Including dividends received but re-invested elsewhere in the portfolio. As it will always be, it’s about timing and then time in.

Downing Renewables & Infrastructure Trust plc

Net Asset Value and Operational Update

The Board of Downing Renewables & Infrastructure Trust plc (the “Company” or “DORE“) is pleased to announce the Company’s unaudited Net Asset Value (“NAV“) as at 31 March 2024.

Net Asset Value as at 31 March 2024

The Company’s unaudited NAV was £212.3 million or 119.2 pence per share (“pps“) as at 31 March 2024. This is an increase of 1.3% from the Company’s NAV per share as at 31 December 2023 (£212.1 million or 117.7pps) following payment of the £2.4m (1.3pps) quarterly dividend.

The movement in NAV during the quarter was attributable to several factors:

–     Portfolio performance (+£3.2m, +1.8pps);

–     Update to the long-term power price forecasts (-£5.0m, -2.8pps);

–     FX movement (+£4.0m, +2.2pps);

–     Life extension project (+£3.2m, +1.8pps)

–     Share buybacks (-£1.9m, +0.4pps)

–     Dividend (-£2.4m, -1.3pps); and

–     Other movements (-£0.9m, -0.5pps).

As at 31 March 2024 the Company’s GAV was £351.0 million (31 December 2023: £352.2 million).

As announced on 22 May 2024, the dividend in respect of the period from 1 January 2024 to 31 March 2024 of 1.45pps has been declared and will be paid to shareholders on the register on 31 May 2024 on or around 28 June 2024. The target annual dividend for 2024 of 5.8pps represents a 7.85% increase from the 2023 dividend.

Triple Point Social Housing REIT plc

Rent Collection and Portfolio Sale Update

Further to the “Portfolio Sale and Lease Transfer” announcement made on 3 May 2024, the Board of Triple Point Social Housing REIT plc and Triple Point Investment Management LLP (“Triple Point” or the “Investment Manager“) today provide an update on rent collection, a potential portfolio sale and progress made with tenants, My Space and Parasol.

Increasing rent collection and strong rental growth continues

The Company’s portfolio delivered resilient performance in the first three months of the year to 31 March 2024. Rent collection increased to 93.3% (Dec 23: 90.2%), and 25 out of the Company’s 27 lessees continued to demonstrate no material rental arrears.

Increased rent collection has been complemented by continued rental growth. As at 30 April, 61.6% of the Group’s leases had put through their 2024 annual rent increase at a weighted average uplift of 6.1%.

Update on portfolio sale

The Company has agreed heads of terms in relation to a portfolio sale with an aggregate value in excess of £20 million. The portfolio sale is representative of the Company’s wider portfolio and contains a range of both new build and adapted properties as well as self-contained and shared homes. EPC ratings of the properties range from B to D. We expect the portfolio sale to complete prior to the publication of the Company’s interim results for the sixth month period to 30 June 2024, which will be published in September.

Update on Parasol and My Space

Parasol

The Investment Manager has commenced a process of transferring all of the Group’s properties currently leased to Parasol to Westmoreland, representing 9.6% of rent roll. The transfer process remains on track to complete before the reporting of the Company’s interim results in September.

Following completion of the lease transfer process, an update on forward looking rent collection will be provided and, in the interim, Parasol continues to pay rent in accordance with the existing creditor’s agreement.

My Space

The Investment Manager continues to engage with My Space’s senior management team on their turn-around plan. The Company notes that four new independent Board members have been put in place with housing, audit, compliance and procurement expertise and that rent collection is expected to increase over the course of the year. If an acceptable long-term position cannot be reached with My Space, which represents 8.1% of rent roll, then, as with Parasol, the Investment Manager will move leases to one or more alternative Registered Providers.

VPC is in a period of wind down. Its dividend on a “headline” basis is one of the strongest on offer at 16.84% per annum but is that good value for money? Is it “real” and sustainable? And should existing shareholders hold on, average down, or exit?

These have a repayment schedule which is shown below.

In the next 12 months over 40% of the loans will settle. The chart below is net of debt (£24m) plus about £45m of paydowns up to Q2 25. Obviously the 16.84% dividend will reduce but it’s likely to continue for another 4 periods at 2p a quarter – so an 8p a share return. After that (Q3 2025) it probably drops to 1p a quarter for another year and after Q3 2026 perhaps drops to 0.5p a quarter until the end of 2028.

If that’s the case then that’s 16p of dividends over 4 years. In 12 months time alone deducting 8p from today’s 48p buy price is equivalent to buying at a discount to NAV of 45.8%

Remember too the 73.82p estimated NAV is net of a 2p per share dividend in Q1 as well as a 4.26p capital return of B shares in April 2024. In other words we are on an 80.08p NAV as at 31/12/23 less distributions in 2024. Less a 1% YTD loss.

The Oak bloke

Expected dividends for the current portfolio. 2024 target 9k.

June £678.00

July £1,406

August £167

Forward 3 month fcast total £2,251

Cash for re-investment £415.00

All subject to change and some dividends could slip into the following month but of course that wouldn’t change the yearly total.

9k is the target for the end of 2027, although when u start to compound the difference in totals are not huge but many a mickle makes a muckle.

The emotional benefits of dividend re-investment. In fact, with this investment strategy you can actually welcome falling share prices.

The Motley Fool

Everyone’s talking about passive income. Here’s how investors could start making it today.

By Charlie Keough

A quick Google search of the phrase ‘passive income’ returns a staggering 151m results. But there’s one definition that stands out.

It comes from fabled investor Warren Buffett. He said: “If you don’t find a way to make money while you sleep, you will work until you die.” It’s a quote that’s stuck with me.

Making passive income has become incredibly important over the last few years with racing inflation eating away at pockets. As such, I can see why investors are keen to start making some extra cash alongside their main source of income.

If I were starting today, here’s how I’d go about it.

Buying stocks
There are plenty of ways to make additional income. But arguably the simplest is buying shares that pay a high dividend yield.
I could start a side hustle or try and enter the property game. But I’m targeting companies that share profits with shareholders via dividend payments.

What constitutes a high yield is subjective. For me, I tend to largely target companies that pay a yield over 5%. For context, the FTSE 100 average is 3.9%.

Finding the right businesses
Investors also need to do their due diligence. While some yields may look attractive, they may not be sustainable. We saw this most recently with Vodafone’s 11.4% payout, which is now being halved in 2025.

I target businesses that operate in mature industries with proven business models and stable cash flows. Given that dividends are never guaranteed, a strong track record of paying investors is also key.

Let time do its thing
It’s taken investors like Buffett decades to build the large passive income streams they receive today. And there’s a lesson in that. Building these streams doesn’t happen overnight.

It’s a long-term process. Take his investment in Coca-Cola. He bought the stock back in 1988 and added to his position over a couple of decades. Last year, he received a dividend cheque worth more than $736m from the company.

Coupled with adopting a long-term approach, I’d use compounding. By reinvesting my dividends, I can earn interest on my interest. Over time, that can super-boost my wealth.

An example
That’s all well and good, but I’m not going to leave here without giving an example that ticks the above boxes. That’s where Legal & General (LSE: LGEN) enters the frame.

It’s an insurance and asset management company and a stalwart in its field. There are a few more reasons why I hold the stock. Let me briefly explain.

Firstly, it has an 8.6% yield. That’s comfortably above the 5% benchmark I look for. Secondly, it has increased its payout by 80.8% over the last decade.

Of course, like all investments, there will be volatility. Right now, the business is facing headwinds as high interest rates impact deposit levels. But given its position as an industry leader, it’s stocks like Legal & General I’d target.
£15,000 invested in the stock today with an 8.6% yield will give me an investment pot of £196,144 after 30 years, assuming I reinvest my dividends. By year 30, this would pay me £16,108 a year, or £1,342 a month, in passive income

That’s a healthy amount of cash that would no doubt go a long way in allowing me to live a more comfortable retirement.

The post Everyone’s talking about passive income. Here’s how investors could start making it today appeared first on The Motley Fool UK.

Whatever I want to do with my free time, having a nice flow of passive income is likely going to help. It’s why I regularly invest in shares that pay me dividends.

Here’s how I’d build £1,000 a month in passive income starting from scratch.

Story by Ben McPoland

Getting started

Whether I’m beginning my investing journey with £10,000 or £100, I’d want to invest ina Stocks and Shares ISA. The reason is that they allow me to invest £20k a year without paying tax on any gains I make.

This is obviously a massive benefit to the wealth-building process, as well as saving me the hassle of working out my annual tax obligations to HMRC.

Specifically, it means I’ll get to keep all of the future passive income my ISA portfolio generates for me.

A company in great health

So, what type of stock would I buy once I’ve got my account up and running? Well, I’d focus on profitable companies that have strong competitive positions, pay generous dividends, and are trading cheaply.

One FTSE 100 stock that ticks all these boxes for me is Aviva (LSE: AV.). The  firm is a major player in the UK insurance market, offering a wide suite of products including car, home, travel, and life insurance.

In its recent Q1 results, the company reported that general insurance premiums increased 16% year on year to £2.7bn. Its workplace pensions business generated net flows of £2bn as it won 136 new schemes.

Attractive dividend and valuation

Turning to the stock, the valuation looks cheap. It’s trading on a forward price-to-earnings (P/E) multiple of 10.7, and a price-to-earnings growth (PEG) ratio of just 0.7.

The first is less than the FTSE 100 P/E average of 11, while the second is attractive because any PEG ratio under one suggests that the stock might be undervalued.

Now, I should point out that the share price is likely being weighed down by worries about a weak UK economy. Aviva could struggle to grow its profits if economic conditions remain challenging.

However, I think the risk is worth taking with the shares offering a juicy dividend yield of 7.2% for the current financial year. And while no payout is guaranteed, analysts do expect it to rise next year, giving the stock a forward yield of almost 8%.

£1k a month

Through a diverse portfolio of solid stocks like this, I reckon it’s possible to generate average long-term returns of 9%. That’s not guaranteed, mind you, and there will periods of underperformance.

But assuming I do, I’d turn £500 invested every month into £185,000 in just over 15 years. This would be with dividends reinvested.

At this future point though, I would be receiving £12,000 a year in dividends, assuming my portfolio was yielding just 6.5%. I could choose to take this as passive income or keep reinvesting to aim even higher.

The post Here’s how I’d build £1,000 a month in passive income starting from scratch appeared first on The Motley Fool UK.

The rules for the plan, there are only 2.

One. A portfolio of Investment Trusts that pay a dividend, to buy more Investment Trusts that pay a dividend.

Two. Any Trust that drastically changes its dividend policy must be sold, even at a loss.

Any trades posted to this blog are not recommendations to buy or sell as I’m not authorised to give advice but merely a diary record of any Trades.

The plan is to provide a ‘pension’ of between 14k and 16k on seed capital in a ten year period. The amount is not in doubt but the timescale, subject to markets, may slip. The current plans fcast for 2024 is to earn dividends of 8k with a target of 9k, the plan is currently ahead of both the fcast and the target.

Your own plan should be based on your own research and may will be different to mine depending on how many years u have in your accumulation stage, before u enter your de-accumulation stage. Hopefully, when u do enter de-accumulation u should be generating enough passive income to provide a ‘pension’ and some income for re-investment.

Our estimate of the number of investment companies trading at a 52-week high discounts over the past week is still relatively low, at 10. But does the appearance of three new names from the equity income and debt sectors signal tougher times lie ahead?

By Frank Buhagiar•04 Jun

We estimate 10 investment companies saw their discounts hit 12-month highs over the course of the week ended Friday 31 May 2024 – two more than the previous week’s eight.

New additions to the Discount Watch List include Diverse Income Trust (DIVI) from UK Equity Income, JPMorgan Global Growth and Income (JGGI) from Global Equity Income and Invesco Bond Income Plus (BIPS) from Debt. Now the discounts of JGGI and BIPS are, at less than -2%, both on the smaller side and what’s more did not prevent either fund from issuing equity over the course of the week. But throw DIVI into the mix and the question is, is the ever-lengthening timeframe for interest rate cuts to some point later in the year starting to have an adverse impact on discounts, particularly in interest rate sectors such as debt and equity income?

It’s a question we asked last week following the appearance of Finsbury Growth & Income (FGT) on the list. FGT’s discount has since narrowed, albeit slightly, but it remains close to year-highs. All eyes on next week then to see if any more equity income funds make an appearance.

The top-five discounters

FundDiscountSectorCeiba Investments (CBA)-68.99%

PropertyLife Science REIT (LABS)-57.73%Property

VPC Specialty Lending Investments (VSL)-43.92%Debt

JPEL Private Equity (JPEL)-40.67%Private

EquityOctopus Renewables Infrastructure (ORIT)-36.12%Renewables

The full list

Fund Discount Sector

Invesco Bond Income Plus (BIPS)-1.97%Debt

VPC Specialty Lending (VSL)-44.95%Debt

Develop North (DVNO)-1.44%Debt

Impax Environmental(IEM)-12.55%Environmental

JPMorgan Global Growth & Income (JGGI)-1.72%Global Equity Income

JPEL Private Equity (JPEL)-40.67%Private Equity

Life Science REIT (LABS)-58.73%PropertyCeiba Investments (CBA)-68.99%Property

Octopus Renewables Infrastructure (ORIT)-36.12%Renewables

Diverse Income Trust (DIVI)-10.03%UK Equity Income

Investment Trust Discounts – the Underlying Numbers

We estimate there to be 10 investment companies currently trading at year-high discounts to net assets, but if you take a closer look, a significant number are trading within 10% of their year-high discounts.

By
Frank Buhagiar
05 Jun

We estimate there to be 10 investment companies currently trading at year-high discounts to net assets. Compare that with the 35 plus we were reporting earlier in the year or the 55 plus seen in Q4 2023 when the narrative of higher for longer interest rates around the world took hold. With far fewer investment companies trading at a discount, it appears London’s investment company space is over the worst of its discount problem.

What’s more, two of the 10 trusts trading at year-high discounts over the course of the week ended Friday 31 May 2024, JPEL Private Equity and VPC Specialty Lending Investments, are currently in wind-down mode – share prices of companies realising assets can find themselves unloved, at least until the timing of when significant chunks of cash will be returned to shareholders becomes clear. The true number of 52-week high discounters arguably lower than the headline number suggests then.

Before hanging up the bunting, it’s worth taking a quick look behind the headline numbers. For the above sequence only tells part of the story – just those trusts trading at their highest (or lowest depending on one’s point of view) discounts to net assets for the year. What it doesn’t capture are those trusts that are trading at discounts close to their year-high levels. Not much difference, after all, between a trust trading at its widest discount of the year and one trading a handful of basis points off its high. A fuller health check of London’s investment company space is needed, one that takes into account those investment companies trading at or close to their 52-week high discounts. That way we can gain a clearer idea if London’s investment company sector is indeed over the worst of its discount problem.

A quick scan of London’s investment companies and the discounts at which they trade reveals the below list of companies trading within 10% of their year-high discounts:

Hansa Investment Company (HAN)

New Star (NSI)

Tetragon Financial Group (TFG)

Diverse Income Trust (DIVI)

UK Equity Income

Finsbury Growth & Income (FGT)

UK Equity Income

European Assets (EAT)

CC Japan Income & Growth (CCJI

JPMorgan Emerging Markets (JMG)

Syncona (SYNC)

Menhaden Resource Efficiency (MHN)

VPC Specialty Lending Investments (VSL)

Invesco Bond Income Plus (BIPS)

NB Distressed Debt (NBDD)

NB Distressed Debt Global Class (NBDG)

Digital 9 Infrastructure (DGI9)

Downing Renewables & Infrastructure (DORE)

Ecofin US Renewables & Infrastructure (RNEW)

NextEnergy Solar (NESF)

Asian Energy Impact (AEIT)

JPEL Private Equity (JPEL)

Schroder British Opportunities (SBO)

Schroder European Real Estate (SERE)

CEIBA Investments (CBA)

Property – Rest of the World

Develop North (DVNO)

Real Estate Credit Investments (RECI)

Third Point Investors (TPOU)

In total, 31 investment companies are trading within 10% of their year-high discounts. And among those listed, several are dealing with company-specific issues including, ongoing strategic reviews or realisation of their assets. Activity such as this generates a degree of uncertainty which in turn can lead to steep discounts. A further two investment companies, Invesco Bond Income Plus and Develop North, are trading on small year-high discounts that can hardly be counted as problematic at this point. In short, the investment trust sector’s discount problem, certainly not as painful as it has been in recent months.

And yet, the higher for longer interest rate narrative hasn’t gone away. If anything, as the months pass by, the narrative has got stronger. In the US, forecasts for the first rate cut are being pushed out to the end of the year/beginning of 2025. In the UK, with 2024 almost at the mid-point, the much-anticipated first cut has yet to happen despite many commentators predicting this would take place in Q1.

With increased uncertainty over the timing and pace of interest rate cuts, why then aren’t more investment companies trading at or close to year-high discounts? After all, interest rate sensitive sectors such as infrastructure, debt, renewables and equity income were regular features in our Discount Watch list when rates were being raised, and it was widely thought they would remain at elevated levels for some time.

So, the question is, will discounts play catch up and widen from here? Or will central banks come to the rescue by embarking on the long-awaited rate-cutting cycle?