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I’d buy 14,290 shares of this UK dividend stock for £100 a month in passive income
Our writer shines a light on a 6.2%-yielding stock from the FTSE 250 that he’s recently been buying to generate passive income.

Posted by Ben McPoland
Published 6 September

BBGI

When investing, your capital is at risk. The value of your investments can go down as well as up and you may get back less than you put in..

Investors looking to increase their passive income are truly blessed in the UK. That’s because there’s an abundance of options to choose from, both in the blue-chip FTSE 100 and mid-cap FTSE 250.

One of my favourites from the latter is BBGI Global Infrastructure (LSE: BBGI). Here’s why I recently bought a few more shares of this investment trust.

Stable income streams
BBGI specialises in social infrastructure projects through long-term public-private partnership and private finance initiative contracts. It has 56 portfolio assets, including motorways, bridges, hospitals, and schools.

Top 10 Investments Weighting

Golden Ears Bridge (Canada) 11%
Ohio River Bridges (US) 10%
A7 Motorway (Germany) 4%
Northern Territory Secure Facilities (Australia) 4%
A1/A6 Motorway (Netherlands) 4%
Victorian Correctional Facilities (Australia) 4%
Liverpool & Sefton Clinics (UK) 3%
M1 Westlink (UK) 3%
Women’s College Hospital (Canada) 3%
Poplar Affordable Housing & Recreation Centres (UK) 3%
Remaining investments 51%
These provide government-backed, inflation-linked income streams. Its partners are creditworthy public sector entities in countries with solid credit ratings (AA to AAA), such as Australia, Canada, Germany, the Netherlands, Norway, the UK, and US.

Geographical Split
Canada 35%
UK 33%
Continental Europe 13%
US 10%
Australia 9%
While I like this geographic diversification, these are locations where interest rates are high. And this has been a headwind for BBGI as infrastructure investments and valuations are sensitive to rate changes.

Also, higher rates reduce the attractiveness of its dividend yield relative to other investments. While I expect these challenges to ease as interest rates fall, they’re worth bearing in mind. Inflation could always return.

Covered dividend
At the end of June, there was no structural gearing at group level and no cash drawings on a revolving credit facility. The trust had net cash of £20.6m.

It reaffirmed its 6% dividend growth target for FY24, with a further 2% growth planned for FY25. And it expects its cash flow to be 1.3 to 1.4 times this year’s payout. So the dividend looks secure.

Over the medium term, we expect cashflows to continue to support a healthy dividend cover and provide ample headroom to sustain a progressive dividend policy well into the future.

Non-executive chair Sarah Whitney, H1 2024 earnings report
Earning passive income
At 136p, the current share price offers an attractive forward dividend yield of 6.2%.

This means a £19,434 investment in my ISA would get me around 14,290 shares, enough to pay the equivalent of £100 a month in tax-free passive income.

Moreover, the shares are trading at a 10% discount to net asset value. This compares to a five-year average premium of about 12%. I think this stock could be a steal for long-term investors like myself.

Please note that tax treatment depends on the individual circumstances of each client and may be subject to change in future. The content in this article is provided for information purposes only. It is not intended to be, neither does it constitute, any form of tax advice. Readers are responsible for carrying out their own due diligence and for obtaining professional advice before making any investment decisions.

Foolish takeaway
High levels of public debt combined with rising populations and the growing need for new infrastructure projects means specialist investors like BBGI are well-positioned to succeed.

De-globalisation is a megatrend that will require the onshoring of US manufacturing and an increased focus on energy security, driving significant demand for private infrastructure investments.

Meanwhile, the EU is aiming for Europe to become the first climate-neutral continent. The trust says this presents “a continuous flow of pipeline opportunities in the core infrastructure space“.

Finally, the Australian government is committed to investing A$120bn on projects over 10 years.

Even without further acquisitions though, management says the portfolio could continue to generate a rising dividend for the next 15 years.

While no payout is ever truly guaranteed, I’d be very surprised if this one was scrapped. I’d happily buy more shares with spare cash for a diversified portfolio.

Foberttop hpygenkaVeiSp@gmail.com 194.110.114.18

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No plans as yet. GL

SDCL Energy Efficiency Income Trust plc is a constituent of the FTSE 250 index. It was the first UK listed company of its kind to invest exclusively in the energy efficiency sector. Its projects are primarily located in North America, the UK and Europe and include, inter alia, a portfolio of cogeneration assets in Spain, a portfolio of commercial and industrial solar and storage projects in the United States, a regulated gas distribution network in Sweden and a district energy system providing essential and efficient utility services on one of the largest business parks in the United States.

The Company aims to deliver shareholders value through its investment in a diversified portfolio of energy efficiency projects which are driven by the opportunity to deliver lower cost, cleaner and more reliable energy solutions to end users of energy.

The Company is targeting an attractive total return for shareholders, with a stable dividend income, capital preservation and the opportunity for capital growth. The Company is targeting a dividend of 6.32p per share in respect of the financial year to 31 March 2025. SEEIT’s last published NAV was 90.5p per share as at 31 March 2024.

Something for the anoraks

SDCL Energy Efficiency update

SEIT, say it, sorted
SDCL Energy Efficiency update
The Oak Bloke

“The Oak Bloke from The Oak Bloke’s Substack” <theoakbloke@substack.com> 

Triple Point Energy Transition plc

(“TENT” or the “Company” and together with its subsidiaries, the “Group”)

SPECIAL DIVIDEND

The Board of Triple Point Energy Transition plc (ticker: TENT) announces that, as part of the managed wind-down approved by shareholders on 22 March 2024, and as a result of timely realisations to date and taking into account feedback received from shareholders, it has declared a distribution by way of a special dividend of c.£25m, equivalent to c.29% of the Company’s NAV as at 31 March 2024.

This is equivalent to 25 pence per ordinary share in the capital of the Company (“Ordinary Share”), payable on or around 4 October 2024 to holders of Ordinary Shares on the register on 20 September 2024. The ex-dividend date will be 19 September 2024.

SDCL Energy Efficiency Income Trust plc

(“SEEIT” or the “Company”)
Interim Dividend Declaration

SDCL Energy Efficiency Income Trust plc is pleased to announce the first quarterly interim dividend in respect of the year ending 31 March 2025 of 1.58 pence per Ordinary Share, covered by net operational cash received from investments.

The shares will go ex-dividend on 12 September 2024 and the dividend will be paid on 27 September 2024 to shareholders on the register as at the close of business on 13 September 2024.

££££££££££££

Now just waiting for SOHO to declare their next dividend.

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No problem with that. GL

Current dividends for this year to date £6,989.00

Current dividends xd £904.00

2024 Fcast of 8k means £107 to be received between October and December for the fcast to be achieved.

DIVIDEND DECLARATION

Supermarket Income REIT plc (LSE: SUPR), the real estate investment trust providing secure, inflation-linked, long income from grocery property, has today declared an interim dividend in respect of the period from 1 April 2024 to 30 June 2024 of 1.515 pence per ordinary share (the “Fourth Quarterly Dividend”).

The Fourth Quarterly Dividend will be paid on or around 16 August 2024 as a Property Income Distribution (“PID”) in respect of the Company’s tax-exempt property rental business to shareholders on the register as of 12 July 2024. The ex-dividend date will be 11 July 2024.

The Company has now declared four quarterly dividends totalling 6.06 pence per ordinary share in respect of the financial year ended 30 June 2024, in line with the Company’s full-year dividend target.

Next xd date October