HICL Infrastructure (LSE:HICL) reported solid operational performance for the period from 1 October 2025 to 28 February 2026, supported by capital expenditure programmes across its growth assets that helped drive EBITDA improvements and stable cash generation.
The company reaffirmed its dividend guidance, targeting 8.35p per share for the financial year ending 31 March 2026 and 8.50p for 2027. These payouts are expected to be supported by forecast dividend cash cover of around 1.1 times, along with consistent cash flows from the group’s public-private partnership (PPP) portfolio.
As part of its capital allocation strategy, the board completed £225 million of disposals from its UK PPP portfolio at carrying value. Proceeds were used to repay drawings under the company’s revolving credit facility and to fund committed investments. HICL has also restarted share buybacks, which management believes are attractive at the current share price discount.
The company is redeploying capital into its existing growth assets, including Affinity Water, the Blankenburg Tunnel and the B247 road project, while continuing to pursue selective follow-on investments and portfolio optimisation through targeted disposals.
Key assets across the portfolio performed in line with or ahead of expectations. These included Affinity Water, London St. Pancras High Speed and telecommunications tower platform Fortysouth. Expansion capital expenditure, new co-location opportunities and an oversubscribed refinancing supported the strength and resilience of earnings.
Management said inflation trends and movements in bond yields are not expected to have a material near-term impact on the company’s net asset value. The company also noted that recent shareholder consultations following the cancellation of a proposed combination with TRIG indicated continued investor support for HICL’s strategy, portfolio and long-term return profile.
Overall, the company’s outlook is supported by strong cash generation and a solid financial structure. However, recent revenue and earnings momentum has been more modest. Technical indicators appear broadly neutral, while valuation is supported by an attractive dividend yield but is not clearly discounted on earnings multiples. Recent corporate actions, including share buybacks and strategic discussions around portfolio positioning, provide some additional positive sentiment.
More about HICL Infrastructure
HICL Infrastructure PLC is a London-listed investment company managed by InfraRed Capital Partners. The company invests in a diversified portfolio of core infrastructure assets, including public-private partnership projects, utilities, transport and digital infrastructure. Its strategy focuses on delivering stable income and long-term capital growth through investments in essential infrastructure across the UK and selected international markets.
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