Net Asset Value of $15.54 Per Share
HOUSTON, Nov. 13, 2025 /PRNewswire/ -- MSC Income Fund, Inc. (NYSE:MSIF) ("MSC Income" or the "Fund") is pleased to announce its financial results for the third quarter ended September 30, 2025.
Third Quarter 2025 Highlights
Net investment income ("NII"), including excise tax and NII related income taxes, of $16.6 million, or $0.35 per share
NII before taxes(1) of $17.0 million, or $0.36 per share
Total investment income of $35.4 million
Net increase in net assets resulting from operations of $26.5 million, or $0.56 per share
Return on equity(2) of 14.6% on an annualized basis for the quarter and 11.6% for the trailing twelve-month period ended September 30, 2025
Net asset value of $15.54 per share as of September 30, 2025
Declared a regular quarterly dividend of $0.35 per share and a supplemental quarterly dividend of $0.01 per share, both payable in the fourth quarter of 2025, resulting in total dividends declared in the third quarter of 2025 of $0.36 per share
Completed $74.6 million in total private loan portfolio investments, which after aggregate repayments of debt investments and a decrease in cost basis due to realized losses resulted in a net decrease of $6.7 million in the total cost basis of the private loan investment portfolio
Completed $6.0 million in total lower middle market ("LMM") portfolio follow-on investments, which after aggregate repayments of debt investments, return of invested equity capital and a decrease in cost basis due to a realized loss resulted in a net decrease of $2.6 million in the total cost basis of the LMM investment portfolio
In commenting on the Fund's operating results for the third quarter of 2025, Dwayne L. Hyzak, MSC Income's Chief Executive Officer, stated, "We are pleased with the Fund's performance in the third quarter, which resulted in an annualized return on equity of 14.6% and favorable net investment income. We believe that the quality of the Fund's existing investment portfolio, combined with the Fund's existing liquidity, near-term expanded regulatory leverage capacity which will become effective for the Fund at the end of January 2026 and current attractive pipeline of new private loan investment opportunities provide the opportunity for increased net investment income and shareholder dividends as we work to enhance the Fund's investment portfolio over the next several quarters."
Third Quarter 2025 Operating Results(3)
The following table provides a summary of the Fund's operating results for the third quarter of 2025:
Three Months Ended September 30,
2025
2024
Change ($)
Change (%)
(in thousands, except per share amounts)
Interest income
$ 30,117
$ 30,236
$ (119)
— %
Dividend income
3,652
2,485
1,167
47 %
Fee income
1,598
756
842
111 %
Total investment income
$ 35,367
$ 33,477
$ 1,890
6 %
Net investment income (4)
$ 16,577
$ 12,916
$ 3,661
28 %
Net investment income per share (4)
$ 0.35
$ 0.32
$ 0.03
9 %
Net increase in net assets resulting from operations
$ 26,529
$ 7,371
$ 19,158
260 %
Net increase in net assets resulting from operations per share
$ 0.56
$ 0.18
$ 0.38
211 %
The $1.9 million increase in total investment income in the third quarter of 2025 from the comparable period of the prior year was principally attributable to (i) a $1.2 million increase in dividend income, primarily due to a $0.8 million increase in dividend income from the Fund's LMM portfolio companies, a $0.2 million increase in dividend income from the Fund's other portfolio companies and a $0.2 million increase in dividend income from the Fund's private loan portfolio companies, (ii) a $0.8 million increase in fee income primarily due to a $0.5 million increase from the refinancing and prepayment of debt investments and $0.3 million increase in fees related to increased investment activity. The $1.9 million increase in total investment income in the third quarter of 2025 includes the impact of an increase of $0.9 million in certain income considered less consistent or non-recurring, primarily related to a $0.5 million increase in such fee income and a $0.4 million increase in such interest income from accelerated prepayment, repricing and other activity related to certain investment portfolio debt investments, in each case when compared to the same period in 2024.
Total expenses, net of waivers, decreased by $1.0 million, or 5.0%, to $18.3 million in the third quarter of 2025 from $19.3 million for the same period in 2024. This decrease was principally attributable to (i) a $1.7 million decrease in interest expense and (ii) a $0.5 million decrease in base management fees, partially offset by a $1.2 million increase in incentive fees. The decrease in interest expense is primarily related to a decreased weighted-average interest rate on the Fund's Credit Facilities (as defined in the Liquidity and Capital Resources section below) due to decreases in benchmark index rates and a decrease to the applicable spreads resulting from amendments of the Credit Facilities since the first quarter of 2024, partially offset by an increase in weighted-average outstanding borrowings used to fund the growth of the Fund's investment portfolio. The increase in incentive fees, which is after a $0.2 million voluntary permanent waiver provided by the Fund's investment adviser in the third quarter of 2025, is primarily attributable to an increase in pre-incentive fee NII.
The Fund's ratio of total non-interest operating expenses, excluding incentive fees, as a percentage of quarterly average total assets, or the Operating Expenses to Assets Ratio, decreased to 2.0% on an annualized basis for the third quarter of 2025, from 2.2% for the third quarter of 2024, primarily as a result of the decreased base management fee percentage under the amended advisory agreement effective upon the listing of the Fund's shares of common stock in January 2025.
The $3.7 million increase in NII in the third quarter of 2025 from the comparable period of the prior year was principally attributable to the increase in total investment income and decreased expenses, each as discussed above. NII per share increased by $0.03 per share for the third quarter of 2025, as compared to the third quarter of 2024, to $0.35 per share. The per share increase in NII was after the impact of a 17.8% increase in the weighted-average shares outstanding compared to the third quarter of 2024, primarily due to new shares issued through the Fund's follow-on equity offering in January 2025 and the dividend reinvestment plan. NII on a per share basis in the third quarter of 2025 is also after a net increase of $0.02 per share resulting from an increase in investment income considered less consistent or non-recurring in nature compared to the third quarter of 2024, as discussed above.
The $26.5 million net increase in net assets resulting from operations in the third quarter of 2025 represents a $19.2 million increase from the third quarter of 2024. This increase was primarily the result of a (i) $15.5 million increase in the net fair value change of the Fund's portfolio investments resulting from the net impact of net realized gains/losses and net unrealized appreciation/depreciation, with the increase resulting from a net fair value increase of $11.2 million in the third quarter of 2025 compared to a net fair value decrease of $4.4 million in the prior year and (ii) a $3.7 million increase in NII as discussed above. The $11.2 million net fair value increase in the third quarter of 2025 was the result of net unrealized appreciation (including the reversal of net fair value depreciation in prior periods on the net realized loss in the quarter) of $21.0 million, partially offset by a net realized loss of $9.9 million. The $4.4 million net fair value decrease in the third quarter of 2024 was the result of net unrealized depreciation of $29.7 million, partially offset by a net realized gain of $25.4 million. The $9.9 million net realized loss from investments for the third quarter of 2025 was primarily the result of (i) $8.8 million of realized losses on the restructures of two private loan portfolio investments and (ii) a $2.4 million realized loss on the full exit of a LMM portfolio investment, partially offset by a $1.3 million realized gain on the full exit of a LMM portfolio investment.
The following table provides a summary of the total net unrealized appreciation of $21.0 million for the third quarter of 2025:
Three Months Ended September 30, 2025
Private
Loan
LMM (a)
Middle
Market
Other
Total
(dollars in millions)
Accounting reversals of net unrealized (appreciation) depreciation recognized in prior periods due to net realized(gains / income) losses recognized during the current period
$ 8.0
$ 0.8
$ ,
$ ,
$ 8.8
Net unrealized appreciation (depreciation) relating to portfolioinvestments
4.8
9.7
(2.6)
0.3
12.2
Total net unrealized appreciation (depreciation) relating toportfolio investments
$ 12.8
$ 10.5
$ (2.6)
$ 0.3
$ 21.0
(a)
LMM includes unrealized appreciation on 30 LMM portfolio investments and unrealized depreciation on 13 LMM portfolio investments.
Liquidity and Capital Resources
As of September 30, 2025, the Fund had aggregate liquidity of $183.5 million, including (i) $18.1 million in cash and cash equivalents and (ii) $165.4 million of aggregate unused capacity under the Fund's corporate revolving credit ...
