In this webinar, Phil Kent, Robyn MacHugh and Cameron Gardner provide an update following the publication of GCP Infrastructure Investments Limited’s Half-Yearly Report and Financial Statements 2026. They outlined continued portfolio resilience, progress on its capital allocation strategy, and a clear framework for future shareholder returns.

Below are the key takeaways from the webinar and you can watch the replay here:

GCP reaffirmed its 7.0p per share dividend target for FY2026, maintaining the company’s long-standing focus on delivering stable income to shareholders.

During the six-month period to 31 March 2026:

• 3.5p per share dividend was paid in line with annual guidance
• Dividend coverage stood at 0.97x, broadly in line with management’s target of paying out underlying income efficiently
• Dividend sustainability remains central to the investment proposition

Importantly, the Investment Adviser highlighted that ongoing share buybacks are accretive to dividend coverage, reducing the overall share count while preserving income generation.

The team provided a significant update on the capital allocation framework first introduced in late 2023 to address the persistent discount to NAV.

Progress to date includes:

• ~£130 million of completed or announced disposals, broadly achieved at NAV
• Reduction in net debt from £104 million to just £5 million¹
• Share buybacks of 73 million completed equating to £54 million² of capital returned to shareholders

¹As at 2 June 2026. ²March 2023 to 9 June 2026

Asset disposals continue to demonstrate that reported NAV remains an appropriate reflection of underlying asset value, despite the company’s shares continuing to trade at a discount.

A major focus of the webinar was management’s newly articulated framework governing future capital deployment.

The framework establishes three broad scenarios based on the company’s discount to NAV:

• Discount wider than ~15% → Continue prioritising buybacks and returning capital to shareholders
• Discount between ~5%–15% (“Grey Zone”) → Balance buybacks with selective reinvestment opportunities
• Discount narrows materially → Greater scope for reinvestment into attractive new opportunities

The Investment Adviser confirmed that asset disposals will continue in all scenarios while shares trade below NAV. They also stated their intention to maintain NAV above £750 million, preserving scale and liquidity.

The team outlined a highly active disposal pipeline expected to generate substantial cash over the coming weeks.

Near-term transactions include:

• Completion of already announced £47 million supported social housing disposal (exchanged earlier this year)
• £40 million solar refinancing transaction due to complete within weeks
• £10 million onshore wind disposal expected by month-end

Collectively, management expects approximately £100 million of cash proceeds by mid-July 2026, which will feed directly into the capital allocation framework.

The Investment Adviser continues to reshape the portfolio toward lower-risk, shorter-duration assets.

Current portfolio metrics (31 March 2026):

• £851 million portfolio value
• 47 investments across 3 main sectors, and 18 sub sectors
• Weighted average loan life of 11 years
• Weighted average annualised yield of 8.0%
• 49% of loans benefit from some form of inflation protection
• Zero construction exposure

Following planned disposals:

• Portfolio duration is expected to fall from 11 years to 8 years
• Weighted average yield expected to rise by approximately 0.3%

The team highlighted that reducing equity-like renewable exposures will improve portfolio defensiveness.

While the Company maintains a disciplined approach to renewable energy valuations, the portfolio remains sensitive to electricity price assumptions. This sensitivity is gradually declining as the portfolio evolves.

• Power prices remain elevated in the short term due to ongoing geopolitical disruption in the Middle East
• The Company continues to reduce exposure to long-dated merchant power prices
• The Investment Adviser believes some market forecasts may underestimate the persistence of elevated energy prices over the medium term, particularly in light of the damage to key infrastructure caused by the war.

They also noted ongoing work to extend asset lives for wind and solar assets, which could materially improve future valuations.

NAV performance remained relatively stable over the six-month period.

Key financial highlights:

• NAV of £829 million
• NAV per share of 100.26p
• £17 million profit generated during the period
• Total shareholder return of 5% during the six months
• 192% total NAV return since IPO

NAV movements were relatively modest, with:

• £6.5 million upward revaluations
• £8.5 million downward revaluations
• Net negative movement of approximately £2 million

The largest negative factor was the UK government’s decision to shift renewable subsidy indexation from RPI to CPI.

The team highlighted the portfolio’s strong amortising debt structure and predictable cash generation profile.

Notably:

• Portfolio expected to receive £280 million of principal repayments over the next four years through normal amortisation alone
• This excludes additional proceeds from planned disposals and refinancings
• The Investment Adviser reiterated that the Company’s debt-focused strategy provides strong capital preservation characteristics with limited residual asset value risk

There were positive changes in the shareholder register over the period.

Recent developments include:

• Increased participation from retail investors through platforms such as AJ Bell and Hargreaves Lansdown
• A new UK pension scheme investor joining the register
• Reduction in shorter-term shareholders with greater presence of long-term capital

The team indicated this shift reflects growing confidence in the Company’s strategy and value proposition.

The team described the period as largely “business as usual operationally, but strategically transformational.”

The focus for the remainder of 2026 will be:

• Completing near-term disposals
• Continuing buybacks while shares trade at a discount
• Maintaining dividend stability
• Further reducing portfolio risk while preserving income generation

With a more disciplined capital allocation framework now in place, management believes GCP is well positioned to narrow the discount to NAV while continuing to deliver predictable long-term shareholder returns.

Important Information

This article has been prepared by Gravis Capital Management Limited (the "Investment Adviser“ or “Gravis”) and is for information purposes only. It is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to local law or regulation. Any recipients of this article outside the UK should inform themselves of and observe any applicable legal or regulatory requirements in their jurisdiction and are treated as having represented that they are able to receive this article without contravention of any law or regulation in the jurisdiction in which they reside or conduct business.

This article should not be considered as a recommendation, invitation or inducement that any investor should subscribe for, dispose of or purchase any such securities or enter into any other transaction in the GCP Infrastructure Investments Ltd (the “Company”) or any other fund affiliated with Gravis.  The merits and suitability of any investment action in relation to securities should be considered carefully and involve, among other things, an assessment of the legal, tax, accounting, regulatory, financial, credit and other related aspects of such securities.

No undertaking, representation, warranty or other assurance, express or implied, is made or given by or on behalf of the Company, the Investment Adviser or any of their respective directors, officers, partners, employees, agents or advisers or any other person as to the accuracy or completeness of the information or opinions contained in this article and no responsibility or liability is accepted by any of them for any such information or opinions or for any errors, omissions, misstatements, negligence or otherwise for any other communication written or otherwise. In addition, neither the Company or the Investment Adviser undertake any obligation to update or to correct any inaccuracies which may become apparent. The information in this article is subject to updating, completion, revision, further verification and amendment without notice.

Past performance is no guarantee of future performance.

Gravis Capital Management Ltd is authorised and regulated by the Financial Conduct Authority; registered in England and Wales No: 10471852 and its principal place of business is 24 Savile Row, London W1S 2ES.