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Alliance News


Greencoat UK Raises Dividend And Looks For Further Wind Farm Buys

Thu, 23rd Feb 2017 08:33


LONDON (Alliance News) - Greencoat UK Wind PLC on Thursday said is continuing to watch operating UK wind farm purchases, citing the higher power prices coming through from the sterling devaluation.

The renewable infrastructure fund, which is solely invested in operating UK wind farms, said the rise in the price of gas since the UK voted to leave the EU, owing to the significant devaluation of sterling, has fed into higher current and forecast future power prices.

Since the referendum vote, inflation has also increased and, as the vast majority of Greencoat's cashflows are either directly or indirectly linked to RPI inflation, the group said this is likely to have a positive effect on its future cash generation.

At the end of June, the UK government also approved a Fifth Carbon Budget under the 2008 Climate Change act legislating for a 57% reduction in carbon emissions relative to 1990 by 2032.

As such, Greencoat said it is continuing to look at buying UK wind farms, both onshore and offshore, as the market is expected to reach GBP60.00 billion over the next few years.

During 2016, the group's net asset value per share increased to 108.60 pence per share from 104.50p per share, and the group said during the year its net generating capacity increased to 420 megawatts after it made two additional purchases.

However, its portfolio power generation was 6.0% below budget at 978.1 gigawatt hours, as the average wind speed in the UK was around 6.0% below the long-term mean. There were also lower power prices in the first three quarters of the year, though this improved in the fourth quarter.

Greencoat declared an interim dividend of 6.34 pence per share, up from 6.26p per share a year earlier, and said it plans to pay a 6.49p per share dividend for 2017.

Shares in Greencoat were up 0.3% at 118.44p on Thursday morning.

By Hannah Boland; hannahboland@alliancenews.com; @Hannaheboland

Copyright 2017 Alliance News Limited. All Rights Reserved.

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