US Solar Fund has recorded an 11% drop in net asset value (NAV) to $284m, in its interim results for the period to 30 June 2023, compared with a NAV of $320m in the period ending 31 December 2022.
Macroeconomic headwinds impacted the infrastructure sector as US inflation increased operating costs and discount rates increased.
Combined, these factors more than offset improved merchant curves for US Solar Fund’s operating portfolio.
Gill Nott, chair of US Solar Fund, said: “The company has faced challenging market conditions over the first six-months of this year as the macroeconomic environment has become more volatile.
“We are pleased that the portfolio has performed well, confirming the attributes commonly associated with long term, contracted real assets.
“However, a variety of market related factors has impacted the valuation of the assets and the Board’s ability to respond to some of our shareholder’s wishes during the period.
“The most significant changes to the market relate to the current interest rate environment, inflation and legislative changes affecting the solar industry in the US.
“As a result, and as previously announced, the Strategic Review was unsuccessful in attracting binding offers for the assets or company.
“We have worked with our advisors and shareholders throughout the first six-months of this year to adapt our strategy to the current and unexpected market conditions and are now laying the groundwork necessary to move on from the Strategic Review and build confidence around the future of the company and the portfolio.”