REG - Aquila Energy Effcn. - Half-year Report
23/09/2025 07:02
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RNS Number : 3177A Aquila Energy Efficiency Trust PLC 23 September 2025
AQUILA ENERGY EFFICIENCY TRUST PLC
LEI: 213800AJ3TY3OJCQQC53
HALF-YEAR REPORT
FOR THE SIX MONTHS ENDED 30 JUNE 2025
Consolidated Financial Highlights
Financial information At 30 June At 31 December 2024
2025
Net asset value ("NAV") per share (pence) 50.15 85.55
Share price (pence) 33.70 52.00
Discount (%)(1) (32.8) (39.2)
Net assets (£ million) 40.84 69.67
Dividend declared in respect of the period (pence) 36.837 6.139
Ongoing charges (%)(1) 3.9 3.8
Performance summary Six months Year ended
ended 31 December
30 June 2025 2024
NAV total return (%)(1) 1.7 (2.7)
Share price total return (%)(1) 35.6 1.6
1 Alternative Performance Measures ("APMs)
These are APMs as defined by the European Securities and Market Authority.
Definitions of these measures can be found further below in this Interim
Report.
STRATEGIC REPORT
CHAIR'S STATEMENT
ON BEHALF OF THE BOARD I AM PLEASED TO PRESENT THE HALF-YEAR REPORT FOR AQUILA
ENERGY EFFICIENCY TRUST PLC FOR THE 6 MONTH PERIOD ENDED 30 JUNE 2025.
My Chair's statement for the Company's Half-Year Report covers the 6 months
ended 30 June 2025 ("the period"). The Company's Annual Report and Accounts
was published on 29 April 2025 and, therefore, there is some duplication in
the content of the 2024 Annual Report Chair's Statement and this Statement.
Investment Performance
The Company's unaudited NAV as at 30 June 2025 was 50.15 pence per ordinary
share (85.55 pence at 31 December 2024), which primarily reflects the payment
of a dividend of 36.837 pence per ordinary share on 30 May 2025 as part of the
strategy to return capital to shareholders pursuant to the Managed Run-Off of
the Company. Adjusting for the dividend, the Company's unaudited NAV per share
returned 1.7% over the 6 months ended 30 June 2025.
This dividend of £30.0 million in total was made following significant
realisations:
· in January and February 2025, the Company received £0.5
million and £7.0 million from a quarterly contractual payment and full
repayment, respectively, of the Bio-LNG investment in Germany; and
· between February and April 2025, three of the five
Superbonus investments in Italy were largely repaid realising proceeds of
£18.4 million.
The repayments of the Superbonus investments were made after negotiation by
two of the three developers of these projects (the "ESCOs"), and not from
proceeds received from the purchasers of the tax credits generated from these
projects, which was the expected source of repayment when these investments
were initially made. The return from the Superbonus projects was in two parts;
payments for the tax credits and an interest element calculated by reference
to the delay in receiving payment. In order to mitigate the significant
delayed interest cost, which was being borne by ESCOs, a repayment plan was
proposed to reduce the impact of late payment interest accruing on these
investments. To accelerate the realisation of these Superbonus investments,
which have been significantly slower than originally anticipated, the Company
accepted a modest discount of the full late payment interest due on these
investments. These investments achieved internal rates of return of greater
than 9% p.a. The Company is in discussions to secure the realisation of the
remaining Superbonus investments. The remaining Superbonus investments had a
book value of £7.3 million as at 30 June 2025.
The Company's shares continued to trade at a significant discount to NAV over
the period and, as discussed in previous Statements, the focus has continued
to be on maximising value for the return of capital to shareholders. This has
meant focusing on negotiating individual exits to achieve acceptable
realisations. This activity is set out in the Investment Adviser's Report.
The Company's investments continue to generate income. Investment income for
the period was £1.9 million, down from £3.3 million in the comparative
half-year and net revenue profit was £0.6 million, down from £1.3 million in
the comparative half-year. The investment interest income for the period was
£1.49 million, compared to £2.76 million in the comparative half-year.
Interest income from cash deposits for the period was £0.39 million compared
to £0.52 million in the comparative half-year. The reductions were primarily
because of the realisations achieved and lower cash balances earning interest
compared to the previous half-year.
As at 31 August 2025 cash balances, excluding the cash provided as collateral
for the FX hedging described below, were £8.4 million excluding accrued
interest.
In line with the Company's investment policy, as at 30 June 2025, £28.0
million of the Company's investments of £30.63 million were denominated in
Euros. Information on the Company's continued use of forward foreign exchange
agreements to hedge the value of the Euro-denominated investments can be found
in the Investment Adviser's report.
The Board continues to very actively seek and assess opportunities to realise
capital through the sale of assets. As we have made clear in previous
reports, this remains challenging as the portfolio consists of assets that are
geographically diverse, small in size, contractually complex and many have
lengthy maturities of between ten to eighteen years. In addition, due to the
Managed Run-Off status of the Company, further complexities have arisen around
the realisation of and protection of value in the Company's assets. The Board
continues to remain actively involved in negotiating terms to protect the
value in the portfolio and continues to work on achieving realisations and
returning capital to shareholders.
Costs
The Board continues to be very mindful of the costs incurred in the running of
the Company whilst it is in Managed Run-Off. The unintended and unhelpful
consequences of the Managed Run-Off are numerous. We have renegotiated some of
our service provider agreements and will look to renegotiate where we can
without compromising service quality and will remain focused on cost recovery
and reduction, in particular, where additional costs have been incurred as a
consequence of underperformance of particular services provision.
Dividend
In addition to the special interim dividend of 36.837 pence per ordinary share
paid on 30 May 2025, the Board of Directors has declared an interim dividend
of 4.00 pence per ordinary share in respect of the first six months of the
financial year ending 31 December 2025 payable on 24 October 2025 to
Shareholders on the register on 3 October 2025. The ex-dividend date is 2
October 2025.
Miriam Greenwood OBE DL
Chair of the Board
22 September 2025
INVESTMENT ADVISER'S REPORT
OVERVIEW
In the period, the Investment Adviser negotiated the realisation of four
significant investments, which have generated proceeds in the period of £25.9
million:
· In January and February 2025, the Company received £0.5
million and £7.0 million from a quarterly contractual payment and full
repayment, respectively, of the Bio-LNG investment in Germany;
· Between February and April 2025, three of the five
Superbonus investments were largely repaid realising proceeds of £18.4
million. This represents repayment of the majority of Superbonus investments
in Italy.
In addition to these negotiations, the Investment Manager continues to support
the Managed Run-Off of the Company's Portfolio, undertaking negotiations to
achieve the realisation of individual investments at acceptable terms before
their contracted maturity date, and monitoring the performance and addressing
where necessary operating performance and/or payment issues in the Company's
Portfolio.
In the period, the Company made no further investments but did incur legal and
other costs associated with the management of the Company's portfolio. As at
30 June 2025 there remains no commitment to invest in the Portfolio.
The Investment Adviser continues to closely monitor the performance of all of
the Company's investments and, in particular, the receipt of cash payments,
which are due on a monthly, quarterly and annual basis. In the period,
the large majority of the Company's other (i.e. non-Superbonus) investments
and, in particular, all of the larger investments, performed in accordance
with their contractual terms. However, there are investments in the portfolio
which continue to be problematic:
· Two Solar PV investments in Spain were written down
further to a value as at 30 June 2025 of £0.2 million (£0.4 million as at
31 December 2024) because of operational difficulties with individual
projects, the failure of the ESCOs which developed the projects to remedy
these difficulties and expected higher O&M costs from having to replace
these ESCOs.
· The two wind investments in the UK were written down
further to a value of £0.9 million as at 30 June 2025 (£1.0 million as at 31
December 2024), principally because of continuing operational problems at
individual sites, which have resulted in lower than expected electricity
production and higher operational and maintenance costs.
As at 30 June 2025 £28.0 million of the Company's total investments of £30.6
million were denominated in Euros (£53.3 million out of £56.3 million as at
31 December 2024). During the period, the Company continued to use forward
foreign exchange agreements to hedge the value of the Euro denominated
investments. In the period, the Company reported realised foreign exchange
losses of £0.7 million, paying out £0.7 million in cash upon settlement of
these forward foreign exchange agreements. The Company continues to seek to
hedge approximately 100% of the value of the Company's Euro-denominated
investments. The quantum of the forward foreign exchange agreements is
modified upon the rollover of the contracts, which have maturities of between
one and three months, to reflect returns of capital and changes in valuation.
£2.5 million of the Company's cash balances continue to be held as security
by the bank providing forward foreign exchange contracts.
As at 30 June 2025, the Company's cash position, including cash held as
collateral for foreign exchange hedging, was £11.0 million (£14.4 million
as at 31 December 2024).
PORTFOLIO OVERVIEW
As at 30 June 2025, the Company's portfolio of 26(1) Energy Efficiency
Investments was diversified across geographies (Italy, Spain, Germany and the
United Kingdom), technologies, counterparties and ESCO partnerships.
The Company's portfolio is characterised by projects with (i) a low
technology risk through the use of proven technologies; (ii) medium to
long-term contracts providing for predictable cash flows; and (iii)
counterparties with good creditworthiness. The Managed Run-Off strategy has
impacted the level of diversification due to the realisations achieved in the
period.
1 Investments with a value of zero as at 30 June 2025 are
excluded
i) Projects by Technology
% of investment values by technology - as of 30 June 2025
ii) Projects by Tenor
% of investment values by maturity (years) - as of 30 June 2025
iii) Projects by Country
% of investment values by country - as of 30 June 2025
iv) Projects by Investment Grade
% of investment values by credit rating - as of 30 June 2025
Approximately 69% of the Company's investments by value as at 30 June 2025
(84% as at 31 December 2024) had investment grade counterparties, as assessed
using either the Investment Adviser's credit analysis or external agencies.
The decrease in the percentage of investment grade counterparties is
attributable to the realisations of the Bio-LNG investment in Germany and the
Superbonus investments, which had been assessed as having credit ratings of
BBB+/BBB-. In the period, there was no significant change in the credit
ratings of the Company's counterparties.
For projects which are non-investment grade, there are typically additional
protections. These protections include the ability to export power to the
grid, and to extend the maturity of a contract with the ESCO and the
underlying counterparty to recover missed payments. The latter is possible
because the Company's financing agreements are of a shorter duration than the
useful life of equipment installed and, in many cases, of a shorter duration
than the contract between the ESCO and the counterparty. The credit quality
and performance of the Company's portfolio is discussed further below in
respect of valuations and ECL provisions.
The Company's portfolio comprises largely fixed return cash flows. 93% of the
total investment value provides a fixed rate of return from contracted cash
flows (95% as at 31 December 2024). Approximately 7% by investment value has
variable cash flows linked to power production and power prices, or inflation
indexation. In many cases, these variable return investments have significant
fixed income elements, for example feed-in tariffs or fixed power prices in
Power Purchase Agreements. In addition, certain investments have downside
protections, for example, minimum contractual returns in order to reduce the
risk of lower than forecast cash flows.
Over the remaining life of the investments, the Company's portfolio of
investments is expected to achieve an unlevered average return of 10.0% per
annum over the remaining life of the investments, an increase from the yield
of 9.2% per annum reported in the audited Annual Report and Accounts for the
year ended 31 December 2024. The increase in expected return is due to
expected timings of repayments being nearer term.
Investments in Italy (£11.0 million value as at 30 June 2025)
Following the realisation of the majority of three of the five Superbonus
investments, as at 30 June 2025 total investment value in Italy was £11.0
million across a total of 11 investments.
1) Investments in Italian "Superbonus" projects (£7.3 million value as at 30
June 2025)
Between February and April 2025, three of the five Superbonus investments were
largely repaid realising proceeds of £18.4 million. The repayments of the
Superbonus investments were made after negotiation by two of the three
developers of these projects (the "ESCOs"), and not from proceeds received
from the purchasers of the tax credits generated from these projects, which
was the expected source of repayment when these investments were initially
made. The return from the Superbonus projects was in two parts, payments for
the tax credits and an interest element calculated by reference to the delay
in receiving payment. To mitigate the significant delayed interest cost, which
was being borne by ESCOs, a repayment plan was proposed to reduce the impact
of late payment interest accruing on these investments. To accelerate the
realisation of these Superbonus investments, which have been significantly
slower than originally anticipated, the Company accepted a modest discount of
the full late payment interest due on these investments. These investments
achieved internal rates of return of greater than 9% p.a.
The Company is in discussions to secure the realisation of the remaining
Superbonus investments because the ESCOs continue to experience delays with
final payments from the buyers of the tax credits.
"Superbonus" is an incentive measure introduced by the Italian Government
through Decree "Rilancio Nr. 34" on 19 May 2020, which aimed to make
residential buildings (condominiums and single houses) more energy efficient
through improvements to thermal insulation and heating systems. When
qualifying measures were completed, ESCOs delivering the measures were awarded
a tax credit equal to 110% of the cost of the measures. These tax credits can
then be sold to banks, insurance companies and other corporations and, thus,
projects can be financed without the need for a financial contribution from
landlords. The projects involve a range of energy efficiency measures
including insulation, the replacement of heating systems with more efficient
solutions and energy efficient windows. In the period since the Company made
its investments in Superbonus projects the Italian Government reduced the
value of tax credits generated from Superbonus projects to 70% in 2024 and to
65% from 1 January 2025. In addition, changes were made to how these tax
credits could be utilised.The ESCOs, who developed the projects which the
Company invested in, have confirmed that their projects were not affected by
these changes. However, the changes have had an effect on the confidence of
the buyers of these tax credits, which has resulted in protracted verification
exercises.
2) Solar PV investments for self-consumption in Italy (£3.7 million value as
at 30 June 2025)
As at 30 June 2025, the Company had invested in eight rooftop Solar PV
projects with an aggregate capacity of 5.1 MWp and a book value of £3.7
million. All of these projects are operational and cash generative. These
projects enable companies to reduce their energy costs and CO2 emissions and
avoid grid losses through the self-consumption of the electricity produced.
2.i) Projects with Noleggio Energia
Of the eight Solar PV projects which the Company has committed to finance,
seven projects have been developed by the ESCO Noleggio Energia, which was
established in 2017 and is an Italian company that specialises in providing
operating leases for energy efficiency and renewable energy projects for
commercial and industrial clients in Italy. These projects are all structured
as the purchase of receivables from operating leases with maturities of seven
or ten years, with a weighted average maturity of seven years outstanding, and
all use very similar documentation. Noleggio Energia has paid the SPV the
monthly receivables from these operating lease agreements, which provide for
fixed rates of return with a weighted average return of 8.9% per annum.
2.ii) Project with CO-VER Power Technologies
In January 2022, the Company refinanced the acquisition of an existing rooftop
Solar PV plant in Ascoli Piceno (Central Italy) with a generating capacity of
902 kWp. The investment, with an original cost of £0.7 million, is based
on the purchase of receivables generated by an energy service contract
between the leading Italian engineering firm CO-VER Power Technologies
("CO-VER") and its subsidiary Futura APV S.r.l. ("Futura"). The contract
governs the management of an operating roof-mounted Solar PV plant until April
2028. Thereafter, the investment is based on a feed-in tariff for an
additional six years, aggregating to a twelve-year tenor. The investment,
which generated total cash receipts of £0.3 million in the period from
inception of the investment until 30 June 2025, is forecast to generate
a return of 8.4% per annum based on the valuation as at 30 June 2025 of
£0.58 million.
CO-VER has a successful 20-year history in developing industrial projects in
the areas of energy storage systems, co/tri-generation plants and renewable
energies. Futura is the owner of the PV plant which benefits from feed-in
tariffs payable by Gestore dei Servizi Energetici ("GSE"). GSE is a joint
stock company managed by the Italian Government which is responsible for
promoting and developing the growth of renewable assets in Italy. GSE
currently has a credit rating of BBB+ from the Italian Government.
Investments in Spain (£6.1 million value as at 30 June 2025)
As at 30 June 2025, total investment value in Spain was £6.1 million across a
total of six investments and there were no outstanding investment commitments.
1) Solar PV investments in Spain (£3.7 million value as at 30 June 2025)
As at 30 June 2025, the Company had capital invested in five Solar PV
installation projects throughout Spain with five project developers. The
largest project, with a value of £2.9 million as at 30 June 2025 has been
structured to provide a fixed rate of return. The other four projects have
been structured under Power Purchase Agreements ("PPAs") with maturities of up
to eighteen years and have variable revenues, often subject to a combination
of production fluctuations, power price changes and inflation. In addition,
excess production beyond the on-site demand may be injected into the grid.
As reported earlier in the Investment Adviser's Report, there are operational
issues with two Solar PV projects in Spain, which were developed by ESCOs
which have entered into administration. These issues resulted in additional
negative fair value adjustments of £0.2 million in the period ended 30 June
2025 compared to the position as at 31 December 2024. In these cases, the
Investment Adviser has been seeking to exercise its legal rights including its
step in rights to procure a new ESCO to manage the projects so that the PPAs
can be maintained with the counterparties.
2) Building Energy Efficiency Investments in Spain (£2.4 million value as at
30 June 2025)
The Spanish Government has established incentive schemes to promote energy
efficiency measures in buildings, including the "Programa de Rehabilitacion
Energetica de Edificios" ("PREE"). PREE is a €402.5 million incentive scheme
in Spain which is designed to promote and reward energy efficiency
improvements for condominiums and other buildings, improving their energy
rating by at least one energy class. Under this scheme, the Company has
invested £2.3 million to fund the refurbishment of condominiums, which is
being managed by a leading ESCO specialised in designing and implementing
energy efficiency and renewable energy projects in Spain. The investment cash
flows, which are expected to commence in the third quarter of 2025, are based
on the purchase of receivables generated by the underlying energy saving
contracts between the ESCO and the "Comunidad de Proprietarios"; the legal
entities which represent each of the owners of the apartments in a residential
building. The receivables have been rated with the S&P equivalent of
AAA/AA-.
Investments in Germany (£10.9 million value as at 30 June 2025)
As reported earlier in the Investment Adviser's Report, the Company completed
the sale of the Bio-LNG investment in Germany in February 2025 at a small
premium to the net book value at 31 December 2024. This investment produced a
gross rate of return of 8.9% p.a. over the life of the investment, which was
above the expectation for this asset of 8.4% p.a. at the time the initial
investment was made in November 2022. The two remaining investments in Germany
with a book value of £10.9 million as at 30 June 2025 provide for fixed rates
of return, with quarterly and annual cash flows respectively, are performing
in line with their contracts. The larger investment refinanced the
installation of water management devices in condominiums and multi-family
homes, mainly managed by large property managers. The second investment
refinanced the installation of more efficient and environmentally friendly
heating systems for private customers through long-term rental and service
agreements. Both investments are structured as investments in notes issued by
special purpose subsidiaries of the technology and services companies. These
notes entitle the noteholder to receivables from the contracts between the
technology and services companies and their clients, who are a combination of
large property managers and homeowners.
Investments in the United Kingdom (£2.7 million value as at 30 June 2025)
There are seven investments in the United Kingdom with a value as at 30 June
2025 of £2.7 million, of which four are lighting, one is CHP and two are wind
investments. In the period, the Company negotiated the cancellation of a small
commitment outstanding of less than £0.05 million for lighting investments.
The lighting and CHP investments are fixed return investments although one of
the lighting investments benefits from annual inflation adjustments to the
income. The wind investments are variable return investments due to the
variability of operation and maintenance costs, power production and export
tariffs, which are renewed each year, although a significant percentage of
revenue is based on feed-in tariffs which benefit from annual inflation
adjustments.
The fixed return investments performed satisfactorily in the period, although
there are immaterial amounts overdue from a few clients. However, the wind
investments, which had a value of £1.03 million as at 31 December 2024, have
been further written down to a value of £0.87 million as at 30 June 2025 due
primarily to operational problems at individual sites, which have resulted in
lower than expected electricity production and higher operation and
maintenance costs. In addition, the ESCO has withheld payments due to the
Company in 2024 because it has not generated sufficient income to cover its
operating costs. The Company remains in negotiations with the ESCO to
restructure the investments.
Valuations and Expected Credit Loss Provisions as at 30 June 2025
As at 30 June 2025, the Company's investments had a book value of £30.63
million, with investments held at amortised cost valued at £28.40 million and
investments held at fair value through profit or loss valued at
£2.23 million.
The investments held at amortised cost are net of ECL provisions of £4.31
million, which were £0.11 million lower than the position as at 31 December
2024. £2.4 million of these ECL provisions relate to investments, which were
fully provided for as at 31 December 2024 and 30 June 2025 but not yet written
off. While there was a recovery of £0.14 million from a German sub-metering
investment, received in July 2025, it is not believed that there is a
reasonable prospect of recovery on the other two fully provided for
investments.
The other ECL provisions of £1.9 million are mainly attributable to the
remaining Superbonus investments, which reduced by £0.2 million due to the
repayment of Superbonus investments achieved in the period.
Apart from these projects, the Company has not experienced payment issues of
material significance on the receivables from amortised cost investments due
to be paid to it in the period.
As at 30 June 2025, the Company's seven fair value investments had a book
value of £2.23 million and comprised:
· four Solar PV projects in Spain with an aggregate value
of £0.77 million;
· two wind projects in the United Kingdom with an aggregate
value of £0.87 million; and
· a Solar PV project in Italy with a value of £0.59
million.
The changes in fair value of these investments are summarised in the chart
below.
The change in valuation of the investments held at fair value through profit
or loss, as reported above, was impacted primarily by operational issues with
the wind investments in the United Kingdom and Solar PV investments in Spain:
· The two wind investments in the UK, which had a value of
£1.03 million as at 31 December 2024, have been marked down further to a
value of £0.87 million as at 30 June 2025 due primarily to operational
problems at individual sites, which have resulted in lower than expected
electricity production and higher operation and maintenance costs.
· Two Solar PV investments in Spain, which had a value of
£0.40 million as at 31 December 2024, have been marked down further to a
value of £0.18 million as at 30 June 2025 due to operational difficulties
with individual projects and the failure of the ESCOs who developed the
projects to remedy these difficulties.
These operational issues have resulted in negative changes to the forecast
cash flows, referred to in the chart above as business plan updates, and
resulted in a negative change of -12.0%. Other impacts on valuation were:
· An overall increase in the discount rates applied to the
valuations, which had a negative effect of -1.7%
· FX effects, +2.1%;
· Distributions from these investments, -2.8%; and
· Valuation timing, that is the time value of money effect
between the two valuation dates, which had a positive effect of +4.1%.
Summary of Investments as at 30 June 2025
Description Receivables Term Technology Status Country Book Value
Weighted Avg. Credit
Years
as at 30 June 2025
Rating
£k
Subscription for Notes (fixed) entitling the Note holder to receivables BBB+/BBB- 9-15 Heat Pumps Water Management Sub-meters Operational Germany 10,855
generated through services agreements for heat pump systems, water management
services and sub-metering hardware and services in Germany.
Receivables (fixed) from sales of tax credits generated under the Italian CCC/CC 2 Building Retrofit Construction Italy 7,268
Superbonus, which supports energy efficiency retrofits of residential
buildings.
Receivables (fixed/variable) from solar PV plants and building refurbishment BBB+ / BBB- 10-18 Solar PV Operational Spain 6,129
projects in Spain.
Receivables (fixed/variable) from Solar PV projects in Italy. BBB+ / BBB- 7-10 Solar PV Operational Italy 3,722
Receivables (fixed/variable) from wind, CHP, metering and lighting as a BBB+ / BBB- 5-14 Wind Lighting CHP Metering Operational United Kingdom 2,654
service contracts in the UK.
Notes:
The term is the original maturity of the investment.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE ("ESG")
Introduction
The Company's goal is to generate attractive returns for investors by reducing
Primary Energy Consumption ("PEC"). The Company seeks to achieve this through
investing principally in a diversified portfolio of energy efficiency projects
with high-quality counterparties. The Company's investments positively impact
the environment by reducing the amount of carbon dioxide produced, by
decreasing PEC and by increasing the amount of renewable energy used.
The synergies(2) generated by the reduction of PEC and simultaneously using
renewable energy sources further decrease CO2 emissions.
This is reflected across the investment philosophy and approach of both the
Company and its Investment Adviser, Aquila Capital, who are dedicated to the
green energy transition. The Company is committed to being a responsible
investor, ensuring that environmental, social and governance criteria are
incorporated into day-to-day investment decisions as well as generating a
positive impact for society. By reducing PEC, the Company often improves life
standards for end users; for example, better lights, easier maintenance,
reduced danger, security of supply and, very importantly, the reduction of
emissions like Nitrogen Oxides. In the period, the portfolio performed as
follows:
· 2,248.4 tonnes of avoided CO2 emissions (tCO2e"); and
· 8,697 MWh of energy saved,
· for total emission savings equivalent to 1,027 passenger
flights around the world(3).
Method of Calculation for Energy Savings (kWh) and Avoided CO(2) Emissions (tCO(2)e)
The energy savings (in kWh) and avoided CO(2) emissions (in tCO(2)e) are
reported to Aquila Capital by third parties, including the development
companies, ESCOs and other third parties. These reports are supported by
asset-level documentation of individual methodologies. Aquila Capital has
reviewed the individual methodologies for technical consistency and reconciled
the reported values for plausibility. Where quantification of likely energy
savings and avoided CO(2) emissions is not clear, for example, with the
Superbonus projects in Italy and the water metering and heat pump projects in
Germany, no estimations are included in the avoided CO(2) emissions and energy
savings statistics above.
Only energy savings and avoided CO(2) emissions for operational projects are
considered on a pro-rata basis for the time of operation during the reporting
period. Avoided CO(2) emissions are estimated in gross terms and derived from
energy savings in kWh using a conversion factor (except CHP, see below) which
measures the grid's emission intensity. Emissions incurred during the life
cycle of light bulbs such as materials sourcing, manufacturing, installation,
maintenance etc. are not available. The reported metrics are estimations based
on assumptions. For technical reasons, it is not possible or feasible to
observe or measure actual energy or emission avoidance in real-time.
· LED/Lighting: Savings estimates are derived based on
technical, product-specific attributes provided by the product manufacturer.
Lighting assets are typically not connected to a distinct circuit. These
solutions are designed according to the requirements of a given functional
unit, i.e. office, street or space, which varies on asset level. Changes in
the number of light bulbs or lumen are not considered.
· Solar PV: Electricity production is translated into
emissions avoidance with a conversion factor (see above). Production estimates
for Solar PV assets are evaluated during technical due diligence processes.
· CHP: Avoided CO2 emissions are calculated directly by
comparing the asset's emissions based on the feedstock used for a specific
plant with a reference co-generation unit's emission factor.
2 International Renewable Energy Agency (Irena), "Synergies
between renewable energy and energy efficiency" (2017), available at:
https://www.irena.org/publications/2017/Aug/Synergies-between-enewable-energy-and-energy-efficiency#:~:text=Renewables%20would%20account%20for%20about,country%2C%20sector%20and%20
technology%20levels
3 Passenger flights around the world: This number is derived
from passenger flight emissions data retrieved on 4 April 2023 from the
International Civil Aviation Organization;
https://applications.icao.int/icec/Home/Index. The total emissions associated
with a passenger flight around the world based on a standard itinerary from
New York to Dubai, Bangkok, Sydney, Los Angeles and back to New York in the
economy class is 2,285.80 kg CO(2).
ESG Approach
The Company has adopted Aquila Capital's ESG Integration Policy(4), ensuring
that environmental, social and governance criteria have been incorporated into
day-to-day investment decisions as well as generating a positive contribution
for society. The Company investment approach is focused on investments in
energy efficiency projects located primarily in Europe. These investments are
predominantly into proven technologies that deliver energy savings for
commercial, industrial and public sector buildings. Prior to the adoption of
the New Investment Policy (as defined in the Interim Management Report issued
in September 2024), the Company sought to invest in projects for the long term
with a focus on optimising and improving the assets' PEC (and, of course, the
Company's investments continue to meet this initial objective). Technologies
include:
· LED Lighting Systems;
· Solar PV;
· HVAC/Buildings; and
· Bio LNG.
Environmental Contribution
The Company's investments are focused on reducing PEC, which should lead to
significant reductions in greenhouse gas emissions. In addition, local
production of energy (CHP, biomass boilers, Solar PV) reduces transportation
energy losses and grid over-utilisation. Smart meters and other control
technologies enable a better visibility and management of energy and therefore
represent a basis for energy savings.
Social Contribution
Energy efficiency measures not only reduce PEC, but typically also have a
positive impact on health and quality of life for different stakeholders, such
as employees and users of public facilities. This is largely achieved through
the installation of advanced solutions for lighting, heating, cooling,
ventilation and the associated control units. All project developers are
required to adhere to local, regional and national health and safety laws, to
train and educate employees accordingly, to make sure casualties and injuries
are avoided. Aquila Capital's ESG Integration Policy, as adopted by the
Company, has sought to exclude suppliers and manufacturers that do not meet
Aquila Capital's criteria (exclusion of certain sectors/subsectors, or
companies that, for example, use unfavourable labour conditions). For all
counterparties, a rating has been performed (in collaboration with a
third-party rating agency) assessing the creditworthiness of the relevant
counterparty as well as a "Know Your Client" check for the relevant parties
involved to increase transparency of the counterparties' activities.
Governmental Contribution
The Company's business partners are required to adhere to the requirements of
the relevant social security and tax authorities. The Company's business
partners are required to provide evidence that they adhere to anti-bribery and
corruption laws.
Due Diligence
The Investment Adviser performed detailed ESG due diligence for each asset
prior to investment. The investment management team followed a structured
screening, due diligence and investment process designed to ensure that
investments are reviewed and compared on a consistent basis. Execution of this
process is facilitated by the team's deep experience in energy efficiency
project investing. As part of this process, the Investment Adviser, as
relevant for each investment, considered:
· total PEC reduction, and implied CO(2) emissions reduced
and/or avoided; and/or
· total energy production from renewable and non-renewable
sources.
Governance Framework
The Company has an independent Board of Directors, with FundRock Management
Company (Guernsey) Limited (formerly Sanne Fund Management (Guernsey) Limited)
as the AIFM. The Board of Directors supervises the AIFM, which is responsible
for making recommendations in relation to any investment proposals put forward
by the Investment Adviser. The Investment Adviser is fully regulated and
supervised by BaFin in Germany. The Company maintains a comprehensive risk
register which is regularly updated and reviewed by the AIFM and the Board of
Directors. The Company has established procedures to deal with any potential
conflicts of interest in circumstances where Aquila Capital (or any affiliate)
is advising both the AIFM (for the Company) and other Aquila Capital managed
funds. In the context of an investment decision, these procedures may include
a fairness opinion in relation to the valuation of an investment, which is
obtained from an independent expert.
4 For details please refer to:
https://www.aquila-capital.de/fileadmin/user_upload/ESG_report/Aquila_Group_ESG_Integration_Policy.pdf
Monitoring of ESG
The Company's commitment to and compliance with the Company's established ESG
approach is monitored on a continuous basis throughout the lifecycle of
investments, as they become operational. This includes:
· ongoing monitoring of the PEC based on energy consumption
and deriving from that the CO(2) savings, where appropriate, monitoring
additional environment and ESG relevant developments both at the portfolio and
asset level; and
· annual reporting, including ESG aspects, to relevant
stakeholders including ad-hoc reporting of any material and urgent issues
identified in the monitoring process.
The Company has been awarded the Green Economy Mark from the London Stock
Exchange. The Green Economy Mark identifies London-listed companies and funds
that generate between 50% and 100% of total annual revenues from products and
services that contribute to the global green economy.
Aquila Capital Investmentgesellschaft mbH
22 September 2025
Interim Management Report
The Directors are required to provide an Interim Management Report in
accordance with the Financial Conduct Authority's ("FCA") Disclosure Guidance
and Transparency Rules ("DTR"). The Directors consider that the Chair's
Statement and the Investment Adviser's Report, provide details of the
important events which have occurred during the six months ended 30 June 2025
("the period") and their impact on the financial statements. The statement on
related party transactions, the Chair's Statement and the Investment Adviser's
Report and the Directors' Statement of Responsibility (below) together
constitute the Interim Management Report of the Company for the period. The
outlook for the Company for the remaining six months of the year ending 31
December 2025 is discussed in the Chair's Statement and the Investment
Adviser's Report.
A breakdown of the investments held at the period end can be found in the
Investment Adviser's Report.
Principal Risks and Uncertainties
The principal risks and uncertainties facing the Company are summarised below:
(i) Service provider risk
(ii) Counterparty / credit risk
(iii) Concentration risk
(iv) Discount management
(v) Portfolio valuation
(vi) Interest rates / inflation
(vii) Relationship with ESCOs during the run-off period
(viii) Capital preservation
(ix) IT security
(x) Act of war / sanctions
(xi) ESG
There has been no change in the reporting period to the emerging risk, namely
shrinking of the Company size relative to cost base.
Since the decision by shareholders on 28 February 2023 not to continue the
Company and the subsequent approval at the Annual General Meeting on 14 June
2023 of the Continuation and Managed Run-Off Resolution ("Managed Run-Off"),
the Board has paid and continues to pay particular attention on a regular
basis to the performance of its service providers, specifically in terms of
level of resource deployed in delivering services to the Company and the
standard of performance of those services.
The Company's Annual Report for the period ended 31 December 2024 contains
more detail on the Company's principal risks and uncertainties and emerging
risks, including the Board's ongoing process to identify, and where possible
mitigate, the risks (pages 19 to 23). The Annual Report can be found on the
Company's website.
Related Party Transactions
Details of the investment advisory arrangements were provided in the Annual
Report. There have been no changes to the related party transactions described
in the Annual Report that could have a material effect on the financial
position or performance of the Company. Amounts payable to the Investment
Adviser in the period are detailed in the unaudited Statement of Profit or
Loss and Comprehensive Income.
Going Concern
The Directors have adopted the going concern basis in preparing the financial
statements. The following is a summary of the Directors' assessment of the
going concern status of the Group and Company.
The Group and Company continue to meet day-to-day liquidity needs through
their cash resources. The Directors have a reasonable expectation that the
Group and Company have adequate resources to continue in operational existence
for at least twelve months from the date of this document.
In reaching this conclusion, the Directors have considered the Group's
investment commitments, cash position, income and expense flows. As at 22
September 2025, the latest practicable date before publication of this report,
the total investment commitments were nil. The value of investments at 30 June
2025 was £30.63 million and has not changed materially since that date. The
investments are mostly fully operational and income producing. As at
31 August 2025, the Group had cash of £10.9 million (including the £2.5
million held as collateral for FX hedging). The Directors reviewed downside
scenarios which assumed some delay in cash receipts and are satisfied that the
Group and the Company would continue to meet its obligations as they fall due
and are also satisfied that the Group and Company would continue to remain
viable under downside scenarios. Total expenses for the period were £1.39
million (excluding impairment losses) (30 June 2024: £1.43 million), which,
when annualised, represented approximately 3.9% of average net assets during
the period (30 June 2024: 3.2%). At the date of approval of this document,
based on the aggregate of investments and cash held, the Group and Company
have substantial operating expenses cover.
As per the investment policy , approved by the shareholders on 14 June 2023,
the Company entered a continuation and managed run-off of its portfolio,
meaning that it is not making any new investments (save for the limited
circumstances as set out in the New Investment Policy) and its investing
activity is solely in respect of funding legal commitments to existing
investments.
The Company entered into agreements to realise its Bio-LNG investment in
Germany and majority of its Italian Superbonus investments for a combined
gross consideration of €31.84 million with the aim to make significant
distribution to the shareholders. The Company declared a special interim
dividend of 36.837 pence per ordinary share on 29 April 2025. In addition, the
Board of Directors has declared an interim dividend of 4.00 pence per ordinary
share in respect of the first six months of the financial year ending 31
December 2025 payable on 24 October 2025 to Shareholders on the register on 3
October 2025. The ex-dividend date is 2 October 2025.
As referred to above, the Group is operating under a Managed Run-Off with the
term of some of the Group's assets being several years. While the Company is
continuing to explore other strategic options, such as an asset sale or
structural solution, there remains no certainty that any of these options will
materialise and be put to Shareholders for consideration, or on the potential
timing of other strategic options.
Accordingly, the Directors recognise that these conditions indicate the
existence of material uncertainty which may cast significant doubt about the
Group and Company's ability to continue as a going concern.
Based on the assessment and considerations above, the Directors have concluded
that the financial statements of the Group and the Company should be prepared
on a going concern basis. The financial statements do not include the
adjustments that would result if the Group and the Company were unable to
continue on a going concern basis.
Directors' Statement of Responsibility
The Directors confirm to the best of their knowledge that:
· the condensed set of financial statements contained
within the Interim Financial Report has been prepared in accordance with IAS
34 Interim Financial Reporting and gives a true and fair view of the assets,
liabilities, financial position and return of the Company;
· the Interim Management Report includes a fair review of
the information required by Disclosure and Transparency Rule 4.2.7R; and
· the Interim Financial Report includes a fair review of
the information required by Disclosure and Transparency Rule 4.2.8R.
Miriam Greenwood OBE DL
Chair of the Board of Directors
22 September 2025
David Fletcher
Chair of the Audit & Risk Committee
22 September 2025
FINANCIAL STATEMENTS
CONSOLIDATED INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
For the six months ended For the six months ended For the year ended
30 June 2025 30 June 2024 31 December 2024
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Losses on investments at fair value through profit or loss - (610) (610) - (2,176) (2,176) - (2,077) (2,077)
Unrealised loss on derivatives - (24) (24) - (29) (29) - (24) (24)
Realised (loss)/gain on derivatives - (737) (737) - 1,932 1,932 - 3,493 3,493
Net foreign exchange gain/(loss) - 1,938 1,938 - (237) (237) - (3,241) (3,241)
Investment income 4 1,880 - 1,880 3,270 - 3,270 5,397 - 5,397
Investment advisory fees (226) - (226) (328) - (328) (647) - (647)
Impairment write back/(loss) 112 - 112 (515) - (515) (2,554) - (2,554)
Other expenses (1,163) - (1,163) (1,103) - (1,103) (2,374) - (2,374)
Net return/(loss) before taxation 603 567 1,170 1,324 (510) 814 (178) (1,849) (2,027)
Taxation 5 - - - - - - - - -
Net return/(loss) after taxation 603 567 1,170 1,324 (510) 814 (178) (1,849) (2,027)
Return/(loss) per share 6 0.74p 0.70p 1.44p 1.39p (0.54p) 0.85p (0.20p) (2.09p) (2.29p)
The "Total" column of this statement is the profit and loss account of the
Group. The "Revenue" and "Capital" columns represent supplementary information
prepared under guidance issued by The Association of Investment Companies. The
Group has no other items of other comprehensive income, and therefore the net
return/(loss) after taxation is also the total comprehensive income/(loss) for
the period. All revenue and capital items in the above statement derive from
continuing operations. No operations were acquired or discontinued in the
period.
COMPANY INCOME STATEMENT
FOR THE SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
For the six months ended
For the six months ended
For the year ended
30 June 2025
30 June 2024
31 December 2024
Revenue Capital Total Revenue Capital Total Revenue Capital Total
Notes £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000 £'000
Losses on investments at fair value through profit or loss - (2,551) (2,551) - (15) (15) - (1,299) (1,299)
Net foreign exchange loss - (1,005) (1,005) - (81) (81) - (1,728) (1,728)
Investment income 4 4,961 - 4,961 2,368 - 2,368 4,203 - 4,203
Investment advisory fees (226) - (226) (328) - (328) (647) - (647)
Other expenses (1,037) - (1,037) (829) - (829) (1,939) - (1,939)
Impairment loss (375) - (375) - - - (923) - (923)
Net return/(loss) before taxation 3,323 (3,556) (233) 1,211 (96) 1,115 694 (3,027) (2,333)
Taxation 5 - - - - - - - - -
Net return/(loss) after taxation 3,323 (3,556) (233) 1,211 (96) 1,115 694 (3,027) (2,333)
Return/(loss) per share 6 4.08p (4.37p) (0.29p) 1.27p (0.10p) 1.17p 0.79p (3.43p) (2.64p)
The "Total" column of this statement is the profit and loss account of the
Company. The "Revenue" and "Capital" columns represent supplementary
information prepared under guidance issued by The Association of Investment
Companies. The Company has no other items of other comprehensive income, and
therefore the net return/(loss) after taxation is also the total comprehensive
income/(loss) for the period. All revenue and capital items in the above
statement derive from continuing operations. No operations were acquired or
discontinued in the period.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
30 June 30 June 31 December
2025 2024 2024
Notes £'000 £'000 £'000
Fixed assets
Investments at fair value through profit or loss 10 2,232 12,974 10,022
Investments at amortised cost 28,396 51,852 46,309
30,628 64,826 56,331
Current assets
Trade and other receivables 112 37 80
Cash and cash equivalents 10,990 13,663 14,417
11,102 13,700 14,497
Creditors: amounts falling due within one year
Payables (868) (1,069) (1,137)
Derivative financial instrument (24) (28) (24)
Net current assets 10,210 12,603 13,336
Total assets less current liabilities 40,838 77,429 69,667
Net assets 40,838 77,429 69,667
Capital and reserves
Share capital 8 814 814 814
Capital redemption reserve 186 186 186
Special reserve 40,914 75,834 70,913
Capital reserve (1,460) (688) (2,027)
Revenue reserve 384 1,283 (219)
Total equity shareholders' funds 40,838 77,429 69,667
Net asset value per share 9 50.15p 95.08p 85.55p
Number of shares in issue 81,438,268 81,438,268 81,438,268
Aquila Energy Efficiency Trust Plc is incorporated in England and Wales with
company registration number 13324616.
COMPANY STATEMENT OF FINANCIAL POSITION
AT 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
30 June 30 June 31 December
2025 2024 2024
Notes £'000 £'000 £'000
Fixed assets
Investment in SPV Project 2013 S.r.l. at fair value through profit or loss 10 10,023 34,089 29,351
Investment in Attika Holdings Limited at amortised cost 8,673 9,971 9,048
Investment in subsidiaries 18,696 44,060 38,399
Current assets
Shareholder loan receivable 27,514 27,293 27,292
Intercompany balance with Attika Holdings Limited - 2,705 -
Trade and other receivables 1,154 1,225 56
Cash and cash equivalents 4,946 3,899 7,620
33,614 35,122 34,968
Creditors: amounts falling due within one year
Intercompany balance with Attika Holdings Limited (11,817) - (2,443)
Payables (769) (857) (968)
Net current assets 21,028 34,265 31,557
Total assets less current liabilities 39,724 78,325 69,956
Net assets 39,724 78,325 69,956
Capital and reserves
Share capital 8 814 814 814
Capital redemption reserve 186 186 186
Special reserve 40,914 75,834 70,913
Capital reserve (3,660) 2,827 (104)
Revenue reserve 1,470 (1,336) (1,853)
Total equity shareholders' funds 39,724 78,325 69,956
Aquila Energy Efficiency Trust Plc is incorporated in England and Wales with
company registration number 13324616.
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Six months ended 30 June 2025 (unaudited) Notes £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2024 814 186 70,913 (2,027) (219) 69,667
Dividend paid in the period 7 - - (29,999) - - (29,999)
Return for the period - - - 567 603 1,170
At 30 June 2025 814 186 40,914 (1,460) 384 40,838
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Six months ended 30 June 2024 (unaudited) £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2023 1,000 - 93,500 (178) (41) 94,281
Repurchase and cancellation of the Company's own shares following a Tender (186) 186 (17,500) - - (17,500)
Offer
Expenses of Tender Offer - - (166) - - (166)
(Loss)/return for the period - - - (510) 1,324 814
At 30 June 2024 814 186 75,834 (688) 1,283 77,429
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Year ended 31 December 2024 (audited) £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2023 1,000 - 93,500 (178) (41) 94,281
Repurchase and cancellation of the Company's own shares following a Tender (186) 186 (17,500) - - (17,500)
Offer
Expenses of Tender Offer - - (88) - - (88)
Dividend paid in the year 7 - - (4,999) - - (4,999)
Loss for the year - - - (1,849) (178) (2,027)
At 31 December 2024 814 186 70,913 (2,027) (219) 69,667
COMPANY STATEMENT OF CHANGES IN EQUITY
SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Six months ended 30 June 2025 (unaudited) Notes £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2024 814 186 70,913 (104) (1,853) 69,956
Dividend paid in the period 7 - - (29,999) - - (29,999)
(Loss)/return for the period - - - (3,556) 3,323 (233)
At 30 June 2025 814 186 40,914 (3,660) 1,470 39,724
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Six months ended 30 June 2024 (unaudited) £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2023 1,000 - 93,500 2,923 (2,547) 94,876
Repurchase and cancellation of the Company's own shares following a Tender (186) 186 (17,500) - - (17,500)
Offer
Expenses of Tender Offer - - (166) - - (166)
(Loss)/return for the period - - - (96) 1,211 1,115
At 30 June 2024 814 186 75,834 2,827 (1,336) 78,325
Capital
Share redemption Special Capital Revenue
capital reserve reserve reserve reserve Total
Year ended 31 December 2024 (audited) £'000 £'000 £'000 £'000 £'000 £'000
At 31 December 2023 1,000 - 93,500 2,923 (2,547) 94,876
Repurchase and cancellation of the Company's own shares following a Tender (186) 186 (17,500) - - (17,500)
Offer
Expenses of Tender Offer - - (88) - - (88)
Dividend paid in the year 7 - - (4,999) - - (4,999)
(Loss)/return for the year - - - (3,027) 694 (2,333)
At 31 December 2024 814 186 70,913 (104) (1,853) 69,956
CONSOLIDATED STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
six months six months Year ended
ended ended 31 December
30 June 2025 30 June 2024 2024
Notes £'000 £'000 £'000
Operating activities
Profit/(loss) on ordinary activities before taxation 1,170 814 (2,027)
Adjustments for:
Unrealised loss on investments 447 2,176 2,060
Unrealised loss on derivative instruments 24 29 24
Realised loss on investments 163 - 17
Impairment (gain)/loss (112) 515 2,554
Unrealised foreign exchange (gain)/loss (1,324) 87 3,241
(Increase)/decrease in trade receivables (32) 615 572
(Decrease)/increase in creditors: amounts falling due within one year (269) 12 80
Interest receivable from amortised cost investments (1,158) (529) (4,008)
Net cash (outflow)/inflow from operating activities (1,091) 3,719 2,513
Investing activities
Purchase of investments - (4,202) (4,224)
Repayment of investments 27,801 2,579 9,894
Net cash inflow/(outflow) from investing 27,801 (1,623) 5,670
Financing activities
Tender Offer payment - (17,500) (17,500)
Expenses of Tender Offer - (166) (88)
Dividend paid 7 (29,999) - (4,999)
Net cash outflow from financing (29,999) (17,666) (22,587)
Decrease in cash (3,289) (15,570) (14,404)
Cash and cash equivalents at the start of the period 14,417 29,082 29,082
Effect of foreign currency exchange translation (138) 151 (261)
Cash and cash equivalents at the end of the period 10,990 13,663 14,417
COMPANY STATEMENT OF CASH FLOWS
FOR THE SIX MONTHS ENDED 30 JUNE 2025 (UNAUDITED)
(Unaudited) (Unaudited) (Audited)
six months six months Year ended
ended ended 31 December
30 June 2025 30 June 2024 2024
Notes £'000 £'000 £'000
Operating activities
(Loss)/profit on ordinary activities before taxation (233) 1,115 (2,333)
Adjustments for:
Unrealised losses on investments 2,551 15 1,299
Net foreign exchange loss 1,005 81 1,728
Shareholder loan interest income (1,078) (1,080) (1,936)
Impairment loss 375 - 923
Movement in intercompany balances 9,374 (2,705) 2,443
(Increase)/decrease in trade receivables (1,098) (970) 199
(Decrease)/increase in creditors: amounts falling due within one year (199) (17) 94
Net cash inflow/(outflow) from operating activities 10,697 (3,561) 2,417
Investing activities
Purchase of investments - (294) (294)
Repayment of investments 15,788 1,843 3,724
Net cash inflow from investing 15,788 1,549 3,430
Financing activities
Loan to subsidiary (222) - 1
Shareholder loan interest income received 1,078 1,080 1,936
Tender Offer payment - (17,500) (17,500)
Expenses of Tender Offer - (166) (88)
Dividends paid 7 (29,999) - (4,999)
Net cash outflow from financing (29,143) (16,586) (20,650)
Decrease in cash (2,658) (18,598) (14,803)
Cash and cash equivalents at the start of the period 7,620 22,548 22,548
Effect of foreign currency exchange translation (16) (51) (125)
Cash and cash equivalents at the end of the period 4,946 3,899 7,620
NOTES TO THE FINANCIAL STATEMENTS
FOR THE SIX MONTHS TO 30 JUNE 2025
1. FINANCIAL STATEMENTS
The information contained within the financial statements in this half-year
report has not been audited or reviewed by the Company's independent auditors.
The figures and financial information for the year ended 31 December 2024 are
extracted from the latest published financial statements of the Group and
Company, and do not constitute statutory financial statements for that year.
Those financial statements have been delivered to the Registrar of Companies
and included the report of the auditors which was unqualified and did not
contain a statement under either section 498(2) or 498(3) of the Companies
Act 2006.
This half year report will be made available to the public at the registered
office of the Company. The report will be available in electronic format on
the Company's website (https://www.aquila- energy-efficiency-trust.com).
2. BASIS OF PREPARATION
The consolidated accounts of the Group and the accounts of the Company have
both been prepared in accordance with International Accounting Standard 34
"Interim Financial Reporting" and the accounting policies set out in the
statutory accounts of the Group and Company for the year ended 31 December
2024. Where presentational guidance set out in the Statement of Recommended
Practice (the "SORP") for investment trusts issued by the Association of
Investment Companies in July 2022, is consistent with the requirements of
International Financial Reporting Standards, the financial statements have
been prepared on a basis compliant with the recommendations of the SORP.
3. VALUATION CALCULATIONS
Investments at fair value
Investments at fair value are valued by the Investment Adviser, and this
requires the use of estimates and assumptions. Details of the basis of
valuation of investments at fair value is consistent with that detailed in
note 2 to the financial statements for the year ended 31 December 2024,
presented on pages 69 and 70 of the annual report. Details of the valuation
methodology and the valuation assumptions and inputs are given note 4 to those
financial statements on pages 76 and 77.
Investments at amortised cost
Investments held at amortised cost require the calculation of expected credit
loss ("ECL"). The accounting policy for ECL is consistent with that detailed
in note 3 to the financial statements for the year ended 31 December 2024,
presented on page 73. Details of the measurement of ECL are given in note 4 to
those financial statements on pages 78 and 79.
4. INVESTMENT INCOME
Group (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended 30 June 2025 ended 30 June 2024 31 December
£'000 £'000 2024
£'000
Investment interest income 1,492 2,755 4,679
Bank interest 388 515 718
Total income 1,880 3,270 5,397
Company (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended ended 31 December
30 June 2025 30 June 2024 2024
£'000 £'000 £'000
Investment interest income 4,704 2,019 3,797
Bank interest 257 349 406
Total income 4,961 2,368 4,203
5. TAXATION
The Group's and Company's effective corporation tax rate is nil, as deductible
expenses and interest distributions exceed taxable income.
6. RETURN/(LOSS) PER SHARE
Group (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended 30 June 2025 ended 30 June 2024 31 December
2024
Revenue return/(loss) after taxation (£'000) 603 1,324 (178)
Capital return/(loss) after taxation (£'000) 567 (510) (1,849)
Return/(loss) after tax (£'000) 1,170 814 (2,027)
Weighted average number of shares in issue during the period 81,438,268 95,308,573 88,335,524
Revenue return/(loss) per share 0.74p 1.39p (0.20)p
Capital return/(loss) per share 0.70p (0.54)p (2.09)p
Total return/(loss) per share 1.44p 0.85p (2.29)p
Company (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended 30 June 2025 ended 30 June 2024 31 December
2024
Revenue return after taxation (£'000) 3,323 1,211 694
Capital loss after taxation (£'000) (3,556) (96) (3,027)
(Loss)/return after tax (£'000) (233) 1,115 (2,333)
Weighted average number of shares in issue during the period 81,438,268 95,308,573 88,335,524
Revenue return per share 4.08p 1.27p 0.79p
Capital loss per share (4.37)p (0.10)p (3.43)p
Total (loss)/return per share (0.29)p 1.17p (2.64)p
There are no diluted returns per share as there are no dilutive or potentially
dilutive instruments in issue.
7. DIVIDENDS PAID
Total dividends paid in the period (Unaudited) (Unaudited) (Audited) Year ended
Six months Six months 31 December
ended 30 June 2025 ended 30 June 2024 2024
£'000 £'000 £'000
Interim paid on 1 November 2024 of 6.139p per share - - 4,999
Interim paid on 30 May 2025 of 36.837p per share 29,999 - -
29,999 - 4,999
Total dividends declared in the period (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended 30 June 2025 ended 31 December
£'000 30 June 2024 2024
£'000 £'000
30 June 2025: Interim payable on 3 November 2025 of 4.00p per share (30 Jun 3,257 4,999 -
2024: 6.139p per share)
8. SHARE CAPITAL
Changes in called-up share capital during the period were as follows:
Ordinary shares of 1p each, allotted, called-up and fully paid (Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended ended 31 December
30 June 2025
30 June 2024
2024
£'000 £'000
£'000
Opening balance of shares of 1p each 814 1,000 1,000
Shares purchased and cancelled following a Tender Offer - (186) (186)
Subtotal of shares of 1p each 814 814 814
Changes in the number of shares in issue during the period were as follows:
(Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended ended 31 December
30 June 2025
30 June 2024
2024
Opening balance of shares in issue 81,438,268 100,000,000 100,000,000
Shares purchased and cancelled following a Tender Offer - (18,561,732) (18,561,732)
Closing balance of shares in issue 81,438,268 81,438,268 81,438,268
9. NET ASSET VALUE ("NAV") PER SHARE
Group (Unaudited) (Unaudited) (Audited)
30 June 2025 30 June 2024 31 December
2024
NAV (£'000) 40,838 77,429 69,667
Closing balance of shares in issue 81,438,268 81,438,268 81,438,268
NAV per share 50.15p 95.08p 85.55p
10. FINANCIAL INSTRUMENTS MEASURED AT FAIR VALUE
The Group's financial instruments that are held at fair value comprise its
investment portfolio and derivative financial instruments. The recognition and
measurement policies for financial instruments measured at fair value have not
changed from those set out in the statutory accounts of the Group for the year
ended 31 December 2024.
IFRS 13 requires that financial instruments held at fair value are categorised
into a hierarchy comprising the following three levels:
Level 1 - valued using quoted prices in active markets.
Level 2 - valued by reference to valuation techniques using observable inputs
other than quoted market prices included within Level 1.
Level 3 - valued by reference to valuation techniques using inputs that are
not based on observable market data.
Categorisation within the hierarchy has been determined on the basis of the
lowest level input that is significant to the fair value measurement of the
relevant asset.
At 30 June 2025, the Group's investments and derivative financial instruments
held at fair value were categorised as follows:
(Unaudited) (Unaudited) (Audited)
30 June 2025 30 June 2024 31 December
£'000 £'000 2024
£'000
Level 1 - - -
Level 2 - Derivative financial instruments (24) (28) (24)
Level 3 - Investments 2,232 12,974 10,022
Total 2,208 12,946 9,998
There have been no transfers between Levels 1, 2 or 3 during the period
(period ended 30 June 2024 and year ended 31 December 2024: nil).
The movements in the Level 3 investments of the Group during the period were
as follows:
(Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended ended 31 December
30 June 2025
30 June 2024
2024
Opening balance 10,022 10,492 10,492
Additions during the period - 3,662 3,683
Disposals during the period (7,260) (127) (1,564)
Realised losses (163) - (17)
Unrealised losses (367) (1,053) (2,572)
Closing balance 2,232 12,974 10,022
At 30 June 2025, the Company's investments held at fair value were categorised
as follows:
(Audited)
(Unaudited) (Unaudited) 31 December
30 June 2025 30 June 2024 2024
£'000 £'000 £'000
Level 1 - - -
Level 2 - - -
Level 3 10,023 34,089 29,351
Total 10,023 34,089 29,351
There have been no transfers between Levels 1, 2 or 3 during the period
(period ended 30 June 2024 and year ended 31 December 2024: nil).
The movements in the Level 3 investments of the Company during the period were
as follows:
(Unaudited) (Unaudited) (Audited)
Six months Six months Year ended
ended ended 31 December
30 June 2025
30 June 2024
2024
Opening balance 29,351 35,683 35,683
Additions during the period - 294 294
Repayments during the period (15,788) (1,873) (3,724)
Unrealised losses (3,540) (15) (2,902)
Closing balance 10,023 34,089 29,351
11. EVENTS AFTER THE INTERIM PERIOD THAT HAVE NOT BEEN REFLECTED IN THE
FINANCIAL STATEMENTS FOR THE INTERIM PERIOD
The Directors have evaluated the period since the interim date and have not
noted any events which have not been reflected in the financial statements.
OTHER INFORMATION
ALTERNATIVE PERFORMANCE MEASURES ("APMS")
The financial measures below are classified as APMs as defined by the European
Securities and Markets Authority. Under this definition, APMs include a
financial measure of historical performance or financial position, other than
a financial measure defined or specified in the applicable financial reporting
framework.These measures are commonly used by investment companies to assess
values, investment performance and operating costs. Numerical calculations are
given where appropriate.
Discount
The amount by which the share price of an investment trust is lower (discount)
or higher (premium) than the NAV per share. The discount or premium is
expressed as a percentage of the NAV per share. If the shares are trading at a
discount, investors would be paying less than the value attributable to the
shares as calculated in accordance with generally accepted accounting
practice. The discount or premium is expressed as a percentage of the NAV per
share. The discount at the period end was as follows:
30 June 2025 30 June 2024 31 December 2024
NAV per share a 50.15p 95.08p 85.55p
Share price b 33.70p 59.00p 52.00p
Discount (b/a)-1 (32.8%) (37.9%) (39.2%)
Ongoing charges Ratio ("OCR")
The OCR is calculated in accordance with The Association of Investment
Companies' recommended methodology and represents the annualised management
fee and all other annualised recurring operating expenses excluding any
finance costs and transaction costs, expressed as a percentage of the average
net asset values during the period.
Six months Six months Year ended
ended ended 31 December
30 June 2025
30 June 2024
2024
Annualised expenses (£'000) a 2,466 2,862 3,021
Average NAV (£,000) b 62,613 88,416 80,459
OCR a/b 3.9% 3.2% 3.8%
Total return
Total return is the combined effect of any dividends paid, together with the
rise or fall in the NAV per share or share price. Total return statistics
enable the investor to make performance comparisons between investment
companies with different dividend policies.
Total return is calculated as follows:
Six months ended Six months ended Year ended
30 June 2025
30 June 2024
31 December 2024
NAV Share price NAV Share price NAV Share price
per share per share per share
At 31 December 2024 a 85.55p 52.00p 94.28p 57.25p 94.28p 57.25p
Dividend paid in the period b 36.837p 36.837p - - 6.14p 6.14p
At 30 June 2025 c 50.15p 33.70p 95.08p 59.00p 85.55p 52.00p
Total return/(loss) (b+c)/a -1 1.7% 35.6% 0.8% 3.1% (2.7%) 1.6%
GLOSSARY
AIC Association of Investment Companies.
Alternative Investment Fund or "AIF" An investment vehicle under AIFMD. Under AIFMD (see below) Aquila Energy
Efficiency Trust Plc is classified as an AIF.
Alternative Investment Fund Managers Directive or "AIFMD" A European Union directive which came into force on 22 July 2013 and has been
implemented in the UK.
Annual General Meeting or "AGM" A meeting held once a year which Shareholders can attend and where they can
vote on resolutions to be put forward at the meeting and ask directors
questions about the company in which they are invested.
the Company Aquila Energy Efficiency Trust Plc.
Discount The amount, expressed as a percentage, by which the share price is less than
the net asset value per share.
Dividend Income receivable from an investment in shares.
Ex-dividend date The date from which you are not entitled to receive a dividend which has been
declared and is due to be paid to Shareholders.
ESCO Energy Service Company.
EU European Union.
Financial Conduct Authority or "FCA" The independent body that regulates the financial services industry in the UK.
General Meeting ''GM'' A meeting which Shareholders can attend and where they can vote on resolutions
to be put forward at the meeting and ask directors questions about the company
in which they are invested.
GWh Gigawatt hour.
Group The Company, Holdco and Italian SPV.
the Holdco Attika Holdings Limited ("AHL" or "Attika").
Investment company A company formed to invest in a diversified portfolio of assets.
Investment Trust An investment company which is based in the UK and which meets certain tax
conditions which enables it to be exempt from UK corporation tax on its
capital gains. The Company is an investment trust.
IPO Initial Public Offering.
Italian SPV or "SPV" SPV Project 2013 S.r.l.
Liquidity The extent to which investments can be sold at short notice.
Net assets or net asset value ('NAV') An investment company's assets less its liabilities.
NAV per Ordinary Share Net assets divided by the number of Ordinary Shares in issue (excluding any
shares held in treasury).
Ongoing charges A measure of the regular, recurring annual costs of running an investment
company, expressed as a percentage of average net assets.
Ordinary Shares The Company's ordinary shares in issue.
Period The six months to 30 June 2025.
Portfolio A collection of different investments held in order to deliver returns to
Shareholders and to spread risk.
Share price The price of a share as determined by a relevant stock market.
Total return A measure of performance that takes into account both income and capital
returns. This may take into account capital gains, dividends, interests and
other realised variables over a given period of time.
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