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- HICL Infrastructure update covers Affinity Water Ofwat proposal
HICL has published an interim update statement, covering the period from 1 April 2024 to 24 July 2024. It says that it is on track to deliver its target 8.25p dividend for the year.
The revolving credit facility (RCF) was repaid in May 2024 and the company began a £50m buyback programme. 7,050,000 shares have been bought back so far. However, the discount is still 21.2%, so there is more to do.
[One investment that I have been uncomfortable with for a while is Affinity Water. On this, HICL says:]
Ofwat published its draft determination for PR24 (2025-2030) for Affinity Water in the period:
[I cannot help thinking that the new government will encourage Ofwat to be a lot tougher on these companies than the last one was.]
There is a dispute over taxes on road tolls in France which affects HICL’s investment in the A63 motorway. Here it says: the Conseil d’Etat has agreed that the Conseil Constitutionnel will review the legal challenge against the new tax on long-distance transport infrastructure with a decision expected in September 2024. If the challenge fails the company expects any increase in costs to be compensated through higher tolls. Nonetheless, if the levy were to be imposed without a flow through into tolling, the impact on HICL’s valuation would be immaterial.
HICL : HICL Infrastructure update covers Affinity Water Ofwat proposal