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QuotedData’s morning briefing 12 December 2024, DGI9, BGFD, MTE, GSF, AIE, SMIF, NRR, RGL

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In QuotedData’s morning briefing – 12 December 2024:

  • Digital 9 Infrastructure (DGI9) says InfraRed Capital Partners’ appointment as AIFM has become effective today. Triple Point’s role as AIFM also terminated effective today.
  • Baillie Gifford Japan (BGFD) passed its continuation vote at yesterday’s AGM, the voting was 85.4%:14.6% in favour of continuation, and about 55% of its shares in issue were voted.
  • Montanaro European (MTE) published half-year figures to end September 2024. It is beating its benchmark and narrowing its discount, but the gyrations in the market left the NAV fairly flat. The NAV total return was 0.1%, the MSCI Europe SmallCap (ex-UK) Index) fell by 0.9%, the discount narrowed from 13.7% to 12.2%, and the share price increased by 1.8%. Smaller companies in Europe outperformed their larger counterparts by 2% [The report suggests that this could be a return to normality (where small cap tends to outperform) after an extended period when it did not.]
  • Gore Street Energy Storage (GSF) says that the energisation process for its Big Rock battery in California is expected to be completed in the coming weeks. Dogfish (Texas) remains on schedule for energisation in February 2025.  The company’s Enderby asset, a 57 MW/57 MWh asset in GB, has completed all necessary milestones for energisation. Energisation is now scheduled for January, with delays attributable to National Grid Electricity Transmission and winter outage season. [The encouraging news in the results presentation was that the company is still receiving term sheets from people interested in the tax credits from Big Rock and Dogfish, even post the election. The $60m-$80m projected cash inflow from this is material in the context of the trust’s market cap.]
  • Ashoka India Equity (AIE) has agreed to a request from White Oak Capital Partners Pte. Ltd, the investment adviser, to an increase in permitted exposure from 10% to 12% of gross assets (calculated at the time of investment) in unquoted companies with a significant presence in India. [This reflects the booming IPO market in India and Ashoka India’s ability to profit by making pre-IPO investments].
  • Twenty Four Select Monthly Income (SMIF) announced results for the year ended 30 September 2024. The NAV total return was 22.6% and the total annual dividend for the year was 7.38p, up from 7.37p. Looking at what drove these returns the report says that 80% of the portfolio was allocated to some of the strongest performing credit sectors: Collateralised Loan Obligations (CLOs) and subordinated financials (AT1 bonds and Restricted Tier 1 bonds) which returned 25.9%, 24.22% and 25.28% respectively. There was strong performance from other sectors including European High Yield (17.7%), floating-rate Asset-Backed Securities (ABS), and CLOs in particular, benefitted from higher for longer central bank rates. The financials sector, particularly European banks, offered compelling risk-reward opportunities in global credit.
  • NewRiver REIT (NRR), which completed the £151m acquisition of Capital & Regional (CAL) this week, reported interim results that saw EPRA net tangible assets fall 8% to 106p per share over the six months to 30 September 2024. This reflected the busy period of corporate activity for the company, in which it raised £48.9m to part fund the CAL acquisition (which took 5.6p off the NAV) and acquired an asset management business (which took 2.2p off the NAV). A modest decline in its portfolio valuation of 0.4% to £540m took 0.7p off the NAV. Underlying funds from operations (UFFO) was 3.7p per share (down from 4.0p due to sales) but still covered its 3p dividend by 123%. The acquisition of CAL was at a 14% discount to its NAV and increases the size of NRR’s portfolio by 65% to £0.9bn. The company said that it expects the transaction to deliver high-teens accretion to UFFO. Following the deal, proforma LTV has increased to 42% (from 21.6% at 30 September 2024). The company said sales of £30m would get the LTV below 40%.
  • Regional REIT (RGL) has reduced its debt with the repayment of £33.4m of borrowings, ahead of schedule. The repayment is £7.1m above the expected £26.3m earmarked from the July 2024 equity capital raise. The additional repayment has been sourced from the property disposal programme. The aggregate company borrowings have now reduced to £319.9m (as at 11 December 2024). This equates to a LTV of 49.4% on the portfolio value at 30 June 2024.

We also have:

Henderson European successfully navigates tricky markets

GCP Infrastructure restarts buybacks as it eyes more disposals

 

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