RE: Turning point?15 May 2024 17:03
NESF are still trying to sell some assets, which would help with the debt.
https://www.lse.co.uk/rns/NESF/capital-recycling-programme-m8mqcg5xxjlgxws.html
Though there seems to be no takers at the prices they want to sell at. This could change as interest rates come down a bit.
I guess it doesn't matter in the short term whether it is a buy back or a dividend increase, it all adds to share holder returns, and at least the dividend is covered. Hopefully if they sell some assets then they could do an aggressive buy back. If they are in talks, this could be why it was a dividend increase, rather than a buy back.
I think a lot of their debt is described as 'floating rate' which is off putting a little. (they are about 45% geared with debt).
...
The £70m RCF extension is now available until June 2025 and benefits from improved terms with a margin of 150bps over SONIA ("Sterling Overnight Index Average") compared with 160bps over SONIA under the earlier terms. As at 7 May 2024, the Company's total interest cost for any amount drawn under this RCF was 6.7% due to SONIA being at 5.2%.
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The new facility is available until June 2026 and provides two additional 12-month extension options at NESF's sole discretion to bring the maturity date up to June 2028. The RCF continues to benefit from attractive terms with a margin of 120bps over SONIA ("Sterling Overnight Index Average").
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The Company continues to prioritise its Capital Recycling Programme and expects to use the proceeds from the Programme to pay down existing borrowings under the Company's RCFs.
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I bought more today, as the yield is good, if rates come down and then they can sell something this will all look a lot better. I think that is the case, at least my investment case.