Ecofin Global Utilities and Infrastructure Trust (LSE:EGL) — Investor Presentation

0:01 Good morning, and welcome to the ECOFIN GLOBAL UTILITIES AND INFRASTRUCTURE TRUST PLC investor presentation. Throughout the recorded meeting, investors will be in listen only mode. Questions can be submitted anytime by the q and a tab situated in the right hand corner of your screen. Just simply type in your question and press send. The company may not be in a position to answer every question received during the meeting itself. However, the company can review all questions submitted and published responses where it's appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Neil Wynwood of Prosper and Capital. Good morning. Good morning. Thank you, Paul. So, yes, Neil Wynwood here, also investor relations professional from Frostro Capital here with you for the webinar today on the investor meet company platform. And I have the pleasure of introducing the lead portfolio manager of ECOFIN GLOBAL UTILITIES AND INFRASTRUCTURE TRUST, Jean Hugues de la Mes. Jean Hugues been managing the trust for many years now with the fund in... Investing in essential listed utilities and infrastructure assets that's underpinned the new economy, enabling them to grow and giving you as an investor an attractive dividend yield and strong growth potential.

1:08 John Hook's going to provide an update for us covering off why we should consider investing in this strategy, why the Red Wheel team, and why today is the right time to consider this fund as an investment. I suspect the presentation will probably last about twenty five or thirty minutes, and there'll be plenty of time for q and a with the team before aiming to close by

1:31 11AM. So Jean Hoegh, over to you, please. Good morning. Good morning, Neil. Good morning, everyone. Thank you for attending ECOFIN GLOBAL UTILITIES AND INFRASTRUCTURE TRUST. As Neil said, the trust invests exclusively in listed utilities and infrastructure. It was launched in 2016, so ten years ago, under the ticker EGL LN. Let me introduce you to the trust. Well, first of all, the team here, the ECOFIN team, which joined Red Wheel a year and a half ago, pretty stable team of professionals and specialists of utilities and infrastructure globally.

2:26 Let me just briefly introduce you to the thematic of infrastructure and listed infrastructure specifically. I'm sure most of you are familiar with the characteristic of the asset class to be based on long term contracts with good inflation protection mechanisms. And overall, this is an asset class, which provides good immunity against short term economic cycles. So in the next few minutes, I will first of all give you a brief snapshot of our investment strategy at EGL. I will also describe the structural drivers of infrastructure worldwide. And then I will describe what we believe represents a specific opportunity to invest in the space of listed infrastructure today.

3:21 So moving on, first of all, to the snapshot of the strategy. This is the slide you have in front of you. It's a global strategy, as I mentioned, where we've decided to cap exposure to emerging markets at 10%. So it's typically an OECD type of strategy with a good balance between North America and Pan Europe in order to gain exposure to all geographies, all underlying themes, while balancing the risks. And we are aiming to identify companies which provide a combination of income and growth. So capital preservation and exposure to global growth. But when we speak about growth, we mean secular growth as opposed to cyclical.

4:12 So capital preservation, dividend income of around 4%, that's the average of the portfolio. It gives you a typical idea of the dividend yield you can get. And EGL detaches a quarterly dividend. But underlying growth is important to highlight. We estimate that the earnings and the dividends of the companies in our portfolio can grow by 5% to 7% per annum over the medium term. So the addition of those two, 4% dividend yield, dividends growing at around 6% per annum gives you 10% total return, which is very much our objective for every single company in the portfolio, but also for obviously the trust as a whole. And you'll see in the next slide that this is very much what we have delivered over the past decade, even actually a bit higher than that. I'll finish on that slide by describing the investment universe.

5:13 Electric and gas utilities, that's the most traditional part. And obviously, a component which consists of renewable energy, which is only one of the subcomponents, environmental services with water and waste management, and then transportation infrastructure with toll roads, airports. So that's a brief snapshot. Now a glance at the track record. This is the track record as of the close of the last fiscal year, which closed at the end of September twenty five. It's already looking reasonably old. But as you can see, we've delivered on the NAV annual return commitment, double digit. And interestingly, we have a Board which is very conscious of the need to provide regular increase in the dividends paid out on a quarterly basis to our shareholders, which have increased by 5% per annum over the past five years.

6:15 And the Board is committed to increasing the dividend by at least the rate of CPI. So that gives you an idea of the trend forward. More granularity on the performance track record, this is at the end of January twenty six, so it's more recent. As you can see, total return of the NAV per annum since inception ten years ago, 11.1 per annum. For the share price, so for our shareholders, it's even higher than that, 13.2% per annum, thanks notably to somewhat of a reduction in the discount. The trust is trading at a discount today, but the discount has reduced.

7:01 You may want to put those numbers in perspective of their investment universe. So if you look at the S and P Global Infrastructure Index, it seemed to increase by 7.2% per annum over the period. So we're delivering much higher returns than this. And our returns for EGL also compare well with the FTSE or share index for those of you who would use that index as a benchmark, which increased by 8%.

7:36 Main characteristic of the investment universe, and I briefly alluded to it upfront, asset backed services based on long term contracts. This is absolutely critical. And those long term contracts provide you with so good inflation protection mechanisms and predictable cash flows, which is really a key criteria when we select the names for our holdings in the portfolio. We want cash flows to be predictable in order to provide sustainable and growing dividends. So attractive returns, predictable returns on lower risk than average and volatility. Now I'm getting to the structural drivers of infrastructure, which I'm sure a lot of you would be familiar with.

8:31 We still live in a world with where infrastructure was built in the post World War II era, 1950s, 60s, 70s. So a large part of this infrastructure is getting obsolete And the aging phenomenon of infrastructure is becoming a real concern. If you look at the percentage of GDP invested in infrastructure over the past fifty years, it's only been declining. And it's hardly 2% today coming from something like 6% or even more forty years ago. So it's only been declining. And governments in general are very conscious of that risk and the need to invest in infrastructure to renew aging equipment.

9:19 This is why we've seen a few years ago, five years ago, The US voting the Inflation Reduction Act, largely questioned and dismantled by the current US administration. But more recently, '25, Germany voted the largest ever investment program in infrastructure of EUR 700,000,000,000 on top of a defense program. But €700,000,000,000 specifically for infrastructure investment consisting for almost half of it of investment in power grid, then on top of that investments in renewables and investments in transportation infrastructure. Those are three of the core sub segments of our investment universe, so very relevant to our investment strategy.

10:10 And the last chart I would comment on, on this slide, on the right hand side, is the example of Turner. Turner is an Italian power grid operator, and it's a purely regulated business, so very typical of the regulated utilities models that we have in our universe. And as you can see, the bars on that chart to the right represent the CapEx per annum and the gray line is the share price. So it's very simplistic, but as you can see, the more CapEx, the better it is for the companies in our universe, which diverges from a lot of sectors where CapEx has hardly been a source of incremental returns. In utilities in particular and infrastructure, the more CapEx, the better.

10:59 So that's about the structural driver. Now I'd like to describe what we consider to be a specific opportunity to invest in the space. And I'll insist on three particular underlying themes. The first one here is about accelerating demand for power. We are coming out of a period of twenty five years since 2000 of flat or declining consumption of electricity. In this country, The UK, we consume less electricity in volume terms than twenty five years ago, which is very counterintuitive if you consider that historically, consumption of electricity was following GDP trends.

11:46 Why is that? Why has it stagnated or even declined in The UK or in Continental Europe in particular, while only marginally increasing in The US because of efficiency gains generated over the past twenty five years, notably in terms of lighting, but in terms of every single electrical appliance. This is maturing. And experts would tell you that 2025 was the first year of recovery beginning of a recovery in consumption of electricity. And experts would expect significant increase in power demand in the next ten, fifteen years. We show on this chart estimates of a 38% increase in power demand in The U. S.

12:34 In the next fifteen years. And to the right, latest estimates for Europe and UK for a 50% increase in consumption of electricity in the next ten years by 2035, so pretty short term. What are the drivers of that? Electrification, clearly, our world is getting more electric, industrial processes, home uses in your kitchen, air conditioning at home, we are more and more dependent on electricity. Electric vehicles, definitely a driver, maybe not as stronger driver as expected five years ago, but it is coming. And obviously, the last and critical driver is demand from AI data centers, something you probably hear about in the press now every day.

13:29 This is about data centers and AI in general bound to account for about a third of the expected increase in electricity consumption in the next decade. So a critical matter. And for those companies which are well exposed to that trend, which are able to provide stable, carbon free electricity, particularly the nuclear operators. This is potentially a trend which is a source of massive rerating as we show at the bottom right of this slide, with two examples of traditional U. S. Utilities, Constellation and Vistra, which were somewhat on the other radars until a couple of years ago and have massively rerated because they are able to provide such electricity on a base load basis, I. E, 20 fourseven, which is exactly what data center companies do need.

14:28 So accelerating growth, accelerating demand for electricity is a significant driver of our investment universe and strategy. And it's fairly new and it's only the starting phase of a new era from our point of view. Now, the second factor, which is largely overlooked by generalist investors, is the significant de risking of the typical companies in our universe, notably of utilities. Fifteen years ago, a lot of you would be familiar with the fact that utilities were largely dependent on commodity prices. It was a volatile type of business, very merchant driven.

15:15 This has changed dramatically. If you take the sample, that's the bar chart at the top of this slide, sample of the 10 largest utility groups in UK, Europe. This proportion of merchant type of business has shrunk to 10% only of their operating profits. It was about fifty percent fifteen years ago, just under. And what has replaced that is a combination of regulated businesses and long term contracts. So I'm coming back to the point that I was mentioning upfront. This is a key factor for us and driver. Those long term contracts are typically the ones that data centers signed with utilities. When Amazon signed the first contract of that type in Pennsylvania in February 24, not very long ago, two years ago, it was the first contract of that type. It was signed for seventeen years with a close to renew it for an additional similar period.

16:13 So for those types of contracts, the utility that signs those not only gets typically very high prices because for companies like Amazon, the key is to secure the electricity supplies. But also, the utility gets an amazing level of predictability of its cash flows for that specific contract. They know specifically the annual price returns they're going to get for the initial seventeen year period of that contract. So from our perspective, the growing proportion of fully contracted businesses provides a massive de risking of the space, which is largely overlooked. And notably, if you look at the relative valuations, I'll come back in a minute of the space, you'll see that this is a universe which still trades on historic lows in relative fees, while it has massively derisked over the past ten, fifteen years.

17:12 And there is a last opportunity that we see. It's the underlying trends of earnings. Very much underpinned by the pricing environment, but not only. And you see actually on this chart an illustration of those long term contracts that I was just referring to PPAs, so power purchase agreements. Those are for wind and solar, to the left for The US, to the right for Europe. And as you can see in The U. S, prices keep on going up. They are now more than twice the average of the past twenty years, reaching something like around $70 per megawatt hour. They are plateauing in Europe, but on very high levels, actually slightly higher levels.

17:57 And that bodes well for bodes well for the returns. It's really an illustration of the scarcity of power generation capacity to face growing demand for electricity. That is a phenomenon which is, from our point of view, extremely favorable to the incumbents. And look at how it translates into earnings outlook and earnings revisions. The top left chart shows you how earnings expectations were revised for European and U. S. Utilities over the past twelve months by about 10 percentage points. So again, a couple of days ago, we had the result of one of the largest utilities in Europe, Italian utility, Enel.

18:45 And while the market pretty much had in mind that Enel would grow its earnings by about 3% per annum, well, management gave an indication that they think they are in a position to increase their earnings for at least the next three years by something like 6% per annum. So double the rate of earnings growth, which again is a phenomenon which has largely been overlooked, I believe, by the markets if you consider the valuations of the space, accelerating returns and earnings trends. Now you would typically expect those factors to translate into high valuations. Well, on these charts, you'll see that the relative piece, both in The U. S. And EU or UK and specifically for global infrastructure at the bottom left remain on historic lows.

19:43 From my perspective, this looks like a significant anomaly, which is only bound to be adjusted if you believe in the trends that I just described, combination of structural trends and more in shorter term opportunities that will be related to the quality of the earnings outlook. You may be pleased to see on the bottom right of this slide that EGL has a portfolio composed of actually cheaper than average names. And when I see that, the average of our portfolio in EGL is about 11.5 times EVEBITDA, I still believe that this is reasonably cheap with the Divinity deal, which is slightly above average that you can get in the global infrastructure universe or obviously in general equity markets.

20:38 And those who seem to have really taken or realized that opportunity are more the private equity investment specialists, much more than the listed equity, typically specialists that we are. Why is that? Because typically, I believe private equity gets a better sense of long duration business models. They have a longer term perspective when they go into an investment decision, while typically, Us listed equity investors would focus on the next two, three years. And probably, we tend to be much more influenced by interest rate trends. If I look at the past five years, obviously, you all know interest rates in The U. S, ten year treasury yields have moved from 1% to 5% in a straight line. They're coming back down.

21:31 But this has been a significant headwind for the relative performance of our space. While for private equity investors, I think they've gone beyond it. So if you look at it, the valuation premium that they've been paying for their take private transactions have only been going up. We've seen quite a few, but there was a significant one last year with Innergex taken private by Caisse de depot du Quebec for an 80% premium to the listed share price. And interestingly, the large infrastructure, private equity infrastructure specialists, you take Brookfield, KKR, Blackstone, Macquarie, BlackRock, GIP, have raised record amount of cash over the past twelve months, twelve, sixteen months, something like more than $150,000,000,000 for only those top five.

22:22 And this will have to be invested. And I believe the valuation gap between private equity transactions of infrastructure assets and listed valuations for equivalent assets is unprecedented and very much striking from our perspective. We've taken the example of airports at the bottom right of this slide, which if you take the last 10 transactions in private markets for airports, have averaged around, I mean, very close to 20 times EBITDA, just under, while the average of listed airports is below 10. So this is the type of anomaly which we believe at some point we'll need to adjust and which would present significant opportunity from our perspective.

23:09 So that's pretty much the investment case that I wanted to describe to you this morning. I'm showing here the top 10 holdings in EGL's portfolio. Hopefully, you would be familiar with most of those names, lots of large gaps, diversified in terms of geographies, diversified in terms of models of regulated versus non regulated. And in terms of sub segments, we invest in electric and gas utilities. We invest in water and waste management companies. We invest in transportation infrastructure names. And this is very much the type of diversification which we pay attention to in order again

23:51 to balance the risk and give exposure to all the underlying themes rather than only one. And in order to really spread the risk of local political regulatory intervention, which is always a pending risk when you invest in utilities and infrastructure. But as you have seen in the track record, which I described and showed you, we've managed to kind of avoid, not avoid, but I mean, navigate into in order to deliver the double digit total return per annum, which as I told you is very much our fundamental objective. So that's what we can say. Neil, very happy for you to take over now if we have questions.

24:43 That's the investment case and the opportunity that we see for ECOFIN Utilities and Infrastructure Trust today. Fantastic. Thank you very much indeed for your presentation. Ladies and gentlemen, do please continue to submit your Q and A just by using that tab on the top right hand corner of the screen. Just while the team take a moment to review those questions submitted today, I'd like to remind you that recording of the presentation, along with a copy of the slides and the Q and A can be published on the Investor Meet company platform. As can you see, we've had a number of questions throughout today's presentation. Thank you to all the investors for submitting those. So perhaps I'll start with the first one, if I may. It reads, where do you see technology disruption risk within utilities and infrastructure such as battery storage, deems... Decentralized generation, And how do you position for this?

25:31 Yes. Thank you. It is absolutely critical, your question, because this is a space which keeps on having to adapt to new technologies for the better. As you know, as I described, we only invest in the servicing part of the value chain, which means that we do not have direct exposure to technologies or industrial businesses such as batteries. What I would say is that batteries are definitely a critical matter for the years to come because this is the way that intermittent generation resources like wind and solar could, at some point, become permanent baseload producer of electricity. We're far from that.

26:16 Actually, the development of batteries have been a bit underwhelming. It's been much slower than expected. And today, batteries provide sort of a three to four hour backup to wind units typically. They are part of new new projects, which is largely insufficient to provide the the the stable twenty four seven electricity that I described and which typically most of the data center, who's notably, are looking for. So at this stage, we do not have many options to provide the carbon free stable electricity beyond nuclear. But obviously, if you ask me in ten years' time, it's most likely to have changed because you more or need to have much more efficient batteries, you will have new technologies.

27:06 The the the the ones which were worked on over the past few years have proved proved somewhat disappointing. You know, we... There were a lot of debates about green hydrogen in particular. This is not proving that economically efficient at this stage. So the world yet has to find the technology which would be both cost effective and would resolve the issue of intermittence of power supplies. So technology, definitely something to watch very closely. For us, we don't have direct exposure, but we are clearly paying a lot of attention to the evolutions on the battery front. Fantastic. Thank you very much indeed. Next question here is, in which areas are you seeing the most opportunities to invest? And how do you manage portfolio rotation and sell discipline?

27:59 Yes. So one key sub segment where we have really extended our exposure over the past twelve months is Grid. I referred to Grid, and you saw in the top 10 that actually National Grid is the largest holding in EGL today. And you see additional names, E. ON in Germany, Exelon in The U. S. We've paid a lot of attention to grid because we believe this is positioned in a very strategic manner at the center of the energy transition challenges. This is the area where you are potentially benefiting the most from the rise in volumes, notably of electricity consumption, without the power price risk.

28:53 And all of that within a preset regulatory framework, with governments and regulators here to incentivize investment in the grid, because this is an area where Europe and The US are showing significant weakness. You've all heard last year of the dramatic power outages that Spain suffered. And clearly, it was one main reason. It's the lack of transportation of electricity. You cannot store electricity, you need to transport it. But Spain is an island. There's only one interconnection line with France. And if France doesn't want or cannot provide the incremental capacity that Spain may need at a specific moment of peak consumption as we had last year, it leads to power outages.

29:48 So grid is very strategic, and we very much enhance the exposure of our portfolio to grid. The other sub segment I would mention clearly is nuclear. That's something which I believe was missed by a lot of investors until at least two years ago with the impression that nuclear was a technology of the past. Well, today, I believe nuclear has made a dramatic comeback because as I mentioned, it's the sole technology that provides carbon free baseload electricity. So this is these are two positions which we've really enhanced in our portfolio. And I mentioned the third one, which is regulated utilities. We were very selective during the period of steepening yield curves that we've seen between 'twenty one and 'twenty four in particular.

30:38 Very selective in only identifying regulated models with pure inflation pass throughs, which typically you have in The UK, but not everywhere. You did not have them in Spain, for example. Today, we may be ensuring a phase of

30:53 more lenient interest rates context, which pushes us to highlight a bit more the positions in regulated utilities compared to the past five years. Fantastic. Thank you very much indeed. Ashley, thank you very much indeed for your question. And why should an investor invest in your fund rather than other funds, which invest directly in infrastructure and actual renewable projects?

31:20 I'm convinced that I'm not criticizing private equity investors and infrastructure, of course, those are very high quality assets. But you've seen in the chart and hopefully in my message passed over the past half hour, that I believe the undervaluation of listed assets and infrastructure is striking and unprecedented. So you do have a specific opportunity to invest in listed infrastructure. I don't think you have many vehicles in the UK Investment Trust world, which allow you to do that. And in our case, with the trust trading at a also discount to its own NAV, you're kind of benefiting from a double discount, Discount to assets, which I believe are undervalued by investors, listed investors, and the discount to NAV, which I hope will close.

32:09 The trust was trading at a premium to NAV until mid-twenty twenty three. And again, this is a trend which we're trying to reverse, notably by buying back shares. That's a policy which the Board of EGL has very much insisted on. And we've been doing that quite systematically over the past two years. So investing in EGL today allows you to gain access to the double undervaluation of those assets of infrastructure, high quality assets, very sound fundamental outlook, key structural drivers and assets which are largely undervalued compared to private transactions. Thank you very much indeed. Question from David here, just on hydrogen. Do you consider investing in companies in the hydrogen power sector? Do you consider hydrogen to be an energy fad or maybe too early to invest in at the moment?

33:02 So too early for sure, or too late because we've realized that it's extremely difficult to make it an economically viable technology as I as I briefly mentioned earlier. And then the last point is, to be honest, there's hardly any opportunity to invest in in in green hydrogen in the listed utilities world. So the clear answer is that today, it's negligible. And we don't see real opportunity to invest

33:32 in this in the foreseeable future. You very much. Question from James. Thank you, James. How does EGL use gearing? Has and has this often benefits to shareholders? Yes. Thank you. So we have by by status the facility to have gearing up to 25% of that. In average over the past decade, it's averaged around 10, 10% plus. So we use gearing at our own discretion, the investment manager, and very much on an opportunistic basis. So it's a way for us to enhance our conviction and to benefit from market events.

34:21 Let me give you an example. In October 2016, like in October 2024, as we are all familiar with, the dramatic changes to the political changes in The US, change of US administration represented massive turbulences for the space of long duration business models with President Trump every time he's elected pushing for economic growth rather than favoring typically defensive sectors like infrastructure and also questioning, you know, the need for renewables and the reality of climate change, let's face it.

35:02 Those types of turbidences of the market typically give us the opportunity to buy the stock that we consider high quality on the cheap. And this is the typical type of opportunities where we use gearing. And interestingly, it's a bit the anecdote, but I find it interesting. 2016, obviously, massive shock with the election of of of Trump. In 2017, the year after, was one of our best years of performance for EGL. And the same happened for 2024 and 2025. So turbulences at the end of 2024, then 2025 proved actually our best year ever, I believe, in terms of returns generated for EGL shareholders. So this is the type of market events opportunities where we use gearing in order to enhance our degree of conviction on the high quality names in our portfolio. So opportunistic approach to it, reasonably levered, obviously, you know, 10%, 15% gearing.

36:05 And this is based on short term borrowings. So it's extremely flexible from my perspective. There is no structural gearing in EGL. Fantastic. A question from Raul. What are your investment plans for the African and Asian Pacific market? And in which particular asset types are you looking?

36:27 So we do not invest in Africa. This is not an area that ECOFIN has ever looked at, too risky from our perspective. Asia is obviously an area which we are paying a lot of attention to, notably to go back to your point on technologies. Know, quite often, there's a... The technologies may come from side or from The US as well. So Asia is important. But Asia today, overall, for us today, consists only of exposure to China, which was not always the case. At some point, we did own some positions in in Thailand and The Philippines. Today, it's it's exclusively in in China, which has been a difficult market for us over the past three, four years in particular, notably because of flows.

37:22 You will most of you will be familiar with the fact that the Hong Kong market, international markets of China, has been very difficult, notably because of outflows. And at some point, a couple of years ago, we noticed that some companies could be listed on the domestic market and on the Hong Kong international market of China with very different valuation terms. So a difficult market where we have today an exposure through three names and actually three sub sectors in order to diversify the risk. We have exposure to the wind developer, to a solar developer and to water management company in China. So we are very selective. This is part of our emerging market basket, which I told you we've decided to cap at 10%.

38:10 So at any point of time, those markets will represent a pretty limited part of our exposure to our portfolio. We very much rather concentrate on our exposure to North America, UK, Europe, with exposure to Asia being limited in a number of names and overall percentage weights within the NAV.

38:37 Thank you. And just an extension on that from David, I think you've covered this off. But do you look at companies in Australia with the possible increase in power supplies in the mining sector? If there's anything just to add to your previous response. We do look at Australia. It's actually a country I visited twice last year. Fascinated fascinating universe in itself. Lots of companies in universe and a real tradition for specialists of infrastructure, both on the corporate side and on the investment community side. Definitely an important market for us.

39:21 As of today, our exposure to Australia, though, is fairly limited to actually a toll road operator. And it's proved quite challenging because this is a toll road operator, which actually owns assets beyond Australia, notably in Europe. And we have found it difficult to see the proper valuation of those European assets from the Australian market perspective. So but this is definitely a market of interest to us. Obviously, a developed market, but more specifically, a market where we see a lot of expertise in infrastructure. And as the question hints, some potential opportunity, particularly in the world of electricity. But Australia is also a market where we've seen the bulk of the take private transactions in the past five years.

40:14 I think you've had at least five of the listed infrastructure names, which were taken private in 2021, 2022. So over the past five years in Australia, so the investment universe has shrunk. But yes, a straight answer to the question is yes, we're paying a lot of attention to this market. Thank you very much. James, thank you. How actively do you switch allocations between regions or individual markets? What actually triggers these moves? We don't rotate that much between regions. As I mentioned upfront, one key aspect of our risk approach and risk policy in the the EGL's investment strategy is to to to to balance exposure between geographies.

41:11 So we're keeping sort of a reasonably stable balance between North America and Pan Europe, both accounting more or less for similar weights in the portfolio. Having said that, we allow ourselves to be opportunistic when you see when we see good reasons for that. And the past eighteen months have been one of the most striking illustration of that ability to stay nimble in our geographical allocation. Up until the end of twenty four, I'd say up until October, November 24, The US, North American assets in our portfolio had reached record levels. One, because we were identifying the best growth opportunities for the bulk of 2024 in The US, with actually notably the main driver which appeared in early twenty twenty four, as I said, coming from data centers. This was purely a US phenomenon. It remains actually mostly US phenomenon. It hasn't really materialized in UK, Europe.

42:20 So in '24, we enhanced our exposure to The US to a much higher degree than usual, and we're quite underway to Europe. And with the Trump election coming in the last quarter of twenty twenty four, we dramatically rebalanced it. So dramatically trimmed positions and exposure to The U. S. To reallocate this capital to Europe, where we were seeing the cheapest valuations. There's almost 10 points gap in terms of PEs between U. S. Utilities and European utilities. So we were finding very attractive investment opportunities in Europe, notably among integrated utilities at the end of 'twenty four, early twenty twenty five. And this has paid off well because if you look at 2025, particularly for the first three quarters of it, this is a year last year, which was largely driven by European positions.

43:15 We've seen rerating of European names. I alluded to to Enel earlier, but we... We're seeing some names, you know, the BSSE in the in the

43:25 which have started to perform really well or E. ON in Germany over the past twelve months have been really laggards over the previous two years to the benefit of The U. S. So we allow ourselves to be nimble. So it's a long answer. But we typically want a good balance of risk, but we allow ourselves to be nimble. Same for the sub segments, which are not predetermined by a top down approach, but purely the result of our bottom up work and analysis. Now the one probably which is the most top down driven would be exposure to regulated names, as I mentioned, because they are typically more bond proxy types of stocks than the rest of the portfolio. And therefore, those ones you need to be quite selective depending on interest rate scenarios.

44:12 So we tend to be more confident on those ones than we've been over the past five years. Super. Thank you. Following from Ashley. Are you inhibited in any way by the trust size? Given the market opportunity and there are opportunities for you to expand, merge or acquire other funds, what are the total assets currently managed in this space?

44:34 So I'm going to answer with the investment manager's perspective, not... I mean, part of the question is for the board, the strategic developments potentially. From our perspective, Redwood ECOFIN G, we see the space as largely liquid, and therefore, it is a largely scalable strategy. We could easily run much more assets in the world of listed infrastructure. I did not mention it, but we're talking about something like $6,000,000,000,000 investment universe as we've identified globally in listed infrastructure. It's a very large universe. You've seen in our top 10 that we're talking about large gaps. So this TRUST EGL, your TRUST, could easily grow and we would not face any issue of liquidity of our investment space.

45:30 The best way to grow the size is I mean, are two ways, performance, but maybe more importantly related to your question, the ability to raise equity, to issue new equity, which we managed to do during 2020 to mid-twenty twenty three when the trust was trading at a premium. The discount is currently around 6%.

45:57 And again, we hope that performance and buybacks will convince investors that this is a trust which is worth trading at a premium, which would give us the opportunity to grow it with enhancing effects on the returns for our existing shareholders. So that's really my answer as investment manager. The rest of the question about potential strategic developments, that's more for the Board. I'm not in a position to answer, I'm afraid. Thank you. A couple of questions from Mark. I'm going to combine them, if that's okay. If AI becomes more efficient, what will the impact be on the sector? And also just touching on that, if data centers are overbuilt, how will this affect returns on utilities?

46:44 Thank you for the question. I'm getting that question. What I would say is that, of course, it's not going to be a development in a straight line. Last year, there were concerns about new possible technology coming from China, which would typically allow the construction of much more energy efficient data centers. We used to do those types of contradicting trends, if you'd like. The structural trend is that we are using more and more, I. We are going to need more data centers. On our iPhones, we all obviously use much more than a year ago, and that will continue this way. So the management of data is part of our society and economy. So I don't think this is bound to stop. Now, construction of the data centers, yeah, in some states in The US, you have some governors starting to say, let's slow it down a bit. Let's see how it works. So probably, yeah, I'm not again, I'm not saying it's going to be a straight line. I think the structural trend of AI, structural trend of rising demand for electricity is here and will last.

47:58 We've already seen some projects, very interesting projects, you know, by Microsoft or, again, Amazon, which are planning to build their own power generation capacity, which would be off grid. So for their exclusive use, actually, some of them are talking about nuclear bills, which is somewhat puzzling from a UK or European perspective, but that's potentially going to be in the heads of private corporates. So you're going to have such types of new developments and new technologies for sure. What I would say is that, this is EGL is a trust which was launched ten years ago. We've seen many different themes. We've seen many different events, interest rates, political, geopolitical, now data centers, which is very much a new theme.

48:57 I believe this is a structural trend at least for the next decade. But be assured that this is not a one theme strategy. Diversification is the key. We're looking to identify companies which provide double digit total return per annum with lower volatility than the market. This is our motto. And we're going to be opportunities in the themes we're playing. It's not a single theme strategy at

49:25 Thank you. And just a question here again from Ashley. The U. S. Equity market in a number of measures is more expensive than it's ever been. The relative valuation discount highlighted may therefore be a red herring. Similarly, the de rating of your sector has in part been driven by higher interest rates, which will remain in a higher for longer scenario. Given this, what's your estimated IRR of the portfolio? And what, for example, is your target price on national good? I appreciate you can't perhaps can't give forecast, but thank you, sir. I'm tempted to answer, but as you highlighted, Neil, I've been covering the space for many, many years. And I don't recall a situation where I've seen such an alignment between structural drivers, shorter term opportunities, very solid earnings growth for the individual companies and earnings growth being revised up with relative valuations on the load.

50:33 It's, from my perspective, a unique and compelling opportunity. So when I see that over the past decade, we've generated, as you see, you know, double digit total return per annum in very difficult market conditions in some years. My degree of confidence is pretty much as high as ever that we are in a position to continue to deliver this type of double digit total return per annum with our investment strategy, with the names that we invest in, through a combination of dividends and structural growth. So that's what I would answer to you.

51:16 It's reasonably conservative, but my degree of conviction here is pretty high. Fantastic. That covers off those questions. And thank you for taking those. And of course, any further questions do come through, we'll be able to publish a response on the Investor Meet company platform. Just before redirecting investors to provide you with their feedback, and it's particularly important to you and the team. Can I just ask you for a few closing comments, please?

51:44 Yes, what I would say, you know, to wrap this up is that you're talking about a very specific asset class. And our investment strategy at EGL is driven by an experienced team of specialists. We are all passionate about the space. I believe the track record tells you that we know it works. Now when I look at the future, and I'm going to repeat myself, but I believe we have a very strong structural trends, which are critical to our approach, which bode well bode well for an investment strategy, which will allow you to remain pretty humanized from long term economic cycles or from the big trendy theme of the moment.

52:36 We're not trying to be trendy. We're trying to focus on our business model investment strategy to identify double digit total return providers in the names we add to the portfolio. So from my perspective, EGL remains a very solid investment proposition as a diversifier in a generalist portfolio. Fantastic. Thank you very much indeed for updating investors today. Can I please ask investors not to close this session? Should now automatically be redirected to provide your feedback in order the team can better understand your views and expectations. So only take a few moments to complete, and it's greatly valued by the company. On behalf of the team of ECOFIN GLOBAL UTILITIES AND INFRASTRUCTURE TRUST PLC, we'd like to thank you for attending today's presentation. That concludes today's session, and good morning to you all.