IFT - Infratil

[Left Field]

Wellington City Council has apparently  voted today to put the sale of its 30% holding of Wellington Airport into its long term plans for further consideration and consultation.

Many see this as an opportunity for IFT to purchase WCC's share of the airport.

I also see it as a good opportunity for IFT to reduce or sell out its interest in Wellington airport.

IMO Wellington airport is now a bit of an orphan in IFT's portfolio and there may be much better returns to be had elsewhere in IFT's portfolio of data centres, communications and renewable energy which all are capital hungry.

Interesting times ahead for holders.

[Hectorplains]

 AFR's Street talk tonight :

Morrison & Co-backed data centre owner CDC Data Centres is busy restocking its balance sheet with a new debt package.

Street Talk understands CDC is working with Barrenjoey Capital Partners to supersize its bank debt facilities by circa $800 million. Sources said debt presentations are under way, with the Commonwealth Bank expected to lead the syndicate.


CDC's last loan was for $2.7 billion in November 2022, similarly arranged by Barrenjoey. Fifteen lenders came on at the same time the company raised $308 million in 10-year and 15-year private placements. In May, CDC raised another $230 million in 10-year ninja loans from Japanese lenders.

The company has enjoyed a rapid growth trajectory since its founding in 2007. New Zealand-listed renewable energy infrastructure investor Infratil issued a fresh valuation of its investment in CDC in October, showing a $448 million increase over the six months since its March 31 assessment. The Kiwi giant now puts its 47.99 per cent stake in CDC between $3.64 billion and $4.19 billion – or a midpoint of $3.88 billion – implying $8.09 billion for 100 per cent of the business.

Full-year earnings before interest, tax, depreciation, amortisation and fair value adjustments guidance of $260 million to $270 million imply an EBITDA multiple north of 30-times.

The valuation boost was closely watched by much larger rival AirTrunk, which is mulling an initial public offering or trade sale. AirTrunk's contracted EBITDA is understood to be upwards of $600 million. Applying a 30-times multiple implies an enterprise value of $18 billion. Strip out $5 billion-odd of debt and that's an IPO closer to $13 billion rather than the $10 billion figure being bandied around.

Top talent
CDC builds, owns and operates data centres across Australia and New Zealand. The company has a strong grip on the federal government's data centre spending with six centres at Hume and Fyshwick in Canberra, as well as three large ones at Eastern Creek in western Sydney.

It's jointly owned by Infratil Ltd and public servants' superannuation fund Commonwealth Superannuation Corporation. Infrastructure manager Morrison & Co manages the investment on behalf of both shareholders.

CDC's meteoric rise has been overseen by a well-regarded leadership team, which includes chief executive Greg Boorer and former APN News & Media boss Brett Chenoweth as chairman.

Since leaving APN in 2013, Chenoweth has quietly accumulated a David Gonski-esque portfolio, chairing a wide range of companies including ASX-listed bedding and furniture group Adairs and film distribution and production group Madman Entertainment. He's also a non-executive director at wagering giant Tabcorp; One NZ, formerly Vodafone New Zealand; Surfing Australia; Thredbo owner ASX-listed EVT; and most recently RetireAustralia, among others.

[Left Field]

Huge crossing of 200,000 shares at ATH of $10.60 on closing today.....

Someone optimistic about results tomorrow.

[BlackPeter]

Huge crossing of 200,000 shares at ATH of $10.60 on closing today.....

Someone optimistic about results tomorrow.

As many pessimists as optimists ... I guess somebody must have sold the shares, didn't they?

[Left Field]

Great result..... plus upgrade. Naaiiice.

Infratil today announced a net parent surplus from continuing operations of $1,215.1 million for the six months to 30 September 2023. The result included a $1,064.5 million revaluation of Infratil's initial 49.95% stake in One NZ, following the acquisition of a further 49.95% stake in June this year.

Proportionate EBITDAF was $400.0 million – a 45% increase on the $275.6 million from the same period the previous year.........

......"The operating performance across our portfolio gives us the confidence to lift and narrow our FY2024 Proportionate EBITDAF guidance from $800 - $840 million, to $820 - $850 million. .

https://www.nzx.com/announcements/421750

Comments around prospects for renewable energy and data centres look v promising.

Mr Boyes highlighted that Infratil retains significant liquidity to support further internal and external investment opportunities with $1.0 billion of available capacity to fund growth, including significant undrawn corporate facilities. At 30 September, gearing was 19.7%, up from 9.8% at 31 March.

"As we head into a period which is likely to be dominated by a continuation of the macro-economic uncertainty that we are currently experiencing, we are excited about the level of opportunity for continued investment across our existing portfolio. These opportunities are likely to continue to exceed our available capital, allowing us to continue to prioritise the highest value opportunities for shareholders.

"In terms of our returns to shareholders, we will pay a partially imputed interim dividend of 7.00 cents per share, a 3.7% increase from the prior year. Over the first half of FY2024, Infratil has delivered a total shareholder return of 14.1%, while the NZX50 was down 6.6% over the period. For the 12 months to 30 September 2023, Infratil's total shareholder return was 22.3%.

[Swala]

Very pleasing result. Onwards and upwards!

[LoungeLizard]

Strange that IFT have nosedived - at last count 43c - on the back of a strong result. Hard to figure, especially as it opened strongly. Why would anyone bail now? Tempted to buy more.

[Left Field]

Strange that IFT have nosedived - at last count 43c - on the back of a strong result. Hard to figure, especially as it opened strongly. Why would anyone bail now? Tempted to buy more.

About 12 months ago IFT was around $8.50. Likely some profit taking place today and the purchaser of 200,000 shares yesterday at $10.60 may be feeling about $80,000 less optimistic today!

As BP points out above....for every buyer, there is a seller.

In addition, as approx 50% (or $1,064 mill) of the 'surplus' came from revaluations..... maybe the market is a bit sceptical. (How much would you value a One NZ at?)


Longer term...... no worries.

[Left Field]

IFT starting the year well......naaaiiice.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/IFT/424251/410410.pdf

[Mos]

IFT starting the year well......naaaiiice.

http://nzx-prod-s7fsd7f98s.s3-website-ap-southeast-2.amazonaws.com/attachments/IFT/424251/410410.pdf

Absolutely. CDC continues to be a great value creating investment with sustainable tail winds. The exponential growth in data storage just warming up - will require lots of Infratil renewable energy to power it!

[Left Field]

More good news

https://www.nzx.com/announcements/424962

SP settling in above $10 now........ onwards and upwards.

[LoungeLizard]

More good news

https://www.nzx.com/announcements/424962

SP settling in above $10 now........ onwards and upwards.

Yep, $11 by year end

[Left Field]

Yep, $11 by year end

Naaiice crossing today....360k shares @ $10.46

[LoungeLizard]

Naaiice crossing today....360k shares @ $10.46

Closed at $10.60. Might have to revise my year-end estimate!

IFT has been the best performer of my holdings by a long chalk. I began accumulating only 5 years ago but the price then was a modest $3.75 - a trebling in value over those 5 years! Its growth has been relentless and I see no reason why it won't continue. All things being equal, I wouldn't be surprised at all if the SP wasn't $20 in another 5 years.

[Left Field]

And $10.60 closing on a reasonable volume of 81,000 shares.

Well done Lizard..... high conviction hold for me too....now  at 20% of my portfolio.