Half-year results for six months ended 30 June 2019

• High-quality investments continued to generate strong operational cash flows supporting both the payment of a 3.5 pence per share dividend¹ and a 2.2 pence increase in the net asset value ('NAV') per share to 150.3p per share.
• The Company's origination capability and use of pre-emption rights resulted in £200.5 million of additional accretive investments and commitments which have materially increased the portfolio's inflation-linkage and geographic diversification.
• An active approach to asset management and stewardship was consistently demonstrated by a refinancing and continued stakeholder engagement to support the portfolio's positive development.
• The predictability of long-term investment cash flows supported a strong dividend yield, with an average annual dividend growth of 2.5%, since IPO in 2006.
• Total Shareholder Return since IPO is now 170.8%, implying an average annualised growth rate of 8.2%.
• Over 1,400 hours of scheduled management meetings with public sector clients took place in the first six months of 2019, with the portfolio recording 99.9% asset availability.²

Financial Highlights³

• NAV per share growth to 150.3 pence (31 December 2018: 148.1 pence).
• Interim dividend increase to 3.59 pence per share (30 June 2018: 3.50 pence per share).
• IFRS profit before tax of £83.7 million (30 June 2018: £65.9 million).
• Enhanced inflation-linkage with projected increase in return of 0.86% p.a. for each 1% p.a. increase in inflation (31 December 2018: 0.82% p.a.).⁴
• Target 2019 and 2020 full-year dividends of 7.18 and 7.36 pence per share, respectively.
• Low correlation to the FTSE All Share Index of 0.18 and 0.17 over 12 months and 5 years, respectively.⁵
• H1 2019 cash dividend cover of 1.3x.⁶

Portfolio Update

In the first half of 2019, the Company continued to apply its proven long-term strategy of value-focused portfolio development, active asset management and efficient financial management to a portfolio of high quality, predictable, long-duration infrastructure assets which provide essential services to the public. This activity included:

Diligent management of the existing portfolio

• The Company undertook a refinancing of Blackburn Building Schools for Future ('BSF') project during the period and completed an additional refinancing of Ealing BSF in August 2019, which generated improved shared financial returns for both the portfolio and the respective local authorities. A combined £2 million was invested in Luton BSF and Wolverhampton BSF to increase the Company's ownership in each asset.
• In recapitalising the Midlands batch of the Priority Schools Building Programme in which the Company held a minority senior debt position, the Company committed to invest up to £12.4 million of risk capital to replace the project's existing equity investors and appointed a new contractor to allow the school's construction to complete and in turn, generate stable, predictable returns in line with the existing portfolio.

Selective exposure to stable, inflation-linked regulated assets

• As previously disclosed, the Company invested a further £153.2 million to reach its long-term target shareholding of 7.25% of Cadent, thereby giving it access to a permanent board seat as a platform to influence the business' long-term strategic direction.
• The Investment Adviser continued to support Cadent's engagement with Ofgem as part of the ongoing RIIO-2 consultation. The further investment into Cadent during the period has considerably enhanced the portfolio's inflation-linkage.
• Post-period end, the Company, as part of the Transmission Capital Partners consortium, was appointed as preferred bidder for the long-term license and operation of its eighth UK offshore transmission project. The Company expects to invest c.£35-45m in the transmission cable connection to the 400 MW Rampion Offshore Wind Farm located 13km off the Sussex coast. The Company takes no exposure to electricity production or price risk but is paid a pre-agreed, availability-based revenue stream over 20 years which is fully linked to UK inflation.

Continued global portfolio diversification

• The Company acquired an additional 51% shareholding in BeNEX, the German rail business with an accretive investment of £29.4 million⁷. The acquisition increases the Company's ownership to 100%, following its initial acquisition in 2007.
• BeNEX provides high-quality public transport to 12 of 16 German federal states and generates government-backed cash flows and geographic portfolio diversification for the Company, with limited exposure to passenger volumes and fare prices.

Early-mover into emerging core infrastructure asset classes

• The Company continued to originate a hard-to-access pipeline of UK digital infrastructure assets with £3.5 million of new co-investment via the National Digital Infrastructure Fund ('NDIF'). This included the full fibre UK broadband provider, toob.
• To date, the Company has invested £18.5 million out of the original £45 million commitment to NDIF. The assets in which NDIF invests generate long-term returns given the essential nature of broadband connectivity they provide to the home and the workplace.

Asset Stewardship⁸

The Company's investments continue to deliver sustained value to all stakeholders by supporting their public sector partners and the wider communities in which they operate. Owing to the Investment Adviser's active asset management approach, the Company delivered, among other things:

• 99.9% asset availability for those investments whose performance is measured by availability;
• 462 commissioned contract variations resulting in over £15 million of additional project work conducted on behalf of the commissioning body;
• Over 60,000 additional hours of asset availability dedicated to community use provided;
• Over 3,250 permanently employed staff across social infrastructure assets;
• Over 190,000 pupils at schools within the portfolio.

Outlook

The Company's operating environment is both active and diverse. Across the global markets in which the Company invests, policy and regulatory environments continue to endorse long-term investment of private capital into public infrastructure, which in turn supports the Company's healthy pipeline. While headwinds exist for the new nearer-term investment opportunities in the UK, the Company remains very positive about the long-term quality and strength of the existing portfolio in the UK. While the Company acknowledges possible market and other issues arising from anything other than an orderly Brexit, the Company is not unusually exposed to such risks and does not expect there will be significant impact on the portfolio or its assets' operation as a direct result. Irrespective, developments are monitored closely as the withdrawal process continues to evolve.

Michael Gerrard, Chairman of International Public Partnerships Limited, said: "As a result of the Company's robust portfolio performance, I am pleased to report another period of long-term, inflation-linked returns to our shareholders. Over a third of the Investment Adviser's employees are dedicated to asset management and our focus in the period remained on ensuring the availability of the assets we own. It is this differentiated approach to portfolio development which continued to generate significant direct and indirect value for the Company's shareholders, clients and end-users. The global outlook for infrastructure investment remains positive as the demand for the type of private capital we provide grows. The quality and resilience of our portfolio, combined with the future investment opportunities we are well-positioned to pursue, provides me with full confidence in the Company's future."  

Directorate Changes

As previously announced, John Whittle will be retiring from the Board of Directors (the 'Board') at the 2020 Annual General Meeting. John Stares is expected to retire from the Board during the course of 2020. Accordingly, the Board has commenced an externally facilitated selection process to identify two new Non-Executive Directors with suitably complementary skills and knowledge.

http://www.rns-pdf.londonstockexchange.com/rns/4328L_1-2019-9-5.pdf

INPP will be holding an analyst and investor presentation and conference call at 9.30am on the day of announcement (6 September 2019).

For those analysts or investors who cannot attend in person, a conference call facility will also be available by dialling +44 (0)330 336 9411 and using the confirmation code 6975335. Please note the conference call is not open to the media or their third party representatives.

A copy of the results presentation can be downloaded here.

Important Information

This announcement contains information that is inside information for the purposes of the Market Abuse Regulation (EU) No. 596/2014.

A copy of the Half-Yearly Report has been submitted to the National Storage Mechanism and will shortly be available for inspection at: http://www.morningstar.co.uk/uk/NSM.

This announcement is an advertisement. It does not constitute a prospectus relating to the Company and does not constitute, or form part of, any offer or invitation to sell or issue, or any solicitation of any offer to purchase or subscribe for, any shares in the Company in any jurisdiction nor shall it, or any part of it, or the fact of its distribution, form the basis of, or be relied on in connection with or act as any inducement to enter into, any contract therefor.

Forward-looking statements are subject to risks and uncertainties and accordingly the Company's actual future financial results and operational performance may differ materially from the results and performance expressed in, or implied by, the statements. These forward-looking statements speak only as at the date of this announcement. The Company, Amber and Numis Securities expressly disclaim any obligation or undertaking to update or revise any forward-looking statements contained herein to reflect actual results or any change in the assumptions, conditions or circumstances on which any such statements are based unless required to do so by the Financial Services and Markets Act 2000, the Prospectus Rules of the Financial Conduct Authority or other applicable laws, regulations or rules.

About International Public Partnerships ('INPP'):

INPP is a listed infrastructure investment company that invests in global public infrastructure projects and businesses, which meets societal and environmental needs, both now, and into the future.

INPP is a responsible, long-term investor in 130 infrastructure projects and businesses. The portfolio consists of utility and transmission, transport, education, health, justice and digital infrastructure projects and businesses, in the UK, Europe, Australia and North America.  INPP seeks to provide its shareholders with both a long-term yield and capital growth.

Amber Infrastructure Group ('Amber') is the Investment Adviser to INPP and consists over 125 staff who are responsible for the management of, advice on and origination of infrastructure investments.

Notes

^{1 For the 2018 second half year distribution paid on 10 June 2019.}

^{2 For those investments whose performance is measured by availability. Only applicable for projects where the Investment Adviser provides oversight of the management services.}

^{3 For the half-year ended 30 June 2019 unless otherwise stated.}

^{4 Projected increase in portfolio return for a 1.00% p.a. increase in the inflation rate assumed in the current valuation analysis for each asset in the portfolio.}

^{5 Correlation (R) from Bloomberg - 12 months and 5 years to 30 June 2019.}

^{6 Cash dividend payments to investors are paid from net operating cash flow before non-recurring operating costs as detailed.}

^{7 In addition, there is a deferred commitment of £18.9 million which is due to be settled from future returns generated by BeNEX.}

^{8 Metrics are estimates and exclude digital infrastructure, U.S. Military Housing, Brescia Hospital, Italy and construction projects (except Tideway). Where applicable, jobs referred to are employees of the Company's Facilities Management subcontractors and not of the Company or its subsidiaries.}