The following is a summary of the Capital Southwest (CSWC) Q1 2025 Earnings Call Transcript:

Financial Performance:

• Capital Southwest reported pretax net investment income of $0.69 per share, covering both regular and supplemental dividends.

• Dividends increased to $0.58 per share for the regular dividend and $0.06 per share for the supplemental dividend.

• The company raised over $38 million in gross equity proceeds during the quarter and increased its SPV credit facility commitments by $50 million.

• Net investment income after-tax was $28.9 million or $0.63 per share for the quarter.

Business Progress:

• Portfolio activity included $108.1 million in new commitments, with significant deal activity in the lower middle market.

• The company's equity portfolio demonstrated strong returns, including $5.6 million in cash distributions over the past 12 months.

• Capital Southwest continues to focus on first lien senior secured loans, with new portfolio debt originations being 100% first lien senior secured.

Opportunities:

• Healthy deal quality and activity in the lower middle market continues to provide opportunities for robust portfolio growth.

• The company's conservative financial approach and high balance sheet liquidity enable flexibility and growth potential, even in volatile capital markets.

Risks:

• Increased market competition and tightened spreads on quality deals present challenges, though the company continues to source deals with attractive risk-return profiles.

More details: Capital Southwest Corp IR

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