3i Infrastructure PLC · LSE:3IN
3i Infrastructure — FY2021 Earnings Presentation
31 slides from 3i Infrastructure's earnings presentation, May 11, 2021
Slide 1: Results for the full year to 31 March 2021
Results for the full year to 31 March 2021 11 May 2021
Slide 2: Important information
Important information This disclaimer notice (and any non-contractual obligations arising out of or in connection w ith it) is governed by English law . The sole purpose of this information-only presentation (“Presentation”) and w ebcast on behalf of 3i Infrastructure plc is to provide information o
Slide 3: Important information (cont.) – US Persons
Important information (cont.) – US Persons The distribution of this Presentation in certain jurisdictions may be restricted by law . Persons into w hose possession this Presentation comes are required to inform themselves about and to observe any such restrictions. Terms used in this paragraph (incl
Slide 4: Consistently strong performance against our objectives
Consistently strong performance against our objectives Our strategy Our objectives To maintain a balanced portfolio of To provide shareholders with: infrastructure investments delivering an • A total return of 8% to 10% per attractive mix of income yield and capital annum, to be achieved over the ap
Slide 5: The Company continues to deliver long-term sustainable returns
The Company continues to deliver long-term sustainable returns 9.2% Total return on opening NAV Resilient portfolio consistently meeting or exceeding target return 268.1p NAV per share New investment, DNS:NET, in growth sector and new geography €182m New investment commitment 9.8p Delivered our FY21
Slide 6: Generating value in the current market
Generating value in the current market Asset intensive, resilient Return companies Mid Market Economic Asset bases that are hard to Infrastructure replicate Large Core Providing essential services Infrastructure Established market positions Operational PPPs Good visibility of future cash Our investm
Slide 7: Strong return from a diversified portfolio
Strong return from a diversified portfolio for the year to 31 March 2021 Total portfolio return 13.7% Infinis 14.7% Tampnet 8.3% Joulz 23.0% Ionisos 12.9% TCR 1.5% ESVAGT 13.5% Oystercatcher 14.3% Valorem 30.7% Attero 14.6% Projects 13.2% India Fund 18.5% 7
Slide 8: A well-diversified, balanced portfolio
A well-diversified, balanced portfolio Projects Portfolio value by sector Utilities Attero Infinis Communications 5% 5% 10% Valorem 5% 15% Transportation / 10% 37% 6% logistics Healthcare Natural Resources / 18% DNS:NET 8% Tampnet energy 12% 20% Social infrastructure 19 assets 8% £2.0bn Oystercatche
Slide 9: 3iN remains well positioned to deliver its objectives
3iN remains well positioned to deliver its objectives Continue to deliver for shareholders and broader community of stakeholders Help make our portfolio companies more sustainable Pipeline of potential bolt-on opportunities and new ideas 9
Slide 10: New investment: DNS:NET
New investment: DNS:NET Leading independent telecommunications provider in Germany • We committed €182 million to acquire a 60% stake alongside Founder and CEO • Germany (a new country for 3iN) lags behind most other European countries in the deployment of FTTH • DNS:NET is uniquely positioned to be
Slide 11: Infinis
Infinis Generator of electricity • Performed well through the Covid-19 crisis and its cashflow continues to support our yield • The baseload power price environment improved over the last six months and peak power prices were more volatile, benefitting Infinis • Good progress has been made on the ne
Slide 12: Tampnet
Tampnet Offshore telecom network • Core business in the North Sea was stable in the year with customers continuing to upgrade their bandwidth requirements • The oil price decline had a negative impact on exploration-linked revenues and brought forward some decommissioning of offshore platforms. In a
Slide 13: Joulz
Joulz Essential energy infrastructure equipment and services • Performed broadly in line with expectations during the year, and Covid-19 has had limited impact • The carve-out from Stedin is now completed • Continued progress on our strategy to broaden the product offering: in March 2020, acquired G
Slide 14: Ionisos
Ionisos Cold sterilisation for the healthcare industry • Outperformed expectations during the year, demonstrating resilience during the Covid-19 pandemic • Over the medium term, could benefit from increased testing, focus on sterilisation and relocation of pharma manufacturing to Europe • Italian op
Slide 15: TCR
TCR Ground support equipment in airports • Performed ahead of expectations in a severely hit aviation market thanks to its largely availability- based contracted revenue structure • Traffic is set to remain low in the near term, however the roll-out of vaccines continues to underpin our assumption o
Slide 16: ESVAGT
ESVAGT Wind farm maintenance support vessels and emergency response vessels • Performed in line with our post-Covid expectations during the year • Majority of earnings now generated by the wind segment, with one new vessels delivered in operations in January 2021 and two further expected later in th
Slide 17: Oystercatcher
Oystercatcher Oil product storage terminals • Benefitted from a contango market structure for oil products, which led to higher rates and early contract renewals • Negative impact of Covid-19 has been limited to lower throughput levels as a result of lower end- user demand • Continued good performan
Slide 18: Valorem
Valorem French renewable energy developer • Good year with revenues above budget and 45MW of wind, solar and hydro projects becoming operational • Since acquisition, the asset base grew by 2.7x to c.485MW of fully developed renewable capacity • All assets continued to operate as normal during the lo
Slide 19: Attero
Attero Waste treatment and processing • Resilient to the pandemic and performed broadly in line with our pre-Covid expectations • Waste production in the Netherlands and energy prices have recovered to pre-pandemic levels, however waste imports from the UK were weak over the period £88m • Plants wer
Slide 20: Appendix
3) Infrastructure plc Si Appendix
Slide 21: Share price has outperformed the market
Share price has outperformed the market 350 3iN 300 FTSE 250 250 3iN NAV 200 150 100 Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Mar 21 3iN TSR of 12.5% has outperformed FTSE 250 TSR of 7.6% since IPO Note: 1. FTSE 250 rebased to 3iN opening share price at 1 April 2016. 21 2. TSR stated is per annum sourced
Slide 22: FY22 target dividend growth of 6.6%
FY22 target dividend growth of 6.6% Dividend growth since IPO (pence per share) ▪ Special dividends ▪ Ordinary dividends ▪ FY22 dividend target 41.4 1 4.2% p.a. 10.2% 6.4% 6.5% 6.6% 17.0 7.00 7.25 7.55 7.85 8.65 9.20 9.80 10.45 5.00 5.30 5.50 5.72 5.94 6.49 6.70 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY
Slide 23: Portfolio summary
Portfolio summary 31 March 2021 (£m) Directors' Foreign Directors' Underlying Portfolio total Investment in Divestment in Accrued income Value Allocated foreign Portfolio assets valuation 31 exchange valuation 31 portfolio income return in the the year the year movement movement exchange hedging Mar
Slide 24: Strong liquidity
Strong liquidity (£m) (166) 105 658 (44) 553 Cash 463 Cash 358 Cash 253 Immediate DNS:NET & other Final dividend liquidity Deferred WIG investment proceeds commitments RCF 300 RCF 300 RCF 300 24
Slide 25: Income in line with expectations
Income in line with expectations (£m) 10 20 30 40 50 60 70 80 Economic infrastructure - interest European projects UK projects Economic infrastructure - dividends Non-income cash Non-portfolio interest Mar-21 Mar-20 25
Slide 26: Discount rate movement
Discount rate movement The weighted average discount rate is 10.8% Portfolio weighted average discount rate 10.8% 11.3% 10.8% 10.0% 10.5% Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 26
Slide 27: Sensitivities to total return
Sensitivities to total return Inflation linkage Assets with revenues: 11% Sensitivity +1% point -1% point Directly linked to inflation Change in inflation over £25m £(25)m underlying assumption for next 2 years Partly linked to inflation 89% 3% <1% Foreign exchange 7% GBP Sensitivity +5% -5% EUR/SGD
Slide 28: Hedging programme mitigates volatility
Hedging programme mitigates volatility (£m) FX loss before FX loss after hedging hedging (1) (1) ▪ Hedged assets (€/SGD/DKK/NOK) ▪ Unhedged assets (€/rupee) (23) (1) Note: SGD exposure is w ithin Oystercatcher, a euro denominated investment. 28
Slide 29: Introduction and Background
Introduction and Background Experienced and well resourced team established in 2006 Phil White Managing Partner Stephane David Schuster Bernardo Jim Stoner Thomas Fodor James Dawes Scott Moseley Aaron Church Anna Dellis Grand- John Cavill Nigel Middleton Matt Barker Tim Short Strategy Sottomayor Sen
Slide 30: Governance and fees
Governance and fees • Independent Chair, five independent non-executive directors and one 3i Group appointed non-executive director • Committed to observe requirements of the AIC Code of Corporate Governance Board of • Responsibilities include: Directors – overall supervision of 3i Investments plc a
Slide 31: 3i Infrastructure plc
3} Infrastructure plc