Cordiant Digital Infrastructure Ltd (LSE:CORD) today announced a trading update marked by strong progress among its portfolio companies and an ongoing commitment to the London-listed group’s capital growth targets.
The investment company, which focuses on modern communications and internet infrastructure, reiterated its annual net asset value (NAV) return target of 9% per its 'Buy, Build and Grow' strategy, comprising capital growth and a progressive dividend.
Cordiant’s 4p dividend target for the financial year ending 31 March 2023 is 3.3x covered by EBITDA and 1.4x covered by free cash flow
Cordiant said it was “disappointed” to see company shares trading at a discount to net asset value (NAV). In response, the group announced a discretionary share buyback programme of up to £20mln.
In the nine months to 31 December 2022, aggregate portfolio company revenue increased 8.8% to £146mln, while EBITDA increased 5.9% to £76.5mln.
Operational highlights included:
- Polish broadcaster Emitel (which Cordiant acquired in November 2022) signing approximately £485mln in sales orders
- Portfolio company CRA's data centre capacity utilisation increasing by 21.7%
- Portfolio company Hudson InterXchange signing two marquee customers- a large US telecoms company and a US TV and satellite operator
Cordiant has £101mln of cash in the bank plus £133mln worth of potential liquidity in undrawn Eurobonds. Gross debt obligations of £441mln represent net gearing of 30%.
Co-founders and joint managing partners Steven Marshall and Benn Mikula commented: "In line with the strategy articulated at the time of the IPO, we have been disciplined in searching for high-quality, strongly cashflow-generating platforms at attractive prices during a period of time where we saw a lack of price discipline from private capital competitors.”
Chairman Shonaid Jemmett-Page said: "The board continues to be pleased with the progress made by the company in the two years since its IPO… The investment manager's strong, hands-on operational capabilities are being deployed effectively at the portfolio platforms."