REG - Riverstone Credit - Interim Report and Unaudited Financial Statements
14/08/2025 11:15
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RNS Number : 3625V Riverstone Credit Opps. Inc PLC 14 August 2025
Riverstone Credit Opportunities Income Plc
Interim Report and Unaudited Interim Condensed Financial Statements
For the six months ended 30 June 2025
At a General Meeting held on 22 May 2024, Riverstone Credit Opportunities
Income Plc ("RCOI" or the "Company") adopted a revised Investment Objective in
order to facilitate a managed wind-down of the Company.
The Company plans to realise the Company's assets on a timely basis with the
goal of making returns of cash to holders of Ordinary Shares as soon as
practicable.
Company number: 11874946
All capitalised terms are defined in the list of defined terms below unless
separately defined.
Riverstone Credit Opportunities Income PLC
Riverstone Credit Opportunities Income Plc is an externally managed
closed-ended investment company listed on the London Stock Exchange.
The Company's Ordinary Shares were admitted to the Specialist Fund Segment of
the London Stock Exchange plc's Main Market and incorporated and registered on
11 March 2019 in England and Wales with an unlimited life.
At the Annual General Meeting ("AGM") held on 22 May 2024, Riverstone Credit
Opportunities Income Plc adopted the Wind-Down Investment Policy and entered
into a managed wind-down.
The Company's investment objective and investment policy is now to realise the
Company's assets on a timely basis with the objective of making returns of
cash to holders of Ordinary Shares as soon as practicable.
INVESTMENT MANAGER
The Company's Investment Manager is Riverstone Investment Group LLC, which is
controlled by affiliates of Riverstone Holdings LLC ("Riverstone").
On 31 December 2023, Riverstone entered into a sub-management agreement with
Breakwall Capital LP ("Breakwall" or "Sub-Manager") for all the credit
vehicles managed by Riverstone.
Riverstone was founded in 2000 and is currently one of the world's largest and
most experienced investment firms focused on energy, power, infrastructure and
decarbonisation. The firm has raised over $45 billion of capital and committed
approximately $45 billion to over 200+ investments in North America, South
America, Europe, Africa, Asia and Australia. Headquartered in New York,
Riverstone has built a global platform with additional offices located in
Amsterdam and Mexico City.
The registered office of the Company is 5th Floor, 20 Fenchurch Street,
London, England, EC3M 3BY.
Key Financials
2025 2024
NAV as at 30 June 2025/ 31 December 2024 $44.29m $62.55m
NAV per Share as at 30 June 2025/ 31 December 2024 $0.90 $0.92
Market capitalisation as at 30 June 2025/ 31 December 2024 $37.17m $51.80m
Share price at 30 June 2025/ 31 December 2024 $0.76 $0.76
Total comprehensive income for period ended 30 June 2025/ 30 June 2024 ($0.9)m $0.2m
EPS for the period ended 30 June 2025/ 30 June 2024 (1.35) cents 0.24 cents
Distribution per share with respect to the period ended 30 June 2025/ 30 June 1.58 cents 2.70 cents
2024
Highlights
· In June 2025, by way of Compulsory Redemption, the Company
redeemed 19,090,875 ordinary shares equal to $0.88 per share, representing
approximately 28 per cent. of the Ordinary shares.
· The NAV at 30 June 2025 was $0.90 per share (31 December 2024:
$0.92).
· Distributions of 1.58 cents per share (30 June 2024: 2.70 cents
per share) approved with respect to the period ended 30 June 2025.
· On 12 May 2025, the Company received $3.5 million cash payment
from Harland & Wolff from the administrators.
INVESTMENT OBJECTIVE AND POLICY
Following the outcome of the vote held at the AGM on 22 May 2024, the Company
adopted a revised investment objective and investment policy in order to
facilitate a managed wind-down of the Company. The revised Investment Policy
is now "to realise the Company's assets on a timely basis with the goal of
making returns of cash to holders of Ordinary Shares as soon as practicable"
(the "Wind-down Investment Policy").
The Investment Manager is actively seeking exit opportunities to realise the
loans comprising the Company's portfolio and returning the resulting proceeds
to Shareholders. The Investment Manager may dispose of loans in the secondary
market.
The precise mechanism for the return of cash to holders of Ordinary Shares in
the managed wind-down is at the discretion of the Board, but includes a
combination of capital distributions, tender offers, mandatory share
redemptions and share repurchases. The return of proceeds to Shareholders may
require further Shareholder approvals, depending on the methods used. Since
entering managed wind-down, the Company has returned approximately $39.8
million of capital to Shareholders, reflecting the redemption of 41,739,076
Ordinary shares.
The Company will continue to carry on its investment business during the
managed wind-down with a view to spreading risk during the managed wind-down.
Prior to the 2024 AGM, the Company's investment objective was to lend to
companies working to drive change and deliver solutions across the energy
sector, spanning renewable as well as conventional sources, with a primary
focus on infrastructure assets, by building a portfolio that generated an
attractive and risk adjusted return for investors. In addition, investments
are generally structured as Green Loans or Sustainability-Linked Loans
Further details on the Company's previous investment strategy, investment
restrictions and distribution policy are outlined in the Company's Annual
Report for the year ended 31 December 2024.
Chairman's Statement
Overview
On behalf of the Board, I would like to thank our shareholders for their
ongoing support. On 22 May 2024, following shareholder approval at the
Company's Annual General Meeting ("AGM"), the Company adopted the Wind-Down
Investment Policy and entered managed wind-down. We are very proud of the
portfolio of loans built by the Investment Manager to help support the energy
transition and we are committed to maximising shareholder value through this
managed wind-down process.
During the period, we are pleased that the Company completed a major milestone
towards this objective. At close of business on 27 June 2025 (the "Redemption
Date"), the Company redeemed (on a pro rata basis) 19,090,875 Ordinary Shares
at a redemption price of US$0.88 per Ordinary Share. The Ordinary Shares
redeemed were equal to approximately 28 per cent. of the Company's Ordinary
Shares in issue as at the Redemption Date. Following this initial redemption,
the Company has 49,066,161 Ordinary Shares remaining in issue. Since the
adoption of the Managed Wind Down Investment Policy, the Company has now
redeemed approximately 41 percent of the Company's Ordinary Shares.
Operationally, we continue to be pleased with the financial performance of the
Company's portfolio as well as the beneficial impact its loans are having on
the journey towards greater environmental sustainability in global energy
infrastructure. During the first half of 2025, the Company's portfolio
remained stable from 2024 with the exception of Harland & Wolff as the
remaining position is in administration. The Company has now delivered a NAV
total return of 31.5% to investors since inception in May 2019 and 38.9 cents
of income.
After the period end, the Investment Manager has also successfully realised
its investment in Streamline Innovations at a 20 percent gross IRR (15 percent
net IRR) and 1.33x gross MOIC (1.25x net MOIC)
The Company will continue to focus on the realisation of the Company's
remaining seven positions and the prompt return of capital to our
shareholders.
Key Portfolio Developments
As at 30 June 2025, RCOI's NAV per share is $0.90 (31 December 2024: $0.92).
The NAV per share decline over the period was principally attributable to a
decline in the fair market value of Harland & Wolff.
There was one successful realisation during 2025, Streamline.
· Post period-end, on 18 July 2025, the Company successfully
realised its first lien green term loan with Streamline Innovations at a 20
percent gross IRR, a 15 percent net IRR, 1.33x gross MOIC and a 1.25x net
MOIC.
Performance
The Company reported a loss of ($0.9) million for the period ending 30 June
2025, resulting from income received from the investment portfolio and changes
in the portfolio valuation. The Company's Net Asset Value ("NAV") ended the
period at $0.90 per share. The Company's reported loss over the period was
principally attributable to the mark reduction for Harland & Wolff. The
Company is paying distributions of 1.58 cents per share to investors in the
first half of 2025.
The current unrealised portfolio remains attractive, marked at an average
1.14x Gross MOIC and 1.01x Net MOIC. Characteristics of RCOI's investment
strategy, particularly the focus on a conservative LTV, diversified
sub-sectors and end-user base, as well as structured incentives for early
repayment, have helped mitigate negative portfolio impacts from broader market
fluctuations.
RCOI has made 27 investments, 20 of which are realised since inception and
cumulatively invested $253 million of capital since the IPO in May 2019. The
Company has now realised a total of 20 investments, delivering an average
gross IRR of 13.5 per cent and net IRR of 7.3 per cent.
Outlook
In total, since the adoption of the new Wind Down strategy in May 2024, the
Company has redeemed approximately 41 percent of the Company's shares in
issue. We remain focused on continuing to maximise value for shareholders and
promptly return that capital as we continue to progress this strategy. The
Board look forward to providing further updates on the remaining investments
in due course.
Reuben Jeffery, III
Chairman
14 August 2025
INVESTMENT MANAGER'S REPORT
ABOUT THE INVESTMENT MANAGER
Appointed in May 2019, the Investment Manager, an affiliate of Riverstone,
seeks to generate consistent shareholder returns predominantly in the form of
income distributions principally by making Green and Sustainability-Linked,
senior secured loans to energy transition businesses. Loans are classified as
Green Loans when they support environmentally sustainable economic activity
and Sustainability-Linked Loans when they contain sustainability performance
targets or other equivalent metrics to be monitored. RCOI has participated in
loans to companies working to drive change and deliver better solutions across
the energy sector, spanning renewable as well as conventional energy, with a
primary focus on infrastructure assets. The Company's aim was to build a
portfolio that generates an attractive and consistent risk-adjusted return for
investors, as well as drive positive impact regarding climate change by
structuring loans as Green Loans or Sustainability-Linked Loans.
On 31 December 2023, Riverstone Holdings LLC and their affiliate Riverstone
Investment Group (collectively, "Riverstone") entered into an agreement with
Breakwall Capital LP ("Breakwall") to provide sub-management services (the
"Sub-Management Agreement") for all credit vehicles managed by Riverstone,
including RCOI (the "Existing Credit Vehicles"). Breakwall is a newly formed
independent asset-management firm regulated by the SEC as a Registered
Investment Advisor, owned and operated by the former Riverstone Credit
Partners team. Services provided by Breakwall commenced on 2 January 2024.
Under the arrangement, Riverstone has remained the manager of RCOI on the
terms of RCOI's existing management agreement and all aspects of the ongoing
management of the Company, including the day-to-day investment team, have
remained consistent with current practices. There was no increase in fees
payable by RCOI as a result of the modified arrangements. The Board of RCOI
was involved in establishing the Sub-Management Agreement and are confident
that the structure of Riverstone as manager and Breakwall as the sub-manager
will continue to deliver strong returns for shareholders during this period of
managed wind-down.
INVESTMENT PORTFOLIO SUMMARY
As of 30 June 2025, the Company holds a portfolio of investments in seven
companies across energy infrastructure & infrastructure services and
energy transition assets as further discussed below. In addition, RCOI holds
the warrants of one investment where the loan was fully realised.
The portfolio consists of the following:
· loans and equitised investments expected to generate future
returns - Harland & Wolff, Seawolf Water Resources, Hoover Circular
Solutions, and Max Midstream;
· loans held at de minimis value - Caliber Midstream; and
· equity held at zero value - Imperium3 New York, Inc. and its
equity in Charge CCCV.
These classifications reflect the current assessment of each investment's
potential to contribute to future returns.
In the descriptions that follow, yield to maturity is inclusive of all upfront
fees, original issue discounts, drawn spreads and prepayment penalties through
the stated maturity of the loan. Most loans have incentives to be called
early. A portion of the loans have a "payment-in-kind" feature for drawn
coupons for a limited time period. Similarly, some of the loans have a
"delayed-draw" feature that allows the borrower to call capital over time, but
always with a hard deadline. Loans that are committed are loans with signed
definitive documentation where a structuring fee and/or original issue
discount have been earned and the Company earns an undrawn spread. Loans that
are invested are signed with definitive documentation and, where a structuring
fee and/or original issue discount have been earned, the Company has funded
the loan to the Borrower and the Company is earning a drawn coupon.
The Investment Manager expects that every loan it has made will advance the
cause of energy transition one way or another. For new green energy
infrastructure, or conversion of older assets to a more sustainable use, we
typically issue Green Loans. For existing hydrocarbon related businesses, we
typically issue Sustainability-Linked Loans that tie loan economics to meeting
specific sustainability performance targets. Both structures are based on LSTA
guidelines and are subject to third party independent opinion from Sustainable
Fitch, a division of Fitch Group focused on ESG.
Harland & Wolff - In March 2022, RCOI participated in a $35.0 million
first lien Green Term Loan to Harland & Wolff ("H&W"), an
infrastructure operator engaged in the development and operation of strategic
maritime assets across the United Kingdom. This loan has subsequently been
upsized to $140 million and was due to mature in December 2024 and entered
into a forbearance agreement that expired on 31(st) of January 2025. Harland
& Wolff entered administration subsequently.
At the initial closing RCOI committed $11.8 million. This has subsequently
been upsized to $14.6 million. As of 30 June 2025, $11.1 million remains
invested, reflecting 25.1 per cent of RCOI's overall commitments.
On 12 May 2025, the Company received $3.5 million cash payment from Harland
& Wolff. The Company is entitled to potential claims and an equitised
interest from Harland & Wolff post the administration process. In
addition, RCOI retains its interest of c. 14.8% in the Islandmagee Gas Storage
Project, which has been initially capitalised to fund the go-forward
permitting process before deciding how best to develop and/or monetise the
asset.
Seawolf Water Resources - In September 2022, RCOI made a secondary investment
in a stapled bundle of private securities in Seawolf Water Resources
("Seawolf"), a privately held water infrastructure services company with
operations primarily in Loving County, TX and southern New Mexico. The
investment includes a Sustainability-Linked first lien term loan along with
preferred stock and common equity, collectively purchased at a significant
discount to market value. The loan portion of the investment is due in March
2026 and was purchased at an estimated all-in yield to maturity of 10.6 per
cent to RCOI. The preferred stock and common equity are perpetual in nature
but benefit from excess cash returned to the shareholders from time to time.
Across the term loan, preferred stock, and common equity, RCOI committed a
total of $9.0 million, which has subsequently been reduced to $8.5 million via
repurchases of preferred stock by the company. This reflects 19.1 per cent of
RCOI's overall commitments as of 30 June 2025.
Hoover Circular Solutions - In November 2022, RCOI participated in a $160
million Sustainability-Linked first lien term loan to Hoover CS, a leading
provider of sustainable packaging and fleet management solutions, that is
paving the way for customers across the chemical, refining and general
industrial-end markets to move away from single-use containers. Sustainable
Fitch provided a Second Party Opinion ("SPO") on the loan. The loan is due in
November 2026 and was made at an estimated all-in yield to maturity of 10.6
per cent.
At closing, RCOI committed $13.7 million. As of 30 June 2025, the full $13.7
million remains invested, reflecting 31.0 per cent of RCOI's overall
commitments.
Max Midstream - In December 2022, RCOI participated in a $28.3 million
Sustainability-Linked, first lien term loan (the "Term Loan") to a subsidiary
of Max Energy Industrial Holdings US LLC ("Max"). Max is developing the first
carbon-neutral crude oil export terminal on the Gulf Coast of Texas, which it
believes will lead to increased market share as crude consumers globally seek
to reduce their overall carbon footprint. As of 30 June 2025, the term loan
was ABR + 5.50%, plus an additional 2.00% penalty interest for an all-in
coupon of 15.00%.
At close, RCOI committed $5.0 million. As of 30 June 2025, the full $5.0
million remains invested, reflecting 11.3 per cent of RCOI's overall
commitments.
Streamline Innovations - In June 2023, RCOI participated in a $55 million
Green term loan to Streamline Innovations, a leader in
environmentally-advanced treatment solutions for the removal of hydrogen
sulphide (H2S) from natural gas, renewable fuels, wastewater, and industrial
processes. The facility was structured as a Green Loan with Sustainable Fitch
providing a Second Party Opinion. The loan is due in December 2026 and was
made at an estimated all-in yield to maturity of 12.5 per cent.
At closing, RCOI committed $9.9 million and funded $3.5 million. As of 30 June
2025, RCOI's commitment was reduced to $5.5 million, with $4.4 million
unfunded commitment which expired 31 December 2024, representing 12.1 per cent
of RCOI's total commitments.
On 18 July 2025, RCOI successfully realised its first lien green loan in
Streamline Innovations at a 20 percent gross IRR (15 percent net IRR) and
1.33x gross MOIC (1.25x net MOIC).
Imperium3 New York, Inc - In April 2021, RCOI participated in a $63.0 million
first lien delayed-draw Green term loan to Imperium 3 New York, Inc, as
lithium-ion battery company that will commercialise high performing
lithium-ion batteries by developing a large-scale manufacturing facility in
Endicott, NY. The loan was fully refinanced in April 2022, with a new source
of financing, resulting in a 32.5 per cent realised IRR and 1.25x realised
MOIC.
At closing, RCOI committed $6.8 million. In addition, as part of the loan
terms, RCOI was granted warrants to purchase 0.4 per cent of the Imperium's
equity and 0.3 per cent of the equity in one of
Imperium's parent company's Charge CCCV. As of 30 June 2025, none of the loan
is outstanding but the warrants remain in the Company's portfolio.
On January 27, 2025, Imperium3 New York, Inc. filed for Chapter 11 bankruptcy
protection resulting in the warrants being devalued to zero. While Charge CCCV
is not part of the bankruptcy filing, the equity held in Charge CCCV has been
written down to de minimis value due to the resulting impairment in value.
Caliber Midstream - In July 2019, RCOI participated in a $10.0 million upsize
of a $65.0 million first lien holding company term loan to Caliber Midstream
(the "HoldCo Term Loan"), a sponsor-backed Bakken focused midstream company
that provides crude oil and natural gas gathering and processing, produced
water transportation and disposal, and freshwater sourcing and transportation.
At closing, RCOI committed $3.4 million to the HoldCo Term Loan. Subsequently,
in April 2021, an additional $0.6 million was invested on a secondary basis in
a senior secured first lien loan made to Caliber (the "Opco Loan"), bringing
RCOI's total commitment to Caliber to $4.0 million.
In March 2021, Caliber's largest customer, Nine Point Energy, terminated their
midstream contract with Caliber and subsequently filed for Chapter 11
bankruptcy. In May 2021, RCOI and the other HoldCo Lenders completed a
recapitalisation of Caliber resulting in HoldCo Term Loan Lenders receiving
substantially all of the equity in HoldCo.
In March 2022, the Caliber and the OpCo Loan lenders subsequently closed a
second restructuring with the OpCo Loan lenders receiving approximately 100%
of the equity. Following the restructuring, new management was hired, a new
contract was executed and there remains increased focus on cost cutting
initiatives and new revenue opportunities.
As of 30 June 2025, $0.6 million of commitment remains invested, reflecting
1.4% of RCOI's overall commitments post restructuring.
BUSINESS REVIEW
MANAGED WIND-DOWN
Following the AGM on 22 May 2024 the Company adopted a wind-down investment
policy. Details of the adoption of the managed wind-down are as follows:
· The Company's investment objective and investment policy is now
to realise the Company's assets on a timely basis with the goal of making
returns of cash to holders of Ordinary Shares as soon as practicable.
· The Investment Manager is actively seeking exit opportunities to
realise the loans comprising the Company's portfolio and returning the
resulting proceeds to Shareholders. The Investment Manager may dispose of
loans in the secondary market.
· The Company will maintain its listing on the Specialist Fund
Segment and continue to conduct its affairs (including as regards payment of
dividends) so as to qualify as an investment trust for the purposes of section
1158 of the Corporation Tax Act 2010, in each case for as long as the Board
believes such status to be practicable and cost-effective for Shareholders.
· The unaudited net asset value of the Company will continue to be
calculated on a quarterly basis in accordance with the Company's accounting
policies per the notes to the financial statements and will be published
through a Regulatory News Service, although the Board would keep this net
asset value reporting policy under review in light of the diminishing size of
the Company's portfolio during the course of the managed wind-down.
· The precise mechanism for the return of cash to holders of
Ordinary Shares in a managed wind-down will be at the discretion of the Board,
but will include a combination of capital distributions, tender offers,
mandatory share redemptions and share buybacks. The return of proceeds to
Shareholders may require further Shareholder approvals, depending on the
methods used.
GOING CONCERN
As of the date of the report, the Directors are required to consider whether
they have a reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. Following the
AGM held on 22 May 2024 at which Shareholders voted in favour of a change in
the Company's Investment Policy to Wind-Down Investment policy, the Investment
Manager is actively considering exit opportunities of each investment to
maximise returns for shareholders.
The Company's investment objective and Wind-Down Investment Policy is "to
realise the Company's assets on a timely basis with the goal of making returns
of cash to holders of Ordinary Shares as soon as practicable". The Investment
Manager is actively seeking exit opportunities to realise the loans comprising
the Company's portfolio and returning the resulting proceeds to Shareholders.
The Company is therefore preparing its financial statements on a basis other
than going concern due to the Company being in a managed wind-down.
The Company will continue to carry on its investment business during the
managed wind-down and with the expectation of realising the Company's assets
and returning of capital to its Shareholders.
The Directors consider that the change to the Company's objectives and
Investment Policy, are in the best interests of Shareholders as a whole.
In addition, with the Company amending its Investment Policy to Wind-Down
Investment Policy, the senior secured revolving credit facility's ("RCF")
credit agreement with the Company was also amended. The RCF credit agreement
was amended to allow aggregate amount of borrowings of up to US$500,000 in
order to optimise cash flows during the Managed Wind-Down. The amendment also
sets forth a Utilisation Fee of one percent per annum due and payable
quarterly by the Company to the lender.
As of 30 June 2025, the Company has sufficient cash held in the SPVs reflected
in the value of the Company's investments in the SPVs. As of the date of the
financial statements, the Company and its SPVs have $19.25m cash and cash
equivalents available of which $0.50m is short-term money market fix deposits,
$1.84m in cash within the SPVs and the remaining $16.91m cash held by the
Company. The Company's cash balance includes $16.80m for the Compulsory
Redemption of Ordinary shares. The Company's and its SPVs current cash will be
able to meet the near-term current liabilities when come due.
Whilst the Directors are satisfied that the Company has adequate resources to
continue in operation throughout the wind down period and will be able to meet
all of its liabilities as they fall due, given the Company is now in managed
wind-down, the Directors considered it to be appropriate to adopt the basis
other than going concern in preparing the financial statements. There were no
material changes in the valuation of investments held at fair value as a
result of ceasing to apply the going concern basis. All of the balance sheet
items have been recognised on a realisation basis, which is not materially
different from the carrying amount. The Directors and the Investment Manager
have made the appropriate provisions in order to bring about an orderly
wind-down of the Company and its operations.
As of 30 June 2025, the weighted average remaining contractual tenor of the
loans in the Company's portfolio is under one year. The Investment Manager is
actively seeking to realise the loans comprising the Company's portfolio by
holding them until they come to term or dispose in the secondary market where
it considers this to be in the best interests of the Company. The Company in
its best efforts, intends to realise and return to shareholders all proceeds
in respect to its investment portfolio by December 2026.
On 27 June 2025, the Company redeemed 19,090,875 Ordinary Shares, which was
approximately 28 per cent. of the Company's Ordinary Shares by way of a
Compulsory Redemption of Ordinary Shares. The Directors will make further
announcements on the progress of the Managed Wind-Down strategy and the return
of cash to Shareholders in due course.
PRINCIPAL RISKS AND UNCERTAINTIES
Under the FCA's Disclosure Guidance and Transparency Rules, the Directors are
required to identify those material risks to which the Company is exposed and
take appropriate steps to mitigate those risks. Risks relating to the Company
are disclosed in the Company's prospectus which is available on the Company's
website https://www.riverstonecoi.com (https://www.riverstonecoi.com) .
The Company's assets consist of investments, through SPVs, within the global
energy industry, with a particular focus on opportunities in the global
E&P and midstream energy sub-sectors. The Company also focuses on energy
transition, infrastructure and infrastructure services by structuring deals as
either a Green Loan or a Sustainability-Linked Loan. Its principal risks are
therefore related to market conditions in the energy sector in general, but
also the particular circumstances of the businesses in which it is invested.
The Investment Manager seeks to mitigate these risks through active asset
management initiatives.
The Board thoroughly considers the process for identifying, evaluating and
managing any significant and emerging risks faced by the Company on an ongoing
basis and has performed a robust assessment of those risks, which are reported
and discussed at Board meetings.
PRINCIPAL RISKS AND UNCERTAINTIES
The Board ensures that effective controls are in place to mitigate these risks
and that a satisfactory compliance regime exists to ensure all applicable
local and international laws and regulations are upheld.
For each material risk, the likelihood and consequences are identified,
management controls and frequency of monitoring are confirmed and results
reported and discussed at the quarterly Board meetings.
The key areas of risk faced by the Company and mitigating factors are
summarised below:
1. The Ordinary Shares may trade at a discount to NAV per Share for
reasons including but not limited to market conditions, liquidity concerns and
actual or expected Company performance. In its efforts to mitigate this risk,
the Investment Manager closely monitors and identifies the reasons for
significant fluctuations, and considers the Company's share repurchase program
when applicable and in the interests of Shareholders. As such, there can be no
guarantee that attempts to mitigate such discount will be successful or that
the use of discount control mechanisms will be possible, advisable or adopted
by the Company.
2. Investment decisions of the Investment Manager will depend upon the
ability of its employees and agents to gather relevant information. The
Company would continue to carry on its investment business during the managed
wind-down.
3. The Company's Investment objective and Wind-Down Investment Policy is
to "realise the Company's assets on a timely basis with the goal of making
returns of cash to holders of Ordinary shares as soon as practicable." The
Investment Manager will manage current investments in accordance with the
Investment Policy, market conditions and the economic environment. To mitigate
the risk of realising investments not indicative of the fair value, the
Company's Investment Policy and investment restrictions enable the Company to
realise the loans comprising the Company's portfolio by holding them until
they come to term and returning the resulting proceeds to Shareholders, with
the precise mechanism for the return of cash to holders of Ordinary Shares in
the managed wind-down at the discretion of the Board.
4. Environmental exposures and existing and proposed environmental
legislation and regulation may adversely affect the operations of Borrowers.
Delay or failure to satisfy any regulatory conditions or other applicable
requirements could hinder the operations of certain Borrowers. To mitigate
this risk, the Investment Manager has usual and customary inspection rights
and affirmative covenants regarding environmental matters contained in credit
agreement documentation.
5. The valuations used to calculate the NAV on a quarterly basis will be
based on the Investment Manager's unaudited estimated fair market values of
the Company's investments and may be based on estimates which could be
inaccurate. To mitigate this risk, the Investment Manager has an extensive
valuation policy and also has engaged the independent valuation services of
Houlihan Lokey on a quarterly basis.
6. In today's global technological environment, the Company, its
investments and its engaged service providers are subject to risks associated
with cyber security. The effective operation of the Investment Manager and the
businesses of Borrowers are likely to be highly dependent on the availability
and operation of complex information and technological systems. To mitigate
this risk, the Audit and Risk Committee Chairman monitors cyber security risk
and best practices. Cyber security due diligence and ongoing monitoring is
performed on each potential and current borrower.
7. The Company may be exposed to fluctuations and volatility in commodity
prices through its investments, and adverse changes in global supply and
demand and prices for such commodities may adversely affect the business,
results of operations, and financial condition of the Company. To mitigate
this risk, the Investment Manager has created a diversified portfolio across
various energy subsectors, commodity exposures, technologies and end-markets
to provide natural synergies that aim to enhance the overall stability of the
portfolio.
8. The Company has only lent to Borrowers in the global energy sector and
such single industry concentration could affect the Company's ability to
generate returns. Adverse market conditions in the energy sector may delay or
prevent the Company from realising investments. To mitigate this risk, the
Investment Manager has created a diversified portfolio across various energy
subsectors, commodity exposures, technologies and end-markets to provide
natural synergies that aim to enhance the overall stability of the portfolio.
9. The performance of the Company may be affected by changes to interest
rates and credit spreads. To mitigate this risk, the Investment Manager
assesses credit risk and interest rate risk on an ongoing basis and closely
monitors each investment with the assistance of each respective management
team and the engaged service providers.
10. The Company relies on a third-party provider for the key operational
tasks of the Company. The failure of any service provider to carry out their
duty may have a detrimental effect on
the operation of the Company. To mitigate these risks the Board will review
the internal control reports and consider business continuity arrangements of
the Company.
The principal risks outlined above remain the most likely to affect the
Company in the second half of the year
Directors' Responsibilities Statement
The Directors are responsible for preparing this Interim Report in accordance
with applicable law and regulations.
The Directors confirm that to the best of their knowledge:
· The unaudited interim condensed financial statements have been
prepared in accordance with UK-adopted IAS 34 Interim Financial Reporting; and
· The Chairman's Statement, Investment Manager's Report and the
notes to the condensed financial statements include a fair review of the
information required by:
i. DTR 4.2.7R of the Disclosure Guidance and Transparency Rules, being
an indication of important events that have occurred during the period and
their impact on the unaudited interim condensed financial statements; and a
description of the principal risks and uncertainties for the remaining six
months of the year; and
ii. DTR 4.2.8R of the Disclosure Guidance and Transparency Rules, being
related party transactions that have taken place in the period and that have
materially affected the financial position and performance of the Company
during that period.
· For the reasons stated in the Business Review and Note 2, the
financial statements have not been prepared on a going concern basis.
On behalf of the Board
Reuben Jeffery, III
Chairman
14 August 2025
Condensed Statement of Financial Position
As at 30 June 2025
30 June 2025 31 December 2024
Note $'000 $'000
Current assets
Investments at fair value through profit or loss 4 44,730 62,735
Trade and other receivables 6 235 169
Cash and cash equivalents 16,909 328
61,874 63,232
Current liabilities
Trade and other payables 7 (17,582) (678)
Net current assets 44,292 62,554
Net assets 44,292 62,554
Equity
Share capital 8 491 682
Capital redemption reserve 8 509 318
Other distributable reserves 8 44,450 61,795
Retained earnings 9 (1,158) (241)
Total Shareholders' funds 44,292 62,554
Number of Shares in issue at period/year end 49,066,161 68,157,036
Net assets per share (cents) 13 90.27 91.78
The interim condensed financial statements were approved and authorised for
issue by the Board of Directors on 14 August 2025 and signed on its behalf by:
Reuben Jeffery,
III
Emma Davies
Chairman
Director
The accompanying notes below form an integral part of these interim condensed
financial statements.
Condensed Statement of Comprehensive Income
For the six months ended 30 June 2025 (Unaudited)
For the six months ended For the six months ended
30 June 2025
30 June 2024
Note Revenue Capital Total Revenue Capital Total
$'000 $'000 $'000 $'000 $'000 $'000
Investment (loss)
Change in fair value of investments at fair value through profit or loss 4 - (2,541) (2,541) - (1,492) (1,492)
- (2,541) (2,541) - (1,492) (1,492)
Income
Investment income 4 2,377 - 2,377 3,028 - 3,028
2,377 - 2,377 3,028 - 3,028
Expenses
Directors' fees and expenses (83) - (83) (76) - (76)
Other operating expenses (624) - (624) (607) - (607)
Liquidation expenses - - - - (500) (500)
Profit share 10 (50) - (50) (147) - (147)
Total expenses (757) - (757) (830) (500) (1,330)
Operating (loss)/profit for the period 1,620 (2,541) (921) 2,198 (1,992) 206
Finance income
Interest income 4 - 4 11 - 11
Total finance income 4 - 4
(Loss)/profit for the period before tax 1,624 (2,541) (917) 2,209 (1,992) 217
Tax 11 - - - - - -
(Loss)/profit for the period after tax 1,624 (2,541) (917) 2,209 (1,992) 217
(Loss)/profit and total comprehensive (loss)/ income for the period 1,624 (2,541) (917) 2,209 (1,992) 217
(Loss)/profit and total comprehensive (loss)/ income for the period
attributable to:
Equity holders of the Company 1,624 (2,541) (917) 2,209 (1,992) 217
(Loss)/Earnings per share
Basic and diluted (loss)/earnings per Share (cents) 12 2.40 (3.75) (1.35) 2.43 (2.19) 0.24
The 'Total' column of this statement is the profit and loss account of the
Company and the 'Revenue' and 'Capital' columns represent supplementary
information prepared under guidance issued by the Association of Investment
Companies. Profit / (loss) for the period after tax also represents Total
Comprehensive Income.
The accompanying notes below form an integral part of these interim condensed
financial statements.
Condensed Statement of Changes in Equity
For the six months ended 30 June 2025 (Unaudited)For the six months ended Share capital Capital redemption reserve Other distributable reserves Retained earnings Total
30 June 2025
Note $'000 $'000 $'000 $'000 $'000
Opening net assets attributable to Shareholders 682 318 61,795 (241) 62,554
Share redemption (191) 191 (16,800) - (16,800)
Total comprehensive loss for the period - - - (917) (917)
Distributions paid in the period 13 - - (545) - (545)
Closing net assets attributable to Shareholders 491 509 44,450 (1,158) 44,292
Following the IPO of the Company, the share premium account was cancelled by a
court order dated 16 July 2019. The amount of $97,000 remaining in the share
premium account of the Company at this date was subsequently cancelled and
transferred to distributable reserves. This may be applied in any manner in
which the Company's profits available for distribution are able to be applied,
as determined in accordance with the Companies Act 2006.
On 23 May 2025 the Company announced a Compulsory Redemption of Ordinary
shares. On 27 June 2025 the Company redeemed (on a pro rata basis) 19,090,875
Ordinary shares of $0.88 per Ordinary Share. The Ordinary Shares redeemed were
equal to approximately 28 per cent of the Company's Ordinary Shares in issue
at the Redemption date.
The Company's total distributable reserves comprise its other distributable
reserve and retained earnings, excluding unrealised movement of its
investments. After taking account of cumulative unrealised loss of $8.96m and
distributions made, the total distributable reserves as at 30 June were
$52.26m
Share capital Capital redemption reserve Other distributable reserve Retained earnings Total
For the six months ended 30 June 2024 Note $'000 $'000 $'000 $'000 $'000
Opening net assets attributable to Shareholders 908 92 90,528 4,496 96,024
Total comprehensive income for the period - - - 217 217
Distributions paid in the period 13 - - - (4,108) (4,108)
Closing net assets attributable to Shareholders 908 92 90,528 605 92,133
The Company's total distributable reserves comprise its other distributable
reserve and retained earnings, excluding unrealised movement of its
investments. After taking account of cumulative unrealised gains of $0.95m and
distributions made, the total distributable reserves as at 30 June 2024 were
$90.18m.
The accompanying notes below form an integral part of these interim condensed
financial statements.
Condensed Statement of Cash Flows
For the six months ended 30 June 2025 (Unaudited)
Note For the six months ended For the six months ended
30 June 2025
30 June 2024
$'000 $'000
Cash flows from operating activities
(Loss)/profit for the period before tax (917) 217
Adjustments for non-cash transaction in profit for the year before tax:
Interest Income (4) (11)
Movement in fair value of investments 4 2,541 1,492
Investment income 4 (2,377) (3,028)
Adjustments for statement of financial position movement:
Movement in payables 104 (87)
Movement in receivables (67) (62)
Bank interest received in cash 5 13
Loan interest received 4 661 3,302
Dividends received 380 2,018
Net cash generated from operating activities 326 3,854
Cash flows from investing activities
Investment proceeds 4 16,800 -
Net cash generated from investing activities 16,800 -
Cash flows from financing activities
Distributions paid 13 (545) (4,108)
Net cash used in financing activities (545) (4,108)
Net movement in cash and cash equivalents during the period 16,581 (254)
Cash and cash equivalents at the beginning of the period 328 627
Cash and cash equivalents at the end of the period 16,909 373
The accompanying notes below form an integral part of these interim condensed
financial statements.
Notes to the Unaudited Interim Condensed Financial Statements
For the six months ended 30 June 2025
1. General Information
The Company was incorporated and registered in England and Wales on 11 March
2019 with registered number 11874946 as a public company limited by shares
under the Companies Act 2006
(the ''Act''). The principal legislation under which the Company operates is
the Act. The Directors intend, at all times, to conduct the affairs of the
Company so as to enable it to qualify as an investment trust for the purposes
of section 1158 of the Corporation Tax Act 2010, as amended.
2. Basis of preparation
The condensed financial statements have been prepared in accordance with the
provisions of the Companies Act 2006, with UK-adopted International Accounting
Standards ("UK-adopted IAS") 34 Interim Financial Reporting, and the
Disclosure Guidance and Transparency Rules of the United Kingdom's Financial
Conduct Authority. Where presentational guidance set out in the AIC SORP, 2022
edition, is consistent with the requirements of UK-adopted IAS, the Directors
have sought to prepare the condensed financial statements on a basis compliant
with the recommendations of the AIC SORP. In particular, supplementary
information which analyses the Statement of Comprehensive Income between items
of a revenue and capital nature has been presented alongside the total
Statement of Comprehensive Income.
The condensed financial statements have been prepared on a realisation basis
(basis other than going concern). As a result of the change of basis and
considering the costs of the wind-down process a provision of liquidation
expenses of $343k was recorded in trade and other payables at 31 December
2024, with $318k remaining at 30 June 2025. The investments at fair value
through profit & have been presented within current assets as the loans in
the Company's portfolio is expected to be realised under one year. The
Company, on a best-efforts basis, aims to realise and return proceeds to
shareholders from its investment portfolio as promptly as practicable
following the commencement of the managed wind-down, noting that the process
has now been extended beyond the initial one-year time frame. No other
material adjustments to accounting policies or the valuation basis have arisen
as a result of ceasing to apply the going concern basis. All of the balance
sheet items have been recognised on a realisation basis, which is not
materially different from the fair valued carrying amount.
These condensed financial statements do not constitute statutory accounts as
defined in section 434 of the Companies act and do not include all information
and disclosures required in an Annual Report. They should be read in
conjunction with the Company's Annual Report for the year ended 31 December
2024.
The Company's Annual Report for the year ended 31 December 2024 included an
unqualified audit report that included an Emphasis of Matter highlighting that
the financial statements were prepared on a basis other than going concern.
The audit report did not contain any statements under sections 498 (2) and (3)
of the Companies Act 2006. A copy of this annual report has been delivered to
the Registrar of Companies.
Going concern
As of the date of the report, the Directors are required to consider whether
they have a reasonable expectation that the Company has adequate resources to
continue in operational existence for the foreseeable future. Following the
AGM held on 22 May 2024 at which Shareholders voted in favour of a change in
the Company's Investment Policy to Wind-Down Investment Policy, the Investment
Manager is actively considering exit opportunities of each investment to
maximise returns for shareholders.
The Company's investment objective and Wind-Down Investment Policy is "to
realise the Company's assets on a timely basis with the goal of making returns
of cash to holders of Ordinary Shares as soon as practicable". The Investment
Manager is actively seeking exit opportunities to realise the loans comprising
the Company's portfolio and returning the resulting proceeds to Shareholders.
The Company is therefore preparing its financial statements on a basis other
than going concern due to the Company being in a managed wind-down.
The Company will continue to carry on its investment business during the
managed wind-down and with the expectation of realising the Company's assets
and returning of capital to its Shareholders.
The Directors consider that the change to the Company's objectives and
Investment Policy, are in the best interests of Shareholders as a whole.
In conjunction with the Company amending its Investment Policy to Wind-Down
Investment Policy, the senior secured revolving credit facility's ("RCF")
credit agreement with the Company was also amended. The RCF credit agreement
was amended to allow aggregate amount of borrowings of up to US$500,000 in
order to optimise cash flows during the Managed Wind-Down. The amendment also
sets forth a Utilisation Fee of one percent per annum due and payable
quarterly by the Company to the lender. On 1(st) July 2025, the RCF was
terminated and a Payoff Letter executed, releasing obligators under the Loan
document and Credit agreement.
As of 30 June 2025, the Company has sufficient cash held in the SPVs reflected
in the value of the Company's investments in the SPVs. As of the date of the
financial statements, the Company and its SPVs have $19.25m cash and cash
equivalents available of which $0.5m is short-term money market fix deposits,
$1.84m in cash within the SPVs and the remaining $16.91m cash held by the
Company. The Company's cash balance includes $16.8m for the Compulsory
Redemption of Ordinary shares. The Company's and its SPVs current cash will be
able to meet the near-term current liabilities when come due.
Whilst the Directors are satisfied that the Company has adequate resources to
continue in operation throughout the wind down period and will be able to meet
all of its liabilities as they fall due, given the Company is now in managed
wind-down, the Directors considered it to be appropriate to adopt the basis
other than going concern in preparing the financial statements. There were no
material changes in the valuation of investments held at fair value as a
result of ceasing to apply the going concern basis. All of the balance sheet
items have been recognised on a realisation basis, which is not materially
different from the carrying amount. The Directors and the Investment Manager
have made the appropriate provisions in order to bring about an orderly
wind-down of the Company and its operations.
As of 30 June 2025, the weighted average remaining contractual tenor of the
loans in the Company's portfolio is under one year. The Investment Manager is
actively seeking to realise the loans comprising the Company's portfolio by
holding them until they come to term or dispose in the secondary market where
it considers this to be in the best interests of the Company. The Company in
its best efforts, intends to realise and return to shareholders all proceeds
in respect to its investment portfolio by December 2026.
On 27 June 2025, the Company redeemed 19,090,875 Ordinary Shares, which was
approximately 28 per cent. of the Company's Ordinary Shares by way of a
Compulsory Redemption of Ordinary Shares. The Directors will make further
announcements on the progress of the Managed Wind-Down strategy and the return
of cash to Shareholders in due course.
Segmental Reporting
The chief operating decision-maker, who is responsible for allocating
resources and assessing performance of the operating segments, has been
identified as the Board of Directors, as a whole. The key measure of
performance used by the Board to assess the Company's performance and to
allocate resources is the Company's Net Asset Value, as calculated under
UK-adopted IAS, and therefore, no reconciliation is required between the
measure of profit or loss used by the Board and that contained in the Interim
Report.
For management purposes, the Company is organised into one main operating
segment, which invests through its SPVs in a diversified portfolio of debt
instruments, issued by Borrowers operating in the energy sector. All of the
Company's current income is derived from within the United States.
All of the Company's non-current assets are located in the United States. Due
to the Company's nature, it has no customers.
Seasonal and Cyclical Variations
The Company's results do not vary as a result of seasonal activity.
3. Significant accounting judgements, estimates and assumptions
The preparation of the financial statements requires management to make
judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets, liabilities, income
and expenses.
Judgements, estimates and assumptions are continually evaluated and are based
on management experience and other factors, including expectations of future
events that are believed to be reasonable under the circumstances.
Estimates and assumptions that are significant to the financial statements
include the valuation of the investments as detailed in note 4 and the
potential impact of climate change.
Further details of these judgements, estimates and assumptions made by the
Directors are given in the annual financial statements for the year ended 31
December 2024. During the interim period there has been no change to the
judgements, estimates and assumptions outlined in the annual report.
4. Investments at fair value through profit or loss
Reconciliation of Level 3 fair value measurements of financial assets
For the six months ended For the six months ended 30 June 2024
30 June 2025
Loans Equity Total Loans Equity Total
$'000 $'000 $'000 $'000 $'000 $'000
Opening balance 44,593 18,142 62,735 60,800 33,839 94,639
Investment (proceeds) (11,592) (5,208) (16,800) - - -
Movement in loan interest receivable 1,336 - 1,336 (564) - (564)
Unrealised movement in fair value of investments - (2,541) (2,541) - (1,492) (1,492)
34,337 10,393 44,730 60,236 32,347 92,583
As set out above the Company's investment in Riverstone International Credit
Corp. comprises of a loan investment and an equity investment and the
investment in Riverstone International Credit L.P. comprises of an equity
investment. The SPVs invest in a diversified portfolio of direct and indirect
investments in loans, notes, bonds and other debt instruments.
Interest receivable on the loan investment at 30 June 2025 is $2.4m (31
December 2024: $1.1m). The unrealised movement in fair value of investments
was shown in the Change in fair value of investments at fair value through
profit or loss in the Condensed Statement of Comprehensive Income.
The dividend receivable on the equity investment at 30 June 2025 was $nil (31
December 2024: $nil). The total unfunded commitments of the Company by its SPV
investments as at 30 June 2025 is $nil (31 December 2024: $nil).
Reconciliation of investment income recognised in the period
For the six months ended For the six months ended
30 June 2024
30 June 2024
$'000 $'000
Movement in loan interest receivable at year end 1,336 (564)
Loan interest received as cash 661 3,302
Total loan interest recognised in the period 1,997 2,738
Dividend income 380 290
Total investment income recognised in the period 2,377 3,028
Total cash received in relation to interest income in the period was $0.7m
(2024: $3.3m). This comprises $0.7m (2024: $3.3m) of loan interest in the
period and $nil (2024: $nil) of amounts capitalised in the prior period.
Fair value measurements
As disclosed in the Company's Annual Report for the year ended 31 December
2024, IFRS 13 "Fair Value Measurement" requires disclosure of fair value
measurement by level.
The level of fair value hierarchy within the financial assets or financial
liabilities ranges from level 1 to level 3 and is determined on the basis of
the lowest level input that is significant to the fair value measurement.
The fair value of the Company's investments is ultimately determined by the
fair values of the underlying investments. Due to the nature of the
investments, they are always expected to be classified as level 3 as the
investments are not traded and contain unobservable inputs. There have been no
transfers between levels during the six months ended 30 June 2025 (31 December
2024: none).
Valuation methodology and process
The Directors base the fair value of investment in the SPVs on the fair value
of their assets and liabilities, adjusted, if necessary, to reflect liquidity,
future commitments, and other specific factors of the SPVs and Investment
Manager. This is based on the components within the SPVs, principally the
value of the SPVs' investments, in addition to cash and short-term money
market fixed deposits. Any fluctuation in the value of the SPVs' investments
held will directly impact on the value of the Company's investment in the
SPVs.
The Company's investment in Riverstone International Credit Corp. comprises a
debt and an equity investment and is valued as one unit of account.
Investment held by SPVs
The SPVs' investments are valued using the techniques described in the
Company's valuation policy, as outlined in note 2. The Investment Manager's
assessment of fair value of investments held by the SPVs is determined in
accordance with IPEV Valuation Guidelines. When valuing the SPVs' investments,
the Investment Manager reviews information provided by the underlying investee
companies and other business partners and applies IPEV methodologies, to
estimate a fair value as at the date of the Statement of Financial Position.
Initially, acquisitions are valued at fair value, which is normally the
transaction price. Subsequently, and as appropriate, the Investment Manager
values the investments on a quarterly basis using common industry valuation
techniques, including comparable public market valuation, comparable merger
and acquisition transaction valuation and discounted cash flow valuation. The
techniques used in determining the fair value of the Company's investments
through its SPVs are selected on an investment-by-investment basis so as to
maximise the use of market based observable inputs. These techniques also
reflect the impact of primary and transition risks on the portfolio, although
the impact of the risks is minimal as the maximum investment period is seven
years. As disclosed in note 2, due to the illiquid and subjective nature of
the Company's underlying investments, the Investment Manager uses a
third-party valuation provider to perform a full independent valuation of the
underlying investments.
Quantitative information of significant unobservable inputs - Level 3 - SPV
30 June 2025 Valuation Unobservable Range / weighted
Description $'000 technique input average
SPV 44,730 Adjusted net asset value NAV 44,730
The Directors believe that it is appropriate to measure the SPVs at their
adjusted net asset value, incorporating a valuation of the underlying
investments which has taken into account risks to fair value, inclusive of
liquidity discounts, through appropriate discount rates.
Sensitivity analysis to significant changes in unobservable inputs within
Level 3 hierarchy
The significant unobservable inputs used in the fair value measurement
categorised within Level 3 of the fair value hierarchy together with a
quantitative sensitivity analysis as at 30 June 2025 are as shown below:
Sensitivity Effect on
Description Input used fair value
$'000
SPV Discount for lack of liquidity - 3% (1,342)
The Company's valuation policy is compliant with both UK-adopted IAS and IPEV
Valuation Guidelines and is applied consistently. As the Company's investments
are generally not publicly quoted, valuations require meaningful judgment to
establish a range of values, and the ultimate value at which an investment is
realised may differ from its most recent valuation and the difference may be
significant.
For the period ended 30 June 2025, the valuations of the Company's
investments, through its SPVs, are detailed in the table below and also
detailed in the Investment Manager's Report.
The below table shows the investments held by SPVs fair value sensitivities to
a 100 BPS increase in the discount rate and 0.5x multiple decrease used for
each industry as at 30 June 2025.
Industry Investments at Fair Value as of June 30, 2025 Valuation technique(s) Unobservable input(s) Range Fair Value Sensitivity to a 100 bps increase in the discount
rate
(In Thousands)
(In Thousands)
Low High
Infrastructure 5,797 Discounted cash flow Discount Rate (66)
5% 17%
Recovery Approach EBITDA multiple 2.50x 6.00x
Infrastructure 24,339 Discounted cash flow Discount Rate
Services 7% 34% (137)
Option Pricing Model Risk Free Rate
-% -%
Energy Transition - Implied Equity Value NA -
NA NA
Services 11,112 Discounted cash flow Discount Rate (803)
6% 7%
Public comparables EBITDA
multiple 6.00x 7.00x
Waterfall Approach NA
NA NA
$ 41,248 $ (1,007)
((a)) The difference between the fair value of the SPVs of $44.7m and the fair
value of the underlying investments at 30 June 2025 is due to cash and cash
equivalent balances of $1.8m, a money market investment of $0.5m and residual
receivables of $1.2m, held within the SPVs.
5. Unconsolidated subsidiaries
The following table shows subsidiaries of the Company. As the Company is
regarded as an Investment Entity these subsidiaries have not been consolidated
in the preparation of the financial statements:
Investment Place of business Ownership interest as at 30 June 2025 Ownership interest as at 31 December 2024
Held directly
Riverstone International Credit Corp. USA 100% 100%
Riverstone International Credit L.P. USA 100% 100%
Held indirectly
Riverstone International Credit - Direct L.P. USA 100% 100%
The registered office of the above subsidiaries is c/o The Corporation Trust
Company, Corporation Trust Center, 1209 Orange Street, Wilmington, Delaware
19801.
Riverstone International Credit Corp. had a net asset value of $5.1m as at 30
June 2025 (31 December 2024: $12.7m) with a gain of $0.4m (31 December 2024:
$10.2m loss).
The amounts invested in the Company's unconsolidated subsidiaries during the
period and their carrying value at 30 June 2025 are as outlined in note 4
comprising:
30 June 2025 31 December 2024
Riverstone International Credit Corp. Riverstone International Credit L.P. Total Riverstone International Credit Corp. Riverstone International Credit L.P. Total
$'000 $'000 $'000 $'000 $'000 $'000
Opening balance at 1 January 57, 335 5,400 62,735 89,406 5,233 94,639
Loan interest receivable 1,336 - 1,336 (315) - (315)
Investment proceeds (16,800) - (16,800) (23,032) - (23,032)
Movement in fair value (2,449) (92) (2,541) (8,724) 167 (8,557)
Closing balance at 30 June/ 31 December 39,422 5,308 44,730 57,335 5,400 62,735
During Q4 2022, the Company's SPVs entered a senior secured RCF agreement for
$15.0 million to enter into new commitments ahead of anticipated realisations,
enabling the Company to minimise the drag on returns of uninvested
capital. The borrowers as defined per the RCF agreement are Riverstone
International Credit - Direct L.P. and Riverstone International Credit L.P.,
and the guarantors are the Company, Riverstone Credit Opportunities Income
Partners - Direct L.L.C., a Delaware limited liability company and Riverstone
Credit Opportunities Income Partners L.L.C., a Delaware limited liability
company.
On 23 April 2024, the SPVs entered into an Amendment to the RCF agreement.
There is now a 'utilisation fee' of 1% per annum paid quarterly on the
difference between the amount of the commitment and the average daily
outstanding principal balance of the loan. There is also an amendment to limit
borrowings to only pay interest on the loans and fees expenses arising under
the agreement and for any follow-on investments.
At 30 June 2025, $nil (31 December 2024: $nil) of the senior secured RCF was
drawn at close and the remaining $15 million (31 December 2024: $15m) undrawn
commitment is available for future borrowings. Pursuant to the RCF agreement,
the interest rate per annum on each borrowing under the RCF can be referenced
to SOFR + 6.50% with a 100bps SOFR floor.
At 30 June 2025 the SPVs borrowed $nil (31 December 2024: $nil), in the six
months to the period ended 30 June 2025 the SPVs incurred $nil million (31
December 2024: $nil million) in fees and $nil million (31 December 2024: $nil)
in interest. Interest is recorded as an interest expense at the SPV level and
is also included in the SPVs' net asset value. The interest rate on 2025
borrowings was SOFR plus 6.50% (31 December 2024: SOFR plus 6.50%).
There are no restrictions on the ability of the Company's unconsolidated
subsidiaries to transfer funds in the form of cash distributions or repayment
of loans. All of the Company's interest income and dividend income is
receivable directly from the Company's SPVs.
6. Trade and other receivables
30 June 2025 31 December 2024
$'000 $'000
Prepayments 132 120
VAT receivable 102 47
Bank interest receivable 1 2
235 169
7. Trade and other payables
30 June 2025 31 December 2024
$'000 $'000
Provision for liquidation costs 318 343
Profit share payable 56 -
Compulsory Redemption payable 16,800 -
Other payables 408 335
17,582 678
8. Share capital and payables
Date Issued and fully paid Number of shares issued Share capital Capital redemption reserve Other distributable reserves Total
GBP £'000 £'000 £'000 £'000
1 January 2025 1 - - - -
30 June 2025 1 - - - -
USD $'000 $'000 $'000 $'000
1 January 2025 68,157,036 682 318 61,795 62,795
Distributions paid in the period - - - (545) (545)
Share redemption (19,090,875) (191) 191 (16,800) (16,800)
30 June 2025 49,066,161 491 509 44,450 45,450
As at 30 June 2025 the Company's issued share capital comprises 49,066,161
Ordinary Shares at $0.01 per share and 1 E Share at $1 per share. Ordinary
Shareholders are entitled to all distributions paid by the Company and, on a
winding up, provided the Company has satisfied all of its liabilities, the
Shareholders are entitled to all of the surplus assets of the Company. E
shares are non-redeemable shares and grant the registered holders the right to
receive notice of and to attend but, except where there are no other shares of
the Company in issue, not to speak or vote (either in person or by proxy) at
any general meeting of the Company.
On 27 June 2025, the Company redeemed 19,090,875 Ordinary Shares, which was
approximately 28 per cent. of the Company's Ordinary Shares by way of a
Compulsory Redemption of Ordinary Shares.
Date Issued and fully paid Number of shares issued Share capital Capital redemption reserve Other distributable reserves Total
GBP £'000 £'000 £'000 £'000
1 January 2024 1 - - - -
30 June 2024 1 - - - -
USD $'000 $'000 $'000 $'000
1 January 2024 90,805,237 908 92 90,528 91,528
30 June 2024 90,805,237 908 92 90,528 91,528
As at 30 June 2024, the Company's authorised and issued share capital
comprises 90,805,237 Ordinary Shares at $0.01 per share and 1 E Share at $1
per share.
9. Audit fees
For the six months ended For the six months ended
30 June 2025
30 June 2024
$'000 $'000
Fees to the Company's Auditor
for audit of the statutory financial statements 163 141
for other audit related services 34 15
197 156
Other fees paid to the Company's Auditor for other audit related services of
$197k (30 June 2024: $156k) were in relation to the review of the Interim
Report.
The fees payable to the Company's Auditor include estimated accruals
proportioned across the period for the audit of the statutory financial
statements and the fees for other audit related services were in relation to a
review of the Interim Report. There were $nil fees paid for other non-audit
services in the period (30 June 2024: $nil).
10. Profit Share
Under the Investment Management Agreement, the Investment Manager will not
charge any base or other ongoing management fees, but will be entitled to
reimbursement of reasonable expenses incurred by it in the performance of its
duties.
The Investment Manager will receive from the Company, a Profit Share based on
the Company's income, as calculated for UK tax purposes and the Company's
Capital Account.
The Profit Share will be payable quarterly at the same time as the Company
pays its distributions, subject to an annual reconciliation in the last
quarter of each year, as disclosed in the Company's Annual Report for the year
ended 31 December 2024.
Amounts expensed as Profit Share during the year was $50k (2024: nil).
11. Tax
As an investment trust, the Company is exempt from UK corporation tax on
capital gains arising on the disposal of shares. Capital profits from its loan
relationships are exempt from UK tax where the profits are accounted for
through the Capital column of the Statement of Comprehensive Income, in
accordance with the AIC SORP.
The Company has made a streaming election to HMRC in respect of distributions
and is entitled to deduct interest distributions paid out of income profits
arising from its loan relationships in computing its UK corporation tax
liability. Therefore, no tax liability has been recognised in the financial
statements.
For the six months ended For the six months ended
30 June 2025
30 June 2024
Revenue Capital Total Revenue Capital Total
$'000 $'000 $'000 $'000 $'000 $'000
UK Corporation tax charge on profits for the year at 25% (2024: 25%) - - - -- -- --
For the six months ended For the six months ended
30 June 2025
30 June 2024
Revenue Capital Total Revenue Capital Total
$'000 $'000 $'000 $'000 $'000 $'000
Return on ordinary activities before taxation 1,624 (2,541) (917) 2,209 (1,992) 217
Profit / (loss) on ordinary activities multiplied by standard rate of 406 (635) (229) 552 (498) 54
corporation tax in the UK of 25% (2024: 25%)
Effects of:
Non-taxable investment Gains /(losses) - 635 635 - 373 373
on investments
Non-taxable dividend income (95) - (95) (72) - (72)
Tax deductible interest distributions (497) - (497) (684) - (684)
Movement in deferred tax not recognised 186 - 186 204 - 204
Non-deductible expenses - - - - 125 125
Total tax charge - - - - - -
As at 30 June 2025 the Company has excess management expenses of $6,836,949
that are available to offset future taxable revenue. A deferred tax asset of
$1,709,237, measured at the substantively enacted standard corporation tax
rate of 25% has not been recognised in respect of these expenses since the
Directors believe that there will be no taxable profits in the future against
which the deferred tax asset can be offset.
Deferred tax is not provided on capital gains and losses arising on the
revaluation or disposal of investments because the Company meets (and intends
to continue to meet for the foreseeable future) the conditions for approval as
an Investment Trust company.
Taxes are based on the UK Corporate tax rate which existed as of the balance
sheet date which was 25%. The main rate of Corporation tax is 25% for
companies with profits over £250,000.
12. Earnings per share and Net assets per share
Earnings per share
For the six months ended For the six months ended
30 June 2025
30 June 2024
Revenue Capital Total Revenue Capital Total
Profit/(loss) attributable to equity holders of the Company - $'000 1,624 (2,541) (917) 2,209 (1,992) 217
Weighted average number of Ordinary Shares in issue 67,735,138 90,805,237
Basic and diluted earnings and loss per Share from continuing operations in 2.40 (3.75) (1.35) 2.43 (2.19) 0.24
the period (cents)
There are no dilutive shares in issue.
Net assets per share
30 June 2025 31 December 2024
Net assets - $'000 44,292 62,554
Number of Ordinary Shares issued 49,066,161 68,157,036
Net assets per Share (cents) 90.27 91.78
13. Distributions declared with respect to the period
Distribution per share Total distribution
Interim distributions paid during the period ended 30 June 2025 cents $'000
With respect to the quarter ended 31 December 2024 0.72 491
With respect to the quarter ended 31 March 2025 0.08 54
0.80 545
Distribution per share Total distribution
Interim distributions declared after 30 June 2025 and not accrued in the cents $'000
period
With respect to the quarter ended 30 June 2025 1.5 735
On 13 August 2025, the Board approved a distribution of 1.5 cents per share
with respect to the quarter ended 30 June 2025. The record date for the
distribution is 22 August 2025 and the payment date is 19 September 2025.
14. Related Party Transactions
Directors
The Company has three non-executive Directors. Directors' fees for the period
ended 30 June 2025 amounted to $79k (30 June 2024: $76k), of which $nil (31
December 2024: $nil) was outstanding at period end. Amounts paid to Directors
as reimbursement of travel and other incidental expenses during the period
amounted to $4k (30 June 2024 $nil), of which $4k (31 December 2024: $nil) was
outstanding at period end.
SPVs
In 2019, the Company provided a loan to the US Corp. which accrues interest at
9.27 percent. Any interest that is unable to be repaid at each quarter end is
capitalised and added to the loan balance. Total interest in relation to the
period was $2.4m (30 June 2024: $2.7m) of which 0.7m (30 June 2024: $1.9m) was
received in cash and $1.7m remained outstanding at the period end (31 December
2024: $1.1m outstanding). The balance on the loan investment at 30 June 2024
was $31.9m (31 December 2024: $43.5m). The Company's has equity investments,
the balance of these equity investments at 30 June 2025 was $10.4m (31
December 2024: $18.1m). During the period the equity investments had a fair
value movement of $2.5m (31 December 2024: $8.6m).
During 2022, the SPVs entered into a RCF Agreement for $15.0 million with BC
Partners. The SPV borrowings from the facility at 30 June 2025 were $nil (31
December 2024: $nil), leaving the remaining $15 million (31 December 2024: $15
million) undrawn commitment for future borrowings. The guarantors are the
Company, Riverstone Credit Opportunities Income Partners - Direct L.L.C., a
Delaware limited liability company and Riverstone Credit Opportunities Income
Partners L.L.C., a Delaware limited liability company. The SPVs are required
to maintain an LTV Ratio above the Covenant LTV of 22% and the net asset value
to be at least $40 million at each borrowing request date.
The LTV Ratio is calculated as the total outstanding principal and accrued
interest on the facility divided by the Aggregate NAV. At 30 June 2025, the
SPVs were compliant with the Covenant LTV and the full amount of the undrawn
commitment is available.
The Company's other investments in its SPVs are made via equity shareholdings
as disclosed in note 4.
Investment Manager
The Investment Manager is an affiliate of Riverstone and provides advice to
the Company on the origination and completion of new investments, the
management of the portfolio and on realisations, as well as on funding
requirements, subject to Board approval. For the provision of services under
the Investment Management Agreement, the Investment Manager earns a Profit
Share, as disclosed in note 12 in the Company's Annual Report for the year
ended 31 December 2024. The Investment Manager is entitled to reimbursement of
any reasonable expenses incurred in relation to management of the Company and
amounts reimbursed during the period were $25k (31 December 2024: $180k).
Christopher Abbate and Jamie Brodsky, both portfolio managers of RCOI
transferred their shares from the Investment Manager to Breakwall Capital LP
on 1 January 2024. They purchased no new shares during 2025.
14. Subsequent events
On 1st July 2025, the RCF was terminated and a Payoff Letter executed,
releasing obligators under the Loan document and Credit agreement.
On 27 June 2025, the Company redeemed 19,090,875 Ordinary Shares by way of a
Compulsory Redemption of Ordinary Shares. The Redemption proceeds was
subsequently paid on 2 July 2025.
On 18 July 2025 the Company successfully realised its first lien green loan in
Streamline Innovations.
With the exception of the above and distributions declared and disclosed in
note 13, there are no other material subsequent events.
Glossary of Capitalised Defined Terms
Administrator means Ocorian Administration (UK) Limited
AGM means Annual General Meeting
AIC means the Association of Investment Companies
AIC Code means the AIC Code of Corporate Governance
AIC SORP means the Statement of Recommended Practice issued by the AIC in
November 2014 and updated in January 2017 for the Financial Statements of
Investment Trust Companies and Venture Capital Trusts
Annual Report means the Company's yearly report and financial statements for
the year ending 31 December 2022
APLMA means Asia Pacific Loan Market Association
Auditor means Ernst & Young LLP or EY
Board means the Directors of the Company
Borrower means entities operating in the energy sector that issue loans,
notes, bonds, and other debt instruments including convertible debt
Breakwall means Breakwall Capital LP
Company or RCOI means Riverstone Credit Opportunities Income Plc and its
underlying SPVs
Directors means the Directors of the Company
Distributable Income means the Company's income, as calculated for UK tax
purposes
DTR means the Disclosure Guidance and Transparency Rules sourcebook issued by
the Financial Conduct Authority
ESG means environmental, social and governance
E&P means exploration and production
FCA means the UK Financial Conduct Authority (or its successor bodies)
Firm or Investment Manager means Riverstone Investment Group LLC
GHG means Greenhouse gases
GREEN LOAN means to align lending and environmental objectives. It refers to
any type of loan instrument made available exclusively to finance or
re-finance, in whole or in part, new and/or existing eligible Green Projects.
Green loans must align with the four components of the Green Loan Principles.
We strive to enhance the decarbonisation impact of our credit portfolio and
advance the energy transition infrastructure
GREEN LOAN PRINCIPLES means a clear framework of the characteristics of a
Green Loan with four core components 1. Use of Proceeds, 2. Process for the
Project Evaluation and Selection, 3. Management of Proceeds and 4. Reporting.
The Green Loan principles promote the development and integrity of the Green
Loan product through leading financial institutions active in the global loan
markets. Green Loan Principles (GLP) have been developed by an experienced
working party, consisting of representatives from leading financial
institutions active in the global syndicated loan markets, with a view to
promoting the development and integrity of the Green Loan product. The GLP
comprise voluntary recommended guidelines, to be applied by market
participants on a deal-by-deal basis depending on the underlying
characteristics of the transaction, which seek to promote integrity in the
development of the Green Loan market by clarifying the instances in which a
loan may be categorised as "green"
H&W means Harland and Wolff
IAS means the international accounting standards
IFRS means the International Financial Reporting Standards, being the
principles-based accounting standards, interpretations and the framework by
that name issued by the International Accounting Standards Board, to the
extent they have been adopted by the UK
Investment Management Agreement means the Investment Management Agreement
entered between the Investment Manager and the Company
Investment Manager means Riverstone Investment Group LLC
IPEV Valuation Guidelines means the International Private Equity and Venture
Capital Valuation Guidelines
IPO means the initial public offering of shares by a private company to the
public
IRR means internal rate of return
Listing Rules means the listing rules made by the UK Listing Authority under
Section 73A of the Financial Services and Markets Act 2000
London Stock Exchange or LSE means London Stock Exchange plc
LSTA means Loan Syndications & Trading Association
LTV means loan to value ratio
Main Market means the main market of the London Stock Exchange
MAX means Max Energy Industrial Holdings US LLC
MOIC means multiple on invested capital
NAV or Net Asset Value means the value of the assets of the Company less its
liabilities as calculated in accordance with the Company's valuation policy
and expressed in US dollars
Ordinary Shares means ordinary shares of $0.01 in the capital of the Company
issued and designated as "Ordinary Shares" and having the rights, restrictions
and entitlements set out in the Company's articles of incorporation
Profit Share means the payments to which the Investment Manager is entitled in
the circumstances and as described in the notes to the financial statements
RCF or Facility means Revolving Credit Facility
RCOI mean Riverstone Credit Opportunities Income plc or the Company
RIC D means Riverstone International Credit - Direct, L.P.
Riverstone means Riverstone Holdings LLC.
Realisation Shares means realisation shares of US$0.01 in the capital of the
Company, as defined in the prospectus
Seawolf means Seawolf Water Resources
SPO means Second Party Opinion
SPV means any intermediate holding or investing entities that the Company may
establish from time to time for the purposes of efficient portfolio management
and to assist with tax planning generally and any subsidiary undertaking of
the Company from time to time
Specialist Fund Segment means the Specialist Fund Segment of the London Stock
Exchange's Main Market
Sub-Manager means Breakwall Capital LP
Sustainability-Linked Loans or SLL means a loan with the aim to facilitate and
support environmentally and socially sustainable economic activity and growth.
We seek to enhance the decarbonisation impact of our credit portfolio and
enhance the energy transition infrastructure. Sustainability-Linked Loans
follow a set of Sustainability-Linked Loan Principles (SLLP) which were
originally published in 2019 and provide a framework to Sustainability-Linked
Loan structures. In order to promote the development of this product, and
underpin its integrity, the APLMA, LMA and LSTA considered it appropriate to
produce Guidance on the SLLP, to provide market practitioners with clarity on
their application and approach
Sustainability-Linked Loan Principles (SLLP) means principles originally
published in 2019 and provide a framework to Sustainability-Linked Loan
structures
Term Loan means Sustainability-Linked first lien term loan
UK or United Kingdom means the United Kingdom of Great Britain and Northern
Ireland
US or United States means the United States of America, its territories and
possessions, any state of the United States and the District of Columbia
US Corp. means Riverstone International Credit Corp.
Warrants means detachable warrants over new ordinary shares in the Company
Wind-down Investment policy means the Company's investment policy is to
realise the Company's assets on a timely basis with the goal of making returns
of cash to holders of Ordinary Shares as soon as possible.
Directors and General Information
Directors
Reuben Jeffery, III (Chairman) (appointed 2 April 2019)
Emma Davies (Audit and Risk Committee Chair) (appointed 2 April 2019)
Edward Cumming-Bruce (Nomination Committee Chair) (appointed 2 April 2019)
all independent and of the registered office below
Registered Office Website: www.riverstonecoi.com
5th Floor ISIN GB00BP0R4J21
20 Fenchurch Street Ticker RCOI.LSE
London Sedol BP0R4J2
EC3M 3BY Registered Company Number 11874946
Investment Manager Registrar
Riverstone Investment Group LLC Link Asset Services
c/o The Corporation Trust Company The Registry
Corporation Trust Center Central Square
1209 Orange Street 29 Wellington Street
Wilmington Leeds
Delaware 19801 LS1 4DL
Company Secretary and Administrator Sole Bookrunner
Ocorian Administration (UK) Limited J.P. Morgan Securities plc
5th Floor 25 Bank Street
20 Fenchurch Street Canary Wharf
London London
EC3M 3BY E14 5JP
Independent Auditor Receiving Agent
Ernst & Young LLP Link Asset Services
25 Churchill Place Corporate Actions
London The Registry
E14 5EY Central Square
29 Wellington Street
Legal Adviser to the Company Leeds
Hogan Lovells LLP LS1 4DL
Atlantic House
50 Holborn Viaduct Principal Banker and Custodian
J.P. Morgan Chase Bank, N.A.
Sub-investment Manager 270 Park Avenue
Breakwall Capital LP New York
174 Bellevue Avenue, Suite 200-A NY 10017-2014
Newport, RI 02840
Cautionary Statement
The Chairman's Statement and Investment Manager's Report have been prepared
solely to provide additional information for Shareholders to assess the
Company's strategies and the potential for those strategies to succeed. These
should not be relied on by any other party or for any other purpose.
The Chairman's Statement and Investment Manager's Report may include
statements that are, or may be deemed to be, "forward-looking statements".
These forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "believes", "estimates",
"anticipates", "expects", "intends", "may", "will" or "should" or, in each
case, their negative or other variations or comparable terminology.
These forward-looking statements include all matters that are not historical
facts. They appear in a number of places throughout this document and include
statements regarding the intentions, beliefs or current expectations of the
Directors and the Investment Manager, concerning, amongst other things, the
investment objectives and investment policy, financing strategies, investment
performance, results of operations, financial condition, liquidity, prospects,
and distribution policy of the Company and the markets in which it invests.
By their nature, forward-looking statements involve risks and uncertainties
because they relate to events and depend on circumstances that may or may not
occur in the future. Forward-looking statements are not guarantees of future
performance.
The Company's actual investment performance, results of operations, financial
condition, liquidity, distribution policy and the development of its financing
strategies may differ materially from the impression created by the
forward-looking statements contained in this document.
Subject to their legal and regulatory obligations, the Directors and the
Investment Manager expressly disclaim any obligations to update or revise any
forward-looking statement contained herein to reflect any change in
expectations with regard thereto or any change in events, conditions or
circumstances on which any statement is based.
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