https://ncim.co.uk/wp/wp-content/upload ... -04.24.pdf30 April 2024, CQS New City High Yield Fund, Investor Report:
The funds from this were reinvested into Next Energy Solar fund which was trading on a 30%
discount to its NAV and giving a yield of 10.9%. We believe this offers good value as the company has
recently rolled its Revolving Credit Facility (RCF) debt at a competitive level.
https://quoteddata.com/2024/05/qd-view- ... e-returns/01/06/2024, QuotedData, Dividend royalty: Our top 4 income payers to beat inflation and optimise returns:
As the name implies, NextEnergy Solar Fund (NESF) holds a portfolio of primarily UK-based solar energy infrastructure and complementary energy storage assets. Since launch nearly a decade ago, NESF has built a £1.2bn, 933MW portfolio of 100 operating solar assets, powering the equivalent of over 330,000 homes, declared dividends totalling £333m, and avoided the emission of about 2.2 Mt CO2e.
NESF’s portfolio generates strong cash flows, with the 2024 financial year target dividend of 8.35p expected to be covered 1.3 times. Although NESF lacks revenue reserves, its cash flows can be estimated with a good degree of accuracy – solar irradiation can be predicted with a decent degree of confidence (it tends to fall within a band of +/-7% 95% of the time) and using PPAs to sell some power generated forward at known prices also helps. This allows the board to announce a target for a fully covered dividend for each forthcoming financial year, which it has gone on to achieve in every year so far.
NESF has the highest yield of any trust in this group, a result of both its strong cash flow and wide discount, but the yield would still be attractive if it was trading at asset value (8.9% yield, which is well above inflation). There is potential for the discount to narrow as NESF has decided to put five of its assets up for sale to reduce borrowings and fund a potential share buyback, which could act as a powerful catalyst for a positive rating of its shares.
I recently added a position and started to follow this thread.Hope the recent additions to my news vault is helpful.