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Jun 30
Capital Southwest Q1 2026 Earnings Report
Capital Southwest reported its financial results for the first fiscal quarter ended June 30, 2025, highlighting a strengthened balance sheet, reduced risk profile, and increased investment income.
Key Takeaways
Capital Southwest delivered a strong first fiscal quarter, with total investment income rising to $55.9 million and pre-tax net investment income reaching $32.7 million. The company's balance sheet strengthened, marked by a healthy cash position and a notable increase in net assets from operations. Strategic capital raising and a new SBIC license further bolstered its financial position.
Total investment income increased to $55.9 million, up from $52.4 million in the prior quarter, driven by higher cash interest income.
Pre-tax net investment income rose to $32.7 million, or $0.61 per share, reflecting improved operational efficiency.
Net assets from operations significantly increased to $27.0 million, compared to $17.6 million in the prior quarter.
The company maintained a strong liquidity position with $46.9 million in cash and cash equivalents and a regulatory debt to equity ratio of 0.82 to 1.
Capital Southwest
Capital Southwest
Capital Southwest Revenue by Segment
Revenue by Segment
Non-control/Non-affiliate Revenue
CapyFin.comAffiliate Investments Revenue
CapyFin.comControl Investments Revenue
CapyFin.comPIK Non-control/Non-affiliate Revenue
CapyFin.comPIK Affiliate Investments Revenue
CapyFin.comPIK Control Investments Revenue
CapyFin.comDividend Non-control/Non-affiliate Revenue
CapyFin.comDividend Affiliate Investments Revenue
CapyFin.comDividend Control Investments Revenue
CapyFin.comFee Non-control/Non-affiliate Revenue
CapyFin.comFee Affiliate Investments Revenue
CapyFin.comFee Control Investments Revenue
CapyFin.comOther Income Revenue
CapyFin.com Forward Guidance
Capital Southwest anticipates increased origination activity in the September quarter and has announced a shift to monthly regular dividend payments, starting in July. The company also plans to continue efficient equity capital raising and leverage its recently increased Corporate Credit Facility and new SBIC license.
Positive Outlook
- Expectation of significant increase in deal flow and origination activity in the September quarter.
- Transition to monthly regular dividend payments starting in July, a shareholder-friendly initiative.
- Continued efficient equity capital raising, with approximately $42 million raised through the Equity ATM Program.
- Increased commitments on the Corporate Credit Facility by $25 million to $510 million.
- Received a second SBIC license from the SBA, enhancing leverage capacity.
Challenges Ahead
- No specific negative forward guidance was provided in the report.
- No specific negative forward guidance was provided in the report.
- No specific negative forward guidance was provided in the report.
- No specific negative forward guidance was provided in the report.
- No specific negative forward guidance was provided in the report.