Bluefield Solar Inc. - NAV Update and £20m Share Buyback Programme

Bluefield Solar Income Fund

15/02/2024 07:00

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RNS Number : 1960D  Bluefield Solar Income Fund Limited  15 February 2024

15 February 2024

 

Bluefield Solar Income Fund Limited

('Bluefield Solar' or the 'Company')

 

NAV Update and £20m Share Buyback Programme

 

 Dividend Guidance Reaffirmed with Earnings Cover for the Full Year of
Approximately Two Times

Bluefield Solar (LON: BSIF), the London listed UK income fund focused
primarily on acquiring and managing solar energy assets, has today announced
the Unaudited Directors' Valuation as at 31 December 2023, equivalent to a Net
Asset Value ("NAV") of £831.3 million, or 136.0 pps (September 2023 136.4
pps, June 2023 139.7 pps).

Unaudited Net Asset Value as of 31 December 2023

Key movements in the NAV since 30 September 2023 include recognition of value
from the Company's Renewable Energy Guarantees of Origin certificates
("REGOs") until 2030, which have been included in the valuation for the first
time owing to sustained market prices over the last 12 months and expectations
of future value from forecasters. In addition, the Company has recognised a
slight uplift in expected power prices due to a small increase in long term
power forecasts whilst short term hedging has predominantly offset reductions
from near term power price weakness. There was additionally a minor negative
adjustment due to operational cost updates and working capital movements.

The discount rate being applied remains unchanged at 8.0% (30 September 23:
8.00%) and inflation assumptions also remain unchanged from 30 September 23
(2024:3.5%, 2025-2029:3.0%, 2.25% thereafter). All other core assumptions also
remain unchanged.

                                          Pence per Ordinary Share
   Unaudited NAV as at 30 September 2023  136.4

   REGOs                                  0.9
   Power prices                           0.4
   Operational cost update                -1.0
   Other movements                        -0.7

   Unaudited NAV as at 31 December 2023   136.0

Full details on the movements for the 6 month period to 31 December 2023 will
be outlined in the Company's Interim Statement due for release on 28 February
2024.

 

 

 

Share Buyback Programme

 

The Board notes the recent weakness in the Company's share price and the
significant discount that the current share price represents to the value of
the Company's assets. Adjusting for the first interim dividend , the closing
price of 99 pence per share (as at 14 February 2024) represents a discount of
26% to the 31 December 2023 NAV.

 

The Board of the Company keeps its capital allocation policy under regular
review, evaluating the relative merits of further investment (into both new
and existing assets), the management of debt and returning value to
shareholders via dividends or through other methods such as share buybacks. As
part of this review, and in the context of addressing what the Board views as
the excessive discount at which the Company's shares currently trade relative
to the underlying NAV, the Board announces its intention to commence a share
buyback programme. In the first instance it has allocated £20 million for the
purchase of its own shares.

 

Share repurchases will be carried out under the existing shareholder authority
granted at the last Annual General Meeting, held on 28 November 2023, which
allows for purchases of Ordinary Shares by the Company in the market for up to
14.99% of the Company's issued share capital. Any share repurchases will be
funded from a combination of available liquidity, excess operating cash flows
from the portfolio and the proceeds from any asset sales as already announced.
It is expected that any share repurchases will be accretive to NAV per share.

 

The Company expects to announce its interim results for the half year ended 31
December 2023 on Wednesday, 28 February 2024. Until such announcement, the
Company remains in a closed period in respect of those results and thus unable
to buy its own shares, but the Board intends to commence share buybacks
following the release of the interims and while the Company's shares continue
to trade at an excessive discount to NAV.

 

Dividend Guidance Reaffirmed

 

Shareholders will be aware that the Board of Bluefield Solar has recently
declared a first interim dividend for the current financial year of 2.20 pps
and has reiterated its target dividend for the full year of not less than 8.80
pps. This represents a dividend yield of 8.9%  based on the closing share
price of 99p per share on 14 February 2024. The Company's operations remain
robust, trading conditions are attractive, and the Board expects this year's
dividend to be approximately two times covered.

 

- Ends -

 

 

 For further information:

                                                           Tel: +44 (0) 20 7078 0020

                                                         www.bluefieldllp.com
 Bluefield Partners LLP (Company Investment Adviser)
 James Armstrong / Neil Wood / Giovanni Terranova

 Deutsche Numis (Company Broker)                           Tel: +44 (0) 20 7260 1000
 Tod Davis / David Benda / Matt Goss                       www.dbnumis.com

 Ocorian                                                   Tel: +44 (0) 1481 742 742

(Company Secretary & Administrator)                      www.ocorian.com
 Chezi Hanford

 Media enquiries:                                          Tel: +44 (0) 20 7466 5000

Buchanan (PR Adviser)                                    www.buchanan.uk.com
 Henry Harrison-Topham / Henry Wilson                      BSIF@buchanan.uk.com

 

 

About Bluefield Solar

 

Bluefield Solar is a London listed income fund focused primarily on acquiring
and managing solar energy assets.  Not less than 75% of the Company's gross
assets will be invested into UK solar assets.  The Company can also invest up
to 25% of its gross assets into other technologies, such as wind and storage.
Bluefield Solar owns and operates a UK portfolio of 834MW, comprising 776MW of
solar and 58MW of onshore wind.

 

Further information can be viewed at www.bluefieldsif.com

 

About Bluefield Partners

 

Bluefield Partners LLP was established in 2009 and is an investment adviser to
companies and funds investing in renewable energy infrastructure.  It has a
proven record in the selection, acquisition and supervision of large-scale
energy assets in the UK and Europe.  The team has been involved in over £6.5
billion renewable funds and/or transactions in both the UK and Europe,
including over £1 billion in the UK since December 2011.

 

Bluefield Partners LLP has led the acquisitions of, and currently advises on,
over 100 UK based solar PV assets that are agriculturally, commercially or
industrially situated.  Based in its London office, it is supported by a
dedicated and experienced team of investment, legal and portfolio
executives.  Bluefield Partners LLP was appointed Investment Adviser to
Bluefield Solar in June 2013.

 

 

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