GCP Infrastructure Investments - Key takeaways from capital markets day

GCP Infrastructure Investments (GCP) has a mature, diverse and operational portfolio of 51 UK infrastructure assets with a total asset value of £1.1bn and a net asset value (NAV) of £953m, two-thirds of which is focused on renewables, and 41% of investments by value have some form of inflation protection. The portfolio is also well-positioned to benefit from the global trends of decarbonisation, energy security and population dynamics. The fund’s January capital markets day saw the board and man

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

GCP Infrastructure – Don’t look back in anger

There is no doubt that 2023 was a challenging year for GCP and the broader infrastructure sector as a confluence of factors weighed on performance, particularly the rapid increase in interest rates. Despite this, the company was still able to generate positive NAV returns thanks to inflation linkages and contracted earnings, which helped offset the impact of rising discount rates. Disappointingly, negative sentiment continued to weigh on the company’s shares, with the discount widening to a reco

GCP Infrastructure – Don’t look back in anger

2023 was a challenging year for GCP Infrastructure Investments Limited (GCP) as rising interest rates and several other factors appeared to weigh on returns. Despite this, the company was still able to generate positive NAV returns which the advisers note was thanks mostly to inflation linkages and contracted earnings that helped offset the impact of rising discount rates. Unfortunately, negative sentiment continued to weigh on the company’s shares, with the discount widening to a record low, de

GCP Infrastructure – Merger to unlock compelling value?

GCP Infrastructure Investments (GCP) has announced a potential three-way merger between it, GCP Asset Backed Income (GABI), and RM Infrastructure Income (RMII). As we explore in this note, this has the potential to address some of the issues that may have given rise to GCP’s exceptionally wide discount. Following a period of impressive NAV growth through 2022, GCP’s half-yearly report for the six months ending 31 March 2023 and the recently published end-June NAV showed a period of consolidatio

GCP Infrastructure – Merger to unlock compelling value?

GCP Infrastructure Investments (GCP) has announced a potential three-way merger between it, GCP Asset Backed Income (GABI), and RM Infrastructure Income (RMII). As we explore in this note, the adviser believes that this has the potential to address some of the issues that may have given rise to GCP’s discount. Following a period of NAV growth through 2022, GCP’s half-yearly report for the six months ending 31 March 2023 and the recently published end-June NAV showed what looks like a period of

Hardman & Co Insight: UK interest rates and “risk-free” gilts at their peak? Infrastructure stocks struggle

The share price performances of the nine Infrastructure Investment Companies (IICs) and of the 22 Renewable Energy Infrastructure Funds (REIFs) have been dire over the past year. Undoubtedly, the sharp rise in interest rates has presented the sector with serious challenges, especially since the yield on “risk-free” 10-year gilts has risen appreciably. Furthermore, the ongoing war in Ukraine and high inflation rates, from which many IICs and REIFs are partially ‒ if not wholly ‒ protected, contin

GCP Infrastructure Investments

GCP: recycling capital helps reset the clock...

The Hardman & Co Monthly: August 2023

Feature article: UK interest rates and “risk-free” gilts at their peak? Infrastructure stocks struggle Executive summary Infrastructure/Renewable Energy Funds ► The share price performances of the nine Infrastructure Investment Companies (IICs) and of the 22 Renewable Energy Infrastructure Funds (REIFs) have been dire over the past year. Undoubtedly, the sharp rise in interest rates has presented the sector with serious challenges, especially since the yield on “risk-free” 10-year gilts has r

Hardman & Co Insight: Higher interest rates overshadow IIC/REIF prospects

Hardman & Co Research’s focus is on the nine quoted infrastructure investment companies (IICs) and on the 22 renewable energy infrastructure funds (REIFs), most of which saw their share prices fall during 2022, while the FTSE 100 rose by just 0.9%. In our Quoted UK Infrastructure and Renewable Energy – Prospects for 2023 publication, we have addressed the three key issues of recent months: higher inflation, extremely volatile power prices and rising interest rates.

GCP Infrastructure – Green is good

GCP Infrastructure (GCP) has seen an improvement in the tailwinds supporting its investment thesis, whereby the rise in UK inflation and power prices has driven a substantial, positive uplift in GCP’s NAV. This uplift has more than made up for the negative impact of the UK government’s levy on energy producers. GCP has also improved the quality of its ESG disclosures. However, GCP has moved to trade on a historically wide discount, currently 14.7%. This may be a reflection of the wider pressure

GCP Infrastructure – Green is good

GCP Infrastructure (GCP) has seen a dramatic improvement in the tailwinds supporting its investment thesis, whereby the rise in UK inflation and power prices has driven a substantial, positive uplift in GCP’s NAV. This uplift has more than made up for the negative impact of the UK government’s levy on energy producers. GCP has also made major strides in the quality of its ESG disclosures. However, GCP has moved to trade on a historically wide discount, currently 14.7%. This may be a reflection

GCP Infrastructure – Green is good

GCP Infrastructure (GCP) has seen a dramatic improvement in the tailwinds supporting its investment thesis, whereby the rise in UK inflation and power prices has driven a substantial, positive uplift in GCP’s NAV. This uplift has more than made up for the negative impact of the UK government’s levy on energy producers. GCP has also made major strides in the quality of its ESG disclosures. However, GCP has moved to trade on a historically wide discount, currently 14.7%. This may be a reflection

Economic and Political Monthly Roundup January 2023

A collation of recent insights on markets and economies taken from the comments made by chairs and investment managers of investment companies – have a read and make your own minds up. Please remember that nothing in this note is designed to encourage you to buy or sell any of the companies mentioned.

Economic and Political Monthly Roundup January 2023

A collation of recent insights on markets and economies taken from the comments made by chairs and investment managers of investment companies – have a read and make your own minds up. Please remember that nothing in this note is designed to encourage you to buy or sell any of the companies mentioned.

Morning Note – 22 April 2024

Benefits of scale set to materialise

Frenkel Topping - Resilient with strong growth potential

FY 2023 was a challenging year for Frenkel with higher interest rates encouraging clients to place money into lower margin money market funds. Despite this, sales grew +32% (supported by recurring revenue +9% and +51% in non-recurring), EBIT margins remained strong at 22% and adj. EPS grew +17% (taking into account the higher number of shares). FY 2024 has seen a solid start to transactional business and there is a strong pipeline of new FUM opportunities both of which support further growth. Wi

Bluefield Solar Income Fund – Fundamentals shine despite discount

The manger comments that, in common with the other trusts in the renewable energy sector, the last six months have continued what has been a challenging period for the Bluefield Solar Income Fund (BSIF). It adds that the trust’s ongoing fundamental performance has failed to reverse a steady slide in its share price which began back in May 2023. Despite this, it says the company has continued to deliver solid NAV growth and market-leading shareholder distributions thanks to a range of contractual

LSL Property Services (LSL LN) - Transformation & market recovery

2023 results are, as indicated in its February pre-close update, “slightly ahead of market expectations”. Current trading continues to improve, with 1Q24 underlying operating profit up yoy, “reflecting the benefits of the Group’s transformation programme completed in 2023 as well as improving market conditions.” With net cash of £35m at end 2023, the Board approved 7.4p final DPS and £7m buy back.

S&U - PBT ahead, encouraging volume trends

S&U reported FY24 PBT of £33.6m, down from £41.4m in FY23 on higher funding and regulatory costs and higher impairments in Advantage in H2. PBT was 2% ahead of our forecast as stronger revenues – up 12% to £115.4m – and better costs offset higher-than-expected impairments. Net receivables grew to a record at both Advantage and Aspen and management noted particular strength in Q4 and a good trading environment in the current year. Having absorbed a significant rise in funding cost as well as addi

Foresight Solar Fund - Termination of coverage

Edison Investment Research is terminating coverage on ABC Arbitrage (ABCA), paragon (PGN), Foresight Solar Fund (FSFL), Kendrion (KENDR), Lithium Power International (LPI), Triple Point Energy Transition (TENT), 4iG (4IG), e-therapeutics (ETX), Pharnext (ALPHA) and Shield Therapeutics (STX). Please note you should no longer rely on any previous research or estimates for this company. All forecasts should now be considered redundant. Previously published reports can still be accessed via our web

LIBERUM: PensionBee: Strong start to the new financial year

International Public Partnerships - Consistently and responsibly delivering

International Public Partnerships’ (INPP’s) FY23 results show that it continues to deliver consistent and predictable returns for investors, while delivering environmental and social benefits for the individuals and communities that are served by its assets. Despite this strong performance and a substantial need for private infrastructure funding, the macroeconomic environment has weighed on INPP’s share price, in common with the wider sector. Regardless, attractive returns are available from th

Regional REIT - Performing as expected ahead of refinancing

In a challenging market, Regional REIT’s (RGL’s) FY23 operational and financial performance was robust, in line with expectations and previous guidance. Investor focus remains on the company’s loan to value (LTV) reduction and bond refinancing plans, explored in detail in our previous note and RGL will provide an update on this in due course.

LIBERUM: NewRiver: Q4 trading update: Continued operational momentum

LIBERUM: PayPoint: On track for £100m of EBITDA in FY 26

Witan

Business as usual for WTAN’s executive team, while the board reviews investment management arrangements…

LIBERUM: Speedy Hire: Weakness in FY 24 but recovery in FY 25

Hybridan Small Cap Feast - 22 April 2024

22nd April 2024 * A corporate client of Hybridan LLP ** Arranged by type of listing and date of announcement *** Alphabetically arranged **** Potential means Intention to Float (ITF) has been announced Dish of the day Admissions: Delistings: What’s baking in the oven? ** Potential**** Initial Public Offerings: Reverse Takeovers: 16 April 2024: Electric Guitar (ELEG.L) Concurrent with its Admission to trading on AIM, Electric Guitar is proposing to acquire the entire issued share capital of 3radi