Carlyle Secured Lending (CGBD) Financials

Carlyle Secured Lending’s recent financial statements show a highly leveraged business with recurring dividend distributions, volatile investment results and a sharp deterioration in earnings during late 2025 and early 2026. The company’s results have been affected by changes in investment valuations and other noncash adjustments, making quarterly revenue and net income notably uneven.

Revenue was generally stronger during 2023 and 2024, with quarterly operating revenue often above $50 million. However, it declined to $31.2 million in Q2 2025 and $24.7 million in Q2 2026. The company recorded a $4.2 million loss attributable to common shareholders in Q1 2026 before returning to $9.2 million of net income in Q2 2026. That recovery was modest compared with the $14.6 million earned in Q2 2025 and the $17.9 million earned in Q2 2024.

The balance sheet expanded substantially in 2025 compared with 2024, but total assets declined from $2.58 billion in Q2 2025 to approximately $2.44 billion in Q2 2026. Long-term debt was $1.29 billion at June 30, 2026, down from $1.39 billion at March 31, 2026, although it remained well above 2024 levels. Common equity also declined to about $1.08 billion, while retained earnings became increasingly negative.

Cash generation has been inconsistent. Operating cash flow was positive in Q1 and Q2 2026, including $73.6 million in Q2, but earlier periods included operating cash outflows of $230.9 million in Q2 2025 and $153.3 million in Q4 2025. Much of the recent operating cash flow was supported by large noncash adjustments rather than reported net income alone. The company continued to pay dividends and repurchase shares while refinancing significant amounts of debt.

• Debt reduction in Q2 2026: Long-term debt declined by roughly $99 million from Q1 2026 to $1.29 billion, supported by a $312.9 million debt repayment partially offset by $231.6 million of new debt issuance.
• Positive recent operating cash flow: Operating cash flow totaled $212.4 million in Q1 2026 and $73.6 million in Q2 2026, a meaningful improvement from the large operating cash outflows reported in Q2 and Q4 2025.
• Q2 earnings recovery: Net income attributable to common shareholders improved from a $4.2 million loss in Q1 2026 to $9.2 million of income in Q2, while operating income increased to $14.3 million.
• Substantial investment liquidity: The Q2 2026 balance sheet reported approximately $2.39 billion of short-term investments, in addition to $48.9 million of cash and equivalents. This provides a significant asset base to support lending and liquidity needs, although the classification should be monitored.
• Regular shareholder distributions: Quarterly dividend payments generally ranged from approximately $22 million to $29 million across the reported periods. This supports income-oriented investors, but the statements alone do not establish whether distributions are fully covered by recurring earnings.
• Share repurchases may support per-share results: The company repurchased $12.5 million of common equity in Q2 2026 and $18.5 million in Q1 2026. Weighted-average basic shares declined from 72.9 million in Q2 2025 to 69.5 million in Q2 2026.
• Multi-year earnings volatility: Quarterly revenue and earnings have fluctuated sharply, including a $15.6 million operating revenue figure and a $10.1 million loss attributable to common shareholders in Q4 2025. This makes recent earnings less predictable.
• Declining equity cushion: Total common equity fell from approximately $1.21 billion in Q1 2025 to $1.08 billion in Q2 2026. Retained earnings also deteriorated from negative $148.9 million in Q1 2023 to negative $252.3 million in Q2 2026.
• High leverage and refinancing exposure: Debt remained above $1.2 billion for most of 2025 and 2026, while cash interest payments reached $30.8 million in Q1 2026. The company has repeatedly issued new debt to fund repayments, creating exposure to borrowing costs and capital-market conditions.
• Data quality and valuation caution: Several historical income and cash-flow figures are marked as restated or calculated, and the Q2 2026 balance sheet does not fully reconcile using the displayed standardized totals. Investors should rely on the company’s filed financial statements and supplemental disclosures when evaluating net asset value, dividend coverage and portfolio credit quality.