Greencoat UK Wind PLC raised its dividend target for the coming year and flagged continued strong cash generation despite what it acknowledged was challenging year for investors.
In results for the 2024 calendar year, the FTGSE 250-listed wind farm investment trust confirmed that it generated 5,484 gigawatt hours of renewable electricity, which was 13% below budget due to low wind, but also generated £278.7 million of cash.
A total of 10p of dividends were declared over the year, with the new target increased 3.5% to 10.35p for 2025, in line with retail price inflation in December.
The net asset value of the portfolio of wind farms ended the year at £3.4 billion or 151.2p per share, compared to £3.8 billion and 164.1p per share a year earlier.
This is based on a diverse portfolio of 49 wind farm assets with net generating capacity of just under 2GW, which powered two million homes in the year, avoiding 2.2 million tonnes of CO2.
At the share price on 31 December 2024, the return to shareholders was 12.5%.
Chairman Lucinda Riches said: "The board and the investment manager recognise that this has been a challenging year for investors, but have been working hard to drive shareholder value through proactive actions and continued active asset management.”
This included buying back 59.2 million of its own shares at an average cost of 137p per share, with a further share buyback programme of £100 million announced for the next 12 months.
Riches said cash generation remained strong despite lower portfolio generation for the year, and over the next five years the board expects the trust to generate over £1 billion in excess cashflow, “and additional capital should be available through further opportunistic disposals, providing optionality for capital allocation and shareholder returns”.
She added: "Notwithstanding the current market conditions, our simple, low risk and proven model remains highly attractive. We have a sizeable and diverse portfolio of high quality assets and are well positioned to help deliver the UK government's net zero ambitions. We are continuing to deliver net returns to investors of 10% on NAV, and we remain confident in our ability to continue to meet our objectives of dividend growth in line with RPI and capital preservation over the longer term."