Hicl Infrastructure Share Discussion Threads

[jonwig] 18/11/2015 07:42

Still a very firm hold.
It's pleasant when an investment needs only infrequent monitoring.

Hubris? Hope not ...

[skinny] 18/11/2015 07:10

Interim Highlights

For the six months ended 30 September 2015



· Net asset value ("NAV") per share (as at 30 September 2015) of 139.1p; up 2.4p (1.8%) from the NAV per share of 136.7p at 31 March 2015.

· Total shareholder return for the period of 9.0% (annualised), based on interim dividends declared plus uplift in NAV per share in the six month period.

· Aggregate quarterly dividends declared for the first half of 3.72p per share (2014: 3.62p); on track to achieve the Company's aggregate dividend target of 7.45p per share for the full year1.

· Target dividend guidance for the financial year to 31 March 2017 of 7.60p per share1.

· Value of the Group's investment portfolio up 8.1% in the six months, based on a 30 September 2015 valuation of £1,872.1m2 (31 March 2015: £1,732.2m2).

· Weighted average discount rate reduced from 7.9% to 7.7% over the six month period, reflecting projects reaching construction completion and ongoing, strong demand for similar infrastructure investments.

· Two new investments and two incremental stakes acquired during the period for £130.7m funded by £91.2m equity tap issue in July and drawings under the Group's revolving credit facility.

· Current net funding requirement of approximately £30m - Board considering a tap issue in the near future.

· Since the period end, the Group has increased its revolving credit facility from £150m to £200m on improved terms, including a reduction in the margin.

[skinny] 12/10/2015 08:49

Notice of Interim Results for six months ended 30 September 2015

HICL Infrastructure Company Limited, the listed infrastructure investment company advised by InfraRed Capital Partners Limited, intends to announce its interim results for the six months ended 30 September 2015 on Wednesday 18 November 2015.

There will be a meeting for analysts at 9.30am on 18 November 2015 at the offices of the company's broker, Canaccord Genuity Limited, 88 Wood Street, London EC2V 7QR.

[jonwig] 30/7/2015 07:21

The plan was to issue up to 32m new shares raising £48m gross (ie. 150p/sh).

Today they announce an issue of 60m shares at 152p ... HICL is still a very much in demand stock!

[jonwig] 28/7/2015 18:53

If rising interest rates are accompanied by inflation, infrastructure has some indexing built into their income.

So fixed rate bonds have some disadvantage, but maybe infrastructure has some lurking political risk?

[beltd] 28/7/2015 15:21

Would you prefer bonds or infrastructure in a rising interest rate environment?

[jonwig] 27/7/2015 07:59

Tap issue of up to 32m new shares at, by implication, about 150p. They're using a bookbuild so institutional demand will determine the price.

Since current share total is 1,270m and NAV was 130p last time (it will be more now) that's small beer.

However, I know that at least two brokers (Brewin Dolphin, Chas Stanley) are cooling on HICL for their discretionary management, viewing the premium to NAV as excessive.

[jonwig] 24/7/2015 07:57

So the forecast dividend of 7.45% means a yield of 4.9%.

What happens if/when interest rates rise early next year? Market will want a higher yield (over 5%?) and discount rate will rise a bit, suppressing the NAV.
Plus they're issuing regularly 10% of their share capital each year before they even offer shares to Joe Public. But then the "true" NAV based on disposals is a lot higher than the calculated one.

A "hold" for me, but no more.

[ganthorpe] 07/7/2015 08:36

Yes my first thought on seeing the Southmead Hospital announcement was the likelihood of another fundraising. It will have to be at a decent discount to the present share price and will bring down the premium and the share price. Not sure that I will throw any more cash at HICL.
GAN

[jonwig] 07/7/2015 07:14

Aquisition of Southmead hospital project from Carillion:



Interesting thing is that this is partly a completed and operational project, and partly under construction (being extended).

They add that current net funding requirement for HICL is £47m. Since they last had a fundraising in June 2014, can we expect another? (It won't involve pre-emption rights.) On the other hand, chartists might not like the look of the share price chart at the moment!

[madengland] 29/6/2015 21:49

Hmm looking for more of these, a lovely diversification with interest rates low and the equity bear waking

[madengland] 26/6/2015 18:39

More projects should enable these guys to cherry pick for solid less risky, good yields and returns.....With their sleek silhouettes and bright, roomy interiors, 115 new Class 700 Thameslink trains will begin service through Central London next year. Faster, lighter and more energy-efficient than the rolling stock they replace, these eight-car and 12-car electric trains will double capacity on one of Europe's busiest stretches of railway. Their much-anticipated arrival is part of a £6 billion upgrade program for Thameslink.Urbanizing at a steady pace, the world needs better transit, larger airports, new water sources and infrastructure upgrades in general. In a complementary way, the world of capital and investing needs stable, inflation-protected debt instruments by which to generate reliable returns. Governments can go it alone on major infrastructure projects, appropriating tax revenues or issuing bonds, and many of them do. But with that process, they forego notable benefits that can be provided by large commercial banks and investors with a long pedigree in infrastructure finance and specialists dedicated to this activity."With the right sort of institutions involved, you should get added discipline and ongoing access to new capital," explains Michael Dinham, Head of Infrastructure Finance in Europe for ING. When the Cross London Trains consortium sought financing for its Thameslink trains, Dinham's unit at ING came in as one of the lead financiers on the project. ING was meanwhile supporting a £1 billion refinancing of Budapest Airport, which in 2014 passed the 9 million-mark in passenger traffic; financing a major upgrade of the Netherlands' A9 motorway, including one section of tunnel that will be covered by a new public park; and financing a gas distribution network in Germany and new port facilities in the Port of Antwerp.The taxpaying public is generally wary of sprawling construction projects before they break ground, but usually pleased and perhaps even proud when they're finished and opened. No two projects are alike, and in every case the decision to use commercial lending bears scrutiny. The ING philosophy, in Dinham's words, favors "having an intelligent debate" as to whether privatization or other forms of public-private collaboration might yield optimal outcomes."What you hope to achieve with increased private sector involvement in major public projects is an allocation of risk between parties involved, which leads to tighter performance standards and timelines, thorough long term cash-flow analysis, greater scrutiny over costs and other safeguards against problems," says Dinham. He brings up the example of Heathrow Airport, which was privatised 20 years ago and where ING has been a longstanding lender. This business, which is critical to the UK economy, has invested nearly $20 billion in new terminals and other works without relying on taxpayers-it is all privately financed by banks and bondholders, but within a tight and bespoke contractual framework that involves very close lender scrutiny. As bankers, we are supportive and we're backing the effort, but there is still strict oversight."To excel in this financial sector requires long experience and well-established relationships. (You know you're cut out for it when the engineering report for a new wastewater treatment plant proves to be riveting reading.) Recently honored with a pair of best-in-class awards from banking-industry publications, the ING Infrastructure Finance group has shown it can use its deep expertise and market familiarity to expedite agreements. "A client was recently bidding on a major new greenfield project and needed a commitment of funds in a tight timeframe," says Dinham. "We were able to study the deal and approve it in a few weeks. We are part of a community of specialist financiers that live and breathe this type of financing, so there isn't a steep learning curve."In Europe and elsewhere, the flow of new projects depends to some degree on which way political winds are blowing. Yet even when activity slows, considerations beyond what is lucrative affect where ING and its peer institutions do business. In ING's case, the bank is a signatory to the Equator Principles-one of 80 financiers in several dozen countries to embrace the rigorous EP policies protecting against harm to human populations and the environment. "In the name of expediency, some governments in emerging economies won't think enough about the environmental and social impact of new infrastructure projects," Dinham says. As it happens, ING has "recently had to step away from some large-scale projects" in such scenarios.Even when socially responsible practices are certain to be observed, a major public-works initiative has to make sense fiscally over the long term in order for ING Infrastructure lenders to step forward. "The motivation to involve commercial banks and institutions has to arise from long-horizon planning and a careful analysis of the benefits," asserts Dinham. In cases where politicians are seeking to add new facilities with an eye to the next election cycle and nothing else, his team is very cautious. "If buy-now, pay-later is your only motivation for mobilizing private finance," says Dinham, "it's not enough."Record levels of ready capital throughout the global economy, along with the post-2008 tendency for governments to put off major public works projects, suggest a strong period for infrastructure-building ahead, as pent-up demand is fulfilled. The paucity of income-producing debt instruments in which savers can invest further encourages such activity. One of the genuine benefits to society is the ability of large public pension funds to rely on steady returns from bonded infrastructure projects. "Infrastructure offers relatively predictable inflation-linked returns," Dinham notes. "As a result, we have seen a high flow of capital toward deals, with infrastructure becoming established as an asset class in its own right."Demographic studies tell us that two-thirds of the world's citizens will live in cities by 2050, and this addition of 2.5 billion people to urban populations promises to place an even greater burden on infrastructure. Best practices-and best partnerships-in this vital area of human activity are counted on to create the built environment societies will need.

[madengland] 26/6/2015 10:18

Seems like a solid entry point to a solid fund, and if you don't fancy bonds anymore, a great alternative. There will be plenty of decent infrastructure projects to come I suspect

[jonwig] 22/5/2015 07:03

Results presentation - good detail:

[skinny] 21/5/2015 07:30

Nothing wrong with being cynical when it comes to investing!

[jonwig] 21/5/2015 07:17

No signs of a flattening-off, then!

At last night's close, the premium to latest reported NAV has narrowed to under 14%. If it reverts to more like 20%, that suggests the share price could rise back to 165p.

And dividend expectations raised to 7.45p: a yield of 4.8%. (Cynical of me to suggest that they set expectations at a level they knew would be beaten!)

[skinny] 21/5/2015 07:02

Highlights

§ A strong set of results, driven by good operational performance of the portfolio

§ Profit before tax was £231.0m (2014: £153.8m), up 50.2%

§ Total shareholder return of 15.4% and 22.5% in the year (on a NAV and share price basis, respectively)

§ Four quarterly interim dividends declared totalling 7.30p per share, exceeding the stated target by 0.05p per share, a 2.8% increase on the prior year

§ New guidance of a target dividend per share of 7.45p for the year to March 2016 (up from the previously published guidance of 7.40p)

§ Directors' valuation of the portfolio of £1,732.2m1, up from £1,500.6m1 at 31 March 2014 and £1,639.1m at 30 September 2014, with the weighted average discount rate reduced from 8.2% to 7.9% over the year

§ NAV per share as at 31 March 2015 of 136.7p, a 10.0p increase from 126.7p as at 31 March 2014
§ Net investment of £113.1m during the year, comprising nine new investments and 10 incremental acquisitions for £221.4m and one disposal for net consideration of £108.3m

§ A further two investments and a disposal made since the period end for a net investment of £8.7m

§ Current net funding requirement of £8m

§ Demand for infrastructure investments continues to exceed supply in the Company's target sectors, impacting prices and valuations

§ A pipeline of new investment opportunities, both in the UK and overseas, expected to deliver further value accretion

[jonwig] 16/5/2015 08:48

New infrastructure ETF which might be worth following.
Thread here:



The EPIC is "GIN" which might be the most interesting thing about it!

[yam114] 14/5/2015 11:39

Sounds good

[skinny] 14/5/2015 11:08

HICL Infrastructure Company Limited (the "Company") is pleased to announce a fourth quarterly interim dividend for the financial year ending 31 March 2015 of 1.87 pence per ordinary share (the "Q4 Dividend"). The shares will go ex-dividend on 28 May 2015 and the Q4 Dividend will be paid on 30 June 2015 to shareholders on the register as at the close of business on 29 May 2015.

The interim dividend of 1.87 pence per share equates to an aggregate of 7.30 pence per share for the year ending 31 March 2015, ahead of the Board's target of 7.25 pence per share, a reflection of the Company's strong performance. The Company is announcing its annual results on Thursday 21 May 2015.

[madengland] 23/4/2015 10:00

Fingers crossed Labour don't get in and start screwing everything up

[jonwig] 23/4/2015 07:25

9% above internal valuation. When they can't sell stuff at a premium is the time to reconsider these funds as an investment.

Incidentally, Labour's plans for infrastructure:



But what plans will it have to control profitability of existing PPI/PFI projects?

[skinny] 23/4/2015 07:03

HICL Infrastructure Company Limited, the listed infrastructure investment company advised by InfraRed Capital Partners Limited, announces that the Group has sold its entire 50% equity and subordinated debt interest and 100% junior loan interest in Fife Schools PFI project ("Fife") to a subsidiary of the PPP Equity PIP limited partnership, managed by Dalmore Capital Limited.

The decision to sell the Group's investment in Fife was triggered by the same co-shareholder selling their interest in the Fife project as that in the Colchester Garrison project, announced in February 2015. As with Colchester, this disposal was undertaken by way of a competitive tender process, providing a benchmark value for the Company's interest in Fife which the Board considered to be significantly ahead of the value that could be achieved by retaining the project. The Board continues to consider and evaluate potential disposals which are in the best interests of shareholders.

The profit on disposal, after costs, is £0.6m over the Directors' valuation of £6.7m as at 30 September 2014. As a result of recent investment activity funded from the Group's revolving debt facility, and net of disposal proceeds from the present transaction, the Group has a current funding requirement of approximately £8m.