Corporate
Announcements prior to September 2017, including this announcement, occurred under previous ownership.
24 June 2014
2013-14 Results
The UK Green Investment Bank plc (GIB) today reports its performance for the financial year to 31st March 2014:
With only 18 months of activity so far, the majority of GIB’s investments (88% by value) remain in construction and, in line with standard accounting practice, a significant proportion of income is deferred to future years. As a consequence and in line with expectations, GIB recorded an operating loss of £5.7m in the current year. GIB is on track to reach sustained profitability once its current portfolio is built and operating.
UK Green Investment Bank Offshore Wind Fund
GIB also announces plans to launch a £1 billion fund to acquire equity stakes in operational offshore wind projects in the UK. GIB is seeking a suitable group of strategic, long-term co-investors to participate in this innovative capital raising exercise. The Fund will be managed by a GIB subsidiary which is currently regulated by the Financial Conduct Authority (FCA) and will be seeking permission from the FCA to become a regulated fund manager.
This is an important development for the UK’s offshore wind sector. With 3.6 GW of installed capacity, 1.4 GW in construction and a number of further projects in the pipeline, the UK sector is set to grow significantly in the coming years. To support that growth, it is vital that developers – typically large utilities – are able to refinance part of their investments in operating assets to reinvest in new developments. This requires a significant broadening of the number of long-term investors in UK offshore wind projects. Equity investments in operational wind farms can offer a compelling opportunity for investors seeking long-term, inflation-linked returns. These attributes can be well matched to the needs of long-term infrastructure investors such as sovereign wealth funds and pension funds. In May 2014 GIB received State Aid approval from the European Commission to promote and manage funds and other co-investment structures for mobilising upfront private sector investment into its designated sectors.
This widening of GIB’s activities is a significant strategic development as it will enable GIB to promote and manage funds and all other types of structured co-investments within any of its designated green sectors, allowing it to raise and deploy private sector capital in addition to its current £3.8bn of equity funding from the UK Government. GIB is targeting a first close on the Fund by the end of the calendar year.
Lord Smith of Kelvin
Chair of the Green Investment Bank
Shaun Kingsbury
Chief Executive
Vince Cable
Business Secretary
Further details of GIB’s results will be set out in the organisation’s Annual Report, which will be presented at two annual review meetings in London (25 June) and Edinburgh (26 June), where Lord Smith of Kelvin and Shaun Kingsbury will explain the bank’s performance and future strategy to a wide range of stakeholders.
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