TIDMINPP
RNS Number : 0778S
International Public Partnership Ld
15 November 2011
International Public Partnerships Limited
Interim Management Statement
For the period 1 July 2011 to 14 November 2011
15 November 2011
International Public Partnerships Limited ("INPP", "the
Company"), a listed infrastructure investment company which invests
in global public infrastructure projects including those developed
under public private partnership ("PPP") and private finance
initiative ("PFI") procurement methods, today issues the following
Interim Management Statement for the period 1 July 2011 to 14
November 2011.
Highlights
-- The portfolio of 110 public infrastructure investments continues to perform in line with expectations
-- Investments totalling GBP117 million have been completed
since 1 January 2011 including GBP77 million of investments made
during the period 1 July 2011 to 14 November 2011. Investments in
the period since 1 July 2011 comprised:
-- Investment in a 100% interest in two offshore electricity
transmission assets (Gunfleet Sands and Barrow);
-- Investment in a 100% interest in Building Schools for the
Future Investments LLP. In addition minor follow on investments
have also been made with respect to this asset.
-- Completion of Phase 1 of the Royal Children's Hospital in
Melbourne, Australia which was opened by Her Majesty the Queen in
October. Clinical services are expected to commence in late
November 2011.
-- An interim distribution of 2.925 pence per share was paid to
shareholders on 28 October 2011
-- GBP52 million of new capital was raised via an equity issue
in September, adding to the Company's robust overall funding
position
-- Despite uncertain economic conditions, a continued strong pipeline of exciting opportunities exists in UK, Australia, and Europe across a variety of infrastructure sectors
Asset Performance
The Company's asset portfolio continues to perform well with
revenues and cash receipts in line with management forecasts.
The Company reports its Net Asset Value (NAV) every six months
when it publishes its full and interim results in March and August
each year. In addition, the Company provides quarterly NAV guidance
predominantly based on changes in risk free rate movements in the
countries where INPP holds investments and changes to foreign
exchange rates. This quarterly guidance does not reflect any
changes (positive or negative) in NAV arising from matters specific
to individual investments (eg de-risking, indexation adjustments
due to changes in inflation etc).
Since 30 June 2011 (NAV: 113.6p), risk free rates have decreased
in the majority of countries in which INPP is invested. The
reduction in these rates would be expected to have a positive
effect on the Company's NAV.
Over the same period, foreign exchange ("FX") movements have
seen GBP strengthening against the three currencies the Company has
exposure to. The strengthening GBP would lead to a corresponding
decrease in NAV.
Overall, the negative effects of FX movements on NAV would be
outweighed by the positive effects of falling risk free rates.
Based on these two macroeconomic updates the NAV would therefore
have increased since 30 June 2011.
New Investments
During the period since 1 July 2011 INPP made GBP77 million of
new investment including:
-- Acquiring 100% of the interests in Building Schools for the
Future Investments ("BSF") LLP from the Department for Education
and Partnerships UK for GBP58.4 million. This provides the Company
with minority interests in 48 'Building Schools for the Future'
projects, relating to over 100 individual schools. The acquisition
is, to date, INPP's largest transaction in the secondary market.
Since the date of the acquisition further additional follow on
investments have been made in BSF which are expected to be
accretive to the original acquisition economics; and
-- Acquisition of its second and third offshore electricity
transmission projects in the UK, Gunfleet Sands and Barrow, where
it invested GBP18.6m in return for 100% of the equity and
subordinated debt in those projects.
All projects are expected to be accretive for investors in both
NAV and yield terms.
Interim Distribution
On 28 October 2011, an interim distribution of 2.925 pence per
share was paid to shareholders on the register as at 16 September
2011. This distribution was for the period 1 January 2011 to 30
June 2011 and is a 2.6% increase on the distribution paid in the
previous corresponding period.
The Scrip Dividend Alternative Circular issued in September saw
26% of shareholders electing to take scrip in the Company, in lieu
of cash, and resulted in the issuance of an additional 3.5 million
shares.
The Board also announced a target distribution for the year 1
January 2011 to 31 December 2011 of 5.85 pence per share, which
represents a near 3% increase over the previous year and a fourth
consecutive annual increase. The Board confirms that it expects to
increase distributions in future years at least in line with its
long term inflation assumption of 2.5% per annum (provided for
guidance only, not intended to be a forecast).
Capital Raising and Share Capital
In September the Company announced that it had raised
approximately GBP52 million from the issuance of new equity.
46,428,447 new ordinary shares of 0.01p each were issued for cash
on an ex-dividend basis at 112.075 pence per share (the "Issue
Price").
The Issue Price represented a premium of 1.3 per cent to the
equivalent ex-dividend net asset value of 110.68 pence per ordinary
share as at 30 June 2011, being the last net asset value published
prior to issue.
The funds raised from shareholders has allowed the Company to
offset its existing drawn corporate facility and will enable it to
continue to take advantage of a strong pipeline of long-term
investment opportunities.
As at 14 November 2011 the Company had 534,234,191 shares in
issue. This included 46.6 million shares issued under the tap
facility in September and 3.5 million shares issued under the scrip
dividend alternative in October.
Balance Sheet and Funding
The Company had approximately GBP32 million of cash available
for the payment of distributions and working capital as at 14
November 2011. In addition, the Company has approximately GBP84
million of net capacity within its corporate debt facility and it
is expected that this and any surplus cash over that required to
fund distributions and working capital will be used to finance new
opportunities as they arise.
Portfolio
The assets in the Company's portfolio continued to perform in
line with expectations. A highlight during the period was the
opening of the Royal Children's Hospital in Melbourne, Australia by
Her Majesty the Queen. The opening of Phase 1 of the Hospital for
clinical services was an important milestone for the project, which
is due to complete in its entirety in late 2014.
As at 14 November 2011, the portfolio comprised economic
interests in 110 projects with a geographical split as detailed
below:
Location Number Sector 14 November 30 June 2011
of projects 2011
%(1) % (1)
---------------- ------------- ----------------------- ------------ -------------
Health
Govt accommodation
Courts
Police Authority
Education
United Kingdom 95 Offshore Transmission 57 49
---------------- ------------- ----------------------- ------------ -------------
Health
Roads/Tunnels
Health/Custodial
Australia 7 Entertainment 16 19
---------------- ------------- ----------------------- ------------ -------------
Education
Canada 2 Courts 7 8
---------------- ------------- ----------------------- ------------ -------------
Belgium 1 Transport 11 14
---------------- ------------- ----------------------- ------------ -------------
Transport
Germany 2 Education 7 8
---------------- ------------- ----------------------- ------------ -------------
Ireland 1 Courts 2 2
---------------- ------------- ----------------------- ------------ -------------
France 1 Health <1 <1
---------------- ------------- ----------------------- ------------ -------------
Italy 1 Health <1 <1
---------------- ------------- ----------------------- ------------ -------------
1. This breakdown is based on the fair value market valuation of
the Group's investments calculated utilising discounted cash flow
methodology, adjusted for European Private Equity and Venture
Capital Association (EVCA) guidelines.
Top Ten Investments
The Top Ten Investments of the Company as at 14 November 2011
were:
Investment %
---------------------------------- ---
Diabolo Project 11
---------------------------------- ---
BeNEX 6
---------------------------------- ---
Royal Children's Hospital 6
---------------------------------- ---
Hereford & Worcester Magistrates
Courts 6
---------------------------------- ---
Strathclyde Police Training
Centre 5
---------------------------------- ---
Alberta Schools 5
---------------------------------- ---
Northamptonshire Schools 5
---------------------------------- ---
Orange Hospital 3
---------------------------------- ---
Tower Hamlet Schools 3
---------------------------------- ---
Long Bay Forensic and Prison
Hospital 3
---------------------------------- ---
Outlook and Pipeline
INPP's existing portfolio of assets has performed well and,
despite recent volatility in sovereign debt and other global
markets, this performance is expected to continue. The Company is
also confident that it can continue to deliver growing dividends to
shareholders over the long-term.
The Company is also pleased to report a continued strong
pipeline of investment opportunities. In the UK the Company sees a
variety of opportunities for further investment. This includes
investment in the education sector through its interest in BSF,
both through follow-on investments from existing schemes as well as
the potential to acquire stakes from other existing BSF investors
who may wish to divest their stakes.
In addition, as previously announced, the Company is shortlisted
for a further three projects in the GBP1 billion second round of UK
offshore electricity transmission tenders. Preferred bidder status
on these projects is likely to be announced by the Government over
the next twelve months.
The Company is also pursuing a number of encouraging
opportunities in Australia and Europe, focused on further
investments in the education, transportation and health
sectors.
The Company continues to review proposals from third parties
seeking to dispose of assets meeting the Company's investment
criteria. It continues to apply its very disciplined approach to
the evaluation of these opportunities and to the extent that an
investment is made, it will only be on the basis that they are
projected to be accretive to the Company's cashflows and projected
returns.
End
For further information:
Erica Sibree +44 (0)20 7939 0558
Amber Fund Management Limited
Nick Westlake/Hugh Jonathan +44 (0)20 7260 1345/1263
Numis Securities
Ed Gascoigne-Pees/Ed Berry +44 (0)20 7269 7132/7297 FTI Consulting
Notes to Editors:
About International Public Partnerships (INPP):
International Public Partnerships Limited (INPP) is a listed
infrastructure investment company which invests in global public
infrastructure projects developed under the public private
partnerships (PPP) and private finance initiative (PFI) procurement
methods.
Listed in 2006, INPP is a long-term investor in 110 social and
transport infrastructure projects, including schools, hospitals,
courts, police headquarters, transport and renewable energy
projects in the U.K., Europe, Australia and Canada. INPP seeks to
provide its shareholders with both a long-term government-backed
yield and capital growth through investment across both
construction and operational phases of 25-40 year concessions.
Amber Infrastructure Group (Amber) is the Investment Advisor to
INPP and consists of more than 60 dedicated infrastructure
specialists which originate and source a strong pipeline of
projects for INPP.
Visit the INPP website at
www.internationalpublicpartnerships.com for more information.
This interim management statement has been prepared solely to
provide additional information to shareholders as a body to meet
the relevant requirements of the UK Listing Authority's Disclosure
and Transparency Rules and the interim management statement should
not be relied on by any other party or for any other purpose.
Forward-looking statements are not guarantees of future
performance. The Company's actual investment performance, results
of operations, financial condition, liquidity, distribution policy
and the development of its financing strategies may differ
materially from the impression created by the forward-looking
statements contained in this document. Subject to their legal and
regulatory obligations, International Public Partnerships and its
Investment Advisor expressly disclaim any obligations to update or
revise any forward-looking statement contained herein to reflect
any change in expectations with regard thereto or any change in
events, conditions or circumstances on which any statement is
based.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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