Riverstone Credit Opportunities (RCOI) reported its results for the 12 months ending 31 December 2023.
- Over the 12 months RCOI reported a NAV total return of 6.4%, having returned 40.1% since its inception.
- Revenue generation was “strong” over the year, with a reported profit of $5.7m, and a proposed total dividend of 8.5 cents per share, which meets RCOI’s stated distributions target.
- RCOI’s portfolio currently holds nine direct investments across energy infrastructure & infrastructure services and energy transition assets. RCOI completed one new investment and two realisations during the year.
- Over the year RCOI realised its loan to Clean Energy Fuels for a net IRR of 10.8%. RCOI also refinanced its loan to Streamline Innovations for a profit of $2.0m (equal to a 19% net IRR), as well as making a new investment in the company by extending the duration of its investment to December 2026.
- There is a forthcoming realisation vote in May 2025, where shareholders will vote whether or not to re-designate their shares on a one for one basis to realisation shares.
RCOI’s investment managers commented:
“In aggregate, two investments were realised during 2023, one of which as part of a successful refinancing. The Investment Manager continues to believe that this is a market where patience and a disciplined approach to investing are likely to be well rewarded and create real value for shareholders.
“The backdrop for the broader energy sector remains strong, continuing the trend seen in 2023. Given our focus on energy infrastructure, infrastructure services and energy transition assets, RCOI is ideally poised to continue to take advantage of the investment opportunity brought about by the convergence of two market phenomena, namely the consistent growing demand for sources of energy and the concurrent need for the global infrastructure industry to meet global “net-zero” targets.
“The two realisations and one amendment and extension made during the year have resulted in additional proceeds to distribute to investors. As the commodity market overall remains strong, we are well positioned to continue to provide stable cashflows and an attractive yield. Additionally, despite the recent increase in inflation and rise in interest rates, our floating rate loans are all based on SOFR with floors and don’t decline in value as interest rates are likely to rise.
“Based on the current unfunded commitments, recent deal activity, and potential new investment opportunities, we anticipate continuing to provide attractive returns and consistent yield in the portfolio in order to optimise shareholder value.
“We are cognisant of the forthcoming realisation election in May 2024 and look forward to engaging with shareholders to understand both their intentions to participate and their views regarding the future of the Company. We remind investors that if the Company’s remaining Ordinary net asset value falls below $50m as a result of the election, the Company will amend its investment objectives and policy to adopt a realisation strategy. As always, we remain vigilantly focused on optimising the portfolio to ensure long-term value creation for our shareholders.”