NESF Nextenergy Solar Fund Limited

LEI: 213800ZPHCBDDSQH5447

15 May 2024

NextEnergy Solar Fund Limited

("NESF" or the "Company")

11th Dividend Target Increase

NextEnergy Solar Fund, a leading specialist investor in solar energy and energy storage, is pleased to announce the Board has approved a dividend target of 8.43p per ordinary share for the financial year ending 31 March 2025. 

In line with the Company's progressive dividend policy, the Board considers that a 1% increase in the dividend target appropriately balances the interests of the Company, investors and other stakeholders whilst taking into account the strength of the prior year's dividend and the Company's attractive c.11% dividend yield, which is currently one of the largest amongst renewable investment companies as at closing share price on 14 May 2024.

The target dividend cover is forecasted to be between 1.1x-1.3x, supported by a high degree of visibility of the Company's revenues. The Company's RPI-linked subsidised revenues represent approximately 50% of total revenues. The remaining revenues are derived from budgeted electricity generation, of which prices for 82% of revenues have already been fixed to 31 March 2025 through the Company's active power hedging strategy.

The Company has declared total ordinary dividends since inception of £345m or 67.8p per ordinary share. This announcement represents NextEnergy Solar Fund's eleventh consecutive dividend target increase, in line with the Company's progressive annual dividend policy. The Company has an impressive track record having achieved all its dividend targets whilst maintaining a covered dividend throughout the last ten years and continues to target a covered dividend beyond the current financial year.

In deciding the target dividend, the Board considers projected future power prices and associated price hedges, inflation in renewable markets, historic and budgeted technical, financial and operational performance of NESF's portfolio, and the ratio of cash cover to proposed dividend payments.

Helen Mahy, Chairman of NextEnergy Solar Fund, commented:

"We are proud to announce NextEnergy Solar Fund's eleventh consecutive year of dividend growth which evidences the strong position the Company finds itself in despite a challenging macroeconomic backdrop for the wider sector.  NextEnergy Solar Fund's dividend per ordinary share is one of the highest among the listed renewable energy investment company sector demonstrating its resilience, which offers investors an attractive dividend yield through access to a high-quality portfolio of solar energy and battery storage assets.  The Company continues to service its progressive dividend by securing future revenue flows, maintaining a robust operational asset base, and continually looking for attractive growth prospects.  We look forward to continuing to deliver on plans like the Capital Recycling Programme, which should leave NextEnergy Solar Fund in a stronger position than ever."

Notes:

The dividend target stated in this announcement is a target only and not a profit forecast. There can be no assurance that this target will be met, and it should not be taken as an indication of the Company's expected future results.  Potential investors should not place any reliance on this target and should decide for themselves whether or not the target dividend is achievable.

Notes to Editors¹:

About NextEnergy Solar Fund

NextEnergy Solar Fund is a specialist solar energy and energy storage investment company that is listed on the premium segment of the London Stock Exchange and is a FTSE 250 constituent.

NextEnergy Solar Fund's investment objective is to provide ordinary shareholders with attractive risk-adjusted returns, principally in the form of regular dividends, by investing in a diversified portfolio of utility-scale solar energy and energy storage infrastructure assets.  The majority of NESF's long-term cash flows are inflation-linked via UK government subsidies.

As at 31 March 2024, the Company had an unaudited gross asset value of £1,155m.  For further information please visit www.nextenergysolarfund.com

Article 9 Fund

NextEnergy Solar Fund is classified under Article 9 of the EU Sustainable Finance Disclosure Regulation and EU Taxonomy Regulation.  NextEnergy Solar Fund's sustainability-related disclosures in the financial services sector are in accordance with Regulation (EU) 2019/2088 and can be accessed on the ESG section of both the NextEnergy Solar Fund and NextEnergy Capital websites.

About NextEnergy Group

NextEnergy Solar Fund is managed by NextEnergy Capital, part of the NextEnergy Group.  NextEnergy Group was founded in 2007 to become a leading market participant in the international solar sector.  Since its inception, it has been active in the development, construction, and ownership of solar assets across multiple jurisdictions.  NextEnergy Group operates via its three business units: NextEnergy Capital (Investment Management), WiseEnergy (Operating Asset Management), and Starlight (Asset Development).

·     NextEnergy Capital: has over 17 years of specialist solar expertise having invested in over 400 individual solar plants across the world.  NextEnergy Capital currently manages four institutional funds with a total capacity in excess of 3GW+ and has assets under management of $4.3bn.  More information is available at www.nextenergycapital.com   

·    WiseEnergy®:  is a leading specialist operating asset manager in the solar sector.  Since its founding, WiseEnergy has provided solar asset management, monitoring and technical due diligence services to over 1,500 utility-scale solar power plants with an installed capacity in excess of 2.5GW.  More information is available at www.wise-energy.com

·   Starlight: has developed over 100 utility-scale projects internationally and continues to progress a large pipeline of c.10GW of both green and brownfield project developments across global geographies.  More information is available at www.starlight-energy.com

Notes:

^1: All financial data is unaudited at 31 March 2024, being the latest date in respect of which NextEnergy Solar Fund has published financial information