8-K
MSC INCOME FUND, INC. (MSIF)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________________________________________________________________
FORM 8-K
__________________________________________________________________________
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of
the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) February 26, 2026
__________________________________________________________________________
MSC Income Fund, Inc.
(Exact name of registrant as specified in its charter)
| Maryland | 814-00939 | 45-3999996 | |||
|---|---|---|---|---|---|
| (State or other jurisdiction of<br><br>incorporation) | (Commission File Number) | (IRS Employer Identification No.) | 1300 Post Oak Boulevard, 8th Floor, Houston, Texas | 77056 | |
| --- | --- | ||||
| (Address of principal executive offices) | (Zip Code) |
Registrant’s telephone number, including area code: (713) 350-6000
Not Applicable
___________________________________________________________________________________
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the
registrant under any of the following provisions:
| o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol | Name of each exchange on which registered |
|---|---|---|
| Common Stock, par value $0.001 per share | MSIF | New York Stock Exchange<br><br>NYSE Texas |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act
of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company o
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition
period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the
Exchange Act. o
Item 2.02Results of Operations and Financial Condition.
On February 26, 2026, the Registrant issued a press release. A copy of such press release is attached hereto as Exhibit 99.1
and is incorporated herein by reference.
The information disclosed under this Item 2.02, including Exhibit 99.1 hereto, is being furnished and shall not be deemed
“filed” for purposes of Section 18 of the Securities Exchange Act of 1934 and shall not be deemed incorporated by
reference into any filing made under the Securities Act of 1933, except as expressly set forth by specific reference in such
filing.
Item 9.01Financial Statements and Exhibits.
(d) Exhibits
| 99.1 | Press release dated February 26, 2026 |
|---|---|
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
| MSC Income Fund, Inc. | ||
|---|---|---|
| Date: February 26, 2026 | By: | /s/ Cory E. Gilbert |
| Name: Cory E. Gilbert | ||
| Title: Chief Financial Officer |
MSIF Earnings Release Q4 25 1
Exhibit 99.1
| NEWS RELEASE |
|---|
| Contacts:<br><br>MSC Income Fund, Inc.<br><br>Dwayne L. Hyzak, CEO, dhyzak@mainstcapital.com<br><br>Cory E. Gilbert, CFO, cgilbert@mainstcapital.com<br><br>713-350-6000<br><br>Dennard Lascar Investor Relations<br><br>Ken Dennard / ken@dennardlascar.com<br><br>Zach Vaughan / zvaughan@dennardlascar.com<br><br>713-529-6600 |
MSC INCOME FUND ANNOUNCES
2025 FOURTH QUARTER AND ANNUAL RESULTS
Fourth Quarter 2025 Net Investment Income of $0.28 Per Share
Fourth Quarter 2025 Adjusted Net Investment Income(1) of $0.34 Per Share
Fourth Quarter 2025 Adjusted Net Investment Income Before Taxes(2) of $0.37 Per Share
Net Asset Value of $15.85 Per Share
HOUSTON, February 26, 2026 – MSC Income Fund, Inc. (NYSE: MSIF) (“MSC Income” or the “Fund”) is
pleased to announce its financial results for the fourth quarter and full year ended December 31, 2025.
Fourth Quarter 2025 Highlights
•Net investment income (“NII”) of $13.1 million, or $0.28 per share, including the impact of the capital gains
incentive fee(3) of $2.8 million, or $0.06 per share, and excise tax and NII related income taxes of $1.3
million, or $0.03 per share
•NII excluding the impact of the capital gains incentive fee,(3) or adjusted net investment income (“ANII”),(1)
of $15.9 million, or $0.34 per share
•ANII excluding the impact of excise tax and NII related income taxes, or ANII before taxes,(2) of $17.2
million, or $0.37 per share
•Total investment income of $34.9 million
•Net increase in net assets resulting from operations of $30.0 million, or $0.64 per share
•Return on equity(4) of 16.3% on an annualized basis
•Net asset value of $15.85 per share as of December 31, 2025, representing an increase of $0.31 per share, or
2.0%, compared to $15.54 per share as of September 30, 2025
•Declared a regular quarterly dividend of $0.35 per share and a supplemental dividend of $0.01 per share,
both payable in the first quarter of 2026, resulting in total dividends declared in the fourth quarter of 2025 of
$0.36 per share
•Completed $100.9 million in total private loan portfolio investments, which after aggregate repayments,
return of invested equity capital and a decrease in cost basis due to realized losses resulted in a net increase
of $57.1 million in the total cost basis of the private loan investment portfolio
•Completed $23.0 million in total lower middle market (“LMM”) portfolio follow-on investments, which after
aggregate repayments, return of invested equity capital and a decrease in cost basis due to realized losses
resulted in a net increase of $14.9 million in the total cost basis of the LMM investment portfolio
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Full Year 2025 Highlights
•NII of $61.8 million, or $1.33 per share, including the impact of the capital gains incentive fee(3) of $2.8
million, or $0.06 per share, and excise tax and NII related income taxes of $3.8 million, or $0.08 per share
•NII excluding the impact of the capital gains incentive fee,(3) or ANII,(1) of $64.5 million, or $1.39 per share
•ANII excluding the impact of excise tax and NII related income taxes, or ANII before taxes,(2) of $68.3
million, or $1.47 per share
•Total investment income of $139.2 million
•Net increase in net assets resulting from operations of $88.7 million, or $1.91 per share
•Return on equity(4) of 12.5%
•Net asset value of $15.85 per share as of December 31, 2025, representing an increase of $0.32 per share, or
2.1%, compared to $15.53 per share as of December 31, 2024
•Declared regular quarterly dividends totaling $1.40 per share and supplemental dividends totaling $0.04 per
share, resulting in total dividends declared of $1.44 per share
•Completed $357.1 million in total private loan portfolio investments, which after aggregate repayments and
sales of debt investments, return of invested equity capital and a decrease in cost basis due to realized losses
resulted in a net increase of $109.6 million in the total cost basis of the private loan investment portfolio
•Completed $53.5 million in total LMM portfolio follow-on investments, which after aggregate repayments,
return of invested equity capital and a decrease in cost basis due to realized losses resulted in a net increase
of $27.1 million in the total cost basis of the LMM investment portfolio
•Further diversified the Fund’s capital structure and enhanced its liquidity position by (i) amending the
Corporate Facility to increase total commitments to $245.0 million (from $165.0 million), increase the
accordion feature to up to a total of $300.0 million and expand and diversify the lender group to seven
participants and (ii) amending the SPV Facility to decrease the interest rate to the applicable Secured
Overnight Financing Rate (“SOFR”) plus 2.20% (from 3.00%), extend the revolving period through February
2029 and extend the final maturity date to February 2030, with the Corporate Facility and SPV Facility each
defined in the Liquidity and Capital Resources section below
•Entered into an amended advisory agreement effective upon the listing of the Fund’s common stock on the
New York Stock Exchange (“NYSE”) in January 2025 (the “MSC Income Listing”) to, among other things,
(i) reduce the annual base management fee payable by the Fund to 1.5% of its average total assets (with
additional future contractual reductions based upon changes to the composition of the Fund’s investment
portfolio), (ii) reduce to 17.5% the subordinated incentive fee on income payable by the Fund, subject to a
50% / 50% catch-up feature, (iii) reduce to 17.5% and reset the incentive fee on cumulative net realized
capital gains payable by the Fund and (iv) establish a cap on the amount of expenses payable by the Fund
relating to certain internal administrative services, which varies based on the value of the Fund’s total assets
In commenting on the Fund’s operating results for the fourth quarter and full year of 2025, Dwayne L. Hyzak,
MSC Income’s Chief Executive Officer, stated, “We are very pleased with the Fund’s performance in the fourth
quarter, which resulted in an annualized return on equity of 16.3%, favorable adjusted net investment income
per share and a significant net increase in the fair value of the Fund’s investments, including the benefits of net
realized gains in both the Fund’s private loan and lower middle market investments, which resulted in a
significant increase in net asset value per share. The Fund also produced favorable investment activity in the
fourth quarter which generated meaningful growth of the Fund’s investment portfolio.”
Mr. Hyzak continued, “After the Fund’s positive performance in the first three quarters of 2025, the Fund’s
strong performance in the fourth quarter resulted in a return on equity of 12.5% for the full year. Based upon the
quality of the Fund’s existing investment portfolio, combined with the Fund’s existing liquidity and expanded
regulatory leverage capacity which became effective for the Fund at the end of January 2026, we remain excited
about our future expectations for the Fund.”
3
Fourth Quarter 2025 Operating Results
The following table provides a summary of the Fund’s operating results for the fourth quarter of 2025:
| Three Months Ended December 31, | ||||
|---|---|---|---|---|
| 2025 | 2024 | Change ($) | Change (%) | |
| (dollars in thousands, except per share amounts) | ||||
| Interest income | $28,860 | $29,662 | $(802) | (3)% |
| Dividend income | 5,308 | 2,731 | 2,577 | 94% |
| Fee income | 748 | 1,062 | (314) | (30)% |
| Total investment income | $34,916 | $33,455 | $1,461 | 4% |
| Net investment income (5) | $13,122 | $13,557 | $(435) | (3)% |
| Net investment income per share (5) | $0.28 | $0.34 | $(0.06) | (18)% |
| Adjusted net investment income (1) | $15,885 | $13,557 | $2,328 | 17% |
| Adjusted net investment income per share (1) | $0.34 | $0.34 | $— | —% |
| Adjusted net investment income before taxes (2) | $17,162 | $14,227 | $2,935 | 21% |
| Adjusted net investment income before taxes per share (2) | $0.37 | $0.35 | $0.02 | 6% |
| Net increase in net assets resulting from operations | $30,035 | $20,462 | $9,573 | 47% |
| Net increase in net assets resulting from operations per share | $0.64 | $0.51 | $0.13 | 25% |
The $1.5 million increase in total investment income in the fourth quarter of 2025 from the comparable period
of the prior year was principally attributable to a $2.6 million increase in dividend income, primarily due to a
$2.5 million increase in dividend income from the Fund’s LMM portfolio companies. The increase was partially
offset by (i) a $0.8 million decrease in interest income, principally attributable to a decrease in interest rates,
primarily resulting from decreases in benchmark index rates on floating rate debt investments, and a larger
negative impact from investments on non-accrual status, partially offset by higher average levels of income
producing investment portfolio debt investments and (ii) a $0.3 million decrease in fee income, principally
attributable to a decrease in fee income from the refinancing and prepayment of debt investments. The $1.5
million increase in total investment income in the fourth quarter of 2025 includes the impact of an increase of
$1.1 million in certain income considered less consistent or non-recurring, primarily related to increases of (i)
$1.2 million in such dividend income and (ii) $0.1 million in such interest income from accelerated prepayment,
repricing and other activity related to certain investment portfolio debt investments, partially offset by a $0.3
million decrease in such fee income, in each case when compared to the same period in 2024.
Total expenses, net of waivers, increased by $1.3 million, or 6.7%, to $20.5 million in the fourth quarter of 2025
from $19.2 million for the same period in 2024. This increase was principally attributable to a $2.8 million
capital gains incentive fee(3) accrued in the fourth quarter of 2025, partially offset by (i) a $1.2 million decrease
in interest expense and (ii) a $0.4 million decrease in base management fees. The capital gains incentive fee(3) is
primarily the result of the significant net fair value appreciation of the Fund’s investments recognized during the
fourth quarter of 2025. The decrease in interest expense is primarily related to a decreased weighted-average
interest rate on the Credit Facilities due to a decrease to the applicable spreads resulting from amendments of
the Credit Facilities since the fourth quarter of 2024 and decreases in benchmark index rates.
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 1.8% on an annualized basis for
the fourth quarter of 2025, from 2.1% for the fourth quarter of 2024, primarily as a result of the decreased base
4
management fee percentage under the amended advisory agreement effective upon the MSC Income Listing in
January 2025.
NII related federal and state income and other tax expenses increased $0.6 million in the fourth quarter of 2025
from the comparable period of the prior year, primarily driven by an increase in taxable NII between the
relevant periods.
The $0.4 million decrease in NII in the fourth quarter of 2025 from the comparable period of the prior year was
principally attributable to increases in (i) total expenses, net of waivers, and (ii) NII related federal and state
income and other tax expenses, partially offset by an increase in total investment income, each as discussed
above. NII on a per share basis decreased by $0.06 per share for the fourth quarter of 2025 as compared to the
fourth quarter of 2024, to $0.28 per share, reflecting the impact of the $0.06 per share capital gains incentive fee
accrual in the fourth quarter of 2025.
The $2.3 million increase in ANII(1) in the fourth quarter of 2025 from the comparable period of the prior year
was principally attributable to the same factors noted above for the change in NII, which include (i) an increase
in total investment income, (ii) a decrease in interest expense and (iii) a decrease in base management fees,
partially offset by an increase in NII related federal and state income and other tax expenses, each as discussed
above, but excluding the impact of the capital gains incentive fee accrual in 2025. ANII(1) on a per share basis
for the fourth quarter of 2025 was consistent with the fourth quarter of 2024 at $0.34 per share.
The per share changes in NII and ANII(1) in the fourth quarter of 2025 from the comparable period of the prior
year include the impact of a 16.6% increase in the weighted-average shares outstanding, primarily due to new
shares issued through the MSC Income Listing and the dividend reinvestment plan, partially offset by shares
repurchased by the Fund. NII and ANII(1) on a per share basis in the fourth quarter of 2025 each include 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 fourth quarter of 2024, as discussed above.
The $30.0 million net increase in net assets resulting from operations in the fourth quarter of 2025 represents a
$9.6 million increase from the fourth quarter of 2024. This increase was primarily the result of a $16.0 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 $17.2 million in the fourth quarter of 2025 compared to a net fair value increase of $1.2
million in the comparable period of the prior year, partially offset by (i) a $6.0 million increase in net tax
provision on the net fair value change of the portfolio investments resulting from a net tax provision of $0.3
million in the fourth quarter of 2025 compared to a net tax benefit of $5.7 million in the comparable period of
the prior year and (ii) a $0.4 million decrease in NII as discussed above. The $17.2 million net fair value
increase in the fourth quarter of 2025 was the result of a net realized gain of $16.6 million and net unrealized
appreciation (including the reversal of net fair value appreciation recognized in prior periods due to the net
realized gain in the quarter) of $0.5 million. The $1.2 million net fair value increase in the fourth quarter of
2024 was the result of net unrealized appreciation of $9.2 million, partially offset by a net realized loss of $8.0
million. The $16.6 million net realized gain from investments for the fourth quarter of 2025 was primarily the
result of (i) $16.1 million of realized gains on the full exits of two private loan portfolio investments and (ii) a
$6.0 million realized gain on the full exit of a LMM portfolio investment, partially offset by (i) a $5.2 million
realized loss on the restructure of a private loan portfolio investment and (ii) a $0.3 million realized loss on the
full exit of a private loan portfolio investment.
5
The following table provides a summary of the total net unrealized appreciation of $0.5 million for the fourth
quarter of 2025:
| Three Months Ended December 31, 2025 | |||||
|---|---|---|---|---|---|
| Private<br><br>Loan | LMM (a) | Middle<br><br>Market | Other | Total | |
| (in millions) | |||||
| Accounting reversals of net unrealized (appreciation)<br><br>depreciation recognized in prior periods due to net realized<br><br>(gains / income) losses recognized during the current period | $(11.0) | $(6.2) | $— | $— | $(17.2) |
| Net unrealized appreciation (depreciation) relating to portfolio<br><br>investments | 8.4 | 12.2 | (3.1) | 0.2 | 17.7 |
| Total net unrealized appreciation (depreciation) relating to<br><br>portfolio investments | $(2.6) | $6.0 | $(3.1) | $0.2 | $0.5 |
(a)Includes unrealized appreciation on 34 LMM portfolio investments and unrealized depreciation on 11 LMM
portfolio investments.
Liquidity and Capital Resources
As of December 31, 2025, the Fund had aggregate liquidity of $112.0 million, including (i) $20.6 million in
cash and cash equivalents and (ii) $91.4 million of aggregate unused capacity under the Fund’s corporate
revolving credit facility (the “Corporate Facility”) and the Fund’s special purpose vehicle revolving credit
facility (the “SPV Facility” and, together with the Corporate Facility, the “Credit Facilities”), which the Fund
maintains to support its investment and operating activities.
Several details regarding the Fund’s capital structure as of December 31, 2025 are as follows:
•The SPV Facility included $300.0 million in total commitments plus an accordion feature that allows the
Fund to request an increase in the total commitments under the facility to up to $450.0 million.
•$244.0 million in outstanding borrowings under the SPV Facility, with an interest rate of 5.9% based on the
applicable SOFR effective for the contractual reset date of January 1, 2026.
•The Corporate Facility included $245.0 million in total commitments from a diversified group of seven
participating lenders, plus an accordion feature that allows the Fund to request an increase in the total
commitments under the facility to up to $300.0 million.
•$209.0 million in outstanding borrowings under the Corporate Facility, with an interest rate of 5.8% based
on the applicable SOFR effective for the contractual reset date of January 1, 2026.
•$150.0 million of unsecured notes outstanding that bear interest at a rate of 4.04% per year (the “Series A
Notes”). The Series A Notes mature on October 30, 2026.
•The Fund maintains an investment grade rating from Kroll Bond Rating Agency, LLC of BBB- with a stable
outlook. Kroll Bond Rating Agency, LLC reaffirmed its rating in October 2025.
•The Fund’s net asset value totaled $738.7 million, or $15.85 per share.
•The Fund’s debt-to-equity ratio was 0.82x as of December 31, 2025, below the Fund’s targeted leverage
range.
•Effective on January 29, 2026, the Fund’s minimum regulatory asset coverage requirement decreased from
200% to 150%.
6
Investment Portfolio Information as of December 31, 2025(6)
The following table provides a summary of the investments in the Fund’s private loan portfolio and LMM
portfolio as of December 31, 2025:
| December 31, 2025 | ||
|---|---|---|
| Private Loan | LMM (a) | |
| (dollars in millions) | ||
| Number of portfolio companies | 81 | 55 |
| Fair value | $809.0 | $487.6 |
| Cost | $821.7 | $384.8 |
| Debt investments as a % of portfolio (at cost) | 92.1% | 70.6% |
| Equity investments as a % of portfolio (at cost) | 7.9% | 29.4% |
| % of debt investments at cost secured by first priority lien | 99.9% | 99.9% |
| Weighted-average annual effective yield (b) | 10.7% | 12.4% |
| Average EBITDA (c) | $30.0 | $11.7 |
(a)The Fund had equity ownership in all of its LMM portfolio companies, and the Fund’s average fully diluted
equity ownership in those portfolio companies was 8%.
(b)The weighted-average annual effective yields were computed using the effective interest rates for all debt
investments as of December 31, 2025, including amortization of deferred debt origination fees and accretion
of original issue discount but excluding fees payable upon repayment of the debt instruments and any debt
investments on non-accrual status, and are weighted based upon the principal amount of each applicable
debt investment as of December 31, 2025.
(c)The average EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is calculated using
a weighted-average for private loan portfolio companies and a simple average for LMM portfolio
companies. These calculations exclude certain portfolio companies, including four private loan portfolio
companies and three LMM portfolio companies, as EBITDA is not a meaningful valuation metric for the
Fund’s investments in these portfolio companies, and those portfolio companies whose primary purpose is
to own real estate and those portfolio companies whose primary operations have ceased and only residual
value remains.
The Fund’s total investment portfolio at fair value consists of approximately 61% private loan, 36% LMM, 2%
middle market and 1% other portfolio investments.
The fair value of the Fund’s LMM portfolio company equity investments was 201% of the related cost basis of
such equity investments, and the Fund’s LMM portfolio companies had a median net senior debt (senior
interest-bearing debt through the Fund’s debt position less cash and cash equivalents) to EBITDA ratio of 2.5 to
1.0 and a median total EBITDA to senior interest expense ratio of 2.9 to 1.0. Including all debt that is junior in
priority to the Fund’s debt position, these median ratios were 2.7 to 1.0 and 2.8 to 1.0, respectively.(6)(7)
As of December 31, 2025, the Fund’s investment portfolio also included:
•Middle market portfolio investments in eight portfolio companies, collectively totaling $23.3 million in fair
value and $39.8 million in cost basis, which comprised 1.7% and 3.2% of the Fund’s investment portfolio at
fair value and cost, respectively; and
•Other portfolio investments in six entities, spread across four investment managers, collectively totaling
$15.5 million in fair value and $13.7 million in cost basis, which comprised 1.2% and 1.1% of the Fund’s
investment portfolio at fair value and cost, respectively.
7
As of December 31, 2025, investments on non-accrual status comprised 1.0% of the total investment portfolio at
fair value and 3.9% at cost, and the Fund’s total portfolio investments at fair value were 106% of the related
cost basis.
Fourth Quarter and Full Year 2025 Financial Results Conference Call / Webcast
MSC Income has scheduled a conference call for Friday, February 27, 2026 at 11:00 a.m. Eastern time to
discuss the fourth quarter and full year 2025 financial results.(8)
You may access the conference call by dialing 412-902-0030 at least 10 minutes prior to the start time. The
conference call can also be accessed via a simultaneous webcast by logging into the investor relations section of
the Fund’s website at https://www.mscincomefund.com.
A telephonic replay of the conference call will be available through Friday, March 6, 2026 and may be accessed
by dialing 201-612-7415 and using the passcode 13758250#. An audio archive of the conference call will also
be available on the investor relations section of the Fund’s website at https://www.mscincomefund.com shortly
after the call and will be accessible until the date of MSC Income’s earnings release for the next quarter.
For a more detailed discussion of the financial and other information included in this press release, please refer
to the MSC Income Annual Report on Form 10-K for the fiscal year ended December 31, 2025 to be filed with
the U.S. Securities and Exchange Commission (the “SEC”) (www.sec.gov) and MSC Income’s Fourth Quarter
2025 Investor Presentation to be posted on the investor relations section of the MSC Income website at https://
www.mscincomefund.com.
ABOUT MSC INCOME FUND, INC.
The Fund (www.mscincomefund.com) is a principal investment firm that primarily provides debt capital to
private companies owned by or in the process of being acquired by a private equity fund. The Fund’s portfolio
investments are typically made to support leveraged buyouts, recapitalizations, growth financings, refinancings
and acquisitions of companies that operate in diverse industry sectors. The Fund seeks to partner with private
equity fund sponsors and primarily invests in secured debt investments within its private loan investment
strategy. The Fund also maintains a portfolio of customized long-term debt and equity investments in lower
middle market companies, and through those investments, the Fund has partnered with entrepreneurs, business
owners and management teams in co-investments with Main Street Capital Corporation (NYSE: MAIN) (“Main
Street”) utilizing the customized “one-stop” debt and equity financing solutions provided in Main Street’s lower
middle market investment strategy. The Fund’s private loan portfolio companies generally have annual
revenues between $25 million and $500 million. The Fund’s lower middle market portfolio companies generally
have annual revenues between $10 million and $150 million.
ABOUT MSC ADVISER I, LLC
MSC Adviser I, LLC (“MSCA”) is a wholly-owned subsidiary of Main Street that is registered as an investment
adviser under the Investment Advisers Act of 1940, as amended. MSCA serves as the investment adviser and
administrator of the Fund in addition to several other advisory clients.
8
FORWARD-LOOKING STATEMENTS
MSC Income cautions that statements in this press release which are forward‑looking and provide other than
historical information, including but not limited to MSC Income’s ability to successfully source and execute on
new portfolio investments and deliver future financial performance and results, are based on current conditions
and information available to MSC Income as of the date hereof and include statements regarding MSC
Income’s goals, beliefs, strategies and future operating results and cash flows. Although its management
believes that the expectations reflected in those forward‑looking statements are reasonable, MSC Income can
give no assurance that those expectations will prove to be correct. Those forward-looking statements are made
based on various underlying assumptions and are subject to numerous uncertainties and risks, including, without
limitation: MSC Income’s continued effectiveness in raising, investing and managing capital; adverse changes
in the economy generally or in the industries in which MSC Income’s portfolio companies operate; the impacts
of macroeconomic factors on MSC Income and its portfolio companies’ businesses and operations, liquidity and
access to capital, and on the U.S. and global economies, including impacts related to pandemics and other
public health crises, global conflicts, risk of recession, tariffs and trade disputes, inflation, supply chain
constraints or disruptions and changes in market index interest rates; changes in laws and regulations or
business, political and/or regulatory conditions that may adversely impact MSC Income’s operations or the
operations of its portfolio companies; the operating and financial performance of MSC Income’s portfolio
companies and their access to capital; retention of key investment personnel by MSCA; competitive factors; and
such other factors described under the captions “Cautionary Statement Concerning Forward-Looking
Statements” and “Risk Factors” included in MSC Income’s filings with the SEC (www.sec.gov). MSC Income
undertakes no obligation to update the information contained herein to reflect subsequently occurring events or
circumstances, except as required by applicable securities laws and regulations.
9
MSC INCOME FUND, INC.
Consolidated Statements of Operations
(in thousands, except shares and per share amounts)
| Three Months Ended December 31, | Year Ended December 31, | |||
|---|---|---|---|---|
| 2025 | 2024 | 2025 | 2024 | |
| INVESTMENT INCOME: | ||||
| Interest, dividend and fee income: | ||||
| Control investments | $1,234 | $799 | $5,483 | $3,441 |
| Affiliate investments | 10,629 | 8,331 | 38,849 | 31,222 |
| Non‑Control/Non‑Affiliate investments | 23,053 | 24,325 | 94,821 | 100,165 |
| Total investment income | 34,916 | 33,455 | 139,153 | 134,828 |
| EXPENSES: | ||||
| Interest | (8,357) | (9,565) | (33,927) | (39,035) |
| Base management fee | (5,018) | (5,377) | (19,757) | (20,922) |
| Incentive fee on income | (3,370) | (3,131) | (12,145) | (12,494) |
| Incentive fee on capital gains | (2,763) | — | (2,763) | — |
| General and administrative | (827) | (992) | (4,337) | (4,416) |
| Internal administrative services expenses | (182) | (2,935) | (701) | (10,089) |
| Total expenses before expense waivers | (20,517) | (22,000) | (73,630) | (86,956) |
| Waiver of internal administrative services expenses | — | 2,772 | — | 9,450 |
| Total expenses, net of expense waivers | (20,517) | (19,228) | (73,630) | (77,506) |
| NET INVESTMENT INCOME BEFORE TAXES | 14,399 | 14,227 | 65,523 | 57,322 |
| Excise tax expense | (270) | (281) | (510) | (851) |
| Federal and state income and other tax expenses | (1,007) | (389) | (3,260) | (2,590) |
| NET INVESTMENT INCOME (5) | 13,122 | 13,557 | 61,753 | 53,881 |
| NET REALIZED GAIN (LOSS): | ||||
| Control investments | — | 90 | 5,305 | 147 |
| Affiliate investments | 8,639 | (3,560) | 6,320 | (3,560) |
| Non‑Control/Non‑Affiliate investments | 7,999 | (4,556) | (21,128) | 19,189 |
| Total net realized gain (loss) | 16,638 | (8,026) | (9,503) | 15,776 |
| NET UNREALIZED APPRECIATION<br><br>(DEPRECIATION): | ||||
| Control investments | (2,481) | 202 | (9,495) | 4,833 |
| Affiliate investments | 5,088 | 6,625 | 17,548 | 7,791 |
| Non‑Control/Non‑Affiliate investments | (2,065) | 2,390 | 28,375 | (28,063) |
| Total net unrealized appreciation (depreciation) | 542 | 9,217 | 36,428 | (15,439) |
| Income tax benefit (provision) on net realized gain (loss)<br><br>and net unrealized appreciation (depreciation) | (267) | 5,714 | 50 | 2,335 |
| NET INCREASE IN NET ASSETS RESULTING<br><br>FROM OPERATIONS | $30,035 | $20,462 | $88,728 | $56,553 |
| NET INVESTMENT INCOME BEFORE TAXES PER<br><br>SHARE—BASIC AND DILUTED | $0.31 | $0.35 | $1.41 | $1.43 |
| NET INVESTMENT INCOME PER SHARE—BASIC<br><br>AND DILUTED (5) | $0.28 | $0.34 | $1.33 | $1.34 |
| NET INCREASE IN NET ASSETS RESULTING<br><br>FROM OPERATIONS PER SHARE—BASIC AND<br><br>DILUTED | $0.64 | $0.51 | $1.91 | $1.41 |
| WEIGHTED-AVERAGE SHARES<br><br>OUTSTANDING—BASIC AND DILUTED | 46,923,388 | 40,232,637 | 46,497,019 | 40,174,311 |
10
MSC INCOME FUND, INC.
Consolidated Balance Sheets
(in thousands, except per share amounts)
| December 31,<br><br>2025 | December 31,<br><br>2024 | |
|---|---|---|
| ASSETS | ||
| Investments at fair value: | ||
| Control investments | $58,372 | $69,878 |
| Affiliate investments | 406,771 | 351,360 |
| Non‑Control/Non‑Affiliate investments | 870,244 | 756,269 |
| Total investments | 1,335,387 | 1,177,507 |
| Cash and cash equivalents | 20,635 | 28,375 |
| Interest and dividend receivable | 12,273 | 11,925 |
| Deferred financing costs | 3,190 | 1,985 |
| Prepaids and other assets | 9,546 | 4,254 |
| Deferred tax asset, net | — | 625 |
| Total assets | $1,381,031 | $1,224,671 |
| LIABILITIES | ||
| Credit Facilities | $453,000 | $415,688 |
| Series A Notes due 2026 (par: $150,000 as of both December 31, 2025 and 2024) | 149,751 | 149,453 |
| Accounts payable and other liabilities | 3,549 | 4,723 |
| Interest payable | 5,946 | 6,909 |
| Dividend payable | 16,772 | 14,487 |
| Base management and incentive fees payable | 8,388 | 8,508 |
| Deferred tax liability, net | 4,966 | — |
| Total liabilities | 642,372 | 599,768 |
| NET ASSETS | ||
| Common stock | 47 | 40 |
| Additional paid‑in capital | 782,007 | 689,580 |
| Total overdistributed earnings | (43,395) | (64,717) |
| Total net assets | 738,659 | 624,903 |
| Total liabilities and net assets | $1,381,031 | $1,224,671 |
| NET ASSET VALUE PER SHARE | $15.85 | $15.53 |
11
MSC INCOME FUND, INC.
Reconciliation of Adjusted Net Investment Income and Adjusted Net Investment Income Before Taxes
(in thousands, except per share amounts)
| Three Months Ended | Year Ended | |||
|---|---|---|---|---|
| December 31, | December 31, | |||
| 2025 | 2024 | 2025 | 2024 | |
| Net investment income (5) | $13,122 | $13,557 | $61,753 | $53,881 |
| Incentive fee on capital gains (3) | 2,763 | — | 2,763 | — |
| Adjusted net investment income (1) | 15,885 | 13,557 | 64,516 | 53,881 |
| Excise tax expense | 270 | 281 | 510 | 851 |
| Federal and state income and other tax expenses | 1,007 | 389 | 3,260 | 2,590 |
| Adjusted net investment income before taxes (2) | $17,162 | $14,227 | $68,286 | $57,322 |
| Per share amounts: | ||||
| Net investment income per share - | ||||
| Basic and diluted (5) | $0.28 | $0.34 | $1.33 | $1.34 |
| Adjusted net investment income per share - | ||||
| Basic and diluted (1) | $0.34 | $0.34 | $1.39 | $1.34 |
| Adjusted net investment income before taxes per share - | ||||
| Basic and diluted (2) | $0.37 | $0.35 | $1.47 | $1.43 |
12
MSC INCOME FUND, INC.
Endnotes
(1) ANII is NII as determined in accordance with U.S. Generally Accepted Accounting Principles, or U.S.
GAAP, excluding the impact of the capital gains incentive fee(3). MSC Income believes presenting ANII and
the related per share amount is useful and appropriate supplemental disclosure for analyzing the Fund’s
financial performance since the calculation of the capital gains incentive fee is based on realized gains and
losses and unrealized fair value appreciation and depreciation, none of which are included in NII. However,
ANII is a non-U.S. GAAP measure and should not be considered as a replacement for NII or other earnings
measures presented in accordance with U.S. GAAP and should be reviewed only in connection with such
U.S. GAAP measures in analyzing MSC Income’s financial performance. A reconciliation of NII in
accordance with U.S. GAAP to ANII is detailed in the financial tables included with this press release.
(2) ANII before taxes is NII as determined in accordance with U.S. GAAP, excluding the impact of any tax
expenses included in NII and the capital gains incentive fee(3). MSC Income believes presenting ANII before
taxes and the related per share amount is useful and appropriate supplemental disclosure for analyzing the
Fund’s financial performance since (i) the calculation of the capital gains incentive fee is based on realized
gains and losses and unrealized fair value appreciation and depreciation, none of which are included in NII,
and (ii) tax expenses included in NII may include (a) excise tax expense, which is not solely attributable to
NII, and (b) deferred taxes, which are not payable in the current period. However, ANII before taxes is a
non-U.S. GAAP measure and should not be considered as a replacement for NII, NII before taxes or other
earnings measures presented in accordance with U.S. GAAP and should be reviewed only in connection
with such U.S. GAAP measures in analyzing MSC Income’s financial performance. A reconciliation of NII
in accordance with U.S. GAAP to ANII before taxes is detailed in the financial tables included with this
press release.
(3) Pursuant to the amended advisory agreement effective upon the MSC Income Listing, the incentive fee on
capital gains is determined and payable to the Fund’s investment adviser (the “Adviser”) in arrears, if any,
as of the end of each calendar year. This fee equals (a) 17.5% of the Fund’s incentive fee capital gain, which
is calculated as the Fund’s (i) cumulative net realized gains (net of any related net income tax expense),
minus (ii) cumulative unrealized depreciation (net of any related income tax benefit, and excluding any
unrealized appreciation), minus (b) the aggregate amount of any previously paid capital gains incentive fee,
in each case from the MSC Income Listing date through the applicable calendar year ended. In accordance
with U.S. GAAP, at the end of each reporting period, the Fund estimates the capital gains incentive fee and
accrues the fee based upon a hypothetical liquidation of its investment portfolio at the then current fair
value. Therefore, the calculation of the accrual equals (a) the Fund’s cumulative change in net fair value,
including both (i) the cumulative net realized gain/loss and (ii) the cumulative net unrealized appreciation/
depreciation (in both cases, net of any related cumulative net income tax expense or benefit), minus (b) the
aggregate amount of any previously paid capital gains incentive fee, in each case from the MSC Income
Listing date through the applicable period ended. However, any capital gains incentive fee accrued related to
the unrealized appreciation is neither earned nor payable to the Adviser until such time that it is realized,
and assuming at the end of a calendar year such incentive fee capital gain exists excluding any cumulative
unrealized appreciation (in each case, net of any related net income tax expense or benefits). For the fourth
quarter of 2025, the Fund accrued a capital gains incentive fee of $2.8 million. For further discussion, see
Note J Related Party Transactions and Arrangements in the notes to the consolidated financial statements
included in Item 8. Consolidated Financial Statements and Supplementary Data of the Fund's Annual
Report on Form 10-K filed with the SEC on February 27, 2026.
(4) Return on equity equals the net increase in net assets resulting from operations divided by the average
quarterly total net assets.
13
(5) NII for each period in 2024 and the first quarter of 2025 necessary to present the comparable amounts for
the year ended December 31, 2025 have been revised to include the impact of excise tax and NII related
federal and state income and other tax expenses previously included within the total income tax provision.
This correction was determined to be immaterial to any impacted prior periods and had no impact on net
increases in net assets resulting from operations or the related per share amounts.
(6) Portfolio company financial information has not been independently verified by MSC Income.
(7) These credit statistics exclude portfolio companies on non-accrual status and portfolio companies for which
EBITDA is not a meaningful metric.
(8) No information contained on the Fund’s website or disclosed on the February 27, 2026 conference call,
including the webcast and the archived versions, is incorporated by reference in this press release or any of
the Fund’s filings with the SEC, and you should not consider that information to be part of this press release
or any other such filing.