HICL Infrastructure PLC (HICL)

[idpickering]

Notice of Interim Results.

HICL advises that it plans to announce its Interim Results for the six months ended 30 September 2022 on Wednesday 23 November 2022.

There will be a results presentation for analysts at 9.30am on the day at the offices of InfraRed Capital Partners, Level 7, One Bartholomew Close, Barts Square, London, EC1A 7BL. Institutional investors are invited to dial into a live webcast of the presentation, which will be uploaded to the HICL website shortly thereafter.

To register for the event, please notify Teneo by email at HICLrsvp@teneo.com .

In addition, the Company will be hosting a presentation for retail investors via the Investor Meet Company platform at 2.00pm.

The presentation will be open to all existing and potential shareholders. Questions can be submitted pre-event via the Investor Meet Platform dashboard, up until 9.00am on the day before the meeting. Questions can be submitted at any time during the live presentation.

Investors who already follow HICL on the Investor Meet Company platform will automatically be invited to the meeting. Those wishing to sign up and join the meeting online, can do so here: https://www.investormeetcompany.com/hic ... r-investor .

https://www.investegate.co.uk/hicl-infr ... 00107672D/

Ian.

[idpickering]

Second Quarterly Interim Dividend.

HICL Infrastructure PLC (the "Company") is pleased to announce the second interim dividend for the financial year ending 31 March 2023 of 2.06 pence per ordinary share (the " Q2 Dividend" ).

The shares will go ex-dividend on 24 November 2022 and the Q2 Dividend will be paid on 30 December 2022 to shareholders on the register as at the close of business on 25 November 2022.

As outlined in the Company's prospectus dated 4 March 2019, a portion of the Company's dividends will be designated as an interest distribution for UK tax purposes. The interest streaming percentage for the Q2 Dividend is 32%.

https://www.investegate.co.uk/hicl-infr ... 30016619G/

Ian. (I hold HICL)

[idpickering]

Interim Results 6 months ended 30th September 2022.

· HICL delivered a resilient result in the period, with Net Asset Value ("NAV") growth of 1.2p per share to 164.3p (March 2022: 163.1p) and an Annualised Total Shareholder Return1 of 6.7% (September 2021: 9.8%) despite an uncertain macroeconomic and geopolitical environment.

· 50bps increase in the portfolio's weighed average discount rate to 7.1% at 30 September 2022 (31 March 2022: 6.6%) recognising the uplift in long-term government bond yields, particularly in the UK.

· The financial impact of the change in discount rates was offset by higher actual and forecast inflation, demonstrating the benefit of HICL's highly diverse portfolio, which continues to offer the highest inflation correlation in the listed core infrastructure peer group at 0.8x.

· Total return declined to £102.6m (September 2021: £ 139.5m) driven by the movement in discount rates relative to the prior period. In September 2021, the weighted average discount rate reduced to 6.6%.

· The Directors' Valuation2 increased by 17% to 3,865.6m at 30 September 2022 (31 March 2022: 3,311.0m) .

· Four significant high-quality core infrastructure acquisitions were announced in the period, totalling c.£616m. These investments, spanning both traditional and modern economy sectors, will bolster HICL's resilience through increased sector and geographic diversity and contribute positively to key portfolio performance metrics.

· The Board reaffirms that HICL is on track to deliver its target dividend of 8.25p per share3 for the year to March 2023, with cash cover in the period improving to 1.58x, or 1.03x excluding profits on disposal versus original cost (30 September 2021: 1.04x / 1.02x).

· The Board has reaffirmed its dividend guidance of 8.25p per share for the year to 31 March 20243.

· HICL raised gross proceeds of £160m via an oversubscribed tap issue during the period, which restored capacity in the Company's Revolving Credit Facility ("RCF") and provided additional financial resources to pursue the Company's pipeline.

· At 30 September 2022, HICL had £713m of headroom in its RCF and £79m of cash to fund its commitments to invest in ADTiM, Texas Nevada Transmission and Aotearoa Towers of c.£513m.

· HICL's high-quality core infrastructure portfolio is well positioned to withstand heightened market volatility, with assets that have robust capital structures and a portfolio that offers low overall beta to wider equity markets, a high yield and strong inflation protection.

https://www.investegate.co.uk/hicl-infr ... 00052762H/

Ian.

[idpickering]

Kepler Trust Intelligence: New Research.

HICL's portfolio continues to broaden but the shares have been de-rated...

The investment companies team at Kepler Trust Intelligence has produced a new piece of investment bank quality research about the trust, designed to provide a clear and comprehensive reference for long term investors. This note is free to read for UK investors.

From the item;

Analyst's View
The managers have been very active this year and HICL has a healthy, committed pipeline of investments. Aside from broadening the exposure of the portfolio, another positive effect from this activity is that the weighted average life of the portfolio has been extended from 30 years, as at 31/03/2022, to 33 years, as at 30/09/2022. In our view, this further boosts the resilience of the portfolio and shareholder value.

With a dividend target of 8.25p for the current financial year, as well as for the financial year ending 31 March 2024, HICL offers a prospective yield on the current share price of 5.1%. Cash cover of the dividend was negatively impacted by COVID lockdowns but as these assets recover, cash cover has continued to improve, with the managers reporting cash cover of 1.03 times for the six months to 30/09/2022.

As at 30/09/2022, HICL had net cash of £79m, representing 2.4% of net assets. HICL had a total of £713m available on its revolving credit facility (RCF), giving it plenty of firepower for the committed investments of £583.5m. In the interim results’ presentation, the managers commented that the RCF has since been partly drawn down to fund the Aotearoa Towers’ transaction. Depending on equity market conditions, this may suggest that HICL will look to raise further equity capital if market conditions improve.

In our view, HICL offers an uncorrelated return stream over the medium and long term which should have enduring appeal for long-term investors. The trust will be a direct beneficiary, in total return-terms, of any increase in long-term expectations for inflation, so investors may see the current discount to NAV of 2% as a potentially interesting entry point.

Bull
Lower-risk, institutional-quality infrastructure assets within a liquid vehicle that has scale
Steady and resilient yield, with dividend that is cash-covered
Returns are positively correlated to inflation

Bear
Demand-based assets do provide an element of correlation to economic activity
Capital is at risk if the manager is unable to continue to extend the weighted average asset life
Dividend cover is relatively low at 1.03x on a cash basis

https://www.investegate.co.uk/hicl-infr ... 00070602K/

I hold HICL.

Ian.

[Arborbridge]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

[OldPlodder]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

I think INPP is a better buy at the moment.

Old Plod.

[Dod101]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

I think INPP is a better buy at the moment.

Old Plod.

INPP is International Public Partnership apparently, for anyone who does not recognise the letters. I know nothing of them but I would not be buying HICL if it is still on a very big premium.

The capital values for most of these companies have been hit by the increased interest rates though.

Dod

[idpickering]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

I think INPP is a better buy at the moment.

Old Plod.

I've held HICL for a couple of years now. I like the diversification they bring to my HYP, but have found them to be lazy when paying out dividends. They get there eventually, but I'd rather they were paid on the stated payment date. For instance, their next one is due to be paid on 30 Dec 22, but I've already accepted (in my head at least) that I'm unlikely to see it until early Jan 23. I have toyed with selling them, but still hold, and shall continue to do so.
I've looked at 3IN before, but the just over 3% yield is to low for me tbh.
I hadn't looked at International Public Partnerships Limited (INPP) before, so thanks for bringing them to my attention.

Ian.

[kempiejon]

Ian, if they pay eventually, even the following week it really doesn't matter to me. I have 3 different brokers Halifax, AJ Bell and Hargreaves Lansdowne, and some are quicker than others. I think there are a few shares I hold with all three brokers and I know they don't pay on the same days.
As for 3IN, HICL, INPP and 3IN the price increase over 5 years is a few percent for HICL and INPP and 20 odd% for 3IN. Similar differences show for 10 years.
As for which to buy today I have no idea and only hold 3IN. I bought 3IN for it's long record of above inflation dividend increases and it's shown 7% CAGR in income compared to a couple of percent for the other two.

[Arborbridge]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

I think INPP is a better buy at the moment.

Old Plod.

INPP is International Public Partnership apparently, for anyone who does not recognise the letters. I know nothing of them but I would not be buying HICL if it is still on a very big premium.

The capital values for most of these companies have been hit by the increased interest rates though.

Dod

HICL is now at a slight discount, which is why my interest was renewed. The premium was ridiculous at one time.

Arb.

[Dod101]

3IN has been very good for me, but looking at the comparative metrics, I wonder whether HICL might be a good additional holding - perhaps with a reduced holding of 3IN.

I do hate splitting my effort between too many holdings, though, and with HCLs huge premium, it never seemed on the cards previously to hold both.


Arb.

I think INPP is a better buy at the moment.

Old Plod.

INPP is International Public Partnership apparently, for anyone who does not recognise the letters. I know nothing of them but I would not be buying HICL if it is still on a very big premium.

The capital values for most of these companies have been hit by the increased interest rates though.

Dod

HICL is now at a slight discount, which is why my interest was renewed. The premium was ridiculous at one time.

Arb.

Thanks, I was puzzled as to why it would be otherwise because most of the infrastructure companies are now at a discount following the hikes in the interest rates, substantially raising the discount rate at which they value their assets. Presumably the dividends are secure so it could indeed be a good entry point.

Dod

[idpickering]

Ian, if they pay eventually, even the following week it really doesn't matter to me. I have 3 different brokers Halifax, AJ Bell and Hargreaves Lansdowne, and some are quicker than others. I think there are a few shares I hold with all three brokers and I know they don't pay on the same days.
As for 3IN, HICL, INPP and 3IN the price increase over 5 years is a few percent for HICL and INPP and 20 odd% for 3IN. Similar differences show for 10 years.
As for which to buy today I have no idea and only hold 3IN. I bought 3IN for it's long record of above inflation dividend increases and it's shown 7% CAGR in income compared to a couple of percent for the other two.

Thanks for your reasoned input kempiejon. There'll be no knee-jerk reactions from me re HICL. I take on board what you've said re the dividends (I'm with Halifax by the way) , and shall just take a chill pill. lol.

Ian.

[kempiejon]

There'll be no knee-jerk reactions from me re HICL. I take on board what you've said re the dividends (I'm with Halifax by the way) , and shall just take a chill pill. lol.

Ian enjoy your pill.
Checking your quote, I think your delay might be more likely to lie with your broker than HICL. I usually find Halifax slower to settle than AJ Bell and HL. With Halifax, sometimes my ISA is has been slower than sharebuilder accounts.

[Dod101]

There'll be no knee-jerk reactions from me re HICL. I take on board what you've said re the dividends (I'm with Halifax by the way) , and shall just take a chill pill. lol.

Ian enjoy your pill.
Checking your quote, I think your delay might be more likely to lie with your broker than HICL. I usually find Halifax slower to settle than AJ Bell and HL. With Halifax, sometimes my ISA is has been slower than sharebuilder accounts.

I would think that the problem is not with HICL but the broker. I have never found my dividends late when I hold the shares in certificated form. They always satisfyingly appear in my account on the due date.

Just reminded me that Shell pays its dividend today. Must check.

Dod

[idpickering]

There'll be no knee-jerk reactions from me re HICL. I take on board what you've said re the dividends (I'm with Halifax by the way) , and shall just take a chill pill. lol.

Ian enjoy your pill.
Checking your quote, I think your delay might be more likely to lie with your broker than HICL. I usually find Halifax slower to settle than AJ Bell and HL. With Halifax, sometimes my ISA is has been slower than sharebuilder accounts.

I would think that the problem is not with HICL but the broker. I have never found my dividends late when I hold the shares in certificated form. They always satisfyingly appear in my account on the due date.

Just reminded me that Shell pays its dividend today. Must check.

Dod

I tend to agree re the broker thing. Halifax don't do much and they say some could be ten days late! Thanks both.

Ian.

[daveh]

There'll be no knee-jerk reactions from me re HICL. I take on board what you've said re the dividends (I'm with Halifax by the way) , and shall just take a chill pill. lol.

Ian enjoy your pill.
Checking your quote, I think your delay might be more likely to lie with your broker than HICL. I usually find Halifax slower to settle than AJ Bell and HL. With Halifax, sometimes my ISA is has been slower than sharebuilder accounts.

I would think that the problem is not with HICL but the broker. I have never found my dividends late when I hold the shares in certificated form. They always satisfyingly appear in my account on the due date.

Just reminded me that Shell pays its dividend today. Must check.

Dod

I tend to agree re the broker thing. Halifax don't do much and they say some could be ten days late! Thanks both.

Ian.

Don't own HICL, but do use HSDL. Generally they pay sterling dividends sometime on the pay date, though it can be late afternoon. Dividends that are paid in FX (I have ETFs that pay $ and euro divis) generally turn up next day or sometimes 2 or 3 days later, but HSDL tends to be a little slower than II for FX divis. I've yet to have them take longer than the 10 days their terms and conditions give them.

My Shell divi was in my bank account this morning, but not in my HSDL account this morning or when checked just now. BP and SBRY from Friday are there. I don't worry until its been a few working days and I'd only contact them when they'd been missing for 10 working days (not happened yet). I've got some ETF divis due to turn up at the end of the month, I'm not going to even check until 4th January as i expect with the holiday and the need for FX they will be a few days late. I try not to get worked up about it, as the only hassle would be if there was enough for a purchase and I was just waiting for a divi to appear.

[idpickering]

Don't own HICL, but do use HSDL. Generally they pay sterling dividends sometime on the pay date, though it can be late afternoon. Dividends that are paid in FX (I have ETFs that pay $ and euro divis) generally turn up next day or sometimes 2 or 3 days later, but HSDL tends to be a little slower than II for FX divis. I've yet to have them take longer than the 10 days their terms and conditions give them.

My Shell divi was in my bank account this morning, but not in my HSDL account this morning or when checked just now. BP and SBRY from Friday are there. I don't worry until its been a few working days and I'd only contact them when they'd been missing for 10 working days (not happened yet). I've got some ETF divis due to turn up at the end of the month, I'm not going to even check until 4th January as i expect with the holiday and the need for FX they will be a few days late. I try not to get worked up about it, as the only hassle would be if there was enough for a purchase and I was just waiting for a divi to appear.

Thanks for your input and wise words. My Shell dividend was pain into my account held with Halifax today too! But let's not stray from the topic of this thread.

Ian.

[idpickering]

Update on ADTiM SAS acquisition.

On 19 May 2022, the Company announced that it had secured conditional agreement to acquire a 55% interest in ADTiM SAS, an independent wholesale fibre network in France. As certain conditions related to this transaction have not been fulfilled, HICL today announces that the acquisition will not complete, and that the Company and the seller have formally ended the transaction process.

The Company remains on track to complete its remaining commitment, the acquisition of Texas Nevada Transmission, before 31 March 2023. This investment will be funded by the Company's £400m RCF. The £330m accordion remains available for the Company's attractive pipeline.

https://www.investegate.co.uk/hicl-infr ... 00020840P/

Ian.

[idpickering]

Interim Update Statement.

Mike Bane, Chair of HICL, said:

"HICL's portfolio continued to perform well in the period, with positive inflation correlation underpinning further NAV growth. Disciplined completion of transactions and successful integration of recent acquisitions into the portfolio remain the key focus for the Board and InfraRed."

Key Highlights

· Updated NAV as at 31 December 2022 of 165.8p, a 1.5p increase since 30 September 2022, and a weighted average discount rate of 7.2%. The 1.5p increase was predominantly driven by updates to actual inflation and deposit rates.

· Good progression of recently signed acquisitions, with Fortysouth1 successfully completed and consents well advanced on Texas Nevada Transmission.

· Exclusive pipeline of over £300m in high quality investment opportunities.

Net Asset Value

Given persisting macro-economic volatility, the Company is, by exception to the normal valuation cycle, providing an unaudited Net Asset Value per share as at 31 December 2022 of 165.8p , a 1.5 pence increase relative to 30 September 2022. The net increase is comprised of the following portfolio-specific and macro-economic factors:

· Continued higher actual inflation than assumed at 30 September 2022 in all jurisdictions, prompting revised assumptions with respect to near-term inflation. In particular, UK RPI and CPI assumptions have been revised upwards to 12.5% and 9.75% respectively for FY2023, delivering c. 2p of performance. The Company's assumptions for FY2024 onwards remain unchanged;

· Increases to deposit rate assumptions in all jurisdictions due to higher prevailing interest rates; and

· Asset-specific adjustments to discount rates. Overall the portfolio's weighted average discount rate increased to 7.2% (30 September 2022: 7.1%), also reflecting the inclusion of Fortysouth.

· Operational performance of the portfolio was broadly in line with expectations.

https://www.investegate.co.uk/hicl-infr ... 00047417R/


Ian.

[idpickering]

HICL announces 650m three-year facility.

The Board of HICL is pleased to announce that the Company has successfully renegotiated its revolving credit facility ("RCF") used to support the acquisition of new investments. The new RCF is a 650m multi-currency facility that runs to 30 June 2026, with options to extend for up to two additional years. The RCF remains on the same margin of 165bps over SONIA.

The facility's consortium of lenders remains unchanged and comprises Barclays, CIBC, ING, Lloyds, National Australia Bank, Royal Bank of Canada, Royal Bank of Scotland International and Sumitomo Mitsui Banking Corporation.

The RCF is a Sustainability Linked Loan, incorporating defined sustainability targets where HICL incurs a premium or reduction to the interest charged on the RCF based on performance against Environmental, Social and Governance KPIs . Performance against these targets is measured annually, with the cost of the RCF adjusted for the following year. Overall, the margin on the RCF can vary between 162bps and 168bps over SONIA.

At 17 March 2023, the Company had net debt of 170m, comprising cash of 49m and drawings on the RCF of 219m.

https://www.investegate.co.uk/hicl-infr ... 35464304T/

Ian.