Shares in alternative investment company 3i Infrastructure (3IN) edged up 0.5% to a three-month high of 303p after it reported a steady increase in first half net asset value and raised its full year dividend target.
For the six months to the end of September the firm’s net asset value increased by £84 million or 3.8% to 259.4p, showing the resilience of its portfolio and the lack of correlation between infrastructure assets and the stock market.
The firm is paying a 4.9p per share interim dividend in January and a similar full year dividend later next year, meaning a 6.5% increase on last year’s total pay-out.
The total shareholder return over the first half was 18.9% compared with a return for the FTSE 250 index of 16%. Since it floated, 3i Infrastructure’s annualised total shareholder return has been 12.7% against 6.1% for the FTSE 250, with very little correlation.
STEADY PROGRESS
The biggest uplift to the portfolio valuation so far this year has come from its investments in Dutch energy meter and electric vehicle charging point installer Joulz, Norwegian offshore communications firm Tampnet, French onshore wind energy company Valorem and its stake in the India Fund, which invests in infrastructure projects in the sub-continent.
Joulz is the third-largest business in the portfolio by asset value, while Tampnet is the second-largest. The largest firm is UK utility firm Infinis, which generates electricity from landfill gas and has total installed capacity of over 300 megawatts.
Operationally and financially Infinis performed ahead of expectations in the first half and thanks to its short-term hedging strategy it suffered limited impact from lower power prices, although prudently the firm has revised down its medium and longer term price forecasts.
Last month the company acquired further stakes in its Dutch private-public partnership projects for €25 million and invested £15 million in Danish offshore emergency rescue firm ESVAGT to fund the purchase of three new vessels.
Managing partner Phil White said: ‘The uncertainty created by the Covid-19 pandemic continues to create a degree of volatility in the financial markets, but we have seen a reasonable level of transaction activity in the infrastructure sector demonstrating continued investor appetite for the resilience inherent in many infrastructure businesses.’
