FS KKR Capital Announces Quarterly Distribution and Provides Business Update

FS KKR Capital US3026352068

Shareholders of FS KKR Capital Corp. are set to receive another quarterly cash distribution. The business development company has declared a payment of $0.70 per share for the fourth quarter of 2025. This distribution comprises a base dividend of $0.64 supplemented by an extra $0.06. The payment is scheduled for December 17 to shareholders of record as of December 3. Such regular payouts form a central pillar of the firm's financial policy.

The company's most recent operational figures, covering the third quarter of 2025, indicated a period of stabilization. Adjusted net investment income reached $0.57 per share. Meanwhile, the net asset value (NAV) per share experienced a modest increase to $21.99.

Key portfolio metrics as of September 30 included:
* A total fair value of $13.4 billion.
* An allocation of 63.2% to first lien senior secured loans.
* A weighted average annualized yield on accruing debt investments of 10.6%.

Strategic Financing and Portfolio Growth

FS KKR Capital is actively expanding and refining its credit portfolio. A recent development is the presale rating for "KKR-FSK CLO 3 LLC," a $476.6 million Collateralized Loan Obligation (CLO) managed by the firm. This portfolio is designed to consist of at least 90% senior secured loans, cash, and other qualifying assets.

Furthermore, in September 2025, the company issued $400 million in unsecured notes. These notes carry a coupon rate of 6.125% and are due in 2031. Management stated the proceeds are intended for general corporate purposes, which may include repaying existing debt.

Navigating Market Volatility

The preceding quarter presented some challenges, highlighting the inherent volatility in the BDC sector. For Q2 2025, FS KKR Capital's results fell short of analyst forecasts. Earnings per share came in at $0.60, missing the $0.63 estimate, while revenue of $398 million was slightly below expectations. This performance contributed to a 6.2% decline in the NAV per share to $21.93 at that time. In reaction, the stock dropped more than seven percent in pre-market trading.

Shareholder Return Outlook for 2026

Despite quarterly fluctuations, the board has outlined a clear distribution plan for the coming year. For 2026, the company is targeting quarterly distributions that, based on the current NAV, would generate an annualized yield of approximately 10%. This target aligns with long-term return expectations for the BDC industry and reinforces its commitment to delivering attractive income to investors.