LEI:
213800IE1PPREDIIZB62
ATRATO ONSITE ENERGY
PLC
INTERIM RESULTS
FOR THE SIX MONTHS ENDED 31 MARCH 2024
UK'S LEADING PLATFORM FOR
COMMERCIAL AND INDUSTRIAL (C&I) SOLAR
Atrato Onsite Energy plc (the
"Company" or "ROOF") is pleased to announce its
unaudited interim results for the six months ended 31 March 2024
(the "Period").
Results presentation today
There will be a virtual
presentation for sell side analysts at 8.30 a.m. today, 20 June
2024.
The live presentation will be
viewable online with Q&A function for anybody wishing to join.
The webcast can be accessed here: https://stream.brrmedia.co.uk/broadcast/6655a64a173fd460b81149cd
The results presentation will be
available to view in the Investor Centre section of the Company's
website following the presentation.
Key metrics
|
|
|
As at
31 March
2024
(unaudited)
|
As at
31 March
2023
(unaudited)
|
As at
30
September
2023
(audited)
|
Gross Asset Value ("GAV")
1
|
|
|
210.8m
|
140.7m
|
138.1m
|
Net Asset Value ("NAV")
|
|
|
135.1m
|
140.7m
|
138.1m
|
NAV per share[1] (p)
|
|
|
90.0p
|
93.8p
|
92.0p
|
Dividends per share (p)
|
|
|
2.63p
|
2.52p
|
5.0p
|
Key metrics in the period
|
|
|
Six months
ended
31 March
2024
|
Six months
ended
31 March
2023
|
12 months
ended
30
September
2023
|
NAV total return (%)
|
|
|
0.7%
|
3.5%
|
4.6%
|
Generation (GWh)
|
|
|
24.0
|
8.8
|
36.3
|
Tonnes of CO2
avoided
|
|
|
5,300
|
2,000
|
7,627
|
Ongoing charges
ratio1
|
|
|
1.9%
|
1.6%
|
1.8%
|
Continued growth in our commercial
and industrial solar platform
· Increased capacity from 147MW to 182MW at Period end and
204MW post balance sheet[2]
o 34MW operational private wire portfolio acquired in October
2023 ("ASG portfolio")
o 7MW operational private wire portfolio acquired in May
2024
o 2MW financial close on three further Tesco stores in May
2024
o 13MW mixed operational portfolio acquired in June
2024
· 4
projects comprising 50MW of installation assets fully energised in
the Period
· 74%
fully operational portfolio and 26% under
installation[3] -
set to complete July 2024
· Target dividend of 5.5 pence (March 2023: 5.0 pence) per
share reaffirmed
o An increase of 10% on the previous year
o 1.41x covered from expected earnings[4]
Generating highly
contracted index-linked long income
· 93%
of revenue is contracted under long term PPA or
subsidy3
· 11-year average unexpired contracted term, longest in the
sector3, [5]
· 3.9%
sensitivity to merchant prices, lowest in
the sector[6]
· 91%
of revenues subject to annual index linked uplifts, 48% are
uncapped RPI or CPI3
Robust balance sheet
· Gearing of 36% as at 31 March 2024
o £30 million drawn under the Revolving Credit Facility
("RCF")
o £45.7 million of term debt, acquired as part of the ASG
portfolio
o 3.8% weighted average cost of debt, 60% of drawn debt
fixed
· RCF
facility increased to £40 million with a further £10 million
available via accordion
Portfolio valuation decline
reflects the impact from higher market discount rates
· Portfolio valued at £134.4 million as at 31 March 2024
(September 2023: £99.2 million), verified by independent
valuer
· 2.0
pence decrease in NAV per share to 90.0 pence (September 2023: 92.0
pence)
· NAV
decrease impacted by a 50-bps increase in the weighted average
discount rate to 7.9% (30 September 2023: 7.4%), predominantly due
to RCF debt being drawn
Sustainability at
our core[7]
· Our
purpose is to build a clean energy portfolio that generates
sustainable returns and contributes to our net zero
future
· Forecast 191GWh annual clean energy generation providing an
estimated[8]:
o 41,000 tonnes of carbon avoided[9]
o 71,000 equivalent homes powered by clean
energy9
· The
Company became a member of the Solar Stewardship Initiative
("SSI"), an industry initiative established by SolarPower Europe
and Solar Energy UK which aims to drive a more responsible,
transparent and sustainable solar value chain
Juliet Davenport, Chair of Atrato Onsite Energy plc
commented:
"Our focus on C&I solar has
enabled us to assemble a high quality diversified solar portfolio,
offering one of the longest and most secure income profiles in the
UK listed solar sector with one of the lowest sensitivities to
volatile merchant power prices.
We are proud to be the partner of
choice for some of the largest blue-chip corporations in the UK to
help them deliver on their net zero targets."
About the Company
Atrato Onsite Energy plc (LSE:
ROOF) is an investment company focused on clean energy generation
with 100% carbon traceability. The Company specialises in UK
commercial and industrial solar, helping its corporate clients
achieve net zero and reduce their energy bills.
The Company aims to provide
investors with attractive capital growth and long dated,
index-linked income, targeting an annualised dividend 5.5 pence per
share for FY2024 and an annual NAV total return of 8 -
10%.
Atrato Partners Limited is the
Company's Investment Adviser.
Further information is available
on the Company's website www.atratorenewables.com
For further information please contact
Atrato Partners Limited
Gurpreet
Gujral
ir@atratopartners.com
Christopher
Fearon
+44 (0)77 959 75560
Stifel Nicolaus Europe Limited
Mark
Young
+44 (0)20 7710 7600
Rajpal Padam
Madison Kominski
Greenhouse
Communications
atrato@greenhouse.agency
Jessie
Wilson
+44 (0) 7763 540 629
CHAIR'S STATEMENT
I am pleased to present the
unaudited interim results for the Company for the six months ended
31 March 2024.
We have continued to build on our
position as the leading C&I solar platform in the UK. As of
today, we have increased our solar PV capacity to 204MW and our GAV
to £216.3[10] million, furthering our aim
of generating sustainable shareholder returns whilst contributing
to a net zero future.
We are witnessing remarkable
changes in the UK's electricity markets and how they are supplied.
The emergence of renewables as a significant contributor to
Britain's electricity mix as we near net zero goals, and the
accelerating trend in companies choosing to procure their renewable
energy directly from independent generators, means there has never
been more opportunity.
Against this backdrop, we are
proud to be the partner of choice for some of the UK's largest
blue-chip corporations looking to transform, the sustainability,
affordability and security of their energy supply at
scale.
Our pipeline of opportunities
continues to grow, currently at 516MW or a value of c.£429 million
of which 438MW relates to new installation projects. During the
period, we have drawn £30 million under the RCF to fund additional
acquisitions.
In the last six months, we have
concluded our 28MW solar project with Britvic, energising 75% of
its British operations and commercialised under a 10-year corporate
PPA and our 20MW private wire project for Nissan which is expected
to generate c.20% of the power needed for
the Company's Sunderland plant. We also energised our
19th Tesco store and reached financial close on a
further three stores with an additional 66 in the framework
agreement to be commercialised under 20-year private wire PPA
agreements.
Despite a 2.7x increase in total
generation to 23,997 MWh of clean energy in the period, abnormal
rainfall over the winter has caused a reduction in UK solar
irradiation, which in line with our peer group, has resulted in
actual production falling 10% below our operational
target.
We have continued our strong track
record on installation assets energising 50MW in the period with
our portfolio now 74% operational. Mobilisation at the remaining
55MW Skeeby solar farm installation commenced in mid-August with
full energisation expected in July. Like others in the sector, we
have not been immune to supply chain disruption and equipment
delays have pushed back this target date by three months
with the delay costs substantially covered
by our EPC contractors.
Our truly differentiated strategy
provides a highly contracted portfolio. Our average contract
duration is 11 years, one of the longest in the sector, and one of
the least sensitive to wholesale electricity prices, whilst
providing income which is 91% linked to annual inflation or fixed
uplifts.
This supports our objective of
providing long-term sustainable dividend growth and I am pleased to
reaffirm our target dividend of 5.5 pence per Ordinary Share for
FY24, an increase of 10% over the previous year with the 12-month
forward-looking dividend cover expected to be in excess of 1.4x
(1.3x as at 30 September 2023).
The Company's 31 March 2024 NAV
was £135.1 million or 90.0 pence per share (30 September 2023:
£138.1 million or 92.0 pence per share). Overall, our NAV per share
declined by 2.0 pence, driven by higher market discount rates,
lower inflation expectations and the inclusion of leverage within
the portfolio. The portfolio discount rate for the Period was 7.9%
levered (30 September 2023: 7.4% unlevered).
Outlook
As a business, we are very well
positioned to play a key role in supporting the UK's path to net
zero in the years to come. Our purpose is to build a clean energy
portfolio that generates sustainable returns, decarbonises the
operations of businesses across the UK, and contributes to our net
zero future.
The Company has built a
diversified solar portfolio generating high levels of clean energy,
with the lowest exposure to wholesale power prices in the UK listed
solar sector whilst producing significant free cash flow. Despite
this, both the Board and the Investment Adviser recognise that in
common with the majority of the renewable investment trust sector,
the share price remains detached from the underlying value of the
Company's assets.
The Company continues to deliver
on its investment objective of providing a progressive dividend
through its highly contracted and growing income streams.
However, the Directors have also remained
focused on initiatives to address the discount to NAV at which the
Company's shares have traded and to place the fund in the best
possible financial position to support shareholders'
interests. Considering this and the
pending discontinuation vote due in the first quarter of 2025, the
Directors are working with the Investment Adviser to explore
opportunities to optimise the returns to shareholders. These
include joint venture partnership, recycling capital from
operational assets into installation assets to provide enhanced
capital growth or earlier capital returns to shareholders.
Juliet Davenport OBE
Chair
19 June 2024
INVESTMENT ADVISER'S REPORT
Atrato Partners Limited is the
Investment Adviser to Atrato Onsite Energy plc and is pleased to
report on the operations of the Company for the Period.
The Investment Adviser is
responsible for sourcing and acquiring assets as well as the
day-to-day management of the Company's investment portfolio.
Further details can be found on the Investment Adviser's website
at www.atratogroup.com.
Investment Portfolio
We have continued to grow the
Company, facilitated by the RCF, and create a diversified portfolio
of UK solar assets with one of the lowest sensitivities to merchant
power price in the sector.
As at 31 March 2024, £198m had
been committed or deployed into UK solar across 41 projects with a
combined capacity of 182MW. During the Period, the Company invested
£77.3 million into a 34MW operational private wire solar portfolio
(the "ASG portfolio"), the Company's largest acquisition to date.
Post the balance sheet date, we also completed three solar
investments for a combined consideration of £16.9m, comprising
22.1MW of solar capacity and increasing our total to
204MW.
During the Period, the Company's
portfolio has made the transition from being primarily at an
installation stage to being primarily an operational portfolio. The
Company's portfolio is 72% operational as at 31 March 2024 and is
due to be fully operational by the end of July 2024 following
completion of the 55MW OVO Energy solar farm project.
We have built a high-quality
portfolio of clean energy assets with highly contracted long-term
income. Post the balance sheet date, 93% of annual revenue is
contracted (with a weighted average unexpired contract term of 11
years) with 91%[11] of revenue subject to
annual index linked uplifts.
The table below outlines the
Company's investment portfolio to date:
Off-taker
|
Location
|
Sector
|
Capacity (MW)[12]
|
Status
|
Remaining contracted term (years)[13]
|
Revenue type
|
Amazon UK Services Ltd.
|
Northamptonshire
|
Distribution
|
0.6
|
Operational
|
15.8
|
PPA
|
Amazon UK Services Ltd.
|
Essex
|
Distribution
|
3.1
|
Operational
|
16.5
|
PPA
|
Amazon UK Services Ltd.
|
Warwickshire
|
Distribution
|
1.6
|
Operational
|
16.6
|
PPA
|
Amazon UK Services Ltd.
|
Fife
|
Distribution
|
1.6
|
Operational
|
16.8
|
PPA
|
Amazon UK Services Ltd.
|
Cheshire
|
Distribution
|
1.5
|
Operational
|
16.8
|
PPA
|
Amazon UK Services Ltd.
|
Luton
|
Distribution
|
1.5
|
Operational
|
16.9
|
PPA
|
Amazon UK Services Ltd.
|
Leicestershire
|
Distribution
|
2.2
|
Operational
|
17.7
|
PPA
|
Anglian Water Services
Limited
|
Cambridgeshire
|
Utility
|
11.7
|
Operational
|
21.5
|
PPA
|
Anglian Water Services
Limited
|
Essex
|
Utility
|
0.5
|
Operational
|
19.3
|
PPA / FiT
|
Anglian Water Services
Limited
|
Cambridgeshire
|
Utility
|
0.2
|
Operational
|
19.6
|
PPA / FiT
|
Anglian Water Services
Limited
|
Cambridgeshire
|
Utility
|
0.2
|
Operational
|
19.6
|
PPA / FiT
|
Anglian Water Services
Limited
|
Lincolnshire
|
Utility
|
0.2
|
Operational
|
20.1
|
PPA / FiT
|
Anglian Water Services
Limited
|
Northamptonshire
|
Utility
|
0.6
|
Operational
|
20.1
|
PPA / FiT
|
Anglian Water Services
Limited
|
Essex
|
Utility
|
0.9
|
Operational
|
20.5
|
PPA / FiT
|
Bentley Motors Limited
|
Cheshire
|
Manufacturing
|
2.7
|
Operational
|
23.7
|
PPA
|
Britvic Soft Drinks Ltd
|
Northamptonshire
|
Food and beverage
|
28.4
|
Operational
|
9.8
|
PPA
|
Gardner Group Limited
|
Derbyshire
|
Manufacturing
|
1.3
|
Operational
|
23.5
|
PPA
|
Good Energy
|
Worcestershire
|
Utility
|
1.7
|
Operational
|
13.0
|
PPA / ROC
|
Good Energy
|
Gwent
|
Utility
|
3.3
|
Operational
|
0.25
|
PPA
|
Huntapac Produce
Limited
|
Lancashire
|
Food production
|
1.3
|
Operational
|
14.5
|
PPA
|
Marks & Spencer Plc
|
Leicestershire
|
Grocery
|
6.1
|
Operational
|
11.0
|
PPA / ROC
|
Nissan Motor Manufacturing UK
Limited
|
County Durham
|
Manufacturing
|
20.0
|
Operational
|
19.5
|
PPA
|
OVO Energy
|
North Yorkshire
|
Utility
|
55.5
|
Installation
|
2.7
|
PPA
|
Recipharm HC Ltd
|
Cheshire
|
Pharmaceuticals
|
1.0
|
Operational
|
24.0
|
PPA
|
Residential portfolio
|
Various
|
Residential
|
42.0
|
Operational
|
10.9
|
FiT
|
Tesco Stores Limited
|
Kent
|
Grocery
|
0.1
|
Operational
|
15.7
|
PPA
|
Tesco Stores Limited
|
Stockport
|
Grocery
|
0.9
|
Installation
|
20.0
|
PPA
|
Tesco Stores Limited
|
Wisbech
|
Grocery
|
0.7
|
Installation
|
20.0
|
PPA
|
Tesco Stores Limited
|
Kings Lynn
|
Grocery
|
0.6
|
Installation
|
20.0
|
PPA
|
Tesco Stores Limited
|
Essex
|
Grocery
|
0.3
|
Operational
|
15.7
|
PPA
|
Tesco Stores Limited
|
Essex
|
Grocery
|
0.4
|
Operational
|
15.8
|
PPA
|
Tesco Stores Limited
|
Essex
|
Grocery
|
0.1
|
Operational
|
15.8
|
PPA
|
Tesco Stores Limited
|
Kent
|
Grocery
|
0.3
|
Operational
|
15.8
|
PPA
|
Tesco Stores Limited
|
Wiltshire
|
Grocery
|
0.3
|
Operational
|
15.9
|
PPA
|
Tesco Stores Limited
|
Kent
|
Grocery
|
0.4
|
Operational
|
16.0
|
PPA
|
Tesco Stores Limited
|
Lincolnshire
|
Grocery
|
0.5
|
Operational
|
16.0
|
PPA
|
Tesco Stores Limited
|
Somerset
|
Grocery
|
0.3
|
Operational
|
16.1
|
PPA
|
Tesco Stores Limited
|
Greater Manchester
|
Grocery
|
0.2
|
Operational
|
16.1
|
PPA
|
Tesco Stores Limited
|
Suffolk
|
Grocery
|
0.4
|
Operational
|
16.2
|
PPA
|
Tesco Stores Limited
|
Kent
|
Grocery
|
0.3
|
Operational
|
16.3
|
PPA
|
Tesco Stores Limited
|
Greater London
|
Grocery
|
0.5
|
Operational
|
16.3
|
PPA
|
Tesco Stores Limited
|
Greater Manchester
|
Grocery
|
0.7
|
Operational
|
16.3
|
PPA
|
Tesco Stores Limited
|
Kent
|
Grocery
|
0.3
|
Operational
|
17.3
|
PPA
|
Tesco Stores Limited
|
Lincolnshire
|
Grocery
|
0.6
|
Operational
|
17.8
|
PPA
|
Tesco Stores Limited
|
Nottinghamshire
|
Grocery
|
0.7
|
Operational
|
17.7
|
PPA
|
Tesco Stores Limited
|
North Yorkshire
|
Grocery
|
0.5
|
Operational
|
17.8
|
PPA
|
Tesco Stores Limited
|
Norfolk
|
Grocery
|
0.4
|
Operational
|
19.5
|
PPA
|
Unipres (UK) Limited
|
County Durham
|
Manufacturing
|
4.6
|
Operational
|
17.2
|
PPA
|
Total
|
|
|
203.7
|
|
10.9 average[14]
|
|
All of the Company's installation
projects are expected to be fully operational by the end of July
2024. Once the invested portfolio is fully operational, the Company
expects to be circa 1.41x covered on its dividend on a 12-month
forward looking basis[15]. Investments
made during the Period decreased the Company's power price
sensitivity to 3.9%[16] (4.6% as at 30
September 2023). At this level, the
Company maintains one of the lowest sensitivities to power prices
in the UK renewables sector.
Portfolio performance
In the Period, the portfolio
generated 23,997 MWh of clean energy representing a 270% increase
over the same period last year following the expansion of the
Company's operational portfolio.
Despite the overall increase in
total generation for the Company, generation for the 6 months to 31
March 2024 was 12.9% below our budgeted generation. Abnormal
weather patterns in the UK during October and December have
resulted in lower irradiation levels across the UK solar sector and
some 5.2% lower than our budgeted levels. This lower level of
irradiation and availability contributed to generation being some
10% lower than budgeted for the 6-months to 31 March 2023. The
remaining 2.9% was due to delays in energisation of our London Road
site, the cost of which was substantially covered by delay
liquidated damages payable by the EPC contractor.
Net production variance vs.
expected (GWh) for the Period
|
Actual
(GWh)
|
Budget
(GWh)
|
GWh
(below) / above expectation
|
%
(below) / above expectation
|
Operating assets for the six-month
period ended 31 March 2024
|
23.997
GWh
|
27.559
GWh
|
(3.562)
|
(12.9%)
|
Operating assets for the six-month
period ended 31 March 2023
|
8.847
GWh
|
8.077 GWh
|
0.769
|
9.5%
|
During the Period, avoided
emissions were c.5,300t CO2e which is the equivalent to
powering 8,900 homes with clean energy.
Energisations in the Period
During the Period, the Company
successfully installed and fully energised 50MW of installation
projects increasing the Company's operational portfolio to
126MW[17]. This includes:
· 20MW
project at Nissan in Sunderland in October 2023. The ground mount
system is expected to generate a fifth of the energy required for
Nissan's Sunderland plant. The project has been commercialised
through a 20-year private wire PPA with Nissan Motor Manufacturing
for an 100% take-or-pay arrangement.
· Two
behind-the-meter rooftop sites in October 2023; a 0.4MW system at
Tesco, Thetford and a 1.3MW system at Huntapac. The Tesco Thetford
installation is the Company's 19th Tesco private wire
asset and the first under the Tesco framework agreement.
· 28MW
project at London Road, Wellingborough, Northamptonshire in
December. This installation was the Company's first grid-connected
asset completed and has been commercialised under an innovative
sleeved 10-year PPA to Britvic. The project is expected to generate
33GWh of clean energy per annum energising 75% of Britvic's
production operations in Great Britain.
Portfolio acquisitions in the Period
The Company made one acquisition
during the Period: a 34MW operational private wire solar portfolio.
The project was acquired for a total value of £77.3 million,
including £47.1 million of term debt and benefitting from payments
from the government's feed-in-tariff ("FiT") scheme. These payments
provide the Company with highly contracted revenue streams
underpinned by government- backed income with annual, uncapped RPI
uplifts and are payable directly to the Company from the respective
utility companies. The portfolio was acquired with a 12-year
unexpired term.
Pipeline
The Company continues to maintain
a significant pipeline of UK behind-the-meter and
front-of-the-meter solar assets. At the full year results in
September 2023, the Company announced a pipeline of 485MW (over
£400 million). The pipeline has since grown to 516MW at a value of
c.£429 million.
438MW of the pipeline relates to
new installation projects, while the remaining 78MW relate to
operational projects. Of this pipeline, the Investment Adviser has
a near-term pipeline of over £130 million. If these projects are
progressed, they are expected to be funded by the remaining
liquidity available from the Company's RCF headroom of £10 million.
Despite the decline in wholesale
energy prices, the Company continues to see strong corporate demand
for long-term clean energy PPAs.
Financial performance
The financial statements of the
Company for the six months ended 31 March 2024 are set out in this
interim report. These interim financial statements have been
prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006 and the
applicable legal requirements.
For the six months ending 31 March
2024, the Company's operational portfolio generated revenues of
£4.1 million. Operational expenditure for
the Period totalled £1.2 million, EBITDA for the portfolio over the
six months ending 31 March 2024 was £2.8 million. The Company has
included this information for the first time to provide insight to
earnings generated at the project level.
During the Period the Company's
NAV decreased from £138.1 million to £135.1 million or 90.0 pence
per Ordinary Share (September 2023: 92.0 pence). The NAV decrease
was driven by the leverage premium applied to the discount rates,
dividend and fund costs paid during the Period, lower power prices,
changes in the inflation assumptions which were offset by the
realisation of operating cash and time value realised by unwinding
discount on future cash flows by moving the valuation date from
September 2023 to March 2024. Further details on the portfolio
valuation are provided below.
Dividends
The Company aims to provide
investors with capital growth alongside a progressive dividend,
underpinned by the contractual inflation and fixed uplifts within
its PPA agreements.
Once the installation assets
become fully operational, the current dividend target (5.5p per
Ordinary Share) is projected to be 1.41x covered from project
revenues[18].
Portfolio valuation
The valuation of the Portfolio as
at 31 March 2024 was £134.4 million. The table below shows a
breakdown of the Portfolio valuation during the Period.
|
For the
six months ended 31 March
2024
|
For the
six months ended 31 March
2023
|
For the
12 months ended 30 September 2023
|
|
£m
|
£m
|
£m
|
Portfolio valuation as at 30
September
|
99.3
|
47.1
|
47.1
|
Investments in the
period
|
37.6
|
11.7
|
46.8
|
Interest receivable
|
2.0
|
0.7
|
2.4
|
Repayment of shareholder
loan
|
(3.1)
|
-
|
(0.7)
|
Portfolio fair value
movement
|
(1.4)
|
3.9
|
3.7
|
Portfolio valuation as at 31 March
|
134.4
|
63.4
|
99.3
|
The valuation of
the Company's Portfolio is performed on a semi-annual basis at 31
March and 30 September. The Investment Adviser is responsible for
advising the Board in determining the valuation of the Portfolio
and, when required, carrying out the fair market valuation of the
Company's investments. The valuation has been supported by an
independent valuation firm.
A discounted cash flow ("DCF")
valuation methodology is applied to determine the fair value of
each investment which is customary for valuing privately owned
renewable energy assets and considered consistent with the
requirements of compliance with International Financial Reporting
Standard ("IFRS") 9 and IFRS 13.
Using the DCF methodology, the fair
value is derived from the present value of each investment's
expected future cash flows, using reasonable assumptions and
forecasts for revenues and operating costs and an appropriate
discount rate. Key macroeconomic and fiscal assumptions for the
valuations are set out in Note 13 to the financial
statements.
The Company's NAV as at 31 March
2024 is £135.1 million or 90.0 pence per ordinary share.
The Company's portfolio valuation
per the table[19], reflects acquisitions
and planned milestone payments for the installation assets. The NAV
also reflects changes to economic, wholesale energy and asset
specific assumptions and is net of distributions to
shareholders.
Valuation economic
assumptions
The main economic assumptions used
in the portfolio valuation are discount rates, annual energy
production, merchant power prices, various operating expenses and
associated annual escalation rates. These are consistent with those
outlined in the FY 2023 Annual Report.
Weighted average discount rate for
valuation
A range of discount rates are
applied in calculating the fair value of the investments,
considering the location, technology, and lifecycle stage of each
asset as well as leverage and the counterparty risk. The weighted
average discount rate as at 31 March 2024 is 7.9% (30 September
2023: 7.4%).
The elevated macro-economic
volatility, experienced in the fourth quarter of 2022 has settled,
stabilising the UK risk free rates and economic outlook. This has
allowed the Investment Adviser to hold the discount rate consistent
in terms of movements for risk free rates; however due to the
introduction of debt through the acquisition of the ASG portfolio
and utilising the RCF for new acquisitions has resulted in an
increase of the weighted average to a levered 7.9% (September 2023:
unlevered 7.4%)
Portfolio valuation sensitivities
The figure below shows the impact
on the portfolio valuation of changes to the key input assumptions
("Sensitivities"). The Sensitivities are based on the Portfolio as
at 31 March 2024.
(as of
31 March 2024)
For each sensitivity illustrated,
it is assumed that potential changes occur independently with no
effect on any other assumption. The low sensitivity to changes in
merchant power prices reflects the long-term contracted revenues in
the Company's Portfolio. Additionally, the Company's sensitivity to
variations in operational expenses, reflects the Company's assets
having fixed price, long-term contracts in place with operations
and maintenance ("O&M") contractors.
Volumes
Each asset's valuation assumes a
"P50" level of electricity output based on yield assessments
prepared by technical advisers. The P50 output is the estimated
annual amount of electricity generation that has a 50% probability
of being exceeded - both in any single year and over the long term
- and a 50% probability of being underachieved. The P50 provides an
expected level of generation over the longer term.
The P90 (90% probability of
exceedance) and P10 (10% probability of exceedance) sensitivities
reflect the future variability of solar irradiation and the
associated impact on output, along with the uncertainty associated
with the long-term data sources used to calculate the P50 forecast.
The Sensitivities shown assume that the output of each asset in the
portfolio is in line with the P10 or P90 output forecast
respectively for each asset life.
Power price curve
The Company derives long-term
power prices from independent and widely
used market consultants' technology-specific capture price
forecasts, for the longer term. In the short term, the two years
from March 2024, the UK baseload electricity forward prices have
been used. The industry standard sensitivity metric assumes a 10%
increase or decrease in power prices relative to the base case for
each year of the asset life.
Inflation
The sensitivity assumes a 50bps
increase or decrease in inflation relative to the base case for
each year of the asset life.
Net assets
Company net assets were £135.1
million as at 31 March 2024.
The net assets comprise the fair
value of the Company's investments of £134.4 million, the Company's cash
balance of £10.4 million and other net receivables of £9.3 million.
Analysis of the Company's net assets
|
Unaudited 31 March
2024
|
Audited
30 September
2023
|
|
£m
|
£m
|
Fair value of investments
|
134.4
|
99.3
|
Cash
|
10.5
|
37.9
|
Net working capital
|
(9.8)
|
0.9
|
Net asset value
|
135.1
|
138.1
|
Number of shares
|
150.0
|
150.0
|
Net asset value per share (pence)
|
90.0
|
92.0
|
NAV Bridge from 30 September 2023 to 31 March
2024
Movement in Net Asset Value
|
£m
|
Pence per
share
|
NAV at September 2023
|
138.1
|
92.0
|
Operational cash flow
|
2.4
|
1.6
|
Time value
|
3.4
|
2.3
|
Dividends paid
|
(3.9)
|
(2.6)
|
Power prices
|
(1.9)
|
(1.3)
|
Inflation
|
(1.8)
|
(1.2)
|
Discount rate movement
|
(1.6)
|
(1.1)
|
Other
|
0.4
|
0.3
|
NAV as at 31 March 2024
|
135.1
|
90.0
|
Operational cash
flow: represents the cash realised
through operational activity during the period of £2.4 million (1.6
pence per share).
Time value - a value uplift
of £3.4 million (2.3 pence per share), resulting from the roll
forward effect of cash flows since the prior valuation
date.
Dividends paid: Dividends of £3.9 million (2.6 pence per share) were
paid in respect of the quarterly period to 30 September 2023,
declared in November 2023 and the quarterly period to 31 December
2023, declared in January 2024.
Power prices: Reflects the movement of the portfolio value during the
Period due to movements in the industry standard power price
curves. The decrease in forward power price curves during the
period has reduced the portfolio value by £1.9 million (1.3 pence per share).
The Company has the lowest
sensitivity to merchant power price in the UK listed solar sector.
Its high levels of contracted revenue limit its exposure to power
price volatility and hence a 10% reduction in power prices would
only have a 4.3% impact on the Company's NAV as at 31 March
2024.
Inflation - Reflects the
impact of the movement in the inflation curves during the period.
The Company uses market forecast curves for UK CPI and RPI. The
decrease has reduced the portfolio value by £1.8 million (12 pence
per share).
Discount rate - Represents
the impact on the fair value from changes to the discount rate due
to movements in interest rates, transactional prices observed in
the sector and the macro-economic environment. The increase in the
weighted average discount rate from 7.4% to 7.9% has reduced the
portfolio valuation by £1.6 million (1.1 pence per share). One of
the main drivers of the increase in the weighted average discount
rate during the period was the introduction of leverage through the
NatWest RCF and the project finance relating to the ASG Portfolio,
totaling £75.7 million.
Other: Represents the
impact of other immaterial portfolio adjustments resulting in an
increase of £0.4 million (0.3 pence per share).
Income
In accordance with the Statement
of Recommended Practice, Financial Statements of Investment Trust
Companies and Venture Capital Trusts ("SORP") issued in July 2022
by the Association of Investment Companies ("AIC"), the statement
of comprehensive income differentiates between the 'revenue'
account and the 'capital' account, and the sum of both items equals
the Company's profit for the period. Items classified as capital in
nature either relate directly to the Company's investment portfolio
or are costs deemed attributable to the long-term capital growth of
the Company (such as a portion of the Investment Adviser
fee).
In the six-month period ending 31
March 2024, the Company's operating income was £2.3 million (31
March 2023: £6.5 million), including interest income of £3.7
million (31 March 2023: £2.5 million) and net loss on the movement
of fair value of investments of £1.4 million (31 March 2023: gain
£4.0 million). The operating expenses included in the statement of
comprehensive income for the period were £1.4 million (31 March
2023: £1.2 million). These comprise £0.7 million Investment Adviser
fees (31 March 2023: £0.7 million) and £0.7 million operating
expenses (31 March 2023: £0.7 million). The details of how the
Investment Adviser fees are charged are set out in Note 9 to the
financial statements.
Ongoing charges
The ongoing charges ratio ("OCR")
is a measure, expressed as a percentage of average net assets, of
the regular, recurring annual costs of running the Company. It has
been calculated and disclosed in accordance with the AIC
methodology, as annualised ongoing charges (i.e. excluding
acquisitions costs and other non-recurring items) divided by the
average published undiluted Net Asset Value in the period. The
ratio was 1.8% in the prior year to 30 September 2023, and it is
anticipated that the full-year ratio for the year ended 30
September 2024 will increase to 1.9%.
Dividends
During the Period, interim
dividends totalling £3.9 million were paid (representing 2.63p per
share). The table below outlines the dividends paid during the
period and post period end.
Period
|
Amount (per Ordinary
share)
|
Amount
(total)
|
During the Period
|
|
|
1 July to 30 Sep 2023
|
1.26
|
1,890,000
|
1 Oct to 31 Dec 2023
|
1.37
|
2,055,000
|
Post period end
|
|
|
1 Jan to 31 Mar 2024
|
1.37
|
2,055,000
|
Post period end, a further interim
dividend of 1.37p per share was paid on 28 May 2024 in respect of
the quarter to 31 March 2024 to shareholders recorded on the
register on 3 May 2024. The total number of ordinary shares in
issue on that record date was 150,000,000 and the total dividend
paid to shareholders amounted to £2.055 million.
As such, dividends totalling £3.9
million (HY 2023: £3.8 million) have been paid in respect of the
six-month period under review.
Operating cashflow from the
portfolio of assets in the six-month period totalled £2.8
million.
The investment opportunity
Despite the decline in wholesale
electricity prices, the Company's continues to experience strong
corporate demand for its PPAs. The Company's PPAs offer a fully
funded solution for corporates providing them directly with clean
energy. The PPA option is attractive for corporates as they look to
meet their sustainability goals whilst improving their energy
security and affordability.
The UK government continues to
recognise solar's role in the UK's path to net zero. In the Autumn
Statement, the UK government announced an action plan to cut grid
connection delays with a target of halving the time it takes to
build new grid infrastructure to 7 years which will alleviate the
build-up of solar projects awaiting grid connection. It is
estimated that this will cut grid delays by 90%.
Financing
Atrato Onsite Energy Holdco
Limited ("Holdco") secured £10 million of the total £20 million
accordion available under the RCF taking the facility to a total of
£40 million, with £10 million remaining as an accordion option. Of
the £40 million available to draw, £30 million has been drawn as at
31 March 2024 (31 March 2023: £nil).
The £40 million secured facility
has an initial term of three years with a one-year extension
option. The facility is priced at 1.3% margin over SONIA, which is
one of the lowest in the sector and is unhedged.
Going concern
The Directors have adopted the
going concern basis in preparing the interim financial statements.
The following is a summary of the Directors' assessment of the
going concern status of the Company.
The Directors have a reasonable
expectation that the Company has adequate resources to continue in
operational existence for at least twelve months from the date of
this report. In reaching this conclusion, the Directors have
considered the liquidity of the Company's portfolio of investments
as well as its cash position, income, and expense flows. The
Company's net assets at 31 March 2024 were £135.1 million (30
September 2023: £138.1 million). As at 31 March 2024, the Company
held £10.5 million (30 September 2023: £37.9 million) in cash. The
total expenses for the period ended 31 March 2024 were £1.4 million
(31 March 2023: £1.2 million).
Post the balance sheet date the
Company acquired two operational assets
for £4.7 million by utilising the funds drawn on the RCF in March
2024. At the date of approval of this report,
based on the aggregate of investments, capital commitments and cash
held, the Company has substantial operating expenses
cover.
Future revenue is principally
expected to be derived through loan interest and dividends from
profit generated by underlying investments held within the SPVs.
Having regard to the current portfolio combined with current cash
balances, the Directors consider the Company to be in a position to
meet its current and future liabilities over the next 12-month
period.
In light of the ongoing conflicts
in the Middle East and Ukraine, the Directors have considered any
potential impact on the portfolio's operations and procurement
processes, and do not foresee any material adverse impact for next
12 months. Energy prices can fluctuate as a result of the conflict,
which the Directors maintain under close review; however, no
material adverse impact on the business is expected.
Material uncertainty in relation to Going
Concern
The Company continues to deliver
on its investment objective of providing a progressive dividend
through its highly contracted and growing income streams.
However, the Directors have also remained
focused on initiatives to address the discount to NAV at which the
Company's shares have traded and to place the fund in the best
possible financial position to support shareholders'
interests. Considering this and the
pending discontinuation vote due in the first quarter of 2025,
the Directors are working with the Investment Adviser to
explore opportunities to optimise the returns to shareholders.
These include joint venture partnership, recycling capital from
operational assets into installation assets to provide enhanced
capital growth or earlier capital returns to shareholders.
It is possible that one of the
outcomes could result in the sale of some or all of the Company's
assets. As a result, a material uncertainty exists which may cast
significant doubt on the Company's ability to continue as a going
concern. In such an event, the Company will realise its assets and
use the funds to discharge its liabilities rather than discharge
the liabilities in the normal course of business. However, there is
no certainty around timing, outcome, and effects of these
opportunities, if any, and therefore the Directors have prepared
the interim financial statements on a going concern
basis.
The interim financial statements
do not include the adjustments that would be required should the
going concern basis of preparation no longer be
appropriate.
Sustainability Report
Introduction
Purpose: to
build a clean energy portfolio that generates sustainable returns
and contributes to our net zero future.
As a clean energy fund, the
Company has an intrinsic sustainability focus. All investments in
the portfolio are contributing to the net zero transition and
helping to accelerate the decarbonisation of our off-takers.
The Company's sustainability
strategy is focused on four ESG principles linked to the UN SDGs
that it believes are most material to its activities. The Company
has identified specific ESG reporting metrics in relation to each
principle and will disclose the FY24 results in the next Annual
Report.
Principle 1: Climate Change/Net Zero Transition
|
Principle 2: Environment
|
Principle 3: Social
|
Principle 4; Governance
|
Support the attainment of the UK
emissions targets through the creation of new sustainable energy
resource.
|
Facilitate the efficient and
considered use of finite resources
|
Bring value to the communities in
which we are active
|
Deliver the Company's investment
objective through a robust governance framework that recognises its
responsibilities to all stakeholders
|
Affordable and clean
energy
UN SDG 7
|
Climate Action
UN SDG 13
|
Life on Land
UN SDG 15
|
Responsible production and
consumption
UN SDG 12
|
Decent work and
economic growth
UN SDG 8
|
Sustainable cities and
communities
UN SDG 11
|
Gender equality
UN SDG 5
|
|
|
|
|
|
| |
The Company has continued to
deliver on its sustainability strategy and target performance
improvement across these four ESG principles.
ESG Principle 1 - Climate/Net Zero
· Support the attainment of
the UK emissions targets through the creation of new sustainable
energy resource
The Company's last Annual Report
and Accounts included the Company's Task Force on Climate-related
Financial Disclosures ("TCFD") report, with disclosures made across
all 11 TCFD recommendations. Included within this report was the
Company's GHG Inventory disclosures, across Scope 1, 2 and 3
emissions. As part of the Company's
commitment to further developing its mechanisms to identify, manage
and respond to climate-related risks, TCFD and climate risk
training was rolled out to the Investment Adviser and completed by
the full team in May 2024.
The Science Based Target
Initiative (SBTi) has not yet published guidance for the renewables
sector. The Company continues to monitor the development of
available sector guidance by SBTi. In the absence of available
sector guidance, the Company's key climate-related target is to
continue to provide 100% of electricity generation finance for only
renewable electricity through 2030.
ESG Principle 2 - Environment
· Facilitate the efficient and
considered use of finite resources
The Company acknowledges that
society, business, and finance depend on nature's assets and the
services they provide. As part of the planning and consent process
for ground mounted solar sites, ecological appraisals and
nature/biodiversity plans are developed to identify ecological
enhancement opportunities. Additional species surveys such as for
breeding and/or wintering birds, bats, butterflies and Great
Crested Newts, are also conducted on a site specific basis as
required. Landscaping works, including enhanced hedgerow planting
and habitat enhancements for Great Crested Newts, are planned to
take place at the London Road site in late 2024.
ESG Principle 3 - Social
· Bring value to the
communities in which we are active
The Company through the Investment
Adviser continues to support education initiatives that align with
the Company's objective to support both gender equality and the
right to decent work. In April 2024 the Investment Adviser held a
work experience event for Into University at their
offices. Into
University seeks to provide children from Britain's least
privileged neighbourhood with the educational support they need to
succeed, breaking the poverty circle. The event was attended by
more than 20 year nine students and run by members of the
Investment Adviser's team.
The Investment Adviser has
established the Atrato Foundation, to provide financial support to
charitable organisations operating in England and Wales.
ESG Principle 4 - Governance
· Deliver the Company's
investment objective through a robust governance framework that
recognises its responsibilities to all
stakeholders
The Company's approach to
sustainability is underpinned by the Board's commitment to good
stewardship and creating long-term value for our stakeholders. The
Company continues to support the commitments of its Investment
Adviser as a signatory to both the United Nations Principles for
Responsible Investment ("UNPRI") and Net Zero Asset Managers
Initiative ("NZAM"). The Investment Adviser received the results of
its first PRI Report submission in January 2024 and will be
reporting on its responsible investment activities again in the
next PRI reporting cycle. In January 2024, the Investment Adviser
also became part of the first cohort of endorsers of Spring - a PRI
stewardship initiative for nature.
In March 2024, the Company became
a member of the Solar Stewardship Initiative ("SSI"). The SSI is an
industry initiative established by SolarPower Europe and Solar
Energy UK which aims to drive a more responsible, transparent and
sustainable solar value chain. The Company also signed the latest
UK Industry Supply Chain Statement prepared by Solar Energy UK,
reflecting the Company's commitment to industry-wide action to
complement individual Company efforts to strengthen supply chain
standards.[20]
While the FCA listing rules do not
require the Company to make disclosures under the TCFD framework
for the financial year 2023/2024, the Company intends to continue
to do so on a voluntarily basis. Work, including undertaking a
greenhouse gas inventory calculation and qualitative scenario
analysis, to enable TCFD disclosure is ongoing with the Investment
Adviser.
The Company published its updated
Modern Slavery Statement in December 2023. The Investment Adviser
is currently undertaking a review of its Module Procurement Policy
to ensure alignment with current best practice guidance including
the practical procurement guidance published by Action
Sustainability.[21]
The Company published a number of
additional ESG policies on its website in December 2023 including
Environment, Biodiversity, and Supply Chain Human Rights
Policies.
The Company continues to monitor
the evolution of relevant ESG-related regulation including the
implementation of the Financial Conduct Authority's UK
Sustainability Disclosure Requirements ("SDR"). The Company
supports the introduction of the SDR anti-greenwashing rule and the
FCA's efforts to ensure that sustainability-related claims are
fair, clear, and not misleading. The Company is currently
ineligible for a SDR investment label because the FCA Handbook (ESG
sourcebook section) stipulates that only funds with a UK
Alternative Investment Fund Manager ("AIFM") are in scope. However,
the Company will continue to monitor updates from the FCA should
the scope be expanded in future.
Atrato Partners Limited
Investment Adviser
19 June 2024
Interim Management Report
The Directors are required to
provide an Interim Management Report in accordance with the
Financial Conduct Authority ("FCA") Disclosure Guidance and
Transparency Rules ("DTR"). The Chair's Statement and the
Investment Advisers' Report in this interim report provide details
of the important events which have occurred during the period and
their impact on the financial statements. The following statements
on risks and risk management, related party
transactions, going concern
and the Directors' Responsibility Statement below, together
constitute the Interim Management Report for the Company for the
six months ended 31 March 2024. The outlook for the Company for the
remaining six months of the year ending 30 September 2024 is
discussed in the Chair's Statement and the Investment Adviser's
Report.
Risk and Risk Management
The Company's approach to risk
governance and its risk review process are set out in the risks and
risk management section of the 2023 Annual Report. The principal
risks to the achievement of the Company's objectives are mostly
unchanged and no further changes are expected in the remaining
six-months of the financial year from those reported on pages 49 to
52 of the 2023 Annual Report, with the principal risks
being:
· Performance and portfolio
management risks:
o Electricity generation may not meet expectations;
o Valuation of the portfolio; and
o Performance and reliance on third party advisers and service
providers as the Company has no employees;
· Operational
risks:
o Plant operational performance may be lower than
expected;
o Counter-party credit risk as the Company's revenues are
dependent on onsite or sleeved users that contracted under PPAs to
pay for electricity generated; and
o Delays in developing installation assets may impact
returns
· Market
risks:
o The income and value of the Company's investments may be
adversely impacted by changes in the prevailing market prices of
electricity and prices achievable for off-taker
contracts;
o Conflicts being experienced in Ukraine and the Middle
East;
o Long-term consequences of Brexit; and
o Changes in regulations including the energy markets, tax
legislation and government policy.
The risks outlined here and in the
2023 Annual Report are mitigated by the Investment Adviser's
strategy, experience and the diversification of the Company's
pipeline as set out on pages 49 to 52 in the 2023 Annual
Report.
Related party transactions
The Company's Investment Adviser ("IA") is considered a related
party under the Listing Rules. Under the Investment Adviser
Agreement ("IAA"), the IA receives a per annum management fee of
0.7125% of the adjusted NAV up to and including £500 million; and
0.5625% of the adjusted NAV above £500 million, invoiced monthly in
arrears. The Investment Adviser also
receives a management fee of 0.2375% of the last published NAV up
to and including £500 million; and 0.1875% of the last published
NAV above £500 million, each invoiced semi-annually in arrears.
With the agreement of the Company, Holdco and the IA, this
semi-annual fee shall be applied by the IA in acquiring ordinary
shares at the absolute discretion of the Board by any combination
of methods as set out in the IAA.
The Investment Adviser receives an
accounting and administration fee of £50,000 per annum plus 0.02%
of the adjusted NAV in excess of £200 million up to and including
£500 million plus 0.015% of adjusted NAV in excess of £500 million.
An accounting and administration fee of £800 per Clean Energy Asset
held by Holdco up to 100 Clean Energy Assets and £650 per Clean
Energy Asset above 100.
No performance fee or asset level
fees are payable to the IA under the IAA.
Details of the amounts paid to the
Company's IA and the Directors during the period are included in
the Note 4 to the Interim Financial
Statements.
Alternative Investment Fund Manager (the
"AIFM")
JTC Global AIFM Solutions Limited
was appointed with effect from IPO as the AIFM under the terms of
the AIFM agreement and in accordance with the AIFM
Directive.
The AIFM is authorised and
regulated by the Guernsey Financial Services Commission.
The AIFM is responsible for the
day-to-day management of the Company's investments, subject to the
investment objective and investment policy and the overall
supervision of the Directors. The AIFM is also required to comply
with on-going capital, reporting and transparency obligations and a
range of organisational requirements and conduct of business rules.
The AIFM must also adopt a range of policies and procedures
addressing areas such as risk management, liquidity management,
conflicts of interest, valuations, compliance, internal audit, and
remuneration.
Directors' responsibility statement
The Directors acknowledge
responsibility for the interim results and approve this interim
report. The Directors confirm that to the best of their
knowledge:
a) the condensed interim financial
statements have been prepared in accordance with IAS 34 "Interim
Financial Reporting" as contained in UK-adopted IFRS and give a
true and fair view of the assets, liabilities, financial position
and profit or loss of the Company as required by the FCA's
Disclosure Guidance and Transparency Rules DTR 4.2.4R;
and
b) the interim management report,
including the Chair's Statement and Investment Adviser's Report,
includes a fair review of the information required by DTR 4.2.7R
and DTR 4.2.8R.
This responsibility statement has
been approved by the Board of Directors.
For and on behalf of the Board of
Directors
Juliet Davenport
Director
19 June 2024
Independent Review Report to Atrato Onsite Energy
Plc
Conclusion
Based on our review, nothing has
come to our attention that causes us to believe that the condensed
set of financial statements in the half-yearly financial report for
the six months ended 31 March 2024 is not prepared, in all material
respects, in accordance with UK adopted International
Accounting Standards 34 and the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial
Conduct Authority.
We have been engaged by the
Company to review the condensed set of financial statements in the
half-yearly financial report for the six months ended 31 March
2024, which comprises of the Condensed Statement of Comprehensive
Income, the Condensed Statement of Financial Position, the
Condensed Statement of Changes in Equity, the Condensed Cash Flow
Statement, and the related notes.
Basis for conclusion
We conducted our review in
accordance with Revised International Standard on Review
Engagements (UK) 2410, "Review of Interim Financial Information
Performed by the Independent Auditor of the Entity" ("ISRE (UK)
2410 (Revised)"). A review of interim financial information
consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other
review procedures. A review is substantially less in scope than an
audit conducted in accordance with International Standards on
Auditing (UK) and consequently does not enable us to obtain
assurance that we would become aware of all significant matters
that might be identified in an audit. Accordingly, we do not
express an audit opinion.
As disclosed in note 2, the annual
financial statements of the Company are prepared in accordance
with UK adopted International Accounting Standards. The
condensed set of financial statements included in this half-yearly
financial report has been prepared in accordance
with UK adopted International Accounting Standard 34,
"Interim Financial Reporting".
Material uncertainty related to going
concern
We draw attention to Note
2 in the
half-yearly financial
statements, which indicates that the
Directors are exploring opportunities to optimise returns to
shareholders and as a result, it is
possible that this could result in the
sale of some or all of the Company's assets. As
stated in Note 2,
these events or conditions, along with
other matters as set forth in Note 2, indicate that a material
uncertainty exists that may cast
significant doubt on the Company's ability to continue as a going
concern.
Our conclusion is not modified in
respect of this matter.
Based on our review procedures,
which are less extensive than those performed in an audit as
described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the Directors
have inappropriately adopted the going concern basis of
accounting.
This conclusion is based on the
review procedures performed in accordance with ISRE (UK) 2410
(Revised), however future events or conditions may cause the
Company to cease to continue as a going concern.
Responsibilities of directors
The Directors are responsible for
preparing the half-yearly financial report in accordance with the
Disclosure Guidance and Transparency Rules of the United
Kingdom's Financial Conduct Authority.
In preparing the half-yearly
financial report, the Directors are responsible for assessing the
Company's ability to continue as a going concern, disclosing, as
applicable, matters related to going concern and using the going
concern basis of accounting unless the Directors either intend to
liquidate the Company or to cease operations, or have no realistic
alternative but to do so.
Auditor's responsibilities for the review of the financial
information
In reviewing the half-yearly
report, we are responsible for expressing to the Company a
conclusion on the condensed set of financial statement in the
half-yearly financial report. Our conclusion, including our
Conclusions relating to going concern, are based on procedures that
are less extensive than audit procedures, as described in the Basis
for Conclusion paragraph of this report.
Use of our report
Our report has been prepared in
accordance with the terms of our engagement to assist the Company
in meeting the requirements of the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial
Conduct Authority and for no other purpose. No person is
entitled to rely on this report unless such a person is a person
entitled to rely upon this report by virtue of and for the purpose
of our terms of engagement or has been expressly authorised to do
so by our prior written consent. Save as above, we do not accept
responsibility for this report to any other person or for any other
purpose and we hereby expressly disclaim any and all such
liability.
BDO LLP
Chartered Accountants
London, UK
19 June 2024
BDO LLP is a limited
liability partnership registered
in England and Wales (with registered number
OC305127).
Results
Condensed Statement of
Comprehensive Income
|
|
For the six-month period
ended 31 March 2024 (unaudited)
|
For the six-month
period
ended 31 March
2023
(unaudited)
|
|
Notes
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Fair
value of investments
|
8
|
-
|
(1,402)
|
(1,402)
|
-
|
3,990
|
3,990
|
Investment Income
|
3
|
3,715
|
-
|
3,715
|
2,473
|
-
|
2,473
|
Investment advisory fees
|
9
|
(684)
|
-
|
(684)
|
(692)
|
-
|
(692)
|
Other
expenses
|
4
|
(689)
|
-
|
(689)
|
(467)
|
-
|
(467)
|
Profit / (loss) on ordinary
activities before taxation
|
|
2,342
|
(1,402)
|
940
|
1,314
|
3,990
|
5,304
|
Taxation
|
5
|
-
|
-
|
-
|
-
|
-
|
-
|
Profit / (loss) on ordinary
activities after taxation
|
|
2,342
|
(1,402)
|
940
|
1,314
|
3,990
|
5,304
|
Profit /
(loss) per share
|
7
|
1.56
|
(0.93)
|
0.63
|
0.88
|
2.66
|
3.54
|
The "Total" column of the
Condensed Statement of Comprehensive Income is the profit and loss
account of the Company.
All revenue and capital items in
the above statement derive from continuing operations.
Profit / (loss) on ordinary
activities after taxation is also the "Total comprehensive profit /
(loss) for the Period."
The accompanying notes are an
integral part of these interim financial statements.
Incorporated in England and Wales
with registered number 13624999
Condensed Statement of
Financial Position
As at 31 March
2024
|
|
As
at
|
As at
|
|
|
31 March 2024
|
30 September 2023
|
|
|
(unaudited)
|
(audited)
|
|
Notes
|
£'000
|
£'000
|
Non-current
assets
|
|
|
|
Investments at fair value through profit or loss
|
8
|
134,417
|
99,289
|
Current assets
|
|
|
|
Cash and cash
equivalents
|
|
10,449
|
37,867
|
Trade and other
receivables
|
|
97
|
1,549
|
|
|
10,546
|
39,416
|
Current liabilities: amounts
falling due within one year
|
|
|
|
Trade and
other payables
|
|
(675)
|
(648)
|
Other
financial liabilities
|
|
(9,236)
|
-
|
|
|
(9,911)
|
(648)
|
Net current assets
|
|
635
|
38,768
|
Net assets
|
|
135,052
|
138,057
|
|
|
|
|
Capital and reserves
|
|
|
|
Share capital
|
10
|
1,500
|
1,500
|
Capital reduction
reserve
|
11
|
132,097
|
133,691
|
Revenue and capital
reserve
|
|
1,455
|
2,866
|
Shareholders' funds
|
|
135,052
|
138,057
|
Net
assets per Ordinary Shares (GBP pence)
|
12
|
90.0
|
92.0
|
The unaudited interim financial statements were
approved by the Board of Directors and authorised for issue on 19
June 2024 and were signed on its behalf by:
Juliet Davenport
Director
The accompanying notes are an
integral part of these interim financial
statements.
Incorporated in England and Wales
with registered number 13624999.
Condensed Statement of Changes in
Equity
For the six-months ended 31
March 2024 (unaudited)
|
Notes
|
Share
capital
£'000
|
Share premium
account
£'000
|
Capital reduction
reserve
£'000
|
Capital
reserve
£'000
|
Revenue
reserve
£'000
|
Total
£'000
|
Opening equity as at 30 September 2023
|
10
|
1,500
|
-
|
133,691
|
1,454
|
1,412
|
138,057
|
Total comprehensive income/(expense)
for the Period
|
|
-
|
-
|
-
|
(1,402)
|
2,342
|
940
|
Dividends paid
|
6
|
-
|
-
|
(1,594)
|
-
|
(2,351)
|
(3,945)
|
Closing equity as at
31 March 2024
|
|
1,500
|
-
|
132,097
|
52
|
1,403
|
135,052
|
For the period from 1 September 2022 to 31 March 2023
(unaudited)
|
Notes
|
Share
capital
£'000
|
Share premium
account
£'000
|
Capital reduction
reserve
£'000
|
Capital
reserve
£'000
|
Revenue
reserve
£'000
|
Total
£'000
|
Opening equity as at 30 September 2022
|
10
|
1,500
|
-
|
141,065
|
(2,251)
|
(1,188)
|
139,126
|
Total comprehensive income/(expense)
for the Period
|
|
-
|
-
|
-
|
3,990
|
1,314
|
5,304
|
Dividends paid
|
6
|
-
|
-
|
(3,780)
|
-
|
-
|
(3,780)
|
Closing equity as at
31 March 2023
|
|
1,500
|
-
|
137,285
|
1,739
|
126
|
140,650
|
|
|
|
|
|
|
|
|
The Company's distributable
reserves consist of the capital reduction reserve, capital reserves
attributable to realised gains and revenue reserve and totals
£133.6 million at 31 March 2024 (March 2023: £139.2). All capital
reserves are unrealised.
The accompanying notes are an
integral part of these interim financial
statements.
Condensed Statement of Cash
Flows
|
For the six months ended 31
March 2024 (unaudited)
|
For the six months ended 31
March 2023 (unaudited)
|
|
Notes
|
£'000
|
£'000
|
Operating activities cash flows
|
|
|
|
Profit on ordinary activities
before taxation
|
|
940
|
5,304
|
Adjustments for:
|
|
|
|
Movement in fair value of
investments
|
8
|
1,402
|
(3,990)
|
Interest income
|
3
|
(3,715)
|
(2,473)
|
(Increase) / Decrease in trade and
other receivables
|
|
(41)
|
1,991
|
Increase / (Decrease) in trade and
other payables
|
|
26
|
(46)
|
Net cash (outflow) / inflow from operating
activities
|
|
(1,388)
|
786
|
Investing activities
|
|
|
|
Purchase of investments
|
|
(37,640)
|
(11,691)
|
Repayment of shareholder
loans
|
|
3,157
|
-
|
Decrease in fixed
deposit
|
|
-
|
20,000
|
Decrease in intercompany
receivable
|
|
1,479
|
-
|
Interest income received
|
|
1,669
|
1,935
|
Net cash (outflow) / inflow from investing
activities
|
|
(31,335)
|
10,244
|
Financing activities
|
|
|
|
Working capital
financing
|
|
9,250
|
-
|
Dividends paid
|
6
|
(3,945)
|
(3,780)
|
Net cash outflow from financing activities
|
|
5,305
|
(3,780)
|
(Decrease) / Increase in cash
|
|
(27,418)
|
7,250
|
Cash and cash equivalents at beginning of the
Period
|
|
37,867
|
69,361
|
Cash and cash equivalents at end of the
Period
|
|
10,449
|
76,611
|
|
|
|
|
|
|
|
|
| |
The accompanying notes are an
integral part of the interim financial statements.
Notes to the condensed unaudited financial
statements
For the six months ended 31 March
2024
1
General information
Atrato Onsite Energy Plc (the
"Company") is a
closed-ended investment company domiciled and incorporated in the
United Kingdom on 16 September 2021 with registered number
13624999. The registered office of the Company is 1 King William
Street, London, United Kingdom, EC4N 7AF. Its share capital is
denominated in Pounds Sterling (GBP) and currently consists of one
class of ordinary shares. The shares are publicly traded on the
London Stock Exchange under a premium listing. These unaudited interim financial statements of the Company
are for the six months ended 31 March 2024 and have been prepared
on the basis of the accounting policies set out below. The
financial statements comprise only the results of the Company as
its investment in Atrato Onsite Energy Holdco Limited
("Holdco") is measured at
fair value as detailed in the significant accounting policies
below. The Company and its subsidiaries invest in a diversified portfolio of onsite energy assets
generally on the rooftop of UK commercial buildings, which benefit
from long-term growing income streams with limited exposure to
wholesale power prices.
Atrato Partners Limited (the
"Investment Adviser")
provides investment advisory services and JTC Global AIFM Solution
Limited as the AIFM provides investment management services to the
Company, each under the terms of the agreement between it and the
Company.
2
Basis of preparation
The interim financial statements included in this report have been prepared in accordance with UK adopted IAS 34
"Interim Financial Reporting". The interim financial statements
have been prepared under the historical cost convention, as
modified by the revaluation of financial assets and financial
liabilities at fair value through profit and
loss.
The interim financial statements
have also been prepared as far as is relevant and applicable to the
Company in accordance with the Statement of Recommended Practice
("SORP") "Financial
Statements of Investment trust companies and Venture Capital
Trusts" issued in July 2022 by the Association of Investment
Companies ("AIC").
The interim financial statements
are prepared on the historical cost basis, except for the
revaluation of certain financial instruments at fair value through
profit and loss. The principal accounting policies adopted are set
out below. These policies have been consistently applied throughout
the six months to 31 March 2024.
The interim financial statements
are prepared on a going concern basis in accordance with UK adopted
international accounting standards (International Financial
Reporting Standards ("IFRS") and International Accounting Standards
("IAS")) and interpretations in force at the reporting date. From 1
January 2023, IAS 1 has been amended introducing the concept of
Material Accounting Policy Information. The Company has performed a
review of the existing accounting policies and updated where
relevant. Other new standards coming into force during the year and
future standards that come into effect after the year-end have not
had a material impact on these financial statements.
The Company has carried out an
assessment of accounting standards, amendments and interpretations
that have been issued by the IASB and that are effective for the
current reporting period. The Company has determined that the
transitional effects of the standards do not have a material
impact.
The currency of the primary
economic environment in which the Company operates and where its
investments are located (the functional currency) is Pounds
Sterling. The financial statements are presented in Pounds Sterling
and rounded to the nearest thousand.
Estimates and underlying
assumptions are reviewed regularly on an on-going basis. Revisions
to accounting estimates are recognised in the period in which the
estimates are revised and in any future periods affected. The
significant estimates, judgments or assumptions for the
Period are set out below under
Critical accounting judgements, estimates and
assumptions.
Going concern
The Directors have adopted the
going concern basis in preparing the interim financial statements.
The following is a summary of the Directors' assessment of the
going concern status of the Company.
The Directors have a reasonable
expectation that the Company has adequate resources to continue in
operational existence for at least twelve months from the date of
this report. In reaching this conclusion, the Directors have
considered the liquidity of the Company's portfolio of investments
as well as its cash position, income, and expense flows. The
Company's net assets at 31 March 2024 were £135.1 million (30
September 2023: £138.1 million). As at 31 March 2024, the Company
held £10.4 million (30 September 2023: £37.9 million) in cash. The
total expenses for the period ended 31 March 2024 were £1.4 million
(31 March 2023: £1.2 million).
Post the balance sheet date the
Company acquired a portfolio of
operational residential sites, four operational sites, two ground
mount and two rooftop for £14.0 million, out of the cash held
at the period end and a further £7.5m utilisation of the RCF.
At the date of approval of this report, based on
the aggregate of investments, capital commitments and cash held,
the Company has cover for its operating expenses.
Future revenue is principally
expected to be derived through loan interest and dividends from
profit generated by underlying investments held within the SPVs.
Having regard to the current portfolio combined with current cash
balances, the Directors consider the Company to be in a position to
meet its current and future liabilities over the next 12-month
period.
In light of the ongoing conflict of
Russia, Ukraine and Middle East, the Directors have considered any
potential impact on the portfolio's operations and procurement
processes, and do not foresee any material adverse impact for next
12 months. Energy prices can fluctuate as a result of these
conflicts, which the Directors maintain under close review;
however, no material adverse impact on the business is
expected.
Material uncertainty in relation to going
concern
The Company continues to deliver
on its investment objective of providing a progressive dividend
through its highly contracted and growing income streams.
However, the Directors have also remained
focused on initiatives to address the discount to NAV at which the
Company's shares have traded and to place the fund in the best
possible financial position to support shareholders'
interests. Considering this and the
pending discontinuation vote due in the first quarter of 2025,
the Directors are working with the Investment Adviser to
explore opportunities to optimise the returns to shareholders.
These include joint venture partnership, recycling capital from
operational assets into installation assets to provide enhanced
capital growth or earlier capital returns to shareholders.
It is possible that one of the
outcomes could result in the sale of some or all of the Company's
assets. As a result, a material uncertainty exists which may cast
significant doubt on the Company's ability to continue as a going
concern. In such an event, the Company will realise its assets and
use the funds to discharge its liabilities rather than discharge
the liabilities in the normal course of business. However, there is
no certainty around timing, outcome, and effects of these
opportunities, if any, and therefore the Directors have prepared
the interim financial statements on a going concern
basis.
The interim financial statements
do not include the adjustments that would be required should the
going concern basis of preparation no longer be
appropriate.
Critical accounting judgments, estimates and
assumptions
The preparation of the interim
financial statements requires management to make judgments,
estimates and assumptions that affect the application of accounting
policies and the reported amount of assets, liabilities, income,
and expenses. Estimates, by their nature, are based on judgment and
available information; hence actual results may differ from these
judgments, estimates and assumptions. The estimates and assumptions
that have a significant risk of causing a material adjustment to
the carrying value of assets and liabilities are those used to
determine the fair value of the investments. There have been no
changes to the significant estimates, judgements, and assumptions
to those set out on pages 94 to 97 of the
2023 Annual Report; a summary of these is provided
below:
Key estimation: Fair value estimation for investments at fair
value
The Company's investments in
unquoted investments are valued by reference to valuation
techniques approved by the Directors and in accordance with the
International Private Equity and Venture Capital Valuation
Guidelines.
Discounted cash flow
("DCF") models are used to
determine the fair value of the underlying assets in HoldCo. The
value of HoldCo includes any working capital not accounted for in
the DCF models, such as cash or entity level payable and
receivables and bank debt at Holdco level. Unobservable inputs used
within the DCF models include the discount rate. An increase or
decrease in the discount rate would lead to a corresponding
decrease or increase in the fair value of the investments. The
Company's investments at fair value are not traded in active
markets.
Key
judgement: Basis of non-consolidation
The Company has adopted the
amendments to IFRS 10, which states that investment entities should
measure all of their subsidiaries that are themselves investment
entities at fair value.
The Company owns 100% of its
subsidiary HoldCo. The Company invests in special purpose vehicles
through its investment in HoldCo. The Company and HoldCo meet the
definition of an investment entity as described by IFRS 10. Under
IFRS 10 investment entities measure subsidiaries at fair value
rather than being consolidated on a line-by-line basis, meaning
HoldCo's working capital balances are included in the fair value of
the investment rather than in the Company's current assets. HoldCo
has one investor, which is the Company. However, in substance,
HoldCo is investing the funds of the investors of the Company on
its behalf and is effectively performing investment management
services on behalf of many unrelated beneficiary
investors.
Key
judgement: Characteristics of an investment
entity
Under the definition of an
investment entity, the entity should satisfy all three of the
following tests:
a) The Company obtains
funds from one or more investors for the purpose of providing those
investors with investment management services;
b) The Company commits
to its investors that its business purpose is to invest funds
solely for returns from capital appreciation, investment income, or
both (including having an exit strategy for investments);
and
c) The Company measures
and evaluates the performance of substantially all of its
investments on a fair value basis.
In assessing whether the Company
meets the definition of an investment entity set out in IFRS 10,
the Directors note that:
a) The Company has
multiple investors and obtains funds from a diverse group of
shareholders who would otherwise be less able to individually
invest in renewable energy and/ or infrastructure
assets;
b) The Company's
purpose is to invest funds for both investment income and capital
appreciation. HoldCo and the future SPVs will have indefinite
lives. However, the underlying assets do not have unlimited life
and have minimal residual value at the end of that life, meaning
they will not be held indefinitely. The Company intends to hold the
renewable assets on a long-term basis to achieve its investment
objectives. Depending on the circumstances of each renewable asset,
decisions will be made whether to extend leases and repower assets
as they approach the end of their useful life or sell the assets to
interested parties who may take a more optimistic view of asset
value; and
c) The Company measures
and evaluates the performance of all of its investments on a fair
value basis, which is the most relevant for investors in the
Company. The Directors use fair value information as a primary
measurement to evaluate the performance of all the investments and
in decision-making.
The Directors are of the opinion
that the Company meets all the typical characteristics of an
investment entity and therefore meets the definition set out in
IFRS 10.
The Directors agree that
investment entity accounting treatment reflects the Company's
activities as an investment trust.
The Directors believe the
treatment outlined above provides the most relevant information to
investors.
Segmental reporting
The Board is of the opinion that
the Company is engaged in a single segment of business, investment
in renewable energy infrastructure assets to generate investment
returns whilst preserving capital. The financial information used
by the Board to manage the Company presents the business as a
single segment.
New accounting policies
Other financial liabilities, are
short term liabilities payable on demand. The balances relate to
working capital funding within the group to optimise interest
earned on cash balances at the Company level.
Adoption of new and revised standards
At the date of approval of these
financial statements, there were no new or revised standards or
interpretations relevant to the Company which had come into
effect.
3
Investment Income
|
For the six-month
period
ended 31 March 2024
(unaudited)
|
For the six-month
period
ended 31 March 2023
(unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Interest
income from investments
|
3,500
|
-
|
3,500
|
1,666
|
-
|
1,666
|
Interest
income from deposits
|
215
|
-
|
215
|
807
|
-
|
807
|
Total
investment income
|
3,715
|
-
|
3715
|
2,473
|
-
|
2,473
|
4
Operating expenses
|
For the six-month period
ended 31 March 2024 (unaudited)
|
For the six-month period
ended 31 March 2023 (unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Investment management fees
|
684
|
-
|
684
|
692
|
-
|
692
|
Director's fees
|
87
|
-
|
87
|
88
|
-
|
88
|
Company's
auditors' fees:
|
|
|
|
|
|
|
- in respect of audit
services
|
107
|
-
|
107
|
39
|
-
|
39
|
- in respect of non-audit
services
|
57
|
-
|
57
|
45
|
-
|
45
|
Other
operating expenses
|
438
|
-
|
438
|
295
|
-
|
295
|
Total
operating expenses
|
1,373
|
-
|
1,373
|
1,159
|
-
|
1,159
|
5
Taxation
(a) Analysis of charge /(credit) in the
period
|
For the six-month
period
|
For the six-month
period
|
|
ended 31 March 2024
(unaudited)
|
ended 31 March 2023
(unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Corporation tax
|
586
|
(350)
|
236
|
289
|
878
|
1,167
|
Tax charge/(credit) for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
(b) Factors affecting total tax charge for the
period:
The effective UK corporation tax
rate applicable to the Company for the year is 25% (2023: 19%). The
tax charge/(credit) differs from the charge/(credit) resulting from
applying the standard rate of UK corporation tax for an investment
trust company. The differences are explained below:
|
For the six-month
period
|
For the six-month
period
|
|
ended 31 March 2024
(unaudited)
|
ended 31 March 2023
(unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Profit/(loss) before
taxation
|
2,342
|
(1,402)
|
940
|
1,314
|
3,990
|
5,304
|
Corporation tax at 25%
(PY:19%)
|
586
|
(350)
|
236
|
289
|
878
|
1,167
|
Effects of:
|
|
|
|
|
|
|
Profit / (loss) on investments held at fair value not
taxable
|
-
|
350
|
350
|
-
|
(878)
|
(878)
|
Expenses not deductible for tax
purposes
|
1
|
-
|
1
|
-
|
-
|
-
|
Utilised losses
|
(75)
|
-
|
(75)
|
-
|
-
|
-
|
Interest distributions
|
(512)
|
-
|
(512)
|
(289)
|
-
|
(289)
|
Total tax charge/(credit) for the period
|
-
|
-
|
-
|
-
|
-
|
-
|
6
Dividends
|
For the six-month
period
|
|
ended 31 March 2024
(unaudited)
|
|
Pence per Ordinary
Share
|
Capital reduction
reserve
|
Revenue
reserve
|
Total
|
Q4 2023 Dividend - paid 18
December 2023
|
1.26
|
567
|
1,323
|
1,890
|
Q1 2024 Dividend - paid 1 March
2024
|
1.37
|
1,027
|
1,028
|
2.055
|
Total
|
2.63
|
1,594
|
2,351
|
3,945
|
The Company paid the following dividends during
the Period ended 31 March
2023:
|
For the six-month
period
|
|
ended 31 March 2023
(unaudited)
|
|
Pence per Ordinary
Share
|
Capital reduction
reserve
|
Revenue
reserve
|
Total
|
Q4 2022 Dividend - paid 16
December 2022
|
1.26
|
1,890
|
-
|
1,890
|
Q1 2023 Dividend - paid 24
February 2023
|
1.26
|
1,890
|
-
|
1,890
|
Total
|
2.52
|
3,780
|
-
|
3,780
|
On 23 April 2024, the Company
declared an interim dividend in respect of the period from 1
January 2024 to 31 March 2024 of 1.37 pence per Ordinary
Share, paid on 28 May 2024 to Shareholders on the register on 3 May
2024. On that record date, the number of Ordinary Shares in issue
were 150,000,000 and the total dividend paid to Shareholders
amounted to £2.06 million. The dividend has not been included
as a liability at 31 March 2024.
7
Earnings per share
Earnings per Ordinary Share is
calculated by dividing the profit attributable to equity
shareholders of the Company by the weighted average number of
Ordinary Shares in issue during the period as follows:
|
For the six-month
period
|
For the six-month
period
|
|
ended
31 March 2024
(unaudited)
|
ended
31 March 2023
(unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
Profit/(loss) attributable to the
equity holders of the Company (£'000)
|
2,342
|
(1,402)
|
940
|
1,314
|
3,990
|
5,304
|
Weighted average number of
Ordinary Shares in issue (000)
|
150,000
|
150,000
|
150,000
|
150,000
|
150,000
|
150,000
|
Earnings/(loss) per Ordinary Share (pence) - basic and
diluted
|
1.56
|
(0.93)
|
0.63
|
0.88
|
2.66
|
3.54
|
8
Investment held at fair value through profit or
loss
As set out in note 2, the Company
accounts for its interest in its wholly owned direct subsidiaries
as an investment at fair value through profit and loss.
|
As at
31 March
2024
|
As at
30
September
2023
|
|
£'000
|
£'000
|
(a) Summary of valuation
|
|
|
Analysis of closing
balance:
|
|
|
Investment at fair value through
profit or loss
|
134,417
|
99,289
|
Total investment
|
134,417
|
99,289
|
(b) Movements during the year:
|
|
|
Opening balance of
investment
|
99,289
|
47,105
|
Additions, at cost
|
37,640
|
46,796
|
Capitalised interest
|
2,047
|
2,392
|
Closing balance of investment
|
138,976
|
96,293
|
Revaluation of investments to fair
value:
|
|
|
Realised gain on sale of
contract
|
-
|
(709)
|
Repayment of shareholder's
loan
|
(3,157)
|
-
|
Unrealised movement in fair value
of investment
|
(1,402)
|
3,705
|
Fair value of investment
|
134,417
|
99,289
|
(c) Profits or loss on investment in the
year:
|
|
|
Unrealised movement in fair value
of investment
|
(1,402)
|
3,705
|
(Loss) / profit on investment
|
(1,402)
|
3,705
|
The investments made in underlying
assets are carried at fair value through profit and loss. The
investments are typically made through a combination of shareholder
loans and equity into the SPVs which own the underlying asset. The
nominal value of the shareholder loan investments as at 31 March
2024 was £63.1 million (March 2023: £52.6 million).
Fair value of portfolio of assets
The Investment Adviser has carried
out fair market valuations of the investments as at 31 March
2024.
The Directors have satisfied
themselves as to the methodology used, the discount rates applied
and the valuation. All investments are in renewable energy assets
and are valued using a discounted cash flow methodology. The
Company's holding of an investment represents its interest in both
the equity and debt instruments of the investment. The equity and
debt instruments are valued as a whole using a blended discount
rate. The weighted average cost of capital
applied to the portfolio of assets range from 6.95% to
9.50%.
In addition, Mazars LLP acted as
independent valuer, providing a fair value for all of the
investments held within the portfolio.
The Company has modelled the
enacted corporation tax rates of 25%.
Inflation rates are assumed based
on available market forecasts of the inflation indices (RPI and
CPI, where applicable) and capped where a cap exists in the
contract.
The power price forecasts used in
the valuations are based on market forward prices from independent
and widely used market expert consultants' relevant
technology-specific capture price forecasts for each
asset.
Fair value of intermediate holding company
The other net assets in the
intermediate holding company substantially comprise working capital
balances; therefore, the Directors consider
the fair value to be equal to the book values. The sensitivity to
unobservable inputs is based on management's expectations of
reasonably possible shifts in these inputs. The valuation
sensitivity of each assumption is shown in Note 13.
9
Investment advisory fee
|
For the six-month
period
|
For the six-month
period
|
|
ended 31 March 2024
(unaudited)
|
ended 31 March 2023
(unaudited)
|
|
Revenue
|
Capital
|
Total
|
Revenue
|
Capital
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
£'000
|
Investment advisory fee
|
684
|
-
|
684
|
692
|
-
|
692
|
The Investment Advisory Agreement
("IAA") dated 1
November 2021 between the Company and Atrato Partners Limited as
the Investment Adviser and JTC Global AIFM Solutions Limited as the
AIFM, appointed the Investment Adviser to act as the Company's
investment adviser. The AIFM has been appointed pursuant to the
AIFM agreement dated 1 November 2021 between the AIFM and the
Company as the alternative investment fund manager for the purposes
of the AIFM Directive. Accordingly, the AIFM is responsible for
providing portfolio management and risk management services to the
Company.
The fees relating to the IAA are
set out in the Investment Adviser report and the Annual Report for
30 September 2023. No amendments have been made during the
period.
10
Share capital
|
As at 31 March 2024
(unaudited)
|
As at 30 September
2023
(audited)
|
Allotted, issued, and fully paid:
|
Number of
shares
|
Nominal value of shares
(£)
|
Number of
shares
|
Nominal
value
of shares
(£)
|
Opening Balance
|
1,500,000
|
1,500,000
|
150,000,000
|
1,500,000
|
Allotted upon incorporation
|
|
|
|
|
Shares of £0.01 each (ordinary
shares)
|
-
|
-
|
-
|
-
|
Issue of redeemable preference
shares
|
-
|
-
|
-
|
-
|
Allotted / redeemed following admission to
LSE
|
|
|
|
|
Shares issued
|
-
|
-
|
-
|
-
|
Initial redeemable preference
shares redeemed
|
-
|
-
|
-
|
-
|
Closing balance
|
1,500,000
|
1,500,000
|
150,000,000
|
1,500,000
|
Ordinary shareholders are entitled
to all dividends declared by the Company and to all of the
Company's assets after repayment of its borrowings and ordinary
creditors. Ordinary shareholders have the right to vote at meetings
of the Company. All Ordinary Shares carry equal voting
rights.
11
Capital reduction reserve
As indicated in the Prospectus,
following admission of the Company's shares to trading on the LSE,
the Directors applied to the Court and obtained a judgement on 28
January 2022 to cancel the amount standing to the credit of the
share premium account of the Company.
During the period, £1.6 million
(2023: £3.8 million) of dividends have been paid out of the
reserve, reducing the reserve to £132.1 million (2023: £137.3
million).
12
Net assets per Ordinary Share
|
As at
31 March 2024
(unaudited)
|
As at
30 September 2023
(audited)
|
Total shareholders' equity
(£'000)
|
135,052
|
138,057
|
Number of Ordinary Shares in issued
('000)
|
1,500
|
1,500
|
Net asset value per Ordinary Share (pence)
|
90.0
|
92.0
|
13
Financial instruments by category
The Company held the following
financial instruments at fair value at 31 March 2024. There have
been no transfers of financial instruments between levels of the
fair value hierarchy. There are no non-recurring fair value
measurements.
a. Financial
instruments by category
|
As at 31 March 2024
(unaudited)
|
|
Financial assets at fair
value through profit & loss
|
Financial asset at amortised
cost
|
Financial liabilities at
amortised cost
|
Total
|
|
£'000
|
£'000
|
£'000
|
£'000
|
Non-current assets
|
|
|
|
|
Investments at fair value through
profit or loss (Level 3)
|
134,417
|
-
|
-
|
134,417
|
Current assets
|
|
|
|
|
Other receivables and
prepayments
|
-
|
97
|
-
|
97
|
Fixed deposits
|
-
|
-
|
-
|
-
|
Cash and cash
equivalents
|
-
|
10,449
|
-
|
10,449
|
Total assets
|
134,417
|
10,546
|
-
|
144,963
|
Current liabilities
|
|
|
|
|
Trade and other
payables
|
-
|
-
|
(9,911)
|
(9,911)
|
Total liabilities
|
-
|
-
|
(9,911)
|
(9,911)
|
Net assets
|
134,417
|
10,546
|
(9,911)
|
135,052
|
|
As at 30 September 2023
(audited)
|
|
Financial assets at fair
value through profit & loss
|
Financial asset at amortised
cost
|
Financial liabilities at
amortised cost
|
Total
|
|
|
£'000
|
£'000
|
£'000
|
£'000
|
|
Non-current assets
|
|
|
|
|
|
Investments at fair value through
profit or loss (Level 3)
|
99,289
|
-
|
-
|
99,289
|
|
Current assets
|
|
|
|
|
|
Other receivables and
prepayments
|
-
|
1,549
|
-
|
1,549
|
|
Fixed deposits
|
-
|
-
|
-
|
-
|
|
Cash and cash
equivalents
|
-
|
37,867
|
-
|
37,867
|
|
Total assets
|
99,289
|
39,416
|
-
|
138,705
|
|
Current liabilities
|
|
|
|
|
|
Trade and other
payables
|
-
|
-
|
(648)
|
(648)
|
|
Total liabilities
|
-
|
-
|
(648)
|
(648)
|
|
Net assets
|
99,289
|
39,416
|
(648)
|
138,057
|
|
The above tables provide an
analysis of financial instruments that are measured subsequent to
their initial recognition at fair value as follows:
· Level 1: fair value measurements are those derived from
quoted prices (unadjusted) in active markets for identical assets
or liabilities;
· Level 2: fair value measurements are those derived from
inputs other than quoted prices included within Level 1 that are
observable for the assets or liability, either directly (i.e. as
prices) or indirectly (i.e. derived from prices; and
· Level 3: fair value measurements are those derived from
valuation techniques that include inputs to the asset or liability
that are not based on observable market data (unobservable
inputs).
There were no Level 1 assets or
liabilities during the period. There were no transfers between
Level 1 and 2, Level 1 and 3 or Level 2 and 3 during the
period.
The Company's financial assets and
liabilities as summarised above are expected to be realised within
12 months of the reporting date, excluding those held in FVTPL. The
financial assets and financial liabilities measured at amortised
cost's carrying amount is approximated to its fair value which is
classified at level 3 at the fair value hierarchy.
The Level 3 fair value measurements
derive from valuation techniques that include inputs to the asset
or liability that are not based on observable market data
(unobservable inputs).
Reconciliation of Level 3 fair value measurement of financial
assets and liabilities
An analysis of the movement between
opening and closing balances of the investments at fair value
through profit or loss is given in note 8.
The fair value of the investments
at fair value through profit or loss includes the use of Level 3
inputs. Please refer to note 4 for details of the valuation
methodology and sensitivities.
Valuation sensitivities
The sensitivities are based on the
existing portfolio of assets as at 31 March 2024. For each of the
sensitivities shown, it is assumed that potential changes occur
independently with no effect on any other assumption.
The below figures show the impact
to NAV of changes to the key input assumptions (sensitivities). The
sensitivities are based on the existing portfolio of assets as at
31 March 2024.
Discount rate
The discount rate is considered
the most significant unobservable input through which an increase
or decrease would have a material impact on the fair value of the
investments at a fair value through profit or loss.
The weighted average cost of capital applied to
the portfolio of assets range from 6.95% to 9.50%.
An increase of 0.5% in the
discount rate would cause a decrease in total portfolio value of
3.7 pence per Ordinary Share and a decrease of 0.5% would cause an
increase of 4.0 pence per Ordinary Share.
|
31
March 2024
|
30
September 2023
|
Discount Rate
|
+ 50
bps
|
- 50
bps
|
+ 50
bps
|
- 50
bps
|
Increase/(decrease) in NAV
(£m)
|
(5.6)
|
6.0
|
(5.1)
|
5.5
|
NAV per share
|
86.3p
|
94p
|
88.7p
|
95.7p
|
NAV per share change
|
(3.7p)
|
4.0p
|
(3.4p)
|
3.7p
|
Change
|
(4.1)%
|
4.4%
|
(3.7)%
|
4.0%
|
Energy production
Energy production, as measured in
MWh per annum, assumed in the DCF valuations is based on a P50
energy yield profile, representing a 50% probability that the
energy production estimate will be met or exceeded over time. An
independent engineer has derived this energy yield estimate for
each asset by considering a range of irradiation, weather data,
ground-based measurements and design/site-specific loss factors
including module performance, module mismatch, inverter losses, and
transformer losses, among others. The P50 energy yield case
includes a 0.5% annual degradation through the entirety of the
useful life. In addition, the P50 energy yield case includes an
assumption of availability, which ranges from 99% to 100%, as
determined reasonable by an independent engineer at the time of
underwriting the asset.
Solar assets are subject to
variation in energy production over time. An assumed "P90" level of
energy yield (i.e. a level of energy production that is below the
"P50", with a 90% probability of being exceeded) would cause a
decrease in the total portfolio valuation of 9.4 pence per Ordinary
Share, while an assumed "P10" level of power output (i.e. a level
of energy production that is above the "P50", with a 10%
probability of being achieved) would cause an increase of 8.0 pence
per Ordinary Share in the total portfolio valuation.
|
31
March 2024
|
30
September 2023
|
Energy production
|
P90
|
P10
|
P90
|
P10
|
Increase/(decrease) in NAV
(£m)
|
(13.1)
|
12.0
|
(8.5)
|
8.1
|
NAV per share
|
81.3p
|
98.0p
|
86.4p
|
97.5p
|
NAV per share change
|
(8.8p)
|
8.0p
|
(5.6p)
|
5.4p
|
Change
|
(9.7)%
|
8.9%
|
(6.1)%
|
5.9%
|
Power price curve
The power price forecasts for each
asset are based on a number of inputs. The sensitivity assumes a
10% increase or decrease in power prices relative to the base case
for each year of the asset life.
For an increase in power prices by
10%, there is a 3.2 pence per Ordinary Share increase in NAV, while
a decrease of 10% in power prices has a decrease of 3.8 pence per
Ordinary Share in NAV, due to low merchant power price
exposure.
|
31
March 2024
|
30
September 2023
|
Power price curve
|
+10%
|
-10%
|
+10%
|
-10%
|
Increase/(decrease) in NAV
(£m)
|
4.7
|
(5.7)
|
(5.6)
|
5.5
|
NAV per share
|
93.2p
|
86.2p
|
88.3p
|
95.7p
|
NAV per share change
|
3.2p
|
(3.8p)
|
(3.7p)
|
3.7p
|
Change
|
3.5%
|
(4.3%)
|
(4.0)%
|
4.0%
|
Inflation
The sensitivity assumes a 50bps
increase or decrease in inflation relative to the base case for
each year of the asset life.
A 50bps increase in inflation
would result in a 2.6% increase in NAV while a 50bps decrease would
decrease the NAV by 2.7%.
|
31
March 2024
|
30
September 2023
|
Inflation
|
+50bps
|
-50bps
|
+50bps
|
-50bps
|
Increase/(decrease) in NAV
(£m)
|
3.4
|
(3.6)
|
4.6
|
(4.3)
|
NAV per share
|
92.3p
|
87.6p
|
95.1p
|
89.2p
|
NAV per share change
|
2.3p
|
(2.4p)
|
3.1p
|
(2.9p)
|
Change
|
2.6%
|
(2.7)%
|
3.3%
|
(3.1)%
|
14
Financial risk management
The Company's activities expose it
to a variety of financial risks, including credit, liquidity, and
market risk. These financial risks form part of the Company's
overall principal risks.
The Investment Adviser, AFIM and
the Administrator report to the Board on a bi-annual basis and
provide information to the Board, which allows it to monitor and
manage financial risks relating to the Company's
operations.
Credit risk
Credit risk is the risk that
financial loss arises from the failure of a customer or
counterparty to meet its obligations under a contract.
As at 31 March 2024, the Company's
exposure to credit risk in the form of shareholder loans, accrued
shareholder loan interest, the cash and cash equivalents and other
receivables. Appropriate credit checks are required to be made on
all counterparties to the Company. Cash is held in accounts with
HSBC Bank Plc, which has a credit rating as per Moody's Investor
Services of A1. During the six months ended 31 March 2024, there
are no balances past due or impaired.
The Company's credit risk exposure
in relation to cash holdings is minimised by dealing with financial
institutions with investment grade credit rating. The Company has
no significant credit exposure at the current time. Exposure in
relation to customers will be mitigated by a combination of due
diligence procedures performed at inception of a PPA and diversity
of counterparties in the portfolio. While credit risk in
relation to contractors employed is mitigated through due diligence
procedures performed at inception, the length of contract and the
available alternative contractors. Where the strength of an asset
vendor is insufficient, warranty and indemnity insurance is
purchased.
Shareholder loans provided to
Holdco and flowed down to project companies, is secured through the
procedures performed in monitoring the credit risk of PPA
counterparties. These procedures work to mitigate the credit risk
that arises due to intercompany lending to the underlying
investments. The Company regularly reviews the future cash flows
and valuations of the investee companies to gain comfort as to the
recoverability of the loans. No balances are past due or
impaired.
Liquidity risk
The objective of liquidity
management is to ensure that all commitments which are required to
be funded can be met out of readily available and secure sources of
funding.
The Company's approach to managing
liquidity is to ensure, as far as possible, that it will always
have sufficient liquidity to meet its liabilities when due, under
both normal and stressed conditions, without incurring unacceptable
losses or risking damage to the Company's reputation.
The Company's trade and other
payables with third parties at the reporting date are considered
operational in nature and are due and payable within 12 months of
the reporting date. As at 31 March 2024, the Company has financial
assets of cash and cash equivalents without contractual maturity
that can meet the current expected financial liabilities and £10
million available facility from the RCF.
Market risk
Market risk is the risk that
changes in market prices, such as interest and foreign currency
rates and property valuations, will affect the Company's financial
performance or the value of its holdings of financial instruments.
The objective is to minimise market risk through managing and
controlling these risks within acceptable parameters, whilst
optimising returns.
The Company uses financial
instruments in the ordinary course of business, and also incurs
financial liabilities, in order to manage market risks.
Interest rate risk
Interest rate risk is the risk
that the value of a financial instrument will fluctuate due to
changes in market interest rates. The
Company's interest rate risk on interest bearing financial assets
is limited to interest earned on fixed cash deposits.
The Company's interest rate risk
on interest bearing financial assets is limited to interest earned
on fixed cash deposits. The Interest Rate Benchmark Reform - Phase
2 did not have a material impact on the Company's reported results
as the exposure to interest rates is limited to interest earned on
fixed deposits.
Price risk
Price risk is defined as the risk
that the fair value of a financial instrument held by the Company
will fluctuate.
Currency risk
Currency risk is the risk that the
value of a financial instrument will fluctuate due to changes in
foreign exchange rates. All transactions during the current period
were denominated in GBP, thus no foreign exchange differences
arose.
Capital management
The Company manages its capital to
ensure that it will be able to continue as a going concern while
maximising the return to its shareholders through the optimisation
of the debt and equity balances. The Company is not subject to any
externally imposed capital requirements.
Equity includes all capital and
reserves of the Company that are managed as capital.
15
Related party transactions
Following admission of the
Ordinary Shares (refer to note 10), the Company and the Directors
are not aware of any person who, directly or indirectly, jointly,
or severally, exercises or could exercise control over the Company.
The Company does not have an ultimate controlling party.
Details of related parties are set
out below.
a)
Accounting, secretarial and
directors
Atrato Partners Limited has been
appointed to act as an administrator for the Company under the
terms of the IAA, more details are set out below.
Hanway Advisory Limited was
appointed as the secretary of the Company on 1st April
2024, prior to this Apex Secretaries LLP held the position.
Juliet Davenport, Chair of the
Board of Directors of the Company, is paid director's remuneration
of £50,000 per annum (2023: £50,000), Faye Goss is paid director's
remuneration of £37,500 per annum (2023: £37,500), Duncan Neale is
paid director's remuneration of £37,500 per annum (2023: £37,500)
with an additional £5,000 per annum (2023: £5,000) for
responsibilities as Audit Committee Chair. Total directors'
remuneration of £65,000 was incurred in respect to the Period. Any
expenses incurred by Directors which are related to business are
also reimbursed.
The interests (all of which are or
will be beneficial unless otherwise stated) of the current
Directors in the ordinary share capital of the Company as at 31
March 2024 were as follows:
Director
|
Shares
held at 31 March 2024
|
Shares
held at 30 September 2023
|
Juliet
Davenport
|
50,000
|
33,000
|
Faye
Goss
|
20,000
|
20,000
|
Duncan
Neale
|
2,980
|
2,980
|
There have been no changes to the
above holdings since the period end.
b)
Investment
Adviser
Fees payable to the Investment
Adviser by the Company under the IAA are shown in the Statement of
Comprehensive Income and detailed in note 9.
During the Period, investment
advisory fees amounted to £655,840 (31 March 2023: £702,053) with
£244,692 outstanding and payable as at 31 March 2024.
Details of the direct and indirect
interests of the Directors of the Investment Adviser and their
close families in the ordinary shares of one pence each in the
Company at 31 March 2024 were as follows:
Benedict Luke Green, a director of
the Investment Adviser: 760,735 shares (0.51 % of the issued share
capital).
Steve Peter Windsor, a director of
the Investment Adviser: 1,496,381 shares (1.00 % of the issued share
capital).
Gurpreet Gujral, Fund manager of
the Investment Adviser: 100,544 shares (0.07% of issued share
capital).
Natalie Markham, a director of
Holdco and SPVs: 27,852 shares (0.02% of issued share
capital).
Lara Townsend, a director of
Holdco and SPVs: 18,266 shares (0.01% of issued share
capital).
c)
Amounts payable to related
parties
Amounts payable to the Investment
Adviser represent expense paid on behalf of the Company and
amounted to £264,724 at the Period end.
d)
Amounts receivable from related
parties
The Company has provided a loan to
Holdco for £125 million at 7% interest, of which £90.5 million has
been drawn to date (March 2023: £53.4 million), £22.9 million
(March 2023: £nil) has been repaid from cash generated or share
conversions, leaving £70.9 million outstanding as at 31 March 2024
(March 2023: £53.4 million). The Company has an intercompany loan
payable to Holdco of £9.2 million (March 2023: receivable
£546,624), which is held on a instant access deposit account and
the Company level.
The Company has provided a loan to
Rooftop Solar 2 Limited for £30.7 million at 8% interest (March
2023: £nil), which is fully drawn.
16
Unconsolidated Subsidiaries, Associates and Other
Entity
The following table shows
subsidiaries of the Company as at 31 March 2024. As the Company is
regarded as an investment entity as referred to in note 2, these
subsidiaries have not been consolidated in the preparation of the
financial statements. The Company is the ultimate parent
undertaking of these entities.
|
Ownership
|
|
Country of
|
|
Name
|
Interest
|
Investment Category
|
incorporation
|
Registered address
|
Atrato Onsite Energy Holdco
Ltd
|
100%
|
Holdco subsidiary
entity
|
UK
|
1 King William Street, London,
EC4N 7AF
|
Atrato Rooftop Solar 1
Ltd
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
EMDC Solar Ltd
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
Hylton Plantation Solar Farm
Ltd
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
London Road Energy
Centre
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
Rooftop Solar 2 Ltd
|
100%
|
Holding subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
Sonne Solar Ltd
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
Skeeby Solar Ltd
|
100%
|
Operating subsidiary entity, owned
by Holdco
|
UK
|
1 King William Street, London,
EC4N 7AF
|
HGPE ASG Finance
Limited
|
100%
|
Holding subsidiary entity, owned
by Rooftop Solar 2 Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
HGPE ASG Limited
|
100%
|
Holding subsidiary entity, owned
by HGPE ASG Finance Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
A Shade Greener (F2)
Limited
|
100%
|
Operating subsidiary entity, owned
by HGPE ASG Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
HGPE ASG AssetCo
Limited
|
100%
|
Operating subsidiary entity, owned
by HGPE ASG Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
HGPE Steel Limited
|
100%
|
Holding subsidiary entity, owned
by Rooftop Solar 2 Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
HGPE Steel Nominee
Limited
|
100%
|
Holding subsidiary entity, owned
by Rooftop Solar 2 Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
A Shade Greener (F8)
LLP
|
100%
|
Operating subsidiary entity, owned
by HGPE Steel Limited and HGPE Steel Nominee Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
Empower Community Solar
LLP
|
100%
|
Operating subsidiary entity, owned
by HGPE Steel Limited and HGPE Steel Nominee Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
HGPE ASG2 AssetCo LLP
|
100%
|
Operating subsidiary entity, owned
by HGPE Steel Limited and HGPE Steel Nominee Limited
|
UK
|
6th Floor Capital Tower, 91
Wateroo Road, Lndon, SE1 8RT
|
Guarantees provided by the Company
in relation to liabilities that may arise in Hylton Plantation
Solar Farm Ltd or Sonne Solar Ltd have been provided in the table
below. The expected economic or cash outflow from the Company is
expected to be nil.
Provider
|
Investment
|
Beneficiary
|
Nature
|
Purpose
|
Amount
£'000
|
The Company
|
Hylton
|
Nissan
|
Guarantee
|
PPA
|
10,000
|
The Company
|
Sonne
Solar
|
Tesco
|
Guarantee
|
Framework PPAs
|
10,000
|
The Company
|
Sonne
Solar
|
Tesco
|
Guarantee
|
PPA
|
6,000 to
10,000
|
The Company
|
Sonne -
LCY2
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne -
LTN4
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne -
EDI1
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne
-MAN2
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne
-BHX2
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne
-BHX3
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Sonne
-BHX4
|
Amazon
|
Guarantee
|
PPA
|
30,000
|
The Company
|
Skeeby
|
Ovo
Energy
|
Guarantee
|
PPA
|
2,500
|
17
Commitments and contingencies
As at 31 March 2024, the Company's
subsidiaries had future investment obligations totalling £5.0
million of future investment obligations in relation to the Skeeby
project in North Yorkshire. These amounts are capital commitments
within the portfolio to be funded by flows from the Company, at the
time of the final milestone payments, which are expected to be by
July 2024.
18
Post balance sheet events
On 17 April 2024, the Company
agreed to future investment obligations totalling £1.9 million in
relation to the installation of solar panels at 3 Tesco sites in
Sonne Solar Limited's investment portfolio located in Kings Lynn,
Stockport and Wisbech respectively.
On 23 April 2024, the Company
declared an interim dividend in respect of the period from 1
January 2024 to 31 March 2024 of 1.37 pence per Ordinary
Share, paid on 24 May 2024 to Shareholders on the register on 3 May
2024. On that record date, the number of Ordinary Shares in issue
was 150,000,000 and the total dividend paid to Shareholders
amounted to £2.1 million. The dividend has not been included
as a liability at 31 March 2024.
On 10 May 2024, the Company
completed on the acquisition of two operational solar projects for
£4.7 million. The assets have a total capacity of 7.3MW and benefit
from a corporate PPAs for 17 to 24 years.
On 3 June 2024, the Company
completed on the acquisition of a mixed operational portfolio for
£9.3 million. The assets have a total capacity of 13MW and include
ROC subsidised ground mount assets, and subsidy free ground mount
assets with a weighted average contract term of 10.4
years.
By the reporting date, the other
financial liabilities have been fully paid.
No other significant events have
occurred between 31 March 2024 and the date when the interim
accounts were authorised by the Board of Directors, which would
require adjustments to, or disclosure in, the Company's interim
accounts.
Alternative Performance Measures
In reporting financial information,
the Company presents alternative performance measures ("APMs")
which are not defined or specified under the requirements of IFRS.
The Company believes that these APMs, which are not considered to
be a substitute for or superior to IFRS measures, provide
stakeholders with additional helpful information on the performance
of the Company. The APMs presented in this report are shown
below:
Premium/Discount
The amount expressed as a
percentage, by which the share price at 31 March 2024, is greater
or less the NAV per share.
|
|
|
|
|
|
As at
31 March
|
As at
30
September
|
|
|
2024
|
2023
|
NAV per share (pence)
|
a
|
90.0
|
92.0
|
Share price (pence)
|
b
|
74.6
|
71.4
|
(Discount) / Premium
|
(b÷a)-1
|
(17.1%)
|
(22.9%)
|
Total return
Total return is a measure of
performance that includes both income and capital returns. It
considers capital gains and the assumed reinvestment of dividends
paid out by the Company into its shares on the ex-dividend date.
The total return is shown below, calculated on both a share price
and NAV basis.
|
|
|
|
|
31 March
2024
pence
|
31 March
2023
pence
|
30 September
2023
pence
|
Ordinary share price at period/year
end (a)
|
74.6
|
85.6
|
71.4
|
Dividend per ordinary share
declared/paid in respect of period/year (b)
|
2.63
|
2.52
|
5.0
|
Ordinary share price at beginning
of period/year (c)
|
71.4
|
99.5
|
99.5
|
Ordinary shareholder total return per share ((a + b - c) / c,
expressed as a percentage)
|
8.2%
|
(11.4%)
|
(23.2%)
|
|
31 March
2024
pence
|
31 March
2023
pence
|
30 September
2023
pence
|
NAV per ordinary share at
period/year end as per Statement of Financial Position
(a)
|
90.0
|
93.8
|
92.0
|
Dividend per ordinary share
declared in respect of period/year (b)
|
2.63
|
2.52
|
5.0
|
NAV per ordinary share at beginning
of period/year end as per Statement of Financial Position
(c)
|
92.0
|
92.8
|
92.8
|
NAV total return per ordinary share ((a + b - c) / c,
expressed as a percentage)
|
0.7%
|
3.8%
|
4.5%
|
Ongoing charges ratio
A measure, expressed as a percentage
of average NAV, of the regular, recurring annual costs of running
an investment company.
|
|
|
|
|
|
|
|
|
31 March
|
31 March
|
30
September
|
|
2024
|
2023
|
2023
|
Average NAV (£'000) (a)
|
136,555
|
139,888
|
138,591
|
Ongoing fees* (£'000)
(b)
|
2,526
|
2,277
|
2,459
|
Ongoing charges ratio
|
1.9%
|
1.6%
|
1.8%
|
*Ongoing fees for the six months to
31 March 2024 annualised. Consisting of investment management fees
and other recurring expenses.
Gross Asset Value
The total value of all the assets
of the Company, including the value of the debt held in the
subsidiaries (NAV £135.1 million plus £30 million RCF debt and
£45.7 million project debt).