HICL Infrastructure (HICL) H2 2025 earnings summary

Executive summary

• Delivered resilient annual results with strong operational performance and cashflow growth, supporting continued dividend progression and long-term growth ambitions despite macro volatility.

• Strategic capital allocation included over £500m of disposals in 20 months, £244m divested in the year above carrying value, and expansion of the share buyback programme to £150m.

• Growth assets now represent 45% of portfolio value, delivering 11% EBITDA growth and offsetting modest PPP underperformance.

• Portfolio remains highly diversified, with 66% UK exposure and top 10 assets accounting for 51% of value.

• Dividend guidance reaffirmed at 8.35p for FY2026 and increased to 8.5p for FY2027.

Financial highlights

• NAV per share declined 3.2% to 153.1p, mainly due to higher discount rates; total NAV fell to £1.531 billion.

• Operating performance up 7.7% year-over-year; underlying portfolio return was 7.7% (down from 9.0%).

• Dividend cash cover at 1.56x (1.07x excluding profits on disposal), targeting 1.1x by year-end.

• Net debt reduced to £102.2m, with available liquidity of £441.8m.

• Ongoing charges ratio reduced to 1.1%, with a new fee basis lowering it further to 0.95%.

Outlook and guidance

• Dividend cover expected to be at least 1.1x in FY2026 and beyond, with new FY27 dividend guidance set at 8.50p.

• Over £450m growth CapEx planned to 2030, all self-funded, with a strong pipeline for reinvestment.

• At least £200m of further disposals targeted for FY26 to fund buybacks and new investments.

• Prospective 10% net return for new investors, with a share price yield over 7%.

• Positive long-term outlook for infrastructure investment, with global demand projected at $68tn by 2040.