Media 

Greencoat UK Wind PLC: Interim Management Statement

15 October, 2013

GREENCOAT UK WIND PLC

(the "Company")

 

Interim Management Statement

 

Greencoat UK Wind ("UK Wind" or the "Company"), a listed infrastructure fund invested solely in operational UK wind farms, today announces its interim management statement for the period since 1 July 2013. The Company's September 2013 Factsheet will be available on the Company's website, www.greencoat-ukwind.com.

 

Highlights

  • Operational performance continues to be in line with management expectations
  • Net Asset Value (NAV) increased from £262.4m to £263.8m on 30 September 2013
  • Dividend of 1.5p per share, announced on 19th August 2013, was paid on 20 September 2013.  This is consistent with the Company's objective of distributing a 6.0p per share annual dividend
  • The acquisition of two new onshore wind farms, for a net consideration of £63.6m, was completed on 2 October 2013Increases UK Wind's portfolio to 8 wind farm investments with a total generation capacity of 153.1MW
  • Acquisitions were funded by cash from operations and the Company's acquisition debt facility

 

Tim Ingram, Chairman of Greencoat UK Wind, said:

"We are pleased to announce the continued good performance of our portfolio.  Since the announcement of our interim results we have paid our maiden dividend, grown net asset value to £263.8m million and, importantly, we have completed our first acquisitions since listing."

"The opportunities lying ahead for Greencoat UK Wind are very exciting.   There is a substantial pipeline of future acquisition opportunities in the UK market.  We believe that the independent model the Company has adopted, together with no leverage at the asset level, positions us well with utility and private vendors alike and will enable us to continue to add further wind farms to our portfolio at prices accretive to value.  We look forward to delivering further growth whilst ensuring sustainable returns to our investors."

 

Laurence Fumagalli, Partner of Greencoat Capital LLP, said:

"We recently acquired 100% stakes in Cotton Farm and Earl's Hall Farm onshore wind farms taking the size of our portfolio from 126.5 MW to 153.1MW.  These additions demonstrate our ability to source and then efficiently execute new investment in operating UK wind farms."

 

Acquisitions

During the period UK Wind acquired 100% shareholdings in two wind farms: Cotton Farm, a 16.4MW onshore wind farm in Cambridgeshire; and Earl's Hall Farm, a 10.25MW onshore wind farm in Essex.  The total consideration, net of cash, was £63.6m, which was funded by cash from operations and the Company's acquisition debt facility.

 

Investment Performance and Dividends

The Net Asset Value increased from £262.4m to £263.8m, equivalent to a NAV per share increase from 100.9p at 30 June 2013 to 101.4p at 30 September 2013.  Adding back the dividend payment, NAV per share growth was 2.0p in the period.

UK Wind paid a dividend of 1.5 pence per share on 20 September 2013 in respect of the period from 27 March 2013 to 30 June 2013. This is consistent with the Company's objective of distributing a 6.0p per share annual dividend.


Gearing

UK Wind has the ability to raise debt at the fund level as stated in the Company's investment policy.  The limit on total short-term acquisition financing and long-term debt is 40% of gross asset value ("GAV") at drawdown.  UK Wind drew down on its acquisition debt facility to make its recent acquisition.  The outstanding debt of £60m was equal to 19% of GAV at drawdown. 

 

Outlook and Pipeline of Future Acquisitions

The Company anticipates substantial growth in the UK wind farm market, providing further investment opportunities at an attractive yield.  The Company believes its approach of maintaining no leverage at the asset level and ability to act independently positions it competitively in the market to acquire operational assets and makes it an attractive partner for utility vendors.

The Investment Manager has identified a short to medium term pipeline of over 400MW of operating UK wind farm investments and is currently actively evaluating, performing due diligence on and negotiating a number of interesting opportunities.

The Government's Electricity Market Reform and subsequent Energy Bill are currently being finalised and moving through Parliament. Importantly, the current proposals maintain the long established principle of grandfathering the current Renewable Obligation regime for existing operational projects.

 

Investment Management Fee - Share Issuance

In order to reduce issuance costs associated with the equity element of the management fee, it has been agreed between the Company and the Investment Manager that such fees are paid on a half-yearly as opposed to a quarterly basis.  As a result, the equity element of future fees will be paid in January and July for the prior and current quarter.  The number of accrued shares to be issued in January 2014 in respect of Q4 2013 is 130,134.