27th Nov 2019 10:17
(Alliance News) - Sequoia Economic Infrastructure Income Fund Ltd on Wednesday lifted its dividend target after a strong first half boosted by positive market movements for many investments and gains from issuing shares at a premium to net asset value.
As at September 30, Sequoia Economic Infrastructure's net asset value per share was 105.30 pence, up 1.8% from 103.41p on March 31. During the six month period, the firm paid dividends of 3.0625p per share, up 2.1% from 3.0p the year before, for a total NAV return of 4.9% .
"This performance is predominantly the result of four factors: the portfolio consists of stable, cash-generative assets which generate an annual return of over 8%; costs and expenses are moderate with an ongoing charges ratio of just under 1%; positive market movements on many of the company's investments; and a total gain of just under 1% from issuing shares at a premium to NAV during the first half of the financial year," Sequoia Economic Infrastructure explained.
After the strength of its first half, the company has opted to raise its per share dividend target for its financial year ending March 2020 by 4.2% to 6.25p from 6.00p.
Chair Robert Jennings said: "The strength of the fund's performance in the four-and-a-half years since listing means that we have been able to raise our targeted dividend pay out for the first time. Even after the substantial 4.2% increase in this target, net asset value per share grew by 1.8% over the half year. Gross assets under management increased by over GBP300 million, reflecting substantial and attractive opportunities to debt finance economic infrastructure providers. The board remains confident in the business model and strategy."
Shares in Sequoia Economic Infrastructure were down 0.2% at 116.73p in London on Wednesday morning.
By Anna Farley; [email protected]
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