MARKET RELEASE
CHALLENGER INFRASTRUCTURE FUND FY12 RESULTS LBC and Inexus EBITDA in line with expectations Consolidated loss after tax attributable to unit holders AUD$102.1 million
29 August 2012, Sydney - Challenger Infrastructure Fund (ASX:
CIF) has lodged its financial report for the year ended 30
June 2012 with the ASX. The second half results for both LBC
and Inexus were in line with expectations. Fund level
earnings for FY12 have been adversely impacted by movements
in the fair value of Inexus derivatives (A$132.8 million) and
the continued appreciation of the Australian dollar.
LBC's revenues were US$253.3 million for FY12, 4.9% higher
than the prior corresponding period. Earnings before
interest, tax and depreciation ("EBITDA") were US$99.6
million, 3.8% higher than FY11. The predominant contributors
to the growth in EBITDA were the US and French terminals.
Inexus revenues for FY12 were £69.4 million, 10% higher than
FY11. The company's EBITDA for FY12 was
£51.6 million, 8.6% higher than the prior corresponding
period. Inexus currently owns 647,334 utility connections in
the UK including 24,772 new connections from the roll out of
the order book during the year. Inexus is seeking an
extension in the repayment date of its existing debt
facilities to 30 November 2012 to provide Brookfield with the
opportunity to recapitalise and refinance the company.
Negotiations with the company's lenders and swap
providers on the extension are at an advanced stage. The
Board expect to make a further announcement regarding these
negotiations in the next few days.
The second half FY12 distribution of 5 cents per unit will be
paid to unit holders on 30 August 2012 in line with CIF's
previously announced estimate.
Over the last 12 months the Board and management completed a
strategic review initiated in August 2011. A binding sale
agreement was signed in respect of LBC on 4 June 2012. On 22
June 2012 CIF contracted to sell Inexus subject to a
favourable unit holder vote, which was received at a general
meeting of CIF held on
15 August 2012. Following the completion of both asset sales
it is the Board's intention to wind-up the fund and to
distribute the net sale proceeds received in two instalments.
The first wind-up distribution of A$1.29 is expected be paid
in October 20121. If CIF becomes entitled to the
contingent payment for the sale of Inexus, then the resulting
net proceeds are expected to be distributed by the end of
this calendar year.1
The completion of the sale of LBC is subject to merger
approval from the European Commission. The buyers have lodged
a final application and expect to receive a favourable
response in early September.
The completion of the sale of Inexus to Brookfield is now
only conditional on the minority shareholders in Inexus
exercising or waiving their pre-emptive right to match the
payment terms offered by Brookfield. Completion of a sale of
Inexus to either Brookfield or the minority shareholders if
they exercise their pre- emptive rights is expected to occur
in early October 2012.
CIF's chief executive Emil Pahljina will remain with the fund
until the completion of both asset sales, and thereafter has
agreed to oversee the wind up of CIF in a reduced capacity.
Michael Cole, Chair of CLIL said "Emil became the fund's
Chief Executive in March 2010 and has been instrumental in
successfully navigating the fund through an extremely
difficult and challenging period. On behalf of the Board we
would like to thank him for his efforts to date and also for
his willingness to commit to completing the task and seeing
the strategic review through to the very end."
1 Note these dates are subject to change depending on future events.
Further enquiry: Chantal Travers, Senior Manager, Investor Relations, Challenger Limited, 02 9994 7560Nicole Webb, Corporate Communications Associate, Challenger Limited, 02 9994 7806
Challenger Infrastructure Fund (CIF Investment Trust 1 ARSN 114 139 703 and CIF Investment Trust 2 ARSN 114 139 632) Responsible Entity Challenger Listed Investments Limited ABN 94 055 293 644 AFSL 236887
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