REG - Ecofin US Renewables - Q1 2024 Net Asset Value

Ecofin US Renewables Infrastructure TrustAnnouncement

17/06/2024 07:15

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RNS Number : 5886S  Ecofin US Renewables Infrastr.Trust  17 June 2024

17 June 2024

 

ECOFIN U.S. RENEWABLES INFRASTRUCTURE TRUST PLC

(the "Company")

 

Q1 2024 Net Asset Value

 

The Company announces that its unaudited net asset value ("NAV") as at 31
March 2024 on a cum-income basis was $0.7937per Ordinary Share (31 December
2023: $0.8521) or $109.6 million (31 December 2023: $117.7 million).

The contributors to the changes in NAV were:

·      a $7.16 million decrease ($0.0519 per Ordinary Share) in the Fair
Market Value ("FMV") of investments, principally due to updates in forecast
assumptions and increase in discount rates;

·      a $2.4 million increase ($0.0175 per Ordinary Share) due to a
decrease in the deferred tax accrual, largely driven by the decrease to FMV of
investments; and

·      a $3.3 million decrease ($0.0241 per Ordinary Share) in cash and
accrued financial assets, primarily driven by lower than expected energy
production and revenue accrual relating to temporarily low availability and
corrective maintenance actions at various sites, fund expenses, and interest
expense on the Company's Revolving Credit Facility.

 

The weighted average pre-tax discount rate which was provided by the Company's
valuation service provider and used to determine the FMV of investments is
7.5% unlevered.

The Company's dividend for the quarter ended 31 March 2024 has been kept at
0.70 cents per share. Several factors contributed to this decision, including
lower than expected revenue noted above, higher than usual expenses, in part
related to the strategic review, and slower progress than originally
anticipated in bringing the Whirlwind asset back to full production following
the damage last year to the Matador substation in Texas.  As previously
announced, the Company had agreed with American Electric Power ("AEP"), the
owner of the Matador substation, to restore generation from Whirlwind through
a new transmission line to Paducah, another substation owned by AEP.
Re-energisation of Whirlwind took place on 8 December 2023 and the windfarm
has been generating successfully, albeit at a reduced voltage, since that
time.  However, in recent weeks, because of oscillation issues on the new
Paducah transmission line, ERCOT (the grid operator in Texas) has taken the
decision to curtail Whirlwind to 25MW vs an expected interim capacity level of
50MW. Whirlwind will not be restored to 50MW until the source of the
oscillation issue has been identified and rectified.  Whirlwind should return
to its full production level of 59MW when the newly rebuilt Matador substation
comes online, expected to be in Q4 2024 or Q1 2025.

As announced on 8 September 2023, the Board has been undertaking a review of
the Company's strategy -- focusing on a sale of the Company's assets. If
successful, the sale of assets is expected to result in cash being returned to
Shareholders in connection with a winding up of the Company. Marathon Capital
("Marathon"), financial adviser to the Board, has conducted a wide-ranging
exercise to identify potential buyers for the Company's portfolio of assets.
Specific discussions and negotiations are ongoing but have been taking longer
than anticipated..

For further information, please contact:

 

 Ecofin Advisors, LLC (Investment Manager)             +1 913 981 1020

 Edward Russell

 Eileen Fargis

 Michael Hart

 Stifel ( Corporate Broker)                            +44 20 7710 7600

 Edward Gibson-Watt

 Rajpal Padam

 Madison Kominski

 Apex Listed Companies Services (UK) Limited (Company  +44 20 3327 9720
 Secretary)

 Martin Darragh

 Jennifer Thompson

Further information on the Company can be found on its website
at https://uk.ecofininvest.com/funds/us-renewables-infrastructure-trust-plc/
(https://uk.ecofininvest.com/funds/us-renewables-infrastructure-trust-plc/) .

 

The Company's LEI is 2138004JUQUL9VKQWD21.

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