable to shareholders of record by July 2, 2025, after the record date of June 18, 2025.
Investment Performance
As of the end of the first quarter, FS KKR's total fair value of investments was reported at $14.1 billion. Approximately 63.3% of these investments were allocated to senior secured securities, articulating the company's investment strategy amid evolving market conditions. The weighted average annual yield on accruing debt investments stood at 11.0%, slightly down from 11.3% at the end of 2024. This measurement elucidates the company's solid yet adjusting approach to generating consistent returns for its stakeholders.
The concentration in the largest ten portfolio companies rose, establishing exposure at 20%, marginally down from 21% in the previous quarter. Investment status adjustments indicate that 2.1% of the total investment portfolio was on a non-accrual basis, highlighting a slight improvement from 2.2% observed earlier.
Leverage and Liquidity Analysis
As of March 31, 2025, FS KKR maintained a net debt-to-equity ratio of 114%. This translates to about $8.0 billion in total debt, which includes approximately $472 million in cash and cash equivalents. This liquidity positioning showcases FS KKR's resilience and capacity to navigate the ongoing economic variability effectively.
Moreover, the effective interest rate for FS KKR's debt portfolio was recorded at 5.48%, indicating a manageable cost of funding, which bodes well for future profitability.
Insights from Leadership
Michael C. Forman, Chairman and CEO of FS KKR, expressed satisfaction regarding the company’s strong start to 2025, emphasizing the generation of $0.65 per share in adjusted net investment income. He appreciated the origination of approximately $2.0 billion in new investments, which helped foster stability in their distribution rates amid volatile market conditions.
Looking Forward
FS KKR is poised for an upcoming conference call to discuss its first-quarter results on May 8, 2025. This call will invite all interested participants to engage and join via a live webcast, detailing the company's financial strategies and future outlook. Stakeholders and analysts looking for additional insights may also access an investor presentation through the FS KKR website, underscoring ongoing transparency and commitment to shareholder engagement.
In summary, FS KKR Capital Corp. continues to showcase its financial resilience and strategic investment approach, even amidst fluctuating market conditions. Investors and stakeholders alike are encouraged to stay engaged through the upcoming conference call for further insights on the company’s performance and strategies moving forward.