REG - Sequoia Econ Infra - NAV and Investment Update

Sequoia Economic Infrastructure Income FundAnnouncement

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RNS Number : 8228A  Sequoia Economic Infra Inc Fd Ld  17 April 2026

NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN WHOLE OR IN PART IN OR INTO
THE UNITED STATES

 

Sequoia Economic Infrastructure Income Fund Limited ("SEQI" or the "Company")

 

 

MONTHLY FACTSHEET & COMMENTARY - March 2026

 

The NAV per share for SEQI, the largest LSE listed infrastructure debt fund,
decreased to 93.17 pence per share from the prior month's NAV per share of
93.65 pence, representing a decrease of 0.48 pence per share.

                                        pence per share
 28 February 2026 NAV                             93.65
 Interest income, net of expenses                  0.61
 Asset valuations, net of FX movements            -1.16
 Share buybacks                                    0.07
 31 March 2026 NAV                                93.17

 

The decline in asset valuations is primarily attributable to unrealised
mark-to-market impacts from higher interest rates, rather than underlying
credit performance. The portfolio's pull to par increased from 3.5 pence per
share during February to 4.5 pence per share during March.

 

No expected material FX gains or losses are reflected in the NAV as the
portfolio is approximately 100% currency-hedged. However, the Company's NAV
may include short-term unrealised FX gains or losses, arising from differences
in the valuation methodologies between FX hedges and the underlying
investments. These FX-related fluctuations will typically reverse over time.

 

Key Performance Highlights - March 2026

 

Dividend yield of 8.98%, based on the closing share price of 76.60 pence as at
31 March and the annual dividend target of 6.875 pence per share (share price
as at 16 April 80.9p).

 

Weighted average portfolio yield-to-maturity was 9.62% as at 31 March,
reflecting the portfolio's strong income returns.

 

The portfolio pull-to-par 1  (#_ftn1) (which is incremental to NAV as loans
mature over time) was 4.5 pence per share as at 31 March.

 

The NAV total return was 8.37% for the financial year ended 31 March 2026.

 

 

Market Summary - March 2026

 

Relevant Interest Rate Announcements and Inflation Outlook

 

 ·             Sovereign bond markets were volatile during March, reflecting heightened
               Middle East tensions and a broader fixed income sell-off. Yields rose across
               key regions, with U.S. 10-year Treasuries at 4.3%, U.K. 10-year swap rates at
               4.9%, and German Bund yields increasing to 3.0% from 2.6%, contributing to
               negative valuation movements, particularly for fixed-rate assets.

 ·             Central banks in the U.S., U.K., and Eurozone have broadly held policy rates
               steady. While underlying inflation has moderated, geopolitical developments,
               particularly in energy markets, have added upward pressure to inflation
               expectations and complicated the outlook for monetary easing.

 ·             Markets remain highly sensitive to developments in the Middle East. A
               temporary U.S., Iran ceasefire in early April briefly eased oil prices and
               bond yields, but subsequent escalation has contributed to ongoing volatility.

 ·             As a result, the timing and pace of rate cuts remain uncertain, with
               geopolitical risks likely to delay easing despite improving inflation trends
               in some regions.

 ·             In this environment, SEQI benefits from its dynamic interest rate positioning,
               with 58.5% of the portfolio in fixed-rate investments as at end March 2026.

 ·             The outlook for inflation, interest rates and financial markets remains
               closely linked to geopolitical developments, with prolonged instability likely
               to keep yields elevated, while de-escalation would support lower yields and
               improved market stability.

 

Tariff Impact & Geopolitical Analysis

 

 ·             Ongoing U.S., Iran hostilities, including proposed U.S. tariffs on countries
               trading with Iran, have increased geopolitical uncertainty and driven
               volatility in energy markets, reinforcing inflation risks.

 ·             The direct impact on SEQI's portfolio remains limited, with low short-term
               sensitivity to energy prices. The Investment Adviser continues however to
               assess potential downstream impact on borrowers, and Seqi benefits from 63.5%
               of the portfolio being comprised of senior loans as at March 2026, reflecting
               the Company's defensive positioning.

 ·             Market dislocation and potential credit spread widening may create
               opportunities for new lending at attractive risk-adjusted returns, subject to
               geopolitical developments.

 

Portfolio Update - March 2026

 

 

Revolving Credit Facility and Cash Holdings

 

 ·             As of March, the Company was net undrawn on its £300 million revolving credit
               facility and held cash of £48.5 million (inclusive of interest income). The
               Company also had net undrawn investment commitments of £80.2 million, with
               new investments and drawdowns scheduled in the near-term.

 

Portfolio Composition

 

 ·             The Company's invested portfolio consisted of 48 private debt investments and
               2 infrastructure bonds, diversified across 8 sectors and 27 sub-sectors.

 ·             The weighted average loan life was 3.4 years.

 ·             Private debt investments which allow the Company to capture illiquidity yield
               premiums, represented 94.1% of the total portfolio.

 ·             The Company's portfolio remained geographically diversified, with 43.4% of
               investments located in the U.S, 22.9% in the UK and 33.7% in Europe.

 

 

Diversified Portfolio

 

 

 

Portfolio by Sector

 

 

 

 

Share Buybacks - March 2026

 

 ·             The Company bought back 7,748,174 of its ordinary shares at an average
               purchase price of 80.23 pence per share during March 2026.

 ·             The Company first started buying back shares in July 2022 and since then has
               spent £232.3 million buying back 288,507,083 ordinary shares by the end of
               March 2026, representing approximately 19% of the shares in issue as at
               month-end.

 ·             This share buyback programme by the Company continues to contribute positively
               to NAV accretion, generating 2.49 pence per share since the start of the
               programme in July 2022.

 ·             The Board applies a dynamic approach to share buybacks which takes into
               account available portfolio liquidity, the relative discount to NAV and other
               relevant factors. The share buyback programme will continue to remain in
               place.

 

New Investment Activity - March 2026 2  (#_ftn2)

 

 ·             A bridge facility extension and upsize of a loan to Grange Backup Power Ltd
               Facility B, a leading UK provider of infrastructure power standby generation.
               As part of the transaction, SEQI rolled its existing exposure into the new
               loan, with a total commitment of €75 million, of which €60.4 million had
               settled as at the March month-end. The yield to maturity on this loan is
               9.09%.
 ·             Additional purchase of Navigator 7.25% - 10/2029 bonds for $14.4 million.
               Navigator Holdings Ltd is a US-based owner and operator of liquefied gas
               carriers. The business is globally diversified and has limited exposure to the
               Strait of Hormuz. The company's performance remains in line with expectations,
               and the bond is currently marked above par. The yield to maturity on this bond
               is 7.07%.
 ·             Additional senior loan for £6.9 million to Community Fibre, a U.K.-based
               full-fibre-to-the-premises (FTTP) broadband provider. The yield-to-maturity on
               this loan is 8.01%.
 ·             Additional senior loan for €5.1 million to Project Crystal, a leading
               provider of diagnostic imaging and radiotherapy services through an extensive
               network of clinics across Germany. The yield-to-maturity is approximately
               6.65%.
 ·             A top-up of €1.5 million to the existing senior loan to Muehlhan Holding
               GmbH. The borrower is an established global industrial services provider with
               operations across the renewables, infrastructure, marine, industrial and
               construction sectors. The loan has a yield-to-maturity of 7.32%.
 ·             An additional senior secured loan of €0.6 million to finance the
               construction of a portfolio of ready-to-build Solar P.V. plants in Poland. The
               loan is projected to deliver a yield-to-maturity of approximately 8.74%.

Investments that Repaid During March 2026

 ·             Non-cash repayment of the original Grange Backup Power Ltd loan, associated
               with its extension and upsize as disclosed in the new investment activity
               section. The repayment is accounted for as a full rollover on the loan book.

 ·             Proceeds of $17.9 million were received from the sale of an equity position in
               Salt Creek EPIC, representing a minority stake in a separate asset to Salt
               Creek Aggregator Holdco LLC. The position has now been substantially settled,
               with approximately $210k withheld for tax provisions.  SEQI has three
               remaining Salt Creek positions (aggregated within the Top 10 Borrowers by
               Exposure table) totalling £55.8 million. The borrower continues to perform
               ahead of budget.

 

Non-performing Loans - March 2026

 

 ·             The Company continues to work towards maximising recovery from the remaining
               non-performing loans in the portfolio (amounting to 0.3% of NAV).

 ·             Shortly after month end, the Company sold its entire position in SL 4000
               Connecticut LLC at a small premium to book value.

 

Top Holdings - March 2026

 

 

 

Valuations are independently reviewed each month by PwC.

http://www.rns-pdf.londonstockexchange.com/rns/8228A_1-2026-4-16.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/8228A_1-2026-4-16.pdf)

http://www.rns-pdf.londonstockexchange.com/rns/8228A_2-2026-4-16.pdf
(http://www.rns-pdf.londonstockexchange.com/rns/8228A_2-2026-4-16.pdf)

 

 

About Sequoia Economic Infrastructure Income Fund Limited

 

 ·             SEQI is the U.K.'s largest listed debt investor, investing in economic
               infrastructure private loans and bonds across a range of industries in stable,
               low-risk jurisdictions, creating equity-like returns with the protections of
               debt.
 ·             SEQI's loans are high quality and have robust covenants. SEQI lends to
               companies that have a track record of consistent cash flow generation and
               which are backed by physical assets. This enables SEQI to benefit from
               exposure to an asset class with robust fundamentals as well as the opportunity
               for attractive returns.
 ·             It seeks to provide investors with regular, sustained, long-term income with
               opportunity for NAV upside from its well diversified portfolio. Investments
               are typically non-cyclical, in industries that provide essential public
               services or in evolving sectors such as energy transition, digitalisation or
               healthcare.
 ·             Since its launch in 2015, SEQI has provided investors with eleven years of
               quarterly income, consistently meeting its annual dividend per share target,
               which has grown from five pence in 2015 to 6.875 pence per share.
 ·             The fund has a comprehensive sustainability framework, combining
               sustainability goals, a proprietary ESG scoring methodology, alongside
               processes and metrics with alignment to key global initiatives.
 ·             SEQI is advised by SIMCo, a long-standing investment advisory team with
               extensive infrastructure debt origination, analysis, structuring and execution
               experience.
 ·             SEQI's monthly updates are available here: seqi.fund/investors/monthly-updates
               (https://www.seqi.fund/investors/monthly-updates/)

 

 

For further information please contact:

 

 Investment Adviser                                    +44 (0)20 7079 0480

 Sequoia Investment Management Company Limited         pm@simcofunds.com (mailto:pm@simcofunds.com)

 Steve Cook

 Dolf Kohnhorst

 Randall Sandstrom

 Anurag Gupta

 Matt Dimond

 Joint Corporate Brokers and Financial Advisers        +44 (0)20 7029 8000

 Jefferies International Limited

 Gaudi Le Roux

 Harry Randall

 J.P. Morgan Cazenove                                  +44 (0)20 7742 4000

 Rupert Budge

 William Simmonds

 Public Relations                                      +44 (0)20 7260 2700

 Teneo (Financial PR)                                  sequoia@teneo.com (mailto:sequoia@teneo.com)

 Rob Yates

 Jessica Pine

 Alternative Investment Fund Manager (AIFM)            +44 (0) (tel:+44%2020%203530%203626) 20 3530 3600

 FundRock Management Company (Guernsey) Limited

 Ben Snook
+44 (0) (tel:+44%2020%203530%203626) 20 3530 3600

 Chris Hickling

+44 (0) (tel:+44%2020%203530%203626) 20 3530 3600

sequoia-aifm@fundrock.com (mailto:sequoia-aifm@fundrock.com)
 Administrator / Company Secretary                     +44 (0)20 7592 0419

 Apex Fund and Corporate Services (Guernsey) Limited   admin.sequoia@apexgroup.com (mailto:admin.sequoia@apexgroup.com)

 Aoife Bennett

 +44 (0) (tel:+44%2020%203530%203626) 20 3530 3600

sequoia-aifm@fundrock.com (mailto:sequoia-aifm@fundrock.com)

 

 

Administrator / Company Secretary

Apex Fund and Corporate Services (Guernsey) Limited

Aoife Bennett

 

+44 (0)20 7592 0419

admin.sequoia@apexgroup.com (mailto:admin.sequoia@apexgroup.com)

 

 

This announcement is not for publication or distribution, directly or
indirectly, in or into the United States of America. This announcement is not
an offer of securities for sale into the United States.  The securities
referred to herein have not been and will not be registered under
the U.S. Securities Act of 1933, as amended, and may not be offered or sold
in the United States, except pursuant to an applicable exemption from
registration.  No public offering of securities is being made in the United
States.

 1  (#_ftnref1) The pull-to-par includes the mark-to-market of the Fund's
interest rate swaps, capturing the valuation impact of hedging floating rate
assets into fixed rate exposure.

 2  (#_ftnref2) For non-Sterling assets hedged into Sterling, prevailing
interest rate differentials may provide a positive uplift to the
Sterling-equivalent yield.

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