The Renewables Infrastructure Group (TRIG)

[kempiejon]

Thanks for the info daveh.
The dividend announcement was expected, the same as the previous 3Qs, I do hope, again as per previous, the next edges upwards. Unlike the recent sp, my capital was doing OK (covid excepted) for the first few years, since then decline, though if I hadn't seen this post and checked I wouldn't have known it had fallen to below purchase levels.

[daveh]

Thanks for the info daveh.
The dividend announcement was expected, the same as the previous 3Qs, I do hope, again as per previous, the next edges upwards. Unlike the recent sp, my capital was doing OK (covid excepted) for the first few years, since then decline, though if I hadn't seen this post and checked I wouldn't have known it had fallen to below purchase levels.

I wasn't expecting the dividend announcement until the end of the month with the full year results.

Yes the share price of all the renewable infrastructure companies seem to have been badly hit over the last few months, though the big energy produces such as TRIG and UKW less so than the BESS companies such as GRID and GSF. A lot of the share price under performance has been down to what was small premiums to NAV falling to large discounts to NAV. For me TRIG is still sitting at breakeven taking account of dividends, but dividends received now ~ matches capital lost.

I think they (renewable infrastructure trusts) may be a good buy, but may get cheaper before prices start to improve. Maybe we will have to wait to see interest rates coming down before their share prices start to rise back towards NAV.

[kempiejon]

Last year looks like they announced the div in February.
TRIG Renewables Infrastructure Group FTSE 250 1.795p Q1 04-May-23TRIG 04-May-23 Dividend Announcement 11-May-23 30-Jun-23
TRIG Renewables Infrastructure Group FTSE 250 1.71p Q4 02-Feb-23TRIG 02-Feb-23 Dividend Announcement 09-Feb-23 31-Mar-23
https://dividenddata.co.uk/ex-dividend- ... hTerm=TRIG details
https://www.londonstockexchange.com/new ... n/15821859
As you say the sector is in decline, like you the TRIG income has balanced for the capital. I have UKW too.

[daveh]

Final results:
https://www.investegate.co.uk/announcem ... s-/8059673

Highlights

For the year ended 31 December 2023

Strong underlying performance with modest decline in valuation

- Robust pro-forma portfolio EBITDA of £610m1 (2022: £677m) reflecting strong achieved power prices.

- Healthy cash flow generation with dividend cover of 1.6x (2022:1.5x); or 2.8x (2022: 2.6x) before the repayment of £219m of project-level debt.

- 6.9p reduction in NAV per share2 to 127.7p (31 December 2022: 134.6p) driven by lower power price forwards and higher valuation discount rates.

- Power prices trended down during 2023 following reductions in gas prices. Since the balance sheet date, forwards for 2024-2026 have further reduced by c. 20%. Over a five-year horizon, a 10% reduction in power prices would reduce the Company's NAV by 2.2p/share4.

- The weighted average Portfolio Valuation3 discount rate as at 31 December 2023 has increased to 8.1% (31 December 2022: 7.2%), reflecting the higher return environment.

Disciplined capital allocation

- Reduction in project-level gearing to 37% (31 December 2022: 38%), following debt repayment of £219m. Project-level debt is fixed rate and amortises over the subsidy periods.

- Retained cashflows and disposals helped reduce Revolving Credit Facility ("RCF") drawings by £34m. In 2024, the Company expects to be able to reduce RCF drawings to about £150m.

- Construction projects completed, with 301MW of capacity delivered during the year across five projects. All construction spend in 2023 was funded from retained cash flows.

- 2024 dividend target5 set at 7.47p/share, a 4% increase on 2023's achieved dividend of 7.18p/share, balancing the strength of the Company's inflation-correlated cash flows with moderating power prices and inflation.

Opportunity for capital growth

- TRIG has an exclusive development pipeline of 1GW by 2030 from repowering, co-location & extensions and new site developments.

- Investing in development activities offers strong prospective risk-adjusted returns, significantly ahead of the portfolio weighted average discount rate, and provides optionality to take projects forward through build and into operations.

- Investment decisions consider an elevated return hurdle rate, which includes the return offered by the buying back the Company's own shares, portfolio construction and the Company's funding position.

- TRIG has the potential to fund the delivery of the development pipeline without the need for equity issuance, through retained cash, divestment proceeds and structural debt capacity. Company's durable balance sheet and amortising debt is projected to see portfolio gearing reduce to 23% by 2030 on the current portfolio, whilst 38% of the portfolio remains ungeared.

- Operational and technical enhancements deliver capital growth through improving the generation output of TRIG's existing portfolio. Examples include AeroUp, which has delivered a 5% energy yield increase at the initial trial site.

Results look good. Dividend covered by income, dividend to be increased next year. Debt being reduced and cash for new investment coming from retained earnings.

[idpickering]

Thanks for the above. I hold TRIG and topped up my holdings recently. I missed this announcement earlier as I was busy with posting other ones.

Ian.

[daveh]

Sale of Irish onshore windfarm:
https://www.investegate.co.uk/announcem ... rm/8082232

Disposal of an Irish onshore wind farm

TRIG is pleased to announce that it has exchanged contracts for the sale of its 100% equity interest in Pallas, an onshore wind farm located in the Republic of Ireland, for a consideration of €62m. The proceeds from the sale represent a 15% premium to that included in the Company's last published Portfolio Valuation as at 31 December 2023 and will be applied to reduce borrowings under the Company's Revolving Credit Facility.

[daveh]

TRIG sells two onshore windfarms:
https://www.investegate.co.uk/announcem ... s-/8102846

Two Scottish onshore windfarms (Total capacity 32MW) sold for £51m, at a premium to valuation at 31st Dec 23. Proceeds to be used to pay down floating rate debt.

[idpickering]

Announcement of Interim Results for the six months to 30 June 2024.

Cash generation in line with expectations; and modest valuation decline:

· Dividend cover of 1.1x in the period (30 June 2023: 1.7x), or 2.2x before the repayment of £103m of project level debt. TRIG's dividend guidance of 7.47p/share for FY 2024 (4% growth year-on-year) is reaffirmed by the Board.

· 4.3p reduction in Net Asset Value per share to 123.4p as at 30 June 2024 (31 December 2023: 127.7p), predominantly due to lower near-term power price forecasts, lower forecast inflation and below budget generation.

· Generation in the period was 7% below budget including the adverse impact of third-party owned cable outages at two UK offshore wind farms, one of which has been repaired. Remedial works have been scheduled for the second site with commercial protections in place.

· Valuation discount rates unchanged. The weighted average portfolio discount rate increased by 0.2% to 8.3% (31 December 2023: 8.1%), driven by changes in portfolio composition including the acquisition of Fig Power, a UK-based energy projects developer.

· Good cash flow visibility comes from:

o 67% of projected portfolio revenues over the next 10 years being at a fixed price per MWh generated,

o 57% of projected portfolio revenues over the next 10 years being directly linked to inflation, and

o The vast majority of debt being fixed rate and amortising.

Richard Morse, Chair of TRIG, said:

"TRIG continues to offer investors scale, diversification and value. TRIG's attractive dividend, which has been increased by 12.5% over the past five years, is being supplemented by a £50m buyback programme in recognition of the Company's robust cash flows, balance sheet strength and the premium to carrying value achieved by the management team across £210m of successful divestments signed during the past 12 months. TRIG's management team takes a disciplined approach to implementing the Board's capital allocation priorities and actively manages TRIG's balanced portfolio to deliver long-term value to shareholders."

Enquiries

https://www.investegate.co.uk/announcem ... s-/8358213

Also;

Commencement of Share Buyback Programme.

The Renewables Infrastructure Group ("TRIG" or the "Company") announced on 1 August 2024 its intention to commence a share buyback programme (the "Programme") for up to £50m of its issued share capital ("Shares"), following successful divestments completed in the last twelve months and significant progress made to reduce the Company's floating rate borrowings under its Revolving Credit Facility ("RCF"). The Company today announces the commencement of this Programme.

The Board of the Company will keep the Programme under regular review and continue to assess it against its capital allocation priorities, including both attractive investment opportunities and further disposal activities, as well as considering prevailing market conditions.

Details of the Programme

The Programme will commence today and end no later than 31 May 2025, subject to market conditions. Under the terms of the Programme, Shares will be purchased on the London Stock Exchange and/or other trading venues1 for subsequent repurchase by the Company. Repurchased Shares will be held in Treasury.

The Programme will be executed under the authority granted by shareholders at the TRIG annual general meeting on 15 May 2024 to acquire up to 372,523,170 shares, equating to c.14.99% of the issued share capital at the time.

The Company has entered into a non-discretionary arrangement with BNP Paribas S.A. and Investec Bank plc, which will enable the purchase of ordinary shares for the Programme to continue through closed periods. Any purchase of shares during a closed period pursuant to the Programme shall be made independently of the Company.

Any purchase of ordinary shares pursuant to the Programme will be announced no later than 07:30 am on the business day following the calendar day on which the purchase occurs.

https://www.investegate.co.uk/announcem ... me/8358420

And;

Interim Dividend

The Renewables Infrastructure Group Limited (the "Company") is pleased to announce the second quarterly interim dividend in respect of the three month period to 30 June 2024 of 1.8675 pence per ordinary share (the "Q2 Dividend"). The shares will go ex-dividend on 15 August 2024 and the Q2 Dividend will be paid on 30 September 2024 to shareholders on the register as at the close of business on 16 August 2024.

https://www.investegate.co.uk/announcem ... on/8351894

Ian (I hold).

[daveh]

dividend declaration:
https://www.investegate.co.uk/announcem ... on/8536157

The Renewables Infrastructure Group Limited (the "Company") is pleased to announce the third quarterly interim dividend in respect of the three month period to 30 September 2024 of 1.8675 pence per ordinary share (the "Q3 Dividend"). The shares will go ex-dividend on 14 November 2024 and the Q3 Dividend will be paid on 31 December 2024 to shareholders on the register as at the close of business on 15 November 2024.

[daveh]

An analysis of TRIG by Kepler released today:
https://www.trustintelligence.co.uk/inv ... edium=news

Bear in mind that these reports are not independent of the company on which they are reporting:

For:

A high yield of 8.2% from a cash-covered dividend, with the potential for NAV growth
High quality diversified portfolio, bolstered by 1GW development pipeline, which is uncorrelated to equity markets, and scores well on ESG matters
Discount may provide an accelerant to NAV returns, if appetites return to the sector

Against:

Discount to NAV may persist for some time
Dividend cover not as high as that of funds that are not amortising, i.e. paying down debt
Macro uncertainty (e.g. lower power price forecasts and high interest rates) have provided a headwind to the NAV, and may persist

Some interesting comments - like output is down this year due to poor wind conditions across Europe, plus problems at their larger sites. Debt is likely to be higher than forecast and dividend cover is likely to be lower than forecast this year as a result, but should improve next year back to forecast. Unfortunately I would need to create an account to read any more of the report bar the first page.

[Gerry557]

I think the boss of the BoE was also saying that the NI tax rises will likely see higher for longer interest rates.

So below average weather should mean some better weather ahead unless we get more bad weather and the average starts to move lower. It might allow some compounding whilst the price is in the doldrums and the discount is high.

[daveh]

revolving credit facility reduced and refinanced at lower rates:

https://www.investegate.co.uk/announcem ... ed/8723558

TRIG announces that the Company has refinanced and reduced the size of its multi-currency Revolving Credit Facility ("RCF"). The renewed RCF of £500m has been made available to TRIG for a three-year committed term expiring 31 March 2028 at improved pricing compared to the previous £600m facility. This refinancing supports the Company's strong balance sheet. RIG announces that the Company has refinanced and reduced the size of its multi-currency Revolving Credit Facility ("RCF"). The renewed RCF of £500m has been made available to TRIG for a three-year committed term expiring 31 March 2028 at improved pricing compared to the previous £600m facility. This refinancing supports the Company's strong balance sheet.

[daveh]

Annual results:
https://www.investegate.co.uk/announcem ... s-/8750538

Highlights

For the year ended 31 December 2024

Resilient underlying performance; decrease in portfolio valuation driven by externalities

- Robust pro-forma portfolio EBITDA of £493m1 (2023: £610m), reflecting more normalised power price levels in GB and Europe compared to highs of 2022 / 2023.

- Healthy cash flow generation despite third-party transmission-related outages, with gross cash cover of 2.1x (2023: 2.8x) and net dividend cover of 1.0x (2023:1.6x), after the repayment of £206m project level debt.

- 11.8p reduction in NAV per share2 to 115.9p (31 December 2023: 127.7p) driven by a reduction in power price forecasts, adjustments to operational assumptions, the impact of third-party grid outages and higher valuation discount rates.

- The weighted average Portfolio Valuation3 discount rate as at 31 December 2024 has increased to 8.6% (31 December 2023: 8.1%), largely reflecting higher return rates in the UK and changes in portfolio mix.

Capital allocation priorities remain balance sheet management and cash returns for shareholders

- Sale of four windfarms: Little Raith, Forss, Pallas and partial stake in Gode 1 for a total £185m, at an average premium of >10%.

- Overall gearing reduced by £340m (following post year end completion of the Gode disposal)4, with project-level gearing of 37% (31 December 2024: 37%). Project-level debt is fixed rate and is scheduled to be systematically repaid within the term of contracts with fixed revenue per unit generation.

- Share buyback programme tripled from £50m to £150m, representing approximately 8% of TRIG's shares in issue based on the share price as at 21 February 2025. 36m shares bought back to date for a total consideration of £33m.

- 2025 dividend target5 set at 7.55p/share, a 1.1% increase on 2024's achieved dividend of 7.47p/share.

Inherent value with clear visibility

- High levels of cashflow visibility, with 80% of projected revenues in 2025 at a fixed price per unit of generation and 60% of forecast revenues over the next 10 years directly linked to inflation indices.

- Over £300m of further divestments and financings being progressed to fund the expanded buyback programme, reduce floating-rate debt and meet investment commitments.

- The current share price implies a 10% dividend yield5 and a base case annualised return of 12%, providing a 7% and 9% equity risk premium as compared to UK and European risk-free rates, respectively

[daveh]

and a change to the management agreements:

https://www.investegate.co.uk/announcem ... ma/8750585

So the fees paid will be determined by a combination of the share price and net asset value, which in the present situation means they are reducing by 28%

If it goes back to when I first bought and TRIG were sitting at a small premium then the fees would be higher. I wonder if they will change if they ever go back to that small premium to net asset value - as a holder it would be nice if they did.

They are also incentivising the managers by paying fees if they make sales of assets (or the whole company) above NAV of 3% of the value achieved above NAV. Total fees can't be higher than they would have been under the old system.

[daveh]

Change to management fee structure and addition of a continuation vote to the AGM:

https://www.investegate.co.uk/announcem ... te/8796994

Much the same as a number of the other renewable ITs with the shares at a significant discount to NAV the management fee is to be determined by the average of the share price and NAV, which will reduce the fees paid.

And they plan to add a resolution to the AGM to amend their Articles of Association such that in future they will hold a continuation vote if the share price has traded at an average discount to NAV of more than 10% in the preceding year.

[daveh]

Dividend declaration:

first quarterly interim dividend in respect of the three month period to 31 March 2025 of 1.8875 pence per ordinary share (the "Q1 Dividend"). The shares will go ex-dividend on 15 May 2025 and the Q1 Dividend will be paid on 30 June 2025 to shareholders on the register as at the close of business on 16 May 2025.

Slight increase on last year.
No Scrip alternative if discount more than 10%