GCP Asset Backed Income Fund Ltd. · LSE:GABI
GCP Asset Backed Income Fund — GCP Infrastructure Investments — Investor Day (January 2025)
64 slides from GCP Asset Backed Income Fund's investor day presentation, Jan 30, 2025
Slide 1: Capital Markets Day 30 January 2025
~~ GCP INFRASTRUCTURE ii ae INVESTMENTS LIMITED ~ Capital Markets Day 30% January 2025 & Authorised and regulated by the Financial Conduct Authority Gravi Ss Se z
Slide 2: Important Notice
IMPORTANT NOTICE Warning This presentation (the "Presentation") has been prepared by Gravis Capital Management Limited (the "Investment Adviser" or “Gravis") andis for information purposes only. This Presentation is not intended for distribution to, or use by, any person or entity in any jurisdictio
Slide 3: Agenda
AGENDA GCP Infrastructure Investments Ltd — Capital Markets Day, 30" January 2025 12:15 Welcome & Introduction Andrew Didham, Chairman — GCP Infrastructure 12:25 Update on GCP Infrastructure Investments Meat inuestrent Director - Gravis 12:55 Asset Case Study Bianca McMillan, Associate Director - Gr
Slide 4: Welcome & Introduction
WELCOME & INTRODUCTION Gravis
Slide 5: Andrew Didham
Andrew Didham Chairman of GCP Infrastructure Investments Limited + Senior executive director with extensive board level experience in the Rothschild Banking group. * Serves on the boards of IG Group Holdings ple and Shawbrook Group PLC as a non-executive director and audit committee chairman. + Exec
Slide 6: GCP Infrastructure Investments Limited
GCP INFRASTRUCTURE INVESTMENTS LIMITED Invests in UK infrastructure that benefits from public-sector backed cash flows, with a focus on debt. Initial Offering Net Asset Value Investments Constituent of Market Cap the FTSE 250 since July 2015 £685m £960m 22 July 2010 £913m Note(s): As at 30 September
Slide 7: GCP Infrastructure Investments Limited - Objectives
GCP INFRASTRUCTURE INVESTMENTS LIMITED - OBJECTIVES The Company primarily invests in UK infrastructure debt and/or similar assets to meet the following key objectives. £ Income Pays an attractive risk- adjusted income and has done for 14 years Diversification Diversified across a range of different
Slide 8: Disciplined Capital Allocation
DISCIPLINED CAPITAL ALLOCATION The Board is continuing to execute the capital allocation policy and has made progress during the year. Disposals and refinances Capital Reallocation Onshore wind Rooftop solar Reduce leverage Return of capital Supported living Anaerobic digestion Portfolio rebalancing
Slide 9: Update on GCP Infrastructure Investments Limited
UPDATE ON GCP INFRASTRUCTURE INVESTMENTS LIMITED Gravis
Slide 10: Presenters
PRESENTERS Philip Kent Director, CEO Phil joined Gravis in 2015 and serves as the CEO. Phil is actively involved in the management of Gravis' direct infrastructure and real asset investments, and has led investments across a range of energy, renewable and social infrastructure asset classes. Phil ha
Slide 11: An Active Calendar of GCP Shareholder Engagement
AN ACTIVE CALENDAR OF GCP SHAREHOLDER ENGAGEMENT © ahh i i 2"d Annual Capital 114 shareholder 38 prospect meetings & Markets Day meetings 7 external events 2 Asset 12 Gravis Quarterly site visits newsletters factsheets Note(s): Calendar year 2024 GCP INFRA 6 webinars hosted Oy) Perception study Best
Slide 12: Capital Allocation - Objectives
CAPITAL ALLOCATION — OBJECTIVES The Company has progressed against the objectives for the use of the disposal proceeds. Disposals on average around £ Demonstrate NAV NAV Debt reduced from Reduce leverage £104m to £57m! Share buybacks commenced, y Minimum £50m capital return 3.1m purchased FY25 to da
Slide 13: Capital Allocation - Disposals
CAPITAL ALLOCATION - DISPOSALS Progress has been made with capital recycling in a market that has been challenging for disposals. Blackcraig Wind Farm (April 2024) - £31 million - 8.1% Net IRR - 1.3x MOICt Rooftop Solar (October 2024) - £7 million - Realised at NAV Onshore Wind Disposal (January 202
Slide 14: Capital Allocation - Future Disposal Opportunities
CAPITAL ALLOCATION — FUTURE DISPOSAL OPPORTUNITIES Further pipeline of disposal opportunities, focusing on exiting supported living exposures and reducing merchant electricity price exposure. Assets Supported Living Portfolio of c. 80 properties to be refinanced Portfolio of c. 55 properties to be d
Slide 15: Onshore Wind Disposal
ONSHORE WIND DISPOSAL * On30 January 2025, the Company disposed of its interest in the Pates Hill and Milton Keynes Wind Farms. The Company originally invested in 2017, part of a wider portfolio of five assets with c. 7OMW total capacity. * The projects each had seven Vestas V80 2.0MW turbines, bene
Slide 16: Rooftop Solar Disposal
GCP INFRA ROOFTOP SOLAR DISPOSAL In October the Company disposed of its interest ina portfolio of domestic rooftop solar assets, with generating capacity of c. 8.3MW installed across rooftops with six UK housing associations. Original investment was made in 2018 as part of a wider c. 130MW portfolio
Slide 17: Disciplined Capital Management
DISCIPLINED CAPITAL MANAGEMENT Returns requirements for new investment has increased significantly in recent months. Any investment decisions must be weighed against the investment opportunity offered by buying back shares and the benefits of repaying the RCF. Company investment level thi £116.0m Du
Slide 18: Portfolio Overview
PORTFOLIO OVERVIEW Amature, diverse and operational portfolio of UK infrastructure projects that is well positioned to benefit from the macro trends of population dynamics, decarbonisation and energy security. Portfolio by sector Healthoare Supported Living Biomass (domestic) Agriculture / Resource
Slide 19: Portfolio Overview (cont.)
PORTFOLIO OVERVIEW (CONT.) A mature, diverse and operational portfolio of UK infrastructure projects that is well positioned to benefit from the macro trends of population dynamics, decarbonisation and energy security. Portfolio by income type (' Portfolio by annualised yield Concentration (top 20 -
Slide 20: Capital Allocation Policy - Resulting Indicative Portfolio
CAPITAL ALLOCATION POLICY — RESULTING INDICATIVE PORTFOLIO The Company has highlighted its intention to materially exit the Supported Living sector and reduce exposure to merchant electricity prices. Executing on this will have significant changes to the underlying portfolio characteristics. Indicat
Slide 21: Refinancing of revolving credit facilities
* The Company refinanced its revolving credit facilities (RCF) ahead of the facility’s expiry at the end of March 2024, reducing total commitments £150m from £190m. + Supportive group of four lenders; Lloyds Bank, Mizuho Bank, Allied Irish Bank, and Clydesdale Bank (trading as Virgin Money) continue
Slide 22: Initial investments
Initial investments Subordinated debt in PPP / PFI Early mover lending to solar, wind, biomass, anaerobic digestion and supported social housing GIB acquisition @ c. £150m of assets acquired as part of GIB purchase by Macquarie 7 pps dividend target established in May 2020 Return of IPO subscription
Slide 23: Gravis Lending History
GRAVIS LENDING HISTORY Gravis has a 14-year history of lending in the infrastructure and asset-backed sectors. Annualised loss ratio - @ . Maturity of 2-40yrs an, IRR of 10.1% on exit 0.41% for relevant assets* (Significantly lower than unsecured HY bonds [2.11%])** £2.8bn invested em Social Infrast
Slide 24: Gravis Team
GRAVIS TEAM Lead Fund Advisers Phil Kent. 0 Investment Bianca McMillan Robyn MacHugh Wy Portfolio Management Phil Kent. Finance Chloe Marlow Will Parry-Jon Paul White Roopali Parmar iernan Risk Legal & Operations Distribution/ Investor Relations & Marketing GCP INFRA 23
Slide 25: Systems and Controls
SYSTEMS AND CONTROLS GCP INFRA Oporto Hints. a on stec Gravis has developed proprietary systems for the management of the Company’s investments and pipeline Engaged and active portfolio management - reporting, site visits, lender's advisers Processes and control framework audited by Deloitte annuall
Slide 26: Responsible Investment: Impact
RESPONSIBLE INVESTMENT: IMPACT ree -1,649 “1,320 GWH (ieee £202.8m Hospital beds provided! Renewable energy exported by Investment in supported living 1 w/% 40 30% portfolio assets! projects since IPO Healthcare facilities in portfolio! 488,842 905 Equivalent homes powered by Social housing units in
Slide 27: Commonality of Historic Challenges
COMMONALITY OF HISTORIC CHALLENGES Technical risks and legislative interventions have accounted for the majority of the Company’s historic challenges. *enewaoee “oer | verter Wind (onshore) Wind (offshore) Biomass — — Hydro. Other PPP PFI Other Social Housing | Medium impact | | High impact GCP INFR
Slide 28: Peer Group Universe - A Diverse Landscape
PEER GROUP UNIVERSE — A DIVERSE LANDSCAPE GCP Infrastructure Investments provides exposure to a diversified portfolio which is differentiated from its peers, with a repositioning expected over time. Economic Infrastructure Environmental Infrastructure Social Infrastructure Infrastructure Debt Listed
Slide 29: Asset Case Study: Rooftop Solar
ASSET CASE STUDY: ROOFTOP SOLAR Gravis
Slide 30: Presenter
PRESENTER GCP INFRA Bianca McMillan Associate Director Bianca is an associate director at Gravis focused on the Net Zero strategy and supporting GCP Infrastructure Investments Ltd. She joined from ENGIE where she was part of the Acquisitions, Investment and Financial Advisory team focused on energy
Slide 31: Rooftop Solar Portfolio - Introduction
ROOFTOP SOLAR PORTFOLIO - INTRODUCTION + GCP Infrastructure Investments became the first significant backer of domestic rooftop solar projects in the UK through its loan to A Shade Greener (“ASG”). + Between 2011 and 2015, GCPIIL made a series of senior loans to fund a portfolio of c. 50,000 UK-base
Slide 32: Rooftop Solar Portfolio - Characteristics
ROOFTOP SOLAR PORTFOLIO - CHARACTERISTICS 2.5 & 2.0 g é 215 cs o a ° 2 10 & ° a 2 05 a v £ Cc SPR a eee tte eee (0.5) SV. SP gh GO GON 5h GP AD Dr HP cM OP CP A GP oP oD Br oh oP oP of Fe PP ee PP PAPA PAP PAP” PP PP” PP ™ Feed-in-Tariff - Generation Revenue OFeed-in-Tariff - Export Revenue Insuranc
Slide 33: Rooftop Solar Portfolio - UK Solar Capacity
ROOFTOP SOLAR PORTFOLIO - UK SOLAR CAPACITY 12,000 10,000 8,000 6,000 4,000 2,000 | ar | 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Installed Capacity (MW) Source(s): Digest of UK Energy Statistics (DUKES) produced by the Department for Energy Security & Net Zero (DESNZ); Published
Slide 34: Rooftop Solar Portfolio - Refinance
ROOFTOP SOLAR PORTFOLIO — REFINANCE Initial Investment Investment Date: October 2011 Seniority: Senior age . . Up to £15m Initial Commitment: (up to 1,500 domestic installations) Rate: 9.20% Repayment Date: Jan 2036 Refinancing Date: Apr 2016 Nov 2017 Seniority: Subordinated Subordinated Initial Com
Slide 35: Evero Energy
EVERO ENERGY Elliot Renton Gravis
Slide 36: Presenter
PRESENTER Elliot Renton Chief Financial Officer - Evero Energy Elliot is the CFO of Evero Energy, one of the leading waste-wood-to- Energy owners and operators in the UK. Prior to joining Evero in 2020, from 2017 Elliot was CFO of Vista Global - one of the world’s leading Private Aviation groups, wi
Slide 37: Evero: A Leader in the UK Waste-Wood-to-Energy Sector
Evero A Leader in the UK Waste- Wood-to-Energy Sector 30 January 2024
Slide 38: We exist to Restore Balance
eve ro We exist to Restore Balance openers © we vevevop fe) we own WE OPERATE e& $2;> of waste wood nal carbon removals 375,000 tonnes of waste processed p.a. E Delivering the UK's Green Transition with waste wood. Powers 126,000 . K homes p.a. We employ over 100 = se people UK-wide 2
Slide 39: What we do
What we do Strictly Confidential
Slide 40: Our waste wood assets
Our waste wood assets Lisahally Widnes Ince • 22 Mw • 18 Mw • 23 MW • Adjacent to HyNet cluster • Located near key port - fuel import flexibility • Located within HyNet cluster • Powering >44k homes annually • Powering >42k homes annually • Powering >38k homes annually • Locally sourced waste wood p
Slide 41: Our capital history
Our capital history Strictly Confidential
Slide 42: Evero and Gravis
Evero and Gravis We have enjoyed working with Gravis • 2013 - c. £20m of mezzanine debt to fund the construction of Lisahally; • 2014 - c. £25m of mezzanine debt to fund the construction of Widnes; • 2017 - Acquired the GIB's share of Widnes mezzanine debt; • 2021 - Combined the senior and Mezz into
Slide 43: Our journey and Transition to BECCS
Our journey and Transition to BECCS Strictly Confidential
Slide 44: BECCS Carbon Capture - HyNet
BECCS Carbon Capture - HyNet HyNet is one of the most advanced decarbonisation projects globally InBECCS and MBECCS are located within/adjacent to the HyNet cluster Engaged in shortlisting process having already passed technical deliverability assessment InBECCS is advantageously located at HyNet pi
Slide 45: Mature Carbon Capture Projects to Generate Further Negative Emissions Benefits
Mature Carbon Capture Projects to Generate Further Negative Emissions Benefits Strategic Location: Situated within HyNet, the UK’s leading CCUS industrial cluster. Advanced Technology: Employs MHI’s state-of-the-art Finalise, "KM CDR" equipment. …FEED, Consents and Planning Revenue Path: Cost-compet
Slide 46: Slide 46
Slide 47: Baroness Bowles of Berkhamsted
BARONESS BOWLES OF BERKHAMSTED Cost Disclosure
Slide 48: Presenter
PRESENTER Source: httns://creativecommons org/licenses/by/3.0/image converted to black & white GCP INFRA Baroness Bowles of Berkhamsted * European Patent Attorney * Member of the European Parliament * Chair of the Committee on Economic and Monetary Affairs * Short-listed for Governor of the Bank of
Slide 49: Private Credit Outlook
PRIVATE CREDIT OUTLOOK Gravis
Slide 50: Presenter
PRESENTER GCP INFRA Albane Poulin Head of Private Credit Albane oversees activities in private credit across existing funds GCP Infrastructure Investments and GCP Asset Backed Income, as well as leading new strategies in this asset class. Albane joins from abrdn where she was Head of European Privat
Slide 51: Why Infrastructure Is an Ideal Private Credit Exposure
WHY INFRASTRUCTURE IS AN IDEAL PRIVATE CREDIT EXPOSURE ey — of 7 * Resilient through * Early stage of rate- * Credit quality * Supportive economic cycle cutting cycle is improving Government policy * Growing confidence + Attractive income * Capital preservation * Growing demand for return sustainabl
Slide 52: Proven Track Record of Generating High Returns Since 2011
PROVEN TRACK RECORD OF GENERATING HIGH RETURNS SINCE 2011 Securing attractive risk-adjusted returns and illiquidity premia. 13.00% © Gravis loan ee . — Bloomberg Sterling BBB corporates Bloomberg Sterling High Yield . 11.00% Syr Gilt s 2 > > 9.00% A 3 £ > £ 7.00% 2 5 $ @ 5.00% ® e 5 3 3.00% oO 1.00%
Slide 53: Assessing a Private Credit Fund Manager
ASSESSING A PRIVATE CREDIT FUND MANAGER Criteria to consider when assessing a private credit fund manager Strong track-record across each step of the lending process Gravis KPIs Strong origination capabilities: highly proficient and experienced team with ahistory 21direct investment of successfully
Slide 54: The Path to Net Zero - Current Commitments and Targets
THE PATH TO NET ZERO — THE CURRENT COMMITMENTS AND TARGETS 2024 2030 2050 Paris aligned UK’s 6 carbon budget 68% reduction (vs. 1990) by 2030 2033 - 2037 Banger mae Net Zero 78% reduction by 2035 (Legally Binding) 58 GW renewable* 135 GW renewables** Electricity 15GW offshore, 16GW __ 5IGW offshore,
Slide 55: Decarbonisation Provides Opportunities to Finance New Projects
DECARBONISATION PROVIDES OPPORTUNITIES TO FINANCE NEW PROJECTS IN A SUPPORTIVE ENVIRONMENT Electricity demand to double by 2050 + Electrification of heat and transport + Hydrogen production * Digitalisation More renewables Electricity network needs upgrade & expansion More flexible generation & stor
Slide 56: Sample Opportunities within Broader Private Credit Space
SAMPLE OPPORTUNITIES WITHIN BROADER PRIVATE CREDIT SPACE sector [Country |Whywe like it Digitalisation Decentralisation | Deglobalisation No drilling risk, long-term offtake SJ SY VY Geothermal Netherlands agreement already in place Fixed and variable rent with SY SY Glasshouses Sweden grower/tenant
Slide 57: Close & Questions
CLOSE & QUESTIONS Gravis
Slide 58: Regular, Sustained, Long-Term Income
REGULAR, SUSTAINED, LONG-TERM INCOME GCP Infra has consistently paid a strong dividend to shareholders since its IPO, regardless of market conditions, with availability-based infrastructure not as sensitive to GDP or wider macro-environment. At current trading levels this represents a c.10% dividend
Slide 59: Attractive Valuation Levels
ATTRACTIVE VALUATION LEVELS GCP Infra continues to trade at a significant discount to prevailing NAV, representing an attractive entry point. Steadily performing portfolio benefitting from subsidy-backed cashflows and a significant element of inflation protection. GCPIIL Share Price / NAV - Since IP
Slide 60: What the Current Discount Implies...
WHAT THE CURRENT DISCOUNT IMPLIES... Highly unlikely cash flow or discount rate adjustments need to be made to reconcile the current discount to net asset value ed a Cumulative cash flow (fbn) iS ° Valuation (£bn) 0.955 0.669 (30%) 0%) Discount rate (%) 7.9% 14.9% 88% Cash flow is 4 ; adjustment 100
Slide 61: Why Now? Highlights and Tailwinds
WHY NOW? HIGHLIGHTS AND TAILWINDS As the headwinds of the past two years abate, and government policy support improves, GCP Infrastructure is well placed to benefit. 5 Attractive entry 33 % point \ A Discount to NAV! Rate cuts As the BoE begins a cycle of rate cuts, infrastructure is expected to ben
Slide 62: Continuing to progress the capital recycling strategy
Continuing to progress the capital recycling strategy in a market that has been challenging for disposals. Pipeline in excess of the stated ambitions of the Capital Allocation Policy will enable further reset of the portfolio. Portfolio continues to operate well, while diversification has served to
Slide 63: Contact Information
Gravis Capital Management Limited 24 Savile Row London WIS 2ES www.graviscapital.com CONTACT INFORMATION Philip Kent philip. kent@graviscapital.com 020 3405 8512 Cameron Gardner cameron.gardner@graviscapital.com 020 3405 8555 Max Gilbert max.gilbert@graviscapital.com 020 3405 8515 Craig Jenkins crai
Slide 64: Gravis
Gravis INVESTMENT IDEAS FOR THE LONG RUN
GCP Infrastructure Investments — Investor Day (January 2025) on 6ix