Triple Point Energy Transition PLC said on Wednesday that an ‘orderly realisation of assets’ is the only course of action following a ‘sustained discount’ to net asset value.
The investment trust, which focuses on green-transition infrastructure projects, says it has been ‘been significantly impacted by the wider macro-environmental pressures being experienced by a large number of its sector peers.’ Alongside ‘sub-optimal’ liquidity, this has led to a ‘notable gap’ between the company’s NAV and its market valuation since January 2022.
The company’s NAV per share was 95.09 pence for the six months ended September 30, down from 100.26 pence year-on-year. Triple Point Energy’s share price was up 14% at 65.56 pence each in London on Monday morning.
The weighted average discount rate for the company’s portfolio of investments has increased to 7.3%, up from 6.6% in March. Triple Point says this has ‘restricted the company’s ability to raise further capital and realise the benefits that come from greater scale’.
In response to ‘shareholder frustration’ at this persistent NAV discount, Chair John Roberts said: ‘In view of the likelihood of continued market volatility and the negative impact that will have on our future ability to scale up, we have concluded that the best option to optimise shareholder value is to initiate an orderly realisation of the group’s assets and return capital to investors, and, as such, will be making this recommendation to shareholders in our forthcoming circular.’
Triple Point estimates the value of its total portfolio at £92.4 million as of September 30, up from £84.1 million year-on-year.
Triple Point will be convening a general meeting to seek approval for a a revised investment policy ‘to facilitate the orderly realisation of the group’s assets and return of capital to shareholders’. Details of the proposals and meeting will be given to shareholders in the first quarter of 2024.
The company has also received an offer in relation to the sale of its debt facility provided to a subsidiary of Virmati Energy Ltd for the full carrying value of the loan. So far, around £10.1 million has been drawn under the facility of £37 million committed. Details regarding the transaction will be announced as appropriate ‘in due course’.
Triple Point declared an interim quarterly dividend of 1.375 pence per share for the period ended September 30. Dividend per share was unchanged year on year and the company is targeting total dividends of 5.50 pence each for the financial year ending March 31, 2024.
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