At quarter end, Capital Southwest’s total investment portfolio reached $2.0 billion, with the credit portfolio comprising $1.8 billion (99% first-lien senior secured debt) and the equity portfolio at $182.7 million. During the quarter, the company committed $241.4 million in new senior secured debt investments and $2.6 million in equity co-investments across 24 portfolio companies. The weighted average yield on debt investments stood at 11.3%, and current non-accruals represented just 1.5% of the total portfolio by fair value, underscoring the senior-secured nature and disciplined underwriting of its credit exposure.

Capital Southwest generated pre-tax net investment income of $34.6 million, or $0.60 per weighted average common share, matching the prior quarter’s results. For the quarter, the board declared regular monthly dividends of $0.1934 per share for each of October, November and December 2025, plus a supplemental dividend of $0.06 in December, totaling $0.64 per share. Estimated undistributed taxable income stood at $1.02 per share as of December 31, 2025, providing ample coverage for future dividend distributions under the company’s BDC structure.

As of December 31, 2025, Capital Southwest held $42.6 million in unrestricted cash and money market balances and maintained $395.2 million of unused capacity under its corporate and SPV credit facilities. The regulatory debt-to-equity ratio was a conservative 0.89 to 1. Outstanding borrowings included $210 million under the corporate revolver, $104 million under the SPV facility, $224.2 million of convertible notes due 2029, $343.6 million of notes due 2030, and $190.6 million of SBA debentures, reflecting a diversified and staggered debt maturity profile.

Net asset value per share increased to $16.75 from $16.62 in the prior quarter, driven by net appreciation on investments and equity issued at a premium through an Equity ATM program that raised approximately $53 million. Net realized and unrealized depreciation on the portfolio was limited to $1.9 million (0.1% of fair value), with equity investments contributing $9.2 million of gains offset by $8.7 million of debt investment losses. Subsequent to quarter end, the company formed an off-balance-sheet joint venture targeting first-out senior secured debt in the lower middle market, broadening its capital markets reach and fee-earning potential.