Good afternoon, and welcome to the International Public Partnerships Investor Presentation. Throughout this recorded presentation, investors will be in listen-only mode. Questions are encouraged and can be submitted at any time by the Q&A tab situated in the right-hand corner of your screen. Just simply type in your questions and press Send. The company may not be in a position to answer every question it receives during the meeting itself. However, the company can review all the questions submitted today and publish responses where it is appropriate to do so. Before we begin, I'd like to submit the following poll. I'd now like to hand you over to Amy Edwards from Amber. Good afternoon.
Hi. Welcome, everyone, to the International Public Partnerships results presentation for the six months to thirtieth of June, twenty twenty-four. Good afternoon, and thank you for joining us today. I'm Amy Edwards and work in the investor relations team at Amber Infrastructure, the investment advisor to International Public Partnerships. Joining me today to present the detail of the presentation is Chris Morgan, senior investment director at Amber, and who has responsibility for INPP. Also joining him is Dan Watson, Amber's head of ESG. As you'll hear from Chris, INPP has continued to perform well during the period, delivering consistent financial returns despite the volatile macroeconomic environment. At the end of the presentation, we will be happy to take you through Q&A from the audience. Please register your questions through the Q&A function.
Finally, before we start, as a reminder, this presentation is intended for a U.K. retail audience, and I would like to draw your attention to the important legal information on the screen. With that said, I will now hand over to Chris to take you through the detail of the twenty twenty-four interim result.
Thanks, Amy, and good afternoon, everyone. Thank you so much for joining. Now, just before we get stuck into the results for the period, I just want to spend a moment talking about our approach and the resulting current investment case, so we seek to maintain a diversified portfolio of low-risk, essential public infrastructure assets that we actively manage to generate consistent and predictable returns for investors, as well as environmental or social benefits for individuals or communities that rely on our assets as part of their daily lives. The predictability and consistency of the cash flows from the underlying assets is really underpinned by a few factors, and that's that the revenues are, for the most part, availability-based or regulated. The revenues are paid to us by government or government-backed entities. The revenues have a high degree of contractual inflation indexation.
Finally, we adopt very robust capital structures within all of our projects and businesses. We then reduce risk by ensuring the portfolio is well diversified, and that's from a geographic perspective, a sectoral perspective, as well as the counterparties that we use on our assets. Fundamentally, all of the assets are very similar in the sense that they continue to support the delivery of essential public services. Within Amber Infrastructure, the investment advisor, we have an asset management team in-house that has presence across all the geographies in which INPP is invested. That team has a really strong understanding of the assets and very positive relationships with stakeholders.
I think having that team in-house has delivered very real, significant, tangible benefits to INPP over the years and is still a key differentiator within the industry and is a real sort of demonstration as to the importance that the company places on actively and closely managing its critical infrastructure assets. Our commitment to being a responsible investor is demonstrated by our alignment to various different sustainability regulations and frameworks, and Dan will talk a little bit more about that later in the presentation. I think importantly, all of those factors and characteristics combine to make the portfolio highly resilient, and that's been demonstrated throughout time. The fund IPO'd back in 2006.
Obviously, since that period in time, it's endured various different macroeconomic conditions and geopolitical events, and throughout that period has continued to achieve high levels of operational performance and provide investors with dividends that have grown every single year. Now, that approach hasn't changed since the fund was established back in 2006. And what I want to just talk about now for a second is actually what has that approach resulted in? So what is the current investment case? So first, if we look at it from a financial perspective, looking over at the left-hand side of the screen, the projected net returns for investing in INPP, using the share price as at 30th of June 2024, was 9.3%, which is significantly above that offered by a UK government bond of similar duration.
Actually, the premium over investment that could be achieved by investors from investing in INPP over and above a bond is around four hundred and sixty basis points, which I think is a really attractive premium relative to historical standards. The majority of those returns, so those 9.3% returns, those are total returns, but actually the majority of those returns are delivered through dividend yield, and you can see that from the 6.6% statistic, which is the twelve-month look-forward dividend yield that was available as at thirtieth of June. In terms of the inflation linkage, the 0.7%, that is...
What that is trying to say is that if inflation were to run a hundred basis points above the assumptions that we assume, you would expect to see a seventy basis points pick-up in returns, which hopefully provides investors with some comfort that the real value of their returns is largely protected in a higher inflationary environment. Moving on to the diversification and nature of the underlying assets, we have over a hundred and forty different investments. They are spread across stable, developed OECD member countries, and for the most part, the revenues are availability-based or regulated. And then finally, on the right-hand side, in terms of the way that we manage these assets, Amber, the investment advisor, has one of the largest independent teams within the sector.
It's got a strong focus on active asset management and a very good track record of identifying attractive and accretive investment opportunities. I think it's that ability to continue to further optimize the assets, further optimize the portfolio, and add to the portfolio through new investments over time, that has in the past and can in the future result in us being able to outperform projected base case returns, and then finally, on the bottom right, we mentioned portfolio contribution, and what we're trying to say there is actually there's a very clear ESG story. Through our alignment with the UN Sustainable Development Goals, and you'll see those dotted throughout the presentation and within our interim report, investors can clearly identify the non-financial contributions that their investment in INPP is helping to facilitate.
So turning to the results for the period, the net asset value was down, circa 2% to 149.5 pence per share, and that's really because of the discount rate value of the assets. Those rates have slightly increased, and I'll talk specifically about the rationale for that later on in the presentation. I think it's important to note that while the net asset value has reduced over the period, we obviously paid out just over 4 pence per share in terms of dividends, and therefore, on a total return basis, there was a small positive return for the period.
We've increased our dividends for sixteen consecutive years, and that trend continues with the twenty twenty-four dividend target being set at 8.37 pence per share, which is a 3% growth compared to what we paid out in the comparable period in twenty twenty-three. We expect those dividends to be fully covered by net operating cash flows, as indeed was the dividend that was paid in the period, which is 1.1 times covered. I will talk a little bit about our capital allocation strategy later on in the presentation, but just to make a quick point with reference to the statistic at the bottom left of your screen, in terms of the cash investments that were made in the period.
I think whilst we have, and we'll, we'll talk about the, the focus that we've had in terms of divestments over the past 18 months or so, it is important to stress that we are still able to identify very attractive investment opportunities into which we can reallocate capital within the portfolio to improve investor returns. And, a key example of that within the period was the company's circa GBP 80 million acquisition of the Moray East OFTO. OFTO standing for Offshore Transmission Owner. This is one of the project companies that owns the electricity transmission infrastructure that connects an offshore wind farm to the onshore grid, allowing that renewable electricity to flow through for people to use.
Just on the right, I mentioned the UN Sustainable Development Goals already, but obviously, as I said, that is a key part of the way we assess and demonstrate the positive contribution that the fund makes, and perhaps the only point that I'll pick up in the period is the increase in the number of homes or the equivalent number of homes that are capable of being powered by the company's OFTO portfolio. Because of that acquisition in the Moray East OFTO that I mentioned a second ago, INPP now has 11 OFTOs in its portfolio, and that increase is effectively resulting in an increased contribution by the fund towards the transition to net zero.
Just turning to dividend growth, this chart just sets out our track record of growing the dividend every year. And as you'll see from the inception of the fund through to 2022, 2023, we had around 2.5% annual dividend growth. But what we did for the 2023 dividend and 2024 dividend was that we increased them by a greater rate of growth, and that was really to reflect the fact that we were going through a period of higher inflation. The inflation linkage within our underlying assets resulted in greater revenues, and we wanted to be able to pass on some of those additional revenues to investors through higher dividends.
With inflation now moderating, we are currently assuming a reversion to our previous long-term average growth rates of 2.5%, such that our 2025 dividend target is currently GBP 0.0858. I've mentioned already the attractive dividend yield of just over 6.5%, and the other statistic that I wanted to draw out is around the confidence that we have in the underlying cash flows in being able to meet our progressive dividend policy for the next 20 years plus, and I think that's perhaps borne out even more when we look at the chart on the next slide, so you would have seen this chart previously, but this is perhaps a more detailed version.
So what we've tried to do, we've tried to enhance the disclosure in a couple of ways. Firstly, we've broken down the investment receipts between the three different categories of assets we have in the portfolio. So you can see we're showing through the dark blue segments, we're showing the cash flows from our PPP projects. The sort of medium blue are the cash flows coming from our operating businesses, and the light blue portion are the cash flows coming from our regulated assets. So that's the first enhancement we've made to the chart, and the second enhancement is to add on a projection of the net asset value over time. So that's really just designed to illustrate how the NAV of the portfolio could evolve over time, other things being equal.
And I think it's important to stress here that this chart goes out to twenty fifty-four. That's not the end of the fund. We've just selected the next thirty years, because if you go to the longer term, it sort of you can't see the detail that you might otherwise want to see. But you can see that the cash flows continue by the fact that the Net Asset Value in twenty fifty-four is illustrated at being north of one billion. Some people ask about why the profile is a little bit lumpy, and there are a couple of main reasons for that. The first is that with public-private partnerships, a PPP project, what you tend to find is that these are concession-based investments, so you'll have an operational period of, say, twenty to twenty-five years.
But actually, before you get to the end of the concession, you've already paid off the debt financing, and therefore, you have additional cash flows within that project to distribute out to investors. And that's one reason why there's some additional lumpiness at the end of a certain concession period. For example, you can see a greater dark blue bar in twenty thirty-six. The other reason is because we ascribe some value to assets when they get to the end of their license period, typically, and here we're really talking about those OFTO assets that I mentioned a second ago. With an offshore transmission asset, what happens is that Ofgem, the regulator, grants an availability-based initial revenue stream.
That initial revenue stream is generally for twenty to twenty-five years, but actually the economic lives of the component parts or the assets that we own are greater than the length of that initial revenue stream. And therefore, what we do in our modeling is we ascribe some value to the asset at the end of that initial revenue stream. And, you know, you might see that coming through, for example, in a greater light blue portion in twenty forty-four and twenty forty-seven. I've mentioned it already, but we, you know, talk quite a bit about our ability to service the progressive dividend for the next twenty-plus years from the existing portfolio.
And some investors have said, you know, "That sounds really good, but can I just understand a little bit more about what's the capital value of the fund at the end of that time frame?" So that's one of the reasons that's prompted us to put on here the illustration of the evolution of the NAV over time. So if you want to get an idea as to the projected returns for investing in IPP over various different time horizons, hopefully, this chart allows you to do that. And the other takeaway I'd hope you'd have from this chart is, I guess, a reminder as to the predictability of the cash flows within the portfolio and the longevity, and obviously our associated expectation of continuing to be able to service that progressive dividend policy.
In terms of discount rates, we obviously have to determine the fair value of our underlying assets, and of course, that goes through external audit by PwC. But when we're trying to determine those valuations, we use a discounted cash flow valuation methodology. So we determine a discount rate that we apply to each of the individual investments within the fund. And we don't set out all of the discount rates that we use here, but what we've tried to do is provide you with a little bit more detail.
So we've got the weighted average discount rate that we use of 8.7%, and in the little schematic at the bottom left of the slide, we've tried to give an indication as to the range of discount rates that we use to value the assets in those three subsectors that I mentioned: PPP projects, regulated investments, and operating businesses. And what we're seeing at the moment is that in the market, there are lots of discussions and lots of processes that are ongoing. But actually, perhaps the number of transactions that are completing are less than what we've seen in prior periods, and probably the total value of transactions that we're seeing is also less than what we've seen in recent years.
I think that's an indicator of, you know, a current reduction in liquidity, which we've had to try and consider as part of our valuation processes. Taking into account that part, that sort of current lack of liquidity, as well as other data points that we have, we've sought to increase the discount rates that we apply. We're being prudent by increasing our discount rates, from, on a weighted average basis, 8.4% to 8.7%. In terms of where those rates have changed, it's really the assets at the lower end of the range, as you can see from the chart at the bottom left. I think it's important to remind everyone that the sector remains very attractive.
If you look at the amount of capital that was raised for infrastructure strategies in the first half of twenty twenty-four, it was a marked improvement on what we saw in the first half of twenty twenty-three. And the allocation to infrastructure across all types of institutions, again, increased in the first half of the period. So there are positive signs that additional liquidity is coming, which would be supportive for valuations. But we've sought to take what might arguably be considered a relatively conservative view in the period. Obviously, if people have different views as to what an appropriate discount rate should be, they can use the sensitivity that we've included in the top right of the chart to work out what they think the net asset value of the fund should be.
For example, if they want to do a comparison across the peer group. I won't spend too long on this chart, but just to pull out a couple of points, because this chart is just setting out the component parts underpinning the change in the NAV over the period. The first is the share buyback program, which is part of our wider capital allocation strategy, and again, I'm gonna talk about that in a moment, but what you see here is the cash outflow, i.e., the fund buying back its own shares, and that's because, you know, we're looking at it on a NAV perspective. We're not looking at it on a NAV per share basis.
But if you were to look at it on a NAV per share basis, you would see that the share buyback is accretive because, of course, whilst we're spending money to buy back shares, we're obviously removing and reducing the number of shares in circulation, which is, which helps the NAV per share. I've already talked about the discount rate, so I won't mention those again, other than just to say the net impact of discount rate changes was circa GBP 70 million, as you can see from the first green bar and the second orange bar. So we paid out dividends in the period. They were just over GBP 0.04 per share. The total was GBP 78 million, and they were paid in line with the guidance we provided investors with previously. And then we're on to sort of the macroeconomic changes.
The foreign exchange rate changes are quite mechanical, just reflecting the change in the spot rates, and that's because we saw sterling strengthen against five of the currencies that the fund is exposed to. And then the macroeconomic assumptions is a relatively small movement of GBP 3 million, just reflecting the net impact of lower short-term inflation, but higher longer-term inflation assumptions. And then the NAV return is sort of the unwind of the discount rate, and that was in line with expectations for the period, indicating that the assets continued to perform. So, as promised, I was just gonna do a little bit of a sort of deeper dive into the capital allocation strategy. And I suppose the reason why we're trying to be so clear in terms of how we're allocating stra...
Capital is because obviously, over the last eighteen months or so, you know, there have been various factors that resulted in the share prices of INPP and another investment trust trading at a discount to their net asset value. We've obviously been proactive in taking steps to try and remedy that and try and make sure the fund is as well positioned as possible. The steps that we've taken have been in line with this capital allocation strategy, which has three sort of component parts. The first is prudent use of the company's corporate debt facility. So historically, well, we still have the facility, but historically, we've used the corporate debt facility to efficiently finance new acquisitions.
But actually, given current market conditions, excuse me, and the fact that it is a floating rate facility, the board made it a priority around a year ago to pay down that facility. And that is exactly what we did. So through asset sales that were completed towards the back end of 2023, we used the proceeds to pay down that corporate debt facility, which obviously reduces the interest burden on the fund and reduces the risk because it is a floating rate facility. We have also reduced the size of the facility from GBP 350 million down to GBP 250 million. As I said, there are no cash drawings under that fund, but obviously, we have to pay commitment fees on the amount of the or on the size of the facility.
So reducing the size of the facility reduces the commitment fees that we have to pay, while still providing us with access to liquidity should we need it. The second principle of our capital allocation strategy is to maintain a targeted program of divestments, and that's to both demonstrate the underlying values are achievable and to reallocate capital. And if we look at, you know, what we've done over the last eighteen months, we've realized assets across... We've realized a UK PFI asset, we've sold regulated utilities, we've sold our OFTO, some of our OFTO investments. We sold a digital asset. So we've made sort of divestments across a few sectors that have totaled, you know, around GBP 235 million.
I think it's really important to stress that the divestments that have been made have been made at prices that are in line with previously published valuations. We've always used debt prudently, and therefore, we were not, and we are not in a position where we need to sell assets, but we want to continue to maintain a targeted program of divestments in order to demonstrate that the valuations that we hold our assets at are achievable and robust, but also to be able to reallocate capital in a way that is attractive and efficient for shareholders. The third principle really deals with that, so it talks about the way in which we're going to allocate or reinvest those divestment proceeds.
With the shares trading at a discount to the NAV, buying back our own shares is a really attractive investment opportunity, and therefore, that sets that effectively sets a threshold through which the economics of any new investment need to be assessed. If we think about what we've done with the divestment proceeds to date, we've paid down the corporate debt facility, as I mentioned, and then we've used proceeds to to acquire the Moray East OFTO. I mentioned that at the start of the presentation. That was circa GBP 80 million, and that OFTO was acquired on very attractive terms. We started a buyback program.
So we initially started a buyback program of GBP 30 million, and we said the program was gonna run for the calendar year 2024, but we're now saying we intend to increase that buyback program to up to GBP 60 million and extend the duration of the program out to March 2025. So that should provide greater and ongoing support for the share price, as well as being a demonstration of our confidence in the quality of the assets that we have and the values that we ascribe to them. And just finally, before I move on from this slide, we've set out at the bottom of that slide some other initiatives that we've undertaken.
The first, I've alluded to a couple times already, but it's the formalization of a new return target for new investments to give investors comfort that we are considering the relative economics of a share buyback whenever we consider the attractiveness of any new investments. The second and third points within that box at the bottom are around the dividends. We've both increased dividend growth, as I talked about earlier, and we're increasing the dividend frequency. We have now announced that we will increase the dividend frequency as of June next year. From June next year, investors will no longer receive dividends on a semi-annual basis, but actually on a quarterly basis, which hopefully is positive.
Despite the actions that we have taken, we continue to believe the share price materially undervalues the company, and of course, the share price will continue to be impacted by macroeconomic factors. We would hope that we get more positive macroeconomic data, which will be supportive to the share price. Notwithstanding that, we are committed to continuing to proactively take steps in line with our capital allocation strategy, which should ultimately help to mitigate risk, prove values, and enhance returns. Now, just moving on to the next few slides, just wanted to give a little bit of an update on the operational performance of the assets within the portfolio, and I'll start with the regulated assets.
So we have 13 assets within the portfolio whose revenues are regulated by U.K. independent economic regulators, Ofgem and Ofwat, the energy regulator and the water regulator, and these assets make up around half of the portfolio. Now, just starting with Cadent, and Cadent is a critical U.K. infrastructure asset. It facilitates the distribution of gas to around half of the population. It is not an energy supplier. It earns regulated returns from providing a safe and reliable distribution network. And that business continues to perform very well. So that business is achieving outstanding levels of safety, outstanding levels of reliability. And if we look at it from a financial perspective, you know, in the period to the thirtieth of June, what cash flows did we expect to receive from Cadent? We received slightly in excess of what we forecast.
So it's performing well from both an operational and a financial perspective. Now, Cadent's revenues are regulated by Ofgem, and Ofgem determines the revenues available to Cadent for a five-year price control period. And we're currently in the middle or perhaps just past the middle of the current period, which ends in March 2026, and Ofgem is currently consulting on what revenues will be available to Cadent in the next price control period, which starts in April 2026. The consultation process is very well known to us. We've been through it before, and we'll obviously continue to engage in the process in the lead up to the publication of final determinations in late 2025. The most recent announcements from Ofgem have been very helpful.
They've indicated that the approach they will take to regulation in the next price control period won't significantly change from the approach they're adopting in the current regulatory period. And they've also noted the importance of the regulatory framework to be adaptable, to protect investors in the context of various possible pathways to net zero. So the gas network distributions, more generally, have a critical role to play in facilitating the transition to net zero because they're continuing to safely and reliably provide gas, which is obviously facilitating the incremental introduction of more and more intermittent renewable technologies. And, of course, the gas networks, more generally, are working with governments to demonstrate the opportunities offered by cleaner fuels, such as hydrogen and biomethane, in the future.
So it's really the extensive nature of Cadent's assets, its role in the transition, and the inherent protections afforded to Cadent through the regulatory regime, which provide us with a great deal of confidence that Cadent will play a key role in the U.K. energy system for decades to come. Moving on to Tideway. This is the second-largest asset within the portfolio. This is the company that's building the 25-kilometer super sewer under the River Thames. Construction works have now been completed, and commissioning is due to start shortly. And once commissioning is complete, which is scheduled for the second half of 2025, the asset will be fully operational.
It's at that point that it should be able to intercept 95% of the current overflows or the polluting overflows from the existing sewerage network, which will obviously have significant positive environmental benefits for London and the wildlife. The financial challenges being faced by Thames Water, and just to put it in context, Thames Water is Tideway's direct revenue counterparty. So Tideway doesn't bill consumers directly. Thames Water has a legal obligation that's set out within its license to collect money for Tideway. So when it bills consumers, part of that money is collected by Thames Water and paid over to Tideway. And obviously, the financial challenges being faced by Thames Water are very well-publicized.
But we continue to have confidence in the adequacy of the existing statutory and regulatory protections that are afforded to Tideway, which are themselves designed to mitigate the risk of any disruption to the flow of revenues from Thames Water. So we don't expect the financial challenges posed by Thames Water or indeed a change in the status of Thames Water to have any material impact on Tideway. Just moving on to the offshore transmission assets. We have 11 in the portfolio. They are all, bar one, performing extremely well. The one that is not performing as well as it should be is the East Anglia One OFTO, and that's because that asset has suffered a cable fault. Firstly, just to say that the repair works for that cable are already scheduled.
They should start in the next few weeks, and we expect the cable to return to full service within the next couple of months or so. But I think it's important to stress that the cable fault is, in our view, an issue due to the or an issue with the manufacturer or installation of the cable itself, and therefore, we expect the regulatory protections that are set out in our license to hold us harmless for any revenue deductions that we would otherwise have faced. And because the cable's remained under warranty with the original manufacturer, we expect the original manufacturer to pick up any costs of repairing those cables. So whilst this is an operationally disappointing factor, it's not something that will have any financial material impact on the portfolio.
Just quickly on the final bullet point, and we've been talking about this for probably about three years, ever since Ofgem started the consultation. But Ofgem continue to consult on the most appropriate way to extend the revenue framework for these assets. As I mentioned earlier, they have an initial revenue stream, circa 20-25 years. And Ofgem, the regulator, is currently consulting on how they extend that framework to ensure the continued use of these assets, because obviously, the continued use of the assets is critical given the government's ambitious offshore wind targets and net zero ambitions more generally. Moving on to our PPP projects. We have just over 100 individual PPP projects. These are concession-based investments.
They represent around 40% of the portfolio, and these assets have continued to form very well during the period. I mentioned, you know, these are availability-based projects for the most part, and therefore, the availability statistic is really important for us. Availability in the period was 99.8%. And actually, if you think that, you know, that nought point 2% deduction is something that impacts us, it actually doesn't, because we pass on that deduction to third-party facilities management contractor, in any case. But it is actually an important statistic because it demonstrates how well our assets are performing for our public sector clients, and that's, of course, very important to us.
For the vast majority of PPPs, what happens at the end of that concession period, which again, is circa 20 to 25 years, the assets and the associated services need to be handed back to the public sector. This is becoming an increasingly common talking point or discussion point within the industry because there are a lot of PPPs in the market that are come getting towards their handback dates. The first of our PPPs goes through that process next year. It's a very small U.K. courts project. It represents around 0.1%-0.2% of the portfolio, and activities are well underway. Actually, for the vast majority of our portfolio, the handback dates are not until the mid-2030s.
So in some ways, it's, it's a little bit of a shame talking about the handback of these projects when they've still got, you know, 10, 15 years or so still to run. But I think it's important that we talk about it, and I think it's important that we set out the reasons why we believe investors should have confidence in our ability to facilitate an efficient transfer of these assets in the future when the time arises. And those factors are sort of threefold.
One is we have a strong in-house asset management team that I mentioned earlier in the presentation, and that team is focused on proactively monitoring asset condition, monitoring maintenance, and lifecycle works that need to be undertaken, and ultimately seeking to ensure that the assets will meet the criteria set out in the handback specification when we get to that point in time. The second is that actually, if it turns out that some remedial works need to be undertaken, well, for the vast majority of PPPs in our portfolio, we've passed that cost risk on to a third-party contractor, so it's not something that will impact on our projects.
And then finally, and more for the avoidance of doubt, we do not assume any additional revenues will be generated from the projects when they reach the end of their concession date. So those are the three factors that should hopefully provide some confidence in terms of our ability to efficiently transfer the assets in the future. A quick note on the other two points on this slide. Diabolo Rail, it is unlike the rest of the portfolio because most of the portfolio is generating availability-based or regulated cash flows, whereas actually the majority of the cash flows on Diabolo are linked to usage of the asset. That is not unmitigated exposure to usage, because we have actually got the contractual right to change the passenger fare that the passengers pay to use the asset.
But I think it's important to stress that, well, A, we've got the contractual right to change the fare, and that is something we did last year, actually, following the reduction in passenger numbers that we saw during and in the immediate aftermath of the COVID-19 pandemic. But secondly, we are seeing very strong passenger numbers. So in the first half of 2024, we had around three million people use the Diabolo Rail link. That was in excess of the number of passengers that we saw in the first half of 2019, i.e., prior to the pandemic, and is slightly ahead of the forecasts we had assumed as part of our modeling. And then in terms of the divestment in the Three Shires, that's a UK PPP project.
We disposed of that post-period end, and it was disposed of at a price that was in line with our previous carrying value, which hopefully gives you some confidence in terms of the values that we ascribe to our assets. Then just one more slide before I hand over to Dan. In terms of the operating businesses, there are four of them in the portfolio. They make up 10% of the portfolio, and the largest is Angel Trains, which is a U.K. rolling stock leasing business. Angel owns over 4,000 vehicles. These vehicles are out on lease to train operating companies or TOCs across the U.K. as planned, so that asset is performing as expected.
People often ask about the proposals by the new Labor government to take measures in terms of the passenger railway in the UK. The initiatives that the Labor government has set out are not particularly new. They're largely inherited from the previous government, and they're principally twofold. One is to nationalize the operations of passenger services, and the second is to create GBR or Great British Railways, which will act as a directing mind for the railway industry. But these initiatives are really focused on improving the operations, the passenger services rather than the provision of rolling stock, and so they're not initiatives that are expected to have any material impact on Angel Trains.
If you look at the lease agreements that Angel has that govern the leases for these assets, they're contracted rates. They are not exposed to the number of passengers that are on the train or the number of services that are run. They are contracted. But I think it is very positive that we continue to see increases in the number of people using the railways. So I think we're up to around 95% of the number of people that we saw pre-pandemic, which, whilst it doesn't directly impact Angel now, I think is more positive for the rail industry going forward and should hopefully provide more investment opportunities for the Angel business over time. BeNEX is a rail business in Germany, and we've talked about this platform previously and talked about the potential to further grow this platform.
We're really pleased that during the period, BeNEX signed an agreement to acquire Abellio's German rail business. Abellio's German rail business principally comprises two train operating companies. They're operating availability-based passenger rail concessions in regions within Germany, in which BeNEX currently has little or no presence. I think that's really important because that will allow BeNEX to build relationships and to build a reputation in new areas. Hopefully, over time, again, that should add to new opportunities to further build the BeNEX business. That acquisition will cost in the region of 15 million GBP and is expected to be financed through existing cash reserves, helped by INPP and proceeds from near-term divestment activities.
And I think because I've referenced it a couple of times already in terms of how we assess the relative attractiveness of new investments, it's really important that I stress that while we don't publish the individual returns we expect to generate from these investments, the rate of return on this investment is projected to be significantly ahead of the rate of return achievable on a share buyback. And finally, just in terms of digital infrastructure businesses, we have two in the portfolio. They're very small in the context of the portfolio, representing around 1%, and they continue to perform well. And they're obviously continuing to build out their fiber network, but importantly, their business plans are fully funded, so they have no near-term capital requirements that are not already committed.
Dan, if it's okay, I'll just hand over to you for the next slide.
Absolutely. Thank you very much, Chris, and good afternoon to you all. Now, I'm gonna take you through the progress we've made in the first half of twenty twenty-four regarding our responsible investment strategy and also share some of the actions that we have planned for the second half of the year.... Now, this progress underscores our commitment to responsible investing and our ongoing work towards achieving our ESG policy objectives. Now, in the first half of twenty twenty-four, we took further steps to enhance transparency and align with regulatory standards. We released the third edition of our sustainability report, which included updated disclosures aligned with key frameworks such as TCFD, SFDR, and the taxonomy. Additionally, we revised our internal disclosure processes to align with the U.K.'s anti-greenwashing rules, helping to evolve our approach to non-financial reporting.
Essential focus has been the development of an engagement plan aimed at driving performance improvements across our investments, particularly with a focus on working towards our new net zero KPIs. The results of this engagement plan will be communicated in our year-end results, but we're really pleased that we've actually been progressing things at a practical level and have achieved all approvals required to install a roof-mounted solar PV array at one of our education investments, marking the first retrofit of solar technology within our social infrastructure portfolio. Now, looking ahead to the second half of twenty twenty-four, we'll continue to explore the evolving landscape of ESG requirements, particularly as they relate to the U.K.'s Sustainability Disclosure Requirements. Although we are not currently required to report in line with these regulations, we're actively assessing how we can better align our disclosures to support shareholders and investors.
In the coming months, we will intensify our engagement with investments based on the KPI engagement plan. Additionally, we will be forecasting emissions from these investments out to 2030, which will support setting targeted investment level goals, whereas economically feasible and within our control. Finally, we plan to further engage with public sector clients and operating companies to support their efforts in meeting the net zero targets. Now, this collaboration is essential in infrastructure to ensure we can continue to reduce emissions across the investment portfolio while aligning with wider climate ambitions. So in summary, we've again made solid progress in the first half of 2024 and are well positioned to continue this momentum into the second half. Our focus remains on transparency, stakeholder engagement, and contributing to global sustainability aims.
Thanks very much for your time, and I'm gonna hand back to Chris now to conclude the presentation of the results.
Thanks, Dan. I've just got two more slides to go through before we move over to Q&A. So the first is around the investment commitments and the future opportunities, and taking the commitments first. We have three long-standing investment commitments that we've talked about many times previously. Those are the Flinders University, the Gold Coast Light Rail, and tube commitments. And in addition to that, we now have the additional GBP 15 million that we've committed to BeNEX to help facilitate the acquisition of Abellio's German rail business. So that means we've got four investment commitments that total circa GBP 35 million, and as you can see from the chart at the top there, we've tried to provide a little bit more detail in terms of the timing of making those investments.
I think the key point is that we expect those investments to be funded from existing cash reserves and from cash that we expect to generate in the short term, including through ongoing divestment activities. In terms of future opportunities, the first point that we always like to make is that actually we don't need to make any further investments in order to deliver current projected returns, and I think that's a really important point to bear in mind. But there are various factors that underpin the pressing needs for governments to both upgrade existing infrastructure and to build new infrastructure. I think if you couple that with the competing demands on public finances, then we see there being a key role for private capital to play.
So while there is a very high threshold for us in terms of making a new investment, because we need to consider the relative economics of buying back our own shares, there should be plenty of attractive investment opportunities for us to invest in public infrastructure assets across our core geographies, and then finally, in terms of a summary and an outlook, the portfolio continues to perform very well. It's demonstrating its resilience against a volatile macroeconomic backdrop, and I think the reasons for that resilience are the same points that I mentioned at the start of the presentation: the nature of the cash flows, the government or government-backed counterparties that we have, the inflation linkage, and the robust capital structures.
We've continued to meet published dividend guidance, with dividends being paid during the period having been well covered by net operating cash flows, and of course, we've continued to grow the dividend as we have done every year since the IPO. The yield of just over 6.5%, I think, is really important, but I also think it's sensible to look at the total returns available, and as at thirtieth of June, the projected net total returns was 9.3% per annum, which was 4.6% or 460 basis points above that offered by comparable U.K. government bonds, so I think it's a really attractive investment premium that can be generated by investors, so the outlook is really positive.
We remain very confident in terms of the future performance of our existing assets. We're in a very strong liquidity position, having paid down our corporate debt facility. So we've got a robust platform from which we can continue to actively manage the portfolio and reallocate capital in a way that further enhances shareholder returns.