H1 2023 Results: Well-covered, attractive dividend growth
On 31 August 2023, BBGI* published its interim results to 30 June 2023. Highlights included:
+8.8% annualised total NAV return since IPO in 2011;
NAV per share -1.4% to 149.8p (Net Assets at 30 June: £1,057m); NAV total return +1.1%. Portfolio weighted average discount rate increased by 30bps to 7.2%, detracting 2.5% from NAV. Other NAV drivers included FX moves after hedging (-1.2%), slightly offset by updated inflation and deposit rate assumptions (+1.3%) and portfolio performance (+4.2%), including value enhancement (+0.8%).
Strong dividend cover of 1.68x (FY22: 2.03x) allowed dividend targets, previously increased at year end, to be reaffirmed: 7.93p for 2023; 8.40p for 2024 (both +6% YoY); and 8.57p for 2025 (+2% YoY).
Net debt position of £7.9m with £25.8m drawn from the £230m multi-currency credit facility. Drawings could be repaid by 31 December using excess cash generated, and priority is for disciplined use of capital in this regard. Fund level gearing moderate at 2.4%.
*denotes a corporate broking client of Winterflood Securities