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QuotedData’s morning briefing 14 September 2022

QuotedData's Morning briefing

In QuotedData’s morning briefing 14 September 2022:

  • Middlefield Canadian Income (MCT) has posted its half-year results for the six months to 30 June 2022, during which time its NAV rose by 3.4% while its share price was also up by 2,5%. The Canadian stock market outperformed most global indices even though over the period. Two quarterly interim dividends of 1.275p per share were paid on 31 January 2022 and 29 April 2022, while dividend growth from underlying holdings has contributed to an earnings surplus.  Several companies in the Canadian energy sector, such as Tourmaline Oil Corp. and Canadian Natural Resources, have supplemented their regular interim dividends with special distributions due to excess free cash flow. The board may consider future increases to the quarterly distribution if revenue continues to exceed its payout level.
  • Marble Point Loan Financing (MPLF) has posted its interim results for the half-year to 30 June 2022. During the period under review, the trust’s NAV total return fell by 25.17%, as leveraged loan and CLO prices fell toward post-pandemic lows across the market. While MPLF has not yet generated the desired level of liquidity in its shares, the board highlights an increase in trading volume in recent years. To further enhance share liquidity, it has completed two share buybacks and as at 30 June 2022 the trust has repurchased a total of 7 million shares at an average price of $0.52159 per share.
  • Menhaden Resource Efficiency (MHN) has posted its interim results for the six months to 30 June 2022, during which time its NAV per share fell by 13,3% while its share price total return also fell by 11.2%. At the end of June the share price stood at a 26.4% discount to the NAV per share, having narrowed a little from 28.1% at the end of 2021. The board has not declared an interim dividend in respect of this half year, as MHN will only pay dividends sufficient to maintain investment trust status. It remains unclear at this time whether that threshold will be crossed once again by the end of the financial year. The chair said: ‘It is likely that we will be faced with high inflation for some time yet, and with it rising interest rates and monetary and fiscal tightening as central banks and governments try to mitigate it. Together these will undoubtedly dominate market sentiment and drive further volatility.’
  • CATCo Reinsurance Opportunities (CAT) has published its half-year report reviewing the six months to 30 June 2022, during which time its NAV fell from $106.8m which consisted of $50.6m Ordinary Share NAV and $56.2m of C Share NAV to $18.1m, of which $4.7m relates to the Ordinary Share NAV and $13.4m to the C Share NAV. This reduction is due to the Buy-Out Transaction, implemented by way of a redemption of 99% of the holdings of each investor, the proceeds of which were paid to investors on 11 April 2022. The board has confirmed it will not raise further capital in any circumstances, and so CAT is being wound down by means of a managed process leading to liquidation in due course. Accordingly, the only further business that will be undertaken is that necessary to complete the Run-Off of each of the company’s portfolios.
  • Digital 9 Infrastructure (DGI9) has posted its interim results for the six months to 30 June 2022, during which time its NAV per share increased by 12.8%. Capital deployed and committed over the period was £1bn, including £414m of committed, but not yet deployed, funding for the acquisitions of Ficolo and Arqiva. During the period under review, DGI9 raised further gross equity proceeds of £95.2m via a secondary fundraise and £60m via a further fundraise. In March 2022, the group completed on a new syndicated revolving credit facility for £300m plus an uncommitted accordion of up to an additional £200mFollowing the equity raise in July 2022, the group triggered the accordion facility, extending the initial £300m facility by a further £75m in August 2022.
  • Apax Digital Fund II, in which Apax Global Alpha (APAX) is a limited partner, has invested in Xeneta, a leading ocean and air freight rate benchmarking and market analytics platform, as part of an $80m funding round led by ADF II. Following the investment, the Apax Digital Funds will work closely with Xeneta to help cement the company’s leading position and continue to drive penetration, leveraging several value creation leavers to help fuel growth. Xeneta’s CEO and Co-founder said:While global trade tries to get back on its feet after a couple of years of uncertainty, it’s clear that the overall logistics industry requires a re-think of how freight is bought and sold. This new funding will help us accelerate development of our platform and add even more datasets to enrich our expert industry analyses to further drive transparency in the market.’
  • Supermarket Income REIT (SUPR) has acquired a Tesco supermarket in Llanelli, South Wales, for £66.8m, reflecting a net initial yield of 5.3%. The store was developed for Tesco in 1989 and occupies a 10-acre site comprising a 82,046 sq ft net sales area supermarket, a 16-pump petrol filling station and 753 car parking spaces. The store is an online hub for Tesco, with 10 home delivery vans and a dedicated Click & Collect facility in the car park. The store is being acquired from M&G with an unexpired lease term of 12 years, with annual, upwards only RPI-linked rent reviews (subject to a 5.0% cap and 0.0% floor).
  • Residential Secure Income (RESI) has agreed a £15m expansion of its £10m revolving credit facility with Santander UK plc. The expansion comes with an interest rate margin reduction of 55 basis points, from 2.80% to 2.25%, as well as a one-year extension of the facility termination date to March 2025. The expanded £25.0m facility capacity and reduced interest rate margin allow for more efficient management of the Company’s working capital and provide lower-cost bridge financing for future investments.
  • RESI has also announced a £50m partnership with social impact real estate firm HSPG. Under the agreement, RESI has the exclusive option to acquire HSPG’s entire pipeline of shared ownership properties on a tranched basis, following completion of the homes, whilst HSPG will be responsible for letting to shared owners. RESI expects to acquire at least £50m of properties as part of the deal over the next three years. The first transaction under the partnership has now been completed, with the acquisition of 21 completed homes at the Laureate Fields development in Felixstowe, Suffolk, for £2.7m. The homes are part of a larger 197-unit masterplan development and comprise a mix of detached, semi-detached, and terraced two storey houses, developed by Generator Group. This latest acquisition brings RESI’s shared ownership portfolio to 725 homes, and a further 59 committed homes.

We also have results from Gulf Investment Fund and BioPharma Credit, new issue plans from Pantheon Infrastructure, an acquisition from JLEN Environmental Assets and a proposal to liquidate from Fundsmith Emerging Equities.

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