KKR Credit Income Fund's (ASX:KKC) manager and responsible entity's targeted distribution for fiscal 2026 is AU$0.20, representing an annualized distribution yield of 8.2% based on net tangible assets of AU$2.43 as at May 31, according to a Friday Australian bourse filing.

The distribution also represents an annualized distribution yield of 8.8% based on the unit price of AU$2.27 as at May 30, the filing added.

The manager expects KKC to continue to benefit from attractive yields in global credit markets, which is reflected in the Fund keeping its income target for fiscal 2025 consistent with what it paid last year.

The targeted distribution is based on expected cash flows from the company's portfolio and management costs, using the manager's outlook on interest rates, credit spreads, and currency hedging, the filing added.

The manager believes KKC is well-positioned, with a 58% portfolio allocation to its historically strong-performing strategy and 42% to the lower-volatility European direct lending strategy, both expected to support income generation.

The company's shares fell nearly 2% in recent Friday trade.