Capital Southwest Corporation · NASDAQ:CSWC
Capital Southwest — Q2 FY2027 Earnings Presentation
26 slides from Capital Southwest's earnings presentation, Nov 2, 2026
Slide 1: Q2 2027 Earnings Presentation
Q2 2027 Earnings Presentation 8333 Douglas Avenue, Suite 1100 | Dallas, Texas 75225 | 214.238.5700 | capitalsouthwest.com November 3, 2026 Capital Southwest Corporation
Slide 2: Important Notices
Page 2 Important Notices • These materials and any presentation of which they form a part are neither an offer to sell, nor a solicitation of an offer to purchase, any securities of Capital Southwest. • These materials and the presentations of which they are a part, and the summaries contained herei
Slide 3: Forward-looking statements
Page 3 • This presentation contains forward-looking statements relating to, among other things, the business, market conditions, financial condition and results of operations of Capital Southwest, the anticipated investment strategies and investments of Capital Southwest, and future market demand. A
Slide 4: CSWC Senior Management
Page 4 Chris T. Rehberger Chief Financial Officer, Treasurer and Secretary • Joined Capital Southwest in September 2015 • Former VP at American Capital • 20+ years of BDC experience • BS – University of Virginia | MBA – University of Virginia CSWC Senior Management Josh S. Weinstein Senior Managing
Slide 5: Conference Call Participants
Page 5 Michael S. Sarner President and Chief Executive Officer Chris T. Rehberger Chief Financial Officer, Treasurer and Secretary Josh S. Weinstein Senior Managing Director and Chief Investment Officer Morganne A. Stewart Director of Communications Conference Call Participants
Slide 6: CSWC Company Overview
Page 6 • CSWC was formed in 1961, and elected to be regulated as a BDC in 1988 • Publicly-traded on Nasdaq: Common Stock (“CSWC”) • Internally Managed BDC with RIC tax treatment for U.S. federal income tax purposes • 46 employees based in Dallas, Texas • Total Balance Sheet Assets of $2.5 B as of Se
Slide 7: Lower Middle Market Credit Strategy
Page 7 CSWC leads financing transactions, primarily backing private equity firms that generally fit the following parameters Lower Middle Market Credit Strategy • Flexible financing solutions to fund growth, changes of control, or other corporate events • Investments are diverse among industries, ge
Slide 8: Q2 2027 Highlights
Page 8 • Q2 2027 Pre-Tax Net Investment Income (“NII”) of $37.2 MM or $0.58 per share • Declared a regular quarterly dividend of $0.58 per share, of which $0.1934 per share will be paid monthly for each of October, November, and December 2026 ◦ Additionally, declared quarterly supplemental dividend
Slide 9: Investment Activity Highlights
Page 9 Investment Activity Highlights • During the quarter, CSWC originated $391.0 MM in total new committed investments ($268.6 MM funded at close) to fourteen new portfolio companies and sixteen existing portfolio companies ◦ Committed investments to new portfolio companies consisted of $314.2 MM
Slide 10: Q2 2027 Origination Detail
Page 10 Diversified, Granular and Conservative Origination Activity • $391.0 MM in total new committed investments ◦ $327.1 MM committed in fourteen new portfolio companies ◦ $63.9 MM committed in sixteen existing portfolio companies • Weighted average leverage of 3.4x at closing • Weighted average
Slide 11: NAV per Share Bridge for Quarter Ended 09/30/26
Page 11 $16.61 $0.58 $(0.58) $(0.06) $(0.20) $(0.01) $0.31 $(0.01) 6/30/2026 NAV/Share Pre- Tax Net I nvest ment In come Regular Dividend Supplem ental Dividend Net C hange in In vest ment P ortfo lio Valu e Real ize d/Unrea lize d Tax Accr etio n fro m Equity Iss uance Other Corporat e 9/30/2026 NA
Slide 12: CSWC Investment Portfolio Composition
Page 12 CSWC Investment Portfolio Composition (1) At September 30, 2026 and June 30, 2026, we had equity ownership in approximately 68% and 67%, respectively, of our investments. (2) Joint Venture Investments consist of equity investments in CapTrin Partners, LLC and Desert Star 2026 LLC. (3) The we
Slide 13: Investment Rating Distribution of Debt Investments
Page 13 Approximately 89% of all debt investments are currently rated a "1" or "2" as credit portfolio continues to demonstrate solid performance Investment Rating 6/30/2026 9/30/2026 # of Companies Fair Value ($MM) % of Portfolio (FV) # of Companies Fair Value ($MM) % of Portfolio (FV) 1 19 $376.5
Slide 14: History of Value Creation
Page 14 History of Value Creation $17.68 $17.38 $18.63 $20.90 $22.71 $21.97 $24.90 $28.27 $30.06 $32.93 $35.40 $37.95 $38.51 $39.18 $17.68 $17.34 $17.80 $19.08 $18.62 $15.13 $16.01 $16.86 $16.37 $16.77 $16.70 $16.69 $16.61 $16.64 $0.26 $0.26 $1.16 $2.31 $2.71 $3.41 $3.66 $3.89 $4.12 $4.36 $4.42 $4.4
Slide 15: Track Record of Consistent Dividends Continues
Page 15 • In the last twelve months ended 9/30/2026, CSWC generated $2.34 per share in Pre-Tax NII and paid out $2.32 per share in Regular Dividends • Cumulative Pre-Tax NII Regular Dividend Coverage of 109% since launch of credit strategy in 2015 • Total of $4.54 per share Special and Supplemental
Slide 16: Granular Credit Portfolio Weighted Towards First Lien
Page 16 Granular Credit Portfolio Heavily Weighted Towards First Lien Investments 99% of credit portfolio in first lien senior secured loans with an average investment hold size of 0.76% at fair value as of 9/30/2026 Credit Portfolio Heavily Weighted to First Lien $ (M illi on s) Average H old S ize
Slide 17: CSWC Portfolio Mix by Type and Industry
Page 17 First Lien 89.4% Second Lien 1.0% Senior Subordinated Debt 0.1% JV Equity 1.5% Equity 8.0% CSWC Portfolio Mix as of September 30, 2026 at Fair Value Current Investment Portfolio (By Type) Current Investment Portfolio (By Industry) Current Investment Portfolio of approximately $2.4 B continue
Slide 18: Operating Leverage Trend
Page 18 Operating Leverage Trend Driving exceptional Operating Leverage through benefits of internally-managed structure Period Ending To ta l A ss et s ( $M M ) O perating Expenses as % of A vg A ssets $284 $326 $417 $552 $585 $736 $974 $1,258 $1,557 $1,883 $2,178 $2,316 $2,525 4.9% 4.2% 3.7% 3.0%
Slide 19: Significant Unused Debt Capacity with Long-Term Duration
Page 19 Significant Unused Debt Capacity with Long-Term Duration Debt Obligations Total Commitments Interest Rate Maturity Principal Drawn Undrawn Commitment SPV Credit Facility $200.0 MM Term SOFR + 2.50% March 2029 $105.0 MM $95.0 MM 2029 Convertible Notes (1) $230.0 MM 5.125% November 2029 $230.0
Slide 20: Balance Sheet
Page 20 Balance Sheet (In Thousands, except per share amounts) Quarter Ended 12/31/2025 Quarter Ended 3/31/2026 Quarter Ended 6/30/2026 Quarter Ended 9/30/2026 Assets Portfolio Investments $2,013,205 $2,097,446 $2,202,282 $2,410,129 Cash & Cash Equivalents 42,559 29,045 58,457 47,977 Restricted Cash
Slide 21: Income Statement
Page 21 Income Statement (In Thousands, except per share amounts) Quarter Ended 12/31/2025 Quarter Ended 3/31/2026 Quarter Ended 6/30/2026 Quarter Ended 9/30/2026 Investment Income Interest Income $48,813 $47,834 $50,466 $55,104 PIK Interest Income 4,585 3,772 4,912 4,981 Dividend Income 3,748 2,540
Slide 22: Portfolio Statistics
Page 22 Portfolio Statistics Continuing to build a well performing credit portfolio (In Thousands) Quarter Ended 12/31/2025 Quarter Ended 3/31/2026 Quarter Ended 6/30/2026 Quarter Ended 9/30/2026 Portfolio Statistics Fair Value of Debt Investments $1,830,458 $1,916,494 $1,999,896 $2,181,508 Average
Slide 23: Investment Income Detail
Page 23 Investment Income Detail Constructing a portfolio of investments with recurring cash yield (In Thousands) Quarter Ended 12/31/2025 Quarter Ended 3/31/2026 Quarter Ended 6/30/2026 Quarter Ended 9/30/2026 Investment Income Breakdown Cash Interest $46,988 $45,992 $48,143 $53,095 Cash Dividends
Slide 24: Key Financial Metrics
Page 24 Key Financial Metrics Strong Pre-Tax Net Investment Income and Dividend Yield driven by net portfolio growth and investment performance (1) Return on Equity is calculated as the quarterly annualized Pre-Tax NII, Realized Earnings, or Total Earnings, respectively, divided by equity at the end
Slide 25: Interest Rate Sensitivity
Page 25 Note: Illustrative change in annual NII does not adjust for potential changes in the credit market, credit quality, size and composition of the assets in the portfolio and is implied using a base rate of 4.08%. It also does not adjust for other business developments, including future origina
Slide 26: Corporate Information
Page 26 Corporate Information Board of Directors Senior Management Fiscal Year End Inside Director Michael S. Sarner March 31 Michael S. Sarner President & Chief Executive Officer Independent Directors Independent Auditor David R. Brooks Chris T. Rehberger RSM US LLP Chicago, ILChristine S. Battist