(Alliance News) - John Laing Group PLC on Wednesday said it expects a single-digit net asset value decline during a busy six months for the infrastructure project investor which was hurt by the Covid-19 pandemic.
Shares in the company were 8.9% lower at 317.40 pence each in London on Wednesday morning.
John Laing expects net assets at June 30, before deducting dividends, to have fallen. Its NAV per share at December 31 was 337p and stood at 325p at the end of June 2019.
Its first half NAV per share will take a 20p hit from "external factors, namely Covid-19". John Laing explained it has also increased discount rates at a number of assets, hurting NAV per share by 12p.
Foreign exchange, however, specifically sterling weakening against the US and Australian dollars, has provided a 12p tailwind to its NAV per share.
"External factors, including the exceptional impact of Covid-19 and reductions in power price forecasts, have more than offset the underlying portfolio performance and gains from foreign exchange," the investor said.
The pandemic has led to reduced power demand and tumbling energy prices.
The FTSE 250 firm added: "One of the main ways that Covid-19 has impacted the valuation of our portfolio is through changes in macro-economic assumptions, particularly lower short-term expectations for inflation.
"As a result of the pandemic, demand for electricity has fallen and the power price forecasts received during the period show material reductions both in the short and in the long term. Off-take arrangements, in place for most of our renewable assets, have provided some protection against short-term volatility. However, we expect a negative impact from lower power prices across all regions."
During the period it also completed the sale of five assets, pocketing GBP90 million as a result.
It plans to report on its first half results in August.
By Eric Cunha; ericcunha@alliancenews.com
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