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NextEnergy Solar earnings boosted by exceptional period of sunshine

The renewable power generator’s electricity production was 11.1% above budget

NextEnergy Solar Fund -

NextEnergy Solar Fund Limited (LON:NESF) said an exceptional period of sunshine boosted generation from its portfolio of solar assets and lifted its earnings in the half-year to end-September.

The renewable power generator’s electricity production was 11.1% above budget helped by above-average irradiation and by having most of its received power prices fixed.

Spot electricity prices were volatile over the period due to oil prices and the coronavirus (COVID-19) pandemic, but rallied at the end of the period and NextEnergy said it has left a significant amount of capacity unhedged for the winter in expectation of a further improvement.

The FTSE 250 firm's earnings per share for the half-year were 4.04p while net assets per share rose to 99.6p from 99p, with total assets also increasing to £583.5mln (2019:£578.6mln).

The dividend target for this year is unchanged at 7.05p, but NextEnergy said it is changing its policy going forward and dropping the link to inflation. In future, the trust said it would look to increase the dividend after considering a range of measures including projected future power prices and associated price hedges and inflation in its markets.

Kevin Lyon, its chairman, said the NextEnergy portfolio had shown its robustnesss and defensiveness in what had been been a difficult period generally.

The technical performance of its plants during the period has been exceptional, he added.

Total installed capacity in the first half remained steady at 755Mw and the trust would pushing ahead with plans to increase its subsidy-free capacity to 150Mw, Lyon said.

Shares rose 1.3% to 106.6p.

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Quick facts: NextEnergy Solar Fund

Price: 99 GBX

LSE:NESF
Market: LSE
Market Cap: £580.92 m
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