The Fund recorded a loss of 1.53% in September (C Accumulation GBP), which pushed performance for the third quarter into negative territory. While disappointing, the strategy’s 0.85% decline over the past three months compares very favourably with the performance of the broader global infrastructure sector – the MSCI World Infrastructure Index lost 4.4% in value over the same timeframe (GBP adjusted).

In a continuation of recent trends, the major detractors to performance were US-listed names reacting negatively to a surge in US Treasury yields. Brookfield Renewables Corp. (-9.7% in September GBP-adjusted), XPLR Infrastructure (-8.8% GBP adjusted), HA Sustainable Infrastructure (-8.6% GBP-adjusted) and to a lesser extent Clearway Energy Inc. (-4.5% GBP-adjusted) provided the greatest headwinds. Meanwhile, Northland Power (+8.7% GBP-adjusted), Greencoat UK Wind (+4.8%), and The Renewables Infrastructure Group (+3.9%) were the main contributors.

A new position in Mercury NZ was initiated in September. Mercury is listed in New Zealand where it operates as a vertically integrated electricity generator and energy retailer serving the domestic market (18% share of electricity generation). The company’s generation portfolio comprises hydroelectric, geothermal and wind power. The company offers an attractive ~5.5% gross yield, and with a payout ratio currently towards the lower end of the 70 – 85% target range (in relation to operating free cash flow), there is scope for income growth in the years ahead. The new position sits alongside its peer and long-standing constituent of the Fund, Meridian Energy, which has proved a stable allocation for the strategy over time, delivering a consistent and reliable distribution.

Capital was also deployed into Redeia, the Spanish electricity transmission network operator, and Brookfield Renewable Corp. on price weakness. The Investment Manager has been keen to add opportunistically to core North American holdings such as Brookfield, which have sold off sharply in recent months in reaction to rapidly rising Treasury yields. Greencoat UK Wind, The Renewables Infrastructure Group were among several positions reduced at the margins. The Fund closed the period with a healthy cash balance of approximately 5%, providing flexibility to deploy further capital in the near term.

Third quarter distributions

Income distributions relating to the third quarter of 2026, payable in October 2026, amounted to 1.5366p per C Income GBP unit and 1.3515p per I Income GBP unit. Third quarter distributions are considerably higher when compared with the same period in 2025, and overall distributions declared for the first nine months of 2026 are 22.5% higher year-on-year. While the Investment Manager anticipates fourth quarter distributions will be lower on an annual comparison, overall distributions for 2026 should still record improvement year-on-year. As at 30th September, the Fund’s trailing 12-month yield was 6.23% for the C Income GBP units.