Ecofin Global Utilities upbeat on solid full-year returns

(Sharecast News) - Ecofin Global Utilities and Infrastructure Trust reported a net asset value total return of 15% for the year ended 30 September on Friday, and a share price total return of 16.6%, as it pointed to earnings growth across listed infrastructure driven by rising power demand and capital expenditure. Net assets attributable to shareholders rose to £256.6m from £243.2m, lifting NAV per share to 245.65p from 221.68p, while the share price ended the year at 218.0p, leaving the shares on an 11.3% discount to NAV.

The board raised its quarterly dividend by 5.9% to 2.25p per share, effective from the payout due in February, taking the annualised rate to 9p per share.

It said the increase "exceeds the rate of consumer price inflation for the year and ensures that our dividend has grown above the rate of inflation since your company's inception," and that the new rate implied a 4.1% yield based on the year-end share price.

For the year just ended, revenue return per share increased to 7.45p from 7.17p, while dividends paid were 8.425p versus 8.10p a year earlier.

Investment income rose to £12.0m from £11.8m, and the company posted a total return after tax of £32.9m, down from £50.3m in the prior year, reflecting lower gains on investments.

Chairman David Simpson said performance was positive across sub-sectors and regions, with transportation infrastructure and integrated utilities leading contributions, and added that gearing was used actively to enhance returns.

Prime brokerage borrowings fell to £25.5m from £34.6m, and gearing on net assets reduced to 10.2% from 14.2%; the company said gearing contributed about 1.8% to shareholder returns over the reporting period.

"I am pleased to report that your company performed well for the year to 30 September 2025," Simpson said, arguing the investment trust structure had benefited shareholders through gearing, buybacks and "attractive and growing dividends."

The trust also continued to repurchase shares to manage its discount, buying back 5.28 million shares during the year, equal to 4.8% of the opening share count, for £10.5m, which it said enhanced NAV per share by 0.8%.

It added that a further 10.56 million shares were repurchased after the year end to the close of business on 9 December, enhancing NAV per share by a further 0.5%.

"Your board takes the view that, having issued new shares when they were trading at a premium to NAV per share, it is our duty to buy shares back when they trade at a material discount," Simpson commented.

Portfolio manager Jean-Hugues de Lamaze said the portfolio recovered strongly after a volatile start to the second half following US tariffs announced on 2 April, and argued listed infrastructure remained undervalued relative to history, broader markets and private assets.

"Listed infrastructure is still undervalued by historical standards, relative to broad market averages and compared with valuations of private infrastructure assets," he said.

"The portfolio's companies will, we believe, continue to grow their earnings, almost irrespective of the economic backdrop, helped by the proportion of their revenues which is fully contracted or regulated."

In the manager's review, Europe ex-UK and Asia Pacific ex-Japan were standout regions, while transportation infrastructure and integrated utilities were the strongest sub-sectors; the report highlighted a series of long-term power agreements involving hyperscalers, including nuclear and hydro contracts, as price markers for parts of the portfolio.

The company also flagged board and operational changes, with Simpson due to step down as chairman at the March annual general meeting and be succeeded by Susannah Nicklin, while David Benda joined as a non-executive director from 1 November this year.

Frostrow Capital was appointed as AIFM from 1 July and also took on company secretarial, administration and investor relations responsibilities, while Montfort Communications was appointed as public relations adviser.

The trust said it would stop producing printed half-year reports, while continuing to make annual reports available in print, and confirmed its AGM would be held on 5 March in London, with a presentation from de Lamaze.

Looking ahead, the chairman reiterated confidence in sector tailwinds from clean energy, digitalisation and ageing infrastructure, and said valuations remained compelling across portfolio opportunities.

At 0956 GMT, shares in Ecofin Global Utilities & Infrastructure Trust were up 1.22% at 240.2p.

Reporting by Josh White for Sharecast.com.