TIDMINPP
RNS Number : 4222D
International Public Partnership Ld
16 May 2012
International Public Partnerships Limited
Interim Management Statement
For the period 1 January 2012 to 15 May 2012
16 May 2012
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"), private finance
initiative ("PFI") and similar procurement methods, today issues
the following Interim Management Statement for the period 1 January
2012 to 15 May 2012.
Highlights
-- The portfolio of 119 public infrastructure investments
arising from 69 separate projects continues to perform in line with
expectations
-- Announced 2011 Annual Results for period to 31 December 2011
reporting solid increase in Net Asset Value ("NAV") per share to
116.9p (2010: 113.1p per share)
-- Announcement of an intended Placing, Open Offer and Offer for
Subscription (the "Issue") of new ordinary shares during the second
quarter of this year with a target size of GBP180 million. Proceeds
of the Issue will be used to:
o Pay down the existing debt under the Company's corporate
revolving debt facility; and
o Acquire approximately GBP170 million of investment,
representing three exclusive opportunities.
-- Awarded preferred bidder status for the long-term licence and
operation of Lincs offshore transmission project
-- Completion of construction at South Bristol Community
Hospital and the GBP35 million Moray Schools project
-- 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 31 December 2011 (NAV: 116.9p), risk free rates have
decreased slightly in the majority of countries in which INPP is
invested. The reduction in these rates could 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 could be expected to 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 alone the NAV could be
expected to have increased slightly since 31 December 2011.
In the course of its normal practice the Company also reviews
market based evidence in its assessment of NAV. Since 31 December
2011, the Company has not seen demonstrable evidence that values of
infrastructure assets have increased in line with the net effect of
such macroeconomic factors thus on balance the Company considers
that its NAV has remained stable over the period (after allowing
for distributions declared).
Distribution
On 19 April 2012, the 2011 final distribution of 2.925 pence per
share was declared for shareholders on the register as at 27 April
2012. This distribution was for the period 1 July 2011 to 31
December and was a 2.6% increase on the distribution paid in the
previous corresponding period.
The Scrip Dividend Alternative Circular applicable to that
dividend was issued on 8 May 2012. The associated scrip allotment
or dividend payment is expected to be made on 15 June 2012.
The Board also announced a target distribution from income
received in the year 1 January 2012 to 31 December 2012 of 6.0
pence per share, which represents a 2.6% increase over the previous
year and a fifth 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. This is a target and not a profit
forecast. There can be no guarantee that any distribution will be
paid.)
Capital Raising
On 8 May 2012 the Board of International Public Partnerships
Limited announced that it expected to proceed with an Issue of new
ordinary shares during the second quarter of this year.
As previously advised, the Company has approximately GBP170
million of investment opportunities, representing three potential
investments in respect of which it has exclusivity, that have
progressed to an advanced stage. In addition, the Company has a
strong pipeline of other longer term opportunities. The proceeds of
the fundraising, which is anticipated to have a target size of
GBP180 million, are expected to be used to pay down the Company's
corporate revolving debt facility and fund the acquisition of the
assets in respect of which it has exclusivity, leaving the Company
with the ability, through the revolving debt facility, to purchase
additional accretive assets in the medium term.
It is envisaged that a prospectus will be published in May with
trading in the new shares commencing after the Company's Annual
General Meeting in June. Further details as to the precise timing
and size of the Issue will be announced in due course.
Balance Sheet and Funding
The Company had approximately GBP38 million of cash available
for the payment of distributions and working capital as at 15 May
2012. In addition, the Company has approximately GBP81.9 million of
net capacity within its corporate debt facility.
Portfolio
The assets in the Company's portfolio continued to perform in
line with expectations. Highlights during the period include the
completion of construction at South Bristol Community Hospital and
the GBP35m Moray School project which replaced the existing
facilities at Keith Primary and Elgin Academy.
As at 15 May 2012, the portfolio comprised economic interests in
119 projects with a geographical split as detailed below:
Location Number Sector 15 May 2012 31 December
of projects 2011
%(1) % (1)
---------------- ------------- ----------------------- ------------ ------------
Health
Govt accommodation
Courts
Police Authority
Education
United Kingdom 104 Offshore Transmission 55 55
---------------- ------------- ----------------------- ------------ ------------
Health
Roads/Tunnels
Health/Custodial
Australia 7 Entertainment 17 18
---------------- ------------- ----------------------- ------------ ------------
Education
Canada 2 Courts 6 6
---------------- ------------- ----------------------- ------------ ------------
Belgium 1 Transport 13 12
---------------- ------------- ----------------------- ------------ ------------
Transport
Germany 2 Education 6 6
---------------- ------------- ----------------------- ------------ ------------
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 15 May 2012
were:
Investment %
---------------------------------- ---
Diabolo Project 13
---------------------------------- ---
Royal Children's Hospital 7
---------------------------------- ---
BeNEX 6
---------------------------------- ---
Hereford & Worcester Magistrates
Courts 6
---------------------------------- ---
Strathclyde Police Training
Centre 5
---------------------------------- ---
Northamptonshire Schools 5
---------------------------------- ---
Alberta Schools 4
---------------------------------- ---
Orange Hospital 3
---------------------------------- ---
Tower Hamlet Schools 3
---------------------------------- ---
Angel Trains 3
---------------------------------- ---
Outlook and Pipeline
The market for infrastructure is strong but evolving. The
Company is well placed to take advantage of such evolution. The
general trend is for governments to be very supportive of
additional private sector investment in infrastructure. More
specifically however we are seeing fewer UK private finance
initiative projects being developed due to UK Government spending
cuts. However for the Company any decline in this area is currently
being more than made up by current and prospective opportunities in
other areas and geographies. More detail is provided on specific
opportunities in the Group's recently published 2011 Annual
Report.
Overall there continues to be a strong pipeline of investment
opportunities and we are encouraged by governments' reaffirmation
of the importance of private sector involvement in the provision of
such assets. This includes, in the UK, through the National
Infrastructure Plan the likelihood of greater investor interest in
the sector, bolstered by the Government's proposed plans to involve
UK pension funds in the provision of financing to infrastructure
schemes.
There are also a number opportunities in Australia and Europe,
focused on education, transportation and health sectors which,
through the Investment Advisor, the Company is also actively
pursuing. The Company continues to review proposals from third
parties seeking to dispose of assets meeting the Company's
investment criteria.
Any such investment, whether sourced from the primary or
secondary market, is assessed in a very disciplined way and to the
extent that an investment is made, it will only be on the basis
that it is projected to reinforce the Company's cashflows and
projected returns. To the extent that additional capital is
required, the Company has previously indicated that it may approach
investors during the year to fund these acquisitions.
Overall, we continue to remain positive about the prospects for
the Company, both in terms of the performance of its existing
assets and the opportunity to add high quality assets to the
portfolio during the remainder of 2012.
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
About International Public Partnerships (INPP):
International Public Partnerships (INPP) is a listed
infrastructure investment company which invests in global public
infrastructure projects developed under the public private
partnerships (PPP), private finance initiative (PFI) and other
similar procurement methods.
Listed in 2006, INPP is a long-term investor in 119 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. It
does not constitute an invitation to subscribe for or otherwise
acquire or dispose of securities in the Company (defined below) in
any jurisdiction. The information contained in this interim
management statement about the Issue is subject to updating and
amendment, and does not purport to be full or complete. No reliance
may be placed for any purpose on the information contained in this
interim management statement in connection with the Issue or the
purchase of securities in the Company. This interim management
statement does not constitute or form part of any offer to issue or
sell, or any solicitation of any offer to subscribe or purchase,
any investments nor shall it (or the fact of its distribution) form
the basis of, or be relied on in connection with, any contract or
commitment whatsoever. Any decision to purchase shares should be
made solely on the basis of the information contained in the final
prospectus issued by the Company.
The potential acquisition by the Company of any of the
investments referred to in this interim management statement is
subject, among other things, to those projects reaching legal
completion and to the Company having conducted satisfactory due
diligence in relation to such investments. Although the Company has
a right of first refusal for investments disposed of by the Amber
group, any acquisitions will be subject to agreement having been
reached between the Company and the relevant counterparty as to the
terms of the acquisitions. In addition, some of the investment
opportunities are those where Amber or the Company is currently
undergoing a bidding process. There is no guarantee that they will
be successful in any such bidding process. There is therefore no
guarantee that any of the investments will be acquired and if they
are on what terms.
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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