(Alliance News) - Sequoia Economic Infrastructure Income Fund Ltd on Tuesday edged its dividend payout upwards as its net asset value rose in its recent financial year on a recovery in financial markets and credit spreads returning to normal levels.
As at March 31, the FTSE 250 infrastructure debt investor had a NAV of 103.18 pence per share, up 6.7% from 96.69p a year before. For the recent financial year, Sequoia posted an NAV total return of 13.5%, well above the company's target return.
Interest income from investments added 8.27p to Sequoia's NAV per share, while positive market movements added 6.09p. Operating costs took out 1.11p.
Throughout the year, the fund benefited from significant mark-ups in asset valuations, with several investments within the portfolio performing better than expected despite the various Covid-19 restrictions imposed across the world.
Sequoia's investment portfolio contains 72 investments across eight sectors. The fund declared a dividend of 6.25 pence per share, up 1.0% from 6.19p the year before.
"SEQI has demonstrated the considerable resilience of its portfolio and the wider infrastructure asset class throughout the Covid-19 related challenges of the past year. In an environment of necessarily accommodative fiscal and monetary policies, our in-year return performance was well in excess of our long-term targets," said Chair Robert Jennings.
"As economic conditions continue to improve, we are well placed to invest selectively in our extensive pipeline of potential infrastructure loans, which have attractive yields, appropriate credit quality and build on our continued progress with our overall ESG score. We believe that the company continues to be well placed to deliver attractive risk-adjusted returns in a sustainable manner over the long term."
Shares in Sequoia Economic Infrastructure Income were down 0.3% at 111.29 pence on Tuesday in London.
By Dayo Laniyan; dayolaniyan@alliancenews.com
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Sequoia Economic Infrastructure Fund (SEQI)