REG - Ecofin US Renewables - Half-yearly Report
26/09/2024 07:00
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RNS Number : 7031F Ecofin US Renewables Infrastr.Trust 26 September 2024
ECOFIN U.S. RENEWABLES INFRASTRUCTURE TRUST PLC
(the "Company" or "RNEW")
Half-yearly Report for the six months ended 30 June 2024
Investment Objective
The Company's investment objective is to provide Shareholders with an
attractive level of current distributions by investing in a diversified
portfolio of mixed renewable energy and sustainable infrastructure assets
("Renewable Assets") predominantly located in the U.S. with prospects for
modest capital appreciation over the long term.
Why RNEW?
RNEW targets attractive risk-adjusted returns through a differentiated
investment strategy focused on the middle market of U.S. renewable energy:
l Fully invested portfolio: Diversified portfolio of U.S. renewable
energy assets with an attractive long-term income stream;
l Stable income: Portfolio generating 100% contracted revenues
offering geographical diversification; and
l U.S. renewables market with promising growth outlook: $360 billion
growth opportunity projected over the next decade with historic unified
government support to achieve the 2035 carbon-free U.S. power sector goal.
Highlights
Financial
As at 30 June 2024
65.0 cents $89.8 million 52.0 cents(2)
51.4 pence(1) £71.0 million(1) 41.1 pence(2)
Net Asset Value ("NAV") per share NAV Share price
47%(3)
Leverage
For the period ended 30 June 2024 ("Period")
(22.2)%(4) (5.6)%(4) 0.70 cents
NAV total return Share price total return Dividends per share declared
Operational
13.2 years(5) 65 152 GWh(6)
Weighted average remaining term of Assets Clean electricity generated in H1 2024
revenue contracts
177 MW(6)
Portfolio generating capacity
Figures reported either as at the referenced date or over the six months ended
30 June 2024. All references to cents and dollars ($) are to the currency of
the U.S., unless stated otherwise.
1. 30 June 2024 exchange rate of £0.79101 = $1.00
2. RNEW & RNEP LSE closing price as at 30 June 2024
3. Calculated based on Gross Asset Value ("GAV") and aggregate debt.
4. These are alternative performance measures. ("APMs"). Definitions
of these APMs and how other performance measures used by the Company have been
calculated can be found at the last section of this report.
5. Includes all construction-stage and committed assets.
6. Represents the Company's share of portfolio generating capacity
(including assets under construction).
Invested and committed assets
l As at 30 June 2024, RNEW's diversified renewable energy portfolio
consisted of 65 assets spread across eight states with a total capacity of 177
MW that generated 152.0 GWh of clean electricity in the Period and included:
l operating solar assets generating 91.6 GWh
l operating wind asset generating 60 GWh
l No major health and safety incidents occurred across the portfolio
during the Period, other than those discussed below regarding the Whirlwind
asset.
l In respect of the reporting period, the Company declared dividends
of 0.70 cents per Share in total(7).
l The Company's NAV was $89.8 million or 65 cents per Share at 30 June
2024. The NAV total return over the Period was (22.2)%.
l The Company's U.S. subsidiaries had $49.0 million(8) of long term,
non-recourse project-specific debt at a project level representing
approximately 28.5% of GAV and $30.0 million(8) of short-term debt at holding
company level representing approximately 17.5% of GAV.
Financial information As at or period to As at or year to
30 June 2024 31 December 2023
Net assets (million) $89.8 $117.7
Shares in issue (million) 138.1 138.1
NAV per share (cents) 65.0 85.2
Share price (cents) 52.0 56.5
Share price discount to NAV(10) 20.0% 33.7%
Dividends declared per share (cents)⁹ 0.7 3.5
NAV total return per share(10) (22.2)% (5.5)%
Share price total return(10) (5.6)% (24.7)%
Cash (million) $2.5 $1.6
Leverage (million) $79.0 $75.8
7. The Company's ability to distribute dividends is determined by the
existence of sufficient distributable reserves, legislative requirements and
available cash reserves.
8. Represents the Company's proportionate share of total debt at the
asset special purpose vehicle ("SPV") level across its existing investments as
at 30 June 2024.
9. Dividends declared relating to the Period/year.
10. These are alternative performance measures ("APMs"). Definitions of
these APMs and how other performance measures used by the Company are
calculated can be found at the last section of this report.
CHAIR'S STATEMENT
On behalf of the Board, I present the Company's half-yearly report for the six
months ended 30 June 2024.
This remains a difficult time for your fund. RNEW's share price continues to
trade at a discount to Net Asset Value (NAV) and, while progress has been
made, the Company still faces a number of operational challenges. As announced
on 9 September 2024, the Company will be seeking shareholder approval to
implement a managed wind-down of its assets.
Strategic Review
The Company announced a strategic review on 8 September 2023 and appointed
Marathon Capital ("Marathon"), as financial adviser, to undertake a process
focused on a sale of all the Company's assets. An extensive marketing exercise
was undertaken by Marathon but unfortunately no buyer was identified for the
Company's entire portfolio on acceptable terms. Accordingly, following careful
consideration of the options available to the Company, and on advice from
Marathon and taking into account feedback from shareholders, the Board now
believes it would be in the best interests of shareholders to implement a
managed wind down of the Company (the "Managed Wind Down") and this was
announced on 9 September 2024.
Under the Managed Wind Down, the Board will seek to implement an incremental
sales programme of the Company's assets in an orderly manner with a view to
repaying borrowings and subsequently making returns of capital to shareholders
while aiming to obtain the best available value for the Company's assets at
the time of their realisations.
A circular will be prepared and posted to shareholders in due course seeking
approval for the implementation of the Managed Wind Down and amendment of the
Company's existing investment policy ("Investment Policy"). The first sale of
assets under the Managed Wind Down is progressing and assuming a transaction
is agreed will be announced in due course and will be subject to shareholder
approval of the Managed Wind Down.
Investment Manager
The ability of the Investment Manager to continue managing the Company has
been impacted by the uncertainty and time to implement a transaction under the
strategic review. In addition, the Investment Manager has informed the Company
that there is a refocussing of the strategy of the wider Tortoise-Ecofin
group, of which the Investment Manager is part, away from the renewable energy
sector. As a result, it has become apparent to the Board that it will likely
become necessary to consider alternative management arrangements for the
Company at some point going forward. In July, Brett Miller was appointed to
the Board. Brett has wide-ranging investment trust experience, particularly in
the restructuring and managed run-off of a number of listed closed end funds
across a range of asset classes, delivering value to shareholders. Brett also
has considerable experience in overseeing changes to management arrangements
of listed funds.
Operational update
During H1 2024, RNEW's portfolio, which comprises 65 solar and wind assets
with a combined capacity of 177 MW across eight states, generated 152 GWh of
clean electricity (30 June 2023: 157 GWh). The decline in output was
principally due to reduced output from the Company's Whirlwind windfarm
following the destruction by a tornado in June 2023 of the Matador sub-station
to which the windfarm was connected.
l Whirlwind was reconnected in December 2023 to Paducah, another
sub-station owned by AEP, the owner of the Matador sub-station, at a maximum
capacity of 50MW. However, because of oscillation issues, which despite
substantive investigation have not been fully resolved, ERCOT, the grid
operator in Texas, has curtailed Whirlwind to 30MW. The windfarm should return
to its full generating capacity of 59MW when the Matador sub-station, which is
currently being rebuilt, comes online, expected to be in Q4 2024 or Q1 2025.
l The Echo Solar portfolio comprises six solar projects in Minnesota,
Virginia and Delaware. The projects have experienced delays. The Company is
seeking liquidated damages in respect these delays.
l Other operational issues contributing to the decrease in output
included inverter faults at both the Beacon 2 and Beacon 5 solar assets in
California.
Valuation
The unaudited NAV as at 30 June 2024 was 65.0 cents per share (31 December
2023: 85.2 cents per share), a decrease of 23.7%, principally as the result of
a 1.1% increase in discount rate.
The portfolio valuation as at 30 June 2024 is supported by an independent
valuation firm, Marshall & Stevens ('M&S'). The basis of valuation is
discounted cash flow, assuming a willing buyer and a willing seller on an
asset-by-asset basis and using appropriate discount rates for each asset. The
blended weighted average pre-tax discount rate at 30 June 2024 was 8.51%
(31 December 2023: 7.4%). The increase in discount rate was based on
M&S's assessment of: comparable data; sales multiples or recent M&A
transactions; and current illiquidity in the M&A marketplace.
The basis of valuation relies on financial forecasts which by their very
nature are uncertain. The forecasts and projections are based upon assumptions
about events and circumstances which have not yet transpired. The Company
cannot provide any assurance that the estimates will be representative of the
cash flows which will actually be achieved during the forecast period.
If these assumptions are not correct or do not hold true, the valuations
could change materially. The Manager confirmed that the information provided
to M&S for their valuation was materially complete, fair in the manner of
its portrayal and, therefore, forms a reliable basis for the valuation.
As the Company moves into Managed Wind Down, the ultimate determinant of
values will be what willing buyers are prepared to pay for the Company's
investments.
Results
RNEW's losses before tax for the six months to 30 June 2024 were $25.9 million
(2023: $429,000 profit) and losses per Share were 18.79 cents per Share (2023:
0.3 cents profit).
The Company's total gearing at 30 June 2024 was 47.0% (31 December 2023:
38.0%), based on gross asset value (GAV) of $167.8 million and aggregate debt
of $79 million. The Company had both non-recourse debt at project level ($45
million secured on the two Beacon projects and $4 million secured on the Echo
Solar portfolio) and debt at group level, consisting of $30 million drawn
under the Company's revolving credit facility (RCF).
The RCF consists of a $50 million tranche, which matures on 18 October 2024
and a $15 million tranche which matures on 18 October 2025. Discussions are
ongoing with KeyBank, the RCF provider, regarding extension/renewal of the
facility.
Dividends
During H1 2024, the Board declared two interim dividends of 0.7 cents per
Share each, in respect of the quarters ended 31 March 2024 and 31 December
2023. As part of the announcement on 9 September 2024, the Board stated that
it had decided not to declare a dividend for Q2 2024 so as to focus the
Company's cash-flow towards the repayment of borrowings in anticipation of
future returns of capital to shareholders.
Board
As noted earlier, Brett Miller was appointed to the Board in July 2024.
Louisa Vincent, who joined the Board in October 2020 and has played a key part
in the development of the Company, has decided to step down from the Board
with effect from 31 October 2024. Together with my fellow Directors, I would
like to thank Louisa for her significant contribution.
The Board currently comprises five directors (two women and three men) who
together have a good balance of sector, investment trust and wider financial
investment experience, including significant experience in the US renewable
energy sector.
I would like to thank my fellow directors, the Ecofin team and all our
advisers for their input in the year to date, particularly in connection with
the strategic review and the subsequent decision to implement a Managed Wind
Down.
Patrick O'D Bourke
Chair of the Board
25 September 2024
INVESTMENT MANAGER'S REPORT
During the six months ended 30 June 2024, the portfolio generated 152.0 GWh of
clean energy, 27.5% below budget.
Of the total, solar assets generated 91.6 GWh, 15.4% below budget and wind
assets generated 60.0 GWh, 40.3% below budget. The portfolio's 100% contracted
revenue structure generated revenues of $3.2 million for the Company in H1
2024. As at 30 June 2024, RNEW's portfolio had 100% of its revenue contracted
with a weighted average remaining term of 13.2 years. Approximately 99% of the
portfolio benefits from fixed-price revenues, many with annual escalators of
1-2%, through PPAs, contracted solar renewable energy credits ("SREC"), and
fixed rents under leases. These fixed price contracts mitigate market price
risk for the term of the contracts. Less than 1% of the portfolio has a
variable form of revenue, which is set at a fixed discount to a defined
Massachusetts utility electric rate.
Cash flows were below budget primarily due to the previously reported
situation with the Matador substation at Whirlwind following the tornado in
summer 2023, the ongoing delays in bringing the Echo portfolio of projects
online, and operational issues at several other projects.
Whirlwind
The Whirlwind wind farm has faced continuing challenges this half-year,
operating 40.3% below budgeted production in H1 2024. Following the June 2023
tornado which destroyed the Matador substation through which Whirlwind
transmitted energy, the site has been rerouted through a neighboring
substation in Paducah TX. As a result of oscillation and instability issues on
this temporary, extended line to Paducah, ERCOT has curtailed the site's
output to 30 MW until the newly rebuilt Matador substation comes online. The
Matador restoration is expected to be complete by the end of 2024.
An insurance consultant was hired in July 2023 to assist with a business
interruption claim, which included an analysis of wind speed data and missed
generation to calculate potential revenue losses. Several insurance payments
have already been received relating to this claim, and final payments will be
made later this year. Whirlwind is also working with NAES (Balance of Plant
manager) and Siemens Gamesa (turbine O&M manager) to integrate a data feed
into the production database, which will help analyze production drivers and
performance more effectively.
Echo Solar Assets
The Echo Solar Portfolio, comprising six solar projects in Minnesota,
Virginia, and Delaware, has experienced delays primarily due to
underperformance by the developer. The final Echo project declared its
Commercial Operations Date (COD) in August 2024. Closing of tax equity for the
project is expected to take place in October, along with the remaining
drawdown of the back-leverage facility. The company is pursuing liquidated
damages from the developer due to the delays.
Beacon 2 and Beacon 5
The Beacon 2 and Beacon 5 solar assets also faced issues during H1 2024.
Beacon 2 underperformed by 18.7%, mainly due to issues with inverters, with a
thermal event in March 2024 causing an oil leak in an inverter. Beacon 5
underperformed by 12.9%, with inverters also experiencing faults in early May.
Repairs for these inverters are pending and an insurance claim is being
investigated for lost production and property damage at Beacon 2. In a related
initiative, Ecofin together with the projects' co-owner, S&B Energy, are
exploring a Battery Energy Storage Solution (BESS) at the Beacon site to
enhance value. There are also proposals to extend the PPA, and attract new tax
equity from Production Tax Credits (PTCs). A feasibility study, conducted by
consultants DNV in December 2023 is currently under evaluation.
Other Projects
The Ellis Road Solar Project underperformed against budget by 18.2% during H1
2024 due to a storm in April that caused a ground fault, forcing the site
offline for two weeks.
The Oliver Solar Project also slightly underperformed, by 3.8%, during H1
2024. Ongoing capacity testing has failed to identify a point of failure at
Oliver, leading to the filing by Ecofin of a notice of Substantial Completion
Liquidated Damages. Upon successful testing, Ecofin plans to proceed with
final tax equity funding, expected in Q4 2024.
The Skillman Solar Project underperformed versus budget by 8.4% during H1
2024, primarily due to the failure of several inverters early in the quarter.
Two inverters are currently offline and are in the process of being replaced
under warranty.
In contrast, the Delran Solar Project, operational since June 2020, performed
at budget for the half-year. Cash flow for Delran is based on a predetermined
sale-leaseback structure, which will continue through the end of 2025.
The SED portfolio, which comprises 52 rooftop solar assets in Massachusetts
and Connecticut slightly underperformed versus budget by 1.2% during H1 2024
due to strong insolation during June, offsetting lower insolation in April and
May due to late season snow and rain. SED's O&M provider has continued the
replacement of aging inverters and cores across the portfolio during H1 2024.
INVESTMENT OBJECTIVE AND INVESTMENT POLICY
As disclosed in the announcement released on 9 September 2024, the Board
intends to seek shareholder approval to amend the Company's investment policy
in order to facilitate the managed wind down process. Prior to the change in
the Company's investment policy, its investment objective and investment
policy (including defined terms) is as follows:
Investment objective
The Company's investment objective is to provide Shareholders with an
attractive level of current distributions by investing in a diversified
portfolio of mixed renewable energy and sustainable infrastructure assets
("Renewable Assets") predominantly located in the United States with prospects
for modest capital appreciation over the long term.
Investment policy and strategy
The Company intends to execute its investment objective by investing in a
diversified portfolio of Renewable Assets predominantly in the United States,
but it may also invest in other OECD countries.
Whilst the principal focus of the Company will be on investment in Renewable
Assets that are solar and wind energy assets ("Solar Assets" and "Wind Assets"
respectively), sectors eligible for investment by the Company will also
include different types of renewable energy (including battery storage,
biomass, hydroelectric and microgrids) as well as other sustainable
infrastructure assets such as water and waste water.
The Company will seek to invest primarily through privately negotiated middle
market acquisitions of long-life Renewable Assets which are
construction-ready, in-construction and/or currently in operation with
long-term PPAs or comparable offtake contracts with investment grade quality
counterparties, including utilities, municipalities, universities, schools,
hospitals, foundations, corporations and others. Long-life Renewable Assets
are those which are typically expected by Ecofin to generate revenue from
inception for at least 10 years.
The Company intends to hold the Portfolio over the long term, provided that it
may dispose of individual Renewable Assets from time to time.
Investment restrictions
The Company will invest in a diversified portfolio of Renewable Assets subject
to the following investment limitations which, other than as specified below,
shall be measured at the time of the investment:
l once the Net Initial Proceeds are substantially fully invested, a
minimum of 20 per cent. of Gross Assets will be invested in Solar Assets;
l once the Net Initial Proceeds are substantially fully invested, a
minimum of 20 per cent. of Gross Assets will be invested in Wind Assets;
l a maximum of 10 per cent. of Gross Assets will be invested in
Renewable Assets that are not Wind Assets or Solar Assets;
l exposure to any single Renewable Asset will not exceed 25 per cent.
of Gross Assets;
l exposure to any single Offtaker will not exceed 25 per cent. of
Gross Assets;
l once the Net Initial Proceeds are substantially fully invested,
investment in Renewable Assets that are in the construction phase will not
exceed 50 per cent. of Gross Assets, but prior to such time investment in such
Renewable Assets will not exceed 75 per cent. of Gross Assets. The Company
expects that construction will be primarily focused on Solar Assets in the
shorter term until the Portfolio is more substantially invested and may
thereafter include Wind Assets in the construction phase;
l exposure to Renewable Assets that are in the development (namely
pre-construction) phase will not exceed 5 per cent. of Gross Assets;
l exposure to any single developer in the development phase will not
exceed 2.5 per cent. of Gross Assets;
l the Company will not typically provide Forward Funding for
development projects. Such Forward Funding will, in any event, not exceed 5
per cent. of Gross Assets in aggregate and 2.5 per cent. of Gross Assets per
development project and would only be undertaken when supported by customary
security;
l Future Commitments and Developer Liquidity Payments, when aggregated
with Forward Funding (if any), will not exceed 25 per cent. of Gross Assets;
l once the Net Initial Proceeds are substantially fully invested,
Renewable Assets in the United States will represent at least 85 per cent. of
Gross Assets; and
l any Renewable Assets that are located outside of the United States
will only be located in other OECD countries. Such Renewable Assets will
represent not more than 15 per cent. of Gross Assets.
References in the investment restrictions detailed above to "investments in"
or "exposure to" shall relate to the Company's interests held through its
Investment Interests.
For the purposes of the 2020 IPO Prospectus, the Net Initial Proceeds will be
deemed to have been substantially fully invested when at least 75 per cent. of
the Net Initial Proceeds have been invested in (or have been committed in
accordance with binding agreements to invest in) Renewable Assets.
The Company will not be required to dispose of any investment or to rebalance
the Portfolio as a result of a change in the respective valuations of its
assets. The investment limits detailed above will apply to the Group as a
whole on a look-through basis, namely, where assets are held through a Project
SPV or other intermediate holding entities or special purpose vehicles, and
the Company will look through the holding vehicle to the underlying assets
when applying the investment limits.
Gearing policy
The Group primarily intends to use long-term debt to provide leverage for
investment in Renewable Assets and may utilize short‑term debt, including,
but not limited to, a revolving credit facility, to assist with the
acquisition of investments.
Long-term debt shall not exceed 50 per cent. of Gross Assets and short-term
debt shall not exceed 25 per cent. of Gross Assets, provided that total debt
of the Group shall not exceed 65 per cent. of Gross Assets, in each case,
measured at the point of entry into or acquiring such debt.
The Company may employ gearing either at the level of the relevant Project SPV
or at the level of any intermediate subsidiary of the Company. Gearing may
also be employed at the Company level, and any limits set out in this
Prospectus shall apply on a consolidated basis across the Company, the Project
SPVs and any such intermediate holding entities (but will not count any
intra‑Group debt). The Company expects debt to be denominated primarily in
U.S. dollars.
For the avoidance of doubt, financing provided by tax equity investors and any
investments by the Company in its Project SPVs or intermediate holding
companies which are structured as debt are not considered gearing for this
purpose and are not subject to the restrictions in the Company's gearing
policy.
Currency and hedging policy
The Group may use derivatives for the purposes of hedging, partially or fully:
l electricity price risk relating to any electricity or other benefit
including renewable energy credits or incentives, generated from Renewable
Assets not sold under a PPA, as further described below;
l currency risk in relation to any Sterling (or other non-U.S. Dollar)
denominated operational expenses of the Company;
l other project risks that can be cost-effectively managed through
derivatives (including, without limitation, weather risk); and
l interest rate risk associated with the Company's debt facilities.
In order to hedge electricity price risk, the Company may enter into
specialised derivatives, such as contracts for difference or other hedging
arrangements, which may be part of a tripartite or other PPA arrangement in
certain wholesale markets where such arrangements are required to provide an
effective fixed price under the PPA.
Members of the Group will only enter into hedging or other derivative
contracts when they reasonably expect to have an exposure to a price or rate
risk that is the subject of the hedge.
Cash management policy
Until the Company is fully invested the Company will invest in cash, cash
equivalents, near cash instruments and money market instruments and treasury
notes ("Near Cash Instruments"). Pending re-investment or distribution of cash
receipts, the Company may also invest in Near Cash Instruments as well as
Investment Grade Bonds and exchange traded funds or similar ("Liquid
Securities"), provided that the Company's aggregate holding in Liquid
Securities shall not exceed 10 per cent. of Gross Assets measured at the point
of time of acquiring such securities.
Amendments to the investment objective, policy and investment restrictions
If the Board considers it appropriate to amend materially the investment
objective, investment policy or investment restrictions of the Company,
Shareholder approval to any such amendment will be sought by way of an
ordinary resolution proposed at an annual or other general meeting of the
Company.
INTERIM MANAGEMENT REPORT
The Directors are required to provide an Interim Management Report in
accordance with the FCA Disclosure Guidance and Transparency Rules. They
consider that the Chair's Statement and the Investment Manager's Report in
this Half-yearly Report provide details of the important events which have
occurred during the Period and their impact on the financial statements. The
following statements on related party transactions, going concern and the
Directors' Responsibility Statement below, together with the Chair's Statement
and the Investment Manager's Report, constitute the Interim Management Report
for the Company for the six months ended 30 June 2024.
Principal Risks and Uncertainties
The Directors have identified the following as the Company's principal risks
and uncertainties. These are described in the Company's Annual Report for the
year ended 31 December 2023 (pages 28 - 30):
1. Electricity price
2. Interest rate, currency and inflation
3. Investment performance
4. Operational performance
5. Investment Valuation
6. Political & Regulatory
7. Discount Management
8. Cyber
9. Service Provider Reliance
10. Counterparty
11. Climate
12. ESG
13. Financing
Should shareholders approve the Managed Wind-Down of the Company which is
expected to be proposed within the forthcoming six month period, the Board
believe that the conclusion of the Managed Wind-Down would become an
additional principal risk with no certainty that the Board will achieve
attractive prices on behalf of shareholders. All other principal risks as
listed above will remain equally applicable for the remaining six months of
the year.
Related Party Transactions
The Company's Investment Manager, Ecofin, is considered a related party under
the Listing Rules. Details of the amounts paid to the Company's Investment
Manager and the Directors during the Period are detailed in Note 11 to the
Financial Statements.
Going Concern
The Directors have adopted the going concern basis in preparing the interim
financial statements. The following is a summary of the Directors' assessment
of the going concern status of the Company.
In reaching their conclusion, the Directors considered the Company's cash flow
forecasts, cash and net debt position, and the financial covenants in its
borrowing facilities. The Company's net assets at 30 June 2024 were $89.8
million (31 December 2023: $117.7 million). As at 30 June 2024, the Company
held $2.5 million in cash (31 December 2023: $1.6 million), had borrowings at
group level of $30.0 million (31 December 2023: $26.8 million) and $35 million
headroom on its RCF (31 December 2023: $38 million).
The Company's holds 100% of the share capital of which in turn holds
investments in renewable energy project companies through SPVs. Underlying SPV
revenues are derived from the sale of electricity by project companies under
PPAs in place with creditworthy utilities, municipalities, and corporations.
Most of these PPAs are contracted over a long period with a weighted average
remaining life as at 30 June 2024 of 13.2 years (31 December 2023: 13.7
years).
The Company continues to meet its day-to-day liquidity needs through its cash
resources. Total expenses for the Period were $946,000 (30 June 2023: $1.1
million), which represented approximately 1.05% of average net assets during
the Period (30 June 2023: 0.89%). At the date of approval of this Half-yearly
Report, based on the aggregate of investments and cash held, the Company had
substantial cover for its operating expenses. Further, the Company has the
ability to draw on its $65 million RCF. The Company and underlying SPVs
continue to comply with debt covenants.
The first tranche of the Company's RCF amounting to $50 million, matures in
October 2024 and the second tranche, amounting to $15 million, matures in
October 2025. Discussions are ongoing with KeyBank, the provider of the RCF,
regarding extension/renewal of the facility. The Directors have a reasonable
expectation that the RCF will be extended as required (or that alternative
lenders will be obtained) but until such facilities are formally renewed there
can be no certainty that the required funding will be in place within the
required time frame. The Directors acknowledge that this may indicate the
existence of material uncertainty which may cast significant doubt about the
Company's ability to continue as a going concern.
The major cash outflow of the Company is the payment of dividends. The
Directors review financial reporting and forecasts at each quarterly Audit
Committee meeting, including reporting related to indebtedness, compliance
with borrowing covenants and fund investment limits. The Board has decided not
to declare a dividend for Q2 2024 but instead to focus the Company's
cash-flows towards the repayment of borrowings in anticipation of future
returns of capital to shareholders. The Directors are confident that the
Company has sufficient cash balances, borrowing headroom and anticipated tax
equity arrangements in order to fund the commitments detailed in note 12 to
the financial statements, should they become payable.
The Directors have fully considered each of the Company's investments. Other
than described in this report, the Directors do not foresee any immediate
material risk to the Company's investment portfolio and/or the income it
receives from underlying SPVs. A prolonged and deep market decline could lead
to falling values in the underlying investments or interruptions to cashflow,
however the Company currently has sufficient liquidity available to meet its
future obligations. The Company's ability to continue as a going concern has
been assessed by the Directors for a period of at least 12 months from the
date the financial statements were authorised for publication.
Directors' Statement of Responsibility for the Half-Yearly Report
The Directors confirm to the best of their knowledge that:
l The condensed set of financial statements contained within the interim
financial report has been prepared in accordance with FRS 104 Interim
Financial Reporting; and
l The Interim Management Report includes a fair review of the information
required by 4.2.7R and 4.2.8R of the FCA's Disclosure Guidance and
Transparency Rules.
Patrick O'D Bourke
Chair
For and on behalf of the Board of Directors
25 September 2024
FINANCIAL STATEMENTS
UNAUDITED CONDENSED STATEMENT OF COMPREHENSIVE INCOME
For the six months ended 30 June 2024
For the six months ended For the six months ended
30 June 2024 30 June 2023
(Unaudited) (Unaudited)
Revenue Capital Total Revenue Capital Total
Notes $'000 $'000 $'000 $'000 $'000 $'000
Losses on investments 3 - (28,203) (28,203) - (2,091) (2,091)
Net foreign exchange gains - 2 2 - 16 16
Income 4 3,208 - 3,208 3,648 - 3,648
Investment management fees 5 (498) - (498) (637) - (637)
Other expenses (448) - (448) (507) - (507)
(Loss)/profit on ordinary activities before taxation 2,262 (28,201) (25,939) 2,504 (2,075) 429
Taxation - - - - - -
(Loss)/profit on ordinary activities after taxation 2,262 (28,201) (25,939) 2,504 (2,075) 429
Earnings per Share (cents) - basic and diluted 6 1.64c (20.43c) (18.79c) 1.81c (1.50c) 0.31c
The total column of the Condensed Statement of Comprehensive Income is the
profit and loss account of the Company.
All revenue and capital items in the above statement derive from continuing
operations. No operations were acquired or discontinued during the six months
to 30 June 2024 (the "Period").
Profit on ordinary activities after taxation is also the "Total comprehensive
profit for the Period".
The accompanying notes form part of these interim financial statements.
UNAUDITED CONDENSED STATEMENT OF FINANCIAL POSITION
As at 30 June 2024
As at As at
30 June 31 December
2024 2023
(Unaudited) (Audited)
Notes $'000 $'000
Non-current assets
Investments at fair value through profit or loss 3 88,595 116,798
Current assets
Cash and cash equivalents 2,508 1,648
Trade and other receivables 53 8
2,561 1,656
Current liabilities: amounts falling due within one year
Trade and other payables (403) (795)
Dividend payable (966) -
(1,369) (795)
Net current assets 1,192 861
Net assets 89,787 117,659
Capital and reserves: equity
Share capital 7 1,381 1,381
Share premium 12,732 12,732
Special distributable reserve 8 121,250 121,250
Capital reserve (45,906) (17,705)
Revenue reserve 330 1
Total Shareholders' funds 89,787 117,659
Net assets per Ordinary Share (cents) 9 65.0c 85.2c
No. of ordinary shares in issue 138,078,496 138,078,496
Approved and authorised by the Board of directors for issue on 25 September
2024.
Patrick O'D Bourke
Chair of the Board
The accompanying notes form part of these interim financial statements.
Ecofin U.S. Renewables Infrastructure Trust PLC is incorporated in England and
Wales with company number 12809472.
UNAUDITED CONDENSED STATEMENT OF CHANGES IN EQUITY
For the six months ended 30 June 2024
Six months ended 30 June 2024 (Unaudited)
Special
Share Share distributable Capital Revenue
capital premium reserve reserve reserve Total
Notes $'000 $'000 $'000 $'000 $'000 $'000
Opening equity as at 1 January 2024 1,381 12,732 121,250 (17,705) 1 117,659
Transactions with Shareholders
Dividend distribution 10 - - - - (1,933) (1,933)
Total transactions with shareholders - - - - (1,933) (1,933)
Profit/(loss) and total comprehensive income for the Period - - - (28,201) 2,262 (25,939)
Closing equity as at 30 June 2024 1,381 12,732 121,250 (45,906) 330 89,787
Six months ended 30 June 2023 (Unaudited)
Special
Share Share distributable Capital Revenue
capital premium reserve reserve reserve Total
Notes $'000 $'000 $'000 $'000 $'000 $'000
Opening equity as at 1 January 2023 1,381 12,732 121,250 (7,123) 1,947 130,187
Transactions with Shareholders
Dividend distribution 10 - - - - (3,866) (3,866)
Total transactions with shareholders 1,381 12,732 121,250 (7,123) (1,919) 126,321
Profit/(loss) and total comprehensive income for the Period - - - (2,075) 2,504 429
Closing equity as at 30 June 2023 1,381 12,732 121,250 (9,198) 585 126,750
The accompanying notes form part of these interim financial statements.
UNAUDITED CONDENSED STATEMENT OF CASH FLOWS
For the six months ended 30 June 2024
Six months Six months
ended 30 June ended 30 June
2024 2023
(Unaudited) (Unaudited)
Notes $'000 $'000
Operating activities
(Loss)/profit on ordinary activities before taxation (25,939) 429
Adjustment for unrealised losses on investments 28,203 2,091
Increase in trade and other receivables (45) (17)
Decrease in trade and other payables (392) (121)
Net cash flow from operating activities 1,827 2,382
Financing activities
Dividends paid 10 (967) (3,866)
Net cash flow used in financing activities (967) (3,866)
Increase/(decrease) in cash 860 (1,484)
Cash and cash equivalents at start of the Period 1,648 3,394
Cash and cash equivalents at end of the Period 2,508 1,910
At 30 June At 30 June
2024 2023
(Unaudited) (Unaudited)
$'000 $'000
Cash and cash equivalents
Money market cash deposits 2,508 1,910
Total cash and cash equivalents at end of the Period 2,508 1,910
The accompanying notes form part of these interim financial statements.
NOTES TO THE INTERIM FINANCIAL STATEMENTS
For the six months ended 30 June 2024
1. General Information
Ecofin U.S. Renewables Infrastructure Trust PLC ("RNEW" or the "Company") is a
public company limited by shares incorporated in England and Wales on 12
August 2020 with registered number 12809472. The Company is a closed-end
investment company with an indefinite life. The Company commenced operations
on 22 December 2020 when its Shares were admitted to trading on the London
Stock Exchange. The Directors intend, at all times, to conduct the affairs of
the Company as to enable it to qualify as an investment trust for the purposes
of section 1158 of the Corporation Tax Act 2010, as amended.
The registered office and principal place of business of the Company is 6th
Floor, 125 London Wall, London, EC2Y 5AS.
The Company's investment objective is to provide Shareholders with an
attractive level of current distributions, by investing in a diversified
portfolio of mixed renewable energy and sustainable infrastructure assets
predominantly located in the U.S. with prospects for modest capital
appreciation over the long term.
The financial statements comprise only the results of the Company, as its
investment in RNEW Holdco, LLC ("Holdco") is included at fair value through
profit or loss as detailed in the key accounting policies below.
The Company's Alternative Investment Fund Manager ("AIFM") and Investment
Manager is Ecofin Advisors, LLC.
Apex Listed Companies Services (UK) Limited provides administrative and
company secretarial services to the Company under the terms of an
administration agreement.
2. Basis of Preparation
The unaudited interim financial statements of the Company have been prepared
in accordance with IAS 34 "Interim Financial Reporting". The accounting
policies, critical accounting judgements, estimates and assumptions are
consistent with those used in the latest audited financial statements for the
year ended 31 December 2023. The interim financial statements have been
prepared in accordance with UK-adopted international accounting standards. The
interim financial statements are prepared on the historical cost basis, except
for the revaluation of certain financial instruments at fair value through
profit or loss ("FVTPL").
The interim financial statements have also been prepared as far as is relevant
and applicable to the Company in accordance with the Statement of Recommended
Practice ("SORP") issued by the Association of Investment Companies ("AIC") in
July 2022.
These condensed interim financial statements do not include all information
and disclosures required in the annual financial statements and should be read
in conjunction with the Company's annual financial statements for the year
ended 31 December 2023. The audited annual accounts for the year ended 31
December 2023 have been delivered to Companies House. The audit report thereon
was unqualified.
The functional currency of the Company is U.S. Dollars as this is the currency
of the primary economic environment in which the Company operates and where
its investments are located. The Company's investment is denominated in U.S.
Dollars and a substantial majority of its income is receivable, and of its
expenses is payable, in U.S. Dollars. Also, a majority of the Company's cash
and cash equivalent balances is retained in U.S. Dollars. Accordingly, the
interim financial statements are presented in U.S. Dollars rounded to the
nearest thousand dollars.
Basis of consolidation
The Company has adopted the amendments to IFRS 10 which state that investment
entities should measure all of their subsidiaries that are themselves
investment entities at fair value.
The Company owns 100% of its subsidiary Holdco and invests in SPVs through its
investment in Holdco. The Company and Holdco meet the definition of an
investment entity as described by IFRS 10. Under IFRS 10, investment entities
measure subsidiaries at fair value rather than being consolidated on a
line-by-line basis, meaning Holdco's cash, debt and working capital balances
are included in investments held at fair value rather than in the Company's
current assets. Holdco has one investor, which is the Company. In substance,
Holdco is investing the funds of the investors in the Company on its behalf
and is effectively performing investment management services on behalf of such
unrelated beneficiary investors.
Going concern
The Directors have adopted the going concern basis in preparing the financial
statements. In reaching their conclusion, the Directors considered the
Company's cash flow forecasts, cash and net debt position, and the financial
covenants in its borrowing facilities. Details of the Directors' assessment
are given in the Going Concern section.
Critical accounting judgements, estimates and assumptions
Preparation of financial statements requires management to make judgements,
estimates and assumptions that affect the application of accounting policies
and the reported amount of assets, liabilities, income and expenses. Estimates
are, by their nature, based on judgement and available information, hence
actual results may differ from these judgements, estimates and assumptions.
The estimates and assumptions that have a significant risk of causing a
material adjustment to the carrying value of assets and liabilities are those
used to determine the fair value of the investments as disclosed in note 3 to
the interim financial statements.
Key estimation and uncertainty: Investments at fair value through profit or
loss
The Company's investments in unquoted investments are valued by reference to
valuation techniques approved by the Directors and in accordance with the
International Private Equity and Venture Capital Valuation ("IPEV")
Guidelines.
The Company uses discounted cash flow ("DCF") models to determine the fair
value of the underlying assets in Holdco. The value of Holdco includes any
working capital not accounted for in the DCF models (deferred tax liabilities,
cash plus any receivables or payables at the entity and not at the asset
level). The fair value of each asset is derived by projecting its future cash
flows, based on a range of operating assumptions for revenues and expenses,
and discounting those future cash flows to the balance sheet date using a
discount rate appropriately calibrated to the risk profile of the asset and
market dynamics. The key estimates and assumptions used within the DCF models
are consistent with those used in the latest audited financial statements to
31 December 2023 and include discount rates, annual energy production,
curtailment, merchant power prices, useful life of the assets, and various
operating expenses and associated annual escalation rates often tied to
inflation, including operations and maintenance, asset management, balance of
plant, land leases, insurance, property and other taxes and decommissioning
bonds, among other items. An increase/(decrease) in the key valuation
assumptions would lead to a corresponding decrease/(increase) in the fair
value of the investments. The Company's investments at fair value are not
traded in active markets.
Segmental reporting
The Chief Operating Decision Maker, which is the Board, is of the opinion that
the Company is engaged in a single segment of business, being investment in
renewable energy infrastructure assets to generate investment returns whilst
preserving capital. The financial information used by the Chief Operating
Decision Maker to manage the Company presents the business as a single
segment.
3. Investment Held at Fair Value Through Profit or Loss
As at 30 June 2024, the Company had one investment, being Holdco. The cost of
the investment in Holdco is US$ 134,065,000 (31 December 2023: US$
134,065,000).
As at As at
30 June 2024 31 December 2023
Total Total
$'000 $'000
(a) Summary of valuation
Analysis of closing balance:
Investment at fair value through profit or loss 88,595 116,798
Total investments 88,595 116,798
(b) Movements during the Period
Opening balance of investment, at cost 134,065 134,065
Additions, at cost - -
Cost of investments at Period end 134,065 134,065
Revaluation of investments to fair value:
Unrealised movement in fair value of investment (45,470) (17,267)
Fair value of investment at Period end 88,595 116,798
(c) Losses on investments during the Period
Unrealised movement in fair value of investment brought forward (17,267) (6,690)
Unrealised movement in fair value of investments during the Period (28,203) (10,577)
Losses on investments (45,470) (17,267)
Fair value measurements
IFRS 13 requires disclosure of fair value measurement by level. The level of
fair value hierarchy within financial assets or financial liabilities is
determined on the basis of the lowest level input that is significant to the
fair value measurement. Financial assets and financial liabilities are
classified in their entirety into only one of the following three levels:
Level 1
The unadjusted quoted price in an active market for identical assets or
liabilities that the entity can access at the measurement date.
Level 2
Inputs other than quoted prices included within Level 1 that are observable
(i.e. developed using market data) for the asset or liability, either directly
or indirectly.
Level 3
Inputs are unobservable (i.e. for which market data is unavailable) for the
asset or liability.
As at 30 June 2024 As at 31 December 2023
Level 1 Level 2 Level 3 Total Level 1 Level 2 Level 3 Total
$'000 $'000 $'000 $'000 $'000 $'000 $'000 $'000
Investment at fair value through profit or loss:
Equity investment in Holdco - - 88,595 88,595 - - 116,798 116,798
Total investments - - 88,595 88,595 - - 116,798 116,798
Due to the nature of the underlying investments held by Holdco, the Company's
investment in Holdco is always expected to be classified as Level 3. There
have been no transfers between levels during the Period.
The movement on the Level 3 unquoted investment during the Period is shown
below:
As at As at
30 June 31 December
2024 2023
$'000 $'000
Opening balance 116,798 127,375
Unrealised loss on investment (28,203) (10,577)
Closing balance 88,595 116,798
4. Income
Six months Six months
ended 30 June ended 30 June
2024 2023
$'000 $'000
Income from investment
Dividends from Holdco 3,174 3,600
Deposit interest 34 48
Total income 3,208 3,648
5. Investment Management Fee
Six months ended 30 June 2024 Six months ended 30 June 2023
Revenue Capital Total Revenue Capital Total
$'000 $'000 $'000 $'000 $'000 $'000
Investment Management Fee 498 - 498 637 - 637
The Investment Management Agreement ("IMA") dated 11 November 2020 between the
Company and Ecofin Advisors, LLC, appointed the AIFM to act as the Company's
Investment Manager for the purposes of the AIFM Directive. Accordingly, the
AIFM is responsible for providing portfolio management and risk management
services to the Company.
Under the IMA, the Investment Manager receives a fee of 1.00% per annum of NAV
up to and including $500 million; 0.90% per annum of NAV in excess of $500
million up to and including $1 billion; and 0.80% per annum of NAV in excess
of $1 billion, invoiced quarterly in arrears. Until such time as 90% of the
Net Initial Proceeds of the Company's IPO was committed to investments, the
Investment Management fee was only charged on the committed capital of the
Company. No performance fee or asset level fees are payable to the AIFM under
the IMA.
The Investment Manager reinvests 15% of its annual management fee in Shares
(the "Management Fee Shares"), subject to a rolling lock-up of up to two
years, subject to certain limited exceptions. The Management Fee Shares are
issued on a quarterly basis. Where the Shares are trading at a premium to NAV,
the Company issues new Shares to the Investment Manager equivalent in value to
the management fee reinvested. Where the Shares are trading at a discount to
NAV, the Management Fee Shares are purchased by the Company's Brokers at the
prevailing market price.
The calculation of the number of Management Fee Shares to be issued is based
upon the NAV as at the relevant quarter concerned. The Investment Manager is
also entitled to be reimbursed for out-of-pocket expenses reasonably and
properly incurred in respect of the performance of its obligations under the
IMA.
Unless otherwise agreed by the Company and the Investment Manager, the IMA may
be terminated by the Company or the Investment Manager on not less than 12
months' notice to the other party, such notice not to expire earlier than 36
months from the Effective Date of the IMA (11 November 2020). The IMA may be
terminated by the Company with immediate effect from the time at which notice
of termination is given or, if later, the time at which such notice is
expressed to take effect in accordance with the conditions set out in the IMA.
Cash was paid in settlement of investment fees for the first quarter of the
year.
6. Earnings per Share
Earnings per Share is based on the loss for the six months ended 30 June 2024
of $25,939,000 (30 June 2023: $429,000) attributable to the weighted average
number of Shares in issue of 138,078,496 in the Period (30 June 2023:
138,078,496). Revenue profit and capital losses were $2,262,000 and
($28,201,000) respectively (30 June 2023: $2,504,000 and ($2,075,000)
respectively).
7. Share Capital
As at 30 June 2024 As at 31 December 2023
Number of Nominal value Number of Nominal value
Allotted, issued and fully paid: shares $ shares $
Opening and closing balance 138,078,496 1,380,784.96 138,078,496 1,380,784.96
The Shares have attached to them full voting, dividend and capital
distribution (including on winding-up) rights. They confer rights of
redemption. There were no shares issued or bought back during the Period
(prior year: none).
As at 30 June 2024, the Company's issued share capital comprised 138,078,496
Shares (30 June 2023: 138,078,496; 31 December 2023: 138,078,496) and this is
the total number of Shares with voting rights in the Company.
8. Special Distributable Reserve
Following admission of the Company's Shares to trading on the LSE in December
2020, the Directors applied to the Court and obtained a judgement on 29
January 2021 to cancel the amount standing to the credit of the share premium
account of the Company. The amount of the share premium account cancelled and
credited to the Company's Special distributable reserve was $121,250,000,
which can be utilised to fund distributions to the Company's Shareholders.
9. Net Assets per Share
Net assets per Share is based on $89,787,000 of net assets of the Company as
at 30 June 2024 (31 December 2023: $117,659,000) attributable to the
138,078,496 Shares in issue as at the same date (December 2023: 138,078,496).
10. Dividends
(a) Dividends paid during the Period
The Company paid the following interim dividends during the Period:
Six months ended 30 June 2024
Special
distributable Revenue
Cents per reserve reserve Total
Share $'000 $'000 $'000
Quarter ended 31 December 2023 0.70c - 967 967
Total 0.70c - 967 967
Six months ended 30 June 2023
Special
distributable Revenue
Cents per reserve reserve Total
Share $'000 $'000 $'000
Quarter ended 31 December 2022 1.40c - 1,933 1,933
Quarter ended 31 March 2023 1.40c - 1,933 1,933
Total 2.8c - 3,866 3,866
(b) Dividends paid and payable in respect of the financial Period
The dividends paid and payable in respect of the financial Period are the
basis on which the requirements of s1158-s1159 of the Corporation Tax Act 2010
are considered.
Six months ended 30 June 2024
Special
distributable Revenue
Cents per reserve reserve Total
Share $'000 $'000 $'000
Quarter ended 31 March 2024 0.70c - 966 966
Total 0.70c - 966 966
A dividend of 70 cents per share for the quarter ended 31 March 2024 was paid
on 19 July 2024.
Six months ended 30 June 2023
Special
distributable Revenue
Cents per reserve reserve Total
Share $'000 $'000 $'000
Quarter ended 31 March 2023 1.40c - 1,933 1,933
Quarter ended 30 June 2023 0.70c - 967 967
Total 2.1c - 2,900 2,900
11. Related Party Transactions with the Investment Manager and the Directors
Investment Manager
Fees payable to the Investment Manager are shown in the Statement of
Comprehensive Income. As at 30 June 2024, the fee owing to the Investment
Manager was $224,000 (31 December 2023: $297,000).
As at 30 June 2024, the Investment Manager's total holding of Shares in the
Company was 8,780,378 (31 December 2023: 8,780,378).
Directors
The Company is governed by a Board of Directors (the "Board"), all of whom are
non-executive, and it has no employees. Four of the Directors were appointed
on 22 October 2020. Brett Miller was appointed on 11 July 2024. Louisa Vincent
will step down from the Board on 31 October 2024.
Each of the Directors is entitled to receive a fee from the Company at such
rate as may be determined in accordance with the Articles. Each Director
receives a fee payable by the Company at the rate of £40,000 per annum.
The Chair of the Board receives an additional £10,000 per annum. The Chair of
the Audit Committee, the Chair of the Management Engagement Committee and the
Chair of the Risk Committee each receive an additional £6,000 per annum.
The Board agreed to pay Brett Miller additional consultancy fees of £12,500
per month for a three month period with effect from 12 August 2024 in
connection with the Company's strategic review and managed wind down.
The Directors had the following shareholdings in the Company, all of which
were beneficially owned.
Shares at
Shares at 31 December
Director 30 June 2024 2023
Patrick O'Donnell Bourke 104,436 104,436
David Fletcher 63,639 62,894
Brett Miller - -
Tammy Richards 25,000 25,000
Louisa Vincent 36,076 36,076
Following the period end, Mr Fletcher purchased a further 914 Ordinary shares
as part of a dividend re-investment scheme. Following this transaction, Mr
Fletcher's total shareholding in the Company was 64,553 ordinary shares.
12. Commitments and Contingencies
As at 30 June 2024 the Company had an open investment commitments to Echo
Solar in the amount of $9.3 million.
13. Post Balance Sheet Events
Board Appointment
Brett Miller was appointed to the Board on 11 July 2024. On 9 September 2024,
the Company announced that Louisa Vincent would step down from the Board with
effect from 31 October 2024.
Conclusion of Strategic Review and Managed Wind Down
On 9 September 2024, the Company announced its intention to implement a
managed wind down ("the Managed Wind Down") which would entail an incremental
sales programme of the Company's assets. The implementation of the Managed
Wind Down will require amendments to be made to the Company's Investment
Policy. A circular will be prepared and posted to shareholders in due course
seeking approval for the implementation of the Managed Wind Down and amendment
of the Company's existing investment policy.
Dividend
On 9 September 2024, the Company announced that it would not pay a dividend in
respect of Q2 2024.
Status of this report
These interim financial statements are not the Company's statutory accounts
for the purposes of section 434 of the Companies Act 2006. They are unaudited.
The unaudited Half-yearly report will be made available at the registered
office of the Company. The report will also be available in electronic format
on the Company's website, http://www.ecofininvest/rnew
(https://uk.ecofininvest.com/funds/ecofin-us-renewables-infrastructure-trust-plc/)
.
The financial information for the year ended 31 December 2023 has been
extracted from the statutory accounts which have been filed with the Registrar
of Companies. The auditor's report on those accounts was not qualified and did
not contain statements under sections 498 (2) or (3) of the Companies Act
2006.
This Half-yearly report was approved by the Board of Directors on 25 September
2024.
Alternative Performance Measures
For the six months ended 30 June 2024
In reporting financial information, the Company presents alternative
performance measures, ("APMs"), which are not defined or specified under the
requirements of IFRS. The Company believes that these APMs, which are not
considered to be a substitute for or superior to IFRS measures, provide
stakeholders with additional helpful information on the performance of the
Company. The APMs presented in this report are shown below:
Premium/Discount
The amount, expressed as a percentage, by which the share price is greater or
less than the NAV per Share.
As at
30 June 2024
NAV per Share (cents) a 65.0
Share price (cents) b 52.0
Discount (b÷a)-1 20.0%
Total return
Total return is a measure of performance that includes both income and capital
returns. It takes into account capital gains and the assumed reinvestment of
dividends paid out by the Company into its Shares on the ex-dividend date. The
total return is shown below, calculated on both a share price and NAV basis.
Share price NAV per share
For the six months ended 30 June 2024 (cents) (cents)
Opening at 1 January 2024 a 56.5 85.2
Closing at 30 June 2024 b 52.0 65.0
Dividends declared during the Period c 1.4 1.4
Dividend/income adjustment factor(1) d 0.9988 0.9983
Adjusted closing e = (b + c) x d e 53.3 66.3
Total return (e÷a)-1 -5.6% -22.2%
1 The dividend adjustment factor is calculated on the assumption
that the dividends paid out by the Company are reinvested into the shares of
the Company on the ex-dividend date.
Ongoing charges ratio
A measure, expressed as a percentage of average NAV, of the regular, recurring
annual costs of running an investment company.
As at As at
30 June
31 December 2023
2024
Average NAV ($'000) a 94,739 124,293
Annualised expenses ($'000) b 1,892 2,209
Ongoing charges ratio (b÷a) 2.00% 1.78%
Enquiries:
Company Secretary
Apex Listed Companies Services (UK) Ltd
Tel: +44 (0) 20 4582 6470
The Half-yearly financial report will be submitted to the National Storage
Mechanism and will shortly be available for inspection at:
https://data.fca.org.uk/#/nsm/nationalstoragemechanism
(https://data.fca.org.uk/#/nsm/nationalstoragemechanism)
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