3i Infrastructure (3IN) has released a pre-close trading update for the year ending 31 March 2025, reporting strong portfolio earnings momentum, successful refinancing activity, and income well ahead of expectations. The company remains on track to deliver its dividend target of 12.65p per share for its 2025 financial year, a 6.3% increase over the prior year, which is expected to be covered 2.5 times by net income.
Portfolio highlights
Total income and non-income cash during the period from 1 October 2024 to 28 March 2025 was £273m, up 163% year-on-year, largely driven by refinancing distributions.
- Valorem sale completed in January for net proceeds of €310m, a 31% uplift to the pre-transaction valuation and delivering a 21% gross IRR over the life of the investment.
- TCR, Oystercatcher, and Future Biogas all closed successful refinancings on improved terms, enabling sizeable distributions to 3IN.
- TCR continues to grow, expanding to 234 airports and securing major commercial wins, including an electric GSE contract at JFK.
- Infinis delivered strong EBITDA, outperforming through robust captured methane output and accelerating its solar pipeline.
- GCX and Tampnet are benefiting from high demand for subsea capacity, with GCX committing $34m to expand its network and Tampnet continuing to build a strong project pipeline.
- DNS:NET reached a milestone of 100k paying customers with ARPU and penetration ahead of expectations. 3iN invested a further €24m in January to support continued rollout.
Challenges and mitigations
While the majority of the portfolio is performing in line with or ahead of expectations, SRL and Ionisos have faced headwinds:
- SRL saw a downturn in demand from local authorities and fibre segments, with rising labour costs further pressuring margins. A new management team is focused on cost control and turnaround.
- Ionisos experienced some unplanned downtime and weakness in its industrial division, though its core healthcare segment remains robust.
Balance sheet and capital allocation
Proceeds from the Valorem sale and refinancing distributions have been used to repay €406m of drawings on the company’s £900m RCF, leaving expected drawings at €310m as at 31 March 2025, with a cash balance of around £4m.
Outlook
Commenting on the update, Bernardo Sottomayor, managing partner and head of European Infrastructure at 3i Investments, said: “We continue to see earnings momentum in the portfolio, driven by our strategic focus on growth within our existing companies. Our proactive debt management and strong operational performance have enabled income significantly ahead of expectations. We are confident in delivering another strong year of performance and are well-positioned for further value creation.”
The company reaffirmed its long-term focus on investing in infrastructure businesses in structural growth markets, while maintaining a disciplined capital allocation policy.
