Key Highlights

  • FS KKR Capital's $0.44 quarterly distribution has a Record Date of September 16, 2026, payable October 2, yielding approximately 14.63%, up from $0.42 in the prior quarter.
  • Second-quarter net Investment income was $0.44 per share, up from $0.42 in the first quarter, while adjusted NII was $0.43 per share.
  • NAV declined to $18.30 per share from $18.83, reflecting a $0.56 per share combined realized and unrealized investment loss.
  • Net debt-to-equity fell to approximately 122% from 131% in the prior quarter, alongside continued share repurchases below NAV.

FS KKR Capital's (NYSE:FSK) $0.44 quarterly distribution yields approximately 14.63% and was fully covered by second-quarter net investment income of $0.44 per share, an increase from the $0.42 per share NII reported in the first quarter that supported the higher distribution rate. The company repurchased approximately 3.7 million shares for about $40 million during the quarter under its $300 million authorized buyback program, a mechanism that can increase NAV per remaining share when executed at a discount to book value.

Dividend Program and Shareholder Returns

FSK declared a $0.44 per share common distribution for the third quarter of 2026, payable on or about October 2 to common shareholders of record as of September 16, up from the $0.42 distribution paid for the second quarter. FSK also declared a separate $0.315972 per-share Dividend on its convertible preferred stock for the period June 29 through September 30, payable around September 30 to preferred holders of record September 15.

About the Company

FSK is a Business Development Company specializing in senior-secured loans to private U.S. middle-market businesses, managed through the FS/KKR Advisor platform with access to KKR Credit's sourcing and Underwriting capabilities.

Financial Performance Behind the Payout

FSK produced second-quarter net investment income of $0.44 per share, up from $0.42 in the first quarter, while adjusted NII was $0.43 per share. Total investment income was approximately $290 million. The portfolio had a Fair Value of $11.4 billion across 232 portfolio companies, with 63% in senior-secured securities and approximately 59% in first-lien loans. The weighted-average Yield on accruing Debt investments was 9.8%. NAV declined to $18.30 per share from $18.83, reflecting a $0.56 per share combined realized and unrealized investment loss. Non-accrual investments improved to 3.8% of the portfolio at fair value from 4.2% at March 31.

Leverage Reduction Accompanies Distribution Increase

Net debt-to-equity fell to approximately 122% at quarter-end from 131% at March 31, a reduction management has tied to balance-sheet optimization alongside the higher distribution rate. During June, FSK issued $900 million of 7.5% unsecured notes due 2031 and subsequently swapped the fixed coupon to floating-rate exposure, a transaction distinct from the Leverage reduction itself. The combination of lower net leverage and an NII increase to $0.44 per share accompanied the board's decision to raise the distribution from $0.42 to $0.44 per share.

Outlook

FSK's distribution was covered by net investment income in the second quarter, at a rate the board raised from the prior quarter. Metrics relevant to the payout's context going forward include NAV trends, non-accrual levels, net leverage following the June note issuance, and the pace of further share repurchases under the $300 million authorization.