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Sequoia Economic Infrastructure Income Fund Ltd on Wednesday said it outperformed its target with its portfolio of defensive asset classes. The London-based investor looks for opportunities in income-generating economic infrastructure debt with a portfolio of private debt and bond investments. In the year that ended March 31, net asset value stood at 93.77 pence per share, up 0.5% from 93.26p the year prior. Net asset value total return was positive 8.1% from negative 0.9% previously, ahead of Sequoia’s target between 7% to 8%. The fund increased its total dividend by 4.8% to 6.88p from 6.56p. According to the fund, the increase in the NAV was largely due to strong interest income during the year, offset in part by dividends, operating costs and negative valuation changes. Chief Executive Officer Randall Sandstrom said: ‘The infrastructure sector presents numerous exciting opportunities in the short, medium and longer term, and we anticipate significant developments in the market over the coming years. It continues to be a defensive asset class with steadier returns, higher yields and lower loss rates than comparable corporate bonds.’ Looking ahead, management said there are reasons for ‘cautious optimism’ as inflation rates across the US, UK, and Europe continue to trend down. Further ‘positive tailwinds’ include the forecasted drop in short term interest rates in the second half of 2024 and through to 2026, as well as the peak in market default rates expected later this year and during 2025. The fund said it would continue to monitor its share price and, where appropriate, engage in ‘limited’ share buybacks going forward. This follows the return of £88 million to investors in the most recent buyback programme. Sequoia EIIF shares were up 0.4% to 79.75 pence each in London on Wednesday morning. Copyright 2024 Alliance News Ltd. All Rights Reserved.
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