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FS KKR Capital Corp. Fourth Quarter and Full Year 2024 Results

FS KKR Capital Corp. (NYSE: FSK), a significant player in the business development sector, recently shared its financial and operational outcomes for the fourth quarter and full fiscal year ending December 31, 2024. The announcement, made on February 26, 2025, highlighted a Q1 2025 distribution declaration of $0.70 per share. This step underlines the company's persistent strategy in delivering value to its shareholders amidst a competitive market environment.

Financial Overview for Q4 2024

The key performance metrics for the fourth quarter include:

• - Net Investment Income: $0.61 per share, showing a decline from $0.77 per share in Q3 2024.
• - Adjusted Net Investment Income: $0.66 per share, compared to $0.74 per share in the previous quarter.
• - Net Asset Value: $23.64 per share, slightly dipping from $23.82 per share in September 2024 and $24.46 per share compared to the same quarter last year.
• - Earnings Per Share: $0.52, down from $0.57 in the previous quarter.

Additionally, the ratio of net debt to equity was reported at 104%, a decrease from 109% in Q3 2024. The company executed purchases totaling $891 million against $1,462 million in sales and repayments, emphasizing a focused strategy on maintaining portfolio stability while managing investments cautiously during fluctuating market conditions.

Year-End Financial Highlights

In a broader context, for the full year ending December 31, 2024, FSK reported the following:

• - Net Investment Income: $2.90 per share, down from $3.18 in 2023.
• - Adjusted Net Investment Income: $2.88 per share, compared to $3.11 in the prior year.
• - Total Realized and Unrealized Loss: $0.81 per share, reflecting a notable change compared to a loss of $0.70 per share in the previous year.
• - Throughout the year, the total cash distributions to shareholders equated to $2.90 per share, reinforcing FSK's commitment to returning capital to investors.

In a statement, Michael C. Forman, Chairman and CEO, expressed satisfaction with the company’s robust performance in the fourth quarter and emphasized FSK's disciplined approach to capital deployment and the strength derived from a well-diversified capital structure. He noted the availability of $4.8 billion in liquidity, which positions FSK favorably as market activity continues to strengthen.

Q1 2025 Distribution Details

The board of directors declared a distribution amounting to $0.70 per share for the first quarter of 2025. This distribution will consist of a base amount of $0.64 and a supplemental component of $0.06, set to be paid on or about April 2, 2025. Eligibility for this distribution requires being a stockholder by the close of business on March 19, 2025.

Portfolio Composition and Market Conditions

As of the year's end, FSK's portfolio valued $13.5 billion predominantly comprised senior secured securities, accounting for approximately 63.8% of total investments. The weighted average annual yield on accruing debt investments dropped slightly to 11.3%, reflecting market rate changes. The company aims to navigate the economic landscape with strategic asset allocation and enhanced focus on credit solutions for private middle-market U.S. companies.

FSK's diversifying portfolio consists of investments with varying yield types and market approaches:

• - 65.8% in variable rate debt investments
• - 9.5% in fixed-rate debt investments

Moreover, 75% of their total debt, amounting to $7.4 billion, is classified as unsecured. This solidified financial positioning allows FSK the agility to adapt amid evolving economic environments while meeting stakeholder expectations.

Conclusion
FS KKR Capital Corp.'s recent report exhibits its resilience and strategic acumen in managing investments, showcasing a commitment to shareholder returns even in challenging market conditions. As the company prepares to announce its Q1 results, it remains firmly focused on capitalizing on opportunities in the private credit market, demonstrating readiness for the year ahead.