REG - Renew Infra Grp Ld - Net Asset Value update – Q1 2025

Renewables InfrastructureAnnouncement

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RNS Number : 4355H  Renewables Infrastructure Grp (The)  06 May 2025

 

 

6 May 2025

The Renewables Infrastructure Group Limited

"TRIG" or "the Company", a London-listed renewables investment company advised
by InfraRed Capital Partners ("InfraRed") as Investment Manager and Renewable
Energy Systems ("RES") as Operations Manager.

Net Asset Value update - Q1 2025

TRIG announces an estimated unaudited Net Asset Value as at 31 March 2025 of
112.7 pence per share, a decrease of 3.2 pence per share in the quarter
principally due to a reduction in Swedish power price forecasts (-1.2p), an
increase in European discount rates (-1.2p) and low wind resource in the
quarter (-1.0p).

Q1 2025 movements in Net Asset Value per share

The key drivers of the movement in NAV per share over the quarter are
summarised in the table below:

                                       Net Asset Value  Positive Movements  Negative Movements

                                       (p / share)      (p / share)         (p / share)
 NAV per share at 31 December 2024     115.9
 Q1 performance                                                             (1.1)
 Discount rate movements                                                    (1.2)
 Changes to revenue forecasts                                               (1.4)
 Value enhancement and share buybacks                   0.5
 NAV per share at 31 March 20251       112.7

Q1 performance

Portfolio performance was below forecasts for the quarter. Generation was 13%
below budget predominantly driven by lower-than-average wind levels,
particularly for UK wind projects. Demonstrating the benefits of portfolio
diversification, generation from TRIG's UK solar and Swedish wind portfolios
were above budget. Whilst this will impact operational cash flows in the short
term, the Company expects to cover its target dividend of 7.55 pence per share
for FY 2025(2).

Power price levels achieved in the quarter were slightly above budgeted levels
for all regions.

Actual inflation was marginally above levels assumed in the valuation at 31
December 2024.

Sterling weakened 1% vs the Euro in the quarter. FX hedges slightly reduced
the favourable impact from this movement.

Discount rates

European discount rates have been increased by 30bps, reflecting movements in
government bond yields during Q1. This change resulted in a -1.2p impact on
the NAV per share. No adjustment was made to UK discount rates which were
increased by 30bps in Q4 of 2024. The portfolio weighted average discount rate
is now 8.7% representing a 4.7% equity risk premium over the portfolio
weighted average reference rate.

Changes to power price forecasts

TRIG continues to use the average power price forecast of three leading
forecasters taking each of their technology and geography specific
projections, and allowing for cannibalisation(3).

Overall, there was a reduction in power price forecasts across the markets
within which TRIG has investments, which had an adverse impact of -1.4p, which
was predominantly driven by a reduction in the Swedish power price forecast
comprising -1.2p of the movement.

The near-term Swedish power curve projection is lower than previously forecast
as a result of high hydroelectricity reservoir levels and weak industrial
demand. In the medium term, forecasters expect a reduced rate of electricity
demand growth, including slower rollout of green hydrogen and EV battery
manufacturing capacity in northern Sweden, and high renewables buildout.

The GB power price forecast remained broadly unchanged.

Value enhancement

The disposal of an 15.2% equity stake in the Gode offshore windfarm completed
in the quarter. Proceeds were used to reduce drawings under the Company's
Revolving Credit Facility. At 31 March 2025, the RCF was drawn £255m.

TRIG's Managers continue to work towards raising £300m capital in 2025
through debt financings and further divestments.

Construction of the 78MW two-hour Ryton battery continues to progress on-time
and on-budget. Ground works and cabling are complete. Main components are now
being installed starting with the power conversion systems. Batteries are in
transit and will be arriving to site in May.

Projects in France totalling 73MW net capacity are commencing their
participation in ancillary service markets creating additional revenues for
the associated investments, with similar initiatives being pursued in Sweden
and already underway in Spain.

Further detail on TRIG's long-term strategy will be provided to institutional
investors and sell-side analysts at the Company's 2025 Capital Markets Seminar
on Wednesday 28 May 2025 at 14:15 UK time (registration from 14:00).
Presentations from the Managers of TRIG, InfraRed and RES, will cover a range
of topics including the Managers' approach to asset rotation, revenue
management, and growth levers such as development, construction and
operational enhancements. Those wishing to attend should
email triginfo@ircp.com (mailto:triginfo@ircp.com) .

Share buybacks

As at 30 April 2025, £50m of the current £150m share buyback programme has
been deployed in the repurchase of TRIG shares.  During the quarter to 31
March 2025, 29m shares were repurchased for aggregate consideration of £22m,
delivering NAV accretion of +0.4p per share.

(1) NAV per share at 31 March 2025 presented after unwind of the discount
rate, company costs and payment of the quarterly interim dividend.

(2) Past performance is not a reliable indicator of future results. There can
be no assurance that targets will be met or that the Company will make any
distributions, or that investors will receive any return on their capital.
Capital and income at risk.

(3) Cannibalisation describes the effect that renewables (a variable
generator) can have on the overall power prices, whereby the marginal cost of
generation, which in turn drives the power prices, is lower than the average
which would be expected of a continuous base load generator as a result of the
additional supply when renewables are generating. Rates differ over time and
between markets but all are affected.

Enquiries

InfraRed Capital Partners
Limited                              +44 (0) 20
7484 1800

Minesh Shah

Phil George

Mohammed Zaheer

 

Brunswick
+44 (0) 20 7404 5959 / TRIG@brunswickgroup.com

Mara James

 

Investec Bank
Plc
+44 (0) 20 7597 4000

Lucy Lewis

Tom Skinner

 

BNP
Paribas
+44 (0) 20 7595 9444

Virginia Khoo

Carwyn Evans

Notes

The Company

The Renewables Infrastructure Group ("TRIG" or the "Company") is a leading
London-listed renewable energy infrastructure investment company. The Company
seeks to provide shareholders with an attractive long-term, income-based
return with a positive correlation to inflation by focusing on strong cash
generation across a diversified portfolio of predominantly operating projects.

 

TRIG is invested in a portfolio of wind, solar and battery storage projects
across six markets in Europe with a net operational capacity of 2.3GW; enough
renewable power for 1.6 million homes and to avoid 2.0 million tonnes of
carbon emissions per annum.

 

Further details can be found on TRIG's website at www.trig-ltd.com
(http://www.trig-ltd.com) .

 

Investment Manager

 

InfraRed Capital Partners is an international infrastructure asset manager,
with more than 160 professionals operating worldwide from offices in London,
Madrid, New York, Sydney and Seoul. Over the past 25 years, InfraRed has
established itself as a highly successful developer and steward of
infrastructure assets that play a vital role in supporting communities.
InfraRed manages US$13bn of equity capital(1) for investors around the globe,
in listed and private funds across both core and value-add strategies.

InfraRed is part of SLC Management, the institutional alternatives and
traditional asset management business of Sun Life.

For more information, please visit www.ircp.com. (https://www.ircp.com.)

 

(1) Uses five-year average FX as at 31 December 2024 of GBP/USD of 1.2818;
EUR/USD 1.1092. EUM is USD 13.186bn.

 

Operations Manager

TRIG's Operations Manager is RES ("Renewable Energy Systems"). RES is the
world's largest independent renewable energy company, working across 24
countries and active in wind, solar, energy storage, biomass, hydro, green
hydrogen, transmission, and distribution. An industry innovator for over 40
years, RES has delivered more than 24GW of renewable energy projects across
the globe and plans to bring more than 22GW of new capacity online in the next
five years.

As a service provider, RES has the skills and experience in asset management,
operations and maintenance (O&M), and spare parts - supporting 41GW of
renewable assets across 1,300 sites. RES brings to the market a range of
purposeful, practical technology-based products and digital solutions designed
to maximise investment and deployment of renewable energy. RES is the power
behind a clean energy future where everyone has access to affordable zero
carbon energy bringing together global experience, passion, and the innovation
of its 4,500 people to transform the way energy is generated, stored and
supplied.

Further details can be found on the website at www.res-group.com
(http://www.res-group.com/) .

 

 

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