International Public Partnerships performs steadily, reaffirms dividend target

(Sharecast News) - Infrastructure investor International Public Partnerships (INPP) reaffirmed its 2024 dividend target of 8.37p per share in a portfolio update on Monday, making for a 3% increase from 2023 and maintaining its record of annual dividend growth since its 2006 initial public offering. The FTSE 250 firm said that from 2025, dividend payments would shift from semi-annual to quarterly, enhancing income predictability for shareholders.

However, macroeconomic factors such as rising UK government bond yields and sterling strength were expected to modestly impact its net asset value (NAV) per share, which stood at 149.5p as of 30 June.

INPP said its share buyback programme, launched to address its persistent NAV discount, had seen £38m worth of shares repurchased, with plans to extend the £60m programme into the first quarter of 2025.

The company indicated it would consider expanding the initiative should significant NAV discounts persist.

Capital recycling efforts yielded over £40m in proceeds since 1 July, including the sale of its stakes in the Three Shires PPP portfolio and a partial divestment of Family Housing for Service Personnel investments.

New investments included £15m to support BeNEX's acquisition of Abellio's German rail operations and £6m towards long-standing commitments in health and transport projects.

Operationally, the East Anglia One Offshore Transmission Owner had resumed full capacity following cable repairs, with no expected financial impact due to warranty protections.

Additionally, the Thames Tideway began partial operations, preventing substantial sewage pollution during London's heavy rainfall in September, with full commissioning on track for 2025.

The company also addressed the gradual handback of public-private partnership (PPP) assets, starting with the Hereford and Worcester Courts in 2025, while ensuring readiness for future transitions across its portfolio.

Looking ahead, INPP highlighted robust demand for infrastructure investment across its markets, supported by financial constraints and increasing public-private collaboration opportunities.

Recent UK policy shifts, including a focus on healthcare, education, and transport infrastructure, were cited as promising areas for private capital participation.

"INPP's portfolio has continued to perform well during the period, generating consistent financial returns whilst facilitating the delivery of essential public services," said chair Mike Gerrard.

"We continue to make progress with our initiatives to optimise the portfolio, address the discount to net asset value at which the Company's shares currently trade, and deliver value to shareholders.

"This includes the company making additional divestments during the period which has increased the amount realised over the past 18 months to over £260m, equivalent to c.10% of the portfolio by value."

Gerrard added that the firm had also continued to buy back shares under the previously-announced share buyback programme of up to £60m.

"We remain confident in the company's ability to navigate macroeconomic uncertainties, underpinned by the performance of its investment portfolio."

At 0811 GMT, shares in International Public Partnerships were down 0.32% at 125.6p.

Reporting by Josh White for Sharecast.com.