SQN.L Regulatory News (SQN)

21 August 2018

SQN Asset Finance Income Fund Limited

Monthly Net Asset Value and Dividend

Net Asset Value

SQN Asset Finance Income Fund Limited (the "Company"), the leading diversified equipment leasing fund listed in the UK, is pleased to provide its monthly net asset value ("NAV") update.

As at 31 July 2018, the unaudited estimated NAV per ordinary share was 97.35 pence (see below)*.

As at 31 July 2018, the unaudited estimated NAV per C share was 97.59 pence (see below)*. 

Dividends

The Company is pleased to announce a dividend of 0.6042 pence per ordinary share for the month ended 31 July 2018, reflecting an annualised dividend of 7.25 pence per share. The dividend will be payable on 17 September 2018 to holders of ordinary shares on the register on 31 August 2018. The ex-dividend date is 30 August 2018.

The Company is also pleased to announce a dividend on the C Share of 0.4167 pence per C share for the month ended 31 July 2018, reflecting an annualised dividend of 5.00 pence per share  The dividend will be payable on 17 September 2018 to holders of C shares on the register on 31 August 2018. The ex-dividend date is 30 August 2018.

Based on the further deployment of capital in the C Shares, the Company is on target to pay a full dividend, at an annualised rate of 7.25%, on the C Shares for the month ending 31 August 2018.

IFRS 9 Update

The Company has formally adopted IFRS 9 from 1 July 2018 and is publishing the July 2018 NAV under this new accounting standard.

The implementation of IFRS 9 decreases the Company's NAV by approximately 40 bps in respect of the Ordinary Shares in addition to the 69 bps impairment in respect of Suniva taken under IAS 39 in June 2018.

In respect of the C Shares, the decrease in the Company's NAV, due to IFRS 9, is approximately 3 bps.

Given that the adjustment to the NAV is purely driven by a revised accounting methodology, it will have no impact on the Company's future cash flows. The Board, therefore, expects the Company to continue to pay a dividend of 7.25 pence per annum on both its Ordinary and 'C' Shares going forward.

A short explanatory note with additional information about IFRS 9 is being made available on the Company's website www.sqncapital.com/managed-funds/sqn-asset-finance-income-fund.

*NAV Footnote

The Ordinary Share NAV includes an adjustment of 40 bps in respect of the Company adopting IFRS 9 with effect from 1st July 2018. This is also net of the 0.6042 pence per ordinary share dividend announced on 23 July 2018 that went ex-dividend on 2 August 2018 and was paid on 16 August 2018.

The C Share NAV includes an adjustment of 3 bps in respect of the Company adopting IFRS 9 with effect from 1st July 2018. This is also net of the 0.3333 pence per C share dividend announced on 23 July 2018 that went ex-dividend on 2 August 2018 and was paid on 16 August 2018.

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Notes to Editor

The Company invests in equipment lease and asset finance arrangements across a diverse portfolio of assets and industries predominantly in the UK, Northern Europe and US. The Company focuses on business-essential, revenue-producing (or cost saving) equipment and other assets with high in-place value and long economic life relative to the investment term.

The Company's Investment Managers are SQN Capital Management, LLC, a Registered Investment Advisor with the United States Securities and Exchange Commission and its subsidiary, SQN Capital Management (UK) Limited. The principals responsible for managing the portfolio are Neil Roberts and Jeremiah Silkowski.