Cordiant Digital Infrastructure Ltd (LSE:CORD)’s latest results were roundly praised by Kepler Trust Intelligence analysts, who highlighted Cordiant’s net asset value growth of 5.4% and a share price return of 38.9%, supported by operational improvements and disciplined portfolio management.
Kepler stated: “In our opinion, these results represent another solid step forward for Cordiant Digital Infrastructure.
“Not only has the underlying portfolio continued to develop, in line with the managers’ ‘buy, build, grow’ approach, but the trust’s liquidity profile has been significantly improved through the refinancing of the debt facilities, which has removed the near-term refinancing risk with nothing due until 2029, as well as increasing the managers’ liquidity sources and providing a strong base for the trust to operate from.”
Key contributors to the trust’s performance included its largest holdings, Emitel and CRA, which delivered EBITDA growth of 15.7% and 16.5%, respectively.
Speed Fibre also performed strongly, contributing to aggregate portfolio EBITDA growth of 15.2%. This operational success reflects the managers’ hands-on approach, with in-house expertise driving improvements across the portfolio.
Post-period, Cordiant announced plans to acquire Datacenter United (DCU), a Belgian data centre platform.
“Subject to expected completion in January 2025, this will help with the ongoing goal of diversifying the portfolio, whilst also increasing the allocation to data centres which have arguably the highest growth potential in the portfolio,” said Kepler.
The trust’s rating has improved, with the discount narrowing from 46.7% to 30.5%, translating to a 30.4% gain in share price during the period.
However, Kepler noted: “Despite this, the discount is still wide versus the trust’s historic levels. As such, we believe the current level could still prove an opportunity for long-term investors, especially if the management team continue to deliver.”
Cordiant also announced an interim dividend of 2.1p per share, marking the second increase in its dividend goal since inception.
Kepler stated: “The dividend was comfortably covered by the managers’ preferred adjusted funds from operations metric at 1.8x. Considering the strong performance of the underlying portfolio, we believe the board is in a good position to at least maintain the dividend going forward, though note there is no guarantee.”