MIIF – BT

Macquarie fund’s Q2 adjusted net income up

MACQUARIE International Infrastructure Fund (MIIF) has reported a 22.2 per cent rise in adjusted net income to $48.17 million for the three months ended June 30, 2007.

Total investment revenue for the second quarter rose 44 per cent to $60 million, while earning per share was 11.38 cents.

For the half-year period, adjusted net income stood at $52.81 million while total investment revenue reached $70.4 million.

MIIF said the strong results came from solid performances across its portfolio, with the businesses in which MIIF had invested directly performing particularly well. MIIF’s direct investments include stakes in Taiwan Broadband Communications, Changsu Xinghua Port and UK-broadcaster Arqiva.

MIIF will pay a dividend of 4.15 cents per share – an increase of 5.1 per cent on the previous corresponding six-month period – representing an annualised trading yield of 7.9 per cent per annum.

The fund said it expects to sustain and grow the current level of dividend payout over time.

In line with the commitment to focus the portfolio on Asia, MIIF recently divested its stakes in DUET Group, Macquarie Communications Infrastructure Group and Macquarie Infrastructure Company.

The divestments collectively earned MIIF total gross proceeds of about $271.8 million and a combined return of 14.4 per cent per annum against the combined cost of acquisition. The proceeds were used to repay part of the drawn balance on MIIF’s debt facilities.

In April, MIIF took up its share of the Arqiva rights issue for £pounds;87 million (S$266 million) in support of the acquisition of National Grid Wireless for £pounds;2.5 billion by Arqiva’s parent, Macquarie UK Broadcast Ventures Limited.

In July, Arqiva, which makes up more than a quarter of MIIF’s portfolio by value, signed a long-term contract with SDN Ltd to design, build and operate a new high-power national digital terrestrial TV network in preparation for digital switchover in the UK. The contract signed is worth about £pounds;500 million and will run until 2034, the fund added.

The fund said Asia remains attractive as an investment destination for infrastructure due to factors like rising populations and sustainable economic growth which requires investment in new infrastructure and maintenance of existing ones. Plus, ‘the Asian Development Bank estimates that in East Asia alone, the expected infrastructure service needs will be US$165billion annually over the next five years’.

To meet these needs, it is estimated that some 65 per cent of the expenditure would have to be new investment.

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