Sequoia Economic Infrastructure Income Fund shares were up 0.5% to 87.8p in early morning trading on Monday following its delivery of a 6.25p dividend per ordinary share, in line with its annual target.
The company reported a NAV per ordinary share of 100.5p in FY 2022 against 103.1p in FY 2021, alongside a NAV total return of 3.5% compared to its outperformance in the last year of 13.5%.
Sequoia announced a share price total return of 4.5% from 17.4% year-on-year, with a dividend cash cover of 1.06x compared to 1.04x the year before.
The firm highlighted total net assets of £1.7 billion from £1.8 billion, and an annualised portfolio yield-to-maturity of 8.4% against 9% in the previous year on 31 March 2022.
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The group further mentioned an ongoing charges ratio of 0.8%, remaining flat compared to its ratio in FY 2021.
Sequoia commented it had shifted to a more defensive portfolio over the term, with stronger credit ratings and higher ESG scores.
The firm split its portfolio across 76 investments in eight sectors, 29 sub-sectors and 12 mature jurisdictions.
It reported 95% of its investments in private debt, with 50% in floating rate investments in a move to capture short-term rate rises.
Sequoia also noted a short weighted average life of 4.1 years, creating reinvestment opportunities, and a weighted average equity cushion of 33%.
The company said it believed its trend towards a defensive portfolio with a higher credit rating placed it in a strong position to manage a potentially stagflationary economic stage, and confirmed a positive outlook for the company in FY 2023.
“The Company has remained resilient against the backdrop of significant market volatility. We successfully delivered our dividend target of 6.25p per share on a cash covered basis with a small increase in dividend cover, a position we expect to strengthen in the current year given the rising level of interest income we are now experiencing from our well diversified portfolio,” said Sequoia chair Robert Jennings.
“For some time, we have focused on more defensive loans with stronger credit ratings and better ESG metrics, a pattern we expect to hold to for the foreseeable future. We believe our economic infrastructure portfolio is well positioned for a higher interest rate and potential stagflationary environment and we remain confident in the outlook for our Company.”