Sequoia Economic Infrastructure Income Fund Limited Ptg.Shs GBP · LSE:SEQI
Sequoia Economic Infrastructure Income Fund Limited Ptg.Shs GBP — Sequoia Economic Infrastructure Income Fund — FY2022 Earnings Presentation
27 slides from Sequoia Economic Infrastructure Income Fund Limited Ptg.Shs GBP's earnings presentation, Jul 11, 2022
Slide 1: Annual results FY22
Annual results FY22 July 2022
Slide 2: Overview of SEQI
Overview of SEQI The Sequoia Economic Infrastructure Income Fund (SEQI) offers a diversified portfolio of private loans backed by infrastructure projects • SEQI is a mature fund with a track record of over seven years. Since the IPO and through the end of March 2022, the total return has been approx
Slide 3: Financial highlights
Financial highlights 2
Slide 4: Goals for the year
Goals for the year Goal Commentary Achieved Gross portfolio return of 8-9% Portfolio yield to maturity of 8.4% Manage the portfolio responsibly 50% of the portfolio in floating rate assets through an inflationary and rising interest rate environment Fixed rate assets are relatively short-dated P
Slide 5: Financial highlights for the year
Financial highlights for the year Highlight March 2022 Change on year Comments Total net assets £1.78 billion Decrease of 2.3% Net asset value per share 100.50p Decrease of 2.6% After the payment of dividends of 6.25p per share Ongoing charges 0.87% Unchanged Calculated in accordance with AIC guidan
Slide 6: NAV bridge for the Financial Year
NAV bridge for the Financial Year Pence per share 5
Slide 7: Seven-year track record shows strong, steady performance
Seven-year track record shows strong, steady performance Growth in the size of the fund Relative performance Performance attribution (£ millions) (cumulative total return since the inception of the fund) (2) (pence per share) Capital Raising and Deployment Share price total return of 48% 50 +50.16 -
Slide 8: Portfolio and performance of the Company during the financial year
Portfolio and performance of the Company during the financial year 7
Slide 9: Portfolio characteristics at the end of the Financial Year
Portfolio characteristics at the end of the Financial Year (1) Portfolio characteristics Number of investments 76 Largest / avg. size(£mm) 64.7 / 24.1 Avg. maturity / avg. life (yrs.) 5.2 / 4.1 Portfolio modified duration 2.1 Average equity cushion 32% Construction risk 13% Defensive sectors (2) 47.
Slide 10: Portfolio generates a 8.4% gross return diversified across sectors
Portfolio generates a 8.4% gross return diversified across sectors 15 largest investments (1) Cash- Yield to Value % of Type (2) Transaction name Ranking Ccy Sector Sub-sector on-cash mat. / £mm (3) NAV yield (4) worst Private Bannister Senior Secured Senior GBP 64.7 3.6% Accommodation Health care 7
Slide 11: Managing the portfolio responsibly
Managing the portfolio responsibly Selective approach to new investments Current target investment dashboard • SEQI’s investment strategy is to add very selectively to the portfolio. The fund rejects about 90% of the opportunities it sees (1) • Pre-Covid, the fund was positioning itself cautiously o
Slide 12: Case studies of recent investments
Case studies of recent investments Exmar Exmar is a Euronext-listed ship owner and operator in the transportation of • NOK 650 million liquefied gas. Exmar has a strong focus on developing sustainable solutions in investment shipping and is at the forefront of developing ammonia-fuelled ships and CO
Slide 13: Credit quality performance over the year
Credit quality performance over the year Underperforming assets have halved Credit quality improvement over the year Clear strategy for loan resolutions 12 • Sectors that were adversely affected by 1. Australian potash (1.7% of gross asset value). Covid, such as student accommodation and This busine
Slide 14: Environmental, Social and Governance
Environmental, Social and Governance 13
Slide 15: ESG is integral to our investment framework
ESG is integral to our investment framework Incorporating the UN Principles for Responsible Investment in our investment processes and decisions ESG implementation Climate Change Pledge SEQI Climate Pledge 1. We support the Paris climate goals to limit the global average • Negative screening / exclu
Slide 16: ESG milestones and examples of scoring criteria
ESG milestones 2022 ESG milestones ESG scoring • All the identified “non-compliant” legacy • The Fund has developed a ESG scoring framework Alignment with community goals Examples of scoring criteria investments in the portfolio have which blends environmental, social and governance matured or been
Slide 17: Performance after year-end and outlook
Performance after year-end and outlook 16
Slide 18: Outlook and fund positioning
Outlook and fund positioning SEQI is well positioned to weather the current market challenges Rising interest rates Inflation We believe the portfolio is well positioned to manage this situation, and Moderate inflation is likely to be helpful for the credit quality of many of moreover see significan
Slide 19: Outlook and fund positioning (continued)
Outlook and fund positioning (continued) SEQI is well positioned to weather the current market challenges Recessionary risks Russia’s invasion of the Ukraine • The risk of recession is currently elevated, arising from increasing • SEQI is not permitted to invest in Russia, Belarus or Ukraine, and so
Slide 20: Outlook and fund positioning (continued)
Outlook and fund positioning (continued) SEQI is well positioned to weather the current market challenges Dividend cover Current share price • Given the higher interest rate environment, which feeds rapidly The Directors of SEQI and the Investment Adviser are focused on the though to portfolio incom
Slide 21: Appendix: The Board and the Investment Adviser
Appendix The Board and the Investment Adviser 20
Slide 22: Board and board advisor biographies
Board and board advisor biographies Sandra Jon Tim Sarika Robert Platts Bridel Drayson Patel Jennings Senior Ind. Non- Non- Non- Chair Director executive executive executive Director Director Director • Robert Jennings is a resident of • Sandra Platts is a resident of • Jon Bridel is a resident of •
Slide 23: Board and board advisor biographies (continued)
Board and board advisor biographies (continued) Independent consultants to the board Jan James Pethick Stewart Non- Non- Kate Andrea executive executive Thurman Finegan Director Director • Jan Pethick is a resident of the • James Stewart is a resident of United Kingdom and has over 35 the United Kin
Slide 24: Sequoia Investment Management Company (Simco)
Sequoia Investment Management Company (Simco) Simco profile (www.Seqimco.com) Simco value added Simco Partners Seasoned infrastructure, asset management and capital Randall Sandstrom Founded 2009 markets professionals CEO and CIO Superior infra debt origination and execution experience. Location Lon
Slide 25: Simco senior management biographies
Simco senior management biographies Randall Dolf Greg Steve Anurag Sandstrom Kohnhorst Taylor Cook Gupta CEO/CIO Co-Head Co-Head Head of CRO/COO Infra Infra PM • 27 years of experience in • 37 years of experience in • 30 years of infrastructure debt • 22 years of infrastructure debt • Over 20 years
Slide 26: Important information
Important information THE CONTENTS OF THIS DOCUMENT AND THE PRESENTATION ARE STRICTLY CONFIDENTIAL AND MAY NOT BE COPIED, DISTRIBUTED, PUBLISHED OR REPRODUCED IN WHOLE OR IN PART, OR DISCLOSED OR DISTRIBUTED BY RECIPIENTS TO ANY OTHER PERSON. ANY RECIPIENT OF THIS DOCUMENT AND THE PRESENTATION AGREE
Slide 27: Important information (continued)
Important information Continued THE COMPANY HAS NOT BEEN, AND HAS NO INTENTION TO BE, REGISTERED UNDER THE U.S. INVESTMENT COMPANY ACT OF 1940, AS AMENDED (THE "INVESTMENT COMPANY ACT") AND INVESTORS WILL NOT BE ENTITLED TO THE BENEFITS OF THAT ACT. THE SECURITIES DESCRIBED IN THIS DOCUMENT AND THE
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