Disclosure – Non-Independent Marketing Communication
This is a non-independent marketing communication commissioned by Greencoat UK Wind. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.
- Greencoat UK Wind (UKW) released its NAV update on 29/01/2024. The trust announced a NAV per share of 164.1p per share as at 31/12/2024, marking a 5.4% total return for the renewable infrastructure fund over the prior 12 month period.
- The trust increased its target dividend to 10p for 2024. This marks a 14.2% increase over the prior target, far in excess of the trust’s objective of increasing dividends in line with RPI-linked inflation (December 2023 RPI was 5.2%).
- As announced in October, UKW increased its Q4 dividend to 3.43p per share. Dividend coverage for 2023 stood at 2.1x, giving the managers ample room to reinvest income for capital growth as well and continue the trust’s total-return strategy.
- A key driver of performance was the inclusion of Renewable Energy Guarantees of Origin (REGOs) for the first time. However, strong cash generation in the portfolio also supported NAV growth over the period.The primary detractors from performance were lower forecast short term power prices and lower forecast inflation assumptions.
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