Cordiant Digital Infrastructure (CORD) is poised to enter the FTSE 250 after delivering a second year of strong returns with the shares continuing to rerate in anticipation of the returns from its big investment in datacentres.

Annual results for the year to 31 March show the European and US portfolio generated a total underlying return of 16.3%, or 12.3% excluding currency movements, with net asset value (NAV) per share rising to 146p from 129.6p. That compared to 11.6% growth in the previous year.

Including 4.45p per share of dividends, up 2.3%, shareholders made a total return of 24.6%, impressive but moderating from 43.1% in 2024-25. The outperformance of the share price comes amid a steady narrowing in the wide gap to the value of its assets.

Since the end of March up to 17 June, the shares have rallied another 22.7%, reducing the discount to NAV to 14.7% from 25.5% a year ago. That has pushed the value of the investment company to £957m, up from £370m at launch in February 2021 and gaining it promotion to the index of companies outside the top FTSE 100.

Excluding the acquisition of a 47.5% stake in Belgian datacentre owner DCU in February last year, operating profits and revenue grew by 7.8% and 9.9%, providing 1.7 times earnings cover for the quarterly dividends that underpin a 3.5% yield.

CORD’s six portfolio companies spent £49.4m on capital expenditure to support future revenue growth, nearly half of it on data centres benefiting from the rollout of artificial intelligence (AI).

The company said it had high visibility on revenues with over £952m of total income across the lives of all its contracts.

Fund manager Steven Marshall, who owns 2% of the shares, said: “We are pleased with the operational performance delivered by the portfolio over the past five years. The company benefits from a portfolio of high-quality digital infrastructure assets, supporting blue-chip and government customers through long-term contracts in growing markets.

“Our core businesses are leaders in their respective markets and continue to expand their infrastructure coverage, both through the construction of additional assets and bolt-on acquisitions that further strengthen their customer offering.” 

Our view

Richard Williams, senior analyst at QuotedData, said: “There are a lot of positive takeaways from Cordiant’s results – contract wins, inflation-linked price escalators, acquisitions and cost discipline. This translated into tangible NAV growth, validating management’s strategy of investing capital into higher-return development opportunities, with significant progress at the Prague Gateway data centre project. A host of other portfolio wins reinforce the investment case and shows up the wide discount to NAV Cordiant has been trading on. It is pleasing to see this come in in recent months, but we believe this has further to go.”

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