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24 May 2023 07:00
VH Global Sustainable Energy Opportunities plc
24 May 2023
Interim dividend
The Board of Directors of the Company announced an interim dividend of 1.38p per share with respect to the period from 1 January 2023 to 31 March 2023, in line with the dividend target for 2023.
Income from the portfolio has remained robust during the quarter and the dividend is 1.3x covered. The Company's operational assets benefit from over 90% contracted revenues, which means weakening of power prices has had limited impact on revenues. As further projects achieve operational status, the dividend coverage is expected to strengthen.
31 March 2023 Net Asset Value (NAV)
The NAV increased from 108.2p per share as at 31 December 2022 to 112.3p per share as at 31 March
2022, a 3.8% increase. The movements in the NAV during the quarter include:
Pence per share | |
Net Asset Value per share as at 31 December 2022 | 108.2 |
Dividend paid during the quarter | (1.38) |
Fund expenses incurred during the quarter | (0.4) |
Movement in fair value of assets | 6.0 |
Movement in foreign exchange | (0.1) |
Net Asset Value per share as at 31 March 2023 | 112.3 |
Movement in the fair value of assets
The net positive NAV movement is primarily driven by:
· During the quarter, discount rates reduced by 109 bps on average across the portfolio due to
lower risk-free rates and a drop in sector risk premia. Average discount rates for operational
assets at 31 March 2023 were 7.3% in the US, 6.6% in Australia, 9.4% for the Brazilian hydro facility and 12.1% for the Brazilian solar PV assets. The UK assets are under construction and therefore currently held at cost;
· Strong operational performance in cash generative assets, notably in the Brazilian hydro facility which has resulted in an upward revaluation;
· The Australian solar PV asset has continued its strong performance due to the persistent supply-demand energy imbalance in the country as it moves away from a predominantly coal-baseload power system towards a more intermittent renewable-based system; and
· An additional Brazilian solar site became operational during the period resulting in a change in
valuation basis from cost to fair value; 10 solar sites in Brazil are now operational.
Foreign exchange
During the quarter, GBP strengthened versus the USD and AUD but weakened against the BRL foreign exchange. A net strengthening of GBP against the portfolio currencies resulted in a marginal decrease in foreign exchange. The Company has a mandate to hedge the short-term distributions from investments from local currency to GBP.
Leverage
Total leverage of the Company is 2% of NAV, which only includes asset level leverage limited to the US terminal storage assets. The Company does not currently employ short-term leverage at the fund level. The Company's target total return of 10% is on an unlevered basis.
The factsheet will be available on the Company's website.
www.vh-gseo.com
For further information, please contact:
Edelman Smithfield (PR Adviser)
Ged Brumby + 44 (0)7540 412 301
Kanayo Agwunobi +44 (0)758 101 0560
Victory Hill Capital Partners LLP (Investment Manager)
Navin Chauhan info@victory-hill.com
Numis (Corporate Broker)
David Benda +44 (0)20 7260 1000
Matt Goss
Apex Fund and Corporate Services (UK) Limited (Company Secretary)
Limor Gonen ukfundcosec@apexgroup.com
About Victory Hill Capital Partners LLP
Victory Hill Capital Partners LLP ("Victory Hill") is authorised and regulated by the Financial Conduct authority (FRN 961570).
Victory Hill is based in London and was founded in May 2020 by an experienced team of energy financiers that have spun-out of a large established global project finance banking group. The team have an established track record built over six years while working together in their previous roles and participating in over $37.1bn in sustainable energy project transaction values, generating over 24.2 per cent. equity returns. In addition, the team has also participated in more than $200bn in transaction values across 91 conventional and renewable energy-related transactions in over 30 jurisdictions worldwide, throughout their individual careers. The average experience per individual is 22 years of relevant energy finance experience.
The Victory Hill team deploys its experience across different financial disciplines in order to assess investments holistically from multiple points of view. The firm pursues operational stability and well-designed corporate governance to generate sustainable positive returns for investors. It focuses on supporting and accelerating the Energy Transition and the attainment of the UN Sustainable Development Goals.
Victory Hill is a signatory of the United Nations Principles for Responsible Investing (UN PRI), the United Nations Global Compact (UN GC) and is a formal supporter of the Financial Stability Board's Task-Force on Climate-related Disclosures (TCFD).
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