Published: 20 Jan 2023, 15:07
Octopus Renewables Infrastructure Trust has continued to expand its portfolio over the past year, supporting its dividend payments. Image: Octopus Investments.
Closed end investment company Octopus Renewables Infrastructure Trust has increased its target dividend for the second year in a row.
The Board has now set the target at 5.79p per ordinary share for the financial year from 1 January 2023 to 31 December 2023. This is an increase of 10.5% over the full year 2022 dividend target, and is in line with the Consumer Price Index (CPI).
The company is expecting to fully cover the dividend target by cashflows from its operating portfolio.
“Increasing our annual dividend target by 10.5% for the new financial year reflects the positive progress made by the company to date,” said Phil Austin, chairman of Octopus Renewables Infrastructure Trust plc.
“This has been driven by our diversified portfolio of assets, spanning seven countries and five technologies, from which [48]% of forecast revenues over the next 10 years are explicitly inflation linked. Along with our Investment Manager’s successful delivery of construction projects, the existing operational portfolio has allowed for 546MW of operational capacity to now contribute to ORIT’s dividend cover.”
The company is set to deliver its target dividend for the year ending December 2022 of 5.24p per ordinary share, again utilising cashflows from its operating assets. Its fourth interim dividend for 2022 will be declared later this month.
Octopus Renewables Infrastructure Trust grew its portfolio significantly over the last year, including acquiring a c.68MW ready-to-build solar PV project in Cambridgeshire from AGR Renewables in June. Beyond solar, the company also acquired of a stake in the Lincs offshore wind farm.
As of 31 March 2022, the company’s NAV per share was 104.0p. Over the following months high power prices along with 54% of its portfolio being explicitly inflation linked have boosted this. If these factors were taken into account, NAV per ordinary share would be boosted by c.5-6p, to between 109p and 110p by June.