27th Jun 2024 10:46
(Alliance News) SDCL Energy Efficiency Income Trust PLC on Thursday lamented high inflation and interest rates as it announced a lower net asset value per share.
SDCL Energy Efficiency Income Trust invests in assets in the energy efficiency sector, such as electric vehicle charging infrastructure and geothermal and biogas projects.
SDCL Energy said net asset value per share fell 11% to 90.5 pence per share at March 31, when its financial year ended, from 101.5p a year prior.
NAV total return for the year that ended March 31 was negative 4.7%, widening from negative 0.9% in financial 2023.
Despite this, the company said that its portfolio valuation increased 1.5% to GBP1.12 billion as at March 31, from GBP1.00 billion a year prior.
The company said the aggregate dividend for financial 2024 was 6.24p per share, up 4.0% from 6.0p paid out a year prior.
SDCL Energy Efficiency said: "The last year has been characterised by continued relatively high inflation and interest rates. This has put downward pressure on valuations of income streams and asset values in the infrastructure sector."
"Signs of lowering inflation and hopes for one or more interest rate cuts by central banks during 2024 collided with stubborn inflation numbers in the last quarter of the company's financial year, limiting the opportunity to reduce discount rates in the short term.
"Market uncertainty was accompanied by geopolitical instability as the wider ramifications of the Israel-Hamas and the Russia-Ukraine conflicts continued to impact supply chains and global capital markets."
The firm added that the UK investment trust market has been under pressure, lowering its share price.
Looking ahead, Chair Tony Roper said: "As the world seeks to address the practical challenges of the energy transition and efforts to decarbonise, energy markets and their supply chains face scarcities and price volatility.
"In this context, investing in more efficient supply, demand and distribution of energy, which is SEEIT's focus, becomes increasingly important and valuable. We believe that SEEIT remains well positioned to benefit from this opportunity."
SDCL Energy Efficiency shares fell 3.0% to 67.03 pence each on Thursday morning in London.
By Tom Budszus, Alliance News slot editor
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