Results for the year to 31 March 2015

	Our market focus	Our approach
Core infrastructure	§ Dynamic businesses that own their asset base in perpetuity, not concessions with a finite life § Key sectors: utilities, energy and transportation § Size of investments: equity investments typically between £50 million and £250 million § Return characteristics: typically between 8% and 10% with a mix of income yield and capital growth, with low volatility	We originate investments through the Investment Adviser's dedicated team based in London and Paris, as well as drawing from its broader European network, with offices in Amsterdam, Frankfurt, Madrid and Stockholm. We generate returns during our ownership through the Investment Adviser's engaged asset management approach. The Investment Adviser represents the Company on the boards of all Core investments, engaging with senior management to support: § strategies for investment in the asset base to support profitable growth over the long term; § continued improvements in operational performance; § disciplined cash management to drive yield for shareholders; § efficient capital structures to optimise funding costs and financial risk; and § growth through acquisitions if suitable opportunities arise. We will sell investments from time to time where this generates significant additional value for shareholders.
Primary PPP and low-risk energy	Primary PPP § Concession-based projects in their construction phase, with a concession period typically of 20 to 30 years § Key sectors: education, transport, healthcare and public sector accommodation Low-risk energy § Key sectors: wind and solar projects as well as Offshore Transmission Owners ("OFTOs") § Focus on geographies where we believe that subsidy regimes are robust and will be sustained over the full life of operating projects § Size of investments: equity investments typically between £5 million and £50 million § Return characteristics: typically between 9% and 12%	Our approach is to originate attractive opportunities through the Investment Adviser's relationships with primary developers, including construction companies. We also leverage the Investment Adviser's expertise in the assessment and management of construction risk. We generate returns by managing primary PPP and low-risk energy projects through their construction phase and operational ramp-up. Once projects become operational, they can be held for yield or sold to crystallise value as part of our broader portfolio management approach.
India Fund	In May 2013, the Board announced that the Company would not make any further investments in India or in other developing markets	The Investment Adviser is managing the assets in the India Fund for realisation over the coming years through a dedicated team of investment professionals based in Mumbai.

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3i Infrastructure (3IN)

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	FY2015	FY2014
Total return materially above annual target
Total return of £267 million for the year, or 24.6% on opening Net Asset Value ("NAV"), materially above the target of 10%. Strong performance driven by the value uplift from the realisation of our interest in Eversholt Rail and valuation gains across our European Core investments	24.6% Total return on opening NAV¹	6.6% Total return on opening NAV¹
Strong growth in NAV per share to 149.9 pence at 31 March 2015	149.9p NAV per share	126.4p NAV per share
Proposed dividend ahead of target level
Total proposed dividend of 7.0 pence per share (£61.7 million in aggregate), or 5.7% on opening NAV, ahead of the objective for FY2015 of 5.5% (6.77 pence per share)	7.0p Total proposed dividend per share	6.7p Total dividend per share
Good level of new investment
£114.2 million committed to the investment in two further oil storage terminals with Oiltanking in Belgium and the Netherlands and to five new primary PPP investments in France, the Netherlands and the UK	£114.2m Investment commitments	£80.3m Investment commitments
Robust portfolio income
Portfolio income of £79.5 million, in line with prior year	£79.5m Portfolio income²	£82.3m Portfolio income²

Peter Sedgwick, Chairman, 3i Infrastructure plc	Tel: 01534 847 410
Silvia Santoro, investor enquiries	Tel: 020 7975 3258
Kathryn van der Kroft, press enquiries	Tel: 020 7975 3021

Core Infrastructure	Public Private Partnerships ("PPP")	India Fund
§ Four investments: − Anglian Water Group UK: water utility − Elenia Finland: electricity distribution − Oystercatcher Europe and Asia: oil and oil product storage terminals − Cross London Trains UK: rail rolling stock § Sale completed after the year end: − Eversholt Rail Group UK: rail rolling stock	Primary projects § Six investments: − A9 Netherlands: road project − A12 Netherlands: road project − Ayrshire College UK: education facilities − La Santé France: prison accommodation − Mersey Gateway Bridge UK: bridge project − RIVM Netherlands: government office accommodation Operational projects § Four investments, including 64 underlying projects − Dalmore Capital Fund UK: secondary PFI projects − Elgin UK: school and community healthcare projects facilities − NMM Netherlands: museum facilities − Octagon UK: healthcare facility	§ Seven investments: − Power generation − Roads − Ports The India Fund is now closed to new investment and its investments will be realised over time
As at 31 March 2015 83%	As at 31 March 2015 12%	As at 31 March 2015 5%
Pro Forma analysis 77%	Pro Forma analysis 16%	Pro Forma analysis 7%

	31 March 2015		Pro Forma analysis
	£m	%	£m	%
Core infrastructure portfolio	1,051	83%	743	77%
Eversholt Rail Group	360		Sold
Anglian Water Group	242		242
Elenia	239		239
Oystercatcher	110		162
Cross London Trains	100		100
PPP portfolio	159	12%	159	16%
Primary projects	50		50
Operational projects	109		109

India Fund	63	5%	63	7%
Total investments	1,273	100%	965	100%
Total cash balances	75		161

	Impact of changing market conditions	Steps taken
Updating our total return target to be sustainable	§ Material compression in returns, particularly in large Core infrastructure § While this has resulted in valuation gains across our investment portfolio, it is more challenging to secure new Core infrastructure investments at prices consistent with the Company's return targets	§ Updated total return target from a 10% annual target to a sustainable target of 8% to 10%, to be achieved over the medium term § This will provide the Company with increased flexibility to invest across the infrastructure market, at attractive risk-adjusted returns for shareholders
Setting a new dividend policy to be progressive	§ The compression in market returns has driven a material increase in the value of our portfolio and NAV § While NAV has increased materially, the underlying income from our portfolio remains broadly constant § The Company's previous dividend policy linked dividends to opening NAV and was therefore no longer sustainable	§ Introduced a new and progressive dividend policy which sets an absolute dividend per share § In the future, the Company will pay a progressive annual dividend per share, beginning with a target dividend of 7.25 pence per share for FY2016
Actively managing liquidity and maintaining an efficient balance sheet for future investment	§ Took advantage of market conditions during the year to sell our interest in Eversholt Rail at a significant uplift, generating material cash proceeds for the Company and excess liquidity § Favourable debt market conditions enabling the Company to increase and extend its revolving credit facility ("RCF") on more attractive terms and improve its overall cost of funding	§ Negotiated new RCF, increasing facility from £200 million to £300 million on improved terms § Proposed change to single-asset concentration limit, increasing from 20% to 25% to provide additional flexibility for future investment § Combination of an exceptional return from the sale of Eversholt Rail and increased RCF facilitates a return of capital to shareholders of £150 million, to be made in July 2015 through a special dividend of 17.0 pence per share § Minimise returns dilution from holding excessive cash balances, while maintaining a good level of liquidity for future investment

1	Opening NAV is net of the final dividend for the prior year.
2	Portfolio income comprises aggregate dividends, interest income and fees received during the year from portfolio assets and is consistent with the measure used in previous years.

Total return % on opening Net Asset Value		Annual dividend % on opening Net Asset Value		Portfolio balance % of portfolio
					PPP	Core	India
FY15	24.6%	FY15	5.7%	FY15	9%	86%	5%
FY14	6.6%	FY14	5.5%	FY14	11%	82%	7%
Target for the year
To provide shareholders with a total return of 10%		To provide shareholders with an annual dividend of 5.5% of opening NAV		At least 75% of the portfolio invested in Core infrastructure
Outcome for the year
Total return of 24.6% for the year to 31 March 2015		Dividend of 5.7% of opening NAV for the year to 31 March 2015		86%¹ of the portfolio invested in Core infrastructure at 31 March 2015¹
Rationale and definition
§ Total return is how we measure the overall performance of the Company § Total return comprises the investment return from the portfolio and income from any cash balances, net of advisory and performance fees and operating and finance costs. It also includes movements in the fair value of derivatives § Total return, measured as a percentage, is calculated against the opening NAV, net of the final dividend for the previous year, and adjusted to take into account any equity issued in the year		§ This measure reflects the dividends distributed to shareholders each year § The Company's business model is to generate returns from portfolio income and capital returns (through value growth and realised capital profits). Income, other portfolio company cash distributions and realised capital profits are used to meet the operational costs of the Company and make distributions to shareholders § The dividend yield, measured as a percentage, is calculated against the opening NAV, net of the final dividend for the previous year and adjusted to take into account any equity issued in the year		§ The Company's strategy is to deliver differentiated access to the infrastructure asset class by investing in a portfolio weighted towards Core infrastructure investments that own their asset base in perpetuity § This provides shareholders with a differentiated investment proposition versus other UK-listed infrastructure investment vehicles § The India portfolio is being managed by the Investment Adviser with a view to realisation over the next few years
Performance in the year
§ Total return of £266.8 million, or 24.6% on opening NAV in the year, significantly above the 10% objective § Strong return driven by the value uplift from the sale of Eversholt Rail and valuation gains across the European portfolio § Costs ahead of last year, due to the increased levels of bidding and additional corporate costs § Exceptional return generated a performance fee of £45.0 million		§ Total dividend declared for the year of £61.7 million, or 7.0 pence per share, ahead of the annual objective of 6.77 pence per share § Income and fees generated from the portfolio and cash deposits, including non-income cash distributions from portfolio companies, totalled £85.0 million for the year. Operational and net financing costs used to assess dividend coverage were £21.5 million, hence dividends and costs were fully covered		§ 86%¹ of the portfolio invested in Core infrastructure at 31 March 2015 § Realisation of the India portfolio commenced in the year, with the sale of approximately 54% of the India Fund's stake in Adani Power § Based on the Pro Forma analysis, following the sale of Eversholt Rail the percentage of the portfolio invested in Core infrastructure remains above 75%
Changes effective from FY2016
Total return objective updated to a range of 8% to 10% to be achieved over the medium term		Progressive dividend per share policy Target dividend for FY2016 of 7.25 pence per share. This target dividend is calculated assuming that the share consolidation is approved		¹For the purpose of this analysis, the portfolio is measured as the underlying portfolio asset value for each asset and does not include investment commitments until they are drawn. Including investment commitments, this percentage is 83%.

Strategic priorities	Implementation
Board	Investment Adviser
Maintain a balanced portfolio of infrastructure investments in developed economies, focusing on the Core infrastructure market, as well as building exposure to primary PPP and low-risk energy projects which offer attractive risk-adjusted returns	Maintain a clear focus on the Company's target markets, deploying the investment and asset management skills necessary to deliver the Company's strategy and objectives
Manage intensively the portfolio to deliver a robust income yield and stable capital appreciation over time	Apply consistent and rigorous asset management to drive good operational performance in investments, underpinning portfolio cash generation and capital growth
Add selectively to the portfolio, targeting opportunities in our markets and realise assets opportunistically when a sale crystallises value above that achievable by holding the investment and when the sale is consistent with the Board's target portfolio balance	Adopt a rigorous approach to new investment, pricing opportunities in a way that is compatible with the Company's risk-adjusted return objectives and portfolio balance and assessing realisation opportunities as they arise
Manage the Company's financial position efficiently, minimising return dilution	Leverage the Investment Adviser's processes and resources to ensure that financial risks are monitored adequately and that liquidity is managed appropriately
Manage the relationship with the Investment Adviser, securing access to its specialist investment and asset management skills over the long term	Maintain a regular dialogue with the Board, ensuring that the Investment Adviser's capabilities and services are firmly aligned with delivering the Board's objectives successfully

Strategic priorities	Risk factors in FY2015	Delivery in FY2015
Maintain a balanced portfolio of infrastructure investments focusing on the Core infrastructure market, while building exposure to primary PPP and low-risk energy projects	There were no material risks to maintaining a portfolio focused on Core infrastructure and the portfolio balance remains aligned with the Company's objectives. The assets in the India Fund are to be realised over time. A combination of market, political and asset-specific risks continues to affect their potential realisation.	At 31 March 2015, 83% of the portfolio was invested in Core infrastructure, and 12% in the PPP market. In a challenging market environment, the Company committed £114 million to new investments in both Core infrastructure and primary PPP projects. The India Fund sold approximately 54% of its holding in Adani Power during the year. As shown in the Pro Forma analysis, following the realisation of Eversholt Rail in April 2015, the balance of the portfolio remains in line with the Company's objective.
Manage intensively the portfolio to deliver a robust income yield and stable capital appreciation over time	A number of the investments in the portfolio, including notably AWG and Elenia, were subject to regulatory developments during the year. Some of the assets in the portfolio are sensitive to low interest and inflation rates. Low interest rates have a particularly negative impact on Elenia, whose allowed return is calculated based on the Finnish 10-year government bond yield.	The Investment Adviser continued to dedicate significant resource and expertise to portfolio management, engaging with investee companies to manage the risks deriving from regulation and the persisting low interest rate, low inflation environment. Portfolio income levels were stable year-on-year at £79.5 million (2014: £82.3 million). The Investment Adviser worked with AWG and Elenia to manage regulatory developments, including the UK water sector regulatory review for the 2015-2020 period. In positive market conditions, Oystercatcher refinanced its debt and Elenia issued further bonds on attractive terms.
Add selectively to the portfolio, targeting opportunities in our markets and realise assets opportunistically	There was continued compression in returns in the European Core infrastructure market during the year. While this had positive valuation implications for the portfolio, it has been more challenging for the Company to secure new investments at total returns and yields consistent with its existing targets.	The Company was able to take advantage of prevailing market conditions to crystallise an exceptional return through the sale of Eversholt Rail, which generated an uplift of £139 million compared to the valuation at September 2014 and an IRR of over 40% over the life of the investment. This sale was a key driver of the return for the year. The Investment Adviser leveraged its network and expertise across the infrastructure market to continue to invest, committing a total of £114 million to new investments in the Core infrastructure and primary PPP markets. The expansion of the Investment Adviser's primary PPP origination capabilities increased the Company's portfolio in this sector through commitments to five new investments.
Manage the Company's financial position efficiently	During the year, the Company had to balance the liquidity requirements of an active pipeline of investment activity with the objective of running its balance sheet efficiently. The Company was exposed to foreign exchange risk due to highly volatile exchange rates, particularly for £/€.	Liquidity risk was monitored actively throughout the year. In February 2015, the Company secured the availability of additional short-term borrowing facilities (since cancelled) to enable it to continue to invest while awaiting the proceeds of the sale of its investment in Eversholt Rail. Following the exceptional return generated from the realisation of Eversholt Rail, the Board is announcing its intention to implement a £150 million return of capital to shareholders. The Board also agreed the renewal of the Company's revolving credit facility, increasing the amount to £300 million on improved terms. Throughout the year, the Company managed a foreign exchange hedging programme which significantly reduced the impact of the £/€ foreign exchange volatility.
Manage the relationship with the Investment Adviser	Renewal of the Investment Advisory Agreement on acceptable terms and subject to shareholder approval.	The Board maintained an excellent relationship with the Investment Adviser throughout the year. The Chairman had a regular dialogue with 3i Group's Chief Executive to discuss the performance of the investment advisory team. The amendments to the Investment Advisory Agreement were approved at the Company's EGM in July 2014 by an overwhelming majority of the independent shareholders (not including 3i Group).

Cost	£151m
Income received in the period of ownership	£104m
Capital receipts in the period of ownership	£36m
Net realisation proceeds (after transaction costs)	£365m
Gross IRR	>40%
Total return over cost	£354m
Gross money multiple	3.4x

Investment to promote growth over the long term	The Consortium engaged closely with the management team to support the business in the ongoing re-franchising programme and to assess a range of capital investment opportunities, both to add further trains to the overall fleet and to invest in upgrading existing assets to provide better passenger experience and improved reliability, at good value for money for operators. Eversholt Rail was repositioned as an asset management business, capable of renewing its asset base in perpetuity, and not as a lessor of depreciating fleets. Eversholt Rail added to its capabilities through securing a long-term contract to manage the new Thameslink train fleet with the Company's other investment, Cross London Trains.
An efficient capital structure	Eversholt Rail's capital structure was de-risked through the issuance of long-dated public bonds and a private placement, priced on attractive terms, significantly reducing the ongoing debt servicing costs and refinancing risks. The residual acquisition debt was refinanced in November 2013 and November 2014, on attractive terms, which leaves Eversholt Rail in a strong position for future growth.
Separation from HSBC and renewed focus on business	The Consortium worked with the management team to transform Eversholt Rail into a fully functioning stand-alone business, compared to its previous reliance on HSBC. This included developing a full finance function and making further executive appointments to bolster Eversholt Rail's technical, financial and legal resources, positioning it well to manage the significant increase in workload as the pace of rail franchise re-tendering accelerated.
Strong corporate governance and incentive structure	The Consortium strengthened Eversholt Rail's governance through several new appointments to the board, including a new chairman, a highly experienced non-executive director, a CFO and COO and the establishment of audit and remuneration committees with investor representation. In addition, Eversholt Rail's management incentives were restructured post acquisition, with a strong link to the long-term value of the business and returns to shareholders.

	Directors'					Directors'		Underlying	Allocated
	valuation	Investment	Divestment		Foreign	valuation	Profit/	portfolio	foreign	Asset total
	31 March	in the	in the	Value	exchange	31 March	(loss) on	income in	exchange	return in
Portfolio assets	2014	year	year	movement	translation	2015	disposal	the year	hedging	the year
Core infrastructure
Eversholt Rail Group	160.3	5.1¹	(3.9)	198.3	-	359.8	-	31.1	-	229.4
Anglian Water Group	234.5	-	-	7.8	-	242.3	-	10.5	-	18.3
Elenia	235.7	11.0¹	(8.2)	29.5	(29.5)	238.5	(0.1)	19.9	26.4	46.2
Oystercatcher	119.8	-	-	(0.7)	(8.6)	110.5	-	4.3	2.9	(2.1)
Cross London Trains	64.0	-	-	35.8	-	99.8	-	4.8	-	40.6
	814.3	16.1	(12.1)	270.7	(38.1)	1,050.9	(0.1)	70.6	29.3	332.4
Primary PPP
Mersey Gateway Bridge	-	-	-	-	-	-	-	0.2	-	0.2
Ayrshire College	-	-	-	-	-	-	-	0.8	-	0.8
A12	-	-	-	-	-	-	-	0.1	-	0.1
A9	-	-	-	-	-	-	-	0.1	-	0.1
La Santé	-	-	-	-	-	-	-	0.1	-	0.1
RIVM	-	-	-	-	-	-	-	0.2	-	0.2
	-	0.1	-	-	-	0.1	-	1.5	-	1.5
Operational PPP
Elgin	46.8	-	(0.1)	(2.0)	-	44.7	-	2.8	-	0.8
Octagon	42.6	-	-	(0.4)	-	42.2	-	3.2	-	2.8
Dalmore	15.6	0.2	-	1.6	-	17.4	-	1.0	-	2.6
NMM	2.8	2.4	-	-	(0.6)	4.6	-	0.4	0.5	0.3
	107.8	2.6	(0.1)	(0.8)	(0.6)	108.9	-	7.4	0.5	6.5

3i India Infrastructure Fund	73.9	-	(9.2)	(6.3)	4.8	63.2	1.0	-	-	(0.5)

Total portfolio	996.0	18.8	(21.4)	263.6	(33.9)	1,223.1	0.9	79.5	29.8	339.9
Balance sheet adjustments related to unconsolidated subsidiaries²	0.6	-	1.0	6.8	-	8.4	-	-	-	-
Income statement adjustments related to unconsolidated subsidiaries²	-	-	-	-	-	-	13.6	(19.9)	(5.1)	(4.6)
Reported in the Consolidated financial statements	996.6	18.8	(20.4)	236.5	-	1,231.5	14.5	59.6	24.7	335.3

Table 2 Reconciliation of the movements in portfolio value (year to 31 March 2015, £m)
Opening portfolio value at 1 April 2014	996.0
Net investment	18.8
Divestment/capital repayment	(21.4)
Unrealised value movement - Europe	269.9
Unrealised value movement - India	(6.3)
Exchange movement	(33.9)¹
Closing portfolio value at 31 March 2015	1,223.1

Value movement component	Value movement in the first half of the year	Value movement in the second half of the year	Total value movement for the year	Description
Planned value growth	28.4	(2.4)	26.0	Net value movement resulting from the passage of time, consistent with the discount rate and cash flow assumptions at the beginning of the year, less distributions received in the year.
Asset performance	40.1	140.4	180.5	Net movement arising from actual performance in the year and changes to future cash flow projections, including financing assumptions and changes to regulatory determination assumptions. It also includes uplift to sales basis from last valuation.
Discount rate movement	57.1	73.9	131.0	Value movement relating to changes in the discount rate applied to the valuations.
Macro economic assumptions	(14.5)	(59.4)	(73.9)	Value movement relating to changes to macro economic out-turn or assumptions, eg inflation, interest rates on deposit accounts and taxation rates. This includes changes to regulatory returns that are directly linked to macro economic variables.
Total value movement before exchange	111.1	152.5	263.6
Foreign exchange retranslation	(20.6)	(13.3)	(33.9)	Movement in value due to currency retranslation to year-end rate.
Total value movement	90.5	139.2	229.7

	£/rupee	£/€/SGD	Net impact
Translation of assets £/rupee	4.8		4.8
Translation of assets £/€/SGD		(38.7)	(38.7)
Foreign exchange gains/(losses) on investments	4.8	(38.7)	(33.9)

Movement in the fair value of derivative financial instruments (£/€/SGD hedging)		29.8	29.8
Net foreign exchange gains/(losses)	4.8	(8.9)	(4.1)

			Notes	2015 £m	2014 £m
Assets
Non-current assets
Investments at fair value through profit or loss			3	1,231.5	996.6
Investment portfolio				1,231.5	996.6
Derivative financial instruments				24.4	2.5
Total non-current assets				1,255.9	999.1
Current assets
Trade and other receivables				13.0	12.7
Derivative financial instruments				11.9	2.3
Other financial assets				33.9	13.1
Cash and cash equivalents				72.5	90.7
Total current assets				131.3	118.8
Total assets				1,387.2	1,117.9
Liabilities
Non-current liabilities
Derivative financial instruments				(6.0)	(2.1)
Trade and other payables				(0.5)	-
Total non-current liabilities				(6.5)	(2.1)
Current liabilities
Trade and other payables				(52.8)	(1.9)
Derivative financial instruments				(6.6)	(0.1)
Total current liabilities				(59.4)	(2.0)
Total liabilities				(65.9)	(4.1)
Net assets				1,321.3	1,113.8
Equity
Stated capital account				181.6	181.6
Retained reserves				1,139.7	932.2
Total equity				1,321.3	1,113.8
Net asset value per share
	Basic and diluted (pence)	4		149.9	126.4

	Year to	Year to
	31 March	31 March
	2015	2014
	£m	£m
Cash flow from operating activities
Purchase of investments	(2.6)	(67.8)
Investment in other financial assets	(22.1)	(13.1)
Proceeds from partial realisations of investments	26.8	25.2
Investment income	49.5	56.5
Fees received on investment activities	1.4	1.1
Fees paid on investment activities	(1.8)	(1.0)
Operating expenses paid	(2.6)	(2.3)
Interest received	0.3	0.4
Advisory and performance fees paid	(10.3)	(10.9)
Carried interest paid	-	(1.4)
Temporary loan repaid to unconsolidated subsidiaries	-	(7.2)
Other income received	1.2	0.2
Net cash flow from operations	39.8	(20.3)
Cash flow from financing activities
Amounts received on the settlement of derivative contracts	5.1	0.5
Amounts paid on the settlement of derivative contracts	(0.9)	(0.7)
Fees paid on financing activities	(2.9)	(4.1)
Dividends paid	(59.3)	(60.5)
Net cash flow from financing activities	(58.0)	(64.8)

Change in cash and cash equivalents	(18.2)	(85.1)
Cash and cash equivalents at the beginning of the year	90.7	175.8
Cash and cash equivalents at the end of the year	72.5	90.7

	UK and	Continental	Asia	Total
	Ireland¹	Europe²
For the year to 31 March 2015	£m	£m	£m	£m
Investment return
Realised gains/(losses) over fair value on the disposal of investments	13.7	(0.1)	0.9	14.5
Net movement on investments at fair value through profit or loss	242.8	(4.8)	(1.5)	236.5
Investment income	32.1	26.0	-	58.1
Net fees payable on investment activities	(4.6)	-	-	(4.6)
Interest receivable	0.3	-	-	0.3
Investment return/(loss)	284.3	21.1	(0.6)	304.8
Finance costs	(3.2)	-	-	(3.2)
Other net expenses	(27.9)	(6.9)	-	(34.8)
Profit/(loss) before tax	253.2	14.2	(0.6)	266.8
As at 31 March 2015
Balance sheet
Investments at fair value through profit or loss	806.1	358.8	66.6	1,231.5
Cash and cash equivalents	72.5	-	-	72.5
Other financial assets	17.7	16.2	-	33.9
Derivative financial instruments	36.3	-	-	36.3
Other assets	8.8	4.2	-	13.0
Assets	941.4	379.2	66.6	1,387.2
Derivative financial instruments	(8.1)	(4.5)	-	(12.6)
Other liabilities	(52.6)	(0.7)	-	(53.3)
Liabilities	(60.7)	(5.2)	-	(65.9)
Net assets	880.7	374.0	66.6	1,321.3

Table 5 Portfolio weighted average discount rate (31 March 2015, %)
March 2008	12.4
March 2009	13.8
March 2010	12.5
March 2011	13.2
March 2012	12.6
March 2013	12.0
March 2014	11.8
March 2015	10.2

Table 6 Portfolio asset returns throughout holding period (since inception, £m)
		Value
		including
		accrued income/	Proceeds on
	Total	accrued disposal	disposals/	Cash
Existing portfolio	cost	proceeds	capital returns	income
Eversholt¹	151	364	36	104
AWG	173	243	12	127
Elenia	195	240	-	49
Oystercatcher	85	110	-	68
Cross London Trains	62	101	-	8
Existing PPP portfolio	80	110	1	39
3i India Infrastructure Fund	107	66	8	-
Realised assets
Realised PPP assets	173	-	250	22
Junior debt portfolio	120	-	135	24
T2C and Novera	18	-	10	-
1 Sale completed in April 2015. 17% Annualised asset IRR from inception to 31 March 2015.

1	Reconciliation of measure to the Financial statement balances is set out in Table 9.
2	Includes cash balances of £75.4 million and £184.2 million undrawn balances available under the £200 million revolving credit facility, prior to the renewal of the facility on 7 May 2015.

Table 7 Summary total return (year to 31 March 2015, £m)
			Adjustments for
		Underlying portfolio	transactions in
		asset aggregate	unconsolidated	Financial
		returns and costs	subsidiaries	statements
Capital return		230.6	20.4^1,2,3	251.0
Movement in fair value of derivatives		29.8	(5.1)¹	24.7
Total income		79.8	(19.9)²	59.9
		340.2	(4.6)	335.6

Costs		(72.8)	4.7³	(68.1)
Other net income/(costs)		(0.6)	(0.1)	(0.7)
Total return		266.8	─	266.8
1	Movement in fair value of derivatives relating to hedging specific to the Oystercatcher subsidiary, reclassified as capital return, to reflect the fact it is monitored by the Board as part of the unrealised value movement in Oystercatcher.
2	Income generated from underlying portfolio assets which has, subsequently, not been distributed from an intermediate unconsolidated holding company as an income distribution and is therefore reflected as a capital profit. The adjustment reclassifies a capital return of £19.9 million as income, to reflect the nature of the original source of the return, as monitored by the Board. This principally relates to a dividend of £15.5 million received from Eversholt Rail.
3	Costs of £4.7 million were incurred within unconsolidated subsidiaries, comprising fees paid directly to 3i Group (£4.2 million), operating expenses (£0.3 million) and transaction fees (£0.2 million). These are reflected in capital returns or income as they have reduced either the carrying value, or the income distributed from these subsidiaries.

	2015	2014
	£m	£m
Investment Adviser's fee	15.2	14.0
Auditors' fee	0.2	0.2
Directors' fees and expenses	0.4	0.4
Other ongoing costs	2.0	1.7
Total ongoing charges	17.8	16.3
Ongoing charges ratio	1.47%	1.48%

Opening NAV at 1 April 2014¹	1,084.3
Capital return - Europe	269.8
Capital return - India	(5.3)
Net foreign exchange movement²	(4.1)
Income including interest receivable	79.8
Total costs including advisory and performance fee	(73.4)
NAV before distributions	1,351.1
Distribution to shareholders³	(61.7)
Closing NAV at 31 March 2015	1,289.4

1	Net of final dividend for the prior year.
2	Foreign exchange movements are described in Table 4.
3	Includes interim and final dividend payments but does not reflect the special dividend to be made in July 2015.

Table 9 Summary balance sheet (as at 31 March 2015, £m)
		Adjustments for
	Underlying aggregate	transactions in
	portfolio amounts and	unconsolidated	Financial
	other balances	subsidiaries¹	statements
Portfolio assets	1,223.1	8.4	1,231.5²
Cash balances	75.4	(2.9)³	72.5
Financial assets	33.9	-	33.9
Derivative financial instruments	28.2	(4.5)⁴	23.7
Other net liabilities	(39.3)	(1.0)	(40.3)
Net asset value	1,321.3	-	1,321.3

1	"Investments at fair value through profit and loss" in the statutory Financial statements includes £2.9 million of unrestricted cash balances and £1.0 million of other net assets within intermediate unconsolidated holding companies and a £4.5 million re-classification of derivative liabilities relating to the Oystercatcher subsidiary. These adjustments reclassify these balances to show the underlying value of the portfolio assets, the total cash holdings and the derivative and other net assets/(liabilities) position, as monitored by the Board.
2	Described as "Investments at fair value through profit and loss" in the Financial Statements.
3	Cash balances held in unconsolidated subsidiaries totalled £2.9 million.
4	A £4.5 million derivative liability relating to hedging specific to the Oystercatcher subsidiary, re-classified as Portfolio assets, to reflect the fact that it is monitored by the Board as part of the valuation of Oystercatcher.

	Board
	§ Assesses the Company's risk appetite as part of its regular reviews of market conditions and strategy § Has overall responsibility for maintaining a system of internal controls that ensures effective risk management and oversight processes

Board/Investment Committee	Audit and Risk Committee	Management Engagement Committee
§ Receives reports from the Investment Adviser on the performance of portfolio companies, including an assessment of key risks and actions implemented to mitigate them § Assesses investment and divestment proposals from the Investment Adviser, with considerations given to their impact on portfolio performance and long-term returns	§ Receives reports from the Investment Adviser and other key service providers on the implementation of risk management processes and systems of internal control § Receives reports from the Investment Adviser and other key service providers on regulatory and compliance matters	§ Monitors and assesses the performance of the Investment Adviser

Key risk factors	Risk description	Risk mitigation
External
Macroeconomic risk	§ Limited growth or reduction in NAV, or reduction of portfolio income levels owing to adverse market conditions for the Company's portfolio assets § Impact on investment rates	§ Modelling of sensitivity of each investment to macroeconomic variables § Regular reviews of hedging undertaken where appropriate § Diversification of the portfolio across a range of infrastructure sectors with different economic cycles and across different geographies
Market risk	§ Impact on portfolio company valuations § Impact on investment rates should market projected returns be inconsistent with the Company's return objectives	§ Regular monitoring of infrastructure market transactions and implied valuations and alignment of the Company's return objectives to market returns § Leveraging Investment Adviser's network to find attractive investment opportunities
Geopolitical risk	§ Impacts general market confidence, bond yields in certain geographies and projected returns in certain asset classes	§ Periodic legal and regulatory updates on the Company's markets and in-depth market and sector research § Extensive research and due diligence on any proposed investment in new markets § Reports on the India Fund's portfolio performance including proposed actions by the Investment Adviser
Government policy and regulatory risk	§ Non-compliance with applicable regulations impacts the Company's ability to operate effectively § Changes in regulation also affect the performance of the underlying portfolio	§ Changes to applicable legal and regulatory frameworks for the Company and each of the portfolio assets are closely monitored § Rigorous processes to minimise risk of breach are in place § Regular monitoring of compliance with relevant regulations is undertaken by the Company and Investment Adviser
Financial
Currency risk	§ Unhedged foreign exchange rate movements impact total return and NAV § Underlying portfolio companies are also exposed to currency risks. Where appropriate, they also need to implement foreign currency hedging policies to manage this risk	§ The Company's euro and Singapore dollar exposure is broadly hedged to stabilise returns using foreign exchange swaps or forward contracts (note that the exposure to the Indian rupee is unhedged) § The hedging strategy is monitored regularly by the Board § Underlying portfolio company hedging policies are monitored by the Investment Adviser to ensure their adequacy
Financing and interest rate risk	§ This affects: − The cost of servicing the Company's debt − The ability of portfolio companies to finance themselves efficiently − The ability to generate attractive returns from investments − The ability to invest in competition with buyers with a lower cost of debt − The debt financing capabilities of portfolio companies − The rate of return of the Company's liquid assets	§ Debt levels, refinancing risk and hedging requirements in underlying portfolio companies are monitored regularly § Financing strategy limits the Company's borrowings to 50% of gross assets. The Company currently has net cash § The use of a combination of fixed and floating rate debt in portfolio companies reduces interest rate risk § Hedging is undertaken where appropriate to manage interest rate risk
Liquidity risk	§ Impacts the Company's ability to fund its investment pipeline § Holding excessive cash balances has a negative impact on returns	§ The Board regularly analyses cash resources against the investment pipeline and the repayment of existing financial liabilities or other payables
Credit risk	§ Debt availability is fundamental to completing new investments and financing capital expenditure in several portfolio assets	§ Regular portfolio monitoring provides early indications of increased credit risk § The Company's financial assets are held in AAA-rated money market funds or short-term deposits with banks with a minimum A rating § Reviews of counterparties and counterparty limits undertaken regularly
Investment
Investment decision risk	§ Poor investment decisions impact longer-term returns § Poor investment performance negatively affects the attractiveness of the Company as a co-investment or financial partner	§ Investment prospects subject to thorough review processes by the Investment Adviser § Thorough review undertaken by the Board prior to the final investment decision
Investment performance risk	§ Impacts capital and income returns from portfolio assets	§ Formal portfolio asset reviews, which include the assessment of environmental, social and regulatory/operating environment risks, are undertaken regularly and reviewed bi-annually by the Board § The Investment Adviser represents the Company on the boards of portfolio companies
Investment concentration risk	§ Over-exposure to adverse developments in a particular sector or geography	§ No new investment should represent more than 20% of the portfolio at the time of investment. The Board has proposed to increase this limit to 25%, subject to shareholder approval in July 2015 § Portfolio concentration measures are reviewed periodically by the Board § The Investment Adviser undertakes a concentration review for each new investment
Strategic
Business strategy risk	§ Deviations from the assumptions factored into the Company's strategy and business model could affect its performance and financial position	§ KPIs and forecasts are monitored on an ongoing basis and the Board undertakes regular strategic reviews, including the review of the relevance and adequacy of the KPIs § Plans and underlying assumptions for the Company and portfolio assets are updated continuously
Operational
Exposure to the loss of key members of the investment advisory team	§ Inability to deliver strategic plan § Potential to undermine investor and/or shareholder confidence	§ The Board monitors the performance of the Investment Adviser through the Management Engagement Committee and the Chairman has a regular dialogue with the CEO of 3i Group on the performance of the investment advisory team
Inadequate or failed processes and systems, and external factors affecting these processes	§ Ability of the Company to continue to operate effectively	§ The Board monitors the operations of key service providers, and receives reports of any significant internal control breaches § The Company receives regular updates on legal, tax and regulatory matters from its advisers

Cost	£161.9m
Closing value	£242.3m
Equity interest	10.3%
Opening value	£234.5m
Income in the year	£10.5m
Value movement in the year	£7.8m
Asset total return in the year	£18.3m
Valuation basis	DCF

Cost	£194.8m
Closing value	£238.5m
Equity interest	39.3%
Opening value	£235.7m
Net capitalised interest in the year	£2.8m
Income in the year	£19.9m
Value movement in the year	£29.5m
Net exchange movement in the year¹	£(3.1)m
Asset total return in the year	£46.2m
Valuation basis	DCF

Cost	£84.5m
Closing value	£110.5m
Equity interest	45%
Opening value	£119.8m
Income in the year	£4.3m
Value movement in the year	£(0.7)m
Net exchange movement in the year¹	£(5.7)m
Asset total return in the year	£(2.1)m
Valuation basis	DCF

Cost	£61.8m
Closing value	£99.8m
Equity interest	33.3%
Opening value	£64.0m
Income in the year	£4.8m
Value movement in the year	£35.8m
Asset total return in the year	£40.6m
Valuation basis	DCF

Cost	£78.3m
Closing value	£109.0m
Opening value	£107.8m
Investment in the year	£2.7m
Income in the year	£8.9m
Value movement in the year	£(0.8)m
Net exchange movement in the year¹	£(0.1)m
Asset total return in the year	£8.0m
Valuation basis	DCF and LP share of funds for Dalmore

Cost	£91.9m
Closing value	£63.2m
Partnership interest	20.9%
Opening value	£73.9m
Divestment in the year	£9.2m
Capital profit in the year	£1.0m
Value movement in the year	£(6.3)m
Exchange movement in the year	£4.8m
Asset total return in the year	£(0.5)m
Valuation basis	LP share of funds

	Stated		Total
	capital	Retained	shareholders'
	account	reserves	equity
For the year to 31 March 2015	£m	£m	£m
Opening balance at 1 April 2014	181.6	932.2	1,113.8
Total comprehensive income for the year	-	266.8	266.8
Dividends payable to shareholders of the Company during the year	-	(59.3)	(59.3)
Closing balance at 31 March 2015	181.6	1,139.7	1,321.3

	Stated		Total
	capital	Retained	shareholders'
	account	reserves	equity
For the year to 31 March 2014	£m	£m	£m
Opening balance at 1 April 2013	181.6	921.7	1,103.3
Total comprehensive income for the year	-	71.0	71.0
Dividends payable to shareholders of the Company during the year	-	(60.5)	(60.5)
Closing balance at 31 March 2014	181.6	932.2	1,113.8

Level	Fair value input description	Financial instruments
Level 1	Quoted prices (unadjusted and in active markets)	Quoted equity investments
Level 2	Inputs other than quoted prices included in Level 1 that are observable in the market either directly (ie as prices) or indirectly (ie derived from prices)	Derivative financial instruments held at fair value
Level 3	Inputs that are not based on observable market data	Unquoted investments and unlisted managed funds

	As at 31 March 2014
	Level 1	Level 2	Level 3	Total
	£m	£m	£m	£m
Financial assets
Investments at fair value through profit or loss	-	-	996.6	996.6
Derivative financial instruments	-	4.8	-	4.8
	-	4.8	996.6	1,001.4
Financial liabilities
Derivative financial instruments	-	(2.2)	-	(2.2)