Greencoat UK Wind PLC (UKW) Earnings Call Transcript & Summary

Hello, and welcome to the Greencoat UK Wind Analyst and Investor Presentation. My name is Terry, and I'll be the conference operator today. [Operator Instructions] I would now like to turn the call over to Stephen Lilley and Matt Ridley from Greencoat UK Wind. Please go ahead.

Thank you. Good morning. Thank you very much for the introduction, Terry. Good morning and welcome to what is, I think, the 12th half year results presentation we've done. A lovely photograph of Braes of Doune on the front of this presentation. If you know that part of Scotland, beautiful as it is. Well, you probably should work out to the right of the photograph. You can see Stirling Castle. Another way of looking at it is -- or thinking about it is as you drive around the M9, it's out on the hillside on the left-hand side. Anyway, just for information. Carrying on into the presentation, we've had what we'll probably describe as a sort of slightly uneventful first half, resilient. We've had lower production predominantly from 2 things, a little bit lower wind volume and some availability issues, notably Hornsea 1, which we'll talk about as we go through the presentation. Despite all of that, still 1.5x covered, so strong performance, just shows us the resilience in the structure of the business. NAV is slightly down in the half. What you sort of see from the beginning to the end is that short, medium-term price is pretty much steady. They did actually go down in the interim and come back. But the NAV slightly down really comes from the back end of the power curve, which we'll talk about later on as well. Debt, you can see there's 39% GAV. Still, we've got a refinancing in process at the moment at advanced stages to refinance that RCF but also to some of the other term debt that's coming through. So it's all pretty straightforward and a good appetite for us to take a UKW credit. Dividends increased this year again with -- more than RPI of 14.2% versus RPI of 5%. That's just the promise, I guess, to investors to always increase the RPI, and we've done that obviously a bit more than that. Alongside that, in terms of dividends paid, this is really sort of cash, we've paid GBP 136 million worth of dividends in H1, but GBP 29 million were effectively for topping up 2023. And that was really part of the capital allocation process that we wanted to sort of go through, not just the share buybacks at GBP 53 million since October but also the GBP 29 million of top-up for the dividend. So that's GBP 82 million extra on top of the dividend that we have continually paid. In addition, I guess going forward, we have an expectation of over GBP 1 billion worth of excess cash generation to do things with, if you like. We've got obviously buybacks that we're progressing at the moment. We probably sort of think about adding from selective disposals to that. So it's a big war chest which can do various things within -- in the short-term, obviously to pay down the RCF and possibly more buybacks, et cetera, et cetera. But let's see where shares trade going forward. In terms of the more strategic things, I guess, NAV has increased in line with RPI, 4% more than that over the last 11.5 years. Shareholder return still at NAV 10%, where we're trading at the moment, probably a bit more than that. And that sort of return point is sort of kind of important. Yes, we might be trading at a 7% dividend yield, but obviously the reinvestment is pretty crucial there, and the return is everything. Another theme, I guess, which has started to emerge over the last probably fortnight, not too surprising, and it's probably been emerging -- you probably could have worked it out for quite a long time before that given the likelihood of a Labour victory at the election, is the increase -- an ambition and the target of the new government into this area. Labour has always been more green focused, if you like, than the Conservatives. And I think for us, it gives potentially a huge opportunity going forward, and we'll touch base on that in a couple of slides' time. But you see doubling of onshore, quadrupling of offshore. That's quite a big task. Wind is going to be the heavy lifter of this. And we, given the size that we are nearly in the FTSE 100, are obviously a really crucial part to that story. What was the case at IPO? We set up to address a variety of needs, and investor -- from an investor perspective, a dividend with RPI linkage. So that -- we obviously proved that 11 times now, but also NAV preservation and also access to own assets through a vehicle like ours. So that's from an investor perspective. Obviously, as you go into massive increase in capacity, the need to recycle capital is probably even more important than it was 11 years ago. And actually, most of that is obviously to meet societal need to get towards net zero. So those 3 components that were hugely important on listing in 11 years, probably even more important than they were, I think that's where we sort of see some of the development in terms of where Labour wanted to get to. If you look at this -- I'll pick some numbers out of here. We were expecting market to increase from GBP 100 billion to GBP 175 billion over the next 6 years. That's a lot. If you then add on the -- to the chart bottom left, the crosshatch increase in onshore and offshore, we see that going up to nearly triple, from GBP 100 billion to GBP 275 billion. That's a massive increase. And actually, if you go to the top chart on the left, you can see a lot of that heavy lifting gets done by the AR7, AR8 rounds, 27 gigawatts of capacity. That is absolutely massive. And even if Labour managed to achieve half of that, it is still an enormous build. We being the fifth largest owner of wind capacity in the U.K., with 4 above us all utilities. So we're the premier recycler, if you like. We're the fifth largest owner. Hugely important position that we hold in that market. And also, not just as UK Wind, but as -- with the private capital, it shows that Greencoat manages to come alongside that. We can shift huge volumes of capital that become extremely helpful, if you went back to the previous slide, to the utilities who need to recycle and build. So we're a key part of this ecosystem, which has become almost even more relevant over the last fortnight. In simple terms, we continue to, on a per share basis, pay a dividend that increases with our preserved NAV on a real basis. You can see that from the numbers at the bottom, GBP 1 billion of total dividends paid. And then, it's probably undeclared, I think, on that, probably missing that chart. But -- and then in terms of GBP 935 million of reinvestment. So just keep going around that cycle. Remember, we can't raise equity, and therefore, we haven't got the use of debt and the equity. So that sort of switched off a little bit at the moment. But I'd imagine over the longer term, as we get into more normal markets, that will be relevant again. But that's how we produce power, we produce cash, pay a dividend and reinvest. At the moment, reinvestment is done effectively into buying back shares and also paying down debt. Let's skip through that. Let's see how the numbers sort of get added up. You can sort of see that, but I guess 1.5 for the period, 1.9 in total. If Hornsea 1 was effectively corrected, if you like, we'd still be at 1.7, which is pretty sort of normal for us. And we'll sort of come on to Hornsea 1 later on in the presentation. Same chart as year-end because, guess what, we haven't bought anything. So 49 wind farms, we produce power for 2.3 million homes. We avoid 2.5 million tonnes of CO2 per year, and that's done across the 49 wind farms across the sort of territories and geographies and asset lives and several manufacturers and et cetera, et cetera. Note on this chart, I guess, Hornsea 1 at 16%, yes, you will see the significance of that as we go forward. So I'm going to hand it over to Matt, and then we'll -- I'll pick up later on the presentation.

Thanks, Steve. I'll run through the net asset value movement over the half year and then some of the key themes Steve has mentioned already. So probably the easiest way to look at NAV movement over time is just to focus to the chart on the bottom left of this slide. If you look at the movement between the 2 gray bars on the left, that's effectively us turning the handle on the model. And as Steve said, you can see at the front there, 1.5x dividend cover for our regular dividend. The additional dividend that we paid for last year, the GBP 28.6 million, that took 2023 up to 10p per share and then net depreciation over the period, which is relatively low. The middle of stack is effectively capital allocation. This time around, that's almost a one-dimensional story, really, around buying back shares, so GBP 44.3 million spent in the period on shares. And the next section between the 2 light green bars is effectively assumption moves. As you can see from the narrative on this chart, there's a lot of things that are pretty much unchanged. CPI, RPI and discount rate assumptions still providing that 11% levered portfolio IRR. But there is a movement in the longer-term power curve, and we'll come on to address power prices a bit later, as well as some of the developments in terms of responsive demand that, I think, are helpful in terms of [indiscernible]. Moving on to the next slide, this just breaks down the cash flow for you. As we said before, you can see the net cash generation at the top, dividends paid. That GBP 136 million, of course, includes the additional dividend from last year. Leaving the recurring dividend cover of 1.5, subtracting that out, that's the GBP 165 million over the GBP 107 million. So as Steve said, resilient dividend cover of 1.5x despite some availability challenges that we'll click on in a second. Moving on to power prices. Clearly what we like to do here is disclose, tell you a lot about power prices, how they move and what happens to dividend cover on a range of sensitivities. Power price on our representative PPA curve is still trending down towards GBP 45 per megawatt hour in the long run. If we look at our portfolio cash flows on a DCF basis, we retain the 50-50 fixed versus merchant. That's effectively as was at the end of last year. And we have around 60% of our cash flow fixed over the next 3 years. That, of course, provides some resilience to movements in power prices in terms of dividend cover. And you can see that when you look at the dividend cover table here, we deliberately include some cases here that are aggressively low power prices, if you like. The point being that with the fixed cash flows that we have, even down to a price of GBP 30 or GBP 20 a megawatt hour, we've more than covered the dividend on an illustrative look-forward basis. And this really underpins our view, which hasn't changed. The power price risk is taken judiciously. It's an asymmetric upside for the fund. You can see the downsides. They're there. They're published. And if you think about what happened in '22 and '23, where dividend cover was very, very good, you can see what happens if you do clip those higher power prices. Another important part of this, I think, and it's increasingly coming to the fore, is a big increase in responsive demand, particularly for green electrons. So what we mean by responsive demand is anything that's smart that can respond to a price signal. And that might sound like it's desperately complicated and hard to fathom, but actually, if you think about it at home, it's relatively simple. As we roll out smart meters, more and more people at home can have access to half-hourly electricity pricing. You can also get a deal from your energy supplier to give you access to that. So in effect, if you can control when you draw your electrons, you can monetize the price that may or may not be attractive to you. You can do that with an electric vehicle. You can allow an algorithm to charge it for you overnight. You don't really care which half an hour it charges in. You just care [ if you get ] at 80% at 7:00 a.m. in the morning when you take the kids to school, for example. Maybe a bigger scale of that in the future version is green hydrogen production through electrolysis. So that's effectively electrifying the emissions that would otherwise go into producing hydrogen. That can also be relatively responsive in that there's an ability to store green hydrogen. Home heating, I think, is another one that will come to the fore over time, particularly with some of the Labour policy commitments to heat pumps at homes. And increasingly, everyone will have seen a big use in the -- a big increase in the use of AI. That will call for more data center capacity. The data center providers want to do that through green electrons. That's their commitment. So you think of an Apple, a Microsoft, an Amazon, for example, they want green electrons. They have their own commitments to net zero. The overall of this is that, in essence, in the short run, even in the next 5 years, there's a pretty material increase in demand from these sources. So around 30 terawatt hours of new electrical demand by 2030. That's about 10% of the U.K.'s current electrical supply. It's about 5x UK Wind's generating capacity over a year. So it's pretty material. And if you start to look out at some of the future energy scenarios published last week, that could even be 50% increase in electrical demand in the next 10 years. So it's relatively material. I think that does 2 things for us. If you have responsive demand, that can moderate periods of low power prices because there's effectively a takeover. If the price gets attractive enough, they can take it. And I think over the longer term, it broadens even further the options that we have for power price contracting. Moving on to portfolio generation. For those that want a deeper dive on wind and how we view that and what we do as a matter of assessment, measurement, calibration and asset management, there's plenty of materials in our Capital Markets Day pack. That was on the 1st of May. You can even, if you like, watch the video, where you'll see a bunch of us presenting on these subjects. The story of the first half of the year, 15% below budget. Actually, a material part of that was really availability. So that is the availability of our own machines to generate. Clearly, it doesn't matter what the wind's doing if you can't generate because your machines are unavailable. And not all lack of availability is evenly distributed. If you have an asset that's a relatively large part of the book, Hornsea 1, for example, and that has an issue, which I'll describe in a second, it also happens to have a relatively high CFD price, so a relatively high net pounds per megawatt hour to us as shareholders. You can have a pretty significant issue from one single asset. And here, as we said before, as Steve flagged, if we had not had this issue in the half, we would have had an additional 0.2x of dividend cover. So back to the business case of 1.7x. So what happened is that there was a cable fault in mid-January. We flagged this. We mentioned it in our Q1 disclosures. One of the 4 -- one of the 3 400-megawatt circuits was off-line 6 weeks. That has a material impact, particularly in the wintry months, where wind generation is higher than in the summer. And then there was a need for proactive works to correct effectively a similar issue on the other 2 circuits. All of that led to full production not being restored until the 2nd of June. It is now back up and running. We will issue a business interruption claim. We won't say very much more about that here. But you can see that the impact this can have from a single asset on dividend cover, 0.2x. Just moving on to debt. Again, there's a wealth of material on this in our Capital Markets Day presentation. There's plenty there for you to look at if you'd like to understand about more about how we approach debt, how we structure it, what we think the right financing approach is for a business of this nature. Small reduction in absolute pounds of debt over the period, principally because of a GBP 41 million repayment of our only SPV-level amortizing debt, Hornsea 1. That will continue to reduce by approximately GBP 50 million per year going forward. As Steve mentioned that we have refinancing on the agenda. Again, approach to that largely well set out in the Capital Markets Day. We're at a very advanced stage. We've got a very supportive lender group, which is good to know. There's a lot of places they could put their money, and UK Wind perhaps is one of the top destinations. So there's lots of appetite. The range of maturities, I think, will end up proving relatively attractive, including potentially extensions to the early 2030s. We were often asked, what happens as your cash flow gets more and more merchant? Can you continue to refinance term debts? And I think we'll prove when we announced this that the answer is yes. So we will give the market a full update on completion of that refinancing with the context of what we've done, the chosen form and structure of debt and how that sits in the context of the business. I'll hand back to Steve now to go into portfolio returns.

Thank you. I mean the interesting thing, I guess, linking them between this and the next slide is debt, for us, is value accretive. The cost of debt for us is not high in comparison to the return on the business. So actually, we like using debt and not scared of doing so. If you look at the portfolio return on this slide, you can sort of see the -- at -- even at NAV, we're 6% north of the 10-year gilt. Where we're trading at the moment, obviously more than that. So actually, the return versus the cost of debt is obviously significantly different, and therefore, NAV is -- debt is accretive to us. Ultimately, we can choose what we pay out in terms of dividend and we reinvest. And therefore, the return on the business is everything. It's all about the IRR. And that's, I think, for us, especially slightly frustrated that we're still trading at a discount. We don't think it's much to do with NAV and not much to do with value in some ways. It's probably more to do with the fact that we've got multi-asset selling going on and with us being the most liquid stock in the sector, I guess where they come. So I think for us, we're not too surprised in one sense. But once we start getting inflows into the U.K. market, which I think we start to see, we should be the first one to benefit from that because ultimately value return, which is obviously what value is all about, is really, really solid. And you can sort of see that on this chart. We have taken discount rates, and we have taken that above pre-IPO levels effectively. The return on that business versus the risk-free rate is good. It's high. In terms of our capital allocation, obviously we talked earlier on about GBP 1 billion worth of excess cash flow potentially coming through in forecast. We've got many things we could do with that. Obviously, we've started off paying GBP 82 million worth of extra dividend and also buying back shares. We've talked about that. We've also increased the dividend by more than RPI, substantially more than RPI. So those are sort of the 2 things in terms of sort of the near-term things we can do. Then we will look at acquisitions in the longer term. I guess they will always be graded against buybacks in the shorter term, but the focus more is in terms of disposals. We don't want to say too much more than that, not more because we don't want to be held hostage to fortune. There's plenty of opportunities for us to do that, and we'll continue looking at that in a very positive way, and we'll expect to be able to do something on that. In terms of debt repayment, naturally that would just follow if we're not doing any others because every time we get money in, it will pay down the RCF effectively. And you can sort of see there's 4 options that we'll continue to do with the big excess cash flow that comes through. In terms of ESG, this is really sort of an advert, I guess, go and look at the ESG report. It's fantastic. We published it in May, reaffirms all the stuff that we're doing sort of more generally in terms of the commitment that we as Greencoat have in terms of net-zero asset management initiatives, carbon footprint management, et cetera, trying to reduce Scope 1, Scope 2 by 2030 by 50%. All the sort of commitment towards stewardship and habitat management plans and all those sort of things are really, really obvious for us as a business, but we do more than required, a real focus for us as a business. In terms of social, health and safety, which I'm responsible across the whole firm, but specifically for UK Wind, hugely important. We do a lot of work making sure that we don't hurt people effectively, which is obviously the most important thing for us is that people come to work and go home in the same state they were when they came. So that's obviously hugely important to us and a key focus and also for the Board who -- we have Jim Smith. He's Head of SSE's renewable business, hugely impressive operator and very much focused on that as well. And community funding, we do that. We do a bit extra to what we have to do in terms of planning. So that's a good thing for us to do. And then governance. We -- with the UK Wind Board, deep expertise and a great help for us. Sometimes too much help, but -- only joking. In terms of summary, again, cash resilience is pretty important, 1.5 covered even with some fun, if you like, on availability and slightly lower wind. Big cash generation, 1.5 covered. NAV down slightly, really towards the back end, as Matt talked about. Refinancing in advanced stages, so that should be fine. And then in terms of dividends, we've increased the dividends a bit more than RPI but also paid extra cash in the half for last year combined with the GBP 52 million of buybacks, an additional GBP 82 million back to investors, big coverage going forward, likely disposals. And then we -- following the other part of the strategy, I guess the proposal of an increasing dividend with RPI is real NAV preservation. We've done that, obviously. Return to investors is high. And we're more relevant now than we were at listing. Laurence and I, 11 years ago -- 11.5 years ago, with a government that -- we're going to be right in the crossroads, right in the middle of it. And really exciting times for us. I'm going to stop waffling at that point and get to questions if there are any. Thank you for listening so far.

[Operator Instructions] The first question on the line comes from Alexander Wheeler of RBC.

Two from me, please. Steve, just building on your point on paying down the RCF, how should we think about the potential decision to pay down the RCF with any disposal proceeds that may occur? And is that now more of a priority? And I suppose as you mentioned in your presentation, you're in a good position relative to most in the sector given your high return relative to the cost of debt. So I'd be interested in getting your thoughts there. And then my second question is just on -- clearly, as you mentioned, again, an important part of the market. We've got a new government and obviously, in your presentation, highlighting a significant investable market going forward. Are there any changes that you'd like to see from the new government from a UK Wind perspective that you think would be materially helpful to getting that moving and accelerating further?

Thank you. Matt, deal with the second one. I'm sure he'll cover cost disclosure. On the first one, I guess, paying down the RCF, well, first of all, you're right. We're in a good position. The return is high, so we actually don't mind having debt even at 39%. It doesn't threaten, as you can sort of see, dividend cover. We're in a good place, so we're not uncomfortable about that. I think naturally, just as cash comes in, naturally we pay down the RCF, unless we're doing other things with the cash, like buying back shares, et cetera, but -- so naturally it would happen. In the medium to long term, we want to have the opportunity to be able to be part of this massive build-out. So we do want to buy assets in the medium to long term. That isn't something we can do at the moment. It's not the right thing to do with cash at the moment. But paying down the RCF over the next period, I guess, puts us in the position to better do that, should we get to a place where we can issue shares again. But we can't do that at the moment, so I've given you half an answer there. I guess it's managing the balance sheet probably as much as anything else, albeit we don't mind having a 39% leverage because it's good for the return. In terms of the government, what do the government want to do?

Would you like a long wish list? I think probably the first thing to focus on is what we have felt and heard so far, and then to maybe figure out what the ask might be. I think, look, as Steve has said, there's a very strong supportive message in the direction of net zero and an acceleration to 2030. That just simply requires a huge build-out of wind, onshore and offshore. It's good to see immediate policy action in that direction and that the de facto moratorium on developing wind farms in England has already been overturned, so there's immediate policy action. I don't think that's hugely necessarily transformative for us as a business, but as a measure of policy commitments and action, I think it's a good statement. It's also good to have a relatively stable environment where you have domain experts in cabinet positions and ministerial positions. That can only be helpful. I think what we really need to see is a strong level of support in allocation round 6, 7 and 8. As Steve said, 7 and 8 are going to have to deliver something like 27 gigawatts if you're to get to the roughly 60 gigawatts of wind that you need to get to net zero. So that's a very material amount. And I think a lot will have to be done to underpin that to bring forward projects. If I were to have an ask, it's actually really not about energy policy, actually. It's really just about cost disclosure and the rules that seemingly continue to penalize retail investors, particularly those that are advised from investing in UK Wind versus investing in other similar businesses where the read-across for total expense ratio is 0, even though they, of course, have embedded management costs. That was making, I think, quite good progress through Parliament until the surprise, I mean, to many, not perhaps to a few Conservative insiders, but the surprise of the election. It basically was one of the things that was lost in purdah, didn't make it through, is now being revised. We'd very much like to see progress on that. We view ourselves as an essential spigot in directing capital towards net zero. If there's no one to buy these projects, no one's going to build them. Utility and development balance sheets are only finite. You've seen that there's an expansion in the opportunity of, say, GBP 275 billion. That's a lot of capital. You need all of your spigots of capital working properly. And correcting this, which is a broader investment trust issue, I think, can only be helpful for that.

Just to give you a -- just adding on to that, just to give you a feel, Great British Energy, obviously, been in the headlines. GBP 8 billion mark in terms of cash versus GBP 175 billion. You needed the cash, not just GBE. It would be helpful, and it's a good sign, but it doesn't really sort of do too much.

The next question comes from Iain Scouller of Stifel.

I've got 3, if I may. Firstly, dividend cover, what is your projection for full year '24? I see you've got quite a useful matrix for sort of '25 onwards based power price. That's pretty helpful. The second one is just on the cash generation. I mean that's down from GBP 204 million over the same period last year to GBP 165 million. Can you just give us a bit of a breakdown on that? I mean how much was related to the outage? How much is related to lower wind speeds and lower generation? And then how much is related to the lower power price? And then the third one is just on these sort of potential sales. I mean you were talking about that at the start of the year. Looking at the statement today, it doesn't look as though that's actually sort of moved on to any great extent. But can you just give us an indication on sort of potential size, stage it's at and sort of potential timing when we actually see some cash coming in from that?

Thank you. In terms of the last one -- and then Matt will deal with the first 2. We can't obviously announce something because we haven't done it yet. You will see, and we're trying to signal, to some extent, without saying anything because process takes time. We are a big business, so we would anticipate a big movement, much bigger than we've sort of seen elsewhere, unless it takes some time to do that. We have a very big balance sheet over GBP 6 billion, so it is something that we would hopefully do relatively soon. We can't really give you any other indication than that. You'll see in things like the Chairman's statement and in our RNSs, it's further towards the top than it was previously, and we're trying to give you some signal there without actually being very specific because we can't.

So on a -- thanks for your question, Iain. On dividend cover for the year, we expect it to be at or around the same level. The reason for that is that past performance bleeds into future cash, right? So you know what our performance was in the first half of the year. And then when you think about when you receive some of the ROCs, when you receive settlement under some of your PPAs, that cash flow, which is what we measure in dividend cover when it actually arrives in the bank account, bleeds into the next period. So I think that is the guidance we've given. That's on one of our slides as well. When it comes to cash generation, we haven't really ever provided a full breakdown and bridge, but the material factors are the ones that we've spoken about. A little bit of wind, frankly, not as significant as in the past. The biggest material issue is Hornsea 1. So if you think of that as 0.2x on dividend cover, you can do the math there and work out how much that is in terms of millions of pounds. So call it approximately GBP 20 million, for example, 0.2x of dividend cover. And whilst we say rightly that power prices for 2024 are relatively unchanged versus December, it's actually the experiential power price during the first half of the year that matters. So power prices did fall at the front end. And that materialized particularly in a pretty high-generation period for us, which was April. So there's also a contribution from lower experienced power prices during the first half of the year. Just to point out, though, that the capture discounts that we experienced over that period was 11%, so that's squarely within our 10% to 20% range, so it's less about capture and more about the actual power price itself.

[Operator Instructions] The next question on the line comes from Conor Finn of Barclays.

Two from me as well. So firstly, can you maybe quantify on the underperformance versus budget? How much of that was down to Hornsea 1 in terms of the generation side? And then secondly on the latest curve, what's driven the decline in the longer-term forecast? Is that primarily down to higher build-out assumptions? Or is there any other factors at play as well?

So Matt, why don't you take the second one? In terms of the first one, I'm pretty sure it's written, isn't it? 5% comes from Hornsea 1. So if you look at -- and why it's so significant, I guess, is that Hornsea 1 is, as I tried to point out, as we went through, 16% of the business. It's also got -- and some of that is because obviously a very high CFD price. So if it is off for a period of time, which it was, it was a reduced capacity. Therefore, it's obviously going to have some hit into the business strength. So it's a thing of history, if you like. We do obviously, across the whole business, have an allowance in there for downtime, so some of that will be the use of this, but there's obviously a significant point for that. You can mitigate it, which obviously we did, so if you've got an offshore site, you'll have more than one transmission cable back to shore, so you will reconfigure the site and you take quite a lot of capacity still off, but you can't get full power because you don't have, obviously, enough by the 2 other cables to take full power, but you do have some loss. Hopefully get some of that back through the business interruption insurance, but we probably won't get all of that back through BI cover. In terms of the back end of the curve, Matt?

You're right, Conor. Really, it's a mix of build-out rates and gas prices over the long term. This is a minor factor of -- as you'll see in the charts now rebased to 2023 money, it's a function of all those things.

We currently have no further questions, so I'll hand back to Stephen Lilley for any further remarks.

Thank you. Thank you for being on this morning. In one sense, this is -- not all has happened, which is kind of a good thing, isn't it? We're an infrastructure investment. We're resilient. Cash generation has been slightly down for the things that we've talked about, slightly lower wind and slightly lower production availability effectively, but still 1.5 covered. And we paid GBP 82 million in addition to a dividend that's increased by more than RPI. We've paid nearly GBP 1 billion -- or over GBP 1 billion in dividends and reinvested nearly GBP 1 billion as well. So that return, as we sort of kept talking about, hugely important. In the context, I guess, of a new government that wants to turbocharge this sector, and we're the fifth biggest owner of assets in that and the first co-invest partner with all the utilities above effectively as we get that build-out towards net zero. So we're in a really good place. We feel very comfortable where we're at. But we're not trading at a premium at the moment. We think we should be because of the return of the investments, but as we're not, we'll continue doing the things that we should do in that environment, which is buying back shares, taking the RCF down, et cetera, et cetera, and be good managers of people's money while that's the case. But while that is the current and the short-term opportunities or activities, the longer-term opportunities for us are immense as you look at the build-out that's required. So we feel very positive where we're at. We'll continue doing the stuff we're doing now and look forward to the future. Thank you very much for your time this morning. Much appreciated from Matt and my perspective. Look forward to seeing some of you in person over the next few days and weeks. Thank you.

Thank you.

This concludes today's conference call. Thank you all for joining. You may now disconnect your lines.