Key Highlights

• OCSL's total distribution is $0.33 per share, comprising a $0.30 base and $0.03 supplemental component, trading with a September 15, 2026 record date, payable September 30.

• Third fiscal-quarter adjusted net Investment income was $32.2 million, or $0.37 per share, down from $33.7 million, or $0.38 per share, in the prior quarter.

• Non-accrual investments declined to 1.8% of the Debt portfolio at fair value, down from 2.6% in the prior quarter, following the exit of five non-accrual positions in the last two quarters.

• Net asset value was stable at $15.70 per share compared with $15.69 at March 31, with net Leverage of 1.02x, below the midpoint of the company's target range.

Oaktree Specialty Lending's (NASDAQ:OCSL) $0.33 total quarterly distribution trades with a September 15 Record Date and September 30 payment date. CEO Armen Panossian said the company was "pleased with the progress we made in reducing our non-accrual investments," with the metric falling to 1.8% of the debt portfolio at Fair Value from 2.6% in the prior quarter.

Dividend Program and Shareholder Returns

OCSL's board declared a total cash Dividend of $0.33 per share for the quarter, composed of a $0.30 base dividend and a $0.03 supplemental dividend, payable September 30 to shareholders of record September 15. The base dividend annualizes to $1.20 per share, while the supplemental component depends on distributable Earnings capacity and has varied over recent quarters rather than remaining fixed; adjusted NII of $0.37 per share fully covered the combined $0.33 payout this quarter, a coverage Margin the company has maintained even as base rates have pressured floating-rate portfolio yields industry-wide.

About the Company

Oaktree Specialty Lending is a Business Development Company managed by an affiliate of Oaktree Capital Management, providing financing to middle-market companies through senior secured loans, other debt instruments and equity-related investments.

Financial Performance Behind the Payout

OCSL reported third fiscal-quarter total investment income of $69.4 million, or $0.79 per share, compared with $70.4 million and $0.80 in the second fiscal quarter. Adjusted total investment income was $69.2 million, or $0.79 per share. Net investment income was $32.5 million, and adjusted net investment income was $32.2 million, or $0.37 per share, down from $33.7 million, or $0.38 per share, which management attributed to a lower average portfolio balance and a decrease in non-recurring income. Net asset value was $15.70 per share, compared with $15.69 at March 31. Net leverage was approximately 1.02x, down from 1.04x. Liquidity was nearly $700 million, including $40 million of cash and $659 million of undrawn credit-facility capacity.

Credit Quality and New Investment Activity

Non-accrual investments fell to 1.8% of the total debt portfolio at fair value, down 80 basis points sequentially and 140 basis points year over year, which the company attributed to five non-accrual exits over the last two quarters, including Thrasio repaying over 80% of its loans with the remaining position returned to accrual status. New investment commitments were $206 million, stable compared with $204 million in the prior quarter, with new debt investments carrying a weighted average Yield of 10.0%, up from 9.2%.

Outlook

The improvement in non-accruals to 1.8% from 3.2% a year earlier, combined with the exit of five positions in two quarters, sets a lower baseline for Credit costs heading into the next quarter. Whether new-investment yields of 10.0% can be sustained as base rates evolve is the more relevant variable for NII trends than any single quarter's supplemental-dividend level.