8th Fiscal Period Annual Report | Enex Infrastructure Investment Corporation

To Our Investors

We aim to create a society
considerate of the global environment
and realize enriched life for people through
investment in renewable energy.

Under the management philosophy of “aiming to create a society considerate of the global environment for realizing enriched life for people through investment in renewable energy,” Enex Infrastructure Investment Corporation (EII) conducts investment management of renewable energy power generation facilities centering on solar power generation facilities in an effort to realize a sustainable society based on social demand. By doing so, EII will provide numerous investors with better opportunities to invest in renewable energy.

Recognizing our social and public mission, we will strictly implement legal compliance and corporate governance while striving to build sound assets from a medium-term to long-term perspective through thorough emphasis on the actual place, actual matter and actual situation.

We appreciate your continued support and encouragement going forward.

Enex Infrastructure Investment Corporation
Executive Officer

Keiichi Matsuzuka

Acquisition of highly scarce mega solar

EII held public offerings for two consecutive years, and acquired Takasaki Solar Power Plant B, one of the largest mega-solar power plants in the Kanto region, where electricity demand is high.
The asset size reached the medium-to long-term target of ¥100 billion, making it the largest listed infrastructure fund.

Publication of Green Equity to Realize ESG Philosophy

EII issued Green Equity in accordance with the Green Finance Framework, which was formulated by reference to the Green Bond Principles and obtained a third-party valuation from JCR.

Japan Credit Rating Agency, Ltd.（JCR）

Green1（F）

Financial Highlights

Financial highlights for the 8th fiscal period ended November 2023

Distribution per unit

3,000 yen

Operating revenue

4,202 million
yen
Operating income

1,366 million
yen
Ordinary income

864 million
yen
Net income

863 million
yen
Total assets

109,707 million
yen
Net assets

45,088 million
yen
Net assets per unit

80,952 yen

Click here for Financial Highlights

Forecast distribution per unit

9th fiscal period ending May 2024

3,000 yen
10th fiscal period ending November 2024

3,000 yen

Click here for Distributions

Features of EII

Features of Enex Infrastructure Investment Corporation

Strong and Steadfast Sponsor Support

EII aims to expand the asset size steadily and create stable cash flows by investing in renewable energy power generation facilities, capitalizing on the wide-ranging support from the sponsors centering on Itochu Enex. In addition, EII aims to maximize unitholder value by providing opportunities to invest in renewable energy power generation facilities, which are strongly expected to expand as social infrastructure.

1

Sponsor Pipelines Providing a Variety of Asset Types

2

A Vertically Integrated Model of the Itochu Enex Group Consolidating All Business Units from Power Generation to Sales

The Group has established a business model that vertically integrates and consolidates all business units from development of sources of electricity to supply-demand management and sales, contributing to stable supply of electricity to customers and reduction of electricity charges.

3

Utilization of Resources of Sponsor Companies for EII’s Operations

EII believes that it can conduct stable operations after listing by utilizing the resources of the sponsors for EII’s operations and for operating and managing renewable energy power generation facilities.

Market research on renewable energy by Itochu Enex and Maiora
Sumitomo Mitsui Trust Bank’s operating know-how on J-REITs and expertise in financing and other financial transactions
Mercuria Investment’s know-how on appropriate information disclosure and highly transparent operations of investment corporations based on its proven track record of operating overseas listed REITs
Provision of personnel and operating support for the Asset Management Company (such as conducting training sessions for the Asset Management Company’s officers and employees, providing support for building the IT environment at EII and the Asset Management Company)

4

Stable Operation of Power Generation Facilities by ENEX Electric Power, the Operator

ENEX Electric Power has stably operated various power generation facilities and provided stable supply of energy since its establishment in 2002. It is an engineering group that provides quality services to customers and has a strong awareness of cost control. Taking advantage of the strengths of Enex Power, EII seeks to maximize the power generation performance of its solar power generation facilities in an effort to maintain and improve their revenue and asset value.

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Strong Pipeline Support

Major Assets for Investment

Solar power generation facilities

Investment ratio: 50 % or more (based on acquisition price)
Wind power generation facilities, hydroelectric power
generation facilities and others

Investment ratio: 50 % or less (based on acquisition price)

Various Pipelines Owned by Sponsors（as of November 30, 2023）

Number of pipeline
properties (Note 1)
8 properties
Total installed
capacity (Note 1)
25.3 MW

The number of pipeline properties and total installed capacity indicate the sum total of the power generation facilities, either in operation, under construction or being planned, which EII has not acquired.
The pipeline map above indicates only the facilities in operation.

Pipelines from secondary market

EII is also aiming to grow externally through proactive sourcing activities unique to the Asset Management Company. EII has obtained preferential negotiating rights for the purchase and sale of wind power plants (capacity 104.5MW) from a third party and will continue to seek to acquire wind power plants in the future.

Initiatives for Diversifying Sources of Electricity

Only listed infrastructure fund with wind and hydropower pipelines

We aim to build a more balanced portfolio by combining wind power generation facilities and hydroelectric power generation facilities, while continuing to expand the scale of our assets, mainly for solar power generation facilities.

Solar power generation
- Facility management is relatively easy
- Fluctuation in power generation is relatively low
- Night-time power generation is not possible
Wind power generation
- Night-time power generation is possible
- Power generation increases in winter
- Development period is long
- Advanced facility management know-how required
  
  ー
  
  Subsidiaries with know-how within the Enex Group
Hydroelectric power generation
- Night-time power generation is possible
- Power generation increases when the snow melts
- Selection of suitable locations is limited
- Clearing land titles and other issues is a complicated process

Sound Financial Management（as of November 30, 2023）

Reduce the risk of interest rate volatility by fixing a part of interest rates and stabilize the financial base by establishing commitment lines.

Lender Formation

Credit rating

Commitment Line

Maximum loan amount: ¥7 billion

Counterparty: Sumitomo Mitsui Trust Bank, Ltd.

Commitment period: Dec. 1, 2021 – Nov. 30, 2024

Corporate Loan (Mezzanine Loan)

Loan amount: ¥5 billion

Counterparty: Sumitomo Mitsui Trust Bank, Ltd.

Maturity Date: November 30, 2032

Click here for Financial Strategy

ESG Initiatives

Our basic principle:
We aim to contribute to the global environment and realize a sustainable society by promoting renewable energy, which is a low-carbon energy source.

Environment

Promotion and expansion of renewable energy
Contributing to the global environment and helping to bring about a sustainable society
Realizing a low-carbon society, resource conservation and a recycling-based society
Preserving local environments
Pursuing energy efficiency

Contribution to the global environment through investment in renewable energy

Social

Providing a stable supply of energy
Implementing work-style reforms and utilizing diverse human resources
Making a social contribution to local communities (Reconstruction assistance, volunteer activities)
Promoting lifestyle sustainability in local communities (responding to aging population)
Advancing value-added services

Response to the Act on Promotion of Women’s Participation and Advancement in the Workplace and Act on Advancement of Measures to Support Raising Next-Generation Children
Embracing diversity and cultivating the next generation of leaders

Governance

Compliance
Information disclosure toward the global market and transparency
Appropriate business management
Fulfilling corporate social responsibilities and ensuring compliance
Upholding industrial safety and health standards
Same-boat investments

Sponsor group’s investment
Proactive disclosure system, including in English

The chart above is a summary of the ESG initiatives of EII, the Asset Manager and the Enex Group, and includes items that are not directly related to EII or the Asset Manager.

Portfolio Overview

Portfolio Data（as of November 30, 2023）

Total Acquisition Price

102.2 billion yen
Total Power Plant Output

243.4 MW

By Region（based on acquisition price）

Portfolio List

Property No.	Property name	Location	Acquisition price (million yen)	Investment ratio (%)	Power plant output (kW)	Tariff (yen/kWh)
S-01	Takahagi Solar Power Plant	Hitachi-shi, Ibaraki	5,305	5.2	11,544.32	40
S-02	Chiyoda Kogen Solar Power Plant	Yamagata-gun, Hiroshima	590	0.6	1,595.28	40
S-03	JEN Hofu Solar Power Plant	Hofu-shi, Yamaguchi	680	0.7	1,940.64	36
S-04	JEN Kusu Solar Power Plant	Kusu-gun, Oita	324	0.3	1,007.76	40
S-05	Hokota Solar Power Plant	Hokota-shi, Ibaraki	11,444	11.2	24,195.62	36
S-06	Nagasaki Kinkai Solar Power Plant	Nagasaki-shi, Nagasaki	1,097	1.1	2,661.12	36
S-07	Matsusaka Solar Power Plant	Matsusaka-shi, Mie	40,241	39.4	98,003.40	32
S-08	Shinshiro Solar Power Plant	Shinshiro- shi, Aichi	465	0.5	1,540.00	40
S-09	Monbetsu Solar Power Plant	Monbetsu-shi, Hokkaido	6,654	6.5	15,704.64	40
S-10	Takasaki Solar Power Plant A	Takasaki-shi, Gunma	5,810	5.7	11,618.64	40
S-11	Takasaki Solar Power Plant B	Takasaki-shi, Gunma	25,211	24.7	53,679.10	32
W-01	Tainai Wind Power Plant	Tainai-shi, Nigata	4,379	4.3	20,000.00	22
Total			102,200	100.0	243,490.52	-

S-01

Takahagi Solar Power Plant

S-02

Chiyoda Kogen Solar Power Plant

S-03

JEN Hofu Solar Power Plant

S-04

JEN Kusu Solar Power Plant

S-05

Hokota Solar Power Plant

S-06

Nagasaki Kinkai Solar Power Plant

S-07

Matsusaka Solar Power Plant

S-08

Shinshiro Solar Power Plant

S-09

Monbetsu Solar Power Plant

S-10

Takasaki Solar Power Plant A

S-11

Takasaki Solar Power Plant B

W-01

Tainai Wind Power Plant

Unitholder Information

Invitation to EII’s Website

You can obtain the latest information on EII with your PC or smartphone.

EII works to prepare a variety of content on its website and endeavors on investor relations (IR) and information provision through the website in an effort to disclose information to investors in a timely manner and help them better understand EII.

EII’s Website

IR Calendar

Unitholder Composition

Number and ratio of investment units by investor type

Number and ratio of unitholders by investor type

Changes in Investment Unit Price

Topics

Growth strategy to realize diversified investment in diversified renewable energy

Realize further asset diversification

Since its listing in February 2019, EII has achieved steady external growth at an average annual pace of approximately ¥20 billion and improved stability in line with the expansion of asset size, achieving its medium-to long-term target of ¥100 billion, and has also made progress in asset diversification.
We aim to achieve asset size of ¥200 billion while realizing further asset diversification.

Realizing an advanced portfolio

We aim to grow an advanced portfolio that supports the regional renewable energy strategy together with our sponsors while meeting regional electricity demand (regional dispersion).

8th Fiscal PeriodAnnual Report