International Public Partnerships rides high on ‘strong’ outlook for infrastructure

Infrastructure investment company International Public Partnerships has continued to boost its portfolio with four new investments and has argued that the market considers its share price “materially undervalued.”

The FTSE-250 firm hiked its dividend growth target by three per cent to 8.37p per share in the six months ended 30 June, and declared a fully cash-covered interim dividend of 4.18p per share.

INPP completed the acquisition of Moray East for £77m in February, which the company said would “increase its contribution to the UK’s transition to a net zero carbon economy”.

The company made a further three investments during the period, into Flinder University Health and Medical Research Buildings, Gold Coast Light Rail, taking its total investment in the half-year to £85m.

Existing investments include gas distribution firm Cadent, wastewater firm Tideway and transport company Angel Trains.

The outlook for infrastructure “remains strong”, and there “continues to be a significant need for infrastructure investment across the geographies in which the company invests,” INPP said.

Mike Gerrard, Chair of International Public Partnerships, said: “The Company’s solid performance in the period is a testament to the resilience of its diversified, low-risk portfolio and fundamentals of the investment case.

“The Company has a progressive dividend policy on which it has delivered every year since its IPO in 2006. Moreover, the strength of the portfolio is such that no further investments are needed to continue this policy for at least the next 20 years.

“The board continues to believe the share price at which the company is currently trading relative to the net asset value materially undervalues the company.”

He added: “Whilst the bar is high for new investment, we continue to originate compelling opportunities to further enhance long-term shareholder value, investing over £85m in new investments in the energy transmission, social and digital infrastructure sectors during the period.”

INPP also announced an intention to increase the frequency of its dividend payments, from semi-annually to quarterly, commencing in 2025.

It will also extend its existing share buyback programme, increasing the programme by up to £60m.