REG - International PPL - Half-year Results for Six Months 30 June 2025

International Public PartnershipsAnnouncement

04/09/2025 07:00

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RNS Number : 9051X  International Public Partnerships  04 September 2025

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4 September 2025

 

INTERNATIONAL PUBLIC PARTNERSHIPS LIMITED

('INPP', 'the Company')

HALF YEAR RESULTS FOR THE SIX MONTHS TO 30 JUNE 2025

 

International Public Partnerships, the FTSE 250-listed infrastructure
investment company ('INPP' or the 'Company') is pleased to announce its
half-year results for the six months to 30 June 2025.

Mike Gerrard, Chair of International Public Partnerships, said: "Our portfolio
continued to perform exceptionally well during the period, delivering
resilient cash flows and demonstrating the strength of our high-quality,
diversified asset base. We are encouraged by early signs of improving market
sentiment and remain confident that our capital allocation is providing real
value for shareholders. This includes over £345 million of realisations to
date which have validated the NAV, and up to £200 million to be returned
through our buyback programme by March 2026. With a strong pipeline of
opportunities ahead, the Company is well positioned to recycle capital into
higher-returning investments and deliver sustainable long-term capital
growth."

period highlights

·    Net Asset Value ('NAV') per share increased by 2.8% from 144.7p to
148.7p in the six months ended June 2025, primarily driven by strong portfolio
performance, the successful execution of asset realisations at a meaningful
premium to NAV, and c.1.1p per share of NAV accretion to date from the ongoing
share buyback programme.

·    Reconfirmed the c.2.5% i  dividend growth target for 2025 and 2026,
extending the Company's track record of growing dividends each year since the
IPO in 2006.

·    Increased the frequency of dividend payments to quarterly
distributions, in order to provide investors with a more regular income
stream. The first interim dividend for the financial year 2025 of 2.14p was
announced in July 2025 and is payable on 15 September 2025.

·    c.£90 million of realisations announced since the start of the year,
taking the realisation proceeds to over £345 million since June 2023,
equivalent to c.13% of the portfolio. All realisations were in line with, or
above, the most recently published valuations.

·    Reiterated the intention to return up to £200 million of capital by
31 March 2026. As of 30 June 2025, c.£80 million of shares had been acquired
since the commencement of the programme in January 2024. The return of capital
will continue to be funded through divestments and surplus operating cash
flows.

·    Committed to invest c.£250m over the next five years in the
regulated company financing the construction of Sizewell C, with an expected
return profile above the level implied from a share buyback.

·    Selected as preferred bidder on the Moray West OFTO, for which
c.£65m may be expected to be invested in early 2026 ii .

·    Retained strong inflation-linkage of 0.7% iii , generating long-term
real rates of shareholder returns.

·    Achieved excellent operational performance with asset availability of
98.7% during the period, exceeding the 98% target iv .

·    As announced on 27 March 2025, the Investment Adviser fee structure
was revised from 1 July 2025. The base fee payable in respect of each quarter
is now based on the equal weighting of: the average of the closing daily
market capitalisation of the Company during that quarter; and the most
recently published NAV. This fee change enhances alignment of interests with
shareholders as it is expected to reduce the ongoing management fee by c.10%
per year based on the share price at the time of the initial announcement (27
March 2025).

VALUATION

·    The Company's NAV increased by 1% to £2.74 billion (31 December
2024: £2.72 billion) and NAV per share increased by 2.8% to 148.7 pence (31
December 2024: 144.7 pence).

·    The increase in NAV per share was primarily driven by strong
portfolio performance, the successful execution of some asset realisations at
a meaningful premium to NAV, as well as share buy buybacks. The total NAV per
share return for the period was 5.7%.

·    The weighted average discount rate remained stable at 9.0%, implying
no negative impact on investment valuations and profits for the period.

·    IFRS profit before tax of £142.6 million (H1 2024: £16.7 million).
The year-on-year increase principally reflects the unrealised fair value
movements of the investment portfolio in each period.

·    Portfolio valuations in the six months to 30 June 2025 benefitted
from continued strong asset performance as well as positive impacts from
divestments in the period. In the prior period, rises in government bond
yields and market return expectations contributed to an increase in the
discount rates used in the valuation process.

·    The Company's shares maintained a low correlation to the FTSE All
Share Index of 0.4 over the 12 months to 30 June 2025 (31 December 2024: 0.4).

·    The dividend yield of the Company based on the 30 June 2025 share
price was an attractive 7.2%. The Board forecasts the continuation of the
Company's track record of growing dividends each year since the IPO in 2006
with target dividends of 8.58 pence per share and 8.79 pence per share for
2025 and 2026 respectively. These dividends are expected to be fully covered
by net operating cash flows and the annual increases are in line with the
Company's long-term projected annual dividend growth rate of c.2.5%.

·    Cash dividends during the period were fully covered: 1.1 times (30
June 2024: 1.1 times) by the Company's net operating cash flows before capital
activity.

Realisations and buyback commitment

·    Following the shift in government bond yields, the listed
infrastructure investment trust sector, including INPP, has moved from trading
at a premium to trading at a discount to NAV. Against this backdrop, the Board
and the Investment Adviser remain committed to taking action to support the
continued narrowing of the discount to NAV and to enhance the total return for
our shareholders. In 2025, the Company announced a further c.£90 million of
realisations taking the realisation proceeds to over £345 million since June
2023. All realisations have been in line with, or at a premium to, the
relevant published valuations.

·    Realisations announced so far have validated the NAV across the types
of assets in which the portfolio is invested, including :

o  Minority interests in British Schools for the Future ('BSF'): In March
2025, the Company agreed to sell its minority equity interests in seven of the
UK education assets from the BSF portfolio for total proceeds of c.£8
million, in line with the most recent valuations. This transaction has reached
contractual completion, and financial completion is expected in Q3 2025.

o  UK Education PPP: In July 2025, the Company completed its debt financing
to release c.£49 million of capital from its Priority Schools Building
Aggregator Programme ('Priority Schools Programme') investments and 13 BSF
portfolio interests, consisting mostly of minority stakes. The value of the
retained equity interests and funds released from the transaction was at a
premium to the 31 December 2024 valuation.

o  A partial disposal of Angel Trains: In August 2025, the Company completed
a sale on part of its investment in Angel Trains. The transaction will realise
c.£32 million, with the sale price being at an attractive premium to the
Company's valuation as at 31 December 2024.

·    The Board and the Investment Adviser continue to actively pursue
selective divestment opportunities across INPP's portfolio to support
valuations and fund the continued return of capital to investors. The proceeds
from these realisations will be recycled: (i) into the share buyback programme
of up to £200m, which we intend to run to 31 March 2026; as well as (ii)
towards future commitments and acquisitions.

INVESTMENT ACTIVITY AND ASSET STEWARDSHIP

Investment activity

·    The Company does not need to make additional investments to deliver
current projected returns and reconfirms that the projected cash receipts from
the existing portfolio are such that even if no further investments are made,
the Company currently expects to be able to continue to meet its existing
progressive dividend policy for at least the next 20 years v .

·    Capital invested during the six months to 30 June 2025 included
funding of £6.1m into three long-standing investment commitments to Flinders
University Health and Medical Research Building ('HMRB'), Gold Coast Light
Rail - Stage 3 and toob. The investment into HMRB completed during the period,
and the investment into Gold Coast Light Rail - Stage 3 completed by the date
of this announcement. The remaining investment commitment to toob (c.£2.1m)
is expected to be fulfilled by mid-2026. In addition, during the period £0.6
million was invested into the final 10% stake in the two Southwark BSF schemes
(Education), bringing INPP's ownership in both schemes to 100%.

Investment commitments

·    The Company has recently been selected as preferred bidder on two
significant opportunities: Sizewell C and Moray West OFTO. Both transactions
are expected to enhance key portfolio metrics, including the weighted average
discount rate, inflation linkage, dividend cover, and add further positive ESG
characteristics.

·    In July 2025, INPP announced a commitment of c.£250m to Sizewell C,
to be invested over the next five years alongside the UK Government and other
strategic partners. The project will be delivered through the Regulated Asset
Base model, providing stable, long-term cash flows, extending the overall
portfolio life, and supporting the UK's transition to low-carbon energy.

·    Moray West, which will become INPP's twelfth OFTO investment, offers
operational exposure and cash yield from the outset. This further strengthens
the Company's established position in offshore transmission, while continuing
to build long-duration, inflation-linked returns.

Further information on the Company's investment activity can be found on pages
16 to 18 of the 2025 Interim Report.

NOTABLE PORTFOLIO UPDATES

Tideway (Waste water, top 10 investment, 15.6% of fair value as at 30 June
2025)

·    During the period, Tideway the new 25km 'super sewer' under the River
Thames, started to prevent sewage from entering the river, by end July 2025,
it had already prevented 7.8 million tonnes of sewage entering the River
Thames. In February 2025, the tunnel was fully connected, bringing the entire
system online to protect from pollution, promising a greener, healthier river.
Commissioning, which includes the storm testing phase of the project, is
currently underway and is scheduled for completion in the second half of 2025.

·    Tideway continues to monitor developments in relation to the
well-publicised financial position of Thames Water. The matter is not expected
to have a material impact on the Company's investment in Tideway. Whilst
Thames Water has a licence obligation to pass revenues to Tideway, statutory
and regulatory protections are afforded to Tideway which are designed to
mitigate the risk of disruption to the receipt of revenues and would continue
to apply should Thames Water's status change.

Beatrice OFTO (Energy transmission)

·    We have previously reported that the Beatrice OFTO was operating at
reduced capacity due to a cable fault that occurred in April 2025. The repair
works to the offshore cable are now complete and the asset returned to full
capacity in July 2025. The Investment Adviser currently anticipates that the
revenue protection will be maintained and the costs of the repair are expected
to be covered by insurances and any financial impact is not expected to be
material to the portfolio.

·    Asset availability for OFTOs for the period was 97.7%. If revenue
protection is granted by the regulator in accordance with the regulation, as
the Investment Adviser anticipates, then paid availability for the period will
be 99.8%.

Cadent (Gas distribution, top 10 investment, 15.4% of fair value as at 30 June
2025)

·    In July 2025, Ofgem published its RIIO-3 Draft Determination for
Cadent, outlining its initial assessment of the revenues Cadent may earn
during the next price control period (April 2026 to March 2031). The majority
of the elements aligned with the Company's expectations. Cadent, supported by
our Investment Adviser, co-investors, and market participants, is working to
secure a favourable final determination for both customers and investors
expected in December 2025.

 

For updates and information on the wider portfolio, please refer to the Asset
Management section of the 2025 Interim Report.

RESPONSIBLE INVESTMENT

·    During the period, we released our latest Sustainability Report vi ,
which detailed the areas of progress that the Company has made in driving
sustainability performance across its investments. This included the progress
made against its two net zero Key Performance Indicators ('KPIs'), successful
decarbonisation initiatives within its portfolio of educational assets and
voluntarily making available certain disclosures under the Sustainable
Disclosure Regulation ('SDR').

CORPORATE GOVERNANCE

·    As previously advised, John Le Poidevin and Giles Frost both retired
from the Board at the 2025 AGM, after many years of dedicated service to the
Company.

·    Following the retirement of John, and as previously announced, Meriel
Lenfestey has been appointed Senior Independent Director.

·    Mike Gerrard, Chair of INPP also announces his intention to retire
from his position as Chair and from the Board at the 2026 AGM. Mike joined the
Board in 2018, becoming Chair in 2019. Work to ensure a suitable replacement,
and a smooth and orderly transition to a new Chair is already underway, and a
further update will be provided in due course

·    From 1 September 2025, Jamie Hossain has succeeded Chris Morgan in
leading the Company's shareholder engagement alongside other senior members of
the Investment Adviser's team. Chris recently left Amber to pursue a new
opportunity after 13 years of service.

OUTLOOK

The Board and the Investment Adviser reaffirm their confidence in the
Company's long-term strategy and encouragingly, we are now seeing early signs
of a positive shift in sentiment. Investors are increasingly recognising the
long-term benefits of the defensive characteristics of the infrastructure
asset class in a complex market environment, highlighting the compelling
opportunity for those seeking resilient, stable returns. The Board remains
focused on returning capital to shareholders, whilst also focusing on
broadening and diversifying the Company's access to capital to support
sustainable long-term growth. The diversified portfolio continues to deliver
stable, predictable, and attractive cash flows, with strong inflation linkage
that is central to INPP's investment case. Recent portfolio activity further
demonstrates the strength of the Company's focus on shareholder returns, while
delivering long-term societal and environmental benefits through sustainable
infrastructure investments.

Historical underinvestment in essential public infrastructure continues to
create the conditions for new and attractive investment opportunities.
Governments continue to prioritise infrastructure investment as a foundation
for economic growth and environmental progress, with the recently published
10-Year Infrastructure Strategy and the 2025 Spending Review in the UK
reaffirming this policy commitment and the vital role envisaged for private
capital. We see this trend replicated in the international markets in which we
operate, with similar opportunities and support from governments in wider
European markets as well as Australia and New Zealand. With nearly two decades
of experience working in partnership with public authorities, INPP is well
positioned to selectively capture these opportunities.

The continued discount to NAV presents a compelling investment opportunity
with an implied projected net return of 10.2% vii  on an investment in the
Company's shares, a current dividend yield of 7.1% viii  and an attractive
4.6% ix  premium to that offered by a 30-year UK government bond.

Looking ahead, INPP's geographic diversification and differentiated expertise
in building, operating, managing, and owning a broad portfolio of
infrastructure assets and businesses positions us strongly for the future. The
measures announced alongside today's results further reinforce our ability to
deliver on our long-term objectives and continued creation of value for
shareholders.

OTHER INFORMATION

The 2025 Interim Report and financial statements have today been published on
the Company's website, along with a copy of the results presentation, and can
be accessed and downloaded at
https://www.internationalpublicpartnerships.com/investors/reports-and-publications/
(https://www.internationalpublicpartnerships.com/investors/reports-and-publications/)

In compliance with Listing Rule 9.6.1, a copy of the 2025 Interim Report has
been 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) .

In accordance with Disclosure Guidance and Transparency Rules (DTR) 6.3.5(1A),
the regulated information required under DTR 6.3.5 is available in unedited
full text within the 2023 Annual Report as uploaded and available on the
National Storage Mechanism and on the Company's website as noted above.

 

ENDS

 NOTES TO EDITORS

 

 For further information:

Erica
Sibree
                                +44 (0) 7557
676 499 / (0) 7827 238 355

Amber Fund Management
Limited

Hugh Jonathan
                        +44 (0)20 7260 1263

Deutsche Numis

Mitch Barltrop/ Maxime Lopes
  +44 (0) 7703 330 199 / (0) 7890 896 777

FTI Consulting

About International Public Partnerships ('INPP'):

INPP is a listed infrastructure investment company that invests in global
public infrastructure projects and businesses, which meets societal and
environmental needs, both now, and into the future.

INPP is a responsible, long-term investor in over 140 infrastructure projects
and businesses. The portfolio consists of utility and transmission, transport,
education, health, justice and digital infrastructure projects and businesses,
in the UK, Europe, Australia, New Zealand and North America. INPP seeks to
provide its shareholders with both a long-term yield and capital growth.

Amber Infrastructure Group ("Amber") is the Investment Adviser to INPP and in
this capacity is responsible for investment origination, asset management and
fund management of the Company.

Amber is part of Boyd Watterson Global Asset Management Group LLC, a global
diversified infrastructure, real estate and fixed income business with over
$36 billion in assets under management and over 300 employees with offices in
eight US cities and presence in twelve countries (as at 31 December
2024).Visit the INPP website at www.internationalpublicpartnerships.com
(http://www.internationalpublicpartnerships.com/)  for more information.

 Important Information

This announcement contains information that is inside information for the
purposes of the UK version of the Market Abuse Regulation (EU) No. 596/2014
which is part of UK law by virtue of the European Union (Withdrawal) Act 2018
(as amended and supplemented from time to time).

This announcement does not constitute a prospectus relating to the Company and
does not constitute, or form part of, any offer or invitation to sell or
issue, or any solicitation of any offer to purchase or subscribe for, any
shares in the Company in any jurisdiction nor shall it, or any part of it, or
the fact of its distribution, form the basis of, or be relied on in connection
with or act as any inducement to enter into, any contract therefor. The
issuance programme, as described in Part VI of the Prospectus issued by the
Company on 8 April 2022, available on the website, is closed.

Forward-looking statements are subject to risks and uncertainties and
accordingly the Company's actual future financial results and operational
performance may differ materially from the results and performance expressed
in, or implied by, the statements. These forward-looking statements speak only
as at the date of this announcement. The Company, Amber and Numis Securities
Limited expressly disclaim any obligation or undertaking to update or revise
any forward-looking statements contained herein to reflect actual results or
any change in the assumptions, conditions or circumstances on which any such
statements are based unless required to do so by the Financial Services and
Markets Act 2000, the Prospectus Regulation Rules of the Financial Conduct
Authority or other applicable laws, regulations or rules.

 

 i  As previously announced, in response to elevated inflation levels, the
Company increased its dividend by 5% in 2023 and by 3% in 2024. From 2025
onwards, the Board expects to maintain its long-term projected annual dividend
growth rate of approximately 2.5%. Future profit projection and dividends
cannot be guaranteed. Projections are based on current estimates and may vary
in future.

 ii  This represents the current commitment or preferred bidder positions that
meet the Company's investment criteria. There is no certainty that potential
opportunities will translate into actual investments for the Company and will
only be considered where in alignment with the Company's existing capital
allocation policy.

 iii  Calculated by running a 'plus 1.0%' inflation sensitivity for each
investment and solving each investment's discount rate to return the original
valuation. The inflation-linked return is the increase in the weighted average
discount rate.

 iv  The asset availability target applies to assets generating
availability-based revenues (i.e. both PPPs and OFTOs). See the Asset
Management section of the 2025 Interim Report for further information on the
asset availability during the period.

 v  This is reflective of the 2025 and 2026 dividend targets, and c.2.5%
annual dividend growth thereafter. As recently reported, the investment into
Sizewell C is intended to increase this timeframe from 20 years to 25 years.
Please see further information here:
https://www.internationalpublicpartnerships.com/media/zkvd0hln/20250722_inpp_troy-presentation_vf.pdf

 vi 
https://www.internationalpublicpartnerships.com/media/hvqjo5bn/inpp-sustainability-report-march-2025-vf.pdf

 vii  As at 29 August 2025. This is calculated based on INPP's weighted
average discount rate, less the Ongoing Charges Ratio, adjusted to reflect the
share price discount to the NAV using published sensitivities.

 viii  Dividends projected to be paid over the 12 months from 29 August 2025
divided by the Company's share price as at 29 August 2025.

 ix  As at 29 August 2025. 30-year bond used owing to the UK weighting of the
portfolio and the weighted average investment tenor of c.38 years.

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