Infinis Energy (LSE: INFI), the renewable energy firm chaired by the former SSE boss Ian Merchant, saw revenues increase by 7.3% in 2014 on strong performance from its landfill gas and wind businesses.
Strong revenue growth and a focus on cost control boosted earnings before exceptional items by £148m from £125m a year earlier. The Northampton based firm has strengthened its balance sheet and the leverage ratio fell to 3.7 times from 4.4 times a year earlier.
As for outlook, there are no shortage of risk factors, from unfavourable weather to a challenging political backdrop. However, the firm’s strong cash generative nature means that the board is confident the stated dividend policy can be delivered without compromising growth plans.
The chief executive, Eric Machiels, commented:
“We are pleased with the performance of the Group during its first months since listing and look forward to further delivery against our targets in the current year.”
In the week leading to today’s results the shares rose by 16p, or 8%, to 227p. Infinis posted a final dividend of 6.6p per share and is committed to paying a full year dividend of £55m (18.3p) for the coming year. Based on the present share price, which values the company at £682m, the prospective yield on a purchase in Infinis could be 8%.
Of course, no dividend is a guarantee, and the decision to ‘buy’ remains up to you.