REG - Octopus Renewables - Q1 2025 Factsheet and Net Asset Value

Octopus Renewables Infrastructure TrustAnnouncement

07/05/2025 07:00

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RNS Number : 5664H  Octopus Renewables Infra Trust PLC  07 May 2025

7 May 2025

 

LEI: 213800B81BFJKWM2JV13

 

Octopus Renewables Infrastructure Trust plc

("ORIT" or the "Company")

 

Q1 2025 Factsheet and Net Asset Value

 

Octopus Renewables Infrastructure Trust PLC, the diversified renewables
infrastructure company, announces that its unaudited Net Asset Value ("NAV")
as at 31 March 2025, on a cum-income basis, was £560.5 million or 101.62
pence per Ordinary Share (31 December 2024: £570.4 million or 102.65
pence per Ordinary Share).

 

                                                                                Pence per Ordinary Share*  £m
 Unaudited NAV as at 31 December 2024                                           102.65                     570.4
 Power Prices and Green Certificates                                            (0.03)                     (0.1)
 Inflation and Foreign Exchange ("FX")                                          1.20                       6.7
 Discount Rate Changes                                                          (1.34)                     (7.5)
 Share Buybacks                                                                 0.27                       (2.6)
 Other movements
 Expected return on the portfolio of assets                                     2.19                       12.2
 Restructure of Norgen investment                                               0.27                       1.5
 Q4 2024 interim dividend                                                       (1.51)                     (8.4)
 Plc and Holdco Operating Costs including financing costs                       (1.22)                     (6.8)
 Other asset specific adjustments                                               (0.86)                     (4.8)
 Unaudited NAV as at 31 March 2025                                              101.62                     560.5

 

* Totals may not sum exactly due to rounding

 

Power Prices and Green Certificates

 

During the first quarter of 2025, power prices and Green Certificate movements
had a limited impact on the Company's NAV. ORIT's portfolio continues to
benefit from significant protection against short-term power price volatility,
with a substantial proportion of revenue secured under fixed or contracted
arrangements. As at 31 March 2025, 84% of ORIT's forecast revenue over the
subsequent 24 months was fixed or contracted (unchanged from 31 December
2024). The portfolio is further supported by a high proportion of fixed Green
Certificate revenues, limiting the impact of market fluctuations.

 

Inflation and FX

 

Inflation forecasts across ORIT's jurisdictions remained broadly stable over
the quarter. However, a valuation increase of £3.7 million was recognised,
primarily due to an upward revision to the Company's near-term UK RPI
assumptions for 2026 to 2028, which increased from approximately 3.0% to
3.25%. The long-term Retail Price Index ("RPI") assumption remains at 2.25%,
in line with the Bank of England's CPIH target (Consumer Prices Index
including owner occupiers' housing costs). The broader inflationary
environment, reflected in the Company's revised near-term RPI assumptions, has
also contributed to persistently high interest rates. These interest rate
conditions, in turn, have influenced discount rate benchmarks across the
sector and are reflected in the updated valuation assumptions outlined below.

 

Sterling weakened against the Euro during Q1 2025, resulting in a gross
valuation increase (before currency hedges) of £5.2 million. Accounting for
currency hedges at the Company level, the gain was £3.0 million.

 

The combined effects of inflation and foreign exchange movements resulted in a
net valuation increase of £6.7 million or 1.20 pence per Ordinary Share.

 

Discount Rate Changes

 

During Q1 2025, the weighted average discount rate ("WADR") applied to the
portfolio increased from 7.0% to 7.6%, reflecting changes in market
assumptions and the impact of new project-level financing.

 

Sustained high interest rates and bond yields - themselves a response to
persistent inflationary pressures - continue to shape discount rate benchmarks
across the sector. The increase in underlying discount rates reflects
alignment with prevailing market conditions, supported by transaction evidence
observed by the Investment Manager, and resulted in a £7.5 million reduction
in portfolio valuation over the period.

 

In addition, new project financing completed during the period introduced
additional debt at the portfolio level, increasing the blended cost of capital
and contributing further to the WADR uplift.  The reported WADR excludes
contributions from (i) the return expected on the Company's investment into
development stage assets, and (ii) the increased return associated with the
additional leverage from the Revolving Credit Facility ("RCF").

 

Share Buybacks

( )

During 2024, the Company launched a share buyback programme with an initial
tranche of up to £10 million, which was subsequently increased to £30
million. In Q1 2025, ORIT repurchased 4,088,206 shares for approximately £2.6
million at an average price of 64.8 pence per Ordinary Share. Following these
buybacks, the total number of voting rights in the Company as at 31 March 2025
was 551,570,568.

 

This reduced number of shares has been used in the calculation of NAV per
Ordinary Share at quarter end, resulting in a positive NAV per share impact.
The repurchase of shares at a discount to NAV contributed to a net increase in
NAV per Ordinary Share of 0.3 pence during Q1 2025, and a cumulative increase
of 0.7 pence since the start of the programme in 2024.

 

Other movements

 

Other valuation movements included a £12.2 million uplift, reflecting the
expected return on the portfolio, driven by the unwinding of the discount rate
as future cash flows move closer to present value between 31 December 2024 and
31 March 2025. Additionally, the restructuring of the Norgen investment,
announced in February 2025, added £1.5 million to NAV.

 

These gains were partially offset by the Q4 2024 interim dividend payment of
£8.4 million (1.51 pence per Ordinary Share) and costs totalling £6.8
million, comprising operating expenses, transaction costs, and RCF interest.

 

Other downward adjustments include a £2.4 million net reduction related to
revised Capex and maintenance forecasts (most notably an increased provision
for generator replacements at the Lincs wind farm) and a £2.8 million impact
from operational performance at the asset level and other minor adjustments to
forecasts.

 

Gearing

 

As at 31 March 2025, ORIT had total gearing (total debt drawn as a % of Gross
Asset Value ("GAV"(1))) of 45.6% (44.6% as at 31 December 2024).

 

Notes

 

1              "Gross Asset Value" means the aggregate of (i) the
fair value of the Company's underlying investments (whether or not
subsidiaries), valued on an unlevered basis, (ii) the relevant assets and
liabilities of the Company (including cash) valued at fair value (other than
third party borrowings) to the extent not included in (i) or (ii) above.

 

Factsheet

 

The Company's Q1 2025 factsheet has been published today and is available to
download at:

https://www.octopusrenewablesinfrastructure.com/all-reports-publications
(https://www.octopusrenewablesinfrastructure.com/all-reports-publications)

 

For further information please contact:

 

 Octopus Energy Generation (Investment Manager)                   Via Burson Buchanan or

 Chris Gaydon, David Bird                                         orit@octopusenergygeneration.com (mailto:orit@octopusenergygeneration.com)

 Peel Hunt (Broker)                                               020 7418 8900

 Liz Yong, Luke Simpson, Huw Jeremy (Investment Banking)

 Alex Howe, Chris Bunstead, Ed Welsby, Richard Harris (Sales)

 Burson Buchanan (Financial PR)                                    020 7466 5000

 Charles Ryland, Nick Croysdill, Verity Parker

 Apex Listed Companies Services (UK) Limited (Company Secretary)  020 3327 9720

 

Notes to editors

 

About Octopus Renewables Infrastructure Trust

 

Octopus Renewables Infrastructure Trust ("ORIT") is a premium-listed,
closed-ended investment company incorporated in England and Wales focused
on providing investors with an attractive and sustainable level of income
returns, with an element of capital growth, by investing in a diversified
portfolio of renewable energy assets in Europe and Australia. As an impact
fund, ORIT is helping accelerate the transition to net zero by investing in
green energy, whilst also contributing to a broader set of UN Sustainable
Development Goals through its impact initiatives. ORIT's investment manager is
Octopus Energy Generation.

 

Further details can be found at www.octopusrenewablesinfrastructure.com
(http://www.octopusrenewablesinfrastructure.com/)

 

About Octopus Energy Generation

 

Octopus Energy Generation is driving the renewable energy agenda by building
green power for the future. Its specialist renewable energy fund management
team invests in renewable energy assets and broader projects helping the
energy transition, across operational, construction and development stages.
The team was set up in 2010 based on the belief that investors can play a
vital role in accelerating the shift to a future powered by renewable energy.
It has a 14-year track record with approximately £6.8 billion of assets under
management (AUM) (as of 31 December 2024) across 18 countries and total 4.5
GW. These renewable projects generate enough green energy to power 2.6 million
homes every year, the equivalent of taking over 1.4 million petrol cars off
the road. Octopus Energy Generation is the trading name of Octopus Renewables
Limited. Further details can be found at www.octopusenergygeneration.com
(http://www.octopusenergygeneration.com/) .

 

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