NextEnergy Solar Fund (NESF) H2 2024 earnings summary

Executive summary

• Celebrated 10th anniversary with 103 operating assets producing over 1 GW, powering 301,000+ homes annually.

• Achieved 11 consecutive years of dividend growth, with £345m paid to shareholders.

• Expanded into Europe and energy storage, energizing the first standalone battery storage asset among peers.

• Advanced capital recycling, selling two assets for £42.2m, funding a share buyback and reducing gearing.

• Board and management remain focused on narrowing the share price discount to NAV through capital recycling and a £20 million share buyback program.

Financial highlights

• Portfolio valued at approximately £1.2 billion; Gross Asset Value at £1,155m (up from £1,122.5m year-over-year).

• NAV per ordinary share fell to 104.7p (from 114.3p year-over-year), mainly due to lower UK power price forecasts.

• Cash income of £80m; dividend cover at 1.3x.

• Dividend yield stands at 11%, among the highest in the FTSE 350; dividend target for FY24/25 set at 8.43p, a 1% increase year-over-year.

• Sold two assets (95 MW) post-period, raising over £42 million and impacting NAV by 1.84p.

Outlook and guidance

• Attractive market outlook with UK solar capacity expected to grow from 16 GW to 50–70 GW by 2035.

• Continued focus on capital recycling, disciplined capital allocation, and growth in solar PV and storage.

• Ongoing engagement with investors ahead of a discontinuation vote at the upcoming AGM.

• Pipeline of over £500m identified, with right of first offer on c.10GW Starlight pipeline.

• Share buyback programme of up to £20m underway.