Good morning, everyone, thank you for joining us today for the interim results presentation for Triple Point Energy Transition plc or TENT for the six-month period ended the 30th of September 2022. My name is Jonathan Hick, and I am the fund manager of TENT. I'm joined today by my colleague, Christophe Arnoult, a director in our portfolio team. In this presentation, we will be providing you with an overview of the activities of the company over the course of the interim period, the financial results for that period, and the outlook for the company. First, I wanted to start off today by recapping the opportunity that TENT is seeking to take advantage of. It's an opportunity that each of us lives and experiences every day, because as recent events have highlighted more than ever, energy underpins everything. It is the lifeblood of modern society and the global economy. From providing light and warmth in people's homes to enabling the innovations and research that are engines of economic progress, energy is the basis for everything we do in our modern world, and that is why demand is set to increase significantly over the coming decades. But when a substantial portion of that energy comes from burning fossil fuels, which harm society, and when the majority of the energy is lost before it ever reaches the end user, the energy system that sustains us becomes unsustainable. The importance of net zero is fortunately now well understood and enshrined in law in the U.K. and in many countries around the world. This sits alongside more ambitious goals, for example, to have a net zero power system in just 13 years' time in the U.K. TENT's investment case is underpinned by more than law and ambitions around net zero. The invasion of Ukraine earlier this year and the restriction by Russia of gas flows into Europe has led to a focus by governments on energy security. This focus is across the energy spectrum, from producing more energy from readily available renewable sources to reducing demand for heat and electricity. The third trend that underpins TENT's investment case is structurally high energy prices, which are high based on market design structures that link the price of the cost of gas in the UK under a principle known as short-run marginal cost. By investing in a more efficient, lower carbon energy infrastructure that helps transition to a net zero world, TENT is also therefore reducing costs for consumers and improving energy security. Delivering that more efficient, lower carbon energy system requires a holistic approach, and we have set out on this slide how we see that and how it is all interconnected. Starting with the generation and supply of energy, a net zero world requires a move away from centralized fossil fuel generation to decentralized renewables. As we set out in our IPO prospectus, these assets should be located as close to centers of demand as possible. On the demand side, we need to reduce the grid energy requirements of businesses and households. This can be achieved either through demand reduction measures, such as building retrofit or LED lighting, or through generating energy that is required on site, for example, rooftop solar on commercial premises or social housing and heat networks or, for example, combined heat and power engines. Finally, in the middle, energy storage and distribution plays an important role in balancing the increasingly volatile and unpredictable demand and supply profiles of our changing society. Enough energy was lost from wind energy alone in 2021 to power 1 million homes as a function of curtailment, showing the importance of flexible assets to balance supply and demand, as well as provide inertia and frequency response services. I'd like to highlight that beyond simply delivering a comprehensive strategy for improving the efficiency and reducing the carbon intensity of U.K. energy infrastructure, we also believe that having exposure across these three different segments of the energy system provides a compelling blend of risk and return characteristics for our shareholders. Specifically, our holistic view drives investment into a diverse portfolio of assets across a range of different technologies. Indeed, a number of these diverse technologies are actually complementary in nature. For example, renewable generation and Battery Storage are often seen as a natural hedge in that storage typically has a role in dispatching power at times of reduced renewable generation. Since IPO, TENT has invested in assets that bring that investment thesis to life. The results from this interim period evidence that our investment thesis can deliver both strong returns as well as risk mitigation in the current environment. With regard to returns, the underlying portfolio NAV grew by 6% in the period, reflecting the improved outlook for power prices as well as elevated levels of inflation. Accordingly, the total NAV return for the six-month period was 7.2%. The dividends paid in the period were covered but substantially by earnings, and as the Battery Energy Storage portfolio is built out, the company expects its earnings to grow further in future periods. From a risk perspective, the portfolio is highly diversified, underpinned by 17 individual assets with 8 different off-takers to whom we sell a range of different products from heat to capacity reserve, frequency response, energy efficiency equipment, and also electricity. Those revenues are currently generated from 4 different technologies across the spectrum of the U.K. energy market. Whilst we have talked before about the benefits of our diversified approach, this period has provided clear evidence of the benefits of such a strategy. The company does not expect to be impacted by the Electricity Generator Levy, the so-called windfall tax, as a function of not having a concentration of assets in any one particular part of the U.K. energy system. Whilst inflation and high energy prices represent risks to some business models, many of TENT's investees benefit from inflation-protected contractual revenue streams. For example, our hydroelectric assets through the feed-in tariff subsidy, as well as wholesale power prices. Approximately 50% of TENT's income is contractually linked to RPI. I will now hand over to my colleague, Christophe, to speak to some of the more specific financial and ESG highlights from the period. Good morning, everyone. I will present the key financials, and ESG metrics for the period ended on the 30th of September 2022. The capital deployed in the period was GBP 1.1 million in Lighting as a Service investment. While a small initial investment, this is a great addition to our portfolio and has opened a pipeline of opportunities which I will develop later in a case study. The portfolio valuation is GBP 84.1 million. This is up by 6.7% from the audited NAV reported at the end of March 2022. The fully invested portfolio valuation, GBP 129 million, this is the current portfolio value plus the value committed in the portfolio of battery assets. The NAV per share is 100.26 pence. This is up by 4.3% since March 2022. The company's annualized ongoing charge ratio is 1.89%. The company benefits from an RCF of GBP 40 million, which is at fixed interest rate at 4.5%. The company is in discussion with its lender in respect of extending the RCF upon its maturity in March 2024. The company paid dividend totaling 2.75 pence per share for the first six months of the financial year of 2023. Circa 4.9 GW of renewable energy was generated by the hydro portfolio in Scotland. This is the equivalent of an average annual electricity consumption of circa 1,600 UK households. 8,700 tons of CO2 equivalents were avoided in the period, and 2.77 GWh of energy were saved. I will now move on to the statements of comprehensive income. The company received GBP 2.7 million investment income in the period. This is 164% increase compared to the same period last year. This is driven by incomes from the 9 hydro schemes acquired in November and December 2021. The revaluation of the company's fully owned subsidiary contributed GBP 5 million to the profit before tax. This is the balance. This is with the balance being represented by earnings from the hydroelectric and CHP portfolios, offset by expenses incurred at company level. The bridge will be presented later by Jonathan. The operating expenses for the six months ended on the 30th of September 2022 amounted for GBP 927K, covering the management fees and the company's other expenses. The cash dividend cover represented by cash income from the portfolio, net of the company and subsidiary expenses and finance costs, increased significantly to 98% in the six months ended in September 2022. This was facilitated by the dividend distribution received from the hydroelectric portfolio and a full contribution over the period from the investment completed in the year ended in March 2022. You will find the detail in appendix of this presentation. As Jonathan mentioned just now to you, the growth of the earning has enabled TENT to substantially cover its dividend payment in the period ended in September. Sorry, the company owned and the company holds GBP 160 million assets, which is made of GBP 84.8 million of investment at fair value, 466K trades and other receivables, and GBP 15.38 million of cash and cash equivalents. The net asset value is GBP 100 million, 69,000 pounds. The company returned a NAV per share of 126 pence for the period ended in September. This, combined with the 2.75 pence of share dividend paid, has delivered an average return of 7.2% over the last six months. This is up from 4.9% in March 2022. This is the effect of the dividend being covered by earnings at 98% and the increase in the company NAV, driven by the portfolio valuation increase. The value of the fully invested portfolio at cost is GBP 128.2 million. This means we have a smaller group, and we have the capacity to continue to invest in strategy projects. I will now hand back to Jonathan for the portfolio valuation. Thank you, Christophe. The bar chart here shows the movement in portfolio valuation throughout the period. On the left-hand side, we show the movement in the portfolio at book value. In the period, investments were made into Lighting as a Service investments, as Christophe outlined, with a leading global logistics business totaling GBP 1.1 million. This was offset by cash receipts from our CHP investee companies. During the period, the valuation of those investments was uplifted by increased expectations in inflation and power prices, as seen on the right-hand side, offset by increasing discount rates in the hydro portfolio by 50 basis points. The weighted average discount rate on the operational portfolio increased to 6.4% as a result of increasing the discount rate on the hydro by 50 basis points. Once committed capital is fully deployed into the energy storage portfolio, this will increase to 7.1%. TENT continues to use conservative assumptions in its asset level projections. For example, the approach taken to inflation modeling is to use Office for Budget Responsibility's year ahead projection for the 12-month period, followed by a long-term assumption of 3% for RPI and power price inflation. We note that 3% is at the lower end of the comparative benchmarks and expectations of inflation over a two-to-five-year period. By taking an average of the last two most recently available power curves, TENT is effectively discounting the latest power curve projections and not taking the full benefit of the recent increases in future power price expectations. Turning from the portfolio valuation to the company as a whole, the NAV increased to in excess of GBP 100 million, driven by fair value gains from the underlying portfolio and investment income received in the period that Christophe described earlier. This was offset by the 2 dividend payments made in the year, as well as company expenses. The company considers the key sensitivities to its projections to be inflation, power prices, discount rates, and energy generation yield. These are in line with previous periods and expectations and shows the positive correlation of NAV, inflation and power prices, which are the 2 factors that are driving the global macroeconomic agenda. The company's valuations are based on the discounted cash flow model in line with IPEV guidelines, with key project assumptions such as energy yields verified by independent technical experts. Discount rates and other key non-technical assumptions are reviewed by Mazars as the company's valuation advisor and the company's auditors, BDO. I will now hand back to Christophe, who will take you through some of the deployments made in the period, as well as the portfolio management activities over the same. During the period, TENT invested GBP 1.1 million in the lighting replacement scheme. I will use the project as a case study demonstrating the importance of investments in the energy efficiency sector, the third target segment for investment strategy, on-site generation and efficiency consumption. TENT provides a financing solution to a lead installer to replace existing light in the warehouses of a global logistic operator. This results in a 20% reduction in the energy consumption for the lighting needs. TENT receives monthly installment to repay the loan over a five-year period. This is the first lead project for TENT. It has now opened a substantial pipeline of follow-up investment in this sector, providing adjusted return above the fund NAV return, therefore enhancing the portfolio return and providing high security for the on-site protection. Circa 1 million of further pipeline has been committed in the post-balance period with the same counterparty, the same lead installer, with approximately 300,000 GBP drawn to date. The full pipeline is estimated to be circa 6 million GBP. The Lighting-as-a-Service model can be replicated in other application on the on-site energy efficiency sector, such as Heating as a Service project, which we are currently discussing with potential clients. In the next part, I will provide an update on the Battery Storage portfolio. The Battery Storage portfolio is developed by Field and financed by TENT through a 45 million GBP facility to fund four Battery Energy Storage project. The BESS project support the second target segment of our investment strategy, energy storage and distribution. The first phase of the portfolio includes four projects distributed across England, Wales and Scotland, which provide a natural edge against regional and locational pricing if introduced in the future. There are three revenue streams targeted: ancillary service, including frequency response and grid balancing services such as Dynamic Containment, the wholesale trading in established energy market such as the intraday market, and capacity market, providing reserve power at time of high demand. The first project, Oldham, near Manchester, reached commercial operations in November, and the second project, Gerrards Cross, is under construction. The facility has drawn GBP 5.5 million to date, and the expected returns for the investment have increased since the last reporting date. I will use the next section to summarize and illustrate some of the initiatives taken as part of our active asset management approach. In the past period, the team focused on the strengthening and formalizing our portfolio management processes. This will provide the framework and method to manage our growing portfolio in the future. The value enhancement initiatives focused on optimization and efficiencies in our current portfolio by renegotiating contracts and consolidating our outsourced support service. This also includes reviewing CapEx and replacement needs to keep the high technical availability of the operational assets. We also identified and assessed an opportunity to increase the annual power generation of our current hydro portfolio with the development of a small storage capacity upstream one of the key schemes. The team will continue to drive this optimization project and look for further opportunities while waiting for inorganic growth. The fund purpose is to support the energy transition and decarbonization of our day-to-day life. Sustainability and decarbonization is at the heart of our investment strategy. Our commitment is articulated around four pillars. The first one, energy transition alignment. Right from the screening phase, our origination and execution team is assessing the merit of the project in our three target segments. The ESG research, analysis, and integration illustrated by a continuous co-commitment to research and develop our KPIs to support the reporting of the portfolio performances. The asset optimization and sustainable outcome will drive the continuous improvement of the performance of our existing portfolio to maximize the positive impact measures measured in terms of CO2 equivalent avoided and gigawatt hours of renewable energy generated. Finally, the transparency and governance. This is illustrated by the inclusion of ESG performance reporting in the contract were negotiated in the period. We're using our leverage to push for more reporting and transparency down the line. The details of the investment manager's approach to ESG integration, including climate analysis and disclosure in line with the TCFD, will be reported in the annual report in the year ending 31st of March 2023. I will now hand back to Jonathan. In this next section, we will talk about some of the key aspects of the company as at the 30th of September in relation to key economic and sector trends, both in terms of diversification, inflation protection, and the impact of recent regulatory announcements in respect to windfall taxes and market reforms. On this slide, we break out the exposure by underlying investee in the company. The first three bars, Harvest, Glasshouse, and Spark Steam on the left-hand side, are the 3 CHP investments that we made earlier in the year. The light green bars are the hydroelectric power companies which the company acquired at the end of 2021, and the dark blue colored bar represents the LED lighting investment that Christophe mentioned earlier on in the presentation. On the right-hand side of that, are the four assets that form part of the BESS portfolio that we committed to build out in March 2022. I think this slide shows, the portfolio benefits from strong asset and technology diversification. The portfolio has also strong geographic diversification and by having a mixture of construction stage projects as well as operational assets. We estimate that TENT has a little in front of GBP 6 million of available capital to allocate to investments from its RCF, and they're in discussions with regard to a number of attractive opportunities. We know that understanding the impact of inflation on their investment is important for our shareholders. On this slide, we set out how our investee companies benefit from strong line of sight for revenues and benefit from a meaningful component of inflation protections. As the bar chart at the bottom illustrates, the assets benefit from contracts that are nine years or more in length. With regard to inflation protection, the CHP energy service companies all benefit from energy supply arrangements, where a substantial component of revenue comes from RPI-linked availability payments. The remainder comes from sales of energy to the grid or private customers, and we note that typically energy prices and inflation are positively correlated. Indeed, at present, energy is one of the primary drivers of inflation. The hydroelectric assets have inflation protections built into the feed-in tariff agreements, as outlined earlier, meaning that inflation represents an uplift in cash flows from those assets. Finally, the BESS assets which we've invested in would also expect to benefit to an extent from higher inflation, given the correlation between energy prices and inflation. As well as being well-protected and indeed benefiting from inflation, the diverse portfolio of assets is well-placed in the face of a number of important regulatory announcements impacting the energy sector. The first relates to the Review of Electricity Market Arrangements, or REMA, for which the government consultation closed about a month ago. REMA is seeking to accelerate the transition to net zero through potential changes to the electricity market design. Under particular consideration are changes to the short-run marginal cost approach to pricing electricity, whereby the most expensive technology sets the price for all other generation technologies, which is typically gas. The government has rightly been concerned about the recent high gas prices, both from a fuel poverty perspective as well as energy security perspective, and we may seek to decouple the gas price from prices for renewable generation. This could lead to lower income for renewable generation assets. REMA is also considering introducing regional or nodal pricing arrangements, both effectively a form of geographic-based pricing, which would lead to numerous different market prices depending on where an asset was situated. Whilst the outcomes of REMA are still some way away, the impact on some technologies could be material. For example, wind assets that are situated far from demand and with generation profiles that do not correspond to consumption profiles, they could see much lower catch prices and lower revenues as a result. The second key trend is one we've already touched on, the Electricity Generation Levy, which was announced a few weeks ago and which sees additional rates of tax being levied on excess profits. TENT is not impacted by the Electricity Generator Levy given its weighting across all segments of the energy market, as opposed to, for example, being solely in generation. That diversification should also mitigate risks to investors once the results of REMA are known. The growing regulatory interventions in the space increase complexity in what is a highly technical market and play to TENT's strengths in managing a diversified portfolio of assets for investors. The final point in our table is one we talk about frequently. The diversified approach provides us with the ability to move away from areas of significant yield compression and high asset valuations and target attractive areas of risk-adjusted return. You can see from our portfolio that we have stayed away from the traditional focus of other listed investment trusts, being wind and solar, because we do not believe the returns are attractive enough in the current market and also a desire to direct capital into other areas of the energy transition. Accordingly, TENT offers our shareholders something different from other listed energy trusts. In summary, the value of a diverse portfolio across a range of assets that are not typically available to other listed equity investors provides TENT in a good place from a risk and return perspective for the future. In terms of other updates on the company since our last results, during the period, the shareholders voted to approve a new investment policy. The changes were largely focused on clarifications to the existing policy. The changes also enabled TENT to invest a minority of its capital into Europe. This was driven by the desire to work with our portfolio and pipeline partners in more than one geography. For example, a Battery Storage company we have funded is already active in Italy, Germany, and other European locations. The name of the company was also changed to better reflect the mandate and contents of the IPO prospectus and the three target market segments that have been integral to the company since its IPO. The company also made a number of senior hires from Bluefield and European Bank for Reconstruction and Development, respectively, as well as Christophe joining us, who you've heard from today. TENT was admitted to the premium segment of the London Stock Exchange. This step was taken to enable the trust to market itself to new investors and improve liquidity for existing shareholders. Finally, TENT has commenced discussions to extend the RCF that matures in March 2024. Whilst the company expects a higher interest cost than the current 4.5% fixed rate that it currently pays, we do not expect this to impact the outlook for full dividend coverage. The near-term pipeline at the end of the period was a little over GBP 162 million, with a wider pipeline of GBP 472 million. There are two key points we want to get across here. First, across near and wider term pipeline, over GBP 70 million of the pipeline has been secured through first right of refusal agreements, providing contraction to pin pathway to scaling TENT with established partners. Secondly, we are particularly pleased with the spread across the wider opportunity set and over our three target segments. We see this as a strong validation of our approach of taking a holistic, diversified approach to the energy transition. We are seeing particularly strong pipeline in storage and in electric vehicle charging and are actively pursuing opportunities in both segments. Our approach to origination remains to look for multiple revenue streams and strong downside protections with good visibility on earnings and inflation protection. The company's focus will be on equity transactions going forward whilst continuing to focus on the technologies that are overlooked by many investors in the transition to net zero. To conclude, TENT net earnings increased by 174% versus September 2021. This has meant that dividend payments have been substantially covered in the period. The earnings base of the portfolio is expected to increase in the future as the BESS portfolio is commissioned, providing further income with which to cover dividend payments. The underlying portfolio NAV has grown by 6% in the period, leading to a total NAV return across the company of in excess of 7% in just six months in the period to September 30th. We believe the biggest strength of our portfolio is in the diversification. 17 underlying assets generating revenue from eight different commercial and government counterparties, selling everything from heat to electricity, storage capacity to frequency response, and energy efficiency equipment enabled by four different technologies spread across our three target market segments with both construction and operational assets in the portfolio. Today, we can point to the tangible benefits of that strategy. TENT will not be impacted by the Electricity Generator Levy announced recently, and in the face of a changing sector with increased regulatory intervention, the value of a specialist energy team building a diverse portfolio across a range of different sectors of the energy transition has never been more evident. Accordingly, the outlook for TENT remains attractive. High energy prices and inflation are strong tailwinds from an earnings perspective. Government regulation in respect of decarbonization of the power sector and overall net zero in the economy by 2050 underpin the opportunity over the longer term. Areas of the mandate, particularly around decarbonizing transport, decarbonizing heat, and energy storage, remain compelling opportunities for the company to support the energy transition.
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