NESF said the generation outperformance of its portfolio translated into additional revenues of £4.8 million. Image: Andreas Gücklhorn (Unsplash).
Next Energy Solar Fund (NESF) has confirmed that its portfolio achieved a generation outperformance of 3.8% against budget for 12 months ended 31 March 2023.
The specialist solar and battery fund said that this translated into additional revenues of £4.8 million in another strong year for NESF.
Overall, the company declared that its net asset value (NAV) stood at £674.4 million for the end of the financial year. This included a total installed capacity of 865MW and 99 operating solar assets.
Despite this, the firm also highlighted a recently announced Capital Recycling Programme which aims to capture value from the divestment of a 236MW portfolio of subsidy-free UK solar assets.
Although the fund plans to disinvest in solar, NESF is actively engaging with investors to increase its energy storage investment policy limit from 10% of Gross Asset Value up to 25%. It confirmed that talks have been positive on the subject.
NESF also increased its dividend target for the financial year ending 31 March 2024 by 11% as growth beckons for the tenth consecutive year. This is underpinned by its projected dividend cover of 1.3x to 1.5x for the financial year.
The specialist solar fund increased its target dividend to 8.35p per ordinary share, up 11% from the target the year previous which stood at 7.52p per ordinary share.
The company declared total dividends since IPO of £305.8m or 55.72p per share. The increase in the dividend target represents the tenth consecutive year that the company has done so with the firm expecting further growth in the coming years.
“This quarter has been one of key strategic importance for the Company. We announced several value accretive programmes to provide growth, value, and stability for shareholders. We were the first fund in the renewable investment company space to announce a capital recycling programme, aimed at reducing gearing, securing future growth optionality, and providing flexibility for a share buyback programme,” said Kevin Lyon, chairman of NextEnergy Solar Fund.
“The company identified an issue with automated reports produced by the accounting software which was quickly addressed and shared with the market today. Transparency remains a key theme for the Board as we continue to engage and listen to our shareholders. The company has an exciting future ahead of it and offers excellent value to shareholders, evidenced by the Board's decision to increase the dividend target by 11%, one of the largest increases in the sector.”
In October 2022, NextEnergy Solar Fund acquired a “strategic portfolio” of battery storage development projects located in a grid-congested area in the East of England.
The firm said it acquired the 250MW portfolio of two-hour duration (500MWh) battery projects from an undisclosed developer. The value of the deal was disclosed at £32.5 million.
On 26-27 June, Solar Power Portal's publisher Solar Media will host its annual UK Solar Summit in London. This year, the Summit will explore solar’s role in the UK’s energy mix, analysing how this will change as we draw closer to the Government’s net zero target. For more information, please visit the UK Solar Summit website here.