10th Sep 2020 10:35
(Alliance News) - International Public Partnerships Ltd on Thursday said its net asset value per share fell in the first half of 2020, reflecting an expected hit from the Covid-19 pandemic.
The public infrastructure projects and businesses investor's net asset value as at June 30 was 149.2 pence, down from 150.6p at the end of 2019.
International PPL said: "The company has taken a cautious approach and sought to reflect the anticipated financial impact of Covid-19 within its 30 June 2020 cash flow forecasts and valuations. This cautious approach has contributed to a 0.7% decrease in net asset value to GBP2.41 billion."
The risks and implications of the pandemic are most significant for Tideway in the UK, which is building a 25-kilometre super sewer under the river Thames, and Diabolo Rail Link in Belgium.
Tideway's progress on the sewer slowed due to new working protocol and safety measures to prevent the spread of the virus. In August. Tideway published an update stating that the cost of the project could rise to around GBP4.1 billion from around GBP3.9 billion with the completion date delayed to the first half of 2025. International PPL is a 16% Tideway shareholder.
The Diabolo Rail Link has experienced materially lower passenger lowers in 2020 so far versus previous year due to Covid-19.
Of Daiabolo, International PPLC said: "In the event of prolonged under-performance without remedial action, the company is unlikely to receive distributions from this investment for some time and a technical default may be triggered under the terms of the debt secured on that investment."
International PPL reported GBP35.4 million pretax profit for the six months ended June 30, less than half its GBP83.7 million profit the year before.
International PPL declared a half-year dividend of 3.68 pence per share, up from 3.59p per share the year before. It also reaffirmed its 7.36p per share dividend target for 2020 and announced a 7.55p per share 2021 target. These targets would represent around a 2.5% increase compared to proceeding distributions and would align with its growth target.
Chair Michael Gerrard said: "Many aspects of modern society have been tested by the Covid-19 pandemic and our social and public infrastructure is not immune. However, the company's portfolio continues to show considerable resilience. As a result of the high-quality, diversified investments carefully originated and actively managed by our investment adviser's dedicated team, we have continued to generate consistent and growing returns for our shareholders.
"The near-term uncertainty due to the implications of Covid-19 will likely result in some short to medium term headwinds for some of our investments, but together with our track record of successfully solving asset management issues and the contractual protections we have in place to protect downside risks, I remain fully confident in the company's ability to generate positive outcomes for all our stakeholders."
Shares in FTSE 250-listed International PPL were up 0.6% at 161.91p in London on Thursday morning.
By Anna Farley; [email protected]
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