Beasley Broadcast Group Annual Report 2021

FY2021 Annual Report · Beasley Broadcast Group

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Annual
Report
2021

Low-risk
investment
Long-term
returns

www.bb-gi.com

Contents

Company Overview
01 Why Invest in BBGI
02 About BBGI
03 Year in Numbers
04 A Decade of Outperformance
06 Portfolio Highlights
07 Portfolio at a Glance
09 Chair’s Statement

Investment Proposition

Strategic report
11 Co-CEO Statement
15
16 Operating Model
18 Portfolio Review
22 Portfolio Snapshot
25 Market Trends and Pipeline
28 Operating and Financial Review
32 Valuation
39 Financial Results
43 Alternative Performance

Measures (‘APM’)

44 ESG (Environment, Social and

Governance)

Front cover:

Women’s College Hospital, Canada

Inside cover:

MerseyLink Gateway Bridge, UK

Corporate Governance
58 Corporate Governance
60 Supervisory Board and
Management Board
61 Biographies of Directors
63 Supervisory Board
65 Management Board
68 Nomination Committee Report
70 Remuneration Committee

Report

72 Remuneration at a Glance
80 Audit Committee Report
83 Viability Statement
84 Risk
91 Administration
92 Management Board

Responsibilities Statement

Financial statements
93 Report on the Audit of the
Consolidated Financial
Statements

96 Consolidated Income

Statement

97 Consolidated Statement of

Other Comprehensive Income

98 Consolidated Statement of

Financial Position

99 Consolidated Statement of

Changes in Equity

100 Consolidated Statement of

Cash Flows

101 Notes to the Consolidated
Financial Statement
137 Report on the Audit of the

Company Financial Statements

140 Company Statement of
Comprehensive Income
141 Company Statement of
Financial Position
142 Company Statement of
Changes in Equity

143 Company Statement of Cash

Flows

144 Notes to the Company
Financial Statement
155 Board Members, Agents &

Advisers

BBGI Global Infrastructure S.A. | Annual Report 2021

BBGI provides access to a diversified portfolio of infrastructure investments that generate attractive long-term, sustainable returns and serve an inherent social purpose in their local communities. Why Invest in BBGI

In return for long-term investment
in, and active ownership of, essential
social infrastructure investments
such as education, healthcare, blue
light, affordable housing, modern
correctional facilities, and transport,
procured using availability-based1
investment models, BBGI receives
stable, predictable and contracted
cash flows with an attractive inflation
linkage. These are underpinned by
government, or government-backed
counterparties.

The predictability of these contracted
revenues allows BBGI to return to
investors an attractive, stable and
progressive income stream in the
form of a semi-annual dividend. The
Management Board follows a proven
operating model of value-driven
active asset management, prudent
financial management and a selective
acquisition strategy to preserve
value and achieve portfolio growth.
Environmental, Social and Governance
(‘ESG’) considerations are embedded
in our business strategy, operations
and investment processes. The
fundamental pillars of the Company
are low-risk, globally diversified and
internally managed investment
strategy and a strong ESG approach.

Low-risk2

The Company is committed to an availability-based social infrastructure investment platform
and this strategy generates stable, predictable inflation-linked cash flows backed by secure,
contracted public sector revenues. This is the Management Board’s area of expertise, and
the Company avoids style drift by maintaining a disciplined approach to this strategy.

Globally diversified

The investment strategy is deployed in stable, well-established developed markets where
governments and local authorities maintain support for availability-based models to finance
public infrastructure. This provides focused exposure to highly-rated investment-grade
countries across the UK, North America, Australia and Continental Europe.

Strong ESG approach

The Company has a values-driven active asset management approach which is aligned to
six UN Sustainable Development Goals (‘SDGs’), and a commitment to net-zero and other
ESG principles which are integrated into the Company’s investment and operating model.
This approach serves to strengthen the non-financial returns the portfolio generates for all
stakeholders. The portfolio also demonstrates a high degree of climate resilience. This enables
the Company to focus on the effective delivery of social impact, and incentivise strong ESG
performance by directly linking results to executive compensation.

Internally managed

The Company’s in-house management team is focused on delivering shareholder
value, incentivised by shareholder returns and growth in Net Asset Value (‘NAV’)
per share. This means that no NAV-based management or acquisition fees are
charged, and the internal management team’s interests are fully aligned with those
of the shareholders, resulting in pricing discipline when managing the portfolio and
assessing investment opportunities. As a result, the Company consistently maintains
the lowest comparative ongoing charges to its shareholders in the sector3.

Investments where payments received by the portfolio companies from the public sector client and hence the revenue streams from the investments do not generally
depend on the level of use of the project asset, and as such are ‘availability-based’.

2 References to ‘low-risk’ throughout this Annual Report are made in comparison to equity investments in other infrastructure asset classes.
In comparison to the latest publicly-available information for all closed-ended, LSE-listed equity infrastructure investment companies.
3

Cautionary Statement
Certain sections of this Annual Report, including but not
limited to the Chair’s Statement and the Strategic Report of
the Management Board, have been prepared solely to provide
additional information to shareholders to assess the Group’s
strategies and the potential for those strategies to succeed.
This additional information should not be relied on by any
other party or for any other purpose.

These sections may include statements that are, or may be
deemed to be, ‘forward-looking statements’. These forward-
looking statements can be identified by the use of forward-
looking terminology, including the terms ‘believes’, ‘estimates’,
‘anticipates’, ‘forecasts’, ‘projects’, ‘expects’, ‘intends’, ‘may’,
‘will’ or ‘should’ or, in each case, their negative or other
variations or comparable terminology.

These forward-looking statements include matters that are not
historical facts. They appear in a number of places throughout
this document and include statements regarding the intentions,
beliefs or current expectations of the Management and
Supervisory Boards concerning, amongst other things, the
investment objectives and investment policy, financing
strategies, investment performance, results of operations,
financial condition, liquidity, prospects and distribution policy
of the Group, and the markets in which it invests.

By their nature, forward-looking statements involve risks
and uncertainties because they relate to events and depend
on circumstances that may or may not occur in the future.
Forward-looking statements are not a guarantee of future
performance. The Group’s actual investment performance,
results of operations, financial condition, liquidity, distribution
policy and the development of its financing strategies may
differ materially from the impression created by the forward-
looking statements contained in this document.

Subject to their legal and regulatory obligations, the
Management and Supervisory Boards expressly disclaim any
obligations to update or revise any forward-looking statement
contained herein to reflect any change in expectations
with regard thereto or any change in events, conditions or
circumstances on which any statement is based.

In addition, these sections may include target figures and
guidance for future financial periods. Any such figures are
targets only and are not forecasts.

This report has been prepared for the Group as a whole
and therefore gives greater emphasis to those matters that
are significant to BBGI Global Infrastructure S.A. and its
subsidiaries when viewed as a whole.

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTCORPORATE GOVERNANCEFINANCIAL STATEMENTSAbout BBGI

BBGI Global Infrastructure S.A.
(BBGI, the ‘Company’, and together
with its subsidiaries, the ‘Group’) is a
global infrastructure investment
company, providing responsible
capital to build and maintain critical
social infrastructure4 in the countries
where we do business.

Lagan College, UK

These are the important
infrastructure assets on which
citizens rely every day. They are the
building blocks of the local economy,
and as a long-term custodian, we
partner with the public sector to help
deliver and manage these assets.

In doing so, we follow a low-risk,
globally diversified and internally
managed investment strategy with a
strong ESG approach to deliver
attractive long-term and predictable
shareholder returns.

4 Social infrastructure include education, healthcare, blue light (fire and police),

affordable housing, modern correctional facilities and transport.
In exchange for the provision of these assets and services, BBGI receives a
revenue stream that is paid directly by the public sector.

BBGI Global Infrastructure S.A. | Annual Report 2021

Year in Numbers

Financial highlights

Investment Basis NAV

NAV per Share

up 9.4% as at 31 December 2021 (31 December 2020: £916.0 million)5

up 2.1% as at 31 December 2021 (31 December 2020: 137.8pps)

£1,001.6m

140.7pps

Total Shareholder Return
(‘TSR’)

since IPO5

171%

Annualised Total
Shareholder Return

since IPO5

10.4%

2021 Dividend declared
per Share

7.33pps

2022 Target Dividend5

2023 Target Dividend

2024 Target Dividend

7.48pps

7.63pps

7.78pps

Cash Dividend Cover5

1.31x

Ongoing Charges5

(2020: 0.86%)

0.86%

Five-year Beta5

(2020: 0.24%)

0.25%

5 Refer to the Alternative Performance Measurement section of this Annual Report for further details.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTA Decade of Outperformance

Connecting communities and delivering vital public services
via long-term, responsible global infrastructure investment.

As the Company marks its tenth anniversary
since its initial public offering (‘IPO’), our
decade in numbers quantifies our ability to
deliver attractive, stable, predictable returns
from a globally diversified portfolio of essential
social infrastructure investments.

Fast-forward a decade, the Company has
successfully grown and diversified its portfolio
while maintaining strategic discipline in our
acquisition strategy and portfolio composition,
creating sustainable, long-term benefits and
value for all our stakeholders.

2011 – 2021

Net Asset Value

383%

NAV growth from £207.6 million to
£1,001.6 million since IPO

Average annual
dividend increase
since IPO

3.3%

Annualised NAV
growth
Increase since IPO

17.0%

Net Asset Value

44%

Increase in NAV per share from 98
0pps to 140.7pps6 since IPO

Total Shareholder Return
(‘TSR’)
since IPO

171%

Annualised NAV
per share
Increase since IPO

3.7%

Track
record

100%

in meeting declared dividend target

Average Asset
availability rate8

99.8%

6 Pence per share (‘pps’)
7 Calculated using year end 31 December 2012 data, which was the Company’s first full year of operations.
8 Based on data available for the years 2017 to 2021.

BBGI Global Infrastructure S.A. | Annual Report 2021

No of Assets

The number of assets
selectively acquired

Reduction in
ongoing charge

40%

From 1.44% to 0.86%7

Annualised Total
Shareholder Return
Increase since IPO

10.4%

Total dividend
growth7

33%

As the Company
marks its tenth
anniversary since its initial
public offering (‘IPO’),
our decade in numbers
quantifies our ability to
deliver attractive, stable,
predictable returns

William R Bennett Bridge, Canada

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTCORPORATE GOVERNANCEFINANCIAL STATEMENTSPortfolio Highlights

MerseyLink Gateway Bridge, UK (Credit: Andy Light)

– Globally diversified portfolio

of 54 high-quality investments
generating predictable cash
flows ahead of forecast.

– 100% availability-based

infrastructure investments.

– Attractive inflation linkage and

strong dividend cover.

– Active management activities
contributed to 1.4 per cent.
increase in the Company’s NAV.

– Consistently high levels of asset
availability at 99.98 per cent. with
no material lockups or defaults
reported.

– Broad range of ESG initiatives

progressed that are embedded
into our business strategy and
practices.

– High degree of climate resilience
both today and under different
climate warming scenarios. These
findings followed a formal climate
risk assessment undertaken for
our entire portfolio to better
understand the impact of climate
risk on our Company.

– £79.2 million of accretive cash

investments completed in 2021.
In addition, the Company signed
an acquisition agreement in
October 2021 for an interest in
a healthcare asset in Canada for
a price of c. £51 million, subject
to certain adjustments, and
completed an additional £24
million investment in a clean
energy infrastructure asset in
Canada in February 20229.

– Oversubscribed equity issue

in July 2021 which raised gross
proceeds of £75 million.

– Net cash position of £26.9 million
on an investment basis with no
cash borrowings outstanding
under the Revolving Credit
Facility (‘RCF’)10.

– A pipeline of availability-based
assets that remains strong and
attractive within the Company’s
key markets in Europe and North
America including a strategic
investment partnership via right
of first offer.

8 Based on data available for the years 2017 to 2021.
9 Following the acquisition of the clean energy infrastructure asset in Canada in February 2022, the portfolio has increased to 55 high-quality, 100% availability-based

infrastructure investments.

10 As at 31 December 2021, excluding the cash required for the Canadian Healthcare and Canadian Clean Energy investments.

BBGI Global Infrastructure S.A. | Annual Report 2021

Portfolio at a Glance

The fundamentals
Based on portfolio value as at 31 December 2021.

Investment type

Investment status

Geographical split

100% availability-based revenue stream.

Low-risk operational portfolio.

Geographically diversified in stable
developed countries.



Availability-Based Revenue
Assets 100%




Operations 99.5%

Construction 0.5%

UK 33%

Canada 36%



 Australia 11%

 Continental Europe 9%

US 11%

Sector split

Investment life

Top five investments

Well-diversified sector exposure with large
allocation to lower-risk availability-based
road and bridge investments.

Long investment life with 61% of portfolio
by value with a duration of greater than 20
years; weighted average life of 20.3 years.
Average portfolio debt maturity of 17.3 years.

Well-diversified portfolio with no major
single asset exposure.






Transport 52%

Healthcare 22%

Blue Light and Modern
Correctional Facilities 13%

Education 9%


 Affordable Housing 3%
 Other 1%






≥25 years 20%

≥20 years and <25 years 41%

≥10 years and <20 years 32%

<10 years 7%



Ohio River Bridges
(US) 11%

Golden Ears Bridge
(Canada) 9%

Northern Territory Secure
Facilities (Australia) 6%

McGill University Health
Centre (Canada) 5%

Victoria Correctional
Facilities (Australia) 4%

Next five largest
investments 17%

 Remaining investments 48%

Investment ownership

Country rating

81% of assets by value in the portfolio are
50% owned or greater.

All assets located in countries with ratings
between AA and AAA11.






100% 48%

≥75% and <100% 5%

≥50% and <75% 28%

<50% 19%

AAA 56%



 AA 33%

AA+ 11%

11 Source: Standard & Poor’s credit ratings.

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTCORPORATE GOVERNANCEFINANCIAL STATEMENTS

Portfolio at a Glance continued

Projected portfolio cash flow

The portfolio has a steady stream of portfolio
cash flows until 2051 deriving from the
Company’s underlying assets12. The cash flows
are stable and long-term, with their predictability
enhanced by government or government-
backed counterparties as well as their contracted
nature. The contractual, index-linked provisions
which adjust annually provide a positive link to
inflation of approximately 0.44 per cent13. for
every one per cent. increase in inflation.

The investments made over the year ended 31
December 2021 contributed positively to both
stable cash flows and the weighted average
length of the portfolio. Based on current
forecasts and assuming no further increase in the
Company’s share capital, the existing portfolio
will enter into the capital repayment phase in the
second half of 2035, at which point the nominal
value of future portfolio distributions would
equate to the share capital of the Company.

Income Phase

Capital Repayment Phase

By acquiring accretive investments, the intention
is that the capital repayment phase is pushed
further into the future.

As at 31 December 2021, BBGI has a weighted
average portfolio life of 20.3 years, a decrease
of 0.1 year compared with 31 December 2020.

)

m
£
(
s
w
o
l
f
h
s
a
C

150

125

100

 Illustrative cash flows

(excluding assets acquired
since 1 January 2021)

 Illustrative cash flows

(assets acquired
since 1 January 2021)

2 0 21

2 0 22

2 0 23

2 0 24

2 0 25

2 0 26

2 0 27

2 0 28

2 0 29

2 0 3 0

2 0 31

2 0 32

2 0 33

2 0 34

2 0 35

2 0 36

2 0 37

2 0 38

2 0 39

2 0 4 0

2 0 41

2 0 42

2 0 43

2 0 4 4

2 0 45

2 0 46

2 0 47

2 0 48

2 0 49

2 0 5 0

2 0 51

12 This illustrative chart is a target only, as at 31 December 2021, and is not a profit forecast. There can be no assurance that this target will be met. The hypothetical target

cash flows do not consider any unforeseen costs, expenses or other factors which may affect the portfolio investments and therefore the impact on the cash flows to the
Company. As such, the graph above should not, in any way, be construed as forecasting the actual cash flows or actual returns from the portfolio.

13 Calculated by running a ‘plus 1%’ inflation sensitivity on the portfolio cash flows and solving the portfolio discount rate to return the original portfolio valuation. The inflation-

linked return is the increase above the portfolio weighted average discount rate.

Total 54 assets

Norway USA

Netherlands
Australia

Germany

United Kingdom

Canada

United Kingdom

Netherlands

25 assets

3 assets

Norway

1 asset

USA

1 asset

Canada

15 assets

Germany

6 assets

Australia

3 assets

BBGI Global Infrastructure S.A. | Annual Report 2021

Chair’s Statement

Dear Shareholders,

Dividend target 2022

On our tenth anniversary
since IPO on the London
Stock Exchange in
December 2011, on behalf of
the Supervisory Board, I am
pleased to report another
year of strong and resilient
financial and operational
performance by our globally
diversified, low-risk
portfolio of essential social
infrastructure investments.

This is thanks to the continued predictability
and quality of our portfolio’s underlying, long-
term, government-backed cash flows and our
approach to active asset management. This
past year’s performance was the culmination
of a decade of strong outperformance which
has seen the Company’s NAV per share grow
by 44 per cent. since IPO, and its dividend
grow by average of 3.3 per cent. per annum.

The Company’s total market capitalisation has
increased five-fold during the last decade and
we are proud to have generated a TSR since
our inception of 171 per cent. or 10.4 per cent.
on an annualised basis - well above the seven
to eight per cent. target set at IPO.

Responsible investor
As responsible stewards of our portfolio, there
are many stakeholders who are impacted
by our actions: users of the facilities in our
portfolio, their communities, employees,
investors, sub-contractors, the environment
and society at large.

Despite the continued challenges of the
COVID-19 pandemic, the Company has
worked tirelessly to support all of our
stakeholders and keep our social infrastructure
assets well maintained and operational during
the reporting period.

We have also progressed several ESG
initiatives that are embedded into our business
strategy and practices. We value the views
of our stakeholders and conducted a formal
materiality assessment to identify matters
that have a direct or indirect impact on our
ability to create, preserve or erode economic,
environmental and social value for BBGI and
our stakeholders.

7.48pps
2.1%

Dividend target 2023

7.63pps
2.0%

Additionally, we have undertaken a formal
climate risk assessment for our entire portfolio
to better understand the impact of climate
risk on our Company. This assessment
demonstrated a high degree of climate
resilience across our asset portfolio, both
today and under different future climate
warming scenarios.

The outcome from this assessment and further
detail of our ESG activities can be found in the
ESG section of this Annual Report.

Stable and predictable cash flows
Over the past decade, the Company has
grown its low-risk investment portfolio from 19
assets at IPO to 54 assets as at the year-end.
It has done so in a disciplined manner without
engaging in any style drift, building a well-
constructed portfolio which is aligned with six
of the UN Sustainable Development Goals.

For 2021, the portfolio’s distributions
exceeded year-end internal forecasts with the
NAV increasing by 9.4 per cent. to £1,001.6
million and the NAV per share increasing by 2.1
per cent. to 140.7 pence.

Progressive long-term dividend growth
I am also pleased to report the Company has
met its full-year dividend target of 7.33pps.
This strong performance and the long-term
predictable nature of the Company’s cash
flows gives us confidence in reaffirming our
progressive dividend policy with target dividends
of 7.48pps and 7.63pps for 2022 and 2023,
respectively. We are also pleased to introduce
a new dividend target for 2024 of 7.78pps.

More details about the drivers of the
Company’s financial and operational
performance can be found in our Co-CEO
Statement which follows.

Corporate governance
As we look to the next decade and beyond, our
ESG Committee has ensured the Company
continues to make measurable progress in
managing a full spectrum of ESG considerations,
including working to protect our planet from a
predicted rise in global temperatures.

In line with our ESG principles, the Company
includes ESG metrics in the short-term
incentive plan (‘STIP’) for the Management
Board to ensure that the Company continues
to produce positive non-financial returns.
This year, the Company also introduced a
long-term incentive plan (‘LTIP’) target tied
to reduction in Greenhouse Gas (‘GHG’)
emissions, a key climate related ESG metric
linked to BBGI’s Net Zero Plan.

Supervisory Board changes
The Supervisory Board has a well-developed
succession plan which has seen the Supervisory
Board refresh its membership over the last
decade in line with best practices. I would like
to thank Howard Myles, who, after serving as a
Non-Executive Director of the Company since
the Company’s IPO, will be stepping down at
the 2022 Annual General Meeting (‘AGM’) after
fulfilling his maximum term.

In 2021, Chris Waples was welcomed to the
Supervisory Board as an independent Non-
Executive Director.

The Supervisory Board is looking forward to
welcoming June Aitken and Andrew Sykes
as new members of the Supervisory Board,
with their appointments to be proposed to
shareholders at the 2022 AGM. Following
his appointment, Andrew will be elected
as Howard’s replacement as Chair of the
Remuneration Committee and in addition
will be appointed as a member of the
Nomination and Audit Committees. Andrew
will also take over as Senior Independent
Director. Following her appointment, June
will be elected as a member of each of the
three Committees. Both June and Andrew’s
biographies can be found in the AGM
Convening Notice.

Following these appointments, 60 per cent. of
the Supervisory Board will be female.

New auditor
As disclosed in the 2021 interim report,
after a competitive market tender process,
shareholder approval will be sought to confirm
the appointment of PricewaterhouseCoopers
société cooperative (‘PwC’) as the statutory
auditor for 2022 at the Company’s AGM in
April 2022. Further details of this process are
set out in the Audit Committee report.

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTCORPORATE GOVERNANCEFINANCIAL STATEMENTS
Total acquisitions (new and
follow-on)

79.2m

Asset availability

99.9%

Chair’s Statement continued

Outlook
The future for global infrastructure investment
remains strong. Megatrends such as
urbanisation, flexible working models and the
need to reduce emissions will all contribute
to continued demand for infrastructure
investment. COVID-19 response stimulus
plans in many countries are putting pressure
on governments to step up the pace of
infrastructure development.

The Management Board continues to use
its industry relationships to source attractive
investment opportunities for the Company’s
pipeline, and our internal management
structure creates the proper incentives for the
Management Board to focus on preserving
the value of the Company’s portfolio and
growing the Company in a thoughtful and
disciplined manner, and not be an asset
gatherer focused solely on assets under
management.

This structure has supported much of the
Company’s successes in the past ten years,
and as a result I have full confidence in our
continued ability to create attractive and
sustainable long-term value and benefits for all
our stakeholders.

Post year end, at the time of writing, we are
watching the horrific events unfolding in the
Ukraine. Our thoughts are with the people
of the Ukraine, and all of the people who
are affected by this war. The Company has
no operational, portfolio or geographical
exposure to Russia, Ukraine, and neighbouring
Central and Eastern European regions, but
we are aware of the risks and far-reaching
consequences of the conflict and are
monitoring the situation.

I would like to thank again our employees, our
public sector clients, and our suppliers and
partners who have worked with us over the
past decade to deliver and maintain important
infrastructure projects for local communities
across North America, the UK, Continental
Europe and Australia.

Sarah Whitney
Chair

30 March 2022

BBGI Global Infrastructure S.A. | Annual Report 2021

Co-CEO Statement

Dear Shareholders,

Ten years ago, in 2011,
BBGI went public amidst
the Eurozone debt crisis.
It was the only company to
successfully complete an
IPO on the London Stock
Exchange in the second half
of that tumultuous year.

As we reflect on a decade leading the
Company’s Management Board, the
Company continues to operate much in the
same way it started: an internal management
team solely dedicated to investing responsible
capital in low-risk, public sector-backed,
availability-based social infrastructure assets,
which generate highly predictable cash flows
with an attractive inflation linkage.

During a time of high market uncertainty, much
of BBGI’s initial appeal to investors was based
on the prospect of stable, attractive, predictable
returns from a globally diversified portfolio of
essential social infrastructure investments, and
the alignment of shareholder interests that
came with an internally managed structure.

While our team and the number of assets
in our portfolio have grown, the Company
has maintained its strategic discipline in its
acquisition strategy and portfolio composition,
creating sustainable, long-term benefits and
value for all our stakeholders.

A decade of outperformance
This consistent, disciplined approach has
provided shareholders with a decade of
outperformance. 2021 was no exception.

Since IPO in 2011, our globally diversified
portfolio of infrastructure investments has
grown from 19 to 54 assets at this year-end,
our investment strategy has been consistent
with no style-drift, and our focus on active
asset management and responsible investing
has delivered strong financial results:

– NAV per share has increased from 98pps
at IPO to 140.7pps as at 31 December 2021

– Dividends have increased from 5.5pps to
7.33pps. All dividend targets have been
met since IPO

–

Total dividends declared or paid since IPO
of 64.22pps

Strong dividend cover over the last ten
years

– Annualised total shareholder return of

10.4% since IPO

– Market capitalisation has increased more

than five-fold since IPO

Portfolio performance
Our priority remains to preserve and enhance
the value of the Company’s portfolio and to
continue providing essential infrastructure
services to our public sector clients. Despite
another challenging year due to the COVID-19
pandemic, the portfolio has generated
attractive stable returns and we maintained a
high level of asset availability of 99.9 per cent.
which contributes to client satisfaction.

Our portfolio generated predictable cash
flows ahead of forecast and no material
lock-ups or defaults were reported at any
of the portfolio companies. The portfolio’s
resilience is underpinned by the Company’s
proven business model of investing in low-risk,
availability-based infrastructure in highly-
rated investment grade countries.

This strong performance during a difficult
time would not have been possible without
the dedication of the Company’s employees
who have worked tirelessly to support our
stakeholders.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTCo-CEO Statement continued

Value driven active asset management
During the year, BBGI’s representatives
worked closely with our public sector clients
to ensure the smooth functioning of essential
infrastructure services as we dealt with the
consequences of the Covid pandemic.

Accretive asset management activities
resulted in £13.1 million of value enhancements
over the period and contributed to the strong
portfolio performance. Activities included
successful refinancing transactions, significant
change order revenue and other cost
optimisations. The refinancing transactions
comprised the Ohio River Bridges East End
Crossing investment in the United States and
three additional portfolio companies in the UK
and Canada to capitalise on the low interest
rate and margin environment at the time.

In line with our ESG values, the new bonds
for the Ohio River Bridges East End Crossing
investment align with the four core components
of the Green Bond Principles, and we are proud
of the sustainable infrastructure designation
achieved with this refinancing.

The strong focus on active asset management
and value preservation contributed to an
increase in the Company’s NAV from 137.8pps
to 140.7pps, representing an increase of
2.1 per cent. Cash receipts during the year
were ahead of business plan and allowed the
Company to achieve, once again, a strong
dividend cover of 1.31x.

Dividend cover

1.31x

Dividend guidance
The predictable nature of our cash flows gives
us good visibility for future dividends and the
confidence to extend our dividend guidance to
2024 which is expected to be fully cash-covered.

Dividend target 2022

7.48pps

Dividend target 2023

7.63pps

Dividend target 2024

7.78pps

Low ongoing charge
As an internally managed investment company,
our interests remain fully aligned with those
of our shareholders. The Company has again
maintained the lowest comparative ongoing
charge in our sector at 0.86 per cent14.
through an efficient and cost-effective internal
management structure.

Ongoing charges

0.86%

Selective asset acquisition
During the last ten years, the demand for
the type of infrastructure assets in which the
Company invests has steadily outpaced the
supply, and pricing in the secondary market
has tightened. Despite this environment,
the Company has successfully grown and
diversified the portfolio while maintaining
strategic discipline in our acquisition strategy
and portfolio composition to ensure we
pursue growth that is accretive to shareholder
value, not just for growth’s sake.

This includes maintaining a long weighted
average portfolio life of over 20.3 years and
pursuing new investments with opportunities
for inflation-linkage.

We pride ourselves on our extensive industry
relationships in multiple geographies, ensuring
global portfolio diversification with no reliance
on any one particular market.

As with previous years, the Company
assessed considerably more investments
than it pursued. Using existing cash resources
and an extended multi-currency Revolving
Credit Facility (‘RCF’), the Company invested
approximately £79.2 million which included
interests in four new projects in the UK, all
of which earn availability-based revenue in
return for providing essential public services
in affordable housing, community centres,
mental health facilities, fire and rescue, and
public highways.

All these new investments were screened
for ESG factors including alignment with six
key UN Sustainable Development Goals and
climate-change resiliency.

New investments

£79.2million

More details about these new investments can
be found on page 19.

In comparison to the latest publicly available information for all closed-ended, LSE-listed equity infrastructure
investment companies

15 Based on the portfolio composition on the date the balance sheet hedge contracts are entered into.

BBGI Global Infrastructure S.A. | Annual Report 2021

Prudent financial management
We continued to manage the portfolio
prudently and as at 31 December 2021, the
Group had, on an Investment Basis, a net
cash position of £26.9 million with no cash
borrowings under the RCF.

As a principle, to limit cash drag, the Company
maintains modest cash balances and draws
on its RCF to finance new acquisitions. In May
2021, the Company secured the amendment
and restatement of the RCF, increasing the
committed amount to £230 million, and
extending the maturity to 2026. Furthermore,
the Company has the possibility of increasing
the quantum to £300 million by means of an
accordion provision.

Our proven approach to using the RCF and
repaying it with the proceeds of an equity
capital raise, not only gives shareholders
maximum certainty of securing our pipeline,
but also enables the Company to manage
market liquidity risk, by maintaining adequate
cash and cash equivalents for day-to-day and
medium to long-term capital needs.

We would like to again thank our existing
and new shareholders for their support in our
significantly over-subscribed capital raise of
£75 million in July 2021, the proceeds of which
were used to repay outstanding borrowings
under the RCF.

BBGI is exposed to foreign-exchange volatility
and has implemented a hedging strategy to
mitigate this risk. It uses forward currency
swaps to (i) hedge 100 per cent. of forecasted
cash flows over the next four years on an
annual rolling basis and (ii) to implement
balance sheet hedging in order to limit the
decrease in the NAV to approximately three
per cent. for a 10 per cent. adverse movement
in foreign exchange rates15.

Attractive inflation linkage
BBGI’s equity cash flows are positively
correlated to inflation at c. 0.44. This means
that if long-term inflation were to be one per
cent. higher than the Company’s assumptions
for all future periods, all other things being
equal, the Company’s returns would increase
from 6.55% to 6.99%.

This inflation linkage is achieved through
contractual indexation mechanics in the various
project agreements with the public sector
clients at the portfolio companies, and the
inflation adjustment updated at least annually.

BBGI has not increased its macroeconomic
assumptions in relation to inflation rates,
and this is consistent with the approach we
have taken over the last ten years, including
the years with low or deflationary pressures.
However, if the current forecasts persist the
Company will review the appropriateness of
its inflation assumptions and may introduce a
short-term inflation forecast.

Co-CEO Statement continued

Risk monitoring and management
COVID-19 Risk
We are pleased to report that during the year,
there were no material financial or operational
impacts experienced due to COVID-19.

With most of the Company’s staff working
remotely during much of 2021, IT security and
additional management emphasis on mental
health were key areas of focus.

Counterparty Risk
Asset-level service-delivery obligations are
typically passed down to facility maintenance
contractors for accommodation investments
or operations, and maintenance contractors
for transport assets. A risk can arise to the
extent that the supply-chain partners are
unable to deliver their contractual obligations.
The ongoing assessment and management
of the Company’s counterparty exposures
remains a key focus for BBGI.

The Company benefits from a diversified
contractor base and supply chain with
no concentrated exposure, and despite
the challenges of the global pandemic,
contractors have continued to perform in line
with expectations.

The Company continued to monitor potential
concentration risk and failure of operational
and maintenance contractors who provide
counterparty services to the portfolio
companies. We have not identified any
material risk exposure and the Management
Board remains comfortable with the current
supply-chain partners.

Sustainability Risk
Considerable time was devoted to assessing
sustainability risk. We integrate and appraise
material sustainability risks in our investment
processes in several ways. Alongside traditional
financial criteria, we systematically consider
whether – and to what extent – financially
material sustainability risks might meaningfully
impact our investments.

The Management Board also worked with a
third-party specialist firm to undertake an in-
depth climate risk assessment to model how our
portfolio would react to eight different climate
perils and three global temperature rise scenarios
of 1.5, 3 and 4 degrees Celsius over various time
horizons. In addition to the aforementioned
physical risks from climate change, the Company
is currently monitoring and assessing transition
risk for all assets in the portfolio.

Risks arising from adverse climate change
scenarios are typically mitigated through
insurance coverage, pass-down to
subcontractors, or public sector client relief
events. Findings demonstrate a high degree

of climate resilience across our asset portfolio,
both today and under different climate
warming scenarios. Although climate change
is projected to increase physical risk impacts
across our portfolio, many of our assets, due
to the vital services they provide, have been
designed and constructed in consideration
of potential physical risk impacts and thus are
inherently more resilient to climate change.

Macroeconomic changes
Inflation has increased in all jurisdictions
across BBGI’s geographies and interest rates
are expected to rise from historical lows.
Should long-term interest rates substantially
rise, discount rates may well be affected. It is
reasonable to assume that if discount rates
increase, then deposit rates and inflation rates
would increase as well. A sensitivity is provided
in the Valuation section of this Annual Report to
illustrate the effect of this combined movement
on the Company’s NAV, in a scenario where we
experience discount, inflation and deposit rates
rises across the portfolio.

The Russian invasion of Ukraine, post
period-end, is also creating volatility in the
global markets. While the Company has
no operational, portfolio or geographical
exposure to Russia, Ukraine or neighbouring
Central and Eastern European regions, the
impacts are being felt around the world, in
particular as commodities’ prices and inflation
are pushed upwards.

LIBOR/SONIA transition
In 2017, the UK Financial Conduct Authority
(‘FCA’) announced that the underlying
markets from which the London Interbank
Offered Rate (‘LIBOR’) is derived were no
longer considered appropriate to offer a
sustainable interest rate benchmark, and
determined that this benchmark would be
discontinued with effect from 31 December
2021 and be replaced with the pounds
Sterling Overnight Index Average (‘SONIA’).
The transition from LIBOR to SONIA is not
expected to have a material adverse financial
effect on the Company.

Within the BBGI portfolio, there are 16
investments that have LIBOR exposure.
As of the date of publishing this report, the
Company had made significant progress
and, with the exception of four investments,
all remaining investments have transitioned
to SONIA or are awaiting client consent. The
remaining four investments are scheduled
to transition in the near term and we do not
expect any material risk to arise.

Further details regarding the Company’s
approach to risk management can be found in
the Risk section of this Annual Report.

Cyber-Risk
Cyber-attacks, which are increasingly
common, come in many forms and may
have different motivations (political, criminal
extortion etc.) In a typical public private
partnership (‘PPP’) structure, the public
sector client has its own IT systems and the
vast majority of our Portfolio Companies
do not maintain their own IT systems.
Subcontractors of the Portfolio Company
such as management service providers, facility
maintenance contractors for accommodation
investments and operations and maintenance
contractors for transport assets, will have
their own IT systems, which will likely house
data relating to the project. Typically, risks are
passed down to subcontractors by the project
entity. This would include risks in respect to
design and construction warranties relating to
IT systems (such as a warranty that the system
will meet specifications requiring it to meet
robust security requirements), as well as the
risk where a cyber-attack would interrupt the
provision of services to the project. Refer to
the Risk section of this Annual Report for more
detail on cyber-risk.

ESG progress
We are long-term custodians of public
infrastructure; in the year of the 2021 United
Nations Climate Change Conference
(‘COP26’), institutional investors’ approach
to climate change adaptation and mitigation
has come under welcomed scrutiny. It has
empowered the investment community to do
more to support the global transition to a low-
carbon economy.

The landscape for responsible investment has
shifted markedly since 2011 and we continue
to evolve the Company’s reporting and
monitoring of ESG performance. This year we
will publish our second annual ESG Report,
highlighting the areas where we have made
material progress during the year, in particular:

– BBGI became a signatory of the Net

–

Zero Asset Managers’ initiative, having
committed to supporting the goal of Net
Zero GHG emissions by 2050. We have
set out our specific Net Zero targets in the
ESG section of this report.

The Company has begun reporting all
Scope 1, 2 and 3 corporate emissions, the
results of which have been independently
verified. The Company has purchased
high-quality offsets, and is certified as
carbon neutral for 2021. As BBGI begins
to implement its Net Zero plan, it will work
to actively reduce its carbon footprint and
rely less on offsets in the future.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTCo-CEO Statement continued

Additionally, in October 2021, BBGI signed
an acquisition agreement for an interest in
a healthcare asset in Canada for a price of
approximately £51 million, subject to certain
adjustments, which is expected to complete in
2022 and completed a £24 million investment
in a clean energy infrastructure asset in
Canada in February 2022.

Looking ahead
The need for public infrastructure is expected
to remain strong in the markets in which we
operate, and the market conditions remain
supportive for continued infrastructure
investment.

The proven resilience of availability-based
infrastructure to external shocks such as the
COVID-19 pandemic over the last two years
has reinforced the desirability of our asset
class for those investors looking for stable and
predictable cash flows with inflation linkage
and low correlation to other asset classes.

Despite the heightened interest, we believe
our reputation as a specialist responsible
investor in low-risk global infrastructure, along
with our well-established relationships with
key vendors will allow us to continue to source
attractive investment opportunities.

We have full confidence in the Company’s
ability to deliver long-term, predictable, and
stable income to our shareholders, and to
fulfil our social purpose in the communities in
which we operate.

We sincerely thank our shareholders for
their support over this past decade and look
forward to the future with confidence.

Duncan Ball
Co-CEO

Frank Schramm
Co-CEO

30 March 2022

On behalf of the BBGI Management Board

– We have started to track Scope 1 and 2
emissions at our portfolio companies.
This information will be published from
2022 onwards and will also be shared with
our public sector clients in the hope that
it will influence outcomes that support
a reduction in GHG emission at the
portfolio company level.

– We undertook a comprehensive

–

stakeholder materiality assessment
among our employees, shareholders,
clients, partners, subcontractors and
suppliers to produce ten material
topics influencing our ESG strategy.
These ten topics have formed key ESG
commitments and KPIs which we are
tracking to ensure we achieve incremental
progress in our delivery of positive
stakeholder outcomes.

The Company has introduced an
enhanced ESG Best Practice Guide
which is designed to support the
implementation of BBGI’s ESG and
Sustainability strategy across all of its
Portfolio Companies. It builds on the
significant progress already made by all
Portfolio Companies over the years to
formalise and further integrate a strong
ESG framework and reflects today’s higher
standards and expectations related to
sustainability performance.

The Company complies with the
EU Sustainable Finance Disclosure
Regulation (‘SFDR’). Since March
2021, the Company has enhanced its
disclosure in line with SFDR requirements
and designated as a socially beneficial
investment under Article 8 of the
Directive. The SFDR seeks to provide a
framework for greater transparency across
those companies that make a genuine
contribution to sustainable outcomes.
BBGI welcomes the initiative and will
actively report against the new standards
as they emerge.

– We have once again included voluntary
disclosures in line with the Task Force on
Climate-Related Financial Disclosures
(‘TCFD’) recommendations in the ESG
section of this Annual Report. BBGI
continues to be a ‘TCFD supporter’.

Global Pipeline
The pipeline for availability-based transactions
remains generally strong and attractive within
the Company’s key markets. We anticipate these
will come from a variety of sources, including
our North American strategic partnership with
SNC-Lavalin, which covers four more assets with
an expected value in excess of C$200 million,
and several primary and secondary investment
opportunities we are currently pursuing in
Europe and North America.

BBGI Global Infrastructure S.A. | Annual Report 2021

Investment Proposition

We are a responsible
global social infrastructure
investor, with a low-risk
investment strategy focused
on delivering long-term
sustainable returns.

The Company seeks to provide its shareholders
with unique access to a global portfolio of
social infrastructure investments, which
generate stable, predictable cash flows over
the life of government or government-backed
contracts that typically extend to 20 years and
more in length.

The predictability of these government-
backed revenues enables BBGI to return
to investors a sustainable and progressive
income stream in the form of a semi-annual
dividend.

Strategic Pillars

Investment Strategy

Consistent delivery of objectives

Robust total
shareholder returns

Inflation linkage

Low correlation to
other asset classes

– Availability-based investment

strategy

– Secure public sector-backed

contracted revenues

– Stable and predictable cash
flows with progressive long-
term dividend growth

– Focus on highly-rated

investment grade countries

– Stable, well-developed
operating environments

– A global portfolio serving

society through supporting
local communities

– ESG fully integrated into
the business model

– Focus on delivering social
impact and a high degree
of climate resilience

– Executive compensation

linked to ESG performance

Low-risk1

Globally
diversified

Strong ESG
approach

Internally
managed

– Alignment of interests

– Shareholder value

first, portfolio growth
second

– Lowest comparative
ongoing charges2

Sustainable growth

1
2

In comparison to other equity infrastructure asset classes.
In comparison to the latest publicly available information for all closed-ended, LSE-listed equity infrastructure investment companies.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTOperating Model

The Management Board follows a
proven operating model of value-driven
active asset management, prudent
financial management and a selective
acquisition strategy to preserve value,
achieve portfolio growth and ensure
ESG considerations are embedded
in our investment processes. These
operational pillars are fundamental to
the Company’s success.

We ensure stable operational performance through an
active asset management approach, where we actively seek
to preserve value and, where possible, also to identify and
incorporate value enhancements over the lifetime of asset
ownership. In turn, this helps to reduce cost to our public
sector clients and the asset’s end-users, and enhances
the operational efficiency of each asset. This active asset
management approach allows the Company to generate
a high level of asset availability, which supports high client
satisfaction rates and underpins the strong social purpose of
our entire portfolio.

Our prudent financial management is focused on efficient cash
management and implementation of our foreign exchange
hedging strategy. The portfolio’s geographical diversification
results in exposure to multiple currencies. We actively seek
to manage geographical concentration and mitigate foreign
exchange risk by balance sheet hedging through foreign
exchange forward contracts, hedging of forecast portfolio
distributions and borrowing in non-Sterling currencies.
Furthermore, Euro-denominated running costs provide
a natural hedge against the Euro-denominated portfolio
distributions.

The Company’s selective acquisition strategy ensures that the
Management Board’s focus remains within its area of expertise
and that the strategic pillars defined by the Company’s
investment proposition are upheld.

We actively seek acquisitions that have inflation-protection
characteristics which support the portfolio’s inflation linkage.

BBGI Global Infrastructure S.A. | Annual Report 2021

Value-driven active
asset management

We pursue a standardised approach across all investments in the
portfolio to help derive operational and value enhancements and
preserve value, including:
– Preserving value, and where possible, identifying and delivering
value enhancements to improve customer experience and
financial performance.
Focused management at the asset level to ensure distributions are
on time, and on or above budget.

–

– Applying a high-quality corporate governance framework.
– ESG KPI tracking tool introduced in 2018 to evaluate non-financial
performance of each investment and enhanced BBGI Best Practice
Guide with over 80 KPIs and questions introduced in 2021.
Standardised and detailed climate risk assessment undertaken
for the entire portfolio and comprehensive monitoring to ensure
fulfilment of contractual and legal obligations, which serves to
maintain high availability levels and prevent deductions.
Strong client relationship management, including regular meetings
to uphold client satisfaction and monitor ESG performance.
Focused and active asset management, including site visits to all
significant investments annually, and proactive management of issues.
Focused cost management and portfolio-wide cost-saving
initiatives leveraging economies of scale (e.g. portfolio insurance and
standardised management contracts for portfolio companies).
– Review of debt facilities of Portfolio Companies and investigation of

–

potential refinancing benefits
Identifying and continuing initiatives at the individual asset level to
outperform base case (e.g. lifecycle reviews).

– Measured exposure to construction risk to support NAV uplift by de-

risking assets over the construction period.

Prudent financial
management

We maintain focus and attention to cash performance at the asset and
portfolio level to drive efficiencies, including:
– Maintaining modest cash balances to limit cash drag.
–

The portfolio’s geographical diversification by necessity involves
exposure to multiple currencies. We actively seek to manage and
mitigate foreign exchange risk through our hedging strategy.
– Maintaining a low ongoing charge through an efficient and cost-

effective internal management structure.

– Progressive future dividend growth underpinned by strong portfolio

distributions.

Selective acquisition
strategy

We maintain strategic discipline in our acquisition strategy and portfolio
composition to ensure we pursue growth that is accretive to shareholder
value, not just for growth’s sake, including:

– Broad industry relationships in multiple geographies.
– Pre-emption rights to acquire co-shareholders’ interests.
– Global exposure to avoid geographical concentration.
– Robust framework embedding ESG principals into investment due

diligence.

– Revolving corporate debt facility to support transaction execution.
– Visible pipeline through a North American strategic partnership.
– Maintaining focus on the Management Board’s core areas of expertise.

sset manag e m

e a
iv
t
c
a
n
e
v

r
d

Selective a

it
i

Preserve value
and achieve
portfolio
growth

m ent

Prudent ﬁn a n c i a l m a

Champlain Bridge, Canada

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCORPORATE GOVERNANCESTRATEGIC REPORTCOMPANY OVERVIEW

Portfolio Review

Portfolio summary

The Company’s assets as at 31 December 2021 consist of interests in 54 high-quality, availability-based social infrastructure assets, 99.5 per cent.
of which are fully operational (by portfolio value). The portfolio has no exposure to demand-based or regulated investments, and is well diversified
across sectors in education, health16, blue light, affordable housing, modern correctional facilities and transport.

Located in the UK, North America, Australia and Continental Europe, all portfolio companies in our portfolio are located in stable, well-developed
and highly-rated investment grade countries.

Portfolio breakdown*
For portfolio statistics, refer to the Portfolio at a Glance section of this Annual Report.

Asset

Country

Percentage
holding

Asset

Country

Percentage
holding

Lagan College

Lisburn College

Liverpool and Sefton Clinics (LIFT)

M1 Westlink

M80 Motorway

McGill University Health Centre

Canada

Mersey Care Hospital

Mersey Gateway Bridge

N18 Motorway

North Commuter Parkway

North East Stoney Trail

North London Estates Partnership (LIFT)

North West Fire and Rescue

North West Regional College

Northwest Anthony Henday Drive

Northern Territory Secure Facilities

Ohio River Bridges

Poplar Affordable Housing and Recreational
Centres

Restigouche Hospital Centre

Rodenkirchen Schools

Royal Women’s Hospital

Scottish Borders Schools

South East Stoney Trail

Stanton Territorial Hospital

Stoke and Staffordshire Rescue Service

Tor Bank School

Unna Administrative Centre

Victoria Correctional Facilities

Westland Town Hall

William R. Bennett Bridge

Women’s College Hospital

Netherlands

Canada

Australia

Canada

Germany

Australia

Canada

Germany

Australia

Netherlands

Canada

100

79.6

37.5

100

66.7

100

A1/A6 Motorway

Netherlands

Aberdeen Western Peripheral Route

Avon & Somerset Police HQ

Ayrshire and Arran Hospital

Barking Dagenham & Havering (LIFT)

Bedford Schools

Belfast Metropolitan College

Burg Correctional Facilities

Canada Line

Champlain Bridge

Clackmannanshire Schools

Cologne Schools

Coventry Schools

E18 Motorway

East Down Colleges

Frankfurt Schools

Fürst Wrede Military Base

Gloucester Royal Hospital

Golden Ears Bridge

Highway 104

Kelowna and Vernon Hospital

Kent Schools

Kicking Horse Canyon

Germany

Canada

Germany

Norway

Germany

Canada

37.1

33.3

100

26.7

100

16
*

Includes a limited exposure to UK acute healthcare of less than one per cent of NAV.
In alphabetical order

BBGI Global Infrastructure S.A. | Annual Report 2021

Portfolio Review continued

Operating model in action
Preserving and enhancing value through
active asset management
The Management Board’s focus on
preserving portfolio value resulted in £13.1
million of operational and value accretive
enhancements over the year, equating to a
1.4 per cent. increase in NAV. BBGI was able
to refinance four investments optimising the
financial structure of each of those Portfolio
Companies with lower-cost long-term
financing. Additional activities involved inter
alia managing change orders and earning a fee
for these services, cost savings due to lower
fees on management service agreements,
operations and maintenance agreements, and
changes in lifecycle costs.

Our active approach to asset management
and the robustness of our portfolio meant
that the availability level of the Company’s
assets was recorded at approximately 99.9 per
cent. and deductions were either borne by
third-party facility management companies
and road operators, or were part of planned
lifecycle expenditures.

There were no material lock-ups or default
events reported during the period.

Prudent financial management
The assets continued to perform well during
the reporting period with cash receipts
during the year ahead of business plan. This
robust performance and the confidence in
the business model allowed the Company to
achieve its dividend target of 7.33pps for 2021,
and furthermore reconfirm our dividend target
of 7.48pps and 7.63pps for 2022 and 2023,
respectively. We are also pleased to introduce
a new dividend target for 2024 of 7.78pps. Cash
receipts during the year allowed the Company
to achieve a strong dividend cover of 1.31x. The
predictable nature of our cash flows allows for
high visibility for future dividends, and therefore
gives us the confidence to extend our dividend
guidance to 2024, which is expected to be fully
cash-covered.

The net cash position on an Investment Basis
as at 31 December 2021 was £26.9 million.

The Company has efficient cash management
in place which aims to avoid cash drag.
This includes using the proven financing
methodology of drawing on its RCF before
raising new equity to repay the temporary
debt. The Company secured the amendment
and restatement of the RCF, increasing the
committed amount to £230 million, which
will now mature in 2026. Furthermore, the
Company has the possibility of increasing
the quantum to £300 million by means of an
accordion provision.

This enables the Company to execute larger
acquisitions in an efficient manner and to be a
trusted and repeat partner in its key markets.

Selective acquisition strategy
Successful acquisitions and commitments
The Company continued to pursue a selective
acquisition strategy over the period, investing
approximately £79.2 million which included
interests in four new projects all of which earn
availability-based revenue in return for providing
essential public services. In addition, one
acquisition agreement was signed in October
2021 for a value of approximately £51 million,
subject to certain adjustments, and a further
acquisition was completed in February 2022
with a value of £24 million. This demonstrates the
Management Board’s commitment to avoiding
style drift and evidences how BBGI’s strong
industry relationships and nimble operating
model continue to realise a strong pipeline of
acquisition opportunities, with the Management
Board having assessed many more potential
opportunities than those acquired.

The four new investments were:
– Poplar Affordable Housing &

Recreational Centres (UK): In April 2021,
BBGI acquired a 100 per cent. interest
in a social infrastructure investment,
consisting of two recreational facilities
and 100 affordable residential units across
two sites in the London Borough of Tower
Hamlets. This PPP project originally
consisted of the design, construction,
financing, operation, maintenance and
rehabilitation of separate buildings: the
major regeneration and refurbishment
of the derelict Poplar Baths building
into a modern first-class community
leisure centre; and the construction
of the Haileybury Community Centre,
Randall House (60 affordable residential
units), Dame Colet Court (25 affordable
residential units) and Baltonsborough
Court (15 affordable residential units).

Construction was completed in 2016 and
the concession runs until 2051. The asset
is classified as availability-based under
the investment policy of the Company.
Availability payments are received from
the London Borough of Tower Hamlets.

London Borough of Tower Hamlets is
responsible for the operation of the leisure
centre and the affordable housing units.
BBGI is not responsible for letting risk or
responsibilities within the residential units
or the community centre.

The asset is located in an area with high
levels of social inequality. All of the
residential buildings are designed and
built to the Code for Sustainable Homes

Level 4. A proportion of the residential
units and public buildings are powered by
rooftop solar photovoltaic panels which
collectively help reduce CO2 emissions by
over 22 tonnes per year.

– Ayrshire and Arran Hospital (UK): In

July 2021, BBGI acquired a 100 per cent.
interest in this project, which consists
of the design, construction, financing,
operations and maintenance of a 206-
bed acute mental health facility in Irvine,
Scotland. The hospital became operational
in 2016 and the concession runs until 2041.
The facility has significantly increased the
availability of, and access to, mental health
services and treatment in the region.

The facility was awarded a BREEAM17
rating of ‘very good’ and is equipped with
low or zero carbon heating and power
technology. Availability payments are
received from the Ayrshire and Arran
Health Board.

– North West Fire and Rescue (UK): In

July 2021, BBGI acquired a 100 per cent.
interest in this project, which consists
of the design, construction, financing,
operations and maintenance of 16 new
community fire stations located at various
sites in Merseyside (seven), Lancashire
(four) and Cumbria (five). The facilities
became fully operational in 2013 and the
concession runs until 2038.

The facilities play an integral role in
delivering fire safety and protection
to more than 500,000 people in the
local communities. The facilities were
awarded a BREEAM rating of ‘very good’
and sustainability measures have been
integrated into the buildings. Availability
payments are received from Cumbria
County Council, Lancashire Combined
Fire Authority and Merseyside Fire and
Rescue Authority.

– Aberdeen Western Peripheral Route
(UK): In August 2021, BBGI acquired
a 33.33 per cent. interest in this project
which consists of the design, construction,
financing, operations and maintenance of
12 km of the existing roadway (upgraded)
and 47 km of new dual carriageway
including two significant river crossings.
The final section of the road opened in
2019 and the concession runs until 2047.

The project was developed in compliance
with strict EU environmental legislation
and has reduced congestion in Aberdeen
by approximately 46 per cent. and HGV
traffic on local routes by approximately
55 per cent. Availability payments are
received from the Scottish Ministers.

17 Building Research Establishment Environmental Assessment Method.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT

Portfolio Review continued

Facility Manager/O&M Contractor

22%

13%

O&M Contractors:

Portfolio Company inhouse

13%

SNC-Lavalin O&M Inc

Capilano Highway Services

Black & McDonald

Honeywell

Cushman and Wakefield

Integral FM

Carmacks Maintenance Services

BEAR Scotland

Graham AM

Amey Community Ltd

Intertoll Ltd

Guildmore Ltd

Galliford Try FM

ENGIE FM Limited

Remaining investments

Latent Defects Limitations /
Warranty Period Remaining

10+ years,
7%

5-10 years,
13%

22%

100%

Expired,
36%

2-5 years,
34%

Within 1
year, 1%

1-2 years,
9%

One acquisition agreement signed:
– Center Hospitalier de l’Université

de Montréal (‘CHUM’) (Canada): In
October 2021, BBGI entered into an
agreement to acquire a 25 per cent.
interest in the design, construction,
finance, operation and maintenance of
a fully functional new hospital facility
including new buildings, parking and
commercial retail areas together with
supporting infrastructure for the Province
of Québec. The asset is classified as
availability-based under the investment
policy of the Company and aligns with
BBGI’s ESG principles. The hospital has
772 private patient rooms, 39 operating
theatres and 415 examination rooms. The
new state-of-the-art facility caters to over
1.7 million people in the region and it is one
of the largest healthcare centres in North
America. The project achieved substantial
completion of phase 1 in 2017 and phase 2
in 2021. The concession runs until 2050.

One acquisition completed in February 2022:
–

John Hart Generating Station
Replacement Project (Canada). In
February 2022, BBGI completed the
acquisition of an investment in InPower
BC General Partnership, the entity
responsible for delivering the John
Hart Generating Station Replacement
Project (‘John Hart Generating Station’),
an investment delivered through the
existing strategic partnership between
the Company and SNC-Lavalin Group
Inc. The PPP consists of the design,
construction, financing, maintenance
and rehabilitation of a new three-turbine,
132-MW hydroelectric power generation
station on the Campbell River, British
Columbia, including a three generating-
unit underground powerhouse, 2.1
kilometres of water passage tunnels
and a water bypass system to protect
downstream fish habitat. The acquisition
price was approximately £24 million.

Service commencement was achieved
in 2019 and the concession runs until
2033. The asset is classified as availability-
based under the investment policy of
the Company. The investment is not
subject to demand or power price risk.
Availability payments are received from
the British Columbia Hydro & Power
Authority (rated AA/Aaa by DBRS
Morningstar and Moody’s respectively),
a Crown corporation wholly-owned by
the Government of British Columbia.
The station generates clean and reliable
energy for over 80,000 homes.

All projects acquired or committed to in the
period add to the portfolio’s diversification
across multiple social infrastructure sectors
where the demand for private sector
investment remains high. The Management
Board continues to source a selective pipeline
of investments from construction companies
and developers who are looking to divest
operational PPP assets.

Strategic investment partnerships
The Company continues to leverage strong
relationships with leading construction
companies to source a potential pipeline that
supports a low-risk and globally diversified
investment strategy.

One notable relationship is the North
American strategic partnership with SNC-
Lavalin, which covers five availability-based
assets, one of which, the John Hart Generating
Station in Canada, was completed in February
2022. The Company estimates that further
investment opportunities in excess of
C$200 million could result from the pipeline
agreement over the next years; all of which will
be assessed on a case-by-case basis. More
details of the projects covered by the pipeline
agreement are provided in the Market Trends
and Pipeline section of this Annual Report.

Typically, contractors active in the sector have
secured the mandate to design and build
new assets, but continue to look to divest
financially after the construction period has
finished – thereafter often maintaining facility
management contracts through a long-term
partnership. The Company is an attractive
partner for a number of reasons:

– We have extensive asset credentials and a
strong track record that can assist with the
shortlisting process for new projects.

– Having a financial partner is a pre-requisite
for some construction companies so they
can avoid consolidating the Portfolio
Company debt onto the balance sheet of
the parent company.

– Our cost of capital is typically lower than
construction companies, so involving
BBGI can make the bid more competitive.
In some cases, there are restrictions on
future transfers or gain sharing provisions,
so it may be attractive to bring in a long-
term capital provider like BBGI early in the
process.

– We are a long-term investor with a public
listing which is attractive to government
and government-backed counterparties.

– We are considered a reliable source of
liquidity should a construction partner
decide to sell in the future.

BBGI Global Infrastructure S.A. | Annual Report 2021

Portfolio Review continued

Avoiding style drift
As the competition to acquire availability-
based assets at attractive valuations has
intensified, the Company’s Management
Board has consciously worked to avoid style
drift. This refers to the practice of moving up
the risk spectrum, particularly where pricing
does not accurately reflect inherent risks,
both to find investible assets and to make the
targeted returns to investors.

The Management Board has made the
conscious decision to avoid investing in
infrastructure transactions where the revenue
stream is demand-based which is typically highly
correlated to Gross Domestic Product (‘GDP’),
or subject to uncertainty due to regulatory
review periods and political interventions.

While this disciplined approach may at times
result in periods of lower portfolio growth,
we believe the benefits of this continued
specialisation and focus on a low-risk,
availability-based investment model result
in dependable and consistent income and
returns with low volatility. By staying focused
on the availability sector and by remaining
within our sphere of expertise, we believe we
offer a less complex business proposition,
and consequently, there should be fewer
surprises and the returns to our shareholders
should remain predictable and consistent. The
robustness of this strategy has been validated
during the recent global pandemic – as the
Company does not have any demand-based
assets and the portfolio is 99.5 per cent.
operational. Consequently, the portfolio
performance has been strong and there has
been no material impact on our distributions
due to COVID-19.

Supply chain monitoring
The Management Board continually reviews
the potential concentration risk of operational
and maintenance (‘O&M’) contractors
who provide counterparty services to the
Company’s assets. The table illustrates
the level of O&M contractor exposure as a
percentage of portfolio value18.

The Management Board has not identified any
significant risk exposure and remains comfortable
with the current contractor allocation.

The Company benefits from a diversified
contractor base and supply chain with no
concentrated exposure, combined with a
rigorous supply chain monitoring policy. We
pay close attention to how subcontractors are
performing on an ongoing basis and have risk
mitigation procedures in place in case of any
supply chain failure.

The continuation of the COVID-19 pandemic
remained a key area of focus for the Management
Board during the reporting period, and further
reinforced the importance of active asset
management and a robust supply chain. The
Company is pleased to confirm again that
despite the ongoing unprecedented strain on
our supply chain resulting from COVID-19, we
have not recorded any material adverse supply
chain issues over the period.

Construction defects
The Company routinely monitors the quality of
its assets to identify any construction defects
early on and to implement the appropriate
remediation measures.

The responsibility for, and the cost of
remediation and related deductions falls to the
relevant construction subcontractor on each
asset subject to statutory limitation periods.
This is a key component of the Company’s
effective counterparty risk management.

Latent defects risk was mitigated over the
period with 64 per cent. of portfolio value
covered by either limitation or warranty periods
and there were no material defects reported on
any of the Company’s portfolio assets.

18 When a project has more than one FM contractor and/or O&M contractor, the exposure is allocated equally among the contractors.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTPortfolio Snapshot

Our five largest assets

Ohio River
Bridges:

– Type: Availability-based

– Status: Operational

– Equity Holding (%) BBGI: 66.7%

– Total Investment Volume:

US$1.175 billion

– Financial Close/Operational:
March 2013/December 2016

– Concession Period: 35 years (post

construction) ending in 2051

Golden Ears
Bridge:

The project includes a 760m cable-stay bridge;
a 500m long twin vehicular tunnel and 2.25km
of associated six-lane Interstate Highway, with
more than 21 bridges and multiple roundabout
style interchanges. The asset greatly improves
connectivity, public safety and economic
growth, which benefits residents, businesses
and visitors in the Southern Indiana region,
particularly for those road-users travelling to
and from the state of Kentucky.

In October 2021, a US$528 million green bond
offering was completed to refinance its existing
indebtedness. This transaction allowed the
Portfolio Company to optimise its financing
costs over the remaining term of the contract
thereby further strengthening its financing
structure, while also benefiting the public
sector client through a reduction in future

service payments. The refinancing bonds were
assigned an ‘A1’ rating by Moody’s and an ‘A’
rating by Fitch. The new bonds qualified as a
green bond offering, based on the asset’s high
standards for energy efficiency, sustainability
and environmental stewardship. Its
environmental commitment dates back to the
construction phase, when the project received
the prestigious Envision Platinum honour from
the Institute for Sustainable Infrastructure.
More recent environmental initiatives include
installing solar panels on the Operations and
Maintenance (‘O&M’) buildings, a commitment
to transitioning its fleet of vehicles to reduced-
emission and electric-powered, pollinator
habitats and other wildlife conservation
initiatives, and an organisation-wide recycling
programme, to name a few.

– Type: Availability-based

– Status: Operational

– Equity Holding (%) BBGI: 100%

– Total Investment Volume

(Debt & Equity): C$1.1 billion

– Financial Close/Operational:

March 2006/June 2009

– Concession Period: 32 years (post

construction) ending in 2041

Golden Ears Bridge represented the largest
private financing for a greenfield PPP in
Canada at the time of its launch. The project
involves the design, build, financing, operation
and maintenance of the Golden Ears Bridge
in Vancouver which is a 1km, six-lane road that
spans the Fraser River and connects Maple
Ridge and Pitt Meadows to Langley and
Surrey. The road opened in March 2009 and
includes more than 3.5km of ramps, viaducts,
minor bridges and underpasses, and more
than 13km of mainline roadway; a large part of
which has been landscaped.

The project has brought close to C$1 billion
in construction-related activity to the
area, while commuters that use the bridge
now save up to 40 minutes per peak-hour
round-trip from Maple Ridge to Langley.
In coordination with the asset operator, we
have implemented an LED conversion for all
project lighting, which has delivered annual
energy savings in excess of 380,000 kWh
and has reduced carbon dioxide emissions
at a rate of 273 metric tons per year.

BBGI Global Infrastructure S.A. | Annual Report 2021

Portfolio Snapshot continued

Northern
Territory
Secure
Facilities:

–

Type: Availability-based

Status: Operational

– Equity Holding (%) BBGI: 100%

–

Total Investment Volume
(Debt & Equity): A$620 million

– Financial Close/Operational:

October 2011/November 2014

– Concession Period: 30 years
(post construction) ending in
2044

Located near Darwin, Northern Territory
(the ‘Territory’), the project involves the
design, build, financing, operation and
maintenance of three separate centres
including: a 1,000-bed multi-classification
male and female correctional centre, a 30-
bed secure mental health and behavioural
management centre (the first of its kind
in the Territory), and a 48-bed supported
accommodation and programme centre
for community-based offenders.

The latter is designed to support the
government’s goals of enhanced
rehabilitation, education and reduced
reoffending rates in the Territory.

The asset is one of the largest social
infrastructure projects in the Territory and is
the largest PPP ever procured to date. BBGI
acquired its initial 50 per cent. interest in
the asset while it was still in construction and
subsequently acquired the remaining 50 per
cent. stake in July 2015.

McGill
University
Health
Centre
(MUHC):

–

Type: Availability-based

Status: Operational

– Equity Holding (%) BBGI: 40%

–

Total Investment Volume:
C$2 billion

– Financial Close/Operational:

July 2010/October 2014

– Concession Period: 30 years
(post construction) ending in
2044

The project involves the design, build,
finance, operation and maintenance of
MUHC’s Glenn campus. It comprises two
hospitals, a cancer centre and a research
institute in Montreal, for a total concession
duration of 34 years.

Victoria Hospital and the Montreal Chest
Institute, as well as the new Cedars Cancer
Centre and the Research Institute of the
MUHC. MUHC is the workplace of over
12,000 hospital staff, 1,356 physicians, dentists,
pharmacists and 720 medical students.

MUHC is one of the most innovative
academic health centres in North America,
and at 214,000m2, it is the largest
English-speaking hospital in Quebec.
One integrated campus consolidates the
Montreal Children’s Hospital, the Royal

The Glenn campus project achieved a Gold
certification for Leadership in Energy and
Environmental Design (‘LEED’) in 2016 - the
first hospital in Quebec to do so.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTPortfolio Snapshot continued

Victoria
Correctional
Facilities

–

Type: Availability-based

Status: Operational

– Equity Holding (%) BBGI: 100%

–

Total Investment Volume:
A$244.5 million

– Financial Close/Operational:
January 2004/March 2006

– Concession Period: 25 years (post

construction) ending in 2031

Victoria Correctional Facilities is an availability-
based PPP asset entailing the design, finance,
construction and operation of two correctional
facilities for the State of Victoria, Australia (the
‘State’). The first facility, Metropolitan Remand
Centre, accommodates up to 1,000 male
offenders and is located approximately 20km
from Melbourne city centre. The second,
smaller facility is the Marngoneet Correctional
Centre that houses up to 550 male offenders
and is located approximately 65km from
Melbourne city centre. The operational period
is 25 years and runs until 2031.

A substantial augmentation was requested
by the State to reinforce the facility and this
completed in June 2018.

BBGI Global Infrastructure S.A. | Annual Report 2021

Market Trends and Pipeline

Connecting communities and delivering vital public services
via long-term, responsible global infrastructure investment.

2022 and beyond
The global economy enters 2022 in a weaker
position than previously expected by many.
The Omicron variant of COVID-19 slowed
the expected recovery and then the recent
Russian invasion of Ukraine has created
significant uncertainty across global markets.
Rising energy prices and supply-chain
disruptions have resulted in higher and more
broad-based inflation than anticipated. The
debate continues as to whether inflation is
more transitory or structural.

Monetary policy in many countries is
expected to continue on a tightening path to
curb inflation pressures, while fiscal policy—
operating with more limited space than earlier
in the pandemic—will likely prioritise health
and social spending. Investing in climate
policies remains imperative to reduce the risk
of catastrophic climate change.

In this environment of rising interest rates
from historic lows, inflation fears and general
uncertainty, the stability, inflation-linkage
and resilience associated with availability-
based social infrastructure investments has
maintained its status as an attractive asset
class, and competition for investments
remains strong.

The levels of competition for the availability-
based assets in which we invest vary between
markets. While availability-based social
infrastructure remains a very appealing sector
to many, it can be difficult for new entrants with
big ambitions to deploy meaningful amounts
of equity quickly since the typical transaction
size is often smaller than other infrastructure
investment opportunities, and individual asset
sales are more common than large portfolio
transactions. With a well-established platform,
specialist skills, strong industry relationships
and a reputation amongst sellers of
transacting successfully, BBGI has been able
to grow its portfolio from the original 19 assets
to 54, while still maintaining pricing discipline
and expects to be able to continue to do so in
2022 and beyond.

In all BBGI’s target markets, infrastructure
under-investment persists, and public
finance budget constraints necessitate the
involvement of the private sector to deliver
the finance and expertise required to build,
maintain and operate much-needed assets.
Many governments have ambitious plans
to make major infrastructure commitments
to create jobs, revitalise communities, move
towards a low carbon economy, and to act as
a catalyst for economic recovery. Across the
regions we operate in, there is a consistent
baseline of new investment opportunities, and
we expect this trend to continue.

At the same time, many construction
companies continue to consider the
divestments of availability-based
infrastructure investments that they hold.
This could be to recycle capital into new
opportunities after a project reached
construction completion or in response to
capital needs in other parts of their business
due to economic challenges. BBGI has well-
established relationships with most major
construction companies in the sector and
this continues to be a good source of new
investment opportunities for us.

As a result of this trend, BBGI completed four
transactions with construction companies
and PPP developers in 2021 and we continue
to see significant scope to make further
investments during the course of 2022.

Investment activity in 2022 will involve
sourcing and originating, bidding for and
winning new operational availability-based
investments, with consideration for measured
exposure to construction assets to support
future valuation uplift.

The pipeline for availability-based transactions
remains generally strong within the
Company’s key markets. We anticipate these
will come from a variety of sources, including:

– A North American strategic partnership
with SNC-Lavalin which has already
resulted in the acquisition of five assets
amounting to approximately C$191
million and provides the opportunity for
potentially more acquisitions:
– In February 2022, BBGI acquired an
interest in the John Hart Generating
Station Replacement Project, as a
result of the formal pipeline agreement
between BBGI and SNC-Lavalin. This
was our sixth investment sourced from
SNC-Lavalin

–

– The formal pipeline agreement with

SNC-Lavalin covers four more assets
with an expected value in excess
of C$200 million and BBGI has the
option, not the obligation, to transact.

The Company is a shortlisted bidder
for an EU transportation opportunity of
approximately EUR 200 million (including
both debt and equity) and is considering
another EU transportation bidding
opportunity

– BBGI is currently bidding or expects to

bid on a variety of secondary transactions
during the year, including:
– EU transportation opportunities

– North American transportation

opportunities

– An EU social opportunity

–

Soliciting off-market transactions through
BBGI’s extensive network of market
participants in Australia, Europe and North
America;

– Participating in primary investment
opportunities and bidding on new
availability-based assets as part of public
sector procurement processes;

– Acquiring accretive equity interests from
co-shareholders in existing assets; and

– Participating in competitive sale

processes, not least to test pricing
assumptions.

The Company will continue to source assets
that fit the requirements of its low-risk and
globally diversified investment strategy,
and which also support its approach to
Responsible Investment.

Canada
Canada has remained one of the world’s most
prolific PPP markets and is one of the most
mature and stable of the Company’s markets.
Almost 300 assets across Canada have been
procured under the PPP model, with those
already in operation or under construction
valued at over C$140 billion – including
hospitals, education, courthouses and
transport assets.

Ontario is the province with the largest
pipeline of opportunities and its first
market update for 2022 affirms its historic
commitment to modernising the province’s
public assets, including hospitals, highways,
public transit, children’s treatment centres,
courthouses and correctional facilities.
Infrastructure Ontario’s plans include 24
projects in pre-procurement and 15 in active
procurement, totalling an estimated C$60
billion in contract value. The list also includes
14 additional government-announced projects
in early stages of planning and determining
the project’s scope, timing and delivery model.

Other provinces have promising, albeit
smaller programmes. The Investing in Canada
Infrastructure Program was adjusted so that
provinces and territories can use federal
funding to act quickly on a wider range of more
pandemic-resilient infrastructure projects. As
part of a COVID-19 resilience funding stream
worth up to C$3.3 billion, projects will be
eligible for a significantly larger federal cost
share and a simplified funding application
process. These changes are designed as short-
term measures to address the current situation
while the Federal Government works towards
its long-term infrastructure objectives,
including better public transit, more high-
speed broadband, wastewater infrastructure
and clean energy projects.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTMarket Trends and Pipeline continued

The Government has announced it will
not implement a replacement for private
finance initiatives (PFI), which were abolished
in October 2018. This has meant that the
greenfield infrastructure investment pipeline is
relatively subdued, although stronger in some
areas (Wales) and sectors (e.g. water projects).

Although there will not be a UK-wide
replacement for the PFI, Wales has recently
closed several private finance projects under
its new Mutual Investment Model (‘MIM’) —
including the widening of the A465 motorway
sections 5 and 6 and its 21st Century Schools
Programme. With MIM projects the Welsh
Government takes up to a 20% stake in the
special purpose company, which provides
a greater stake in the project’s success
and greater accountability. Scotland is also
planning to launch a major motorway PPP, the
A9 Perth to Inverness Dualling Project and is
investigating the use of the MIM model.

The Management Board notes that some
other asset classes are demonstrating a
risk-return profile that increasingly matches
the Company’s low-risk, availability-based
investment strategy. The UK Government will
continue to develop new revenue support
models and consider how existing models –
such as the Regulated Asset Base model and
Contracts for Difference – can be applied in
new areas, and remains open to new ideas
from the market.

The UK market continues to be a source of
secondary market transactions. However,
the reduction in secondary market PFI deal
flow reflects the slowdown in public sector
procurement since 2010 and the large amount
of secondary activity in previous years. While
supply has decreased, there has been no
corresponding decrease in demand. This
has resulted in a trend of lower discount rates
for stable, mature secondary assets since
around 2010.

With 15 assets in Canada as at 31 December
2021 plus the new investment in the John Hart
Generating Station announced in Q1 2022,
BBGI is well positioned to participate in an
attractive primary pipeline and is considered
a very credible purchaser for and manager of
secondary assets. We expect there will continue
to be an attractive mix of availability-based
social infrastructure investment opportunities
for the company to consider in 2022 and 2023,
as assets developed over the last several years
come into operation and may come to market.

As mentioned above, the Company also
benefits from its North American strategic
partnership with SNC-Lavalin which covers
four assets. The Company estimates that
further investment opportunities in excess of
C$200 million could result from the pipeline
agreement over the next few years; all of which
will be assessed on a case-by-case basis.

UK
The UK is one of the world’s most mature and
attractive infrastructure markets for private
investors. Private capital has been critical
in maintaining and upgrading the country’s
existing infrastructure and has played a central
role in the financing of new greenfield projects,
although more recently that market has been
overshadowed by brownfield investment.

The Government is committed to major
infrastructure investment including health,
education, science and defence, with the
2020 Spending Review delivering a £100
billion total investment programme in 2021-
22 to support the recovery. This is part of
the Government’s plan to invest over £600
billion over the next five years, delivering the
highest sustained levels of public sector net
investment as a proportion of GDP since
the late 1970s. Private investment to support
the country’s Net Zero 2050 ambitions
and playing a role in the ‘green industrial
revolution’ will also be critical; key sectors for
the private sector include energy transition,
electric vehicle (‘EV’) charging infrastructure
and fibre optic broadband.

Formal pipeline assets

Asset

Confederation Line (Ottawa, Ontario)

Eglinton Crosstown LRT (Toronto, Ontario)

Estimated Asset
Capital Value1

Concession length
after construction
completion

C$3.2 billion

30 years

C$9.1 billion

30 years

Sector

Rail

Highway 407 East Extension Phase I (Ontario)

Road

C$1.2 billion

30 years

Champlain Bridge (Montreal, Quebec)

Includes both debt and equity.

Road &
Bridge

C$3.2 billion

30 years

BBGI Global Infrastructure S.A. | Annual Report 2021

We remain optimistic that the PFI deal
flow will be replaced by next generation
transactions like the Aberdeen Western
Peripheral Road and the Ayrshire & Arran
Hospital which have very similar attributes and
risk and return profiles to the traditional PFI
procurement model. The Company’s appetite
for the selective acquisition of high quality,
availability-based assets has not diminished.
We will continue to pursue mainly secondary
availability-based opportunities in the UK.

US
It is an exciting time for US infrastructure
investment. The $1.2 trillion Infrastructure
Investment and Jobs Act (‘IIJA’), signed into
law by President Joe Biden in November
2021, includes $550 billion in new funding to
rebuild roads and bridges, water infrastructure,
resilience, EV charging infrastructure,
broadband and more. While much of the
planned spending will be via traditional
procurement channels, the expectation
remains that this will be a catalyst for more
PPP investment in the US.

Most public infrastructure in the US has
traditionally been funded with public money.
City and state authorities in the US built and
managed their roads, bridges, hospitals and
wastewater systems. Over the last 15 years,
private companies have expanded their
infrastructure delivery through PPPs, but to a
lesser extent than in other markets like the UK,
Canada and Australia.

Over time, the PPP model has become more
popular as state legislation has changed
to allow more private actors to take part in
building public infrastructure: 33 US states
and the District of Columbia have passed
legislation allowing PPPs. The IIJA paves the
way for more PPP’s by expanding how states
and localities may use Private Activity Bonds
(‘PAB’), a tax-exempt government-issued
bond to help finance projects such as carbon
capture and broadband access that also
involves private investment.

Encouragingly, a recent study carried out
amongst industry participants by White &
Case, in partnership with Acuris Studios, found
that more than three quarters (77 percent) say
PPP will be among their preferred options for
infrastructure projects outside of the energy
sector. The same survey results show that the
public authorities themselves are keen on
PPPs. Of the public authorities interviewed, 86
percent agreed that PPPs were the preferred
way to deliver infrastructure projects.

We are currently tracking opportunities in this
market and remain optimistic that an attractive
pipeline will emerge over time.

Market Trends and Pipeline continued

Continental Europe
According to Inframation, 39 European
PPPs reached financial close in 2021 with an
aggregate value of EUR 5.0 billion.

While many countries in Europe have slowed
down their PPP programmes, there are others
which are pushing ahead. France remains
one of the more active markets and Germany
continues to procure certain motorway PPP’s
like the current A1.

Primary and secondary opportunities
remain in France, Germany and Belgium.
Overall, Continental European infrastructure
markets remain active with certain countries
offering an attractive pipeline of new assets
as well as secondary opportunities. We
believe these markets are likely to provide
attractive investment opportunities over the
medium-term.

Belgium
BBGI is part of a consortium which
successfully pre-qualified for the A201
roads project in Belgium. The project is
an availability-based PPP involving the
reconstruction of the junction between the
Brussels’ ring road and the connection to
Brussels Airport with a 30-year operational
period following construction completion.

Germany
Germany has been an active market in
recent years and this trend is expected to
continue, with various road PPP schemes
planned or in procurement. With six existing
assets in Germany, strong credentials and
German language skills amongst our senior
executive and asset management teams,
BBGI is well positioned to consider any
upcoming opportunities.

Netherlands
The vast majority of PPP projects in the
Netherlands is tendered by the Central
Government. A distinction is made between
infrastructural PPP projects (motor highways,
floodgates, tunnels, etc.) and accommodation
PPP projects (court buildings, hospitals,
correctional facilities, central government
offices, museums, etc.). Furthermore,
decentralised authorities, such as provinces
and municipalities, manage PPP projects
related to social, healthcare or public
institutions’ accommodation.

Infrastructural PPP projects represent a
majority of the investment recently seen
in the Netherlands, and have included two
highways, one motorway, one tunnel and one
dam, with a total investment of approximately
EUR 4.79 billion.

Norway
National PPP projects have historically
been limited to the transport sector - major
highways. Municipalities have used PPP
procurement for education and other social
infrastructure, but these projects tend to be
smaller and more arbitrary.

The current national pipeline comprises
three highway projects: Rv 3 and rv 25
Ommangsvollen– Grundset/ Basthjørnet, Rv
555 Sotrasambandet (the Sotra connection),
E10 and rv 85 Tjeldsund– Gullesfjordbotn–
Langvassbukt. Whilst the first two projects
have successfully reached financial close, the
E10 is currently in procurement.

Southern Europe
Countries including Spain, Italy, Portugal
and Greece have PPP pipelines. While
some of these programmes may be viewed
as attractive in terms of their size and the
availability-based nature of the assets, the
credit rating of the counterparties and
certain risk transfer expectations make these
investment opportunities less attractive to the
Company. Consequently, these have not been
a focus for BBGI.

Australia
Australia has historically been a very reliable
investment market for availability-style
projects, which are vital to the development of
infrastructure in the country. The National PPP
Policy and Guidelines provide a consistent
framework for the public and private sector
to work together. The treasury departments
of some states have also issued their own
PPP guidelines. Furthermore, the central
state and territory governments produce
strategic infrastructure plans. The country has
presented a strong pipeline of PPP projects
since the establishment of the National PPP
Policy Framework in 2008.

In recent years, Australia has seen several very
large PPP transport deals come to market.
While the big projects are still being rolled out,
the role of private finance and the form it takes
has changed, due to a significant push back
from construction contractors over the risks
they were forced to assume.

The massive transport projects that began
rolling out in Australia from around 2015
onwards, including four Sydney metro rail
projects, had contracts that were largely based
on earlier, much smaller PPPs and risk allocation
structures which were arguably not appropriate
for larger complex projects. Significant cost
overruns and construction and commissioning
delays on several large projects, including
the New Royal Adelaide Hospital, Melbourne
Metro, and Sydney Light Rail have resulted

in dampened enthusiasm for PPP projects
amongst some builders and resulted in several
court cases between builders and the public
sector. This resulted in a period of diminished
participation by some builders.

Given Australia’s large pipeline of big build
projects and their importance to post-Covid
economic recovery, numerous Australian
governments began working more collaboratively
with construction partners. To maintain
enthusiasm amongst bidders, the level of risk
facing the builders was addressed, and these
contract changes are expected to become a
template for the Australian PPP market.

As a result of these adjustments by the
Government, the outlook for the market again
appears promising. At a total estimated cost
of AUD 15.8 billion, the North-East Link is the
largest infrastructure project to date in the
state of Victoria and features the largest PPP
in Australian history. Other states such as New
South Wales have indicated a continuing
interest in using the PPP model where
appropriate. New South Wales and Victoria,
the two biggest states, are each spending AUD
90 billion over four years on major projects.
There may be some projects coming up in
Queensland connected to Brisbane winning
the 2032 Summer Olympics. These include the
AUD 3-4 billion Sydney Metro Western Sydney
Airport PPP, due for final bids by the middle of
this year; and a winner to be picked for the AUD
3.5 billion-plus Inland Rail PPP in Queensland.

PPP was used as the delivery method for
upgrades to Frankston Hospital in Melbourne.
There will be some smaller social infrastructure
projects – likely to include another hospital
and social housing project in Victoria as well as
a possible defence deal in Sydney.

In addition to the aforementioned primary
opportunities, we expect some construction
companies may look to sell equity in projects
once the construction is completed and the
assets have been de-risked.

BBGI has three large operational assets in
Australia and will continue to monitor the market
for both primary and secondary opportunities.

Growth Outlook
Over the last decade, BBGI has been able
to grow its portfolio consistently, while also
maintaining price discipline. We expect this
trend to continue into 2022 and beyond.

We expect our growth to come predominantly
from secondary market opportunities
and in certain cases from primary bidding
opportunities.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTOperating and Financial Review

The Management Board is pleased to present the Operating and Financial Review for the
year ended 31 December 2021.

Highlights and Key Performance Indicators
Please see Financial Highlights for a summary of the Year in Numbers for 2021. Certain key performance indicators (‘KPIs’) for the last five years are
highlighted below:

KPI

Target

Dec-17

Dec-18

Dec-19

Dec-20

Dec-21 Commentary

Dividends (paid or
declared)

Progressive long-term
dividend growth in
pence per share

NAV per share

Compound annual
shareholder return
since IPO

Ongoing charge

Positive NAV per share
growth

7% to 8% on IPO issue
price of £1 per share

Competitive cost
position

Cash dividend cover

>1.0x

Refinancing risk
(as a percentage of
portfolio)

Minimise refinancing risk

6.50

6.75

7.00

7.18

7.33 Achieved: Second 2021
interim dividend of
3.665pps declared in
February 2022

3.0%

2.8%

2.0%

1.2%

2.1% Achieved

10.5%

11.2%

11.3%

11.0%

10.4% Achieved

0.99%

0.93%

0.88%

0.86%

0.86% Achieved

1.51x

1.50x

1.30x

1.27x

1.31x Achieved

6% Achieved: Northern

Territory Secure Facilities
is the only asset with
refinancing risk

Asset availability

> 98% asset availability

Yes

Yes Achieved

Single asset
concentration risk
(as a percentage of
portfolio value)

Availability-
based assets (as
a percentage of
portfolio)

To be less than 25%
of portfolio at time of
acquisition

Maximise availability-
based assets

12%
(GEB)

11%
(GEB)

10%
(GEB)

9%
(GEB)

11%
(ORB)

Achieved

100%

100% Achieved

Asset Management
Cash Performance
The Company’s portfolio of 54 availability-based infrastructure investments continued to perform well during the year with cash flows ahead of
forecast and the underlying financial models.

Construction exposure
The Company’s investment policy is to invest principally in assets that have completed construction and are operational. Accordingly, investment
in construction assets will be limited to 25 per cent. of the portfolio value. The rationale for this approach is to produce a stable dividend for
our shareholders, while at the same time gaining some exposure to the potential NAV uplift that occurs when assets move from a successful
construction stage to the operational stage. The Company has demonstrated in the past that it can manage such assets during the construction
period with a successful transition into a stable operational asset.

The Management Board believes that the Company’s ability to meet its dividend targets is not compromised by having some construction exposure.

As at 31 December 2021, c. 99.5 per cent. of the assets were operational with only one project, Highway 104 in Nova Scotia, Canada, under construction.

BBGI Global Infrastructure S.A. | Annual Report 2021

Operating and Financial Review continued

Investment performance

Returns track record
The Company’s share price maintained a strong premium to NAV throughout the year. Since the Company’s IPO in 2011, BBGI share price has
consistently maintained a premium to NAV, except for a brief period of volatility during the height of the market-wide sell-off in March 2020 due
to COVID-19. BBGI’s share price quickly rebounded after this initial adjustment phase, as investors realised that COVID-19 would have a limited
impact on BBGI’s future cash flows, which come exclusively from long-term availability-based government or government-backed contracts.

We continue to believe that a key benefit of the portfolio is the high-quality cash flows derived from long-term availability-based government or
government-backed contracts. As a result, the portfolio performance has been largely uncorrelated to the many wider macro-economic factors
that may cause market volatility in other sectors. Against the FTSE All-Share, the Company has shown a low five-year correlation of 28.1 per cent.
and a beta of 0.2519.

BBGI Share Price Performance

)
0
0
1
o
t
d
e
s
a
b
e
r
(
e
c
i
r
p
e
r
a
h
S

190

180

170

160

150

140

130

120

110

100

Dec
11

Jun
12

Dec
12

Jun
13

Dec
13

Jun
14

Dec
14

Jun
15

Dec
15

Jun
16

Dec
16

Jun
17

Dec
17

Jun
18

Dec
18

Jun
19

Dec
19

Jun
20

Dec
20

Jun
21

Dec
21

BBGI

FTSE All Share

The share price closed the year at 175.60pps, an increase of 0.9 per cent. (excluding dividends) in 2021, representing a 24.8 per cent. premium to
the NAV per share at the year-end.

TSR since IPO to 31 December 2021 was 171.1 per cent., or 10.4 per cent. on a compounded annual basis.

The total accounting return per share in the calendar year 2021 was 7.4 per cent20, with a dividend yield of 4.2 per cent.

Distribution policy
Distributions on ordinary shares are planned to be paid twice a year, normally in respect of the six months ended 30 June and the six months ended
31 December.

Dividends
On 1 April 2021, the Company paid a second interim dividend of 3.59pps for the period 1 July 2020 to 31 December 2020. The 2021 interim dividend of
3.665pps was paid on 21 October 2021. In February 2022, subsequent to the year-end, the Company declared a second interim dividend of 3.665pps
in respect of the six-month period ended 31 December 2021. This resulted in a total dividend of 7.33pps for the year ended 31 December 2021.

We are reaffirming our progressive dividend policy with target dividends of 7.48pps and 7.63pps for 2022 and 2023, respectively. We are also
pleased to introduce a new dividend target for 2024 of 7.78pps.

19 The FTSE All-Share, five-year data represents the five years preceding 31 December 2021.
20 Refer to the Alternative Performance Measurement section of this Annual Report for further details.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT

Operating and Financial Review continued

Proven progressive dividend policy

3 . 3% average increase

5.50

5.76

6.00

6.25

6.50

6.75

7.00

7.18

7.33

7.48

7.63

7.78

e
r
a
h
s
r
e
p
e
c
n
e
P

8.00
8.00

7.00
7.00

6.00
6.00

5.00
5.00

4.00
4.00

3.00
3.00

2.00
2.00

1.00
1.00

0.00
0.00

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022
Target

2023
Target

2024
Target

– Average annual dividend increase of 3.3 per cent. from 2012 to 2021

–

FY 2022 target dividend of 7.48pps21, up 2.0 per cent.

FY 2023 target dividend of 7.63pps21

FY 2024 target dividend of 7.78pps21

Investor communications
The Company places great importance on communication with its shareholders and welcomes their views. The Company intends to remain at the
forefront of disclosure and transparency in its asset class, and therefore the Management Board and, where appropriate, the Supervisory Board,
regularly review the level and quality of the information that the Company makes public.

The Company formally reports twice a year through the Annual and Interim Reports. Other current information on the Company is provided
through the Company’s website and through market announcements. At shareholder General Meetings each share is entitled to one vote, all votes
validly cast at such meetings (including by proxy) are counted, and the Company announces the results on the day of the relevant meeting.

The Management and Supervisory Boards are keen to develop and maintain positive relationships with the Company’s shareholders. As part of
this process, immediately following release of the Annual and Interim Reports at the end of March and August each year, the Co-CEOs present the
Company’s results to market analysts and subsequently conduct investor roadshows and offer shareholder meetings to discuss the results, explain
the ongoing strategy of the Company, and receive feedback.

Outside of these formal meetings, feedback from investors is received via the Management Board and the corporate brokers and, together with the
feedback from results meetings, this feedback is reported to the Supervisory Board. Throughout the year under review, the Co-CEOs have made
themselves available to shareholders and key sector analysts, for discussion of key issues and expectations around Company performance. The
Co-CEOs will continue to make themselves available to meet with shareholders periodically to facilitate an open two-way communication on the
development of the Company. Shareholders may contact members of both the Management and Supervisory Boards at the registered office of the
Company, the address for which can be found on the final page of the Annual Report or on the Company’s website at www.bb-gi.com.

While shareholder engagement is typically conducted by the Co-CEOs, it should be noted that the Chair also makes herself available throughout
the year to understand the views of shareholders on governance and performance matters.

In addition, during the year, the Company undertook a comprehensive stakeholder materiality assessment among our employees, shareholders,
clients, partners, subcontractors and suppliers to produce ten material topics influencing our ESG strategy. Significant investor input was solicited
and considered. These ten topics have informed key ESG commitments and KPIs that we are now tracking to ensure incremental progress in our
delivery of positive stakeholder outcomes.

Given this level of engagement with shareholders and stakeholders, the Management and Supervisory Boards consider that they meet the
requirements of AIC Code of Corporate Governance Principle 5D.

21 These are targets only and are not a profit forecast. There can be no assurance that these targets will be met or that the Company will make any distribution at all.

BBGI Global Infrastructure S.A. | Annual Report 2021

Operating and Financial Review continued

Share capital
The issued share capital of the Company is 712,125,805 ordinary shares of no-par value. All of the ordinary shares issued rank pari passu. During the
year ended 31 December 2021, the Company issued 47,434,522 shares.

Voting rights
There are no special voting rights, restrictions or other rights attached to any of the ordinary shares. There are no restrictions on the voting rights
attaching to ordinary shares.

Discount management
Although the Company’s shares have continuously traded at a premium since IPO in December 2011, except for a brief period in March 2020, the
Management Board will actively monitor any discount to the NAV per share at which the ordinary shares may trade in the future. The Management
Board will report to the Supervisory Board on any such discount and propose actions to mitigate this.

Purchase of ordinary shares by the Company in the market
In order to assist in the narrowing of any discount to the NAV at which the ordinary shares may trade from time to time and/or to reduce discount
volatility, the Company may, subject to shareholder approval:

– make market purchases of up to 14.99 per cent. annually of its issued ordinary shares; and

–

make tender offers for ordinary shares.

No shares have been bought back during the year ended 31 December 2021. The most recent authority to purchase ordinary shares, which may
be held in treasury or subsequently cancelled, was granted to the Company on 30 April 2021. This authority expires on the date of the next Annual
General Meeting (‘AGM’) to be held on 29 April 2022, at which point the Company will propose that its authority to buy back ordinary shares be
renewed.

Continuation vote
The Company’s Articles of Association (‘Articles’) requires the Boards to offer a continuation vote to the Company’s shareholders at every second
AGM to allow the Company to continue in its current form. On 30 April 2021, at the Company’s AGM, the shareholders voted unanimously for the
continuation of the Company. In accordance with the Articles, a further continuation vote will be offered to shareholders at the AGM due to be held
on 28 April 2023.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTValuation

The Management Board is responsible for carrying out the fair market valuation of the Company’s investments, which it then presents to the
Supervisory Board for consideration as part of its approval of this Annual Report. The valuation is undertaken on a six-monthly basis as at 30 June
and 31 December each year, and is reviewed by an independent third-party valuation expert.

The Company’s investments are principally non-market traded investments with predictable long-term contracted cash flows; therefore, the
valuation is determined using the discounted cash flow methodology. The Company makes forecast assumptions for key macro-economic factors
impacting upon the cash flow forecasts of investments such as inflation rates and deposit rates based on market data, publicly available economic
forecasts and long-term historical averages, and adjusts for any enacted changes in taxation during the reporting period. In addition, the Company
exercises its judgement in assessing the expected future cash flows from each investment based on the detailed financial models produced by
each Portfolio Company, adjusting these financial models where necessary to reflect the Company’s assumptions as well as any specific cash-flow
assumptions. The Company’s valuation is a sum-of-the-parts valuation with no further adjustments made to reflect scale, scarcity or diversification
of the overall portfolio.

The fair value for each investment is then derived from the application of an appropriate discount rate, alongside reporting period-end currency
exchange rates and withholding taxes (as applicable). The discount rate considers risks associated with the investment, including the phase of the
investment (construction, ramp-up or stable operation), investment-specific risks and opportunities, as well as country-specific factors. The Company
uses its judgement in determining the appropriate discount rates. This judgement is based on its knowledge of the market, considering information
obtained from its investment and bidding activities, benchmark analysis with comparable companies and sectors, discussions with advisers in the
relevant markets and publicly available information. The valuation methodology remains unchanged from previous reporting periods.

A breakdown of the movements in the net asset value is shown in the chart below.

NAV movement 31 December 2020 to 31 December 2021
The Company’s net asset value at 31 December 2021 was £1,001.6 million (31 December 2020: £916.0 million), representing an increase of 9.4 per cent.

1,015

995995

975

955

935

915

916.0

895

875

)
n
o

i
l
l
i

m
P
B
G

(
e
u
l
a
v
o

i
l

o
f
t
r
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P

79.2

14.5

13.1

59.8

(10.3)

(3.2)

975.2

26.4

1,001.6

(20.3)

895.7

(73.5)

901.3

% change in NAV

6.5%

1.6%

(1.1)%

1.4%

(0.3)%

Net
Asset Value
as at 31 Dec
2020

Less other
net assets
as at
31 Dec
2020(i)

Acquisitions(ii) Distrib-
utions(iii)

Portfolio
value as at
31 December
2020

Unwinding
of discount

Rebased
opening
portfolio value
as at
1 January 2021

Change in
market
discount
rate

Change
in macro-
economic
assumptions

Value
Enhance-
ments

Foreign
exchange
loss (iv)

Portfolio
value
31 Dec
2021

Other net
assets as
at 31 Dec
2021(i)

Net Asset
Value as
at 31 Dec
2021

(i) These figures represent the net assets of the Group after excluding the investments at fair value through profit or loss (‘Investments at FVPL’). Refer to the Pro Forma

Balance Sheet in the Financial Results section of this Annual Report for further breakdown.

(ii) Refer to the Operating model in action section of this Annual Report for further details on acquisitions during the year.
(iii) While distributions from Investments at FVPL reduce the portfolio value, there is no impact on the Company’s NAV as the effect of the reduction in the portfolio value is

offset by the receipt of cash at the consolidated Group level. Distributions in the above graph are shown net of withholding tax.

(iv) The result from balance sheet hedging is recorded at the consolidated Group level under Other net assets. Therefore, while inversely correlated to foreign exchange

movements on the portfolio value, balance sheet hedging does not directly impact the portfolio value but rather creates an offset at the fund level.

Key drivers for NAV change
The rebased opening portfolio value after considering acquisitions in the reporting period of £79.2 million and cash distributions from investments
of (£73.5) million was £901.3 million.

Unwinding the discount and value enhancements:
During the period, the Company recognised £72.9 million, or an 8.0 per cent. increase in NAV, from the unwinding of discounts and value accretive
enhancements. As the Company moves closer to forecasted investment distribution dates, the time value of those cash flows increases on a net present
value basis. The portfolio value growth from unwinding of discount during the period was approximately £59.8 million or a 6.5 per cent. change in NAV.

BBGI Global Infrastructure S.A. | Annual Report 2021

Valuation continued

The remaining £13.1 million, or a 1.4 per cent. change in NAV, represents inter alia the net effect of value accretive enhancements across the
portfolio through active management. During the year and given the low interest rate environment, the Company was able to refinance four
investments, representing over £515 million of new senior debt and bonds, optimising the financial structure of each relevant Portfolio Company
with lower-cost long-term financing, and the net valuation effect of enhanced operational performance through our active and hands-on asset
management approach. The activities involved inter alia managing change orders and earning a projected fee for these services, cost savings
due to lower fees on management service agreements and operations and maintenance agreements, and changes in lifecycle costs. The value
enhancements also include the net positive effect of actual inflation against the 31 December 2020 modelled macro-economic assumptions.

Change in discount rate:
The market for availability-based transactions continues to be very competitive and discount rates have compressed further during the reporting period.
This is the result of a continued low-interest environment and high investment demand in the availability-based social infrastructure sector, while the
supply of new greenfield infrastructure investments is not keeping pace. Based on data from transactional activity, benchmark analysis with comparable
companies and sectors, discussions with advisers in the relevant markets, and publicly available information, BBGI has reduced its weighted average
discount rate to approximately 6.55 per cent. (31 December 2020: 6.77 per cent.), representing a reduction of 22 bps from 31 December 2020.

Change in macro-economic assumptions:
During the year, the Company recognised a reduction in the portfolio value due to changes in the macro-economic assumptions, mainly due to
a change in the UK corporate tax rate resulting in a portfolio value decrease of £8.9 million, or a 1.0 per cent. decrease in NAV, and a reduction in
short-term deposit rates resulting in a portfolio value decrease.

In total, the Company recognised a reduction of £10.3 million, or a 1.1 per cent. decrease in NAV, from changes in these assumptions.

Foreign Exchange:
The forecasted distributions from investments are converted to pounds Sterling at either the hedged rate, for a predetermined percentage of cash
flows forecast to be received over the next four years, or at the closing rate for unhedged future cash flows.

A significant proportion of the Company’s underlying investments are denominated in currencies other than pounds Sterling. The Company
maintains its accounts, prepares the valuation and pays dividends in pounds Sterling. Accordingly, fluctuations in exchange rates between pounds
Sterling and the relevant local currencies will affect the value of the Company’s underlying investments.

During the year ended 31 December 2021, the depreciation of pounds Sterling against the Canadian Dollar and the US Dollar, and the appreciation
of pounds Sterling against the Australian Dollar, the Euro, and the Norwegian Krone accounted for a net decrease in the portfolio value of £3.2
million. Since IPO in December 2011, the net cumulative effect of foreign exchange movements on the portfolio value, after considering the effect
of balance sheet hedging, has been a decrease of £11.8 million, or 1.2 per cent. of the 31 December 2021 NAV.

The table below shows those closing rates, which were used to convert unhedged future cash flows into the reporting currency at 31 December 2021.

GBP/

AUD

CAD

EUR

NOK

USD

Valuation impact

FX rates as of 31 December 2021

FX rates as of 31 December 2020

FX rate change

1.861

1.716

1.191

11.911

1.351

1.771

1.739

1.113

11.670

1.365

(5.06)%

1.33%

(7.02)%

(2.07)%

1.01%

Although the closing rate is the required conversion rate to use, it is not necessarily representative of future exchange rates as it reflects a specific
point in time.

The Group uses forward currency swaps to (i) hedge 100 per cent. of forecasted cash flows over the next four years on an annual rolling basis and (ii) to
implement balance sheet hedging in order to limit the decrease in the NAV to approximately three per cent. for a ten per cent. adverse movement in
foreign exchange rates22. This is achieved by hedging a portion of the non-pounds Sterling and non-Euro portfolio value23. The effect of the Company’s
hedging strategy can also be expressed as a theoretical or implicit portfolio allocation to pounds Sterling exposure. In other words, on an unhedged
basis, the portfolio allocation to pounds Sterling exposure at 31 December 2021 would need to be approximately 71 per cent. to obtain the same NAV
sensitivity to a ten per cent. adverse change in foreign exchange rates as shown in the Foreign Exchange Sensitivity table below.

22 Based on the portfolio composition on the date the balance sheet hedge contracts are entered into.
23 The Company assumes an equal and offsetting amount between running costs and Euros received into the future.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTValuation continued

COVID-19
The portfolio continued its strong performance over the reporting period with no reported material adverse effect on valuation resulting from
COVID-19. This strong performance is primarily as a result of the Company holding a low-risk, 100 per cent. availability-based portfolio, coupled with
strong stakeholder collaboration. We will continue to work closely with all stakeholders to help mitigate the risks and effects of this global pandemic.

Discount rates
The discount rates used for individual investments range between 6.00 per cent. and 8.58 per cent. The weighted average rate is approximately
6.55 per cent. (31 December 2020: 6.77 per cent.), representing a reduction of 22 bps from 31 December 2020, which management believes to
be towards the conservative end of the range for a portfolio of availability-based social infrastructure investments. This methodology calculates
the weighted average based on the value of each investment in proportion to the total portfolio value i.e. based on the net present value of their
respective future cash flows.

Specific discount rates consider risks associated with the investment including the phase the investment is in, such as construction, ramp-up or
stable operation, investment-specific risks and opportunities as well as country-specific factors.

BBGI applies a risk premium for investments in construction to reflect the higher-risk inherent in the construction phase of any investment’s lifecycle.
Currently, the portfolio has one investment in construction, Highway 104, which represents c. 0.5 per cent. of the overall portfolio value. BBGI has
also applied a risk premium to a limited number of other investments to reflect the individual situations. For example, adjustments have been applied
to acute hospitals in the UK where a risk premium of 50bps continues to be applied. The only UK acute hospital in the portfolio is Gloucester Royal
Hospital, which represents less than 1.0 per cent. of the overall NAV. The risk premium reflects the continued situation in the UK where some public
health clients are under cost pressure and are actively looking for cost savings including deductions. To date, BBGI has not been affected.

General market activity
Through the course of the COVID-19 pandemic, there has been an increased focus on valuation from investors as the varied risk profiles of the
different investment classes within the infrastructure sector have become more pronounced. For example, demand-based investments such as
airports, and toll roads have generally suffered severe traffic reductions, thereby reducing revenue. Investors in demand-based investments have
revisited traffic growth assumptions, at least in the short-term. In addition, lower than forecasted volumes will not only impact demand-based
income but also other third-party income such as retail business in airports and rail stations, motorway service stations and other income sources
reliant on customer volume.

On the other hand, availability-based investments passed the stress test and proved to be very robust as the sector has not experienced any
material negative impact. This, coupled with the historic prolonged low interest rate environment, has further contributed to increased competition
for availability-based investments. The transaction volume in 2021 shows that demand for stable yielding investments is strong, even with the
ambiguity surrounding COVID-19 remaining, and market intelligence suggests discount rates in the very competitive secondary market are likely to
decrease further in the short-term.

Macro-economic assumptions
Apart from the discount rates, the Company uses the following assumptions (‘Assumptions’) for the cash flows:

Inflation

UK(i) RPI/CPIH

Canada

Australia

Germany

Netherlands(ii)

Norway(ii)

US(iii)

Movement

31 December 2021

31 December 2020

2.75% / 2.00%

2.00% / 2.35%

2.75% / 2.00%

2.00% / 2.35%

2.50%

2.00%

2.25%

2.50%

2.00%

2.25%

2.50%

BBGI Global Infrastructure S.A. | Annual Report 2021

Valuation continued

Deposit rates (p.a.)

Corporate tax rates (p.a.)

Canada

Australia

Germany

Movement

31 December 2021

31 December 2020

0.00% to Q4 2023, then 1.00% 0.25% to Q4 2023, then 1.00%

0.50% to Q4 2023, then 1.50% 0.75% to Q4 2023, then 1.50%

0.25% to Q4 2023, then 2.00% 0.50% to Q4 2023, then 2.00%

0.00% to Q4 2023, then 0.50% 0.00% to Q4 2023, then 0.50%

Netherlands

0.00% to Q4 2023, then 0.50% 0.00% to Q4 2023, then 0.50%

Norway

UK(iv)

Canada(v)

Australia

Germany(vi)

Netherlands(vii)

Norway

0.00% to Q4 2023, then 2.00% 0.25% to Q4 2023, then 2.00%

0.00% to Q4 2023, then 1.50% 0.25% to Q4 2023, then 1.50%

19.0% to Q1 2023, then 25.0%

19.0%

23.0% / 26.5% / 27.0% / 29.0% 23.0% / 26.5% / 27.0% / 29.0%

30.0%

15.8% (incl. solidarity charge)

25.8%

22.0%

21.0%

25.0%

22.0%

21.0%

(i) On the 25 November 2020, the UK Government announced the phasing out of RPI after 2030, and replacement with CPIH; the Company’s UK portfolio indexation factor

changes from RPI to CPIH beginning on 1 January 2031.

(ii) CPI indexation only. Where investments are subject to a basket of indices, a projection for non-CPI indices are used.
(iii) 80 per cent. of Ohio River Bridges investment indexation factor for revenue is contractual and is not tied to CPI.
(iv) On 10 June 2021, the UK Government enacted an increase in the UK Corporate Tax rate to 25.0 per cent. with effect from April 2023.
(v) Individual tax rates vary among Canadian Provinces: Alberta; Ontario, Quebec, Northwest Territory; Saskatchewan, British Columbia; New Brunswick.
(vi) Individual local trade tax rates are considered in addition to the tax rate above.
(vii) On 21 December 2021, the Dutch Government enacted an increase in the Corporate Tax rate to 25.8% with effect from 1 January 2022.

Sensitivities

Discount rate +/- 1%

Inflation rate -/+ 1%

Foreign Exchange +/- 10%

Short-term inflation rate to 5% for 2022 and 2023

Combined +1% inflation, deposit rates, and discount rates

Lifecycle costs +/- 10%

Deposit rate -/+ 1%

Corporate tax rate +/- 1%

Senior Debt refinancing margin + 1%

GDP -/+ 0.5%

-7.8%

9.0%

-3.3%

-2.8%

-2.3%

3.9%

3.1%

2.6%

-1.9%

2.0%

-1.7%

1.7%

-0.9%

0.9%

-0.6%

0.0%

-10%

-8%

-6%

-4%

-2%

10%

Positive change in variable

Negative change in variable

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT

Valuation continued

Discount rate sensitivity
The weighted average discount rate that is applied to the Company’s portfolio of investments is the single most important judgement and variable.

The following table shows the sensitivity of the NAV to a change in the discount rate.

Discount Rate Sensitivity(i)

Increase by 1% to c. 7.55%

Decrease by 1% to c. 5.55%

(i) Based on the weighted average discount rate of 6.55 per cent.

Change in NAV 31 December 2021

(£78.1) million, i.e. (7.8)%

£89.9 million, i.e. 9.0%

Inflation has increased in all jurisdictions across BBGI’s geographies and interest rates are expected to rise from historical lows. In the event long
term interest rates rise substantially this may have an effect on discount rates.

It is reasonable to assume if discount rates increase then deposit rates and inflation rates would also increase. To illustrate the effect of this
combined movement on the Company’s NAV, a scenario was created assuming a 1 per cent. increase in the discount rate to 7.55 per cent., and a 1
per cent. increase in both deposit and inflation rates above the macro-economic assumptions.

Combined Sensitivity: discount, inflation and deposit rates

Change in NAV 31 December 2021

Increase by 1%

(£23.1) million, i.e. (2.3)%

Inflation sensitivity
The Company’s investments are contractually entitled to receive availability-based income streams from public sector clients, which are adjusted
every year for inflation. Facilities management subcontractors, for accommodation investments, and operating and maintenance subcontractors,
for transport investments, have similar indexation arrangements. The portfolio cash flows are positively correlated with inflation (e.g. RPI, CPI, or a
basket of indices).

BBGI’s equity cash flows are positively correlated to inflation at c. 0.44. This means that if long-term inflation was to be 1% higher than the
Company’s assumptions for all future periods, the Company’s returns would increase from 6.55% to 6.99%

This inflation linkage is achieved through contractual indexation mechanics in the various project agreements with the public sector clients at the
portfolio companies and the inflation adjustment updated at least annually.

The table below shows the sensitivity of the NAV to a change in inflation rates compared to the assumptions in the table above:

Inflation Sensitivity

Inflation +1%

Inflation −1%

Change in NAV 31 December 2021

£39.5million, i.e. 3.9%

(£32.6) million, i.e. (3.3)%

Short term inflation sensitivity
As a result of the current macro-economic environment and the positive inflation linkage of the investments, the Company recognises that
changes in short-term inflation rates compared to the 31 December 2021 modelled macro-economic assumptions will have an effect on the NAV.
The table below shows the sensitivity of the NAV to a change in short-term inflation rates compares to the assumptions in the table above:

Short-term Inflation Sensitivity

Increased to 5% for 2022 and 2023

Change in NAV 31 December 2021

£26.4 million, i.e. 2.6%

Foreign exchange sensitivity
As described above, a significant proportion of the Company’s underlying investments are denominated in currencies other than pounds Sterling.

The following table shows the sensitivity of the NAV to a change in foreign exchange rates:

Foreign Exchange Sensitivity(1)

Increase by 10%

Decrease by 10%

Change in NAV 31 December 2021

(£28.4) million, i.e. (2.8)%

£31.1 million, i.e. 3.1%

(1) Sensitivity in comparison to the spot foreign exchange rates at 31 December 2021 and considering the contractual and natural hedges in place, derived by applying a 10 per

cent. increase or decrease to the pounds Sterling/foreign currency rate.

BBGI Global Infrastructure S.A. | Annual Report 2021

Valuation continued

Deposit rate sensitivity
Portfolio Companies typically have cash deposits that are required to be maintained as part of the senior debt funding requirements (e.g. six-month
debt service reserve accounts, maintenance reserve accounts). The asset cash flows are positively correlated with the deposit rates.

The table below shows the sensitivity of the NAV to a percentage-point change in long-term deposit rates compared to the assumptions in the
table above:

Deposit Rate Sensitivity

Deposit rate +1%

Deposit rate −1%

Change in NAV 31 December 2021

£17.3 million, i.e. 1.7%

(£17.2) million, i.e. (1.7)%

Lifecycle costs sensitivity
Lifecycle costs are the cost of planned interventions or replacing material parts of an asset to maintain it over the concession term. They involve
larger items that are not covered by routine maintenance, and for roads, it will include items such as replacement of asphalt, rehabilitation of
surfaces, or replacement of electromechanical equipment. Lifecycle obligations are generally passed down to the facility maintenance provider,
with the exception of transportation investments, where these obligations are typically retained by the Portfolio Company.

Of the 54 investments in the portfolio at year-end, 19 investments retain the lifecycle obligations. The remaining 35 investments have this
obligation passed down to the subcontractor.

The table below shows the sensitivity of the NAV to a change in lifecycle costs:

Lifecycle Costs Sensitivity(i)

Increase by 10%

Decrease by 10%

Change in NAV 31 December 2021

(£19.0) million, i.e. (1.9)%

£19.6 million, i.e. 2.0%

(i) Sensitivity applied to the 19 investments in the portfolio which retain the lifecycle obligation i.e. the obligation is not passed down to the subcontractor.

Corporate tax rate sensitivity
The profits of each Portfolio Company are subject to corporation tax in the country where the Portfolio Company is located.

The table below shows the sensitivity of the NAV to a change in corporate tax rates compared to the assumptions in the table above:

Corporate Tax Rate Sensitivity

Tax rate +1%

Tax rate −1%

Change in NAV 31 December 2021

(£8.8) million, i.e. (0.9)%

£8.7 million, i.e. 0.9%

Senior debt refinancing sensitivity
Assumptions are used where a refinancing of senior debt financing is required for an investment during the remaining investment concession term.
There is a risk that such assumptions may not be achieved.

The table below shows the sensitivity of the NAV to a +100bps adjustment to the forecasted margins. The base rate for senior debt is either fixed or
a long-term interest swap is available with the effect that none of our investments are subject to changes in base rates.

Senior Debt Refinancing Sensitivity(i)

Margin +1%

Change in NAV 31 December 2021

(£6.3) million, i.e. (0.6)%

(i) The Northern Territory Secure Facilities investment is the only remaining investment in the BBGI portfolio with a refinancing risk.

Gross Domestic Product (‘GDP’) sensitivity
The BBGI portfolio is not sensitive to GDP.

The principal risks faced by the Group and the mitigants in place are outlined in the Risk section.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTValuation continued

Key Portfolio Company and portfolio cash flow Assumptions underlying NAV calculation include:
– Discount rates and the Assumptions, as set out above, continue to be applicable.

–

The updated financial models used for valuation accurately reflect the terms of all agreements relating to the Portfolio Companies and
represent a fair and reasonable estimation of future cash flows accruing to the Portfolio Companies.

– Cash flows from and to the Portfolio Companies are received and made at the times anticipated.

– Non-UK investments are valued in local currency and their cash flows converted to pounds Sterling at either the period-end exchange rates or

at the contracted hedge rate.

– Where the operating costs of the Portfolio Companies are fixed by contract, such contracts are performed, and where such costs are not fixed,

they remain within the current forecasts in the valuation models.

– Where lifecycle costs/risks are borne by the Portfolio Companies, they remain in line with the current forecasts in the valuation models.

– Contractual payments to the Portfolio Companies remain on track, and contracts with public sector or public sector backed counterparties are

not terminated before their contractual expiry date.

– Any deductions or abatements during the operational period of Portfolio Companies are fully passed down to subcontractors under

contractual arrangements or are part of the planned (lifecycle) forecasts.

– Where the Portfolio Companies own the residual property value in an investment, the projected amount for this value is realised.

–

In cases where the Portfolio Companies have contracts that are in the construction phase, they are either completed on time or any delay costs
are borne by the construction contractors.

Enacted tax or regulatory changes on or prior to the reporting period-end with an effect in the future which negatively impact cash flow
forecasts are reflected in the financial models.

In forming the above assessments, BBGI works with Portfolio Company management teams, as well as using due diligence information from, or
working with, suitably qualified third parties such as technical, legal, tax and insurance advisers.

BBGI Global Infrastructure S.A. | Annual Report 2021

Financial Results

The Consolidated Financial Statements of the Group for the year ended 31 December 2021 are on pages 96 to 100.

Basis of accounting
The Group has prepared its Consolidated Financial Statements in accordance with International Financial Reporting Standards (‘IFRS’) as
adopted by the European Union (‘EU’). In accordance with IFRS, the Company qualifies as an Investment Entity and as such, does not consolidate
its investments in subsidiaries that qualify as Investments at FVPL. Certain subsidiaries that are not Investments at FVPL, but instead provide
investment-related services or activities that relate to the investment activities of the Group, are consolidated. As an investment entity, the
Company recognises distributions from investments at FVPL as a reduction in their carrying value. These distributions reduce the estimated future
cash flows which are used to determine the fair value of the investments at FVPL.

Income and Costs
Pro forma Income Statement

Income from investments at fair value through profit or loss (‘FVPL income’)

Other operating income

Operating income

Administrative expenses

Other operating expenses

Net loss on balance sheet hedging and net finance result

Profit before tax

Tax expense - net

Profit from continuing operations

Other comprehensive income

Total comprehensive income

Basic earnings per share (pence)

Year ended
31 Dec 21
£ million

Year ended
31 Dec 20
£ million

75.4

0.7

76.1

(10.2)

(2.5)

(2.7)

60.7

(2.7)

58.0

(0.6)

57.4

8.47

63.3

0.2

63.5

(9.6)

(7.3)

(2.3)

44.3

(2.6)

41.7

–

41.7

6.58

During the year, the Group recognised FVPL income of £75.4 million (31 December 2020: £63.3 million). This FVPL income is made up of a
combination of the positive effect of the unwinding of discount, changes in market discount rates, value enhancements, with a partial offset
resulting from changes in macro-economic assumptions and the net effect of foreign exchange on the underlying investment portfolio. A more
detailed analysis of the movement in Investments at FVPL is provided in the Valuation section of this Report.

Administrative expenses include personnel expenses, legal and professional fees and office and other administrative expenses. See further detail in
the Group Level Corporate Cost analysis.

Other operating expenses include acquisition-related costs, net loss on cash-flow hedging, and net foreign currency exchange loss, if applicable. During
the year ended 31 December 2021, the Company recognised a gain of £0.4 million on foreign exchange revaluation (31 December 2020: £4.8 million loss).

Profit from continuing operations for the year ended 31 December 2021 increased by 39.1 per cent. to £58.0 million (31 December 2020: £41.7 million).

Group Level Corporate Cost Analysis
The table below is prepared on an accrual basis.

Corporate costs

Net finance result

Personnel expenses

Legal and professional fees

Office and administration

Acquisition-related costs

Taxes

Corporate costs

Year ended
31 Dec 21
£ million

Year ended
31 Dec 20
£ million

2.0

6.9

2.5

0.8

1.5

2.7

1.6

6.2

2.6

0.8

1.6

2.6

16.4

15.4

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT
Financial Results continued

The net finance result for the year was £2.0 million (31 December 2020: £1.6 million) and reflects borrowing costs, commitment fees and other fees
relating to the Group’s RCF. The RCF was amended and restated during the year increasing the total commitment from £180 million to £230 million
limit and extending the maturity to May 2026. The Company used investment distributions and the net proceeds from the July 2021 share placing
to repay outstanding amounts on the RCF.

Personnel expenses for the year were £6.9 million (31 December 2020: £6.2 million) reflecting, among others, the annualised effect of the triennial
Management Board remuneration review, an increase in staff numbers as well as statutory and discretionary increases in staff remuneration. Refer
to the ‘Remuneration Report’ section of this report for further detail on Management Board and Supervisory Board remuneration.

Acquisition-related costs incurred during the year amounted to £1.5 million (31 December 2020: £1.6 million) and includes unsuccessful bid costs
amounting to £0.7 million (31 December 2020: £0.8 million).

Ongoing Charges
The Ongoing Charges (‘OGC’) percentage presented in the table below is prepared in accordance with the AIC recommended methodology,
latest update published in October 202024.

Ongoing Charges Information

Ongoing Charges (using AIC recommended methodology)

Year ended
31 Dec 21
£ million

Year ended
31 Dec 20
£ million

0.86%

In accordance with the AIC recommended methodology, fees that are linked to investment performance could be viewed as analogous to
performance fees paid by externally managed investment companies and should therefore be excluded from the principal OGC calculation.

Fees directly linked to investment performance recorded in 2021 as a percentage of average NAV were 0.10% (2020: 0.08%). Combined, the
aggregate of Ongoing Charges plus investment performance fees was 0.96% in the year (2020: 0.94%).

For the year ended 31 December 2021, and in line with AIC recommendations, certain non-recurring costs were excluded from the Ongoing
charges, most notably acquisition-related advisory costs of £1.5 million, taxes of £2.7 million and the net finance result of £2.0 million.

The table below provides a reconciliation of Ongoing Charges and the Ongoing Charges Percentage to the administration expenses under IFRS.

Administration expenses to 31 December

Less: Non-recurring costs as per AIC guidelines

Non-recurring professional and external advisory costs

Personnel costs related to acquisition or non-recurring

Compensation linked to investment performance

Other non-recurring costs

Ongoing charges

Divided by:

Average undiluted Investment Basis NAV for 2021 (average of 31

December 2021: £1,001.6 million and 30 June 2021: £918.1 million) million)

Ongoing Charges percentage(i)

(i) Percentage calculation is based on actual results rather than rounded numbers

Year ended 31
Dec 21 £million
(except %)

Year ended 31
Dec 20 £million
(except %)

10.2

9.6

(0.2)

(0.9)

(1.0)

8.3

(0.4)

(0.8)

(0.3)

7.7

959.9

0.86%

888.4

0.86%

24 Additional information regarding Ongoing Charges and ongoing charges percentage can be obtained from the AIC website www.theaic.co.uk.

BBGI Global Infrastructure S.A. | Annual Report 2021

Financial Results continued

Cash flows
The table below summarises the sources and uses of cash and cash equivalents for the Group:

Distributions received from Investments at FVPL(i)

Operating cash outflows

Additional Investments at FVPL

Realised hedging loss on investing activities

Net cash flows from financing activities

Impact of foreign exchange on cash and cash equivalents

Net cash inflow (outflow)

Year ended
31 Dec 21
£ million

Year ended
31 Dec 20
£ million

75.1

(12.1)

(79.2)

(1.6)

24.3

(0.2)

6.3

72.8

(17.8)

(59.2)

(0.7)

(9.5)

0.2

(14.2)

(i) These distributions are shown gross of withholding tax. The associated withholding tax outflow is included in ‘Net cash flows used in operating activities’.

The Group’s portfolio of investments performed well during the year, with cash flows ahead of the business plan. Distributions from Investments at
FVPL increased during the year by 3.2 per cent. to £75.1 million.

Additional investments during the year were financed through a combination of borrowings under the RCF, placing proceeds and reinvestment of
distributions received from Investments at FVPL.

The Company borrowed a total of £67.0 million under the RCF during the year, which was fully repaid as at 31 December. The net proceeds from the
July 2021 capital raise were used to part finance the acquisitions during the year and to repay those amounts borrowed under the RCF.

Cash dividends paid during the year ended 31 December 2021 amounted to £48.0 million, an increase of £5.3 million on the previous year.

The Consolidated Statement of Cash Flows provides further details of cash flows during the year ended 31 December 2021.

For the year ended 31 December 2021, the Group has a cash dividend cover ratio of 1.31x (year ended 31 December 2020: 1.27x) and is calculated as follows:

Distributions received from Investments

Less: Net cash flows from operating activities under IFRS (consolidated)

Net distributions

Divided by: Cash dividends paid under IFRS (consolidated)

Cash Dividend Cover (ratio)

31 Dec 21
£ million
(except ratio)

31 Dec 20
£ million
(except ratio)

75.1

(12.1)

63.0

48.0

1.31x

72.8

(18.5)

54.3

42.6

1.27x

The strong cash dividend coverage in 2021 was again supported by BBGI’s contracted portfolio cash flows which, unlike demand-based assets, are
not sensitive to the performance of the wider economic environment. The Company has reaffirmed the target dividend of 7.48pps for 2022 and 7.63
pps for 2023 and is pleased to introduce a new target for 2024 of 7.78pps.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTFinancial Results continued

Pro Forma Balance Sheet

Investments at FVPL

Trade and other receivables

Other assets and liabilities (net)

Net cash

Derivative financial asset (liability)

Investment
Basis(i)
£ million

975.2

1.0

(2.4)

26.9

0.9

NAV attributable to ordinary shares

1,001.6

31 December 2021

31 December 2020

Adjust
£ million

Consolidated
IFRS
£ million

Investment
Basis
£ million

Adjust
£ million

Consolidated
IFRS
£ million

–

(1.1)

975.2

895.7

1.0

(2.4)

26.9

(0.2)

1,000.5

1.6

(1.9)

20.5

0.1

916.0

–

(0.1)

–

(0.1)

(0.2)

895.7

1.6

(2.0)

20.5

–

915.8

(i) Represents the value of the Group’s total assets less the value of its total liabilities under the Investment Basis NAV. The Investment Basis NAV represents the residual

interest of the shareholders in the Group, after all the liabilities of the Group, if any, have been settled.

As at 31 December 2021, the Group has 54 availability-based Investments at FVPL (31 December 2020: 50).

At 31 December 2021, the fair value of forward currency swaps used to hedge future portfolio distributions over the next four years was £1.1 million
net liability position. This figure is excluded under the Investment Basis NAV as the related contracted forward rates are directly applied to hedged
future distributions and therefore embedded in the Investments at FVPL. The unhedged distributions are converted at the 31 December 2021
closing rate.

As at 31 December 2021, cash and cash equivalents amounted to £26.9 million (£20.5 million as at 31 December 2020).

A reconciliation of net cash as compared to net borrowings is as follows:

Cash and cash equivalent

Loans and borrowings

Less: Interest payable

Outstanding loan drawdowns

Net cash

Three-year comparative of Investment Basis NAV

NAV (millions)

NAV per share (pence)

31 Dec 21
£ million

31 Dec 20
£ million

26.9

(0.2)

0.2

–

26.9

20.5

(0.2)

0.2

–

20.5

31 Dec 21

31 Dec 20

31 Dec 19

1,001.6

140.7

916.0

137.8

858.6

136.2

The Investment Basis NAV increased by 9.4 per cent. to £1,001.6 million at 31 December 2021 (31 December 2020: £916.0 million). This equates to
a growth in Investment Basis NAV per share of 2.1 per cent. to 140.7p at 31 December 2021 (31 December 2020: 137.8p). The Investment Basis NAV
per share is the Investment Basis NAV divided by the number of Company shares issued and outstanding. This information presents the residual
claim of each shareholder on the net assets of the Group.

BBGI Global Infrastructure S.A. | Annual Report 2021

Alternative Performance Measures (‘APM’)

APM is understood as a financial measure of historical or future financial performance, financial position, or cash flows, other than a financial measure
defined or specified under IFRS. The Group reports a selection of APM as summarised in the below table and as used throughout this Annual Report.
The Management Board believe that these measures provide additional information that is useful to the users of this Annual Report.

The APM presented here should supplement the information presented in the Financial Statement section of this Annual Report. The APM used
are not measures of performance or liquidity under IFRS and should not be considered in isolation or as a substitute for measures of profit, or as an
indicator of the Group’s operating performance or cash flows from operating activities, as determined in accordance with IFRS.

APM

Explanation

Annualised Total
Shareholder Return
Since IPO (‘Annualised
TSR’)

Presented on a compounded annual growth rate basis. This represents
the steady state annual growth rate based on share price as at 31
December 2021, and after adding back dividends paid or declared since
IPO. Investment performance can be assessed by comparing this figure
to the 7% to 8% TSR target set at IPO.

Asset Availability

Cash dividend cover
ratio

Calculated as a percentage of actual availability payments received, as a
percentage of scheduled availability fee payments. The Company targets
a rate in excess of 98%. A high asset availability rate can be viewed as a
proxy to strong underlying asset performance.

The cash dividend cover ratio is a multiple that divides the total net cash
generated in the period (available for distribution to investors) by the total
cash dividends paid in the period based on the cash flow from operating
activities under IFRS.A high cash dividend cover ratio reduces the risk
that the Group will not be able to continue making fully covered dividend
payments.

Investment Basis NAV Investment Basis NAV is a non-GAAP measure and is adopted by the
Group to reflect a more accurate economic value of the shareholder
interest, based on the fair value of the underlying assets and liabilities
at the balance sheet date. The Investment Basis NAV represents the
residual interest of the shareholders in the Group, after all the liabilities of
the Group, if any, have been settled.

Total accounting return
per share

The sum of the change in NAV per share plus the dividends paid per share
in the year, taken as a percentage of the NAV per share at 31 December
2020. Indicates the movement in the value of the consolidated Group in
the reporting period.

31 December
2021

10.4%

31 December
2020

11.0%

99.9%

99.8%

1.31x

1.27x

£1,001.6 million

£916.0 million

7.4%

6.38%

Net cash (debt)

Ongoing charges

This amount is used to depict the solvency of the Group before
considering the committed amount available under the RCF.

£26.9 million

£20.5 million

Represents the annualised reduction or drag on shareholder returns
as a result of recurring operational expenses incurred in managing the
Group’s consolidated entities, and provides an indication of the level of
recurring costs likely to be incurred in managing the Group in the future.

0.86%

Refinancing risk ratio

Used to represent the percentage of the portfolio by value that has an
exposure to refinancing of senior debt financing.

Target dividend

Total Shareholder
Return since IPO
(‘TSR’)

Weighted average
portfolio life

Represents the forward-looking target dividend per share. These are targets
only and are not a profit forecast. There can be no assurance that these
targets will be met or that the Company will make any distribution at all.

7.48 for 2022
7.63 for 2023 and
7.78 for 2024

7.33 actual dividend
declared for 2021

The TSR combines share price appreciation and dividends paid since
IPO in December 2011 to represent the total return to the shareholder
expressed as a percentage. This is based on share price at 31 December
2021 and after adding back dividends paid or declared since IPO.

Represents the weighted average, by value, of the remaining individual
project concession lengths. Calculated by reference to the existing
portfolio at 31 December 2021, assuming no future portfolio additions.

171%

157.5%

20.3

20.4

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTESG (Environment, Social and Governance)

Sustainability highlights
Our purpose is to provide access to a diversified portfolio of essential social infrastructure investments that generate long-term, sustainable returns
and serve an inherent social purpose.

In alignment with our SFDR Article 8 product classification, we have a focused approach, investing in core social infrastructure assets which serve society.

Our portfolio includes investments in healthcare (hospitals and clinics), education (schools), affordable housing, blue light (fire stations and police
stations), modern correctional facilities and transport (roads and bridges).

BBGI is a long-term custodian of these assets and we partner with the public sector to provide well maintained infrastructures. In return BBGI
receives an availability-based revenue stream that is paid by our public sector (backed) clients.

Sustainability achievements

Task Force on Climate-Related
Financial Disclosure

recommendations

• TCFD supporter since 2020

• Voluntary disclosures aligned with Task Force on Climate-Related Financial Disclosures (‘TCFD’)

Carbon
Neutral
Organisation

• Detailed climate risk assessment of our portfolio undertaken; modelling considered physical risk

from 8 different perils, under three different climate scenarios over multiple time horizons

• Portfolio demonstrates a high degree of climate resilience

• All Scope 1, 2 and 3 corporate emissions reported and results have been independently verified

• Certified as carbon neutral for 2021

• Started to track Scope 1 and 2 emissions at our portfolio companies and will report from 2022

onwards

• Compliant with the Sustainable Finance Disclosure Regulation (‘SFDR’) since March 2021

• Article 8 product classification and meet the criteria for socially beneficial investments

• Enhanced disclosure in line with SFDR requirements and we will actively report against the new

standards as they emerge

• Comprehensive stakeholder materiality assessment undertaken involving employees,

shareholders, clients, and subcontractors

• Identified ten material topics influencing our ESG strategy

• Introduced KPIs to track material topics and to ensure incremental progress in our delivery of

positive stakeholder outcomes

• Introduction of enhanced ESG Best Practice Guide at all of our Portfolio Companies

• 80+ question screening tool covering all aspects of our ESG oversight

• Supports the implementation of BBGI’s Sustainability strategy and SFDR disclosure obligations

• BBGI became a signatory to the Net Zero Asset Managers initiative in 2021

• Committed to supporting the goal of net zero greenhouse gas emissions by 2050

• Set net zero targets for our Corporate and Financed emissions

• Obtained a Sustainalytics ESG Risk Rating of Negligible Risk

WE SUPPORT

• Signatory of UN Principles of Responsible Investments since 2019; rated A

• Signatory of UN Global Compact since 2020

• 59% of our assets have a sustainability certification

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Looking back on our achievements
2021 has been an important year in accelerating our ESG efforts and we are pleased to report our progress. We transformed aspirations into
tangible programmes and have set a solid foundation to reach our 2050 goals and ambitions.

Environment and climate
change 2021 objectives:

Social 2021 objectives:

Governance 2021 objectives:

Measure and disclose
the carbon footprint
from our corporate
activities

Measure and disclose
the carbon footprint
from our investment
portfolio

Setting a GHG
reduction target in
line with the Paris
Agreement

Voluntary compliance
with the TCFD
requirements in
our 2021 disclosures

Reducing our
business travel
and continue to use
video conferencing
solutions

Perform a robust
materiality
assessment based on
stakeholder
engagement

Improve our reporting
on both positive and
negative impacts

Develop our approach
to measuring the
social value provided
by our investments

ESG training for our
staff

Consider gender and
ethnic diversity
within our team

Expand our ESG data collection
process amongst our portfolio
companies, including SFDR
Principal Adverse Sustainability
Impacts indicators

Engage our portfolio
companies
to reduce their GHG
emissions

Engage our portfolio
companies to set a GHG
reduction target in line with
the Paris Agreement

Screen all our
investments against
our climate change
questionnaire

Perform a full assessment
of our portfolio to
understand our risk and
exposure in relation to
climate change

Completed

Ongoing

Started

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTESG (Environment, Social and Governance) continued

Approach to responsible investment
Our investment strategy embodies the Company’s purpose to help provide the responsible capital required to build and maintain the developed
world’s social infrastructure, reflecting our SFDR classification as an Article 8 product, where we promote social characteristics in combination with
good governance practices.

ESG is an integrated part of our investment process
BBGI has implemented a robust framework for ESG integration into all aspects of the investment cycle, from initial screening through to end of
investment life:

End of investment life

• Hold investment for duration or realise

value through exit

• Share ESG information acquired during
our concession period with our public
sector clients

• Responsible and collaborative approach

to asset hand back to public sector

Reporting

• Communicate results to stakeholders

• Annual reporting of UN PRI, UN Global
Compact, SFDR and TCFD on ESG
activities

• Continuous improvement of process

and reporting

Monitoring

• Semi-annual proprietary ESG KPI survey

for each investment

• Active ESG management at portfolio

company level through engaged board
representation

• Regular health and safety, fire audits,
cyber reviews and other monitoring

• Monitor climate risk mitigation

performance and improve data collection
processes over time.

• Discussed ESG at Management Board

meetings, as well as at individual portfolio
company board meetings

• Semi-annual reporting of ESG initiatives

• Identify areas of improvement

Sourcing

End of
investment
life

Due
diligence

Reporting

Stewardship

Monitoring

Sourcing

• Screening to determine compatibility with

BBGI’s ESG policy

• Public data searched to identify ESG

issues

• Pre-defined exclusions list: adult

entertainment, alcohol production,
arms production, arms trade, fossil fuels,
gaseous fuels, coal, gambling, nuclear
energy, nuclear weapons and tobacco
production

Due diligence

• Detailed proprietary ESG KPI survey
covering SFDR Principal Adverse
Sustainability Impacts indicators25

• Assess climate risk against a ‘Paris-
Aligned’ RCP26 2.6 scenario (~+1°C
warming) and a ‘High emissions’ RCP8.5
scenario (~+3.7°C warming) across three
time periods (2020, 2050 and 2100)

• Seek, when necessary, appropriate
environmental and technical due
diligence carried out by independent
third-party experts

• Anti-money laundering screening and
counter terrorism financing database
checks

• ESG assessment completed as part of

Investment Committee papers

Stewardship

• Implement ESG policy at portfolio

company level

• Review and monitor assets for ESG-
related issues and performance

• Work with stakeholders to implement
strategic and operational objectives

• Review our staff’s achievement of ESG

targets and executive compensation tied
to ESG targets

• Seek to share ESG best practices inside

and outside of the Company and engage
with stakeholders

• Invest to improve energy efficiency and

reduce GHG emissions/carbon footprint
where appropriate

25 The EU Sustainable Finance Disclosure Regulation (SFDR) is a new set of European Union rules that came into effect on 10 March 2021, providing a set of pre-defined

metrics for assessing the ESG impacts of the investment process, referred to as Principal Adverse Sustainability Impact indicators.
26 RCP: Representative Concentration Pathway. More details on climate scenario analysis can be found in the section ‘TCFD Disclosures’.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Contribution to Sustainable Development Goals
The Sustainable Development Goals (‘SDGs’) are a fundamental tenet to BBGI’s ESG
framework and are used to assess, measure and monitor the environmental, social and
sustainable attributes of investments either already held as part of the Company’s existing
portfolio, or those being assessed as potential investment opportunities.

As part of our vision to fulfil our social purpose and show leadership in responsible
infrastructure investment, alignment with the SDGs is an integral part of our approach to ESG.
In the past we were focused on five SDGs, but have now expanded our focus to also include
SDG 13, given the importance of addressing climate change. We acknowledge that through
our direct operations and investment portfolio we can also create negative impacts and we
address these impacts in the relevant sections of this Report.

Through our direct operations, BBGI can generate profits, employment and provide access
to essential services in countries where we have investments. Through partnerships with
government and the public sector, we can ensure that the benefits of the social infrastructure
assets we finance extend beyond our investment, so that the funded project has an overall
positive impact and serves an inherent social purpose in their local communities.

BBGI is committed to invest responsibly, with the target to promote the improved
education and well-being of local communities, help reduce transit times and congestion,
build and upgrade infrastructures while also striving to preserve biodiversity and natural
habitats, operate assets with less waste, monitor the safety of users, incorporate new
sustainable technologies, curb emissions and improve environmental stewardship.

Sustainable Development Goals

Portfolio impacts

Target 3
Good health and
well-being

–

41 essential healthcare facilities

– Over 2,400 beds

– More than 4.4 million patients treated in the last year

Our core
SDG

Portfolio SDG
contribution27

22%

Our core
SDG

Target 4
Quality education

Target 9
Industry, innovation
and infrastructure

Target 11
Sustainable cities
and communities

Target 13
Climate action

Target 16
Peace, justice and
strong institutions

–

33 schools and colleges

– Providing an effective learning environment for over

39,000 students

–

Total serviced area of more than 400,000m2

Portfolio of social infrastructure investments helping to
build resilient infrastructure, promoting inclusive and
sustainable industrialisation, and fostering innovation

100%

–

3 affordable residential housing and 2 community
centres

– Providing 100 residential housing units, sport and

leisure centres for the local community

–

18 transportation investments globally including
1 fully electric public transit system investment
powered by green energy

–
Safe, accessible and sustainable transport systems for all
– Reduce travel times for over 300 million vehicles each year

56%

–

In 2021, BBG has set net zero targets in line with Net
Zero Asset Manager Initiative using science-based
targets, with the aim of enhancing asset-level resiliency
to climate change

100%

–

4 police stations keeping a community of over 1.6
million people safe

–

4 modern correctional facilities

12%

27 Based on portfolio value as at 31 December 2021.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT349111613100%100%56%22%9%12%ESG (Environment, Social and Governance) continued

Stakeholder engagement
We are stewards of important social infrastructure investments and there are many stakeholders who are impacted by our actions: users of the
infrastructure, communities, employees, investors, partners, the environment, and society at large. We take this responsibility seriously.

The fundamental rationale for integrating and embedding ESG factors into our business model is to ensure our actions generate positive and
sustainable outcomes for our stakeholders for the long term, and that we manage and reduce adverse impacts. BBGI has consistently engaged
with our stakeholders through a variety of channels over the years. Our ESG Report summarises BBGI’s general engagement approach with its key
stakeholders, representing the main groups that benefit, are influenced by or interact with our business activities.

While, as a Luxembourg-based company, BBGI is not obliged to comply with the UK Companies Act 2006, we are voluntarily complying with
the spirit of the Section 172 requirement by including details describing how the decision-making of our Directors considers the interest of
our stakeholders. This section serves as our Section 172 Statement. Section 172 of the UK Companies Act 2006 requires Directors to take into
consideration the interests of stakeholders in their decision-making.

Materiality assessment
In 2021, we undertook a comprehensive Materiality Assessment exercise and recorded the results in a robust materiality matrix, summarising our
ten most material sustainability topics and strategic ESG areas of focus. A broad and diverse group of stakeholders contributed to this exercise,
representing the ecosystem of our operations in our various operating countries: employees, investors, clients, partners and subcontractors. These
ten topics have informed key ESG commitments, KPIs for which we are now tracking to ensure incremental progress in our delivery of positive
stakeholder outcomes. We would like to thank all respondents for sharing constructive feedback, which complemented and shaped our thinking
on current and emerging issues and the future of our social and environmental commitments.

Of the ten topics which were deemed most material, three are related to the environment
and climate, three to social matters and four to governance:

Environment and
climate change

Social

Governance

Climate change and ESG factors as
strategic risk/opportunities

Health and Safety of staff and workers at
our portfolio companies

Creating long-term financial and
sustainable value

Reducing BBGI’s own carbon footprint

Fair employment and remuneration

Quality of services provided

Reducing the carbon footprint of our
portfolio companies

Learning and development

Business ethics and integrity

Cyber security

Net-zero commitment
We will support our portfolio transition to net zero emissions by 2050
As part of our commitment to reducing energy use and carbon dioxide emissions, BBGI became a signatory to the Net Zero Asset Managers
Initiative and commits to support the goal of net zero greenhouse gas (‘GHG’) emissions by 2050, in line with global efforts, to limit warming to
1.5°C (‘net zero emissions by 2050 or sooner’). We also commit to supporting investing aligned with net zero emissions by 2050 or sooner.

The Net Zero Asset Managers initiative
The Net Zero Asset Managers initiative (NZAM) is a group of international asset managers committed to supporting the goal of net zero
greenhouse gas emissions by 2050 or sooner, in line with global efforts to limit warming to 1.5°C; and to supporting investing aligned with net zero
emissions by 2050 or sooner.

It is an initiative designed to mobilise action by the asset management industry that demonstrates leading practice in driving the transition to net
zero and delivers the ambitious action and investment strategies that will be necessary to achieve the goal of net zero emissions. It also provides a
forum to share best practice and overcome barriers to aligning investments to that net zero goal.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Our targets
BBGI’s commitment to net zero can be distilled into the following targets:28

Corporate
targets

Portfolio
targets

BBGI Corporate Emissions29
Scope 1, Scope 2 and
Scope 3:
• Reduce our Corporate Emissions
Scope 1, 2 and 3 by 50% by 2030.

• Carbon neutral from 2021 onwards. All
residual and unavoidable Corporate
Emissions will be offset by purchasing
high quality offsets to obtain carbon
neutrality beginning in 2021.

• Net zero Corporate Emissions Scope 1

and Scope 2 by 2040

BBGI’s Financed Emissions30
• Report Financed Emissions (Scope 1 and 2 at portfolio companies) for 100% of

portfolio companies beginning from 2022 onwards.

• Provide resources for public sector clients (asset owners) by sharing emissions data

and general strategies for reduction.

• Engage with our top 20% of emitters to discuss emission reduction strategies by 2024.
• Develop net zero plans for 50% of portfolio companies by 2025.
• Develop net zero plans for 100% of portfolio companies by 2030.
• Reduce our Financed Emissions (portfolio companies Scope 1 and 2 emissions and,
to the extent possible, material portfolio companies Scope 3 emissions) by 50% by
2030. We will need the support of our public clients to achieve tangible results in
respect of this ambitious target.

• Overall net zero Financed Emissions by 2050 or sooner.

We commit to reporting our progress against these targets on an annual basis.

Emissions boundaries
BBGI has adopted the operational control boundary approach in accordance with the Greenhouse Gas Protocol Corporate Standard (‘GHG
Protocol’) for the measurement of emissions, as the Management Board believes this reflects the level of emissions that can be actively controlled and
reduced. A company has operational control over a portfolio company if it has the full authority to introduce and implement its operating policies at the
portfolio company level. BBGI rarely has operational control at its portfolio companies, so the achievement of the targets and objectives will be highly
dependent on successfully influencing stakeholders (typically our public sector clients) into taking action to achieve these goals.

Methodology of BBGI’s Net Zero Plan
BBGI’s GHG emissions reduction targets have been set in line with science-based targets that are consistent with achieving net zero global
emissions by 2050, or sooner. We developed a Net Zero Plan, which details the targets, metrics and pathways of GHG emissions reduction that
pertain to our Corporate Emissions and our Financed Emissions. We used the Science-Based Targets initiative (SBTi) target-setting to model
targets in line with SBTi approved criteria and methods. BBGI’s GHG reduction percentage according to a 1.5°C scenario is as follows:

Baseline

Corporate Emissions in metric tons CO2e

Scope 1

Scope 2

Scope 3

Total

2019 Baseline

2021 Current
Due to COVID-19 restrictions we consider 2020 and 2021
outliers, especially for business travel.

2030 Forecast

256

273

2.5

128

136

% reduction in
metric tons CO2e

-72%
(vs. baseline year 2019)

-4%
(vs. previous year)

-50%
(vs. baseline year 2019)

Definitions:
Scope 1 – Energy consumption from gas use in corporate offices

Scope 2 (market-based) – Energy consumption from purchased electricity use in corporate offices

Scope 3 – Business travel from air travel, upstream well-to-tank emissions, personal vehicles for business purposes and taxi travels, employee commuting, home-working
emissions, electricity transmission & distribution, water supply and treatment, waste, emissions stemming from cloud-based storage

Science-based targets – Targets adopted by companies to reduce GHG emissions are considered ‘science-based’ if they follow a pathway that is consistent with the latest
climate science and keeping warming to 1.5°C. Science-based targets show how much and how quickly companies need to reduce their GHG emissions to prevent the worst
effects of climate change

28 Baseline year: 31 December 2019; Methodology: Net Zero Asset Managers Initiative using Paris Aligned Investment Initiative Framework and Science-Based Targets

initiative (‘SBTi’) target setting tool and guidance for Private Equity and SMEs.

29 GHG emissions that pertain to our business activities.
30 GHG emissions of our portfolio companies.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTESG (Environment, Social and Governance) continued

Task Force on Climate-Related Financial Disclosure
In our 2020 Annual Report, we made our first voluntary disclosure against the Financial Stability Board’s Task Force on Climate-Related Financial
Disclosure (‘TCFD’) recommendations, where we set ambitious targets to screen all our investments for climate risk and better quantify our GHG
emissions. During the same year we also demonstrated our ambition by becoming a ‘TCFD Supporter’.

We are pleased to present our second disclosure against the TCFD recommendation in which we report against all 11 of the recommended TCFD
disclosures, again on a voluntary basis.

We continue to align our business with the TCFD recommendations and, during the past year, we made progress on a number of initiatives related
to climate strategy, risk management and metrics and targets, including:

– Developing a climate-risk methodology and framework to identify, assess, monitor and report on physical and transition risks associated with

climate change.

–

Enhancing our internal ESG Due Diligence to formally identify and evaluate material climate risks and opportunities.

– Completing a GHG inventory for BBGI’s Corporate Emissions and commenced the process at our portfolio companies consistent with the

GHG Protocol.

– Making a commitment to investing aligned with net zero emissions by 2050 or sooner and the implementation of science-based targets and
standardised methodologies through which to deliver these commitments. This included joining the NZAM Initiative and committing to work
in partnership with our public sector clients on decarbonisation goals.

–

Expanding the use of metrics and targets, including those related to GHG emissions.

Key Findings

Modelled assets

Resilient portfolio

assets have been modelled
based on ‘Paris-Aligned32’,
and ‘High emissions33’ scenarios
across three time periods
(2020, 2050 and 210034)

assets have the same
risk score today and in
2050 under a ’High
emissions’ scenario

Assessing Climate Risk
BBGI began to incorporate climate-related risk into our risk management
framework in 2020 and in the same year we began screening all
new investments, using a proprietary climate-resilient infrastructure
questionnaire. This proprietary 40 question screening tool was based on
the OECD 2018 Report on Climate Resilient Infrastructure and the World
Bank Climate and Disaster Risk Screening policies. We later undertook a
review of all our existing assets using this same tool to better understand
the effects that climate change could have on our business.

As part of our evolving sustainability journey and our commitment to
continuous improvement, in 2021 we engaged a climate-modelling
specialist firm to undertake a detailed review of all our infrastructure
investments, to consider how both physical and transition risks could
impact our investments due to climate change.

Risk score today

Risk score in 2050

– Physical risks: extreme weather events and gradual changes in climate

assets have a medium
or lower risk score today

assets have a medium or lower
risk score in 2050 under a
’High emissions’ scenario

Low or very low
exposure

Risk score under a 'High
emissions' scenario

out of our Top 20 assets have
a low or very low exposure in
2050 under ’Paris-Aligned’
and ‘High emissions’ scenarios

assets have a high risk
in 2050 under 'High emissions'
scenario

–

Transition risks: policy, legal, technology, consumer preferences and
reputation

Physical risks considered consisted of eight different acute and chronic
climate perils, including: river flood, surface water/pluvial flood, coastal
inundation including sea-level rise, windstorm/hurricane, forest fire,
subsidence/soil movement, heat stress/extreme heat/drought and freeze-
thaw. Two different potential climate scenarios were considered: ‘Paris
Aligned’ scenario with a warming of ~+1.0°C by 2100 (RCP2.6) and a ‘High
emissions’ scenario with a warming of ~+3.7°C by 2100 (RCP8.5)31. These
different climate perils were modelled across three time periods (2020,
2050 and 2100) for each of the climate scenarios.

In addition to the above noted analysis, we are currently undertaking
an enhanced ‘deep-dive’ assessment on twenty of our assets to better
understand climate risks across our portfolio.

Transition risks considered included policy risks, legal risks, technology
risks, reputational risks and change in market preferences. Transition risks
and opportunities are also being considered and discussed.

31 RCP: Representative Concentration Pathway. Climate scenarios based on 1986-2005 reference period. Data based on published scenarios from the Intergovernmental

Panel for Climate Change (‘IPCC’). Source: IPCC, 2014: Climate Change 2014. Synthesis Report. Available at: www.ipcc.ch/report/ar5/syr/
‘Paris-Aligned scenario (RCP2.6) as rapid global action occurs to limit mean temperature increase to ~+1°C.
‘High emissions’ scenario (RCP8.5) as emissions continue to rise with likely mean temperature increase of ~+3.7°C.

32
33
34 Our modelling quantifies physical impact severities for 2020, 2050 and 2100 under each climate scenario. However, our concession term does not extend further than 2051

for any asset. As a result, subsequent results in this Report are being reported up to 2050.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Physical Risk Insights
Overall, scenario analysis has highlighted the majority of the BBGI portfolio is very resilient to climate hazards both today and under future climate
warming scenarios.

– Out of 54 assets modelled, only three have a high risk under a ’High emissions’ scenario by 2050. Under a ‘Paris-Aligned’ scenario, only one

asset has a high risk across the same timescale.

– Of the three assets with a high risk under a ’High emissions’ scenario, we note that our concession period on the three assets terminates

between 2030 and 2040, and thus we do not expect them to have material impact on our wider portfolio.

– Where there is risk within our portfolio, the driving peril is flood. Physical impacts are principally caused by river or coastal flooding; however,

surface water flooding is increasingly prominent under future climate change scenarios.

–

17 of BBGI’s top 20 assets all have a low or very low risk exposure today, and in 2050 under ’Paris-Aligned’ and ‘High emissions’ scenario.

The risk profile of BBGI’s portfolio remains constant for 50 assets over the next 30 years, the climate risk profile of BBGI’s portfolio remains relatively
constant for the majority of assets, particularly when overlaying our concession periods, which do not extend further than 2051 for any asset.

– We note that modelling currently only considers present-day government-funded defence infrastructure in place. When local mitigation

measures are also taken into account, this may further reduce the exposure of our assets to climate change.

Transition Risk Insights
We recognise the effects transition risks have on our business. In the table below, we outline the potential impacts of policy, technology,
reputational and market risks across the infrastructure sector.

Transition Risk Category

Industry Trends

Mitigating Actions

Policy and legal risk:

Legislation enacted by national and local
governments to price and penalise GHG
emissions

Technology risk:

Disruptive technology changes in key sectors of
the economy responding to changing energy
needs

We anticipate that as society attempts to
reduce global warming, the cost of carbon
taxation will increase and potentially impact
businesses. Carbon pricing and exposure
to litigation may also increase globally,
encouraging businesses to reduce their own
GHG emissions.

Technology risks may arise across infrastructure
assets where changes and adaptations to new,
low-carbon materials and technologies arise.

Reputational risk:

Investor and client sentiment influenced by the
Company’s actions to manage climate change
risk

Globally there is increasing focus on businesses
to minimise their carbon footprint. Reputational
risk may arise where companies do not take
sufficient action to decarbonise or integrate
sustainability across their operations.

Market risk

Market disruption, changes in client
preferences, cost of capital and valuation
changes, as investors prioritise returns from low
carbon companies

Transitioning into a low carbon society has
potential implications on client and investor
appetite and demand.

We are exploring ways to further minimise
our carbon footprint in line with our net-zero
commitment. We recognise decarbonisation as
a priority and a key focus area for BBGI.

We are exploring ways to implement the use
of increasingly environmentally-friendly and
sustainable materials across our assets such
as low carbon alternatives for road surfaces,
electric vehicles charging infrastructures and
switching to energy-efficient or motion sensor
equipment during planned refurbishments. We
will continue to investigate new technologies
which can improve the environmental efficiency
of our assets in the long term.

We recognise the need to decarbonise our
portfolio companies and are developing a
number of strategies to begin reducing our
emissions footprint. We continue to work with
our public sector clients and subcontractors
to communicate our decarbonisation plans,
propose carbon footprint and net-zero
assessments and ensure we continue to align
with regulatory requirements for reporting on
and managing our ESG and climate risks.

We are making voluntary TCFD Disclosures
to satisfy investor priorities and monitor ESG
and sustainability regulations and reporting
requirements, to maintain our compliance.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTESG (Environment, Social and Governance) continued

As the Company is considered an investment trust it is therefore not in scope of the Financial Conduct Authority’s (FCA) requirement for
commercial companies with a premium listing to make TCFD disclosures. Notwithstanding this exemption, the Management Board recognise
the importance of the TCFD and its related disclosures and has, as a result, taken the voluntary decision to fully report against the TCFD
recommendations.

On the following pages we report the progress we have made across each of TCFD’s four pillars: Governance; Strategy; Risk Management; and
Metrics and Targets. We have made material improvements toward assessing our climate-related risks and opportunities, embedding stronger
climate governance and risk management across the business and developing a robust awareness of risk metrics and targets we can use to monitor
and track progress.

We are pleased to present our second disclosure against all 11 of the recommended TCFD disclosures:

Governance

TCFD Recommendation

Progress to date

1 Describe the Board’s
oversight of climate-
related risks and
opportunities.

– Our Supervisory Board and Management Board recognise the importance of climate-related risk and
opportunities and the Management Board has established an executive-led ESG Committee as a sub-
committee, comprising of the Co-CEOs, the CFO, the ESG/Sustainability Director and the Corporate Secretary
to govern all climate and ESG-related activities.

–

This ESG Committee meets at least quarterly, and in relation to environmental matters reviews both the
climate-related risks facing the Company and its GHG emissions reductions targets. The Risk Manager and the
Management Board ensure that any risks/opportunities can be addressed through the Company strategy, risk
management procedure and responsible investment approach.

The Management Board considers climate-related issues when setting strategy, approving annual budgets,
monitoring performance metrics and targets, approving climate change-related disclosures and overseeing
potential portfolio acquisitions.

The Supervisory Board’s constituted Remuneration Committee designs reward structures for our Management
Board executives in ways that foster long-term value-creation and reinforce the organisation’s ability to achieve
its climate change goals and targets. In 2021, the Remuneration Committee introduced LTIP targets related to
reducing GHG emissions.

More details on our remuneration policy are provided in the Remuneration Report section of this Annual
Report.

2 Describe

–

management’s role
in assessing and
managing climate-
related risks and
opportunities.

The ESG Committee meets at least quarterly, in relation to environmental matters and reviews both the
climate-related risks facing the Company and its GHG emissions reductions targets. The Risk Manager and the
Management Board ensure that any risks/opportunities can be addressed through the Company strategy, risk
management procedure and responsible investment approach.

– Our ESG Committee is led by our dedicated ESG Director, and together with the Management Board, maintains

our ongoing commitment to manage the dual impacts of both physical risk events on our assets and the
transition towards becoming a low carbon business and delivers our sustainability programmes.

– Management Board’s roles cover the following areas:

– The Investment decisions incorporate ESG and climate-related risks and opportunities assessments during
the due diligence phase for new acquisitions. All existing and all new investment opportunities are screened
for climate risks and ESG factors.

– The Risk Management Function assesses the firm’s exposures across all risks compared with its stated risk
appetite, including the long-term consequences of climate change along our asset’s concession periods.

– Corporate governance obligations and oversight responsibilities in relation to climate-related risks and the

review of the Company’s approach to disclosures, including those relating to climate change.

– The Compliance Function undertakes an internal compliance monitoring programme, including our policies

relating to sustainability including climate change.

Full responsibilities of our ESG Committee are outlined in our ESG Committee Terms of Reference which can
be viewed on the Company’s website www.bb-gi.com/esg/.

–

In 2021, BBGI commissioned an independent carbon footprint assessment and verification of its Scope 1-2
and 3 GHG emissions, as well as a detailed climate change impact assessment for its entire portfolio, to identify
and assess climate-related risks and opportunities across various climate scenarios. The results of this in-depth
exercise will inform our long-term strategy and sets the foundation for further embedding climate-related risks
into our engagement approach and investment decision process.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Strategy

TCFD Recommendation

Progress to date

3 Describe the

–

climate-related risks
and opportunities
the organisation has
identified over the
short, medium and
long term.

In 2021, we have chosen to focus on undertaking an extensive, more detailed quantitative assessment of physical
risk exposure across our entire asset portfolio to better identify climate-related risks that could have a material
financial impact on the business, supporting wider management-led decision making.

– Our assessment considers climate impacts over short (1-5 years), medium (5-10 years) and long-term (10+ years)

time horizons up until 2050, covering the maximum investment life duration of our current portfolio.

–

Findings from our climate analysis demonstrate a high degree of climate resilience across our asset portfolio
both today and under different climate warming scenarios.

– Due to our asset’s geographical locations, flood-related perils rank amongst the most material physical risks,

particularly under a ‘High emissions’ scenario, although overall exposure may be mitigated through both national
and local defence mechanisms and a comprehensive insurance programme.

– Beyond 2051, the period when our concessions end and assets revert to public sector clients, climate risk is

projected to increase for 17 assets, most notably under a ‘High emissions’ scenario. While BBGI will not have a
financial interest in the assets during this future period, it may create opportunities for BBGI to propose climate
mitigation and adaptation measures.

– Under a ‘Paris-Aligned’ scenario it is likely that BBGI can take advantage of opportunities arising from energy
transition investment plans from the public sector during planned retrofit interventions or for additional
investments.

– BBGI are working to understand the impact transition risks will have on the portfolio, particularly where rapid,

unexpected changes in legislation or government policy occur.

4 Describe the

– During 2021, we engaged with a climate-modelling specialist firm, leveraging their expertise in climate risk, to

impact of climate-
related risks and
opportunities on
the organisation’s
businesses, strategy,
and financial
planning.

better quantify both the materiality and financial impact of physical risks on our entire asset portfolio.

– We are committed to ensuring our investment strategy, financial planning and decision-making accounts for

climate-related risks and opportunities, ensuring we work with our clients to consider appropriate risk mitigation,
adaptation and resilience measures where necessary.

–

The results of the quantitative climate change assessment will feed into our Company’s strategy in a number of
ways. It informs us on the type of climate risk each of our assets is exposed to, the magnitude of that risk (from low
risk to high risk, if any) and the corresponding reinstatement value (i.e. the potential cost of damage from physical
climate risks). This exercise will be complemented during the first part of 2022 by a ‘deep-dive’ assessment for
20 of our assets. The outcomes will drive our engagement initiatives as we will share the findings with our public
sector clients.

The primary financial impacts of physical climate risks for BBGI were modelled in relation to our portfolio
companies until the end of the concession term: our costs model might increase to accommodate increased
insurance premiums; however, there is a degree of contractual protection from increased insurance costs.

– Our Net Zero Plan lays the foundation of how BBGI intends to transition to a low carbon business as we leverage
the outcomes of the quantitative climate-change assessment in order to set our targets and objectives, as well as
inform future acquisition screening and strategic portfolio construction.

5 Describe the

– Portfolio-level findings from the quantitative climate change assessment highlight a high-degree of resilience to

resilience of the
organisation’s
strategy, taking
into consideration
different climate-
related scenarios,
including a 2°C or
lower scenario.

climate change impacts under scenarios tested.

– As exposures are identified from the analysis, we are considering how outputs can inform future decision making.

– We have identified one asset with a high risk by 2050 under the ‘Paris-Aligned’ scenario and three assets under

the ‘High emissions’ scenario.

– Any assets we have identified as medium or high risk or considered important to BBGI, are being taken forward

to a ‘deep-dive’ assessment to better identify local resilience and mitigation measures that may further minimise
residual climate risk.

– A transition to a lower carbon economy also presents a number of opportunities.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORT
ESG (Environment, Social and Governance) continued

Risk Management

TCFD Recommendation

Progress to date

6 Describe the
organisation’s
processes for
identifying and
assessing climate-
related risks.

7 Describe the
organisation’s
processes for
managing climate-
related risks.

8 Describe how
processes for
identifying,
assessing, and
managing climate-
related risks are
integrated into
the organisation’s
overall risk
management.

– Prior to acquiring any new asset, we systematically consider during the due diligence phase whether – and to

what extent – material sustainability risks might meaningfully impact our investments, including climate-related
risks. When an investment is made, we ensure the ongoing monitoring and management of sustainability risks.
We may use inputs from external data providers but typically base our due diligence process on proprietary
models and primary data we obtain from our portfolio companies.

–

The Company’s approach to internal controls is risk based. All material risks are identified, analysed, assessed,
reported and managed. Sustainability risk, including climate-related risk, is part of what we consider being one
of our strategic risks. Since outlining our commitment to better improve our understanding of climate-related
risks and opportunities, in 2021 we have chosen to focus on two areas: 1) identifying physical risk exposures to
our asset portfolio, and 2) better quantifying our corporate GHG emissions footprint to support identification of
future risks arising as we develop our decarbonisation strategy.

–

To ensure our portfolio remains resilient to climate risk, we will embed these new insights into our investment
screening process from 2022 which ensures physical climate risk impacts are assessed for all new investments.

– Climate risks identified through our climate risk modelling are managed by our Risk Manager and the

Management Board with work continuing to ensure climate risk considerations are formally embedded within
risk management procedures.

– Recognising that climate risk cross-cuts both our value-driven asset management approach and the essential
infrastructure we provide to our clients, work is ongoing to ensure climate risks, where identified, will be actively
discussed with public sector clients with the objective of a collective action through influence and stewardship
where necessary (e.g. mitigation, risk transfer). It should be noted that BBGI rarely has operational control at its
portfolio companies, so the achievement of the targets and objectives will be highly dependent on successfully
influencing stakeholders (typically our public sector clients) into taking action.

–

Through 2021, we have systematically reviewed all existing investments for physical climate change exposure
against eight climate perils through quantitative scenario-analysis. This exercise will be complemented during
the first part of 2022 by a ‘deep-dive‘ assessment for 20 of our assets considering at this point the mitigation
measures in place for each asset.

– Our engagement activities are undertaken by our asset managers in close collaboration with our public sector
clients and local contractors. Informed by the result of both our internal ESG KPI survey and the results of our
climate change assessment, over time, each portfolio company will systematically develop and share an action
plan with our public sector clients to suggest adaptation and mitigation measures they may want to consider.
The ESG Committee will receive regular progress updates from the various portfolio companies and, through its
reporting, will facilitate direct oversight at Management Board level.

– By voluntarily applying the TCFD regulatory framework, BBGI is gradually reinforcing numerous aspects of
sustainability as a strategic agenda item: risk and opportunities identification, management of climate-risk
exposure and disclosure of relevant metrics and targets.

– BBGI is required to comply with the EU Sustainable Finance Disclosures Regulation (‘SFDR’).

–

Through 2020 and 2021, we have made systematic enhancements to our risk management procedures to
integrate climate-related risk.

– Where material climate risks are identified, these are escalated where necessary to the ESG Committee and
the Management Board at least quarterly, ensuring risks can then be appropriately assessed, managed and
monitored per our risk management procedure.

–

To ensure our portfolio remains resilient to climate risk, we will embed our findings into our investment screening
process which ensures physical climate risk impacts are assessed for all new investments.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Metrics and Targets

TCFD Recommendation

Progress to date

9 Disclose the

–

metrics used by
the organisation
to assess climate-
related risks and
opportunities in line
with its strategy and
risk management
process.

Through scenario analysis conducted through 2021, we are now embedding enhanced physical risk metrics
across our risk management processes and will embed climate-related risks and opportunities in line with
our strategy. Principally, we have quantified both physical severity risk scores and projected financial impacts
(expressed as an Average Annualised Loss) from 2020 to 2100 for every asset under each warming scenario
assessed.

– We recognise the importance of continually improving both our climate scenario analysis methodology and

the metrics we use to track and monitor exposures across our portfolio, and therefore we will review and update
our results and key metrics as necessary to ensure we maintain an up-to-date picture of climate risk across our
investments and future acquisitions.

– BBGI is disclosing its Corporate Scope 1, 2 and 3 GHG emissions with a 2019 baseline. We have been certified
a Carbon neutral company for our 2021 Corporate Emissions. Over the course of the year we standardised the
reporting from our portfolio companies and from 2022 onwards will report on portfolio GHG emissions.

– Our targets for reducing our GHG emissions in line with the Paris Agreement have been set in line with science-

based targets that are consistent with achieving net zero global emissions by 2050, or sooner.

– As a result of our continuous stakeholder engagement and the robust materiality assessment performed in 2021,
as well as ongoing asset monitoring, we are now able to report a robust set of additional metrics and targets for
each of our ten most material ESG topics.

10 Disclose Scope

– Our GHG emissions inventory covers all GHG emissions from our Corporate Emissions and our Financed

1, Scope 2, and, if
appropriate, Scope
3 GHG emissions,
and the related
risks.

–

Emissions, as per the GHG Protocol.
In 2021, BBGI’s calculated Corporate Emissions are estimated to be c. 78 TCO2e (under the market-based
approach). Almost 49% of emissions analysed during this study are from business travel (mainly air travel). Due to
COVID-19, 2020 and 2021 are considered an outlier in terms of business travel emissions.
In 2019, BBGI’s calculated Corporate Emissions were estimated to be c. 273 TCO2e, which serves as our baseline
year.

– Our GHG emissions have been independently verified for 2019, 2020 and will be for 2021. BBGI is a certified CO2

Assessed Organisation.

Scope

Scope 1

Scope 1 Sub Total

Scope 2

Scope 2 Sub Total (location-based)

Scope 2 Sub Total (market-based)

Scope 3

Activity

Gas

Electricity (location-based)

Electricity (market-based)

Air travel

Upstream well-to-tank

Home-working

Personal vehicles for business
purposes

Employee commuting

Other

Scope 3 Sub Total

Location-based total tonnes of CO2e

Market-based total tonnes of CO2e

2021
Tonnes CO2e

13.40

3.70

7.20

3.70

7.20

32.95

11.22

4.98

4.29

3.69

0.58

57.71

74.81

78.31

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTESG (Environment, Social and Governance) continued

Metrics and Targets

TCFD Recommendation

Progress to date

11 Describe the

targets used by
the organisation to
manage climate-
related risks and
opportunities
and performance
against targets.

–

Targets have been set in line with science-based targets that are consistent with achieving net zero global
emissions by 2050, or sooner.

The main driver for achieving Financed Emissions reduction targets will come from the increasing alignment of
portfolio companies with net zero pathways.

– BBGI rarely has operational control at its portfolio companies, so the achievement of the targets and objectives
will be highly dependent on successfully influencing stakeholders (typically our public sector clients) into taking
action to achieve these goals.

– BBGI’s commitment to net zero can be distilled into various targets:

Corporate Emissions

– Reduce our Corporate Emissions Scope 1, 2 and 3 by 50% by 2030 (aligned to a ‘Paris-Aligned’ reduction

pathway using the absolute contraction approach).

– Net zero Corporate Emissions Scope 1, 2 and 3 by 2040.

– Carbon neutral from 2021 onwards at corporate level. All residual, including unavoidable Corporate

Emissions, will be offset by purchasing high quality offsets to obtain carbon neutrality beginning in 2021.

Financed Emissions

– Report Financed Emissions (Scope 1 and Scope 2 at portfolio companies) for 100% of portfolio companies

beginning from 2022 onwards.

– Engage with our top 20% of emitters to discuss emission reduction strategies by 2024.

– Develop net zero plans for 50% of portfolio companies by 2025 and for 100% of portfolio companies by 2030.

– Reduce our Financed Emissions portfolio companies Scope 1 and 2 emissions and, to the extent possible,

material portfolio companies Scope 3 emissions by 50% by 2030.

–

– Overall net zero Financed Emissions by 2050 or sooner.
Throughout 2022, we will continue to build on the results of the physical climate change scenario analysis,
working with our asset managers and public sector clients to set clear targets which support the effective
management of climate-related risks and opportunities.

– Going forward we will consider each new acquisition using the same physical climate risk analysis.

More details on our targets scope, time frame, base year and metrics can be found in the ‘Net Zero
commitment’ section of this Annual Report.

BBGI Global Infrastructure S.A. | Annual Report 2021

ESG (Environment, Social and Governance) continued

Sustainable Finance Disclosure Regulation (SFDR)
The EU SFDR is a new set of European Union rules that came into effect on 10 March 2021, which aim to provide transparency on sustainability
within financial markets with the goal to making the sustainability profile of funds more comparable and easier to understand for investors. SFDR
focuses on categorising products into specific types, providing information with regards to the integration of sustainability risks and pre-defined
metrics for assessing the ESG impacts of the investment process.

BBGI is an Article 8 product under SFDR
Under SFDR, the Company takes the view that it falls within the scope of Article 8, where the investment product promotes social characteristics
and follows good governance practices. The information on this page describes our approach to SFDR. More information is available in our SFDR
Disclosures here: www.bb-gi.com/esg/.

How does SFDR impact BBGI?
As currently prescribed under SFDR, from January 2023 onwards, there will be a mandatory requirement under SFDR to consider all mandatory
and certain selected voluntary SFDR indicators as part of our approach to ESG integration, and to disclose our consideration of these indicators
through a Principal Adverse Sustainability Impact statement.

To be ready for these new requirements, we reviewed the new SFDR framework and identified the necessary data which will have to be collected
from our portfolio companies. Our existing 23-questions ESG KPI survey was updated and expanded into an 82-question screening tool covering
all aspects of our ESG oversight. This new document, BBGI’s ESG Best Practice Guide, was introduced to all our portfolio companies and
subcontractors during various webinars in 2021.

The 82-questions screening and management tool will provide us with the appropriate date so we can report against the new mandatory and
voluntary metrics in the future. Where possible and appropriate, each response is scored against our own minimum requirements, industry
benchmarks and national statistics or against a relative year-to-year improvement. As a result, our portfolio becomes a reference group, from which
we can set targets for future improvements.

Description of Principal Adverse Sustainability Impacts
BBGI is committed to having a robust internal approach in place to ensure we identify and properly consider how our investment decisions
may have positive and/or negative impacts on the environment, people and society35. Sustainability impact assessment is central to our long
term oriented investment approach, which integrates environmental, social and governance factors into our strategy, investment approach, risk
management, due diligence process, asset management and reporting.

Principal Adverse Sustainability Impacts indicators
BBGI began the process of collecting the required information and will report against SFDR Principal Adverse Sustainability Impact indicators.

35 Article 2(24), SFDR: this includes principal adverse impacts on sustainability factors, which means ‘environmental, social and employee matters, respect for human rights,

anticorruption and antibribery matters’.

BBGI Global Infrastructure S.A. | Annual Report 2021

CORPORATE GOVERNANCEFINANCIAL STATEMENTSCOMPANY OVERVIEWSTRATEGIC REPORTCorporate Governance

Introduction

Our Governance Structure
BBGI is internally managed and operates with a two-tier governance
structure that comprises a Management Board and a Supervisory
Board. The responsibilities of each are outlined in this Report.

Governance and Regulatory Environment
As an internally managed investment company, having effective controls
in place is paramount to securing the sound financial and operational
performance of the Company’s investments. The Company recognises
the importance of effective engagement with its stakeholders, viewing it
as a key part of its own long-term success and sustainability.

BBGI is a member of the Association of Investment Companies (‘AIC’)
and as such reports against the AIC Code of Corporate Governance
(the ‘AIC Code’).

The Company have considered the Principles and Provisions of the
AIC Code. The AIC Code addresses the Principles and Provisions set
out in the UK Corporate Governance Code 2018 (the ‘UK Code’), as
well as setting out additional Provisions on issues that are of specific
relevance to the Company as an Investment Company. BBGI considers
that reporting against the Principles and Provisions of the AIC Code,
which has been endorsed by the Financial Reporting Council, provides
relevant information to shareholders.

For the most part, the Company has complied with the Principles
and Provisions of the AIC Code and where it currently does not, an
explanation is provided. Those specific Provisions where the Company
does not comply are outlined below along with the section reference
for the accompanying explanation:

– AIC Code Provision 10 (at least half the board excluding the chair,

should be non-executive directors which the board considers to
be independent): see Management Board – General section on
page 65;

– AIC Code Provision 13 (circumstances likely to impair, or appear to

impair a non-executive director’s independence – serving in excess
of nine years): See Board Composition, Tenure and Diversity section
on page 66;

– AIC Provision 17 (in relation to establishing separate Management
Engagement Committee): See Committees of the Supervisory
Board on page 63;

– AIC Provision 23 (All directors should be subject to annual re-

election by the shareholders): See Management Board – General
section on page 65.

Whilst BBGI is a non-domiciled publicly listed entity on the UK London
Stock Exchange, to which the UK Companies Act 2006 (the ‘CA2006’)
has limited application, the Company recognises the value that all its
stakeholders bring to the business. As such, BBGI acknowledges the
continuing requirement under Section 172(1) CA2006 for boards of
UK large or publicly listed companies to take stakeholder interests
into account and further to report on how they have done so when
performing their duties.

Details of how the Company adopts the spirit of those provisions
and considers its stakeholders can be found in the ESG section of
this Annual Report, which details the Company’s commitment to
generating positive and sustainable outcomes for our stakeholders.

Management Board
The Management Board is responsible for the management of the
Company and its representation vis-à-vis third parties (e.g., entry into
agreements on behalf of the Company). Its principal responsibilities lie
in all operational management activities of the Company, including the
discretionary investment management of the Company’s investments
as well as setting and implementing the overall strategy for the Group.
The Management Board is ultimately responsible for implementing risk
management, monitoring operational risks and measures related to risks.

In carrying out the function of investment manager via the
Management Board, the Company does not engage an external
investment manager to provide such investment management services.

The Management Board is also responsible for the overall
administration of the Company, including the preparation of semi-
annual valuations; statutory financial statements; management
accounts and the business plan that defines the Company’s active
approach to asset management. Given its role as investment manager,
the Management Board is the primary interface for investor relations,
including engagement with the Supervisory Board on shareholders’ behalf.

Supervisory Board
The roles of the Supervisory Board are (a) to appoint and, where
relevant, dismiss the members of the Management Board; (b) carry
out the permanent supervision of the management of the company
by the Management Board, without being authorised to interfere
with such management, and (c) exercise the powers attributed to the
Supervisory Board by the Company’s articles which include: supervising
and monitoring the appointment of the Company’s service providers
and those of its subsidiaries; reviewing the levels and structure of the
remuneration, compensation, and other benefits and entitlements of
the Management Board; considering any prospective issues, purchases
or redemptions of shares that are proposed by the Management Board;
reviewing and monitoring compliance with the corporate governance
framework and financial reporting procedures within which the
Company operates; reviewing and (if thought fit) approving interim and
annual financial statements and providing general supervisory oversight
to the Management Board and the operations of the Group as a whole.

The Supervisory Board consists solely of the independent Non-
Executive Directors and the Supervisory Board Chair, who was also
considered independent at the time of her appointment.

Notwithstanding this, the Directors on both the Management and
Supervisory Boards are accountable under the Listing Rules as the
Listing Rules do not distinguish between different types of directors.

In particular, for such time as the Company’s shares are listed on
the Official List of the UK Listing Authority, the Supervisory Board
and the Management Board act as one in approving any circular or
corporate action where the Listing Rules require the recommendation
of the board of directors of a publicly listed company (or where such
recommendation is customarily given). Any responsibility applied to
Directors under the Listing Rules applies to all directors of the Company.

BBGI Global Infrastructure S.A. | Annual Report 2021

Relevant Application of European Union
and Luxembourg Law

The Company is regulated by the CSSF under Part II of the amended
Luxembourg law of 17 December 2010 on undertakings for collective
investments, and is subject to the Luxembourg amended law of 12
July 2013 on Alternative Investment Fund Managers (‘AIFM Law’) that
implemented the EU Alternative Investment Funds Managers Directive
(‘AIFMD’) into national legislation.

AIFM
There have been no material changes during the year in respect of Art.
20 Para. 2(d) of the AIFM Law that would warrant further disclosure to
shareholders.

Material Risk Takers
There has been no change in the Company’s Material Risk Takers,
who, in accordance with Luxembourg’s AIFM law of 12 July 2013, are
identified as the members of the Management Board.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTSupervisory Board and Management Board

As at 31 December 2021

Name

Function

Independence

Age

Original
appointment

Next
renewal
date

Attendance at Meetings (meetings held in the year)

Supervisory Board

Supervisory
Board
(7)

Audit
Committee
(3)

Nomination
Committee
(4)

Remuneration
Committee
(4)

Sarah Whitney

Chair of Supervisory
Board

Independent

01-May-19

29-Apr-22

Howard Myles

Senior Independent
Director

Independent

03-Oct-11

To step
down 29-
Apr-22

Jutta af
Rosenborg

Chair of Audit
Committee

Chris Waples(i)

Director of the
Supervisory Board

Management Board

Duncan Ball

Member of the
Management Board

Frank Schramm

Member of the
Management Board

Michael Denny

Member of the
Management Board

Independent

01-Jul-18

29-Apr-22

Independent

01-May-21

29-Apr-22

Non-independent

05-Oct-11

05-Oct-22

Non-independent

05-Oct-11

05-Oct-22

Non-independent

30-Apr-13

30-Apr-22

Attendance at Meetings
Management Board (24)

(i)

Mr Waples was appointed with effect from 1 May 2021, and attended all meetings held following his appointment. Additionally, Mr Waples was invited to attend the
Supervisory Board meeting held 29 April 2021 as an observer.

The tables above set out the expiry dates of the current terms of the Directors’ appointments, as well as meeting attendance. All appointments may
be renewed in accordance with the provisions of the Company’s Articles.

BBGI Global Infrastructure S.A. | Annual Report 2021

Biographies of Directors

Supervisory Board

Sarah Whitney
Chair of the Supervisory Board
and Nomination Committee

Ms Whitney brings a 35-year career
advising on strategy, corporate finance,
real estate and economic matters. Her
executive roles included corporate finance
partner at PricewaterhouseCoopers;
she set-up and led the Government &
Infrastructure Team at CB Richard Ellis;
and prior to that, she was head of the
Consulting & Research business at DTZ
Holdings plc (now Cushman & Wakefield).

For over 15 years, Ms Whitney’s career
has been focused on the provision of
consultancy services to national and local
governments, investors, and real estate
companies on matters pertaining to real
estate, economic growth, infrastructure
and investment. Her early career was
spent as an investment banker advising
major corporates on M&A transactions.

Ms Whitney became Chair of the
Supervisory Board on 31 July 2020. Ms
Whitney is also Chair of the Nomination
Committee.

Ms Whitney has a BSc in Economics &
Politics from the University of Bristol and
is a Fellow of the Institute of Chartered
Accountants of England and Wales.

Ms Whitney serves as a Non-Executive
Director of two other listed companies;
JPMorgan Global Growth & Income plc
(where she also serves as Chair of the
Audit Committee) and Tritax EuroBox plc
(appointed with effect from 14 February
2022). She is Treasurer and a Member of
the Council of University College London.

Howard Myles
Chair of the Remuneration
Committee and Senior
Independent Director

Howard Myles began his career in
stockbroking in 1971 as an equity salesman,
before joining Touche Ross in 1975 where
he qualified as a chartered accountant.
In 1978, he joined W. Greenwell & Co
in the corporate broking team, and in
1987 moved to SG Warburg Securities
where he was involved in a wide range of
commercial and industrial transactions, in
addition to leading Warburg’s corporate
finance function for investment funds. Mr
Myles worked for UBS Warburg until 2001
and was subsequently a partner in Ernst &
Young LLP from 2001 to 2007, where he
was responsible for the Investment Funds
Corporate Advisory team.

Mr Myles became Senior Independent
Director on 31 August 2018, and Chair
of the Remuneration Committee on 29
June 2020.

Mr Myles holds an MA from Oxford
University.

He is a Fellow of the Institute of Chartered
Accountants and a Fellow of the
Chartered Institute for Securities and
Investment.

Mr Myles serves as a Non-Executive
Director of three other listed investment
companies; Baker Steel Resources Trust
Limited, Aberdeen Latin American
Income Fund Limited and Chelverton UK
Dividend Trust plc.

Having served as a Non-Executive
Director of the Company since IPO, Mr
Myles will step down, and does not intend
to stand for re-election, at the upcoming
2022 AGM.

Jutta af Rosenborg
Chair of the Audit Committee

Chris Waples
Independent Director

Jutta af Rosenborg has extensive
experience in management and strategy
derived from senior operational roles in
a number of companies and significant
experience with group finance and
auditing, risk management, mergers &
acquisitions and streamlining of business
processes.

Ms af Rosenborg served as the Chief
Financial Officer, Executive Vice President
of Finance and IT, and Member of the
Board of Management at ALK-Abelló A/S
until 2010. Prior to this, Ms af Rosenborg
served at Chr. Hansen Holding A/S as its
Vice President of Group Accounting from
2000 to 2003. From 1978 to 1992, she
worked for the Audit Group at Deloitte.

Ms af Rosenborg became Chair of the
Audit Committee on 31 August 2018.

Ms af Rosenborg obtained a certificate
in Business Administration from
Copenhagen Business School in 1982,
gained an MSc in Business Economics
and Auditing from Copenhagen Business
School in 1987 and qualified as a state
authorised public accountant in 1992.

Ms af Rosenborg serves as a Non-
Executive Director on three other listed
companies; abrdn plc, Nilfisk Holding
A/S and JP Morgan European Growth &
Income PLC.

Chris Waples CDir FloD has 35 years’
global experience of managing the
acquisition, construction and divestment
of infrastructure projects. Mr Waples
has an extensive track record of asset
management in progressive high-profile
companies, including 12 years with the
John Laing Group plc where he held
the position of Executive Director Asset
Management and led the international
portfolio of PPP assets across Europe,
North America and Asia Pacific regions.

Mr Waples was a member of the executive
team that oversaw the successful initial
public offering of the John Laing Group
plc in February 2015 with approximately
a £1 billion market capitalisation.
Additionally, he held the positions of Chair
of the Investment Committee, Chair of
the Investment Portfolio Committee
and Trustee of the John Laing Charitable
Trust. He previously served as Managing
Director of Amey plc, for public and
private sector clients, before and leading
up to its acquisition by Groupo Ferrovial.
Prior to this, he held senior positions with
Scottish Power plc and Blue Circle plc.

Mr Waples is a Fellow and Chartered
Director of the Institute of Directors
and holds a Postgraduate degree
in Management Studies as well as
Agricultural Engineering LICG.

Mr Waples was appointed by shareholders
at the Company’s 2021 AGM as a Non-
Executive Director with effect from 1 May
2021.

Mr Waples does not hold any Non-
Executive Director positions at any other
listed company.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTBiographies of Directors continued

Management Board

Duncan Ball
Co-CEO and member of the
Management Board

Frank Schramm
Co-CEO and member of the
Management Board

Michael Denny
CFO and member of the
Management Board

Duncan Ball has been Co-CEO of BBGI
from inception and was actively involved
in the establishment and IPO of BBGI in
2011 and the subsequent growth from 19
assets at IPO to 54 assets at the end of the
reporting period.

Frank Schramm has been co-CEO of
BBGI from inception and was actively
involved in the establishment and IPO of
BBGI in 2011 and the subsequent growth
from 19 assets at IPO to 54 assets at the
end of the reporting period.

Mr Ball has worked in the infrastructure
sector, investment banking and advisory
business for over 30 years. As co-CEO
of BBGI, he is responsible for overall
strategy and management of the
Company. He is one of three members
of the Management Board and sits
on the Group’s Investment and ESG
Committees.

Mr Schramm has worked in the
infrastructure sector, investment banking
and advisory business for over 25 years.
As co-CEO of BBGI, he is responsible
for overall strategy and management
of the Company. He is one of three
members of the Management Board and
sits on the Group’s Investment and ESG
Committees.

Additionally, he is a shareholder
representative and holds directorships in
key investments of BBGI.

Michael Denny has over 20 years’
experience in corporate finance with a
focus on the infrastructure and real estate
sectors.

He joined BBGI in early 2012, shortly after
the Company’s IPO. As CFO of the Group,
he is primarily responsible for all corporate
financial matters including but not
limited to financial reporting, UK listing
requirements, taxation, foreign exchange
hedging and regulatory compliance. Mr
Denny is a member of the Management
Board and sits on the Group’s Investment
and ESG Committees.

BBGI Global Infrastructure S.A. | Annual Report 2021

Supervisory Board

General
The Supervisory Board currently consists of four Independent Non-
Executive Directors.

In accordance with the Articles, all members of the Supervisory Board
are elected for a period ending at the AGM of the Company in April
each year, at which time they are required to retire. They may, if they
so wish, offer themselves for re-election by shareholders. However, re-
appointment is not automatic.

The Supervisory Board believes that its members continue to have an
appropriate combination of skills, experience and knowledge to enable
them to fulfil their obligations.

The Supervisory Board members have a breadth and diversity of
experience relevant to the Company, and the Company believes that
any future changes to the composition of the Supervisory Board can be
managed without undue disruption.

The Supervisory Board meets at least four times a year and between
these formal meetings, there is regular contact with the Management
Board and the Company’s corporate brokers. Where necessary, both
Supervisory and Management Board members also have access to
independent professional advice at the expense of the Company.
The Supervisory Board considers items laid out in the Notices and
Agendas of meetings which are formally circulated to its members in
advance of the meeting as part of the Board papers. At each meeting,
members are required to advise of any potential or actual conflicts of
interest prior to discussion.

In performing its role, the Supervisory Board meets at least quarterly
where it reviews investment performance and associated matters,
compliance and risk management activities, the performance of key
service providers, investment and financial controls, marketing and
investor relations, general administration, peer group information,
industry issues and other matters relevant to fulfil the supervisory
oversight remit.

four independent Non-Executive Directors who are also members of
the Supervisory Board: Jutta af Rosenborg is Chair of the Committee,
and Sarah Whitney, Howard Myles and Chris Waples are the other
members. Mr Myles will step down as a member of the Committee at
the conclusion of the 2022 AGM. The AIC Code Provision 29 states
that the Chair of the Board should not chair the Audit Committee, but
can be a member if they were independent on appointment. The Board
and Committee are of the opinion that Ms Whitney’s experience and
competencies, along with the relatively small size of the Board, warrants
her membership of the Committee. Furthermore, Ms Whitney was
considered to be independent on appointment.

The Audit Committee is required to report its findings to the
Supervisory Board, identifying any matters on which it considers that
action or improvement is recommended. In the event of any conflict
between the provisions of the AIC Code and the provisions of the law
on the Audit Profession, the Company will comply with the provisions of
the law on the Audit Profession and will disclose any such conflict.
The External Auditor is invited to attend and present the conclusions
of its work at those Audit Committee meetings at which the annual
and interim financial statements are considered, and at other times if
considered necessary by the Audit Committee.

The Audit Committee meets not less than three times per year,
and at such other times as the Audit Committee Chair may require.
Additional meetings may be requested by any other member of the
Audit Committee, or the External Auditor, if deemed necessary. Other
Directors and third parties may be invited by the Audit Committee to
attend meetings as and when appropriate.

Further details on the Audit Committee and its work during the year,
including details on the tendering and selection of a new External
Auditor can be found in the Audit Committee report.

The Audit Committee Chair attends each AGM of the Company and is
prepared to respond to any shareholder questions on the Committee’s
activities.

Each of the Supervisory Board members continues to be considered
as independent, and the Supervisory Board is not aware of any
circumstances which are likely to impair, or could appear to impair, the
independence of any of the Supervisory Board members.

The Audit Committee terms of reference are available on the
Company’s website and can also be requested directly from the
Company Secretary.

The Supervisory Board has formally established Audit, Remuneration
and Nomination Committees, further details of which are contained
below and in each of the respective Committee reports.

Audit Committee
In accordance with provision 29 of the AIC Code and the Disclosure
Guidance and Transparency Rules (‘DTR’) rule 7.1, the Company has
a formally constituted Audit Committee, to which the Supervisory
Board has delegated its responsibility for the general oversight and
monitoring of the Company’s compliance with various financial and
regulatory controls, in accordance with AIC Code and Disclosure and
Transparency Rules requirements.

The Audit Committee operated throughout the year in accordance
with the AIC Code. As indicated above, it does so within clearly
defined terms of reference, which are regularly reviewed, including
all matters indicated by DTR 7.1 and the AIC Code. It comprises the

Remuneration Committee
In accordance with AIC Code provision 37, the Company has a formally
constituted Remuneration Committee, to which the Supervisory Board
has delegated its responsibilities for establishing the general principles
of the policy for Directors’ remuneration and for setting remuneration
for the Management Board, as well as supervising the general
remuneration structure and levels for other employees.

It comprises the four Independent Non-Executive Directors who are
also members of the Supervisory Board: Howard Myles is Chair of the
Committee, Sarah Whitney, Jutta af Rosenborg and Chris Waples are
the other members. Mr Myles will step down from his position as Chair
at the conclusion of the 2022 AGM, with Andrew Sykes expected to
take over as Committee Chair.

On reviewing the levels and structure of the remuneration,
compensation and other benefits and entitlements of the Management
Board of the Company, the Remuneration Committee reports its
findings and any recommendations to the Supervisory Board.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTSupervisory Board continued

Further details on the work of the Remuneration Committee during the
year, along with information in relation to both Executive and Non-
Executive Directors’ remuneration, can be found in the Remuneration
Report.

The Nomination Committee Chair attends each AGM of the Company
and is prepared to respond to any shareholder questions on the
Committee’s activities.

In accordance with Provision 24 of the AIC Code, the Company has
a formal policy on the tenure of the Supervisory Board Chair. The
Company acknowledges the Supplementary Guidance under Provision
24 of the AIC Code with regard to a more flexible approach in respect of
chair tenure. In the case of the Chair, the need for regular refreshment
and diversity must be balanced with the skills and experience of the
existing Board and Committee members, and the benefit of retained
historic knowledge of the Company’s business, all of which are
considered as part of the succession plan.

The Nomination Committee terms of reference, which are kept under
regular review, are available on the Company’s website at www.bb-gi.
com/investors/policies/nomination-committee-terms-of-reference/
and can also be requested directly from the Company Secretary.

Further details on the Nomination Committee and its work during the
year can be found in the Nomination Committee report.

Management Engagement Committee
Oversight of delegates and key service providers is highly regulated
by the Luxembourg CSSF, including formal reporting structures,
regular visits and compliance monitoring plans in accordance with the
Company’s Oversight of Delegated Activities framework. In recognition
of the Management Board’s primary involvement in the process, the
Company being internally managed, and considering the size of the
Supervisory Board, the functions of a Management Engagement
Committee continue to be conducted by the Supervisory Board as a
whole, with Ms Whitney acting as Chair. As a result, the establishment of
a separate management engagement committee, as prescribed under
AIC Code Provision 17, was considered to be unnecessary as there is no
material benefit to the Company and its shareholders.

In its role as Management Engagement Committee, the Supervisory
Board met on five occasions during the year under review to consider,
together with the Management Board, the performance, effectiveness
and appropriateness of the ongoing appointments of the Company’s
third-party service providers under Principle H of the AIC Code.
During these meetings, the Management Board provides feedback
and key findings resulting from any onsite meetings with third-party
service providers as part of the Company’s programme of oversight of
delegates and key service providers.

Re-election of Supervisory Board members
In accordance with the Articles, Supervisory Board members are
elected for a period ending at the Company’s next AGM, at which time
they are eligible for reappointment. With the exception of Mr Myles,
who will step down on 29 April 2022 following the conclusion of the
2022 AGM, all other members of the Supervisory Board have decided
to offer themselves for re-election at the forthcoming AGM and, as a
result of the successful performance evaluation, the Supervisory Board
recommends the re-election of each of them.

The Remuneration Committee meets no less than two times per year,
and at such other times as the Remuneration Committee Chair may
require. Additional meetings may be requested by any other member
of the Remuneration Committee, if deemed necessary. Other Directors
and third parties may be invited by the Remuneration Committee to
attend meetings as and when appropriate.

The Remuneration Committee Chair attends each AGM of the
Company and is prepared to respond to any shareholder questions on
the Committee’s activities.

The Remuneration Committee terms of reference, which are kept
under regular review, are available on the Company’s website and can
also be requested directly from the Company Secretary.

Nomination Committee
In accordance with AIC Code provision 22, the Company has a formally
constituted Nomination Committee, to which the Supervisory Board
has delegated its responsibilities for appointing the members of the
Management Board and the appointment of any further Supervisory
Board members. Further details on the roles of each of the Committees
and their activities undertaken during the year can be found in the
section titled Committees of the Supervisory Board.

It currently comprises the four Independent Non-Executive Directors
who are also members of the Supervisory Board: Sarah Whitney is Chair
of the Committee, and Howard Myles, Jutta af Rosenborg and Chris
Waples are the other members.

The Nomination Committee meets to consider the renewal of
the appointments of the Management Board members (which
appointments are renewable annually for one year only), the
appointment of new Supervisory Board members, to review the
succession plans for both the Management and Supervisory Boards
and oversight of the annual performance evaluation of the Supervisory
Board and its formally constituted Committees.

In accordance with AIC Code provision 22, the Chair does not chair any
Committee meeting at which her succession is discussed.

The Nomination Committee meets not less than two times per year, and
at such other times as the Nomination Committee Chair may require.
Additional meetings may be requested by any other member of the
Nomination Committee, if deemed necessary. Other Directors and
third parties may be invited by the Nomination Committee to attend
meetings as and when appropriate.

In recruiting new Directors, the Nominations Committee actively
seeks greater diversity by gender, ethnicity, nationality and other
criteria, whilst remaining committed to selecting members on merit
with relevant and complementary skills to help the Company maximise
stakeholder value.

The Company will continue to make future appointments at all
levels on the basis of the full merits of the individual candidates, and
the strengths, skills and experience that they would bring to the
composition and balance of the Management and Supervisory Boards
or Company as a whole. The process of appointing any new Directors is
led by the Nomination Committee.

BBGI Global Infrastructure S.A. | Annual Report 2021

Management Board

General
The Management Board comprises three members, each contractually
engaged by BBGI Management HoldCo S.à r.l., a direct consolidated
100 per cent. held subsidiary of the Company. As a result, no member
is deemed independent under AIC Code Provision 10. However, the
Management Board’s functions are overseen by the Supervisory
Board which itself meets the independence criteria set out in Provision
10. Whilst this two-tier structure is not explicitly covered by the AIC
Code, the Company considers that an independent Supervisory Board
ensures the Company is compliant with AIC Code Provision 10. Under
AIC Code Provision 3, it is the Co-CEOs of the Management Board
who seek regular engagement with the Company’s major shareholders
in order to understand their views concerning significant matters.
The Chair of the Supervisory Board is, however, always available to
undertake such engagement at shareholders’ request.

The Company’s Articles require that the Management Board’s
members be elected on an annual basis by the Supervisory Board, and
not by shareholders. As a result, this does not meet the requirements of
AIC Code Provision 23, which requires that directors should be subject
to election by shareholders. However, as the Management Board carries
out the role of investment manager, the Supervisory Board deems it
appropriate that it elects the members of the Management Board.
The Articles also require that the members of the Supervisory Board
themselves be subject to annual election by shareholders, who may also
dismiss any such member. Accordingly, the Company considers that
this procedure satisfies the requirements of AIC Code Provision 23.

Performance evaluation and re-appointment
As stated above, the Management Board carries out the functions of
the Company’s investment manager, and its Directors are appointed by
the Supervisory Board for a period of one year, which is renewable. Mr
Ball and Mr Schramm were both originally appointed on 5 October 2011
at the time of the Company’s IPO, with Mr Denny originally appointed
to the Management Board on 30 April 2013.

Re-election of the Management Board members
The Supervisory Board evaluates the performance of the Management
Board and its Directors annually to ensure that the Management
Board and its individual members continue to operate effectively
and efficiently, and that the continued appointment of the individual
Directors is in the best interests of the Company and its shareholders.
Satisfied with the evaluations carried out in 2021, the Supervisory
Board resolved to renew Mr Denny’s appointment for a further term
of one year with effect from 30 April 2021, and those of Mr Ball and Mr
Schramm for a further term of one year with effect from 5 October 2021.

Internal controls
The Management Board has established an ongoing process and
system of robust internal controls designed to help the Company
manage the risks to which it is exposed. Processes have been put in
place to manage risk, oversee the internal control framework, and
determine the nature and extent of principal risks the Company is
willing to take to achieve its long-term strategic objectives. The policies
and procedures are reviewed at least annually, together with continual,
ongoing monitoring.

During the year, the Company’s Compliance and Risk functions
continued to review, assess and reinforce its already robust governance
and risk controls frameworks. Notwithstanding the challenges
presented by the COVID-19 pandemic, which limited in-person
meetings and on-site attendance to delegates’ offices, the Company
continued to stringently monitor and undertake due diligence
processes as part of its oversight of the appointed delegates. Where
physical meetings were not possible during the year, these interactions
were carried out remotely, by way of video and teleconferencing
facilities, and were supported by provision of documentary evidence of
any reported controls.

Furthermore, at each quarterly meeting, the Supervisory Board
monitors the Company’s investment performance against its stated
objectives and reviews its activities to ensure that the Management
Board is adhering to the investment policy and guidelines – including
clearly defined investment criteria, return targets, risk profile and
compliance framework. During these meetings, the Management
Board reports in relation to Key Performance Indicators (‘KPIs’) on
operating performance, cash projections, investment valuations and
corporate governance matters. The Head of Compliance and Risk
presents the Company’s interim and annual Risk report and quarterly
Compliance reports separately to meetings of both the Management
Board and Supervisory Board or to one of its formally constituted
Committees.

The ESG Committee oversees the management of material ESG activities,
including climate-related issues and reports to the Management Board on
any recommendations and proposed actions following each Committee
meeting. The ESG Committee meets at least quarterly, and membership
comprises the Co-CEOs, the CFO, the Director ESG / Sustainability and
the Company Secretary. Through the ESG Committee, the Management
Board remains informed about, amongst other areas, the dual risks to
the Company of transitioning to a low carbon economy (with associated
increased regulation) and the risk of physical impacts of climate change
on the assets in the portfolio. A full-time dedicated Director ESG /
Sustainability was appointed in March 2021.

The Company continues to delegate the Internal Audit function to
Grant Thornton Vectis in Luxembourg. Internal Audit reviews are
performed within the framework of a triennial audit plan as agreed upon
by the Management Board and Audit Committee and communicated
to the CSSF. Within this timeframe, the nature, timing and extent of the
internal audit procedures are determined by an assessment of the risk
related to specific activities, and by the complexity and sophistication
of the Company’s operations and systems, including the method
of controlling information processing. The Internal Audit summary
report is presented to the Audit Committee in March each year and is
subsequently submitted to the CSSF.

The Company recognises that effective control systems can only
seek to manage and mitigate the risks of failure to achieve business
objectives. They cannot eliminate them. By their very nature, these
procedures are not able to provide absolute assurance against material
misstatement or loss.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTManagement Board continued

Delegated functions
Amongst other requirements, the Company is required under the AIFM
Law to have dedicated Risk Management, Compliance, and Internal
Audit functions; each of which is required to be both functionally
and hierarchically separate from the functions of the operating units.
Accordingly, Grant Thornton Vectis is appointed to the role of Internal
Audit and was engaged for the full year ended 31 December 2021.

Internal Audit: Grant Thornton Vectis

The Head of Risk and Compliance is authorised by the regulator
to perform the risk management and compliance functions, and
reports to the Management Board and Supervisory Board or one of its
formally constituted Committees, as well as reporting to the respective
Designated Board Members who retain responsibility for overseeing
the performance of the respective functions.

Notwithstanding the above, the Company’s Management Board retains
overall responsibility for the correct and effective operation of the
delegated functions.

Other key delegates and providers:

Central Administrative Agent,
Depositary, Paying Agent,
Registrar and Transfer Agent:

RBC Investor Services Bank S.A
(‘RBC’)

Those shareholders who continue to hold their shares in issued
registered form have, in accordance with the Dematerialisation Law,
until 30 November 2022 to instruct their shares to be converted from
issued registered form to a dematerialised form, after which those
issued registered shares will be required to be mandatorily converted.

During the year, the Company continued to access the UK market
under the UK government established temporary permissions regime
(‘TPR’). As previously reported, this TPR was for a limited period of time,
after which the Company would have to provide notification under the
UK’s National Private Placement Regime (‘NPPR’) in order to continue
to market the Company in the UK. In June 2021, BBGI received
confirmation from the FCA of its ‘Landing Slot’ during which BBGI was
required to submit a notification under the NPPR in order to continue
to market BBGI to professional investors in the UK. In August 2021,
BBGI provided the necessary written notification to the FCA in advance
of the 1 November 2021 deadline.

Board members and other interests
The members of the Management Board are also BBGI Management
HoldCo S.à r.l. managers. Mr Ball and Mr Schramm both hold service
contracts and Mr Denny holds a management contract in respect of
BBGI Management HoldCo S.à r.l. Otherwise, no other member of the
Group held service or management contracts during the year under
review. Notice periods to and from the Company of 12 months apply in
respect of each of the members of the Management Board.

Depository (UK):

Link Market Services Trustees
(Nominees) Limited (‘Link’)

No loan has been granted to, nor any guarantee provided for the benefit
of, any Director by the Company.

Central Securities Depository:

LuxCSD S.A. (‘Lux CSD’)

Principal Agent:

Banque Internationale à
Luxembourg S.A. (‘BIL’)

Information Technology:

G.I.T.S. PSF

The Company’s shares are admitted to trading on the LSE main market
for listed securities. In this context, the Company has engaged Link as
depository, receiving agent and UK transfer agent. Listing on the LSE
provides liquidity for investors in what is otherwise a closed-ended
investment company, holding a portfolio of illiquid assets.

Link, acting in its depository capacity, as holder of in excess of 99.9 per
cent. of the issued ordinary shares in the Company, represents all the
ordinary shares that are ultimately subscribed for in dematerialised,
non-certified form. Link holds such dematerialised ordinary shares and
issues uncertificated depository interest holdings in order to facilitate
indirect holding of the Company’s shares by non-certified depository
interest holders. These non-certified dematerialised shareholdings are
held via shareholder nominee accounts as registered by LuxCSD. The
remaining issued ordinary shares are held directly on the certified share
register maintained by RBC. Accordingly, the Company’s share register
only lists the Certified Investors.

LuxCSD is appointed to act as the Company’s EEA-based CSD. BIL is
appointed to act as the required intermediary between the Company
and LuxCSD. Both LuxCSD and BIL are classified as delegates and
as such are subject to the appropriate level of delegate oversight in
accordance with the Company’s delegate oversight framework.

Ms Whitney, Mr Myles, Ms af Rosenborg and Mr Waples are all
considered to be independent Board members as they: (i) have not
been employees of the Company; (ii) have not had material business
relationships with the Company; (iii) have not received performance-
based remuneration from the Company; (iv) do not have family ties with
any of the Company’s advisers, Directors or senior employees; (v) do
not hold cross-directorships or have links with other Directors through
involvement on other companies; (vi) do not represent a significant
shareholder; and (vii) have not, with the exception of Mr Myles, served
on the Board for more than nine years. For further information on
tenure, refer to the section Board composition, tenure and diversity.

Refer to the Remuneration Report for details of the Directors’ holdings
in the Company’s shares.

Board composition, tenure and diversity
The Nomination Committee and the Management Board regularly
reviews the succession plans for the Company, with the ultimate
decision resting with the Supervisory Board. As part of a structured
succession plan, each of the original Non-Executive Directors plan to
retire on a staggered basis and the Company is recruiting additional
Non-Executive Directors over a timeframe that enables the knowledge
and experience built up over the preceding years to be both retained
and enhanced. As was highlighted in last year’s Annual Report, Mr
Myles will step down from his position as a member of the Supervisory
Board and each of the Committees, including his role as Senior
Independent Director and Chair of the Remuneration Committee,
following the conclusion of the Company’s 2022 shareholders’ Annual
General Meeting.

BBGI Global Infrastructure S.A. | Annual Report 2021

2022
The next Company AGM will be held on Friday 29 April 2022. In
accordance with the Law of 23 September 2020, as amended (the
‘COVID-19 Law’), the meeting will be organised without the physical
presence of participants. The Notice of Meeting, proposed Resolutions
and Explanatory Notes, and the associated Proxy Form, will be
circulated to shareholders to meet the regulatory deadlines. These will
also be made available on the Company’s website.

Substantial Shareholdings
As at 31 December 2021, the Company had 712,125,805 shares in issue.
Pursuant to DTR5 of the FCA’s Disclosure Guidance and Transparency
Rules, the Company had received notice of substantial interests (5 per
cent. or more) in the total voting rights of the Company as follows, in
compliance with DTR 7.2.6R:

Name

M&G plc

Schroders plc

Newton Investment Management
Limited

Held

% of total share
capital1

59,502,903

56,304,964

39,947,825

9.42%

8.48%

8.46%

Investec Wealth & Investment
Limited

31,569,569

5.01%

Smith & Williamson Holdings Limited

28,885,124

5.00%

The percentage of voting rights detailed in the table above was calculated at the
time of the relevant disclosure made in accordance with Rule 5 of the Disclosure
Guidance and Transparency Rules and the shareholders’ percentage interests in
the Company may have changed since that date.

Management Board continued

The Management and Supervisory Boards of BBGI take into
full consideration both the gender and ethnic diversity of their
composition. They fully acknowledge the goals of FTSE Women
Leaders (formerly the Hampton-Alexander Review on Women on
Boards) and the Parker Review on Ethnic Diversity on Boards. Female
representation on the Supervisory Board at the reporting date stood at
50 per cent., exceeding the aim of the FTSE Women Leaders of having
at least one third representation of women on the Boards of FTSE 350
companies. Furthermore, following the conclusion of the 2022 AGM,
it is expected that female representation on the Supervisory Board will
increase to 60 per cent. and the Company will have met the target set
by the Parker Review.

The Company prides itself on being one of the few FTSE 350
companies with both a female Chair and Audit Committee Chair. In its
commitment to the goals of both the FTSE Women Leaders and the
Parker Review, the Nomination Committee keeps under review the
Group’s Diversity and Equality Policy, which seeks to enhance BBGI’s
existing culture of diversity, equality and inclusion, and the Group’s
adherence thereto.

The Company recognises that the gender composition goals extend
down to the Management Board, as well as direct reports to them.
As at 31 December 2021, 13 different nationalities were represented
by the Group’s employee base of 25 people. Given the relatively low
turnover and small number of staff employed across the Group, the
Management and Supervisory Boards are mindful of the naturally
limited opportunities that exist to promote greater diversity of gender
and ethnicity to senior roles within the Company, but believe the
Company takes all reasonable and practical steps to evolve diversity at
all levels of the Group.

Refer to the Nomination Committee Report for further details on board
composition, tenure and diversity.

General Meetings
2021
The AGM was held on 30 April 2021. There were no other shareholder
meetings held during the year.

The notice for the AGM (and associated documents) as well as the
results of the meeting can be found in the Investor Relations section of
the Company’s website.

In accordance with AIC Code Provision 4, it was reported subsequent
to the AGM that the Company received votes against Resolution 12
(Amendment to the Long-Term Incentive Plan) representing 20.77%
of those shares voting and 12.46% of the issued share capital. Further
details on the steps taken by the Company in response to this is given in
the Remuneration Committee Report.

No votes of 20 per cent. or more were cast against the Board
recommendations for any other resolutions.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTNomination Committee Report

Annual Statement from Nomination Committee Chair

Dear Shareholders,

I am pleased to present the Nomination Committee (the ‘Committee’)
report for the financial year ended 31 December 2021 on behalf of the
Supervisory Board.

Composition of the Committee
The Committee consists of a minimum of two members. The
Committee and its Chair are appointed by the Supervisory Board.
Membership is confined to Independent Non-Executive Directors.
Each of the four Independent Non-Executive Directors is a member
of the Committee, which is chaired by me, and our biographies can be
found in the Corporate Governance section of this Annual Report.

Responsibilities
The Nomination Committee meets to consider the renewal of
the appointments of the Management Board members (which
appointments are renewable annually for one year only); the composition
of the Supervisory Board and the appointment of new Supervisory
Board members; succession planning for both the Management and
Supervisory Boards; and the annual performance evaluation of the
Supervisory Board and its formally constituted Committees.

Appointment of Non-Executive Directors
As outlined in last year’s Annual Report, having undertaken an
assessment of the Supervisory Board’s size and composition, the
Nomination Committee recommended an increase in the number of
Non-Executive Directors to five members in order to better meet the
growing regulatory requirements of the Company and to widen the
skillset of the Supervisory Board, particularly with regard to sustainability.

The Nomination Committee oversaw the process for appointing
both Mr Myles’s replacement and a fifth member of the Supervisory
Board. Cornforth Consulting Limited, an external search consultancy
firm, was engaged to assist in this process. Cornforth’s knowledge of
investment companies and their understanding of the specific nature of
the Company’s structure and ongoing requirements ensured a targeted
search of candidates with the most relevant experience and suitable skills.

Following a successful conclusion to this search, the Company will seek
approval from its shareholders at the forthcoming AGM, to appoint Ms
June Aitken and Mr Andrew Sykes as new members of the Supervisory
Board with effect from 29 April 2022. Apart from this engagement,
there was no other connection between Cornforth Consulting Limited
and the Company or its Directors.

Key activities during the Year
During the year, the Committee met four times, with all members
present at each meeting.

Ms Aitken and Mr Sykes bring with them extensive experience which
will be further detailed in the Convening Notice for the 2022 AGM and
will further strengthen the composition of the Supervisory Board and its
Committees.

Supervisory Board Composition, Tenure and Diversity
As at the date of this report, Mr Myles has served as a Director of
the Company for a period exceeding nine years. The Nomination
Committee and Supervisory Board acknowledge that under Provision
13 of the AIC Code that this is one of a number of circumstances
which could impair, or appear to impair, a Non-Executive Director’s
independence. Mr Myles has nonetheless continued to demonstrate
independent judgement and challenge to the Management Board
throughout his tenure and the Company does not consider his
independence at any stage to have been compromised or impaired. Mr
Myles will retire at the forthcoming AGM.

As was reported in last year’s Annual Report, in accordance with the
Company’s succession plans, it is proposed that, subject to shareholder
approval at the 2022 AGM, Andrew Sykes be appointed to serve as his
replacement on the Supervisory Board. Subject to his appointment
to the Supervisory Board, Mr Sykes will also replace Mr Myles as Chair
of the Remuneration Committee and as a member of the Audit and
Nomination Committees. It is further proposed that June Aitken
be appointed, subject to shareholder approval at the 2022 AGM,
as an additional member of the Supervisory Board. If approved, Ms
Aitken would also serve as a member on the Audit, Nomination and
Remuneration Committees. Mr Sykes will replace Mr Myles as Senior
Independent Director.

We believe the Supervisory Board’s effectiveness is greatly enhanced
by diversity. Its members bring a varied range of skills and expertise to
the benefit of the Company’s stakeholders and we are proud that the
Supervisory Board has an equal gender balance.

During the year, the Nomination Committee oversaw and the Supervisory
Board approved certain amendments to the Group Diversity and Equality
Policy to further clarify BBGI’s commitment to promoting diversity and
equality. The Committee kept the Group’s adherence to the Policy under
review during the year, and further details on its implementation can be
found in the ESG section of this Annual Report.

BBGI Global Infrastructure S.A. | Annual Report 2021

Annual performance evaluation
During the year, the Supervisory Board conducted the annual
evaluation of its performance, that of its Chair, and each of the
Committees, and considered the term and independence of each
member. Having undertaken an external evaluation in 2020, this year’s
evaluation was by means of questionnaires devised internally and in line
with good corporate governance.

These separately covered the Supervisory Board and its Chair, and the
three Committees: the Audit Committee, the Nomination Committee
and the Remuneration Committee. The conclusions from each of the
evaluations were subsequently formally considered and discussed by all
members of the Supervisory Board.

In considering the outcomes of the evaluation, the Nomination
Committee agreed that the composition of the Supervisory Board and
its respective Committees reflected a suitable mix of skills, experience
and knowledge; that each body was functioning effectively; and that
the performance of each individual member continued to be effective.
Notwithstanding this conclusion, the Supervisory Board were of the
view that the increasing importance of ESG warranted the appointment
of an additional candidate with suitable experience. Ms Aitken had since
been identified as having the relevant skills. Additionally, a small number
of areas for attention were proactively identified from this evaluation
process, with the primary agreed outcome being the formalisation of
annual Committee plans to ensure all pertinent matters continued to be
allocated sufficient time for discussion and deliberation by all relevant
stakeholders.

In accordance with provision 14 of the AIC Code, the performance of
the Chair was also evaluated by way of questionnaire and led by the
Senior Independent Director. The results were discussed with the Chair
and the remaining members. The Chair’s evaluation concluded that she
continues to perform her role effectively.

Nomination Committee Report continued

The Chair in turn evaluated the performance of each member of the
Supervisory Board. It was concluded that each member continued to
perform their duties effectively and throughout the reporting period,
each member had, and was expected to continue to have, sufficient
capacity to carry out their duties properly with no one member being
over-boarded by other directorships.

As a FTSE 350 constituent, AIC Code Provision 26 requires that an
externally facilitated evaluation of the Supervisory Board must be
carried out at least every three years, with such evaluation having
been most recently conducted in December 2020. The Company
remains committed to undertaking externally facilitated reviews at least
every three years in accordance with the AIC Code, with the next such
evaluation therefore required to take place no later than the end of 2023.

Renewal of Executive Director Mandates
The performance of each member of the Management Board was
reviewed by the Supervisory Board. Each member was considered to
have performed his duties effectively, and were therefore reappointed
for a further year.

In respect of succession planning, the plans developed for all senior
positions were reviewed. These plans are regularly updated by the
Management Board and reviewed by the Nomination Committee at
least annually.

The Year Ahead
The Committee will meet regularly in 2022 to ensure continued
progress is made on gender and ethnic diversity and that these
continue to be key areas of focus for both the Management and
Supervisory Boards’. The Committee will continue to strive for achieving
the best possible results for all stakeholders in performing its duties
in 2022, including in the undertaking of the annual performance
evaluation process and in actioning the outcomes of the 2021
evaluation.

Approval
This Report was approved by the Board on 30 March 2022 and signed
on its behalf by:

Sarah Whitney
Nomination Committee Chair

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRemuneration Committee Report

Annual Statement from Remuneration Committee Chair

Dear Shareholders,

I am pleased to present the Remuneration Committee (the ‘Committee’)
report for the financial year ended 31 December 2021 on behalf of the
Supervisory Board.

Composition of the Committee
The Committee consists of a minimum of two members. The
Committee and the Chair thereof (who cannot be the Chair of
the Supervisory Board) are appointed by the Supervisory Board.
Membership is confined to independent Non-Executive Directors.
Each of the four Independent Non-Executive Directors is a member
of the Committee, which is chaired by me, and our biographies can be
found in the Corporate Governance section of this Annual Report.

Key activities during the Year
During the year, the Committee met four times, with all members
present at each meeting.

Responsibilities
The Committee is responsible for establishing the general principles
of the policy for Directors’ remuneration and for setting remuneration
for the Management Board and also for the Supervisory Board, in
accordance with the Principles and Provisions of the Code and the
terms of the Remuneration Policy.

This Remuneration report has been prepared in compliance with
the reporting obligations as outlined in the relevant Luxembourg
legislation. Furthermore, and in the interest of greater transparency, the
Company has again taken the voluntary decision to disclose additional
remuneration detail, beyond its legal reporting obligations.

The Company continues to comply with the provisions of the AIC Code
in respect of remuneration and those of the relevant AIFMD regulations.

Business context and external environment
2021 was another year of economic uncertainty as COVID-19 continued
to disrupt businesses around the world. Against this backdrop, the
Company has continued to deliver strong, and resilient financial and
operational performance across our globally diversified, low-risk
portfolio of essential social infrastructure investments.

The health and safety of our employees and the continued provision of
essential infrastructure services to our public sector clients remained
our key priorities in the year.

Furthermore, the preservation of value, and where possible
enhancing the value of the Company’s existing portfolio remained a
key focus for management. While the pandemic affected society at
large in those locations where the Company invests, the Company
experienced no material COVID-19 related operational or financial
impact, again demonstrating the hard work of the team and the
successful construction of a portfolio consisting of resilient and high-
quality availability-based assets. We have not entered any furlough
arrangements globally or made redundancies as a result of the pandemic.

Our proven investment strategy of acquiring and managing low-risk,
availability-based assets has supported a 9.4 per cent. increase in
NAV to £1,001.6 million and a 2.1 per cent. increase in NAV per share
during 2021. In turn, the Company has met its full-year dividend target
of 7.33pps, an increase of 2.1 per cent. compared to the prior year
and strong coverage of 1.31x. Accretive and pro-active management
activities resulted in £13.1 million of value enhancements over the period
and contributed to the strong portfolio performance.

BBGI Global Infrastructure S.A. | Annual Report 2021

At BBGI, sound ESG practices are integral to building a resilient
business and creating long-term value for our investors and other
stakeholders. Investing sustainably and responsibly in social
infrastructure is central to BBGI’s business model. The majority of the
Company’s employees have ESG related targets and the Management
Board’s remuneration framework includes both LTIP and STIP metrics
related to ESG.

Key activities during the year
In recognition of the significant growth in the business and
increased complexity of the organisation, an independent review
of the remuneration of the Co-CEOs was conducted in 2020, with
the previous such review carried out in 2014. In the interests of
greater transparency, the Company voluntarily disclosed additional
remuneration detail in last year’s Remuneration Report. The
amendment of the Company’s long-term incentive plan was also
presented for shareholder approval at the 2021 AGM. In accordance
with AIC Code Provision 4, it was reported that 20.77 per cent. of votes
cast were against this resolution.

Whilst we were pleased to receive support from a significant majority of
shareholders who approved the proposals, the Supervisory Board is also
cognisant of the objections requiring consultation with shareholders
and disclosure of actions taken in response. Accordingly, I followed up
by writing to some 17 major shareholders including those shareholders
who voted against the proposal, in order to understand their position
and perspectives in relation to the increases made to the maximum
opportunity under the LTIP and to further inform them about:

–

the changes in the remuneration of the Management Board
resulting from the review undertaken in 2020, placing these into
the context of the remuneration of companies in the FTSE 250
share index, as indicated in the survey published by Deloitte in
October 2020; and

–

the process undertaken by the Committee in relation to the review.

Shareholders were also invited to contact me if they had further
questions or views they wished to express. Following this letter, I had
a telephone conversation with one shareholder, with no subsequent
follow-up.

The Committee reiterates its original statement that careful
consideration was given to the executive remuneration structure,
which included obtaining independent external advice to ensure that
the framework is in line with comparative FTSE 250 peers and best
practice guidelines. Furthermore, the significant growth and increasing
complexity of the business since our last remuneration review
presented a clear need to ensure that we are able to retain the high-
performing senior executive talent that has provided the shareholders
with significant returns on investment since IPO.

The changes made to the structure included the introduction of
features such as bonus deferral and post-employment shareholding
requirements, designed to ensure that executive and shareholder
interests are closely aligned and focused on long-term sustainable
performance. The Committee will continue to actively consider and
take account of issues raised by shareholders in any future review of
remuneration arrangements.

The Committee continues, as always, to be available to shareholders
and to welcome engagement on such matters.

Remuneration Committee Report continued

Other key decisions during the year
Salary increases
Management Board salaries were reviewed with effect from 1 May
2021, and the Committee carefully considered salary levels in the
context of current positions relative to the market, development in their
roles, individual performance and the level of pay increases for BBGI
employees generally. Management Board members were awarded an
increase of 2.1 per cent., which is below the average increases applied to
the majority of employees.

Annual bonus (FY21) outcome
For the financial year ended 31 December 2021, the Co-CEOs and
CFO were each eligible for a maximum bonus of 150 per cent. of base
salary as at 31 December 2021. The annual bonus was assessed against
a range of stretching financial and strategic KPIs, as outlined further in
this report. The Management Board delivered excellent performance
and progress against the targets set, with the annual bonus outcomes
being 97.3 per cent. of the maximum opportunity in respect of the 2021
financial year. One-third of the earned bonus will be used to purchase
shares, to be held for three years.

LTIP outcome (2018 award)
In December 2018, LTIP awards were granted to the Co-CEOs and
CFO. These equated to an award value of 150 per cent. of salary for the
Co-CEO, and EUR 100,000 for the CFO, and were based on stretching
TSR and NAV growth targets. The 2018 award will be released following
the publication of the Company’s 2021 audited accounts. 2018 awards
will vest at 76.3 per cent. and 94.8 per cent. of maximum for the Co-
CEOs and CFO respectively, reflecting performance against targets in
the three-year period to 31 December 2021.

No discretion was exercised in determining the annual bonus and
incentive outcomes described above.

Supervisory Board remuneration
During the year, the Committee also reviewed the remuneration of the
Supervisory Board members and concluded that no changes should be
made.

Howard Myles
Remuneration Committee Chair

30 March 2022

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRemuneration at a Glance

Key remuneration principles
BBGI’s remuneration framework is based on the following key principles:
– Attract and retain highly qualified executives and employees with a history of proven success.

– Align the interests of BBGI’s Management Board and employees with shareholders’ interests, the execution of the Company’s investment

–

policy and the fulfilment of the Company’s investment objectives.

Support strategy and promote long-term sustainable success.

Establish performance goals that, if met, are expected to be accretive to long-term shareholder value.

Link compensation to performance goals and provide meaningful rewards for achieving these goals. This incorporates both financial and
non-financial performance indicators, including key ESG goals and health & safety factors.

In considering Management Board remuneration during 2021, the Committee had regard to the principles of transparency, clarity, simplicity, risk
management, proportionality and alignment to culture.

Risk and conduct
BBGI’s remuneration policy encourages sound and efficient management of risks, and does not encourage excessive risk-taking. The
Remuneration Policy is consistent with sound and effective risk management through:

–

The implementation of a sound governance structure for establishing goals and for communicating performance goals to staff members to
ensure transparency;

–

The inclusion of both financial and non-financial objectives in performance and result assessments; and

– An appropriate mix of fixed and variable compensation to discourage inappropriate risk-taking.

In evaluating the components of variable remuneration, the Company considers the long-term performance and considers the current and
future risks associated with that performance and lifetime of the assets under management.

Summary of Management Board remuneration framework

Element

Base salary

Base salaries effective from 1 May 2021:
Co-CEOs: C$859,847 and €567,65236 CFO: €363,575

Pension and benefits Co-CEOs and CFO: 15% of salary (cash allowance).

The Co-CEOs receive a monthly car allowance.

Annual Bonus (STIP)

Co-CEOs and CFO: Maximum opportunity: 150% of salary. Target opportunity: 75% of salary (50% of maximum).

One-third of bonus is used to purchase shares to be held for a period of three years.

STIP is based on a balance of strategic, financial, operational, compliance and ESG/Health and Safety metrics with
robust quantitative and qualitative performance requirements set for threshold, target and maximum performance.

Long-Term
Incentive Plan (LTIP)

Co-CEOs: Performance measures established entitling beneficiaries to 50% of salary at threshold, 100% of salary at
target and 200% at maximum.

CFO: Threshold: 50% of salary, Target: 75% of salary, Maximum: 150% of salary.

Performance is measured over three years. For 2021 awards, 90% of the award will be subject to stretching
Net Asset Value Total Return targets and 10% will be subject to reduction in GHG emissions.

Shareholding
requirements

All Management Board members are required to build and maintain a minimum holding of BBGI shares with a value of
200% of salary37:

Post-employment shareholding requirements: Management Board members are required to hold 100% of salary in
shares for a period of two years after leaving the Company.

36 The Co-CEOs, Duncan Ball and Frank Schramm, are paid in Canadian Dollars and Euro, respectively. The CFO is paid in Euro.
37 This minimum holding is calculated based on the Director’s salary at 1 May 2020 and is fixed for a period of three years.

BBGI Global Infrastructure S.A. | Annual Report 2021

Remuneration at a Glance continued

Annual report on remuneration
Single total figure table – Management Board
The following table sets out total remuneration for each member of the
Management Board in respect of the year ending 31 December 202138.

In Pounds Sterling

2021

2020

2021

2020

2021

2020

Duncan Ball
(Co-CEO)

Frank Schramm
(Co-CEO)

Michael Denny
(CFO)

Salary

Benefits

Annual Bonus

Pension

LTIP1

Other

Total fixed

Total variable

495,275

456,921

484,872

467,173

310,555

275,758

13,956

728,093

74,804

13,799

713,994

73,456

13,605

712,799

73,233

13,874

720,917

456,540

461,739

74,168

46,905

47,504

490,259

565,204

522,452

593,770

95,170

106,526

–

584,035

544,176

571,709

555,215

357,460

323,262

1,218,352

1,279,198

1,235,252

1,314,687

551,710

568,265

Total remuneration

1,802,387

1,823,374

1,806,961

1,869,902

909,170

891,527

The 2018 LTIP vests by reference to performance in the three-year period to 31 December 2021. The associated shares will be released to the Management Board members
following the publication of the Company’s 2021 audited accounts.

The figures in the table above are derived from the following:

(a)

Base salary

The amount of salary earned in respect of the year, shown in the reporting currency of the Group (Pound
Sterling). Both Mr Denny and Mr Schramm receive all cash entitlements in Euro. Mr Ball receives all cash
entitlements in Canadian Dollars. The amounts shown in sterling are converted using the average exchange rate
for the respective financial year. For the year ended 31 December 2021, the relevant exchange rates were £1 =
C$1.7242 and £1 = €1.1627.

(b)

(c)

Benefits

The taxable value (gross) of benefits received in the year. These are principally car allowance.

Annual bonus
(STIP)

The value of the bonus earned in respect of the financial year of which one third will be paid in shares and held for
a period of three years. A description of achievements against the performance measures which applied for the
financial year is provided below.

(d)

Pension

The pension figure represents the cash value of any pension contributions including any cash payments in lieu of
pension contributions made in the year.

(e)

Long-term
incentives

The value of LTIP shares vesting, calculated by the estimated number of shares that vest in respect of the 2018
LTIP award multiplied by the average share price over the last quarter of the year ended 31 December 2021
(£1.741).

38 The detail provided in the table above goes significantly beyond that which is required to be disclosed under the relevant Luxembourg law. This additional detail is provided

on a voluntary basis commencing for the reporting period ended 31 December 2020.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRemuneration at a Glance continued

Additional disclosures in respect of the single figure table
Base salary
Each member of the Management Board receives an annual base salary which is payable monthly in arrears.

Management Board salaries were reviewed with effect from 1 May 2021, and the Committee carefully considered salary levels in the context of
current positions relative to the market, development in their roles, individual performance and the level of pay increases for BBGI employees
generally. Executive Directors were awarded an increase of 2.1 per cent., which was below the average increases applied to the majority of
employees.

Details of annual base salary for the Management Board are set out below.

Duncan Ball

Frank Schramm

Michael Denny

Base salary at 31
December 2021

Base salary at 31
December 2020

£501k

£477k

£305k

£484k

£500k

£320k

As noted above, both Mr Denny and Mr Schramm receive salaries in Euro (€363,575 and €567,652 respectively from 1 May 2021). Mr Ball receives
his salary in Canadian Dollars ($C859,847 from 1 May 2021). The figures in the table above are reported in Pounds Sterling, the Group’s reporting
currency, and therefore reflect not only the base salary increase of 2.1 per cent. but also the impact of exchange rate movements.

The combined annual base salary received by the members of the Management Board during the year ended 31 December 2021 was £1,290,702
(2020: £1,199,852).

Taxable benefits and pension-related benefits
The Co-CEOs received a monthly car allowance amounting to a total amount of £27,561 (2020: £27,673) for the year.

As shown in the Single Total Figure table, the Co-CEOs and the CFO also received a supplementary annual cash payment to provide pension,
retirement or similar benefits equating to 15 per cent. of their annualised base salary at 31 December 2021. BBGI has a small team of less than 30
employees in six different countries and individual pension arrangements across the team vary by location. In Luxembourg, where the majority of
staff are located, normal pension contributions are 8 per cent. of salary from the employer, 8 per cent. of salary from the state and 8 per cent. from
the employee.

STIP – Annual Bonus in respect of year ended 31 December 2021
The following table summarises the STIP performance metrics and achievements in respect of the financial year ended 31 December 2021. The
Remuneration Committee is responsible for determining both whether the relevant financial and non-financial performance objectives have been
satisfied and the level of award under the STIP for the relevant year. The Management Board delivered excellent performance and progress against
the targets set at the start of the year. No payment under the STIP is made if performance is below the Threshold criteria.

The maximum STIP opportunity for the Co-CEOs and the CFO is 150 per cent. of base salary.

BBGI Global Infrastructure S.A. | Annual Report 2021

Remuneration at a Glance continued

Performance assessed - summary

Threshold performance
(33% vesting equating
to 50% of base salary)

Target performance
(50% vesting equating
to 75% of base salary)

Maximum performance
(100% vesting equating
to 150% of base salary)

Outcome
(% of maximum)

Key financial targets
(15% weighting)

• Dividends paid and declared for the year.

• Growth in NAV per share.

Achievement against key primary financial metrics during the year including:

Achievement against operational financial metrics during the year including:

Operational financial targets
(10% weighting)

Disciplined growth
(25% weighting)

• Budgetary controls.

• Cash management.

• Ongoing charge.

• Other key financial performance metrics.

Achievement against key disciplined growth metrics including:

• The value, quality and pricing of projects acquired.

• The prospective investment pipeline at 31 December 2021.

Achievement against key metrics relating to strategic projects and
investments, including:

• Portfolio control and organisational effectiveness through the assessment

Portfolio management
(25% weighting)

of capacity.

• Project risk management, overruns and delays.

Compliance and regulation
(10% weighting)

ESG
(15% weighting)

Achievement against key compliance and regulatory metrics including:

• Key risk management controls.

• AIFMD compliance.

• Wider regulatory compliance and reporting quality.

• Management of issues related to Brexit.

• Management of delegated service providers.

Achievement against key ESG metrics including:

• ESG performance in accordance with BBGI’s ESG Best Practices Guidance

where appropriate or equivalent standards.

• Development of key ESG performance indicators and materiality

assessment.

100%

83%

100%

90%

100%

For 2021, awards of 146 per cent. of base salary were achieved by the Co-CEOs and CFO. One-third of the earned bonus will be settled in shares,
with the net number of shares after settling the associated tax liability to be held for a period of three years. The remaining STIP awards will be paid
in cash in May 2022. During the year ended 31 December 2021, the total amount accrued in respect of the 2021 STIP amounted to £1,897,433 (2020:
£1,896,650). Cash payments under the STIP are made in Canadian Dollars and Euros.

LTIP - awards granted during the financial year
LTIP awards of 200 per cent. of base salary were granted to the Co-CEOs in December 2021. The CFO’s maximum LTIP award is set at 150 per cent.
of base salary. All awards granted are within the approved limits under the current LTIP Plan.

For 2021 awards, 90 per cent. of the performance target will be subject to stretching Net Asset Value (‘NAV’) Total Return targets. NAV Total Return
reflects both capital returns generated and dividends returned to shareholders.

10 per cent. of the award will be linked to a reduction in corporate GHG emissions (Scope 1, 2 & 3) (against a 2019 baseline), a key climate related
ESG metric linked to BBGI’s Net Zero Plan. For the December 2022 award, the Remuneration Committee intends to introduce an additional metric
in order to track progress in the implementation of net zero plans across all BBGI assets (by value).

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRemuneration at a Glance continued

Performance metric

Threshold performance

Target performance

Maximum performance

NAV Total return
(90% weighting)

ESG – % Corporate GHG emissions
(Scope 1, 2 & 3)
(10% weighting)

Dividend of 7.33p per
annum to 2024, and NAV
per share maintained from
31 December 2021 to 31
December 2024.

Dividend growth of 2% per
annum to 2024; and 1% per
annum NAV per share growth
to 31 December 2024.

Dividend growth of 2% per
annum to 2024; and 2% per
annum NAV per share growth
to 31 December 2024.

GHG emissions as % of 2019 baseline (at 31 December 2024)

77%

75%

72%

For the Co-CEOs, 25 per cent. and 50 per cent. of the maximum award vests for threshold and target performance respectively. The award vests in
full for maximum performance.

For the CFO, 33 per cent. and 50 per cent. of the maximum award vests for threshold and target performance respectively. The award vests in full
for maximum performance.

A key feature of these awards is that they will be settled entirely by way of Company shares and not in cash. All LTIP awards, which are to be
settled by shares, fall under the scope of IFRS 2 ‘Share-Based Payments’ and its specific requirements. The Company continues to engage Ernst
& Young Advisory (‘EY’) to carry out the valuation of LTIP awards falling under the scope of IFRS 2. Refer to Note 20 of the Consolidated Financial
Statements for further details on share-based payments.

The 2021 award was issued in December 2021. No expense was accrued for this particular award during the reporting period.

During the year ended 31 December 2021, the Company settled the 2017 award obligation by issuing the respective gross share entitlement to
each member of the Management Board. In total the Company issued and allotted 730,785 shares by way of settlement.

As at the date of this Report, there are no amounts set aside, needing to be set aside or accrued by the Company to provide pension, retirement or
similar benefits to any member of the Management Board.

Total basic and variable remuneration for the financial year
The total basic remuneration paid to all members of staff (including the Management Board members) during the year ended 31 December 2021
was £3.15 million (2020: £2.88 million). The total amount accrued for cash-settled variable remuneration at 31 December 2021 was £2.26 million.
The total variable remuneration paid in cash in 2021 relating to the financial year ended 31 December 2020 was £1.75 million (2020: £1.53 million).

Payments made to former Directors and payments for loss of office during the year
No payments for loss of office and no payments to any former Management Board member were made in the year.

Single total figure table – Supervisory Board
The Supervisory Board members are the Company’s Independent Non-Executive Directors and are paid a fixed quarterly fee. The Remuneration
Committee consider the Non-Executive Directors’ fees annually within the approved maximum aggregate remuneration cap as approved by the
Company’s shareholders. No member of the Supervisory Board is entitled to vote on his or her own individual remuneration. Supervisory Board
members are not entitled to any other fees, pension payments, incentive plans, performance-related payments or any other form of compensation;
with the exception of ex gratia fees that are considered in the event of an exceptional and substantial increase in the members’ workload.

Single total figure of remuneration – Supervisory Board
During the year ended 31 December 2021 the Company paid Supervisory Board fees of £220,000 (2020: £208,570). The table below outlines the
fees paid in Sterling to each of the Supervisory Board members.

Sarah Whitney2

Howard Myles

Jutta af Rosenborg

Chris Waples3

Colin Maltby4

In Pounds Sterling

2021

2020

2021

2020

2021

2020

2021

2020

2021

2020

Base fee

65,000

53,333

45,000

30,000

Senior Non-Executive Director

Committee Chair

5,000

2,500

5,000

Other – additional fees1

5,000

Total

70,000

58,333

60,000

57,500

55,000

35,000

37,917

In addition to the standard fees each of the sitting Directors was entitled to additional fees in 2020 and 2021 in relation to equity issues.

1
2 Sarah Whitney was appointed Company Chair with effect from 31 July 2020 increasing her annual base fee entitlement from £45,000 to £65,000.
3 Chris Waples was appointed to the Supervisory Board with effect from 1 May 2021.
4 Colin Maltby stood down from the Supervisory Board on 31 July 2020.

BBGI Global Infrastructure S.A. | Annual Report 2021

Remuneration at a Glance continued

Supervisory Board fees
Details of Supervisory Board fees are set out below.

In Pounds Sterling

Chair

Senior Independent Director

Director

Committee Chair(i)

Fees from
1 January 2021

Fees from
1 January 2020

65,000

50,000

45,000

5,000

(i) This fee is paid to the Chair of the Remuneration Committee and the Chair of the Audit Committee.

Supervisory Board fees were last changed in 2017.

To accommodate the addition of further Non-Executive Directors to the Company, shareholders were asked to vote on increasing the maximum
aggregate remuneration cap from £300,000 to £400,000 at the 2021 AGM. A significant majority voted in favour of the resolution.

Share interests and statement of Directors’ shareholdings
Total share interests as at 31 December 2021
The interests of the Directors and their connected persons in the Company’s ordinary shares as at 31 December 2021 were as set out below.

Shares owned by Directors:

Number of shares

Management Board

Duncan Ball

Frank Schramm

Michael Denny

Supervisory Board

Sarah Whitney

Howard Myles

Jutta af Rosenborg

Chris Waples

Awards under share plans

Management Board

Duncan Ball

Frank Schramm

Michael Denny

Award

LTIP

At 31/12/2020

At 31/12/2021

548,490

635,660

500,000

600,000

262,015

412,415

39,000

17,321

Lapsed/
Forfeited
in the year

At 31/12/2021

At
31/12/2020(i)

Granted in

the year Vested in the year

1,695,384

569,916

(326,387)

(72,833)

1,866,080

1,763,131

547,914

(342,883)

(76,514)

1,891,648

457,942

263,200

(61,515)

(1,485)

658,142

(i) Reflects maximum potential number of shares under all the awards granted, including the 2017 award which was settled in May 2021.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRemuneration at a Glance continued

Shareholding guidelines:
The Committee has adopted a shareholding guideline for the Management Board, which requires a shareholding equivalent to 200 per cent. of
salary (increased from 150 per cent. of salary in 2020 for the Co-CEOs). Prior to adopting the shareholding guideline, the CFO had no contractual
shareholding requirement. Management Board members had until December 2021 to meet the minimum shareholding requirements. The
respective Management Board members achievement of this guideline at 31 December 2021 is summarised below:

Management Board

Duncan Ball

Frank Schramm

Michael Denny

Shares counting towards
the guideline at
31 December 2021

Required shareholding to
achieve(i)

Percentage of
shareholding requirement
achieved

635,660

600,000

412,500

576,190

375,000

110.3%

104.1%

110.0%

(i) Two times the revised base salary with effect from 1 May 2020 divided by the Company share price on date revised terms were agreed. The minimum holding requirement is

fixed for a period of three years and will be reset in 2023.

Post-employment shareholding requirements:
Management Board members are required to hold shares to the value of 100 per cent. of salary for a period of two years after leaving the Company.

Other information
Advisers
Deloitte LLP is retained to provide independent advice to the Committee as required. Deloitte is a member of the Remuneration Consultants
Group and, as such, voluntarily operated under the Code of Conduct in relation to executive remuneration consulting in the UK. Deloitte LLP’s
fees for providing remuneration advice to the Committee were £9.6k for the year ended 31 December 2021. The Committee assesses from time to
time whether this appointment remains appropriate or should be put out to tender and considers the Remuneration Consultants Group Code of
Conduct when considering this.

Consideration by the Directors of matters relating to Directors’ remuneration
Committee responsibilities and composition
BBGI’s Remuneration Committee comprises four members including Howard Myles, Sarah Whitney, Jutta af Rosenborg and Chris Waples. The
Chair of the Remuneration Committee, Howard Myles, will step down at the conclusion of the 2022 AGM. The intention is that Andrew Sykes will
take his place as Remuneration Committee Chair. The Terms of Reference for the Remuneration Committee are available here www.bb-gi.com/
investors/policies/remuneration-committee-terms-of-reference/

The Committee is responsible for ensuring that the remuneration of the Management supports the delivery of BBGI’s strategic and operational
goals without encouraging undesirable risk-taking behaviour. This is achieved through the Committee overseeing and approving all aspects of
Management Board remuneration, including development of the remuneration policy, and monitoring pay arrangements for the wider workforce.

There were four scheduled Committee meetings plus further ad-hoc meetings during the year. During the year, all members of the Committee
were and remain independent, and represent a broad range of backgrounds and experience to provide balance and diversity.

The following parties may attend Committee meetings by invitation during the year in relation to its consideration of matters relating to Directors’
remuneration: Co-CEOs, CFO, Company Secretary and Deloitte LLP. No Management Board member is involved in deciding their own
remuneration outcome and no attendee is present when their own remuneration is being discussed.

Remuneration and AIFM law
In 2013, the European Securities and Markets Authority (‘ESMA’) published its final guidelines on sound remuneration policies under the
AIFMD. These guidelines indicate that remuneration disclosures may be made on a ‘proportional’ basis and acknowledge that the application of
proportionality may lead exceptionally to the ‘disapplication’ of some requirements, provided this is reconcilable with the risk profile, risk appetite
and strategy of the AIFM and the AIFs it manages. According to the Guidelines, the different risk profiles and characteristics among AIFMs justify a
proportionate implementation of the remuneration principles and, where a company chooses to disapply requirements, it must be able to explain
the rationale to a competent authority. No such requirements were disapplied by the Company during or in respect of 2021.

Employee remuneration
At BBGI, we provide development opportunities for our employees to build their careers and enhance their skills. We encourage and embrace
employee diversity, equality and inclusion. We support and invest in individuals to achieve their potential across the business.

Each of the remuneration components are combined to ensure an appropriate and balanced remuneration package that reflects the business
units, job grade within the Company and professional activity, as well as market practice.

BBGI Global Infrastructure S.A. | Annual Report 2021

Remuneration at a Glance continued

Statement of implementation of Directors’ Remuneration Policy for the financial year commencing 1 January 2022
Base salary
Management Board salaries were reviewed with effect from 1 May 2021 and are as follows:

Duncan Ball

Frank Schramm

Michael Denny

Co-CEO

CFO

£501k

£477k

£305k

The next expected review will be in May 2022. As previously noted, both Mr Denny and Mr Schramm receive salaries in Euro (€363,575 and
€567,652 respectively from 1 May 2021). Mr Ball receives his salary in Canadian Dollars (C$859,847 from 1 May 2021).

Annual bonus (STIP)
The maximum bonus opportunity for FY22 will remain at 150 per cent. of salary for the Co-CEOs and 150 per cent. of salary for the CFO. The target
opportunity will be 50 per cent. of maximum. One-third of any bonus earned will be used to purchase shares to be held for a period of three years.

The annual bonus will be subject to stretching financial and strategic targets. The Committee considers the targets are commercially sensitive and
therefore they should remain confidential. However, the Committee will disclose an overview of the bonus performance measures and out-turns
retrospectively in the 2022 Directors’ Remuneration Report.

LTIP
The current intention of the Committee is to recommend the grant of ongoing annual maximum LTIP awards of 200 per cent. of salary to the Co-
CEOs and 150 per cent. of salary to the CFO, subject to stretching NAV Total Return and a climate related ESG target.

Approval
This Report was approved by the Board on 30 March 2022 and signed on its behalf by:

Howard Myles
Chair of the Remuneration Committee

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTAudit Committee Report

The following pages present the Audit Committee’s Report on how it has
discharged its duties in accordance with the 2019 AIC Code of Corporate
Governance and its activities in respect of the year ended 31 December
2021 for BBGI Global Infrastructure S.A. (the ‘Company’ or ‘BBGI’).

The Audit Committee (the “Committee”) has been in operation
throughout the year and operates within defined terms of reference,
which are available to view on the Company’s website www.bb-gi.
com/investors/policies/audit-committee-terms-of-reference. The
Committee consists of four Independent Non-Executive Directors, all
of whom sit on the Supervisory Board.

The duties of the Committee in discharging its responsibilities include
reviewing the annual and interim reports, the semi-annual valuation
of BBGI’s investment portfolio, the effectiveness of the Company’s
internal controls and risk monitoring, ensuring that the Company
maintains an effective internal audit function, reviewing the terms
of appointment, independence, objectivity and effectiveness of the
audit process by the external auditor, KPMG Luxembourg, Société
coopérative (‘KPMG’ or the ‘external auditor’).

The Committee also reviews the appropriateness of the provision of
non-audit services by the external auditor, including the cost of the
related non-audit services in accordance with the Company’s Non-
Audit Services policy.

Members of the Committee
Chris Waples was appointed as a member of the Committee with
effect from 1 May 2021. Each of the remaining three Independent
Non-Executive Directors continued to be members of the Committee
throughout the year. The Committee is chaired by me, and our
biographies can be found in the Corporate Governance section of
this Annual Report. The Supervisory Board considers that at least one
Committee member has recent and relevant financial experience for
the Committee to discharge its functions effectively. Due to the size of
the Supervisory Board, its Chair, Sarah Whitney, is also a member of the
Committee. Ms Whitney has announced her intention to step down
from the Committee following the appointment of the new Supervisory
Board members.

Responsibilities
The Committee’s terms of reference have been prepared in accordance
with the Disclosure and Transparency Rule 7.1 and the AIC Code and
are reviewed at each formal meeting scheduled by the Committee.
Any amendments recommended as a result of review are referred to
the Supervisory Board for approval. The roles and responsibilities of the
Committee, as set out in its terms of reference, are reviewed at least
annually, and consider relevant regulatory changes and recommended
best practice. There were no material amendments to the terms of
reference during the year.

The key responsibilities of the Committee include, but are not limited to:
–

To provide advice to the Supervisory Board on whether the Group’s
annual and interim reports and financial statements, taken as a
whole, are fair, balanced and understandable and provide the
information necessary for shareholders to assess the Company’s
position and performance, business model and strategy;

–

To monitor the integrity of the financial statements of the Group
and any formal announcements relating to the Group’s financial
performance, satisfy themselves that the financial statements
are compliant with relevant accounting standards and that any
significant financial reporting issues and judgements raised by the
external auditors are appropriately considered;

BBGI Global Infrastructure S.A. | Annual Report 2021

–

To review the effectiveness of the Group’s internal financial
controls and risk monitoring including consistency of accounting
policies and practices on a year-to-year basis, and, unless expressly
addressed by the Supervisory Board itself, the Group’s internal
control and risk management systems, including reviewing the
internal auditors annual regulatory report;

To monitor and review the effectiveness of the Company’s internal
audit function, including the appointment and removal of the
third-party service provider and review and approve the tri-annual
internal audit plan.

To formally report and make recommendations to the Supervisory
Board for resolutions to be put to shareholders at the AGM, to
approve the appointment, re-appointment and removal of the
external auditor, and for approval of their associated remuneration
and terms of engagement;

To review and monitor the external auditor’s independence and
objectivity and the effectiveness of the audit process, taking into
consideration relevant UK and Luxembourg professional and
regulatory requirements;

To develop and implement a policy relating to the engagement
of the external auditor for the supply of non-audit services,
considering relevant guidance and legislation regarding the
provision of non-audit services by the external audit firm; and

To review the adequacy and security of the Company’s
arrangements for its employees and contractors to raise concerns,
in confidence via BBGI’s whistle-blower hotline, about possible
wrongdoing in financial reporting, fraud, bribery and other matters.

These responsibilities form the basis of the Committee’s annual work
plan. The Committee is authorised to seek any information it requires
from the Management Board, and external parties and to investigate
issues or concerns as it deems appropriate. The Committee may also
obtain independent professional advice at the Company’s expense, in
order to perform its duties. No independent advice was required in 2021.

The external auditor is invited to attend Committee meetings at which
the annual and interim reports are considered, and at which they can
meet with the Committee without representatives of the Management
Board being present. The Committee has direct access to KPMG and
to members of the Management Board, and reports its findings and
recommendations to the Supervisory Board.

2021 in review
The Committee met formally on three occasions during the year.
Member attendance is disclosed in the Corporate Governance
section of this Annual Report, under the heading ‘Committees of the
Supervisory Board’. At these meetings, the Committee considered,
inter alia:
–

The Committee’s terms of reference;

–

The semi-annual valuation reports with respect to the Company’s
portfolio of investments;

The 2020 Annual Report and the 2021 interim report and the
appropriateness and consistency of the Company’s accounting
policies therein;

The relevance of new IFRS reporting standards to the Company:
Interest Rate Benchmark Reform – Phase 2: Amendments to IFRS 9,
IAS 39, IFRS 7, IFRS 4 and IFRS 16;

The external auditor’s terms of appointment and remuneration,
including overseeing the independence of the external auditor,
particularly in relation to the provision of non-audit services;

Audit Committee Report continued

–

The effectiveness of the audit and approval of the external auditor’s
plan for the financial year and the key business risks relevant to
the audit;

The external auditor’s reports to the Committee;

The oversight of a formal market tender process in accordance with
the mandatory external audit firm rotation requirements per EU
audit legislation as transposed into National law as described below;

The non-financial impact of COVID-19 and in particular the
effectiveness of the Company’s business continuity plan and the
controls in place to mitigate the increased risk of cyber-attack;

The Company’s overall Risk Profile and Key Risk Indicators and the
effectiveness of the Company’s risk monitoring; and

The Internal Auditors effectiveness, the 2020 internal auditor’s annual
regulatory report and the 2021-2023 triennial internal audit plan.

Valuation of Investments
During the year, the Committee discussed and debated a range of
topics with each of the Management Board, the external auditor and the
internal auditor. Consistent with prior reporting periods, the Committee
concluded that the most significant risk of material misstatement in
the Company’s financial statements relates to the valuation of the
underlying investments.

The Company’s portfolio valuation makes up 97 per cent. of the
Company’s NAV as at 31 December 2021. The valuation of the
underlying investments, including NAV sensitivity analyses, is carried
out semi-annually by the Management Board. These semi-annual
valuations are reviewed by an independent third-party valuation expert.

The Management Board members were available during the Committee
review process in order to respond to challenge and to provide detailed
explanations of the rationale used for the valuation of investments and
the assumptions, judgements and methodology applied.

The external auditor was invited to attend the Committee meetings at
which the annual and interim financial statements were considered in
order to present the conclusion of its work and to discuss the results
of the external auditor’s audit and review procedures. The external
auditor, including the external auditor’s valuation specialist provided a
review of the adequacy of the valuation of the underlying investments,
paying particular attention to the discount rates applied and the key
assumptions used in deriving the fair valuation of the investments.

Furthermore, the external auditor briefed the Committee on the outcome
of their controls testing and the audit procedures performed. This risk
of material misstatement is carefully considered when the Committee
reviews the Company’s annual and interim financial statements.

Subsequent to the valuation and ensuing reviews, the Committee
concluded that the valuation process of the Company’s investments for
the year ended 31 December 2021 had been carried out appropriately
and the value of investments was reasonable.

Audit Tender
In accordance with the mandatory external audit firm rotation
requirements per EU audit legislation as transposed into National law,
the Committee initiated a formal tender process for the Company’s
external audit function in Q4 2020. A number of audit firms were
approached to tender, and formal tender proposals were received from
participating firms in early 2021. Meetings with representatives of the
Committee and the Management Board took place in May 2021 where
the audit firms presented their proposals. Certain key criteria were
deliberated by the Committee in reaching its tender decision including,
but not limited to: the quality of the proposal and level of engagement,
relevant experience with the audit of infrastructure and fair market
valuation, audit approach, audit team credentials, potential for added
value, and fees. Following the completion of the selection process,
PricewaterhouseCoopers, société cooperative (‘PwC’), was selected as
the preferred firm. Subject to shareholder approval at the Company’s
AGM in April 2022, PwC will assume the role of the Company’s external
auditor for the financial year beginning 1 January 2022.

The Company’s current statutory auditors, KPMG Luxembourg, société
cooperative, will complete the audit for the 2021 financial year. A
detailed transition plan has been agreed, with all parties working closely
to ensure an efficient and successful transition.

I would like to thank KPMG for its significant contribution and service as
statutory auditor since the inception of the Company.

The Tender process was overseen by the Committee with consultation
from the Management Board.

External Auditor Independence
The Committee is satisfied that it has acted in accordance with its
terms of reference and that the audit process carried out by the
external auditor continues to be independent, objective and effective.
Furthermore, the Committee assessed the independence of PwC prior
to making a recommendation to the Supervisory Board to approve their
appointment as external auditor of the Company.

Non-Audit Services
The Committee considered the extent of non-audit services provided
by the external auditor. To the extent that non-audit services are
not prohibited, the Committee will continue to review and, where
appropriate, approve non-audit service engagements performed by
the external auditor or its successor on controlled subsidiaries. As a
general principle, the Company will not look to retain the services of
the external auditor or its successor for non-audit services unless there
is a specific justification for doing so, for example, legacy knowledge
whereby the appointment of another adviser would potentially be sub-
optimal to the business.

There were no non-audit services provided to the Company by the
external auditor during 2021.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTFocus for 2022
A key area of focus for the Committee during 2022 will be to ensure
that the transition from KPMG to PwC is smooth and efficient. The
Committee has scheduled meetings with the succeeding external
auditor to discuss and agree the nature and scope of the audit, with
a particular emphasis on the audit of the portfolio investment value,
due to its significance to the Company’s NAV, for the purpose of
safeguarding the integrity of the Company’s financial statements.

While the Company’s business model has proven to be robust in the
face of the COVID-19 pandemic, we will continue to monitor closely
the effectiveness of the Company’s business continuity plan and the
controls in place to mitigate potential risks, including the risk of cyber
threat, will remain a specific area of focus for the Committee.

The Committee will continue to evaluate the impact of political, tax and
regulatory developments in its applicable geographies.

I, or any member of the Committee, will continue to be available at each
AGM to respond to any questions from shareholders regarding our
activities.

Approval
This Report was approved by the Board on 30 March 2022 and signed
on its behalf by:

Jutta af Rosenborg
Chair of the Committee

Audit Committee Report continued

Internal Controls
The Committee monitors the Group’s internal control systems. The
internal controls consist of three main pillars: risk management,
compliance and internal audit.

– Risk Management: The Committee members attended the

presentation of the annual risk report and the semi-annual risk
report presented by BBGI’s Risk Manager. During these meetings
the Committee members had the opportunity to challenge the
Risk Manager and members of the Management Board enabling an
appropriate level of direct oversight. Additionally, the Committee
reviews the regular updates of the risk profile and related key risk
indicators during the year, prepared by the Risk Manager.

– Compliance: The Committee members received and considered

the quarterly compliance reports prepared by BBGI’s Compliance
Manager, describing the work performed by the compliance
function, and covering all compliance topics, including AML/
CTF, data protection, fraud, cyber security, delegate oversight,
implementation and update of policies, ESG and personal
transactions. Management Board members and other
representatives were available to respond to the Committee
members’ queries and requests for further clarification.

–

Internal Audit: As described in the responsibilities section above,
the Committee undertook a review of the internal auditor’s
effectiveness, the 2020 internal auditor’s annual regulatory
report and the 2021-2023 triennial internal audit plan, including a
presentation to the Committee by the external firm providing the
internal audit service.

The Committee considers the implementation of the three lines of
defence when assessing the effectiveness of the internal control
systems. The first line of defence, management controls, is monitored
on an ongoing basis, by the compliance and risk management
functions, which themselves make up the second line of defence. The
third line of defence is the internal audit function. Members of the
Committee are presented with sufficient information to monitor the
effectiveness of all three of those functions.

Regulatory Environment
The Committee have been kept informed of regulatory changes
during the year, including changes in scope or interpretation by the
regulator, and potential developments anticipated for the future. This
is achieved by means of the Regulatory Watch maintained by the
Compliance Function and included in regular compliance reporting to
the Committee members

BBGI Global Infrastructure S.A. | Annual Report 2021

Viability Statement

As part of their ongoing process of monitoring risk, and as required
by the AIC Code Principle N and Provision 36, the Directors have
considered the viability and prospects of the Company for the next
five years.

Whilst the average remaining life of the portfolio of assets is 20.3 years,
we continue to consider that five years is an appropriate and acceptable
length of time in which to consider the risks of the Company continuing
in existence. In making this judgement, the Directors have considered
detailed information provided at Board meetings, including:

–

The Company’s investment policy and the investment pipeline.

The long-term and contractual nature of the Company’s
investments.

Investment reviews.

The Company’s risk profile and key risk indicators (including the
principal risks and uncertainties).

– Current relevant financial and economic information.

–

Long-term economic assumptions.

Scenario testing.

– Annual and semi-annual valuations.

This judgement forms part of the overall annual risk review process
carried out by the Company. Each of the principal risks and
uncertainties the Company faces, along with detailed descriptions of
the areas and factors of the risks as well as explanations of the processes
by which the Management Board monitors, reviews and assess them,
can be found in the Risk section of this Annual Report.

The Company has put in place a robust risk and internal controls
framework with the objectives of reducing the likelihood and impact of
poor decision-making, risk-taking above agreed levels, and human error.

The Management Board regularly review and assess the principal risks
facing the Company including and in particular those that could threaten
its business model, strategy, solvency, liquidity and future performance.
All risks identified are assessed based on (i) probability or likelihood of
occurrence, (ii) impact and (iii) mitigation measures in place. They are
then scored and ranked in accordance with remaining residual risk and
monitored on an ongoing basis by the Management Board.

In addition to the risk management and the mitigation measures in
place, a valuation of each individual asset is carried out every six months
at each of the Company’s financial half-year and year-ends (30 June
and 31 December, respectively). Such valuations are based on long-
term discounted future cash flows that are themselves predominantly
based on long-term contracts and other assumptions which together
form a key part of the overall viability assessment. Once complete, each
portfolio valuation is reviewed by an independent third-party valuer and
is also subject to audit/review by the Company’s External Auditor.

A key part of the viability assessment is analysing how the Company’s
NAV will be impacted in stressed macro-economic scenarios. This
provides further insight into how the Company is likely to perform
when affected by variables and events that are inherently outside of the
control of the Management Board and its risk management framework.
As part of this assessment, the Management Board continues to
consider the risk posed by COVID-19 and the impact it could have
on the Company and the performance of its underlying investment
portfolio. To date, the Company has not experienced any material
COVID-19 related operational or financial impact.

A more detailed description of the valuations, assumptions and stress-
testing applied can be found in the Valuation section of the Strategic
Report.

Following the assessment, the Board has a reasonable expectation that
the Company will be able to continue in operation and meet all of its
liabilities as they fall due, up to March 2027. This assessment is subject
to the following conditions: that the availability of sufficient capital and
market liquidity continues to allow for the refinancing/repayment of
any short-term recourse RCF obligations which may be due; and that
the Company’s investments are not materially affected by retrospective
changes to government policy, laws, regulations or other risks which are
currently not considered material or probable by the Company.

The Company is also subject to a biennial shareholder continuation
vote, the next of which is scheduled to take place at the AGM of
shareholders scheduled to be held in 2023.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRisk

The Company follows a risk-based approach to internal controls. The Company’s Risk Management Function facilitates the Management Board’s
duty to effectively govern and manage risks facing the Company. Given the nature of its assets and its interaction with the capital markets, the
Company does not operate in a risk-free environment. In an uncertain environment, proactive action is required to address risks to achieve
business and investment objectives.

All material risks are identified, analysed, assessed, reported, and managed. Risks to the Company are identified as early as possible to minimise their
impact and are classified according to the following risk types:

–

Economic and market risk;

Taxation risk;

Political risk;

Financial risk;

– Operational risk; and

–

Strategic risk.

All identified risks are analysed during the risk reporting process to identify the range of possible impacts on the Company. A review is undertaken
to determine which risks are the material risks to pursue and respond to, and which risks require no further attention. This gives the Management
Board a universal interpretation of risk. The Risk Management Function performs a risk assessment to determine the likelihood that a predefined
event will occur and the impact it would have. This includes an estimation of the levels of risks involved in a particular situation, their comparison
against benchmarks or standards, and determination of an acceptable level of risk.

The Risk Profile is designed to assess material risks. For the material risks identified, the Company’s Risk Manager advises on the key risk indicators
to be included in the Risk Profile and suggests appropriate quantitative and qualitative limits to mitigate the potential impact of those risks, which
are discussed and approved by the Management Board before being formally included in the Risk Profile.

The inherent risk has been assessed and relevant mitigating factors been applied, to arrive at a remaining residual risk, which has been deemed
manageable and acceptable by the Management Board.

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BBGI Global Infrastructure S.A. | Annual Report 2021

Risk continued

ECONOMIC AND MARKET RISKS

Risk description

Risk mitigation

Foreign Exchange

A significant proportion of the Company’s underlying
investments – 67 per cent. of portfolio value at 31 December
2021 - are denominated in currencies other than Sterling.
The Company maintains its financial statements, prepares
the valuation, and pays dividends in Sterling.

There is a risk that fluctuations in exchange rates between
Sterling and the relevant local currencies will adversely
affect the value of the Company’s underlying investments,
the distributions and the ultimate rate of return realised by
investors.

Interest and
deposit rates

Inflation

The Company’s performance may be adversely affected by
changes in interest rates. BBGI has an exposure to interest
rates through borrowings under the RCF, debt at the
Portfolio Company level and cash deposits.

The Portfolio Companies typically have some cash reserves
and deposits. From a financial modelling perspective, an
assumption is made that the deposits can be placed at a
forecast rate that varies depending on country and historical
long-term averages. The effect on investment returns if
deposit rates exceed or fall below the projections for this
long-term rate is also dependent on the amount of deposits.

The Company has observed inflationary pressure across all
jurisdictions in which it invests. The Company’s performance
may be adversely or positively affected by lower or higher
than expected inflation, and prolonged periods of deflation
could result in defaults under loan arrangements.

The revenues and expenditure of Portfolio Companies
developed under availability-based schemes are often
partly or wholly subject to indexation. From a financial
modelling perspective, an assumption is usually made that
inflation will increase at an assumed rate (which may vary
depending on country). The effect on investment returns if
inflation exceeds or falls below the projections for this rate
is typically dependent on the extent to which the Portfolio
Company’s costs are affected by inflation and any unitary
charge indexation provisions agreed with the client on any
investment.

Currency-hedging arrangements in respect of the non-Sterling portfolio distributions
denominated in Australian Dollars, Canadian Dollars, Norwegian Kroner and US
Dollars are in place for a rolling period of four years to mitigate some of this risk.

In addition to cash flow hedging, our strategy is also to hedge a portion of the non-
Sterling, non-Euro portfolio to reduce NAV sensitivity to approximately 3 per cent. for
a 10 per cent. adverse foreign exchange movement.

Euro-denominated fund running costs provide a natural hedge against the Euro-
denominated portfolio distributions.

Furthermore, the ability to draw on the RCF in the currency of the underlying asset
distributions provides an additional hedging possibility.

BBGI has investments in five currencies other than Sterling, so there is some natural
diversification amongst the underlying currencies.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report in
relation to foreign exchange rates.

The Portfolio Companies have sought to hedge substantially all of their floating rate
interest liabilities against changes in underlying interest rates with interest rate swaps.

At the Group level, BBGI maintains deposits at low levels with the Company only
raising capital when there is a clear strategy for the deployment of proceeds.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report in
relation to deposit rates of the Portfolio Companies.

Portfolio Companies typically mitigate this risk to some extent by seeking to match
the indexation of the revenues to the indexation of the operational cost.

The Company and the service providers for the underlying Portfolio Companies
continually monitor any potential or actual changes.

Also, it is important to note BBGI’s equity cash flows are positively correlated to
inflation at c. 0.44. This means that if long-term inflation was to be 1% higher than the
Company’s assumptions for all future periods, the Company’s returns would increase
by c. 0.44%.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report in
relation to inflation rates of the Portfolio Companies.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRisk continued

ECONOMIC AND MARKET RISKS CONTINUED

Risk description

Risk mitigation

Volatility of
discount rates

The Company uses a discounted cash flow methodology to
value its portfolio of investments. Higher discount rates may
have a negative impact on valuation while lower discount
rates may have a positive impact.

Discount rates applied to the Company’s portfolio of
investments is the single most important judgement and
variable used. Appropriate discount rates are therefore key
to deriving a fair and reasonable valuation for the portfolio.

COVID-19

Since the outbreak of COVID-19 in December 2019,
there has been materially increased market volatility and
macroeconomic uncertainty, prompting several monetary
and fiscal policy interventions to manage what has become
a severe global economic shock. Over the reporting
period, government stimulus has managed for a decline
in unemployment rates and the vaccination programme
in the markets in which the Company invests – whilst not
universal in coverage rates – has sought to maintain access
to the facilities which the Company’s Portfolio Companies
maintain.

The ultimate long-term impact of COVID-19 remains
unclear.

In infrastructure, which relies on demand-based usage,
operators of these assets have experienced prolonged
shutdown or material reduction of such services (for
example, inter alia, rail links and toll roads). The Company
has no exposure to such asset types.

BBGI uses a market-based evaluation to determine a base discount rate for
steady-state, operational availability-based investments and the Company uses
its judgement in arriving at the appropriate discount rates. Adjustments may then
be applied to the base rate to reflect variances from the average benchmark when
determining the investment-specific adjustments. Changes in market rates of interest
(particularly government bond yields) may impact the discount rate used to value the
Company’s future projected cash flows and thus its valuation. The NAV is sensitivity
tested periodically for changes in discount rates.

Interest and inflation rates are positively correlated over the long term. Therefore, an
increase in discount rates due to increased interest rates over the long term is likely
to coincide with higher inflation rates. These two rates partly offset one another in the
portfolio valuation calculation.

An interest rate increase would also have a positive impact on cash deposit interest
income for portfolio companies. This would additionally mitigate a portfolio value
reduction arising from increased discount rates.

It does not necessarily follow that an increase in long-dated government bond yields
would immediately result in an increase in discount rates. As long-dated government
bond yields have largely trended downwards since BBGI’s launch in 2011, the market
discount rate applied to secondary transactions has not followed in lockstep. The
resulting increase in equity risk premium provides a degree of buffer to absorb
potential long-term increases in government bond yields and should consequently
reduce the impact on the overall discount rate.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report in
relation to discount rates of the Portfolio Companies.

The Company’s portfolio is more than 99.5 per cent. operational and relies on
availability-based revenues. At the time of producing this Annual Report, there
was no evidence to suggest material disruption to the Company and financial
performance is not expected to be materially affected.

However, there is naturally some remaining uncertainty around how the pandemic will
evolve further and therefore it is difficult to foresee all consequences or disruptions
potentially arising from the pandemic.

The timing of potential equity issuances may be impacted, but this will not likely
restrict the Company’s access to capital in the medium-term. The Group has a five-
year £230 million RCF, with a further £70 million incremental uncommitted accordion
tranche. As at 31 December 2021, the Group had utilised £1.2 million of the facility.

TAXATION RISKS

Risk description

Risk mitigation

Changes to tax
legislation, treaties
and rates

There is a continued risk that enacted changes in tax law,
tax rates and global tax initiatives including the OECD’s
recommendation in relation to Base Erosion and Profit
Shifting could have an adverse effect on the Group’s cash
flows thereby reducing the returns to investors.

Certain risks, such as changes to corporation tax rates (including due to fiscal
constraints), cannot be prevented or mitigated. BBGI values its Portfolio Companies
based on enacted tax rates. Management works closely with the Group’s global tax
advisers and are briefed periodically on relevant tax developments. A change in
the UK corporate tax rate resulting in a portfolio value decrease of £8.9 million was
reflected in the 30 June 2021 valuation. BBGI has a globally diversified portfolio of
assets, thereby reducing the tax concentration risk of any one country.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report.

BBGI Global Infrastructure S.A. | Annual Report 2021

Risk continued

POLITICAL RISKS

Change in law/
regulation

Risk description

Risk mitigation

Different laws and regulations apply within the countries
where the Company and the Portfolio Companies are
located. There is a risk that changes in laws may have
an adverse effect on the performance of the underlying
investment that in turn will affect the cash flows derived
from the investments and/or the valuation of the
investments.

In 2017, the FCA announced that the underlying markets
from which the London Interbank Offered Rate (‘LIBOR’)
is derived were no longer considered appropriate to offer a
sustainable interest rate benchmark, and determined that
this benchmark would be discontinued on 31 December
2021 replaced with the Sterling Overnight Index Average
(‘SONIA’).

The Management Board seeks regular briefings from its legal and tax advisers to stay
abreast of impending or possible changes in law.

Change in law provisions are included in some contracts, thus providing further
mitigation.

BBGI has a globally diversified portfolio of assets, thereby reducing the Group’s
exposure to changes in any one country.

Within the BBGI portfolio there are 16 investments that have LIBOR exposure. As of
the date of publishing this report the Company made significant progress and, with
the exception of four investments, all remaining investments have transitioned to
SONIA or are awaiting client consent. The remaining four investments are scheduled
to transition in the near term and we do not expect any material risk to arise.

Brexit

The Company is incorporated in Luxembourg and is listed
on the London Stock Exchange.

The UK’s departure from the EU does poses a risk to
performance of the wider UK economy, which may
adversely impact the performance of certain infrastructure
asset classes.

The UK Temporary Permissions Regime

The Company continued to access the UK market under the UK government
established TPR. As previously reported this TPR was for a limited period of time,
after which the Company would have to provide notification under the UK’s National
Private Placement Regime (‚NPPR‘) in order to continue to market the Company in
the UK.

In Q2 2021, BBGI received confirmation from the FCA of its ‘Landing Slot’ during
which BBGI was required to submit a notification under the NPPR in order to
continue to market BBGI to professional investors in the UK. In August 2021, BBGI
provided the necessary written notification to the FCA in advance of the 1 November
2021 deadline.

Regarding portfolio performance, while the long-term economic outcome of the
UK’s departure from the EU will remain uncertain for some time, BBGI’s portfolio
cash flows are contracted and, unlike demand-based assets, are not sensitive to the
performance of the wider economic environment.

Voluntary
Termination Risk

There remains a risk that public sector clients of portfolio
companies choose to exercise their right to voluntarily
terminate the contracts. In case of such a voluntary
termination, the public sector is typically contractually
obliged to pay compensation amounts on termination
to both the equity holders and the debt providers and -
depending on the circumstances - to other parties. While
the provisions vary between contracts, they generally
ensure that the investor is paid either market value for the
equity interests or a value to achieve the originally projected
IRR, and in these cases, where the compensation amount is
less than current valuation levels, the Company could suffer
a material loss.

We remain unconvinced by the practicalities of terminating the contracts given the
complexities involved and the overall compensation that would currently be required
to terminate these contracts. The Management Board believes there are several
mitigants or deterrents to the risk of voluntary termination of contracts.

Most transactions were agreed at a time when interest rates were significantly
higher than currently. As interest rates have fallen, and even with the prospect of a
modest rise in interest rates, swaps have become ‘out of the money’ for the Portfolio
Companies, so any public body wishing to terminate a contract in the current interest
environment it would need to cover the cost of the swap breakage fee.

The Portfolio Company equity investors would typically also need to be compensated,
often requiring a compensation payment, as well as the public sector being required
to budget for the ongoing provision of the service.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRisk continued

FINANCIAL RISKS

Risk description

Risk mitigation

Valuation

The most significant risk of material misstatement in the
Company’s financial statements continues to be the fair
valuation of the investment portfolio, the discount rates
applied and the key assumptions when valuing these
investments.

There is a risk that errors may be made in the assumptions,
calculations or methodology used in a periodic valuation
process.

Financial models, either for the Group or the underlying
Portfolio Companies, may contain errors, or incorrect inputs,
resulting in inaccurate projections of the distributions.
These could adversely impact the valuation on individual
investments and the overall assessment of the Company’s
financial position.

The Company’s portfolio value is prepared semi-annually by an experienced internal
team, overseen by the Management Board. The valuation is then independently
reviewed by an independent, third-party valuer, and is also reviewed and audited by
the Company’s auditor.

All key assumptions used in the valuation process are subject to sensitivity testing.
However, sensitivity testing has its limitations. It cannot provide a comprehensive
assessment of all of the risks and should be treated accordingly.

Poor investment
selection

There is a risk that errors may be made in the assumptions,
calculations or methodology during the acquisition due
diligence process. In such circumstances, the figures and/
or the returns generated by the Portfolio Company may be
lower than those estimated or projected.

BBGI has developed a robust asset acquisition due diligence process. Typical due
diligence includes model review, legal, tax, technical, ESG, anti-money laundering
and insurance reviews.

The due diligence process includes an ESG and sustainability risk analysis.

OPERATIONAL RISKS

Risk description

Risk mitigation

Construction
defects

The risk of certain key operational costs in relation to
construction defects lies with the Portfolio Company.

Lifecycle risk/
Operational cost

During the life of an investment, components of the
assets (such as asphalt or concrete in the case of roads
and elevators, or roofs and air handling plants in the case
of buildings) are likely to need to be replaced or undergo
a major refurbishment. There is a risk that the actual cost
of replacement or refurbishment will be greater than the
forecast cost or the timing of the intervention may be earlier
than forecast.

There is the general risk that costs are higher than budgeted.
This typically relates to insurance costs and management
service contracts.

In general, Portfolio Companies can submit claims against construction
subcontractors when it comes to defects in the design, construction or
commissioning of project assets. This right to claim applies for a pre-determined
period of time following the completion of construction (the ‘statutory limitations
period’) and this may differ between jurisdictions. If disputes were to arise, an
arbitration or court process may be used. At the point that the statutory limitations
period has ended, the risk of remediation of construction defects which are identified
after this point typically falls to the Portfolio Company itself and is the risk of the
Portfolio Company. In addition, there may be other situations, for example where a
subcontractor becomes insolvent, and may no longer be able to fulfil its obligations to
correct these defects.

Of the 54 assets in the BBGI portfolio at 31 December 2021, 19 Portfolio Companies
retain the lifecycle obligations. The remaining 35 assets have this obligation passed
down to the subcontractor.

The timing and costs of such replacements or refurbishments is forecasted, modelled
and provided for by each Portfolio Company based upon internal or external
technical advice to assist in such forecasting of lifecycle timings, scope of work and
costs.

As part of the acquisition due diligence, the budgeted costs are reviewed and an
assessment is made as to its adequacy.

A sensitivity analysis is provided in the valuation section of the 2021 Annual Report in
relation to life-cycle costs.

In the case of insurance cost, this risk is on part of investments taken by the public
sector or mitigated by a contractual premium risk-sharing mechanism.

BBGI Global Infrastructure S.A. | Annual Report 2021

Risk continued

OPERATIONAL RISKS CONTINUED

Risk descrition

Risk mitigation

Subcontractor
performance
or credit risk
(construction
contractors,
facility managers,
operation and
maintenance
contractors)

The risk of a subcontractor service failure, poor performance
or subcontractor insolvency which is sufficiently serious to
cause a Portfolio Company to terminate or to be required
by the client to terminate a subcontract. There may be a
loss of revenue during the time taken to find a replacement
subcontractor. Furthermore, the replacement subcontractor
may levy a surcharge to assume the subcontract or charge
more to provide the services.

For assets under construction, there are a number of mitigants and steps taken to
manage this risk:

In the case of a construction joint venture consisting of two or more counterparties,
these are typically jointly and severally liable, meaning if one party fails, the other is
obligated to take over the obligations.

A contractor replacement analysis is performed as part of the initial investment due
diligence.

Cyber-security

A breach of data security could occur by accident or
as a result of an external cyber-attack. A cyber-attack
could affect the IT systems of BBGI or a portfolio
company, causing theft or loss of data, or damage to the
infrastructure’s control systems and equipment.

The threat of cyber-attack has meant that businesses can no
longer afford to be reactive. A cyber-attack could not only
affect BBGI’s reputation but could also affect the Group
legally, financially and operationally.

The construction subcontractors are typically required by lenders to provide a robust
security package often consisting of letters of credit, parent company guarantees and
performance bonding.

The latter two mitigants are also in place for investments once they become
operational. Other mitigants during operations include:

Periodic benchmarking of defined facility services on some investments.

Diversified group of subcontractors with no substantial concentration risk.

There is an ongoing subcontractor monitoring in place.

BBGI has taken several measures to reduce the risk of a cyber-attack, some of which
are outlined below.

The Company has outsourced the hosting of its IT platform to an industry specialist.
In doing so, BBGI obtains the benefit of having access to IT security experts, with the
platform being monitored by an advanced IT security system, something that might
not be cost effective if the Company’s IT infrastructure was maintained onsite.

BBGI engages an external expert to carry out an annual intrusion test on the IT
platform in order to identify and patch any vulnerabilities that might be identified.

Business continuity tests are performed regularly, disaster recovery tests are
performed annually, and staff periodically undergo cyber security training.

In a typical PPP structure, the public sector client has its own IT systems; the
vast majority of our Portfolio Companies do not maintain their own IT systems.
Subcontractors of the Portfolio Company such as management service providers,
facility maintenance contractors for accommodation investments and operations and
maintenance contractors for transport assets, will have their own IT systems, which
will likely house data relating to the project. In a typical PPP structure, risks are passed
down to subcontractors by the project entity. This would include risks relating to
design and construction warranties relating to IT systems (such as a warranty that the
system will meet specifications requiring it to meet robust security requirements), as
well as the risk where a cyber-attack would interrupt the provision of services to the
project.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTRisk continued

STRATEGIC RISKS

Risk description

Risk mitigation

Premium/discount
to NAV

The risk of share price volatility or trading at a discount to
NAV leading to shareholder dissatisfaction.

Access to capital

Sustainability Risk

There is a risk that a disruption to the equity markets could
lead to an inability to raise new capital. Such a disruption
could limit the Company’s ability to grow and its ability to
repay debt drawn under its RCF. To the extent that the
Company does not have cash reserves pending investment,
the Company expects to bridge finance further investments
by way of the credit facility. Although the Company has
had a credit facility in place since July 2012 (which was
subsequently refinanced), there can be no guarantee that
this will always be the case or that it will be able to issue
further shares in the market.

Sustainability risks has been defined in Article 2(22) of
the Sustainable Financial Disclosure Regulation as “an
environmental, social or governance event or condition
that, if it occurs, could cause an actual or potential
material negative impact on the value of the investment”.
For example, climate change can give rise to a range of
sustainability risks. Financial risks from climate change
can arise through two primary channels: (i) physical risk
from abrupt and acute weather events or chronic longer-
term shifts in climate patterns, each causing disruptions
to businesses and economic activities (and the value of
investments in them) and (ii) transition risk from a shift to low
carbon and climate resilient policies, laws and technologies
and changes in societal attitudes. Failure to acknowledge
climate change may also alienate certain investors and
reduce access to capital.

Similarly, infringements of human rights can have a
significant impact on the financial performance of an
investment. All of these factors can have a material negative
impact on investment returns.

To assist the Company in managing any share price premiums or discounts to NAV,
the Company has the ability to make market purchases of up to 14.99 per cent. per
annum of the ordinary shares in issue.

In addition, a continuation vote is offered to shareholders every two years, the next of
which will be proposed at the Company’s AGM on 30 April 2023.

Furthermore, the Management Board meets regularly with shareholders and receives
regular briefings from the Company’s brokers to manage investor relations.

The need to issue new equity capital primarily relates to the repayment of drawings
under the RCF.

The Board and its Corporate Brokers regularly assess market sentiment.

Furthermore, the Board can consider refinancing the RCF to extend its maturity and
reduce the near-term requirement to repay drawings, though it is not the Company’s
intention to be drawn for substantial periods of time.

The Company’s RCF expires in May 2026.

BBGI seeks to integrate and appraise material sustainability risks in our processes in
a number of ways. This means that, alongside more traditional financial criteria, we
systematically consider whether – and to what extent – financially material ESG risks
might meaningfully impact our investments.

BBGI has undertaken a formal climate risk assessment for its entire portfolio to better
understand the impact of climate risk on our Company. Findings demonstrate a high
degree of climate resilience across our asset portfolio both today and under different
climate warming scenarios. Although climate change is projected to increase physical
risk impacts across our portfolio, many of our assets, due to the vital services they
provide, have been designed and constructed in consideration of potential physical
risk impacts and thus are inherently more resilient to climate change.

Events arising from adverse climate change is typically mitigated through insurance
coverage, pass-down to subcontractors and public sector client relief events.
However, in severe cases, adverse climate change events could lead to early
termination of concession agreements and compensation payments which are lower
than the valuation.

BBGI Global Infrastructure S.A. | Annual Report 2021

Administration

Incorporation and administration
The ordinary shares were created in accordance with Luxembourg law
and conform to the regulations made thereunder, have all necessary
statutory and other consents, and are duly authorised according to, and
operate in conformity with, the Articles.

Articles of Association
The Articles were originally approved and formalised before a
Luxembourg notary public on 24 November 2011. The Articles are filed
with the Luxembourg Registre de Commerce et des Sociétés and are
published in the Mémorial. The Articles may be amended in accordance
with the rules set out in article 32 of the Articles.

A copy of the current Articles, which were most recently amended by
shareholder approval on 30 November 2020, is available for inspection
on the Company’s website www.bb-gi.com/investors/policies/articles-
of-association/.

BBGI Global Infrastructure S.A. | Annual Report 2021

FINANCIAL STATEMENTSCOMPANY OVERVIEWCORPORATE GOVERNANCESTRATEGIC REPORTManagement Board Responsibilities Statement

The Management Board of the Company is responsible for ensuring proper preparation of the Company’s Annual and Interim Reports and
financial statements for each financial period in accordance with applicable laws and regulations, which require it to:

Give a true and fair view of the assets, liabilities, financial position and profit or loss of the Group as of and at the end of the financial period, in
accordance with International Financial Reporting Standards as adopted by the European Union and the Listing Rules.

ii)

Give a true and fair view of the development and performance of the business and the position of the Group.

iii)

Give a true and fair description of the principal risks and uncertainties the Group may encounter and put in place an appropriate control
framework designed to meet the Group’s particular needs and the risks to which it is exposed.

In addition, the Management Board is responsible for ensuring that the Company complies with applicable company law and other UK or
Luxembourg applicable laws and regulations.

In preparing such Financial Statements, the Management Board is responsible for:

–

Selecting suitable accounting policies and applying them consistently.

– Making judgements and estimates that are reasonable and prudent.

–

Stating whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the
financial statements.

–

Preparing the financial statements on a going concern basis, unless it is inappropriate to presume that the Group will continue in business.

– Maintaining proper accounting records which disclose with reasonable accuracy the financial position of the Group and enable it to ensure that

the financial statements comply with all relevant regulations.

–

Safeguarding the assets of the Group and taking reasonable steps for the prevention and detection of fraud and other irregularities.

Management Board Responsibilities Statement

We confirm that to the best of our knowledge:

–

The financial statements have been prepared in accordance with the applicable set of accounting standards and give a true and fair view of the
assets, liabilities, financial position and profit or loss of the Company and Group included in the consolidation as a whole.

The Chair’s Statement and the Report of the Management Board (‘Strategic Report’) include a fair review of the development and performance
of the business and the position of the Company and Group included in the consolidation taken as a whole, together with a description of the
principal risks and uncertainties that it faces.

Luxembourg, 30 March 2022

Duncan Ball
Co-CEO

Frank Schramm
Co-CEO

Michael Denny
CFO

BBGI Global Infrastructure S.A. | Annual Report 2021

Report on the audit of the consolidated financial statements

To the Shareholders of
BBGI Global Infrastructure S.A.
6E, route de Treves
L-2633 Senningerberg
Luxembourg

Report of the reviseur d’entreprises agree

Opinion
We have audited the consolidated financial statements of BBGI Global Infrastructure S.A. and its subsidiaries (the “Group”), which comprise the
consolidated statement of financial position as at 31 December 2021, and the consolidated statement of comprehensive income, consolidated
statement of changes in equity and consolidated statement of cash flows for the year then ended, and notes to the consolidated financial
statements, including a summary of significant accounting policies.

In our opinion, the accompanying consolidated financial statements give a true and fair view of the consolidated financial position of the Group
as at 31 December 2021 and of its consolidated financial performance and its consolidated cash flows for the year then ended in accordance with
International Financial Reporting Standards as adopted by the European Union (“IFRSs”).

Basis for opinion
We conducted our audit in accordance with the Law of 23 July 2016 on the audit profession (“Law of 23 July 2016”) and with International Standards
on Auditing (“ISAs”) as adopted for Luxembourg by the “Commission de Surveillance du Secteur Financier” (“CSSF”). Our responsibilities under
the Law of 23 July 2016 and ISAs are further described in the « Responsibilities of “réviseur d’entreprises agréé” for the audit of the consolidated
financial statements » section of our report. We are also independent of the Group in accordance with the International Ethics Standards Board
for Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”) as adopted for Luxembourg by the CSSF together with the ethical
requirements that are relevant to our audit of the consolidated financial statements, and have fulfilled our other ethical responsibilities under those
ethical requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the consolidated financial
statements of the current year. These matters were addressed in the context of the audit of the consolidated financial statements as a whole, and in
forming our opinion thereon, and we do not provide a separate opinion on these matters.

Investments at fair value through profit or loss

a) Why the matter was considered to be one of most significance in our audit of the consolidated financial statements of the current period
We refer to the accounting policy “Investments at fair value through profit or loss” and to Note 9 in the consolidated financial statements. 97%
of the Group’s assets are infrastructure assets that have been developed predominantly under the PPP/PFI or similar procurement models
(“Infrastructure Investments”), held at fair value through profit or loss. The valuation of infrastructure investments is a significant judgement area
resulting from a number of assumptions in the financial models. The valuation is inherently subjective due to the absence of a liquid market for
these investments. The complexity of this methodology as well as assumptions taken in the financial models mean that there is a risk that the fair
value of these investments may not be appropriate. The key assumptions used by the Management Board are among others in respect of discount
rates and components of budgets used being part of long term forecast cash flows. In addition, the Management Board also used assumptions
such as inflation, deposit interest and tax rates that have an impact on the long term forecast cash flows.

The significance of the estimates and judgements involved, coupled with the fact that a small percentage difference in the key assumptions in
individual infrastructure investment valuations, when aggregated, could result in a material misstatement on the consolidated income statement
and consolidated statement of financial position, warrants specific audit focus in this area.

b) How the matter was addressed in our audit
Our audit procedures over the valuation of investments at fair value through profit or loss included, but were not limited to the following:

– We tested the design and implementation of the management review controls over the valuation process.

– We used our own valuation specialists and their market knowledge to perform the following procedures:

– We considered and commented the approach and methodology documented by Management Board used in BBGI’s Valuation Report

against International Private Equity and Venture Capital Valuation Guidelines;

– We obtained market benchmarks for discount rates from public and private sources. We considered the discount rates applied in BBGI’s

Valuation Report against market benchmarks in the light of market, project, sector and country issues;

– We performed research on key assumptions and commented and compared those against the assumptions applied in BBGI’s Valuation Report;

– We reviewed the results of the sensitivity analysis on key assumptions taken by Management;

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEReport on the audit of the consolidated financial statements

– We challenged and determined the appropriateness of the Management Board’s assumptions used for the valuation of a sample of

Infrastructure Investments applying the following procedures:

– We considered if the methodology for assessing fair value has been applied consistently across the assets;

– We read the latest board minutes, board packages and other supporting documents and information in respect of the sampled

investments and raised Q&A comments to challenge the inputs in the valuation;

– We determined the appropriateness of the changes in the cash-flows inputs (such as dividends, subordinated debt interest and principal

repayment and director’s fees) used for the valuation of Infrastructure Investments;

– We reviewed the Valuation Report prepared by the Management Board and assessed whether the valuation inputs and results are consistent

with our other audit procedures performed as part of our audit of the consolidated financial statements;

– We obtained and reviewed the valuation review opinion issued by the independent third-party valuation expert engaged by the Group, in

connection with the appropriateness of the portfolio value prepared by the Management board.

Other information
The Management Board is responsible for the other information. The other information comprises the information stated in the annual report but
does not include the consolidated financial statements and our report of “réviseur d’entreprises agréé” thereon.

Our opinion on the consolidated financial statements does not cover the other information and we do not express any form of assurance
conclusion thereon.

In connection with our audit of the consolidated financial statements, our responsibility is to read the other information and, in doing so, consider
whether the other information is materially inconsistent with the consolidated financial statements or our knowledge obtained in the audit or
otherwise appears to be materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report this fact. We have nothing to report in this regard.

Responsibilities of the Management Board for the consolidated financial statements
The Management Board is responsible for the preparation and fair presentation of the consolidated financial statements in accordance with IFRSs,
and for such internal control as the Management Board determines is necessary to enable the preparation of consolidated financial statements that
are free from material misstatement, whether due to fraud or error.

In preparing the consolidated financial statements, the Management Board is responsible for assessing the Group’s ability to continue as a going
concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Management
Board either intends to liquidate the Group or to cease operations, or has no realistic alternative but to do so.

Responsibilities of the réviseur d’entreprises agréé for the audit of the consolidated financial statements
The objectives of our audit are to obtain reasonable assurance about whether the consolidated financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue a report of “réviseur d’entreprises agréé” that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Law of 23 July 2016 and with ISAs as
adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these consolidated financial statements.

As part of an audit in accordance with the Law of 23 July 2016 and with ISAs as adopted for Luxembourg by the CSSF, we exercise professional
judgment and maintain professional skepticism throughout the audit. We also:
–

Identify and assess the risks of material misstatement of the consolidated financial statements, whether due to fraud or error, design and
perform audit procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our
opinion. The risk of not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve
collusion, forgery, intentional omissions, misrepresentations, or the override of internal control.

– Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances,

but not for the purpose of expressing an opinion on the effectiveness of the Group’s internal control.

–

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the
Management Board.

– Conclude on the appropriateness of the Management Board’s use of the going concern basis of accounting and, based on the audit evidence

obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Group’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report of the “réviseur
d’entreprises agréé” to the related disclosures in the consolidated financial statements or, if such disclosures are inadequate, to modify our
opinion. Our conclusions are based on the audit evidence obtained up to the date of our report of the “réviseur d’entreprises agréé”. However,
future events or conditions may cause the Group to cease to continue as a going concern.

–

Evaluate the overall presentation, structure and content of the consolidated financial statements, including the disclosures, and whether the
consolidated financial statements represent the underlying transactions and events in a manner that achieves fair presentation.

– Obtain sufficient appropriate audit evidence regarding the financial information of the entities and business activities within the Group to

express an opinion on the consolidated financial statements. We are responsible for the direction, supervision and performance of the Group
audit. We remain solely responsible for our audit opinion.

BBGI Global Infrastructure S.A. | Annual Report 2021

Report on the audit of the consolidated financial statements continued

We communicate with those charged with governance regarding, among other matters, the planned scope and timing of the audit and significant
audit findings, including any significant deficiencies in internal control that we identify during our audit.

We also provide those charged with governance with a statement that we have complied with relevant ethical requirements regarding
independence, and to communicate with them all relationships and other matters that may reasonably be thought to bear on our independence,
and where applicable, related safeguards.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit of
the consolidated financial statements of the current period and are therefore the key audit matters. We describe these matters in our report unless
law or regulation precludes public disclosure about the matter.

Report on other legal and regulatory requirements
We have been appointed as “réviseur d’entreprises agréé” by the General Meeting of the Shareholders on 30 April 2021 and the duration of our
uninterrupted engagement, including previous renewals and reappointments, is eleven years.

The annual report is consistent with the consolidated financial statements and has been prepared in accordance with applicable legal requirements.

Luxembourg, 30 March 2022
KPMG Luxembourg
Société anonyme
Cabinet de révision agréé

Joseph De Souza
Partner

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEConsolidated Income Statement

For the year ended 31 December 2021

In thousands of Pounds Sterling

Continuing operations

Income from investments at fair value through profit or loss

Other operating income

Operating income

Administrative expenses

Other operating expenses

Operating expenses

Results from operating activities

Net finance result

Net loss on balance sheet hedging

Profit before tax

Tax expense – net

Profit from continuing operations

Profit from continuing operations attributable to the owners of the Company

Earnings per share

Basic earnings per share (pence)

Diluted earnings per share (pence)

The accompanying notes form an integral part of the consolidated financial statements

Note

2021

2020

75,443

63,337

734

186

76,177

63,523

(10,234)

(2,492)

(9,607)

(7,268)

(12,726)

(16,875)

63,451

46,648

(1,974)

(782)

(1,647)

(642)

60,695

44,359

(2,698)

(2,649)

57,997

8.47

8.46

41,710

6.58

6.57

BBGI Global Infrastructure S.A. | Annual Report 2021

Consolidated Statement of Other Comprehensive Income

For the year ended 31 December 2021

In thousands of Pounds Sterling

Profit from continuing operations attributable to the owners of the Company

Other comprehensive loss for the year

Note

2021

57,997

(595)

2020

41,710

–

Total comprehensive income for the year attributable to the owners of the Company

57,402

41,710

The accompanying notes form an integral part of the consolidated financial statements

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEConsolidated Statement of Financial Position

For the year ended 31 December 2021

In thousands of Pounds Sterling

Assets

Property and equipment

Investments at fair value through profit or loss

Deferred tax assets

Derivative financial assets

Other non-current assets

Non-current assets

Trade and other receivables

Other current assets

Derivative financial assets

Cash and cash equivalents

Current assets

Total assets

Equity

Share capital

Additional paid-in capital

Translation and other capital reserves

Retained earnings

Equity attributable to the owners of the Company

Liabilities

Derivative financial liabilities

Non-current liabilities

Loans and borrowings

Trade and other payables

Derivative financial liabilities

Tax liabilities

Current liabilities

Total liabilities

Total equity and liabilities

Net asset value attributable to the owners of the Company

Net asset value per ordinary share (pence)

The accompanying notes form an integral part of the consolidated financial statements.

BBGI Global Infrastructure S.A. | Annual Report 2021

Note

2021

2020

975,225

895,674

–

1,417

225

–

976,710

895,969

1,024

761

907

26,862

29,554

1,631

2,164

247

20,532

24,574

1,006,264

920,543

847,858

770,942

1,833

(8,809)

1,517

(378)

159,661

143,759

1,000,543

915,840

429

246

2,956

717

1,373

5,292

5,721

218

177

2,716

1,567

4,485

4,703

1,006,264

920,543

1,000,543

915,840

140.50

137.78

Consolidated Statement of Changes in Equity

For the year ended 31 December 2021

In thousands of Pounds Sterling

As at 1 January 2020

Total comprehensive income for the year ended 31 December 2020

Profit from continuing operations attributable to the owners of

the Company

Total comprehensive income for year

Transactions with the owners of the Company, recognised directly

in equity

Issuance of shares from placing of ordinary shares – net of issue cost

Scrip dividends

Cash dividends

Equity settlement of share based compensation

Share-based payment

Balance as at 31 December 2020

In thousands of Pounds Sterling

Balance as at 1 January 2021

Total comprehensive income for the year ended 31 December 2021

Profit from continuing operations attributable to the owners of

the Company

Exchange difference on translation of foreign operation

Total comprehensive income for year

Transactions with the owners of the Company, recognised directly

in equity

ordinary shares – net of issue cost

Scrip dividends

Cash dividends

Equity settlement of share based compensation

Share-based payment

Balance as at 31 December 2021

Share
capital

Additional
paid-in
capital

Notes

Translation
and other
capital
reserve

Retained
earnings

Total
equity

714,280

965

(378)

146,765

861,632

–

54,169

2,068

–

425

–

770,942

13,20

–

(425)

977

1,517

–

41,710

–

54,169

(2,068)

–

(42,648)

–

977

(378)

143,759

915,840

Share
capital

Additional
paid-in
capital

Notes

Translation
and other
capital
reserve

Retained
earnings

Total
equity

770,942

1,517

(378)

143,759

915,840

–

73,893

1,978

–

1,045

(1,045)

–

1,361

13,20

–

(8,431)

57,997

7,836

57,997

(595)

(8,431)

65,833

57,402

–

73,893

(1,978)

–

(47,953)

–

1,361

847,858

1,833

(8,809)

159,661 1,000,543

The accompanying notes form an integral part of the consolidated financial statements

BBGI Global Infrastructure S.A. | Annual Report 2021

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEConsolidated Statement of Cash Flows

For the year ended 31 December 2021

In thousands of Pounds Sterling

Operating activities

Profit from continuing operations

Adjustments for:

Depreciation expense

Net finance results

Income from investments at fair value through profit or loss

Loss on derivative financial instruments – net

Foreign currency exchange loss (gain) – net

Share-based compensation

Tax expense - net

Working capital adjustments:

Trade and other receivables

Other current assets

Trade and other payables

Cash used in operating activities

Interest paid and other borrowing costs

Interest received

Realised gain on derivative financial instruments – net

Taxes paid

Net cash flows used in operating activities

Investing activities

Acquisition of/additional investments at fair value through profit or loss

Distributions received from investments at fair value through profit or loss

Realised loss on derivative financial instruments – net

Acquisition of property and equipment

Net cash flows from/(used in) investing activities

Financing activities

Issuance of share capital through placing (net of issuance cost)

Dividends paid

Repayment of loans and borrowings

Proceeds from issuance of loans and borrowings

Debt issue cost

Net cash flows from/(used in) financing activities

Net increase (decrease) in cash and cash equivalents

Impact of foreign exchange on cash and cash equivalents

Cash and cash equivalents at 1 January

Cash and cash equivalents at 31 December

The accompanying notes form an integral part of the consolidated financial statements

100

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes

2021

2020

57,997

41,710

1,974

1,647

(75,443)

(63,337)

1,797

(448)

1,361

2,698

691

1,045

214

(8,091)

(1,356)

–

(2,667)

(12,111)

1,495

4,767

977

2,649

(1,094)

(2,822)

(168)

(14,149)

(1,219)

594

(3,010)

(17,774)

(79,163)

(59,185)

75,055

72,815

(1,543)

(33)

(745)

(24)

(5,684)

12,861

73,893

54,169

(47,953)

(42,648)

(67,000)

(62,000)

67,000

41,000

(1,608)

24,332

6,537

(207)

20,532

26,862

(27)

(9,506)

(14,419)

173

34,778

20,532

Notes to the Consolidated Financial Statement

For the year ended 31 December 2021

1. Corporate information
BBGI Global Infrastructure S.A., formerly BBGI SICAV S.A.,(‘BBGI’, or the ‘Company’ or, together with its consolidated subsidiaries, the ‘Group’) is
an investment company incorporated in Luxembourg in the form of a public limited liability company (société anonyme) with variable share capital
(société d’investissement à capital variable, or ‘SICAV’) and regulated by the Commission de Surveillance du Secteur Financier (‘CSSF’) under Part
II of the amended Luxembourg law of 17 December 2010 on undertakings for collective investments with an indefinite life. The Company qualifies
as an alternative investment fund within the meaning of Article 1 (39) of the amended law of 12 July 2013 on Alternative Investment Fund Managers
(‘2013 Law’) implementing Directive 2011/61/EU of the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund
Managers and amending Directives 2003/41/EC and 2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 and is authorised
as an internal alternative investment fund manager in accordance with Chapter 2 of the 2013 Law. The Company was admitted to the official list of
the UK Listing Authority (premium listing, closed-ended investment company) and to trading on the main market of the London Stock Exchange
on 21 December 2011.

As of 1 January 2021, the main market of the London Stock Exchange is not considered as an EU regulated market (as defined by the MiFID II).
As a result, Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004, on the harmonisation of transparency
requirements in relation to information about issuers whose securities are admitted to trading on a regulated market, and amending Directive
2001/34/EC (the Transparency Directive) as implemented in the Luxembourg law by the act dated 11 January 2008 on transparency requirements
for issuers (the Transparency Act 2008), among other texts, do not apply to the Company.

The Company’s registered office is EBBC, 6E, route de Trèves, L-2633 Senningerberg, Luxembourg. On 27 October 2020, the Company changed
its registered name from BBGI SICAV S.A. to BBGI Global Infrastructure S.A.

The Company is a closed-ended investment company that invests principally in a diversified portfolio of Public Private Partnership (‘PPP’)/Private
Finance Initiative (‘PFI’) infrastructure or similar style assets. At 31 December 2021, the Group has one investment that is under construction (31
December 2020: one).

As at 31 December 2021, the Group employed 25 staff (31 December 2020: 23 staff).

Reporting period
The Company’s reporting period runs from 1 January to 31 December each year. The Company’s consolidated statement of financial position,
consolidated income statement, consolidated statement of comprehensive income, consolidated statement of changes in equity and consolidated
statement of cash flows include comparative figures as at 31 December 2020.

The amounts presented as ‘non-current’ in the consolidated statement of financial position are those expected to be recovered or settled after
more than one year. The amounts presented as ‘current’ are those expected to be recovered or settled within one year.

These consolidated financial statements were approved by the Management Board on 30 March 2022.

2. Basis of preparation

Statement of compliance
The consolidated financial statements of the Group have been prepared in accordance with International Financial Reporting Standards (‘IFRS’) as
adopted by the European Union (‘EU’).

The Group follows, to the fullest extent possible, the provisions of the Standard of Recommended Practices issued by the Association of
Investment Companies (‘AIC SORP’). If a provision of the AIC SORP is in direct conflict with IFRS as adopted by the EU, the standards of the latter
shall prevail.

The consolidated financial statements have been prepared using the going concern principle, under the historical cost basis, except for
investments at fair value through profit or loss (‘Investments at FVPL’) and derivative financial instruments that have been measured at fair value.

In the Consolidated Statement of Changes in Equity, certain amounts in Retained earnings were reclassified to ‘Translation and other capital
reserves’ as at 31 December 2020 in order to ensure comparability with the current year presentation. This reclassification had no effect on the
reported net results nor the net asset value as at 31 December 2020.

BBGI Global Infrastructure S.A. | Annual Report 2021

101

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continued

For the year ended 31 December 2021

2. Basis of preparation (continued)

Changes in accounting policy
New and amended standards applicable to the Group are as follows:

Interest Rate Benchmark Reform – Phase 2: Amendments to IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16 (effective 1 January 2021)
The amendments provide temporary reliefs which address the financial reporting effects when an interbank offered rate (IBOR) is replaced with an
alternative nearly risk-free interest rate (RFR). The amendments include the following practical expedients:

– A practical expedient to require contractual changes, or changes to cash flows that are directly required by the reform, to be treated as changes

to a floating interest rate, equivalent to a movement in a market rate of interest

– Permit changes required by IBOR reform to be made to hedge designations and hedge documentation without the hedging relationship being

discontinued

– Provide temporary relief to entities from having to meet the separately identifiable requirement when an RFR instrument is designated as a

hedge of a risk component

These amendments had no significant impact on the consolidated financial statements of the Group.

Functional and presentation currency
These consolidated financial statements are presented in Pounds Sterling, the Company’s functional currency. All amounts presented in tables
throughout the report have been rounded to the nearest thousand, unless otherwise stated.

The Company as an Investment Entity
The Management Board has assessed that the Company is an Investment Entity in accordance with the provisions of IFRS 10. The Company meets
the following criteria to qualify as an Investment Entity:

a) Obtains funds from one or more investors for the purpose of providing those investors with investment management services - The Group is

internally managed with management focused solely on managing those funds received from its shareholders in order to maximise investment
income/returns.

b) Commits to its investors that its business purpose is to invest funds solely for returns from capital appreciation, investment income, or both -

The investment objectives of the Company are to:
– Provide investors with secure and highly predictable long-term cash flows whilst actively managing the investment portfolio with the

intention of maximising return over the long-term.

– Target an annual dividend payment with the aim to increase this distribution progressively over the longer-term.

– Target an IRR which is to be achieved over the longer-term via active management and to enhance the value of existing investments.

The above-mentioned objectives support the fact that the main business purpose of the Company is to seek to maximise investment income for
the benefit of its shareholders.

c) Measures and evaluates performance of substantially all of its investments on a fair value basis - The investment policy of the Company is to

invest in equity, subordinated debt or similar interests issued in respect of infrastructure assets that have been developed predominantly under
the PPP/PFI or similar styled procurement models. Each of these assets is valued at fair value. The valuation is carried out on a six-monthly basis
as at 30 June and 31 December each year.

Based on the Management Board’s assessment, the Company also meets the typical characteristics of an Investment Entity as follows:

it has more than one investment – as at 31 December 2021, the Company has 54 investments;

it has more than one investor – the Company is listed on the London Stock Exchange with its shares held by a broad pool of investors;

it has investors that are not related parties of the entity – other than those shares held by the Supervisory Board and Management Board
Directors, and certain other employees, all remaining shares in issue (more than 99 per cent.) are held by non-related parties of the Company;
and

it has ownership interests in the form of equity or similar interests – ownership in the Company is through equity interest.

102

BBGI Global Infrastructure S.A. | Annual Report 2021

3. Summary of significant accounting policies

a) Basis of consolidation

Business combination
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is transferred
to the Group. Control is the power to direct the relevant activities, i.e. the activities that significantly affect the investee’s returns and to obtain those
returns. In assessing control, the Group takes into consideration potential voting rights that currently are exercisable.

The Group measures goodwill at the acquisition date as:

–

the fair value of the consideration transferred; plus

the recognised amount of any non-controlling interests in the acquiree; plus

if the business combination is achieved in stages, the fair value of the pre-existing equity interest in the acquiree; less

the net recognised amount (generally fair value) of the identifiable assets acquired and liabilities assumed.

When there is an excess of value over consideration, a bargain purchase gain is recognised immediately in the consolidated income statement.

The consideration transferred does not include amounts related to the settlement of pre-existing relationships. Such amounts generally are
recognised in the consolidated income statement. Transaction costs, other than those associated with the issue of debt or equity securities, that
the Group incurs in connection with a business combination are expensed as incurred.

Any contingent consideration payable is measured at fair value at the acquisition date. If the contingent consideration is classified as equity, then it
is not re-measured and settlement is accounted for within equity. Otherwise, subsequent changes in fair value of the contingent consideration are
recognised in the consolidated income statement.

Subsidiaries
Subsidiaries are investees controlled by the Company (directly or indirectly). The Company controls an investee if it is exposed to, or has rights to,
variable returns from its involvement with the investee and has the ability to affect those returns through its power over the investee.

The Company is an Investment Entity and measures investments in certain subsidiaries at fair value through profit or loss. In determining whether
the Company meets the definition of an Investment Entity, the management considered the Group structure as a whole (see also Note 2).

Although the Company qualifies as an Investment Entity and is required to value certain subsidiaries at fair value, the Company has a number of
subsidiaries which provide services that relate to the Company’s investment activities. These subsidiaries are consolidated on a line-by-line basis
(see Note 19).

Acquisition of non-controlling interests (consolidated subsidiaries)
Acquisitions of non-controlling interests are accounted for as transactions with owners in their capacity as owners and therefore no goodwill is
recognised as a result. Adjustments to non-controlling interest arising from transactions that do not involve the loss of control are based on a
proportionate amount of the net assets of the subsidiary.

Loss of control (consolidated subsidiaries)
For subsidiaries which are consolidated on a line-by-line basis, upon the loss of control, the Group derecognises the assets and liabilities of the
subsidiary, any non-controlling interests and the other components of equity related to the subsidiary. Any surplus or deficit arising on the loss
of control is recognised in the consolidated income statement. If the Group retains any interest in the previous subsidiary, then such interest is
measured at fair value at the date that control is lost. Subsequently, it is accounted for as an investment at fair value through profit or loss.

Transactions eliminated on consolidation (consolidated subsidiaries)
Intra-group receivables, liabilities, revenue and expenses are eliminated in their entirety when preparing the consolidated financial statements.
Gains that arise from intra-group transactions and that are unrealised from the standpoint of the Group, at the date of the consolidated statement
of financial position, are eliminated in their entirety. Unrealised losses on intra-group transactions are also eliminated in the same way as unrealised
gains, to the extent that the loss does not correspond to an impairment loss.

b) Foreign currency transactions
Transactions in foreign currencies are translated into Pounds Sterling at the exchange rate at the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies at the reporting date are translated into Pounds Sterling at the exchange rate on that date.

Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated into Pounds Sterling at
the exchange rate on the date that the fair value was determined. Foreign currency differences arising on translation are recognised in the
consolidated income statement as a gain or loss on currency translation.

BBGI Global Infrastructure S.A. | Annual Report 2021

103

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 20213. Summary of significant accounting policies (continued)

c) Foreign currency translations
The assets and liabilities of foreign operations are translated to Pounds Sterling at the exchange rates on the reporting date. The income and
expenses of foreign operations are translated to Pounds Sterling at the average exchange rates during the year, if such does not significantly
deviate from the exchange rates at the date on which the transaction is entered into. If significant deviations arise, then the exchange rate at the
date of the transaction is used.

Foreign currency differences are recognised in the consolidated statement of other comprehensive income, and presented in ‘translation reserve’
in equity, except for exchange differences from intra-Group monetary items which are reflected in the consolidated income statement. However,
since the Company qualifies as an investment entity under IFRS 10 and records its investments in subsidiaries as investment at FVPL, ‘translation
reserve’ movements during the reporting period relating to investments are classified as ‘Income from investments at fair value through profit or
loss’ (income from Investments at FVPL). If the foreign operation is a non-wholly owned consolidated subsidiary, then the relevant portion of the
translations difference is allocated to the non-controlling interest.

When a foreign operation is disposed of such that control, significant influence or joint control is lost, the cumulative amount in the translation
reserve related to that foreign operation is reclassified to consolidated income statement as part of the gain or loss on disposal. When the Group
disposes of only part of its interest in a consolidated subsidiary that includes a foreign operation while retaining control, the relevant proportion of
the cumulative amount is reattributed to non-controlling interests.

When the settlement of a monetary item receivable from or payable to a foreign operation is neither planned nor likely in the foreseeable future,
foreign currency gains and losses arising from such an item are considered to form part of a net investment in the foreign operation and are
recognised in other comprehensive income, and presented in the translation reserve in equity.

d) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

Financial assets
Financial assets are classified at initial recognition at either: (i) amortised cost; (ii) fair value through other comprehensive income – debt
instruments; (iii) fair value through other comprehensive income – equity instruments; or (iv) fair value through profit or loss.

In general, the Group derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the rights to
receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are transferred.
Any interest in such transferred financial assets that is created or retained by the Group is recognised as a separate financial asset or liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Group has a
legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

At the date of the consolidated statement of financial position, except for Investments at FVPL and derivative financial assets, all non-derivative
financial assets of the Group have been classified as financial assets at amortised cost.

Investments at FVPL
The Company is an Investment Entity and therefore values its investment in subsidiaries at fair value through profit or loss, except where the
subsidiary provides investment related services or activities. The fair value of an investment in subsidiary includes the fair value of the equity, loans
and interest receivable and any other amounts which are included in the discounted estimated cash flow (which is used to compute the fair value)
from such subsidiary. The Company subsequently measures its investment in certain subsidiaries at fair value in accordance with IFRS 13, with
changes in fair value recognised in consolidated income statement in the period of change. The fair value estimation of investments in subsidiaries
is described in Note 18.

Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest rate (‘EIR’) method and are subject to impairment. Gains
and losses are recognised in the consolidated statement of income when the asset is derecognised, modified or impaired.

The Group recognises an allowance for expected credit losses (‘ECLs’) for all debt instruments not held at fair value through profit or loss. ECLs are
based on the difference between the contractual cash flows due in accordance with the contract and all the cash flows that the Group expects to
receive, discounted at an approximation of the original effective interest rate.

The Group applies a simplified approach in calculating ECLs. Therefore, the Group does not track changes in credit risk, but instead recognises a
loss allowance based on lifetime ECLs at each reporting date.

104

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021Notes to the Consolidated Financial Statement continued

For the year ended 31 December 2021

3. Summary of significant accounting policies (continued)

d) Financial instruments (continued)

Non-derivative financial liabilities
The Company classifies non-derivative financial liabilities as liabilities at amortised cost. Such financial liabilities are recognised initially at fair value
less any direct attributable transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortised cost using the
EIR method.

The Company derecognises a financial liability (or part of a financial liability) from the consolidated statement of financial position when, and only
when, it is extinguished or when the obligation specified in the contract or agreement is discharged or cancelled or has expired. The difference
between the carrying amount of a financial liability (or part of a financial liability) extinguished or transferred to another party and the consideration
paid, including any non-cash assets transferred or liabilities assumed, is considered in the consolidated income statement.

e) Fair value measurement
The Group accounts for its investments in PPP/PFI entities (‘Portfolio Companies’) as Investments at FVPL. The valuation is determined using the
discounted cash flow methodology. The cash flows forecasted to be received by the Company or its consolidated subsidiaries, generated by each
of the underlying assets, and adjusted as appropriate to reflect the risk and opportunities, have been discounted using asset-specific discount rates.
The valuation methodology is the same one used in previous reporting periods.

The fair value of other financial assets and liabilities, other than current assets and liabilities, is determined by discounting future cash flows at an
appropriate discount rate and with reference to recent market transactions, where appropriate. Further information on assumptions and estimation
uncertainties are disclosed in Note 18.

Fair values are categorised into different levels in a fair value hierarchy based on the inputs in the valuation methodology, as follows:
–

 Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities.

–

 Level 2: inputs other than quoted prices included in Level 1, that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices).

 Level 3: inputs for the asset or liability that are not based on observable market data (‘unobservable inputs’).

If the inputs to measure fair value of an asset or a liability fall into different levels of the fair value hierarchy, then the fair value measurement is
categorised in its entirety at the same level of the fair value hierarchy as the lowest level input that is significant to the entire measurement.

The Group recognises transfers between levels of fair value hierarchy at the end of the reporting period in which the change has occurred.

f) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated reliably, and it
is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to a liability. The
unwinding of such discount is recognised as finance cost.

g) Cash and cash equivalents
Cash and cash equivalents comprise of cash balances and term deposits with maturities of three months or less from the date when the deposits
were made and that are subject to an insignificant risk of change in their fair value, and are used by the Group in the management of its short-term
commitments.

h) Share capital
Ordinary shares are classified as equity. Costs directly attributable to the issue of ordinary shares, or which are associated with the establishment of
the Company, that would otherwise have been avoided are recognised as a deduction from equity, net of any tax effects.

i) Segment reporting
Segment results that are reported to the Management Board include items directly attributable to segments as well as those that can be allocated
on a reasonable basis.

j) Employee benefits
Short-term and other long-term employee benefits are expensed as the related services are provided. A liability is recognised for the amount
expected to be paid, and discounted at present value if necessary, if the Group has present legal or constructive obligation to pay this amount as a
result of a past service provided by the employee and the obligation can be estimated reliably.

For share-based payment arrangements, the grant-date fair value of the equity settled share-based payment arrangement is recognised as an
expense, with a corresponding increase in additional paid in capital over the vesting period of the awards. The amount recognised as an expense is
adjusted to reflect related service and non-market performance conditions. The market condition related to the award is measured at the date of grant
and there is no adjustment of expense/income to the consolidated income statement for differences between expected and actual outcomes.

BBGI Global Infrastructure S.A. | Annual Report 2021

105

k) Finance income and finance costs
Interest income and expenses are recognised in the consolidated income statement using the EIR method.

The effective interest rate is the rate that exactly discounts the estimated future cash payments and receipts through the expected life of the
financial instrument (or, where appropriate, a shorter period) to the carrying amount of the financial instrument. When calculating the effective
interest rate, the Group estimates future cash flows considering all contractual terms of the financial instrument, but not future credit losses.

Interest received or receivable and interest paid or payable are recognised in the consolidated income statement as finance income and finance
costs, respectively.

l) Leases
Under IFRS 16, upon lease commencement, a lessee recognises a right-of-use asset and a lease liability. The right-of-use asset is initially measured
at cost, which comprises the initial amount of the lease liability adjusted for any lease payments made at or before the commencement date, plus
any initial direct costs incurred and an estimate of costs to dismantle and remove any improvements made to office premises.

m) Tax
According to the Luxembourg regulations regarding SICAV companies, the Company itself, as an undertaking for collective investment, is exempt
from paying income and/or capital gains taxes in Luxembourg. It is, however, liable to annual subscription tax of 0.05 per cent. on its consolidated
net asset value (‘NAV’), payable quarterly and assessed on the last day of each quarter.

Income tax on the consolidated subsidiaries’ profits for the year comprises current and deferred tax. Current and deferred tax is recognised in
the consolidated income statement except to the extent that it relates to a business combination, or items recognised directly in equity or in the
consolidated statement of other comprehensive income.

Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at
the reporting date, and any adjustment to tax payable in respect of previous periods.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for taxation purposes. Deferred tax is not recognised for:

–

 Temporary differences on the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither
accounting nor taxable profit or loss;

 Temporary differences related to investments in subsidiaries to the extent that the Company is able to control the timing of the reversal of the
temporary difference and it is probable that they will not reverse in the foreseeable future; and

 Taxable temporary differences arising on the initial recognition of goodwill.

Deferred tax assets and liabilities are offset if there is a legally enforceable right to offset current tax liabilities and assets, and they relate to taxes
levied by the same tax authority on the same taxable entity, or on different tax entities, but they intend to settle current tax liabilities and assets on a
net basis or their tax assets and liabilities will be realised simultaneously.

A deferred tax asset is recognised for unused tax losses, tax credits and deductible temporary differences to the extent that it is probable that future
taxable profits will be available against which they can be utilised. Deferred tax assets are reviewed each reporting date and are reduced to the
extent that it is no longer probable that the related tax benefit will be realised.

n) Current versus non-current classification
The Group presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is current when
it is:

–

 Expected to be realised or intended to be sold or consumed in the normal operating cycle

 Held primarily for the purpose of trading

 Expected to be realised within 12 months after the reporting period or

 Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period

All other assets are classified as non-current.

A liability is current when:
–

 It is expected to be settled in the normal operating cycle

–

 It is held primarily for the purpose of trading

 It is due to be settled within 12 months after the reporting period; or

 There is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period

106

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 20213. Summary of significant accounting policies (continued)

n) Current versus non-current classification (continued)
The terms of the liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its
classification.

The Group classifies all other liabilities as non-current.

4. Significant accounting judgements, estimates and assumptions
The preparation of consolidated financial statements in conformity with IFRS requires the Management Board to make judgements, estimates and
assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results
may differ from these estimates.

Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which
the estimates are revised and in any future periods affected.

In the process of applying the Group’s accounting policies, the Management Board has made the following judgements that would have the most
significant effect on the amounts recognised in the consolidated financial statements.

4.1 Assessment as an investment entity
Refer to Note 2 for the discussion on this topic.

4.2 Fair value determination
Refer to Note 3 e) for the discussion on this topic.

4.3 Share-based payments
Estimating fair value for share-based payment transactions requires determination of the most appropriate valuation model, which depends on the
terms and conditions of the grant. This estimate also requires determination of the most appropriate inputs to the valuation model including the
expected life of the share option or appreciation right, volatility and dividend yield and making assumptions about them.

For the measurement of the fair value of equity-settled transactions for the Long-Term Incentive Plan (‘LTIP’), the Group uses a Monte Carlo
simulation model for the market-based performance condition element of the awards. Non-market based performance conditions are not taken
into account in the valuation of the unit fair value per share of the LTIP. Instead, the number of shares is adjusted at each reporting date to take into
account the actual level of non-market based performance condition.

For the measurement of the fair value of equity-settled transactions for the Deferred Short-Term Incentive Plan (‘Deferred STIP’), the Group
recognises a portion of the annual estimated bonus of the Management Board. The assumptions and models used for estimating fair value for
share-based payment transactions are disclosed in Note 20.

4.4 Going concern basis of accounting
As part of its assessment, the Management Board has considered the risk posed by the COVID-19 pandemic. The Group’s portfolio is more than
99 per cent. operational and relies on availability-based revenues. At the time of producing these consolidated financial statements, there was
no evidence to suggest of material disruption to the operations of the Group and financial performance is not expected to be materially affected.
However, there is naturally significant uncertainty around how the pandemic will evolve and therefore it is difficult to foresee all consequences or
disruptions potentially arising from the pandemic.

The Management Board has satisfied itself that the Group has adequate resources to continue in operational existence for at least 12 months from
the date of approval of the consolidated financial statements. After due consideration, the Management Board believes it is appropriate to adopt
the going concern basis of accounting in preparing the consolidated financial statements.

5. Segment reporting
IFRS 8 – Operating Segments adopts a ‘through the eyes of the management’ approach to an entity’s reporting of information relating to its
operating segments, and also requires an entity to report financial and descriptive information about its reportable segments.

Based on a review of information provided to the Management Board, the Group has identified five reportable segments based on the
geographical concentration risk. The main factor used to identify the Group’s reportable segments is the geographical location of the asset. The
Management Board has concluded that the Group’s reportable segments are:

(1) UK; (2) North America; (3) Australia; (4) Continental Europe; and (5) Holding Activities. These reportable segments are the basis on which the
Group reports information to the Management Board.

BBGI Global Infrastructure S.A. | Annual Report 2021

107

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 20215. Segment reporting (continued)
Segment information is presented below:

For the year ended 31 December 2021

In thousands of Pounds Sterling

Income from investments at FVPL

Administrative expenses

Other operating expenses – net

Results from operating activities

Net finance result

Net loss on balance sheet hedging

Tax expense – net

North
America

4,718

65,061

–

Australia

1,509

–

Continental
Europe

4,155

Holding
Activities

Total
Group

–

75,443

–

(10,234)

(1,758)

4,718

65,061

1,509

4,155

(11,992)

63,451

–

(1,974)

(782)

(1,974)

(782)

(2,698)

Profit or loss from continuing operations

4,718

65,061

1,509

4,155

(17,446)

57,997

For the year ended 31 December 2020

In thousands of Pounds Sterling

Income from investments at FVPL

Administration expenses

Other operating expenses

18,715

–

North
America

15,685

–

Australia

22,062

–

Continental
Europe

Holding
Activities

6,875

–

(9,607)

(7,082)

Total
Group

63,337

(9,607)

(7,082)

Results from operating activities

18,715

15,685

22,062

6,875

(16,689)

46,648

Net finance result

Net loss on balance sheet hedging

Tax expense – net

–

Profit or loss from continuing operations

18,715

15,685

22,062

6,875

(1,647)

(642)

(2,649)

(21,627)

(1,647)

(642)

(2,649)

41,710

Statement of financial position per segment information as at 31 December 2021 and 2020 are presented below:

–

North
America

Australia

Continental
Europe

Holding
Activities

Total
Group

–

319,324

456,690

110,242

88,969

–

975,225

–

1,417

29,554

319,324

456,690

110,242

88,969

31,039

1,006,264

–

429

5,292

5,721

429

5,292

5,721

As at 31 December 2021

In thousands of Pounds Sterling

Assets

Property and equipment

Investments at FVPL

Other non-current assets

Current assets

Total assets

Liabilities

Non-current

Current

Total liabilities

108

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 20215. Segment reporting (continued)

As at 31 December 2020

In thousands of Pounds Sterling

Assets

Property and equipment

Investments at FVPL

Other non-current assets

Current assets

Total assets

Liabilities

Non-current

Current

Total liabilities

–

North
America

Australia

Continental
Europe

Holding
Activities

Total
Group

–

264,797

418,063

117,984

94,830

–

264,797

418,063

117,984

94,830

–

237

24,574

24,869

218

4,485

4,703

895,674

237

24,574

920,543

218

4,485

4,703

The Holding Activities of the Group include the activities which are not specifically related to a particular asset or region, but to those companies
which provide services to the Group. The total current assets classified under Holding Activities mainly represent cash and cash equivalents.

Transactions between reportable segments are conducted at arm’s length and are accounted for in a similar way to the basis of accounting used for
third parties. The accounting methods used for all the segments are similar and comparable with those of the Company.

6. Administrative expenses

In thousands of Pounds Sterling

Personnel expenses

Legal and professional fees

Office and other expenses

Depreciation expense

Year ended
31 December
2021

Year ended
31 December
2020

6,915

2,496

800

6,246

2,570

764

10,234

9,607

The Group has engaged certain third parties to provide legal, depositary, custodian, audit, tax and other services to the Group. The expenses
incurred in relation to such services are treated as legal and professional fees. Depositary and custodian related charges during the year amounted
to £459,000 (2020: 347,000).

During the year, the Company and its consolidated subsidiaries obtained the following services from the external auditors.

In thousands of Pounds Sterling

Group auditor remuneration:

Statutory audit fees to the Group’s external auditor

Audit-related fees

Other statutory audit fees

Year ended
31 December
2021

Year ended
31 December
2020

177

275

187

282

Audit-related fees includes the fees in respect to the interim review of the Group’s condensed consolidated interim financial statements and other
permitted audit-related services.

There were no non-audit related fees charged by the Group’s external auditor during the year (31 December 2020: nil).

BBGI Global Infrastructure S.A. | Annual Report 2021

109

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 20217. Other operating expenses

In thousands of Pounds Sterling

Acquisition-related including unsuccessful bid costs

Loss on derivative financial instruments at FVPL – net (Note 18)

Foreign currency exchange loss – net

Others

8. Net finance result

In thousands of Pounds Sterling

Finance costs on loans and borrowings (Note 15)

Other finance costs

Interest income on bank deposits

9. Investments at FVPL

In thousands of Pounds Sterling

Balance at 1 January

Acquisitions of/additions in Investments at FVPL

Income from investments at FVPL(i)

Distributions received from Investments at FVPL

Balance at 31 December

Year ended
31 December
2021

Year ended
31 December
2020

1,477

1,015

–

2,492

1,626

853

4,767

7,268

Year ended
31 December
2021

Year ended
31 December
2020

(1,905)

(1,657)

(69)

–

(1,974)

(1,647)

31 December
2021

31 December
2020

895,674

845,967

79,163

75,443

59,185

63,337

(75,055)

(72,815)

975,225

895,674

(i) This account reflects the unrealised gain on revaluation of investments.

The impact of foreign exchange gains or losses on income from Investments at FVPL for the year ended 31 December 2021 amounted to a net
loss of £3.2 million (year ended 31 December 2020: net gain of £3.2 million). Refer to Note 18 of the consolidated financial statements for further
information on investments at FVPL.

Distributions from Investments at FVPL are received after either: (a) financial models have been tested for compliance with certain ratios; or (b)
financial models have been submitted to the external lenders of the Portfolio Companies; or (c) approvals of the external lenders on the financial
models have been obtained.

As at 31 December 2021 and 2020, loan and interest receivable from unconsolidated subsidiaries is embedded within Investments at FVPL.

The valuation of Investments at FVPL considers all future cash flows related to each individual underlying asset.

Interest income, dividend income, asset-related management fee income and other income, recorded under the accrual’s basis at the level of the
consolidated subsidiaries for the year ended 31 December 2021, amounted to £67,046,000 (31 December 2020: £65,689,000). The associated
future cash flows deriving from these items are considered when fair valuing the investments.

During the year, the Group made four acquisitions and one follow-on subscription as follows:

– Poplar Affordable Housing & Recreational Centres (United Kingdom): In April 2021, the Group acquired a 100 per cent. interest in a social
infrastructure investment consisting of two recreation facilities and 100 affordable residential units across two sites in the London Borough
of Tower Hamlets. This PPP project originally consists of the design, construction, financing, operation, maintenance and rehabilitation of
separate buildings: the major regeneration and refurbishment of the derelict Poplar Baths building into a modern first-class community leisure
centre and the construction of the Haileybury Community Centre, Randall House (60 affordable residential units), Dame Colet Court (25
affordable residential units) and Baltonsborough Court (15 affordable residential units).

110

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021
9. Investments at FVPL (continued)

Construction was completed in 2016 and the concession runs until 2051. Availability payments are to be received from the London Borough of
Tower Hamlets.

– Ayrshire and Arran Hospital (United Kingdom): In July 2021, the Group acquired a 100 per cent. interest in this project which consists of the
design, construction, financing and maintenance of a 206-bed acute mental health facility and community hospital in Irvine, North Ayrshire,
Scotland. The hospital became operational in 2016 and the concession runs until 2041.

The facility has significantly increased the availability of and access to mental health services and treatment in the region. The facility was
awarded a Building Research Establishment Environmental Assessment Method (‘BREEAM’) rating of ‘very good’ and is equipped with low or
zero carbon heating and power technology. Availability payments are received from the Ayrshire and Arran Health Board.

– North West Fire and Rescue (United Kingdom): In July 2021, the Group acquired a 100 per cent. interest in this project which consists of

the design, construction, financing, operations and maintenance and rehabilitation of 16 new community fire stations located at various sites in
Merseyside (seven), Lancashire (four) and Cumbria (five).

The facilities became fully operational in 2013 and the concession runs until 2038. The facilities play an integral role in delivering fire safety
and protection to more than 500,000 people in the local communities. The facilities were awarded a BREEAM rating of Very Good and
sustainability measures have been integrated into the buildings. Availability payments are received from the Cumbria County Council,
Lancashire Combined Fire Authority and Merseyside Fire and Rescue Authority.

– Aberdeen Western Peripheral Route (United Kingdom): In August 2021, the Group acquired a 33.33 per cent. interest this project which

encompasses the design, construction, financing, operations and maintenance of 12 km of the existing roadway (upgraded) and 47 km of new
dual carriageway including two significant river crossings. The final section of the road opened in 2019 and the concession runs until 2047.

The project was developed in compliance with strict EU environmental legislation and has reduced congestion in Aberdeen by approximately
46 per cent. and HGV traffic on local routes by approximately 55 per cent.. Availability payments are received from the Scottish Ministers.

– McGill University Health Centre (Canada): In December 2021, the final value of the acquired property was consummated resulting to an
upward adjustment to the original purchase price. This transaction does not result in a change in Group’s indirect interest in the project.

Details of various asset investments in the Group’s portfolio and their respective acquisition dates are as follows:

Company

Asset

Country of
Incorporation

Ownership
Interest

Year
Acquired

RW Health Partnership Holdings Pty Limited*

Royal Women’s Hospital

Victorian Correctional Infrastructure Partnership Pty Limited

Victoria Correctional Facilities

Australia

BBPI Sentinel Holdings Pty Limited*

BBGI Sentinel Holdings 2 Pty Limited*,
and Sentinel Financing Holdings Pty Limited*

Northern Territory Secure Facilities

Australia

100%

Golden Crossing Holdings Inc.*

Golden Ears Bridge

Canada

100%

Trans-Park Highway Holding Inc.*

NorthwestConnect Holdings Inc.*

BBGI KVH Holdings Inc.*

WCP Holdings Inc.*

Stoney Trail Group Holdings Inc.*

BBGI NCP Holdings Inc.*

SNC-Lavalin Infrastructure Partners LP*

Kicking Horse Canyon

Northwest Anthony Henday Drive

Kelowna and Vernon Hospital

Women’s College Hospital

Northeast Stoney Trail

North Commuter Parkway

William R. Bennet Bridge

Southeast Stoney Trail

Canada Line

Restigouche Hospital Centre

McGill University Health Centre

Canada

50%

100%

50%

80%

40%

26.7%

80%

40%

BBGI Stanton Holdings Inc.*

Stanton Territorial Hospital

Canada

100%

BBGI 104 GP Inc.

BBGI Champlain Holding Inc.*

Kreishaus Unna Holding GmbH*

Highway 104

Champlain Bridge

Unna Administrative Centre

Canada

Germany

50%

25%

90%

2012

2014
and 2015

2012
and 2013

2012

2013
and 2020

2013

2015

2017

2018
and 2021

2018
and 2020

2020

2012
and 2020

BBGI Global Infrastructure S.A. | Annual Report 2021

111

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021

9. Investments at FVPL (continued)

Company

PJB Beteiligungs – GmbH*

Hochtief PPP 1 Holding GmbH & Co.KG*

Asset

Burg Correctional Facility

Cologne Schools

Rodenkirchen Schools

Frankfurt Schools

Fürst Wrede Military Base

Country of
Incorporation

Ownership
Interest

Year
Acquired

90%

50%

2012

2014

Germany

Noaber18 Holding B.V.*

N18 Motorway

Netherlands

52%

De Groene SchakelHolding B.V. *

Westland Town Hall

Netherlands

100%

SAAone Holding B.V.

A1/A6 Motorway

Netherlands

37.14%

Agder OPS Vegselskap AS

E18 Motorway

Norway

100%

Folera TH Holdings Limited

Poplar Affordable Housing
& Recreational Centres

Jersey

100.0%

Kent Education Partnership (Holdings) Limited*

Kent Schools

Healthcare Providers (Gloucester) Ltd.*

Gloucester Royal Hospital

Highway Management M80 Topco Limited*

Bedford Education Partnership Holdings Limited*

Lisburn Education Partnership Holdings Limited*

M80 Motorway

Bedford Schools

Lisburn College

Clackmannanshire Schools Education Partnership

Clackmannanshire Schools

(Holdings) Limited*

Primaria (Barking & Havering) Limited*

Barking & Havering Clinics (LIFT)

East Down Education Partnership (Holdings) Limited*

East Down Colleges

Scottish Borders Education Partnership (Holdings) Limited*

Scottish Borders Schools

Coventry Education Partnership Holdings Limited*

Coventry Schools

Fire Support (SSFR) Holdings Limited*

Stoke & Staffs Rescue Service

GB Consortium 1 Limited*

North London Estates
Partnership (LIFT)

Liverpool & Sefton Clinics (LIFT)

Mersey Care Development Company 1 Limited*

Mersey Care Hospital

MG Bridge Investments Limited*

Mersey Gateway Bridge

Tor Bank School Education Partnership (Holdings) Limited*

Tor Bank School

Lagan College Education Partnership (Holdings) Limited*

Lagan College

Highway Management (City) Holding Limited*

M1 Westlink

Blue Light Partnership (ASP) NewCo Limited*

Avon and Somerset Police HQ

Blue Light Partnership (ASP) NewCo 2 Limited*

Northwin Limited

North West Regional College

Northwin (Intermediate) (Belfast) Limited*

Belfast Metropolitan College

Fire and Rescue NW Holdings Limited

Woodland View Holdings Co Limited

North West Fire and Rescue

Ayrshire and Arran Hospital

Aberdeen Roads Holdings Limited

Aberdeen Western Peripheral Route

BBGI East End Holdings Inc.*

Ohio River Bridges

*and its subsidiary companies.
112

BBGI Global Infrastructure S.A. | Annual Report 2021

50%

100%

60%

100%

85%

60%
(both)

79.6%

37.5%

100%

100.0%

33.33%

66.67%

2018,
2019 and
2020

2018
and 2019

2013 and
2014

2021

2012

2012
and 2018

2012

2012,
2014 and
2018

2013
and 2014

2014

2013

2014

2014, 2015
and 2016

2015

2016

2021

2014
and 2019

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202110. Cash and cash equivalents
Cash and cash equivalents relate to bank deposits amounting to £26,862,000 (31 December 2020: £20,532,000).

11. Taxes

In thousands of Pounds Sterling

Current tax:

Income tax and other taxes

Subscription tax

Deferred tax:

Relating to origination and reversal of temporary differences

Year ended
31 December
2021

Year ended
31 December
2020

2,008

459

2,467

231

2,698

2,449

427

2,876

(227)

2,649

The Company, as an undertaking for collective investment, is exempt from corporate income tax in Luxembourg and instead pays an annual
subscription tax of 0.05 per cent. on the value of its total net assets. Moreover, the Company as a SICAV is not subject to taxes on capital gains or
income. All other consolidated subsidiaries are subject to taxation at the applicable rate in their respective jurisdictions.

Reconciliation of tax expense and the accounting profit multiplied by the Company’s effective corporate tax rate for the year is as follows:

In thousands of Pounds Sterling

Profit before tax

Income tax using the Luxembourg domestic tax rate of 24.94%

Subscription tax during the year

Reconciling difference mainly due to fair valuation of assets, net of gain/loss on derivatives (unrealised)

Tax charge for the year

Year ended
31 December
2021

Year ended
31 December
2020

60,695

15,137

459

(12,898)

2,698

44,359

11,063

427

(8,841)

2,649

A significant portion of the profit before tax results from fair valuation of Investments at FVPL. The net income of the unconsolidated subsidiaries is
taxed in their respective jurisdictions.

As a consequence of the adoption of IFRS 10, the Company is classified as an Investment Entity (see Note 2), meaning the tax expenses of the
unconsolidated subsidiaries are not included within these consolidated financial statements. Therefore, the consolidated tax expense and tax
assets/liabilities, if any, do not include those of the Portfolio Companies. The tax liabilities of the Portfolio Companies are embedded in the fair value
calculation of the Investments at FVPL.

The Group did not recognise any deferred tax asset during the year (31 December 2020: £225,000). Furthermore, the Group has additional tax
losses carried forward amounting to £7,229,000 (2020: £5,823,000) for which no deferred tax asset was recognised.

Tax liability as at 31 December 2021 amounted to £1,373,000 (31 December 2020: £1,567,000).

12. Other current assets

In thousands of Pounds Sterling

Prepaid taxes

Prepaid expenses

Others

31 December
2021

31 December
2020

587

163

761

1,627

413

124

2,164

BBGI Global Infrastructure S.A. | Annual Report 2021

113

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202113. Capital and reserves

Share capital
Changes in the Company´s share capital are as follows:

In thousands of Pounds Sterling

Share capital as at 1 January

Issuance of ordinary shares through placing

Shares issuance cost on placing

Share capital issued through scrip dividends

Equity settlement of share-based compensation (see Note 20)

The changes in the number of ordinary shares of no-par value issued by the Company are as follows:

In thousands of shares

In issue at beginning of the year

Shares issued through placing of ordinary shares

Shares issued through scrip dividends

Shares issued as share based compensation

31 December
2021

31 December
2020

770,942

75,000

(1,107)

1,978

1,045

714,280

55,000

(831)

2,068

425

847,858

770,942

31 December
2021

31 December
2020

664,691

45,181

1,155

1,099

630,213

32,544

1,244

690

712,126

664,691

In July 2021, the Company raised gross proceeds of £75,000,000 through a placing of 45,180,722 new ordinary shares of no-par value (‘Placing’).
The Placing price was 166.0 pence per Placing share. The related share issuance cost amounted to £1,107,000.

All shares rank equally with regard to the Company’s residual assets. The holders of ordinary shares are entitled to receive dividends as declared
from time to time and are entitled to one vote per share at general meetings of the Company.

The Company meets the minimum share capital requirement as imposed under the applicable Luxembourg regulation.

Translation reserve
Foreign currency differences are recognised in other comprehensive income and presented in the foreign currency translation reserve in equity
except for exchange differences from intragroup monetary items which are reflected in the consolidated income statement. The translation reserve
comprises foreign currency differences arising from the translation of the financial statements of foreign operations.

Dividends
The dividends declared and paid by the Company during the year ended 31 December 2021 are as follows:

In thousands of Pounds Sterling except as otherwise stated

2020 2nd interim dividend of 3.59 pence per qualifying ordinary share – for the period 1 July 2020 to 31 December 2020

2021 1st interim dividend of 3.665 pence per qualifying ordinary share – for the period 1 January 2021 to 30 June 2021

Total dividends declared and paid during the year

31 December
2021

23,863

26,068

49,931

The 31 December 2020 2nd interim dividend was paid in April 2021. The value of the scrip election was £514,000, with the remaining amount of
£23,349,000 paid in cash to those investors that did not elect for the scrip.

The 30 June 2021 1st interim dividend was paid in October 2021. The value of the scrip election was £1,464,000 with the remaining amount of
£24,604,000 paid in cash to those investors that elected for a cash dividend.

The dividends declared and paid by the Company during the year ended 31 December 2020 are as follows:

In thousands of Pounds Sterling except as otherwise stated

2019 2nd interim dividend of 3.5 pence per qualifying ordinary share – for the period 1 July 2019 to 31 December 2019

2020 1st interim dividend of 3.59 pence per qualifying ordinary share – for the period 1 January 2020 to 30 June 2020

Total dividends declared and paid during the year

31 December
2020

22,057

22,659

44,716

114

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202113. Capital and reserves (continued)

Dividends (continued)
The 31 December 2019 2nd interim dividend was paid in April 2020. The value of the scrip election was £429,000, with the remaining amount of
£21,628,000 paid in cash to those investors that did not elect for the scrip.

The 30 June 2020 1st interim dividend was paid in October 2020. The value of the scrip election was £1,639,000 with the remaining amount of
£21,020,000 paid in cash to those investors that elected for a cash dividend.

Net Asset Value (‘NAV’)
The consolidated NAV and NAV per share as at 31 December 2021, 31 December 2020 and 31 December 2019 were as follows:

In thousands of Pounds Sterling/pence

NAV attributable to the owners of the Company

NAV per ordinary share (pence)

14. Earnings per share

2021

2020

2019

1,000,543

915,840

861,632

140.50

137.78

136.72

a) Basic earnings per share
The basic earnings per share is calculated by dividing the profit attributable to the owners of the Company by the weighted average number of
ordinary shares outstanding.

In thousands of Pounds Sterling / in thousands of shares

Profit attributable to the owners of the Company

Weighted average number of ordinary shares in issue

Basic earnings per share (in pence)

Year ended
31 December
2021

Year ended
31 December
2020

57,997

41,710

684,569

633,662

8.47

6.58

The weighted average number of ordinary shares outstanding for the purpose of calculating the basic earnings per share is computed as follows:

In thousands of shares

Shares outstanding as at 1 January

Effect of shares issued on placing of ordinary shares

Effect of scrip dividends issued

Shares issued as share based compensation

Weighted average – outstanding shares

Year ended
31 December
2021

Year ended
31 December
2020

664,691

630,213

18,825

366

687

2,712

363

374

684,569

633,662

b) Diluted earnings per share
The diluted earnings per share is calculated by dividing the profit attributable to the owners of the Company by the weighted average number of
ordinary shares outstanding, after adjusting for the effects of all potential dilutive ordinary shares. There were no items of the consolidated income
statement accounts which have a dilutive effect on the profit attributable to the owners of the Company.

The weighted average number of potential diluted ordinary shares for the purpose of calculating the diluted earnings per share is computed
as follows:

In thousands of shares

Weighted average number of ordinary shares for basic earnings per share

Effect of potential dilution from share-based payment

Weighted average – outstanding shares

Year ended
31 December
2021

Year ended
31 December
2020

684,569

633,662

985

1,122

685,554

634,784

The price of the Company’s shares for the purpose of calculating the potential dilutive effect of award letters (Note 20) was based on the average
market price for the year ended 2021 and 2020, during which period the awards were outstanding.

BBGI Global Infrastructure S.A. | Annual Report 2021

115

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202115. Loans and borrowings
Previously, the Group had a four-year £180 million Revolving Credit Facility (‘RCF’) from ING Bank N.V. London Branch (‘ING Bank’), and KfW
IPEX-Bank GmBH (‘KfW IPEX Bank’) and DZ Bank AG Deutsche Zentral Genossenschaftsbank (‘DZ Bank’) which commenced in January 2018 and
had a maturity date in January 2022. The borrowing margin was 165 bps over LIBOR.

On 21 May 2021, the Group secured an amendment and restatement to the multi-currency RCF with ING Bank, KFW IPEX Bank, DZ Bank,
Frankfurt Am Main and SMBC Bank EU AG for a total commitment of £230 million. The tenor of the RCF is five years (maturing in May 2026). The
borrowing margin is 165 bps over the reference bank rate. Under the new RCF, the Group retains the possibility to consider larger transactions by
virtue of having structured a further £70 million incremental accordion tranche, for which no commitment fees will be paid.

As at 31 December 2021, the Group had utilised £1.2 million (31 December 2020: £1.2 million) of the £230 million RCF, which was being used to
cover letters of credit. There were no outstanding borrowings under the RCF as at 31 December 2021 (31 December 2020: nil).

The interest payable and other related RCF fee payables under the credit facility as at 31 December 2021 amounted to £246,000 (31 December
2020: £177,000).

The RCF unamortised debt issuance cost amounted to £1,417,000 as at 31 December 2021 (2020: £358,000). The unamortised debt issuance cost
is presented as part of ‘Other non-current assets’ in the Consolidated Statement of Financial Position (2020: as part of ‘Other current assets’).

The total finance cost incurred under the RCF for the year ended 31 December 2021 amounted to £1,927,000 (31 December 2020: £1,655,000)
which includes amortisation of debt issue expense of £549,000 (31 December 2020: £351,000).

Changes in liabilities arising from financing activities

In thousands of Pounds Sterling

Loans and borrowings_non-current

In thousands of Pounds Sterling

Loans and borrowings_non-current

1 January
2021

Proceeds

Repayment

Others

31 December
2021

–

67,000

(67,000)

–

1 January
2020

20,318

Proceeds

Repayment

41,000

(62,000)

Others

682

31 December
2020

–

Pledges and collaterals
As of 31 December 2021, and 31 December 2020, the Group has provided a pledge over shares issued by consolidated subsidiaries, pledge over
receivables between consolidated subsidiaries and a pledge over the bank accounts of the consolidated subsidiaries.

Based on the provisions of the RCF, where there is a continuing event of default, the lender, among other things, will have the right to cancel all
commitments and declare all or part of utilisations to be due and payable, including all related outstanding amounts, and exercise or direct the
security agent to exercise any or all of its rights, remedies, powers or discretions under the RCF.

The Group operated comfortably within covenant limits of the RCF during the year.

16. Trade and other payables
Trade and other payables are non-interest bearing and are usually settled within six months.

17. Financial risk review and management
The Group has exposure to the following risks from financial instruments:
– Credit risk

–

Liquidity risk

– Market risk

This note presents information about the Group’s exposure to each of the above risks, the Group’s objectives, policies and processes for measuring
and managing risk and the Group’s management of capital. This note also presents the result of the review performed by management on the
above-mentioned risk areas.

Risk management framework
The Management Board has overall responsibility for the establishment and control of the Group’s risk management framework.

116

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021
17. Financial risk review and management (continued)

Credit risk
Credit risk is the risk that the counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with
the Group, resulting in:
1)
2) non-recoverability, in part or in whole, of cash and cash equivalents deposited with banks.

impairment or reduction in the amounts recoverable from receivables and other current and non-current assets; and

Exposures to credit risks
The Group is exposed to credit risks on the following items in the consolidated statement of financial position:

In thousands of Pounds Sterling

Derivative financial assets

Trade and other receivables

Cash and cash equivalents

31 December
2021

31 December
2020

907

1,024

26,862

28,793

259

1,631

20,532

22,422

The maximum exposure to credit risk on receivables that are neither overdue nor impaired as of 31 December 2021, amounts to £1,024,000 (2020:
£1,631,000).

As of 31 December 2021, the Group is also exposed to credit risk on the loan receivable, interest and other receivable components of Investments at
FVPL (loans provided to Portfolio Companies) totalling to £262,822,000 (2020: £216,631,000).

Cash and cash equivalents and foreign currency forwards
The cash and cash equivalents and foreign currency forward contracts (recorded either as ‘derivative financial assets’ or ‘derivative financial
liabilities’) are maintained with reputable banks with ratings that are acceptable based on the established internal policy of the Group. Based on the
assessment of the Management Board, there are no significant credit risks related to the cash and cash equivalents and foreign currency forward
contracts maintained. The main counterparty banks of the Group have S&P/Moody’s credit rating of A+/Aa3 and AA-/Aa2.

Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by
delivering cash or another financial asset.

The Group’s policy over liquidity risk is that it will seek to have sufficient liquidity to meet its liabilities and obligations when they fall due.

The Group manages liquidity risk by maintaining adequate cash and cash equivalents and access to borrowing facilities to finance day-to-day
operations and medium to long-term capital needs. The Group also regularly monitors the forecast and actual cash requirements and matches the
maturity profiles of the Group’s financial assets and financial liabilities.

The following are the undiscounted contractual maturities of the financial liabilities of the Group, including estimated interest payments:

31 December 2021

In thousands of Pounds Sterling

Loans and borrowings (Note 15)

Trade and other payables

Carrying
amount

246

2,956

3,202

Contractual cash flows

Total

5,801

2,956

8,757

Within
1 year

1,326

2,956

4,282

1-5
years

4,475

–

4,475

BBGI Global Infrastructure S.A. | Annual Report 2021

117

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202117. Financial risk review and management (continued)

Liquidity risk (continued)

31 December 2020

In thousands of Pounds Sterling

Loans and borrowings (Note 15)

Trade and other payables

Contractual cash flows

Carrying
amount

177

2,716

2,893

Total

1,220

2,716

3,936

Within
1 year

1,220

2,716

3,936

1-5
years

–

The Group needs to maintain certain financial covenants under the RCF. Non-compliance with such covenants may trigger an event of default (see
Note 15). At 31 December 2021 and 2020, the Group was not in breach of any of the covenants under the RCF.

The Company has the possibility of raising capital through the issuance of shares in order to finance further acquisitions or to repay debt.

All external financial liabilities of the Group have maturities of less than one year except for loans and borrowings, which have a maturity of more
than one year. The Group has sufficient cash and cash equivalents and sufficient funding sources to pay and/or refinance currently maturing
obligations.

Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, will affect the Group’s income
or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk exposures within
acceptable parameters, while optimising the returns.

UK departure from the European Union
As part of the UK’s preparations for Brexit, the UK Government established a temporary permissions regime (‘TPR’) enabling European Economic
Area (‘EEA’) AIFs with EEA AIFMs passporting into the UK at the end of the transition period to continue to access the UK market in the same
manner as before the transition period ended for a limited period of time.

During the year, the Company continued to access the UK market under the TPR. As previously reported, this TPR was for a limited period of time,
after which the Company would have to provide notification under the UK’s National Private Placement Regime (‘NPPR’) in order to continue to
market the Company in the UK.

In June 2021, the Company received confirmation from the FCA of its ‘Landing Slot’ during which BBGI is required to submit a notification under
the NPPR in order to continue to market BBGI to professional investors in the UK. In August 2021, BBGI provided the necessary written notification
to the FCA in advance of the 1 November 2021 deadline.

Regarding portfolio performance, while the long-term economic outcome of the UK’s departure from the EU will remain uncertain for some time,
the Group’s portfolio cash flows are contracted and, unlike demand-based assets, are not sensitive to the performance of the wider economic
environment.

Currency risk
The Group buys derivative financial instruments, and also incurs financial liabilities, in order to manage market risks. All such transactions are carried
out within certain internal guidelines. The Group, via its hedge counterparty, reports all trades under these hedging instruments, for European
Market Infrastructure Regulations purposes, to an EU branch of the derivative repository.
The Group is exposed to currency risk as a result of its underlying Investments at FVPL and cash and cash equivalents being denominated in
currencies other than Pounds Sterling. The currencies in which these items are primarily denominated are Australian dollars (A$), Canadian dollars
(C$), Euros (€), Norwegian kroner (NOK) and US dollars (US$).

The Group actively seeks to manage geographical concentration and mitigate foreign exchange risk by balance sheet hedging through foreign
exchange forward contracts, hedging of forecast portfolio distributions and borrowing in non-Sterling currencies. Furthermore, Euro-denominated
running costs provide a natural hedge against the Euro-denominated portfolio distributions.

In respect of other monetary assets and liabilities denominated in currencies other than Pounds Sterling, the Group’s policy is to ensure that
its net exposure is kept at an acceptable level. The Company accepts that risk from foreign exchange exposure is an inherent aspect of holding
an international portfolio of investments. However, the Management Board believes that, in addition to the hedging program in place, this risk
is further mitigated by having exposure to a number of different currencies including the Australian dollar, Canadian dollar, US dollar, Euro and
Norwegian krone, all of which can provide diversification benefits. The Management Board spends considerable time reviewing its hedging
strategy and believes it remains both appropriate and cost effective to continue with its four-year rolling hedge policy.

118

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021
17. Financial risk review and management (continued)

Currency risk (continued)
The summary of the quantitative data about the Group’s exposure to foreign currency risk are as follows:

Financial liabilities measured at amortised cost

Trade and other payables

(10)

(1,224)

(1,367)

31 December 2021

In thousands of Pounds Sterling

Financial assets measured at fair value

Investments at FVPL

Financial assets measured at amortised cost

Cash and cash equivalents

Trade and other receivables

31 December 2020

In thousands of Pounds Sterling

Financial assets measured at fair value

Investments at FVPL

Financial assets measured at amortised cost

Cash and cash equivalents

Trade and other receivables

€

NOK

US$

110,242

347,921

64,199

24,770

108,769

484

499

13,615

241

13,856

736

737

–

160

103

263

(29)

€

NOK

US$

117,984

337,417

66,615

28,216

80,645

341

365

11,542

589

12,131

1,020

1,104

Financial liabilities measured at amortised cost

Trade payables and other payables

(4)

(687)

(1,741)

The significant exchange rates applied during the year ended 31 December 2021 and 31 December 2020 are as follows:

A$ 1

C$ 1

€ 1

NOK 1

US$ 1

A$ 1

C$ 1

€ 1

NOK 1

US$ 1

–

2,125

526

2,651

–

31 December 2021

Average £

Spot rate £

0.546

0.580

0.860

0.085

0.727

0.537

0.583

0.840

0.084

0.740

31 December 2020

Average £

Spot rate £

0.538

0.581

0.889

0.083

0.780

0.565

0.575

0.899

0.086

0.733

The sensitivity of the NAV to a 10 per cent. positive and adverse movement in foreign exchange rates is disclosed in Note 18 to the consolidated
financial statements. This is a scenario that the Group considers to be reasonably possible at the reporting date. This scenario assumes that all other
variables, in particular interest rates, remain constant and ignores any impact of forecasted revenues and other related costs.

BBGI Global Infrastructure S.A. | Annual Report 2021

119

Interest rate risk
Except for the loans and other receivables from Portfolio Companies which are included as part of Investments at FVPL, the Group does not
account for other fixed-rate financial assets and liabilities at fair value through profit or loss. For the years ended 31 December 2021 and 2020, the
main variable interest rate exposure of the Group is on the interest rates applied to the Group’s cash and cash equivalents, including deposit rates
used in valuing the Investments at FVPL and the loans and borrowings of the Group. A change in the deposit rates used in valuing Investments at
FVPL would have an impact on the value of such and a corresponding impact on the Group’s NAV. Refer to Note 18 for a sensitivity analysis of the
impact of a change in deposit rates on the Group’s NAV.

Investment risk
The valuation of Investments at FVPL depends on the ability of the Group to realise cash distributions from Portfolio Companies. The distributions
to be received from the Portfolio Companies are dependent on cash received by a particular Portfolio Company under the service concession
agreements. The service concession agreements are predominantly granted to the Portfolio Companies by a variety of public sector clients
including, but not limited to, central government departments and local, provincial and state government and corporations set up by the public
sector.

The Group predominantly makes investments in countries where the Management Board consider that asset structures are reliable, where (to the
extent applicable) public sector counterparties carry what the Management Board consider to be an appropriate credit risk, or alternatively where
insurance or guarantees are available for the sovereign credit risk, where financial markets are relatively mature and where a reliable judicial system
exists to facilitate the enforcement of rights and obligations under the contracts.

The Management Board continuously monitors the ability of a particular Portfolio Company to make distributions to the Group. During the year,
there have been no material concerns raised in relation to current and future distributions to be received from any of the Portfolio Companies.

Capital risk management
The Company’s objective when managing capital is to ensure the Group’s ability to continue as a going concern in order to provide returns to
shareholders and benefits for further stakeholders and to maintain an optimal capital structure. The Company, at a Group level, views the share
capital (see Note 13) and the RCF (see Note 15) as capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend paid to shareholders, return capital to
shareholders, avail itself of additional debt financing, pay down debt or issue new shares.

The Group regularly reviews compliance with Luxembourg regulations regarding restrictions on minimum capital. During the year, the Group
complied with all externally imposed capital requirements and made no changes in its approach to capital management.

Derivative financial assets and liabilities for which hedge accounting is not applied
The Group has entered into foreign currency forwards to fix the foreign exchange rates on certain investment distributions that are expected
to be received and on a portion of the non-Pounds Sterling denominated portfolio value. The derivative financial instruments (asset/liability)
in the consolidated statement of financial position represent the fair value of foreign currency forwards which were not designated as hedges.
The movements in their fair value are directly charged/credited in the consolidated income statement within other operating expenses and net
gain(loss) on balance sheet hedging.

18. Fair value measurements and sensitivity analysis
The fair values of financial assets and liabilities, together with the carrying amounts shown in the consolidated statement of financial position are
presented below. This does not include fair value information for financial assets and financial liabilities not measured at fair value if the carrying
amount is a reasonable approximation of fair value (ie, cash and cash equivalents; trade and other receivables; trade payables, accruals and other
payables, loans and borrowings).

The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
–

 Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities.

–

 Level 2: inputs other than quoted prices included in Level 1, that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

120

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202118. Fair value measurements and sensitivity analysis (continued)
31 December 2021

In thousands of Pounds Sterling

Financial assets measured at fair value

Investments at FVPL

Derivative financial assets

Financial liabilities measured at fair value

Derivative financial liabilities

31 December 2020

In thousands of Pounds Sterling

Financial assets measured at fair value

Investments at FVPL

Derivative financial assets

Financial liabilities measured at fair value

Derivative financial liabilities

Fair value

Level 1

Level 2

Level 3

Total

–

975,225

–

907

(1,146)

907

(1,146)

Fair value

Level 1

Level 2

Level 3

Total

–

259

(243)

895,674

–

259

(243)

Refer to table presented in note 9 for the reconciliation of the movements in the fair value measurements in level 3 of the fair value hierarchy for
Investments at FVPL.

Investments at FVPL
The Management Board is responsible for carrying out the fair market valuation of the Company’s investments, which it then presents to the
Supervisory Board. The portfolio valuation is carried out on a six-monthly basis as at 30 June and 31 December each year. The portfolio valuation is
reviewed by an independent third-party professional.

The valuation is determined using the discounted cash flow methodology. The cash flow forecasts, generated by each of the underlying assets, are
received by the Company or its subsidiaries, adjusted as appropriate to reflect risks and opportunities, and discounted using asset-specific discount
rates. The portfolio valuation methodology remains unchanged from previous reporting periods.

COVID-19
The portfolio continued its strong performance over the reporting period with no material adverse effect on valuation resulting from COVID-19.
This strong performance is primarily as a result of the Group holding a low-risk, 100 per cent. availability-based portfolio, coupled with strong
stakeholder collaboration during the reporting period. We will continue to work very closely with all stakeholders to help mitigate the risks and
effects of the global pandemic.

Key Portfolio Company and portfolio cash flow assumptions underlying NAV calculation include:
–

The discount rates and the Assumptions as set out below continue to be applicable.

–

– Cash flows from and to the Portfolio Companies are received and made at the times anticipated.

– Non-UK investments are valued in local currency and their cash flows converted to Pounds Sterling at either the period-end exchange rates or

the contract hedge rate.

– Where the operating costs of the Portfolio Companies are fixed by contract, such contracts are performed, and where such costs are not fixed,

they remain within the current forecasts in the valuation models.

– Where lifecycle costs/risks are borne by the Portfolio Companies, they remain in line with the current forecasts in the valuation models.

– Contractual payments to the Portfolio Companies remain on track and contracts with public sector or public sector backed counterparties are

not terminated before their contractual expiry date.

– Any deductions or abatements during the operations period of Portfolio Companies are fully passed down to subcontractors under contractual

arrangements or are part of the planned (lifecycle) forecasts.

– Where the Portfolio Companies own the residual property value in an investment, the projected amount for this value is realised.

–

In cases where the Portfolio Companies have contracts that are in the construction phase, they are either completed on time or any delay costs
are borne by the construction contractors.

Enacted tax or regulatory changes in the future which negatively impact cash flow forecasts are reflected in the financial models.

BBGI Global Infrastructure S.A. | Annual Report 2021

121

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202118. Fair value measurements and sensitivity analysis (continued)
In forming the assessments on the previous page, the Group works with Portfolio Company management teams, as well as using due diligence
information from, or working with, suitably qualified third parties such as technical, legal and insurance advisers.

Macro-economic assumptions
Apart from the discount rates, the Company uses the following assumptions for the cash flows:

Inflation

UK(i) RPI/CPIH

Deposit rates (p.a.)

Corporate tax rates (p.a.)

Canada

Australia

Germany

Netherlands(ii)

Norway(ii)

US(iii)

Canada

Australia

Germany

31 December 2021

2.75% / 2.00%

2.00% / 2.35%

2.50%

2.00%

2.25%

2.50%

31 December 2020

2.75% / 2.00%

2.00% / 2.35%

2.50%

2.00%

2.25%

2.50%

0.00% to Q4 2023, then 1.00%

0.25% to Q4 2023, then 1.00%

0.50% to Q4 2023, then 1.50%

0.75% to Q4 2023, then 1.50%

0.25% to Q4 2023, then 2.00%

0.50% to Q4 2023, then 2.00%

0.00% to Q4 2023, then 0.50%

Netherlands

0.00% to Q4 2023, then 0.50%

Norway

UK(iv)

Canada(v)

Australia

Germany(vi)

Netherlands(vii)

Norway

0.00% to Q4 2023, then 2.00%

0.25% to Q4 2023, then 2.00%

0.00% to Q4 2023, then 1.50%

0.25% to Q4 2023, then 1.50%

19.0% to Q1 2023 then 25.0%

19.0%

23.0% / 26.5% / 27.0% / 29.0%

30.0%

15.8% (incl. solidarity charge)

25.8%

22.0%

21.0%

25.0%

22.0%

21.0%

(i) On the 25 November 2020, the UK Government announced the phasing out of RPI after 2030, and replacement with CPIH; the Company’s UK portfolio indexation factor

changes from RPI to CPIH beginning on 1 January 2031.

Individual tax rates vary among Canadian Provinces: Alberta; Ontario, Quebec, Northwest Territory; Saskatchewan, British Columbia; New Brunswick.
Individual local trade tax rates are considered in addition to the tax rate above.

Discount rate sensitivity
The weighted average discount rate that is applied to the Company’s portfolio of investments is the single most important judgement and variable.

The following table shows the sensitivity of the NAV to a change in the discount rate:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

(78,057)

(73,609)

89,908

85,076

89,908

85,076

+1% to 7.55% in 2021(i)

-1% to 5.55% in 2021(i)

(i) Based on the weighted average discount rate of 6.55 per cent. (31 December 2020: 6.77 per cent.).

122

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202118. Fair value measurements and sensitivity analysis (continued)

Combined Sensitivity: discount, inflation and deposit rates
Inflation has increased in all jurisdictions across BBGI’s geographies and interest rates are expected to rise from its historical lows. In the event long
term interest rates substantially rise this may have an effect on discount rates.

It is reasonable to assume if discount rates increase then deposit rates and inflation rates would increase as well. To illustrate the effect of this
combined movement on the Company’s NAV, a scenario was created assuming a 1 per cent. increase in the discount rate to 7.55 per cent., and a 1
per cent. increase in both deposit and inflation rates above the macro-economic assumptions.

In thousands of Pounds Sterling

31 December 2021

+1%

Equity

Profit or loss

(23,127)

Inflation rate sensitivity
The Company’s investments are contractually entitled to receive availability-based income streams from public sector clients, which are adjusted
every year for inflation. Facilities management subcontractors for accommodation investments and operating and maintenance subcontractors
for transport investments have similar indexation arrangements. The portfolio cash flows are positively correlated with inflation (e.g. RPI, CPI, or a
basket of indices).

The table below shows the sensitivity of the NAV to a change in inflation rates:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

39,499

(32,622)

37,787

(30,983)

+1%

-1%

Foreign exchange rate sensitivity
A significant proportion of the Group’s underlying investments are denominated in currencies other than Pounds Sterling.

The following table shows the sensitivity of the NAV, by applying a change to foreign exchange rates:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

(28,372)

(25,491)

31,140

25,396

31,140

25,396

(i) Sensitivity in comparison to the spot foreign exchange rates at 31 December 2021 and considering the contractual and natural hedges in place, derived by applying a 10 per

cent. increase or decrease to the Pounds Sterling/foreign currency rate.

Increase by 10%(i)

Decrease by 10%(i)

Deposit rate sensitivity
Portfolio Companies typically have cash deposits which are required to be maintained as part of the senior debt funding requirements. (e.g. six
months debt service reserve accounts, maintenance reserve accounts). The asset cash flows are positively correlated with the deposit rates.

The table below shows the sensitivity of the NAV, by applying a change in the long-term deposit rates:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

17,260

17,065

17,260

17,065

(17,151)

(16,641)

(17,151)

(16,641)

+1%

-1%

BBGI Global Infrastructure S.A. | Annual Report 2021

123

Lifecycle costs sensitivity
Lifecycle is the cost of planned interventions or replacing material parts of an asset to maintain it over the concession term. It involves larger
items that are not covered by routine maintenance and for roads it will include items such as replacement of asphalt, rehabilitation of surfaces,
or replacement of electromechanical equipment. Lifecycle obligations, are generally passed down to the facility maintenance provider with the
exception of transportation investments where these obligations are typically retained by the Portfolio Company.

Of the Group’s 54 Investments at FVPL, 19 Investments at FVPL retain the lifecycle obligations. The remaining 35 investments have this obligation
passed down to the subcontractor.

The following table shows the sensitivity of the NAV, by applying a change in lifecycle costs:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

(19,003)

(17,621)

19,580

17,390

19,580

17,390

(i) Sensitivity applied to the 19 investments in the portfolio which retain the lifecycle obligation i.e. the obligation is not passed down to the subcontractor.

Increase by 10%(i)

Decrease by 10%(i)

Corporate tax rate sensitivity
The profits of each portfolio company are subject to corporate tax in the country where that company is located.

The following table shows the sensitivity of the NAV, by applying a change in the corporate tax rates:

Effects in thousands of Pounds Sterling

Equity

Profit or loss

Equity

Profit or loss

31 December 2021

31 December 2020

(8,760)

(6,606)

8,739

6,563

8,739

6,563

+1% in 2021

-1% in 2020

Senior debt refinancing sensitivity
Assumptions are used where a refinancing of senior debt financing is required for an investment during the remaining concession term. There is a
risk that such assumptions may not be achieved.

The following table below shows the sensitivity of the NAV to a +100bps adjustment to the forecasted margins. The base rate for senior debt is
either fixed or a long-term interest swap is available with the effect that none of our investments are subject to changes in base rates.

In thousands of Pounds Sterling

2021

2020

Margin +1%(i)

Equity

Profit or loss

(6,321)

(7,745)

(6,321)

(7,745)

(i) The Northern Territory Secure Facilities (‘NTSF’) asset is the only remaining asset in the Group´s portfolio with refinancing risk.

Derivative financial instruments
The fair value of derivative financial instruments (‘foreign exchange forwards’) is calculated by the difference between the contractual forward rate
and the estimated forward exchange rates at the maturity of the forward contract. The foreign exchange forwards are fair valued periodically by the
counterparty bank. The fair value of derivative financial instruments as of 31 December 2021 amounted to a net liability of £239,000 (31 December
2020: £16,000 – net asset). The counterparty bank has an S&P/Moody’s long-term credit rating of A+/Aa3.

The net loss on the valuation of foreign exchange forwards for the year ended 31 December 2021 amounted to a net loss of £1,797,000
(31 December 2020: £1,495,000 – net loss).

During the year ended 31 December 2021, the Group realised a net loss of £1,540,000 on the cash settlement of foreign exchange forwards
(31 December 2020: £151,000 – realised net loss).

124

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202119. Subsidiaries
During the year ended 31 December 2021, the Company had the following consolidated subsidiaries (‘Holding Companies’ if referred to
individually) which are included in the consolidated financial statements:

Company

BBGI Global Infrastructure S.A.

BBGI Management HoldCo S.à r. l. (‘MHC’)

BBGI Inv, S.à r. l.

BBGI Investments S.C.A.

BBGI Holding Limited

BBGI (NI) Limited

BBGI (NI) 2 Limited

BBGI CanHoldco Inc.

BBGI Guernsey Holding Limited

BBGI Ireland Limited

BBGI US Holding, Inc.

Country of
Incorporation

Luxembourg

Canada

Guernsey

Ireland

Effective
Ownership
Interest

Ultimate
Parent

100.0%

The Company’s subsidiaries which are not consolidated, by virtue of the Company being an Investment Entity, and are accounted for as
Investments at FVPL, are as follows:

Company

Asset Name

RW Health Partnership Holdings Pty Limited

Royal Women’s Hospital

RWH Health Partnership Pty Limited

RWH Finance Pty Limited

Royal Women’s Hospital

Victorian Correctional Infrastructure Partnership

Victoria Correctional Facilities

Pty Limited

Country of
Incorporation

Australia

BBPI Sentinel Holdings Pty Limited

Northern Territory Secure Facilities

Australia

BBPI Sentinel Holding Trust

BBPI Sentinel Pty Limited

BBPI Member Trust

Northern Territory Secure Facilities

Australia

Northern Territory Secure Facilities

Australia

Northern Territory Secure Facilities

Australia

Sentinel Partnership Pty Limited

Northern Territory Secure Facilities

Australia

Effective
Ownership

100.0%

Sentinel UJV

Northern Territory Secure Facilities

Australia

100.0%

Sentinel Financing Holdings Pty Limited

Northern Territory Secure Facilities

Australia

100.0%

Sentinel Financing Pty Limited

Northern Territory Secure Facilities

Australia

100.0%

Sentinel Finance Holding Trust

Northern Territory Secure Facilities

Australia

100.0%

Sentinel Finance Trust

Northern Territory Secure Facilities

Australia

100.0%

Year
Acquired/
Established

2011

2012

2013

2015

2013

2017

2021

Date
Acquired
Controlled

2012

2014

2014 and
2015

BBGI Global Infrastructure S.A. | Annual Report 2021

125

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202119. Subsidiaries (continued)

Company

Asset Name

Country of
Incorporation

BBGI Sentinel Holdings 2 Pty Limited

Northern Territory Secure Facilities

Australia

BBGI Sentinel Holding Trust 2

BBGI Sentinel 2 Pty Limited

BBGI Sentinel Trust 2

BBGI Champlain Holding Inc.

BBGI SSLG Partner Inc.

Golden Crossing Holdings Inc.

Northern Territory Secure Facilities

Australia

Northern Territory Secure Facilities

Australia

Northern Territory Secure Facilities

Australia

Champlain Bridge

Golden Ears Bridge

Canada

Effective
Ownership

100.0%

Golden Crossing Finance Inc.

Golden Ears Bridge

Canada

100.0%

Golden Crossing Inc.

Golden Ears Bridge

Canada

100.0%

Global Infrastructure Limited Partnership

Golden Ears Bridge

Canada

100.0%

Golden Crossing General Partnership

Golden Ears Bridge

Canada

100.0%

BBGI KVH Holdings Inc.

BBGI KVH Inc.

BBGI KVH Holdings 2 Inc.

BBGI KVH 2 Inc.

Kelowna and Vernon Hospitals

Infusion Health KVH General Partnership

Kelowna and Vernon Hospitals

BBGI 104 GP Inc.

WCP Holdings Inc.

WCP Inc.

WCP Investments Inc.

Women’s College Partnership

Stoney Trail Group Holdings Inc.

Stoney Trail LP Inc.

Stoney Trail Investments Inc.

Stoney Trail Inc.

Stoney Trail Global Limited Partnership

Stoney Trail General Partnership

BBGI NCP Holdings Inc.

BBGI Stanton Holdings Inc.

BBGI Stanton Partner 1 Inc.

BBGI Stanton Partner 2 Inc.

Boreal Health Partnership

Highway 104

Women’s College Hospital

Northeast Stoney Trail

North Commuter Parkway

Stanton Territorial Hospital

Canada

100.0%

PJB Beteiligungs-GmbH

Burg Correctional Facility

Germany

100.0%

Projektgesellschaft Justizvollzug Burg

Burg Correctional Facility

Germany

90.0%

GmbH & Co. KG

PJB Management-GmbH

Burg Correctional Facility

Germany

100.0%

Date
Acquired
Controlled

2015

2020

2012 and
2013

2013

2020

2013 and
2020

2020

2013

2015

2018

2020

2018 and
2020

2012

126

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202119. Subsidiaries (continued)

Company

Asset Name

Kreishaus Unna Holding GmbH

Unna Administrative Center

Country of
Incorporation

Germany

Effective
Ownership

100.0%

Projekt- und Betriebsgesellschaft Kreishaus

Unna Administrative Center

Germany

90.0%

Unna mbH

BBGI PPP Investment S.à r.l.

De Groene Schakel Holding B.V.

Holding entity

Westland Town Hall

Luxembourg

Netherlands

100.0%

De Groene Schakel B.V.

Westland Town Hall

Netherlands

100.0%

Noaber18 Holding B.V.

N18 Motorway

Netherlands

52.0%

Noaber18 B.V.

N18 Motorway

Netherlands

52.0%

Agder OPS Vegselskap AS

E18

Norway

100.0%

Bedford Education Partnership Holdings Limited

Bedford Schools

Bedford Education Partnership Limited

Bedford Schools

Lisburn Education Partnership (Holdings) Limited

Lisburn College

Lisburn Education Partnership Limited

Lisburn College

Clackmannanshire Schools Education Partnership

Clackmannanshire Schools

(Holdings) Limited

Clackmannanshire Schools Education

Clackmannanshire Schools

Partnership Limited

Primaria (Barking & Havering) Limited

Barking & Havering Clinics (LIFT)

Barking Dagenham Havering Community

Barking & Havering Clinics (LIFT)

Ventures Limited

Barking & Havering LIFT (Midco) Limited

Barking & Havering Clinics (LIFT)

Barking & Havering LIFT Company (No.1) Limited

Barking & Havering Clinics (LIFT)

Scottish Borders Education Partnership

Scottish Borders Schools

(Holdings) Limited

Scottish Borders Education Partnership Limited

Scottish Borders Schools

Coventry Education Partnership Holdings Limited

Coventry Schools

Coventry Education Partnership Limited

Coventry Schools

Fire Support (SSFR) Holdings Limited

Stoke & Staffs Rescue Service

Fire Support (SSFR) Limited

Stoke & Staffs Rescue Service

Highway Management M80 Topco Limited

Tor Bank School Education Partnership

(Holdings) Limited

M80 Motorway

Tor Bank School

Tor Bank School Education Partnership Limited

Tor Bank School

Mersey Care Development Company 1 Limited

Mersey Care Hospital (LIFT)

MG Bridge Investments Limited

Mersey Gateway Bridge

Lagan College Education Partnership

Lagan College

(Holdings) Limited

Lagan College Education Partnership Limited

Lagan College

100.0%

60.0%

100.0%

85.0%

100.0%

Date
Acquired
Controlled

2012 and
2020

2018

2018 and
2019

2018, 2019
and 2020

2013 and
2014

2012

2013

2013 and
2014

2014

BBGI Global Infrastructure S.A. | Annual Report 2021

127

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021Effective
Ownership

100.0%

99.0%

100.0%

66.67%

Date
Acquired
Controlled

2014

2012, 2014
and 2018

2012 and
2018

2014

2014, 2015
and 2016

2015

2016

2021

2014

2014 and
2019

19. Subsidiaries (continued)

Company

Asset Name

Highway Management (City) Holding Limited

M1 Westlink

GB Consortium 1 Limited

North London Estates Partnership
(LIFT) and Liverpool and Sefton
Clinics (LIFT)

East Down Education Partnership (Holdings) Limited

East Down Colleges

East Down Education Partnership Limited

East Down Colleges

Highway Management (City) Finance Plc

Highway Management (City) Limited

M1 Westlink

Blue Light Partnership (ASP) NewCo Limited

Avon and Somerset Police HQ

Blue Light Partnership (ASP) Holdings Limited

Avon and Somerset Police HQ

Blue Light Partnership (ASP) NewCo 2 Limited

Avon and Somerset Police HQ

GT ASP Limited

Avon and Somerset Police HQ

Blue Light Partnership (ASP) Limited

Avon and Somerset Police HQ

Northwin Limited

North West Regional College

Northwin (Intermediate) (Belfast) Limited

Belfast Metropolitan College

Country of
Incorporation

Northwin (Belfast) Limited

Folera TH Holdings Limited

Folera Limited

Belfast Metropolitan College

Poplar Affordable Housing &

Jersey

Recreational Centres

Poplar Affordable Housing &

Jersey

Recreational Centres

Woodland View Holdings Co Limited

Ayrshire and Arran Hospital

Woodland View Intermediate Co Limited

Ayrshire and Arran Hospital

Woodland View Project Co Limited

Ayrshire and Arran Hospital

Fire and Rescue NW Holdings Limited

North West Fire and Rescue

Fire and Rescue NW Intermediate Limited

North West Fire and Rescue

Fire and Rescue NW Limited

BBGI East End Holdings Inc.

East End Crossings Partners, LLC

North West Fire and Rescue

Ohio River Bridges

128

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202120. Related parties and key contracts
All transactions with related parties were undertaken on an arm’s length basis.

Supervisory Board fees
The members of the Supervisory Board of the Company were entitled to total fees of £220,000 for the year ended 31 December 2021 (2020:
£209,000).

Directors’ shareholding in the Company

In thousands of shares

Management Board

Duncan Ball

Frank Schramm

Michael Denny

Supervisory Board

Sarah Whitney

Christopher Waples

31 December
2021

31 December
2020

636

600

412

548

500

262

–

1,704

1,349

Remuneration of the Management Board
Under the current remuneration programme, all staff are entitled to an annual base salary payable monthly in arrears, which is reviewed annually
by the Management Board. The Management Board members are entitled to a fixed remuneration under their contracts and are also entitled
to participate in a short-term incentive plan and a long-term incentive plan. Compensation under their contracts is reviewed annually by the
Remuneration Committee.

The total short-term and other long-term benefits recorded in the consolidated income statement for the Management Board, as the key
management personnel, are as follows:

In thousands of Pounds Sterling

Short-term benefits

Share-based payment

Year ended
31 December
2021

Year ended
31 December
2020

2,769

1,224

3,993

2,717

953

3,670

Share-based compensation
Each of the members of the Management Board received award letters (‘2020 Award’, ‘2019 Award’, and ‘2018 Award’, respectively) under the
Group’s long-term incentive plan. These awards are to be settled by MHC in the Company’s own shares. The awards granted vests by reference to
one or a combination of performance measures linked to the Company’s Total Shareholder Return (‘TSR condition’) and/or on the increase in the
Company’s Investment Basis NAV per share (‘NAV condition’) over the Return Periods. Further details are as follows:

Return Period

Vesting period (by reference to performance measure
– 100% NAV condition for 2020 Award and 50% NAV
and 50% TSR condition for 2019 and 2018 Award)

2020 Award

2019 Award

2018 Award

December 2020-
December 2023

36 mos. Ending
31/12/2023

December 2019-
December 2022

36 mos. Ending
31/12/2022

December 2018-
December 2021

36 mos. Ending
31/12/2021

Maximum number of shares which will vest

1,456,759

757,893

820,189

BBGI Global Infrastructure S.A. | Annual Report 2021

129

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021
20. Related parties and key contracts (continued)

Share-based compensation (continued)
For 2021 awards, 90 per cent. of the performance target will be subject to stretching Net Asset Value (‘NAV’) Total Return targets. NAV Total Return
reflects both capital returns generated and dividends returned to shareholders.

10 per cent. of the award will be subject to a reduction in corporate GHG emissions (Scope 1, 2 & 3) (against a 2019 baseline), a key climate related
ESG metric linked to BBGI’s Net Zero Plan.

The fair value of the equity instruments awarded to the Management Board was determined using the following key parameters:

Share price at grant date

Maturity

Annual target dividend (2023)

Annual target dividend (2020)

Annual target dividends (2021 to 2022)

Annual target dividends (2019 to 2021)

Volatility

Risk free rate

2020 Award

£ 1.700

3 years

£0.0733

–

£0.0733

–

n/a

2019 Award

2018 Award

£ 1.675

3 years

–

£0.0718

£0.0733

–

11%

£ 1.565

3 years

–

£0.0700

11%

Between
-0.11% and -0.05%

Between
0.53% and 0.60%

Between
0.75% and 0.79%

The expected volatility under the 2019 and 2018 awards reflects the assumption that the historical volatility over a period similar to the life of the
plan is indicative of future trends, which may not necessarily be the actual outcome.

The Group has issued restricted share awards to selected employees. The restricted share award entitles the employee to a right to receive shares
in the Company upon meeting a service condition.

The fair value of the awards and amounts recognised as additional paid in capital in the Group’s consolidated statement of financial position are
as follows:

In thousands of Pounds Sterling

2020 Award

2019 Award

2018 Award

2017 Award

Deferred STIP

Staff Award Plan

Amount recognised in additional paid-in capital

31 December
2021

31 December
2020

345

297

472

–

616

103

1,833

–

148

315

402

627

1,517

During the year ended 31 December 2021, the Company settled the outstanding obligation under the 2017 Award through (a) issuance of
730,785 shares at 167.8 pence per share. The total accrued amount under the 2017 Award as at 31 December 2020 was £402,000. This amount
was transferred from Additional paid in capital to Share capital at the settlement date plus an adjustment of £25,000 for the non-market based
performance condition.

130

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021

20. Related parties and key contracts (continued)

Share-based compensation (continued)
The share-based compensation expenses amount recognised as part of ‘administrative expenses’ in the Group’s consolidated income statement
are as follows:

In thousands of Pounds Sterling

2020 Award

2019 Award

2018 Award

2017 Award

2016 Award

Deferred STIP

Staff Award Plan

Amount recognised in administrative expenses

Year ended
31 December
2021

Year ended
31 December
2020

345

148

157

–

607

1,361

–

148

157

134

(114)

627

977

In December 2021, each of the members of the Management Board received an award letter (‘2021 Award’). The maximum number of shares that
could be issued under this award was determined by using the closing price of the Company’s share price on 23 December 2021, as ascertained
from the Official List, which was 176.00 pence per share. Subject to the achievement of the performance conditions, the awards will vest after
21 December 2024.

Deferred STIP
Commencing in 2020, the Company introduced a bonus deferral under the STIP with one-third of any bonus earned being deferred into shares for
three year holding period. The deferral component of the STIP differs from the Company’s share-based compensation in that there are no further
vesting conditions on this earned bonus.

The Deferred STIP is valued at 33.3% of the outcome of the annual bonus plan for the Management Board. The total value of the Deferred STIP as
at 31 December 2021 was £616,000 (31 December 2020: £627,000).

Trade and other receivables
As at 31 December 2021, trade and other receivables include short-term receivables from non-consolidated subsidiaries amounting to £1,024,000
(2020: £1,631,000).

21. Commitments and contingencies
The Group has engaged, in the ordinary course of business, the services of certain entities to provide legal, custodian, audit, tax and other services
to the Company. The expenses incurred in relation to such are treated as legal and professional fees under the administrative expenses grouping
in the consolidated income statement.

As at 31 December 2021, the Group had utilised £1.2 million (31 December 2020: £1.2 million) of the £230 million RCF to cover letters of credit.
Refer to Note 15 for further details on the RCF.

MHC leases its current office under a cancellable operating lease agreement. The expenses incurred in relation to such are recognised as office
and other expenses under administrative expenses (see Note 6).

BBGI Global Infrastructure S.A. | Annual Report 2021

131

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202122. Service Concession Agreements
As at 31 December 2021, the Group has a portfolio of 54 assets (see also Note 9), with a weighted average remaining concession length of 20.3
years. The Group has a diverse asset mix from which the service concession receivables are derived. All assets are availability-based. The rights of
both the concession provider and concession operator are stated within the specific asset agreement.

The following table summarises the main information about the Group’s outstanding service concession agreements, which are all classified as
availability-based social infrastructure:

Period of Concession
(Operational Phase)

Asset Name

Kicking Horse

Canyon

% Equity
Owned

Short Description of Concession Arrangement

Phase

Start Date

End Date

50.0% Design, build, finance and operate a 26-km stretch of the Trans-
Canada Highway, a vital gateway to British Columbia.

Operational September

2007

October
2030

Golden Ears Bridge

100.0% Design, build, finance and operate the Golden Ears Bridge that

Operational

June 2009

June 2041

spans the Fraser River and connects Maple Ridge and Pitt Meadows
to Langley and Surrey, near Vancouver, British Columbia.

Northwest Anthony

50.0% Partly design, build, finance and operate a major transport

Operational November

Henday Drive

infrastructure asset in Canada, a ring road through Edmonton,
capital of the province of Alberta.

2011

October
2041

M80 Motorway

50.0% Design, build, finance and operate 18 km of dual two/three lane

Operational

July 2011

September

motorway with associated slip roads and infrastructure from Stepps
in North Lanarkshire to Haggs in Falkirk (Scotland).

2041

E18 Motorway

Northeast

Stoney Trail

100.0% Design, build, finance, operate and maintain a 38 km dual carriageway
in Norway, including 75 bridges and structures and 75 km of
secondary roads, carving through a rugged and beautiful landscape
between Grimstad and Kristiansand.

Operational August
2009

August
2034

100.0% Design, build, finance, operate and maintain a 21 km section

Operational November

of highway, forming part of a larger ring road developed in
Calgary, Alberta, Canada.

2009

October
2039

Ohio River Bridges

66.67% Design, build, finance, operate and maintain East End Bridge asset

Operational December

December

Mersey Gateway

37.5%

Bridge

which includes a cable-stay bridge, a tunnel and the connecting
highway with a total length of 8 miles crossing the Ohio river in
the greater Louisville-Southern Indiana region.

Design, build, finance, operate and maintain a new circa 1-km long
six-lane toll cable-stay bridge (three towers) over the Mersey
river to relieve the congested and ageing Silver Jubilee Bridge
and upgrading works for 9.5 km of existing roads and associated
structures.

2016

2051

Operational October

2017

March
2044

M1 Westlink

100.0% Design, build, finance, operate and maintain with significant amount
of construction work completed in 2009 to upgrade key sections of
approx. 60 km of motorway through Belfast and its vicinity, including
O&M of the complete motorway.

Operational February

2006

October
2036

North Commuter

50.0% Design, build, finance, operate and maintain two new arterial

Operational October 2018 September

Parkway

Canada Line

26.7%

roadways and a new river crossing located in the north area of
Saskatoon, Saskatchewan, Canada, and design, construct, finance,
operate and maintain a replacement river crossing located in
Saskatoon’s downtown core.

Design, build, finance, operate and maintain a 19km rapid transit line
connecting the cities of Vancouver and Richmond with Vancouver
International Airport in British Columbia, Canada.

2048

Operational August 2009 July 2040

Southeast Stoney

40.0% Design, build, finance, operate and maintain a 25km section

Operational November

September

Trail

of highway, forming part of a larger ring road developed in
Calgary, Alberta, Canada.

2013

2043

William R. Bennett

80.0% Design, build, finance, operate and maintain a 1.1km long floating

Operational May 2008

June 2035

Bridge

bridge in Kelowna, British Columbia, Canada.

A1/A6 Motorway

37.14% Design, build, finance operate and maintain the enlargement of the

Operational

July 2017

June 2042

A1/A6 in the Netherlands, which involves the reconstruction and
widening of this 2x5 lanes motorway plus 2 reversible direction
lanes. The asset involves some 90 engineering structures.

132

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202122. Service Concession Agreements (continued)

Asset Name

% Equity
Owned

Short Description of Concession Arrangement

Phase

Start Date

End Date

N18 Motorway

52.0% Design, build, finance operate and maintain the extension of the N18

Operational April 2018

April 2043

Period of Concession
(Operational Phase)

Highway 104

50%

Champlain Bridge

25%

motorway between Varsseveld and Enschede in the eastern part of
the Netherlands. It comprises of 15 km of existing and 27km of a new
2x2-lane motorway with more than 30 ecological passages, aiming
at a reduction in traffic in certain villages and safety improvement.

Design, build, finance, operate and maintain PPP following
completion of construction. The project consists of the construction
of a four-lane divided highway corridor beginning at the end of
the existing divided highway east of New Glasgow near Exit 27 at
Sutherlands River and running for a distance of approximately 38km
to the existing divided highway just west of the Addington Fork
Interchange (Exit 31) at Antigonish.

Design, construction, financing, operation, maintenance and
rehabilitation of a new bridge spanning the St. Lawrence River
between Montreal and Brossard, Quebec.

Construction May 2020

August
2043

Operational December

2020

October
2049

Victoria

Correctional
Facilities

100.0% Design, build, finance, operate, and maintain for a period of 25 years,

Operational March 2006

May 2031

two new correctional facilities for the State of Victoria, Australia
(MCC and MRC).

(MRC)/
February
2006
(MCC)

Burg

Correctional
Facility

90.0% Design, build, finance, operate, and maintain for a concession period
of 25 years, a new correctional facility for the state of Saxony-Anhalt,
Germany.

Operational May 2009

April 2034

Avon and Somerset

100.0% Design, build, finance, operate and maintain four new build police

Operational

July 2014/July

Police HQ

and custody facilities in the Avon and Somerset region (UK).

2015

March
2039

Northern Territory
Secure Facilities

100.0% Design, build, finance, operate and maintain a new correctional

Operational November

June 2044

facility, located near Darwin, including three separate centres of the
1,048 bed multi-classification men’s and women’s correctional centre
and 24-bed Complex Behaviour Unit.

2014

Bedford Schools

100.0% Design, build, finance, operate and maintain the redevelopment
of two secondary schools in the County of Bedfordshire.

Operational

June 2006

December

Coventry Schools

100.0% Design, build, finance, operate and maintain one new school

Operational

and community facilities for the Coventry City Council.

2035

December

2034

In stages from
March 2006
to June
2009

Kent Schools

50.0% Design, build, finance, operate and maintain the redevelopment,
which included the construction of new build elements for each
academy as well as extensive reconfiguration and refurbishment of
six academies.

Operational

June 2007

September

2035

Scottish Borders

100.0% Design, build, finance, operate and maintain three new

Operational

July 2009

November

Schools

secondary schools for Scottish Borders Council.

Clackmannanshire

100.0% Design, build, finance, operate and maintain the redevelopment

Operational

Schools

of three secondary schools in Clackmannanshire, Scotland.

2038

March
2039

In stages from
January to
May 2009

East Down
Colleges

100.0% Design, build, finance, operate and maintain the three East Down

Operational

June 2009

May 2036

Colleges campuses in Northern Ireland

Lisburn College

100.0% Design, build, finance, operate and maintain Lisburn College in

Operational April 2010

May 2036

Northern Ireland.

Tor Bank School

100.0% Design, build, finance, operate and maintain a new school for

Operational October 2012 October

pupils with special education needs in Northern Ireland.

2037

Lagan College

100.0% Design, build, finance operate and maintain the redevelopment

Operational October 2013 June 2038

of Lagan College in Northern Ireland.

BBGI Global Infrastructure S.A. | Annual Report 2021

133

Asset Name

% Equity
Owned

Short Description of Concession Arrangement

Phase

Start Date

End Date

Cologne Schools

50.0% Design, build, finance operate and maintain the redevelopment of

Operational April 2005

December

five schools in Cologne.

2029

Rodenkirchen

50.0% Design, build, finance operate and maintain a school for approx.

Operational November

November

Schools

1200 pupils in Cologne.

2007

2034

Frankfurt Schools

50.0% Design, build, finance operate and maintain the redevelopment

Operational August 2007

July 2029

of four schools in Frankfurt.

North West

100.0% Design, build, finance, operate and maintain the North West

Operational February 2001 January

Period of Concession
(Operational Phase)

Regional College

Regional College educational campus in Northern Ireland

Belfast Metropolitan

100.0% Design, build, finance, operate and maintain the Belfast

Operational September

Metropolitan educational campus in Northern Ireland

2002

2026

August
2027

100.0% Design, build, finance, operate and maintain Westland Town Hall,

a PPP accommodation asset consisting of a new approximately
11,000m2 town hall for the Dutch Municipality of Westland.

Operational August 2017 August
2042

50.0% Design, build, finance, operate and maintain a hospital scheme

Operational April 2005

in Gloucester, UK.

60.0% Design, build, finance, operate and maintain the primary
healthcare facilities in Liverpool and Sefton, UK.

Operational

College

Westland
Town Hall

Gloucester

Royal Hospital

Liverpool and

Sefton Clinics
(LIFT)

North London

60.0% Design, build, finance, operate and maintain the primary healthcare

Operational

Estates Partnership
(LIFT)

facilities of the Barnet, Enfield and Haringey LIFT programme, UK.

Barking Dagenham
Havering (LIFT)

60.0% Design, build, finance, operate and maintain 10 facilities/clinics in

Operational

East London, UK with asset construction completions between
2005 and 2009.

February
2034

In 7 tranches
starting
April 2033
and ending
February
2043

In 4 tranches
starting
October
2030 and
ending
June 2043

In 3 tranches
starting
September
2030 and
ending
September
2033

In 7 tranches
starting
April 2005
and ending
February
2013

In 4 tranches
starting
February
2006 and
ending
June 2013

In 3 tranches
starting
October
2005 and
ending
October
2008

Royal Women’s

100.0% Design, build, finance, operate and maintain a new nine-storey

Operational

June 2008

June 2033

Hospital

Royal Women’s Hospital in Melbourne.

Mersey Care Hospital
(part of Liverpool
Sefton Clinics
(LIFT) above)

79.6%

Design, build, finance, operate and maintain a new mental health
in-patient facility on the former Walton hospital site in Liverpool, UK.

Operational December

December

2014

2044

Kelowna and

100.0% Design, build, finance, operate and maintain a new Patient Care

Operational

Vernon Hospital

Tower, a new University of British Columbia Okanagan Clinical
Academic Campus and car park at Kelowna General Hospital, and a
new Patient Care Tower at Vernon Jubilee Hospital.

January 2012 August
2042

Women’s

100.0% Design, build, finance, operate and maintain the new Women’s

Operational May 2013

May 2043

College Hospital

College Hospital in Toronto, Ontario, Canada.

(Phase 1),
September
2015 (Phase
2), March
2016 (final
completion).

Restigouche

Hospital Centre

80.0% Design, build, finance, operate and maintain the new Psychiatric
Care Centre in Restigouche, New Brunswick, Canada.

Operational

June 2015

October
2044

134

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 202122. Service Concession Agreements (continued)

2044

October
2048

October
2036

2047

March
2041

Asset Name

McGill University
Health Centre

% Equity
Owned

Short Description of Concession Arrangement

Phase

Start Date

End Date

40.0% Design, build, finance, operate and maintain the new McGill

Operational October 2014 September

Period of Concession
(Operational Phase)

University Health Centre, Montreal, Canada.

Stanton Territorial

Hospital

100.0% Design, build, finance, operate and maintain the new Stanton
Territorial Hospital, Yellowknife, Northwest Territories, Canada.

Operational December

2018

Stoke & Staffs

Rescue Service

85.0% Design, build, finance, operate and maintain 10 new community
fire stations in Stoke-on-Trent and Staffordshire, UK.

Operational November

2011

Unna Administrative

90.0% Design, build, finance, operate and maintain the administration

Operational

July 2006

July 2031

Centre

Fürst Wrede

Military Base

building of the Unna District in Rhine-Westphalia, Germany.

50.0% Design, build, finance, operate and maintain the refurbishment and

new construction of a 32 hectare army barracks in Munich, Germany.

Operational March
2008

March
2028

Poplar Affordable

100.0% Design, construction, financing, operation, maintenance and

Operational October 2015 July 2051

Housing &
Recreational
Centres

rehabilitation of separate buildings.

Aberdeen Western
Peripheral Route

33.3%

Design, construction, financing, operations and maintenance of
12 km of the existing roadway (upgraded) and 47 km of new dual
carriageway including two significant river crossings.

Operational May 2018

November

Ayrshire and

Arran Hospital

100.0% Design, construction, financing and maintenance of a 206-bed

acute mental health facility and community hospital in Irvine, North
Ayrshire, Scotland.

Operational March
2016

North West Fire
and Rescue

100.0% Design, construction, financing, maintenance and rehabilitation
of 16 new community fire stations in the North West of England.

Operational

June 2013

July 2038

23. Standards issued but not yet effective
A number of new standards and amendments to standards are effective for annual periods beginning after 1 January 2022 and earlier application is
permitted; however, the Group has not early adopted any of the forthcoming new or amended standards in preparing these consolidated financial
statements. The Group intends to adopt these new and amended standards, if applicable, when they become effective.

The adoption of the below new standards, which are of relevance to the Company, are not expected to have a significant impact on the Group’s
consolidated financial statements.

Reference to the Conceptual Framework – Amendments to IFRS 3
In May 2020, the IASB issued Amendments to IFRS 3 Business Combinations - Reference to the Conceptual Framework for Financial Reporting
and add an exception for the recognition of liabilities and contingent liabilities within the scope of IAS 37 Provisions, Contingent Liabilities
and Contingent Assets and Interpretation 21 Levies. The amendments also confirm that contingent assets should not be recognised at the
acquisition date.

Onerous Contracts – Costs of Fulfilling a Contract – Amendments to IAS 37
In May 2020, the IASB issued amendments to IAS 37 to specify which costs an entity needs to include when assessing whether a contract is
onerous or loss-making.

The amendments apply a “directly related cost approach”. The costs that relate directly to a contract to provide
goods or services include both incremental costs and an allocation of costs directly related to contract activities. General and administrative costs
do not relate directly to a contract and are excluded unless they are explicitly chargeable to the counterparty under the contract. The amendments
are effective for annual reporting periods beginning on or after 1 January 2022.

BBGI Global Infrastructure S.A. | Annual Report 2021

135

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Consolidated Financial Statement continuedFor the year ended 31 December 202123. Standards issued but not yet effective (continued)

IFRS 9 Financial Instruments – Fees in the ’10 per cent.’ test for derecognition of financial liabilities
As part of its 2018-2020 annual improvements to IFRS standards process the IASB issued amendment to IFRS 9. The amendment clarifies the
fees that an entity includes when assessing whether the terms of a new or modified financial liability are substantially different from the terms of
the original financial liability. These fees include only those paid or received between the borrower and the lender, including fees paid or received
by either the borrower or lender on the other’s behalf. An entity applies the amendment to financial liabilities that are modified or exchanged on or
after the beginning of the annual reporting period in which the entity first applies the amendment.

The amendment is effective for annual reporting periods beginning on or after 1 January 2022 with earlier adoption permitted. The Group will apply
the amendments to financial liabilities that are modified or exchanged on or after the beginning of the annual reporting period in which the entity
first applies the amendment.

24. Events after the end of the reporting period

New Acquisition
John Hart Generating Station Replacement Project (Canada): In February 2022, BBGI completed the acquisition of an investment in InPower
BC General Partnership, the entity responsible for delivering the John Hart Generating Station Replacement Project (‘John Hart Generating
Station’), an investment delivered through the existing strategic partnership between the Company and SNC-Lavalin Group Inc. The PPP
consisted of the design, construction, financing, maintenance and rehabilitation of a new three-turbine, 132-MW hydroelectric power generation
station on the Campbell River, British Columbia, including a 3 generating unit underground powerhouse, 2.1 kilometres of water passage tunnels
and a water bypass system to protect downstream fish habitat. The acquisition price was approximately £24 million.

Service commencement was achieved in 2019 and the concession runs until 2033. The asset is classified as availability-based under the investment
policy of the Company. The investment is not subject to demand or power price risk. Availability payments are received from the British Columbia
Hydro & Power Authority (rated AA / Aaa by DBRS Morningstar and Moody’s respectively) a Crown corporation wholly owned by the Government
of British Columbia.

Dividend declaration
In February 2022, the Company declared a 2nd interim dividend of 3.665 pence per share with scrip alternative for qualifying shareholders for the
period 1 July – 31 December 2021. The dividend is expected to be paid in April 2022.

136

BBGI Global Infrastructure S.A. | Annual Report 2021

Notes to the Consolidated Financial Statement continuedFor the year ended 31 December 2021Report on the audit of the financial statements

To the Shareholders of
BBGI Global Infrastructure S.A.
6E, route de Trèves
L-2633 Senningerberg Luxembourg

Report of the reviseur d’entreprises agree

Opinion
We have audited the financial statements of BBGI Global Infrastructure S.A. (the “Company”), which comprise the statement of financial position as
at 31 December 2021, and the statement of comprehensive income, statement of changes in equity and statement of cash flows for the year then
ended, and notes to the financial statements, including a summary of significant accounting policies.

In our opinion, the accompanying financial statements give a true and fair view of the financial position of the Company as at 31 December 2021 and
of its financial performance and its cash flows for the year then ended in accordance with International Financial Reporting Standards as adopted
by the European Union (“IFRSs”).

Basis for opinion
We conducted our audit in accordance with the Law of 23 July 2016 on the audit profession (“Law of 23 July 2016”) and with International Standards
on Auditing (“ISAs”) as adopted for Luxembourg by the “Commission de Surveillance du Secteur Financier” (“CSSF”). Our responsibilities under
the Law of 23 July 2016 and ISAs are further described in the « Responsibilities of the “réviseur d’entreprises agréé” for the audit of the financial
statements » section of our report. We are also independent of the Company in accordance with the International Ethics Standards Board for
Accountants’ Code of Ethics for Professional Accountants (“IESBA Code”) as adopted for Luxembourg by the CSSF together with the ethical
requirements that are relevant to our audit of the financial statements, and have fulfilled our other ethical responsibilities under those ethical
requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the financial statements of the
current period. These matters were addressed in the context of the audit of the financial statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

Impairment of investment in subsidiary and loans receivable from subsidiaries

a) Why the matter was considered to be one of most significance in our audit of the financial statements of the current period?
We refer to the accounting policy for “Impairment testing for investments” and to Note 13 and 14 in the financial statements. 97% of the Company’s
total assets are investment in subsidiary and loans receivable from subsidiaries subject to an impairment assessment at each reporting date.

The conclusion whether there is objective evidence of impairment on investment in subsidiary and loans receivable from subsidiaries is a significant
judgement area resulting from a number of assumptions in the financial models. The valuation is inherently subjective due to the absence of a
liquid market for these investments, and the fact that their fair value is determined using the fair value of the underlying infrastructure investments
which, in turn, is determined using a discounted cash flow methodology applied by the Management Board. The complexity of this methodology as
well as assumptions taken in the financial models mean that there is a risk that the fair value of these investments may not be appropriate. The key
assumptions used by the Management Board are in respect of discount rates and components of budgets used being part of long term forecast
cash flows. In addition, the Management Board also used key macroeconomic assumptions such as inflation, deposit interest and tax rates that
have an impact on the long term forecast cash flows.

As for the loans receivable from subsidiaries, valuation of the underlying investments is an important consideration in the determination of
expected credit losses (ECL). The significance of the estimates and judgements involved, coupled with the fact that a small percentage difference
in the key assumptions used in the valuation of loans receivables from subsidiaries and in the impairment assessment of loans receivable from
subsidiaries, when aggregated, could result in a material misstatement on the statement of comprehensive income and statement of financial
position, warrants specific audit focus in this area.

b) How the matter was addressed in our audit
Our audit procedures to determine if there is any impairment of investment in subsidiary and loans receivable from subsidiaries consist of the
analysis of the valuation of the underlying infrastructure assets that have been developed predominantly under PPP/PFI or similar procurements
models (“Infrastructure Investments”) and of ECL, as appropriate, which included, but were not limited to the following:
– We tested the design and implementation of the management review controls over the valuation process;

– We involved KPMG valuation specialists and their market knowledge to perform the following procedures:

– We considered and commented the approach and methodology documented by Management Board used in Company’s Valuation Report

against International Private Equity and Venture Capital Valuation Guidelines;

– We obtained market benchmarks for discount rates from public and private sources. We considered the discount rates applied in

Company’s Valuation Report against market benchmarks in the light of market, project, sector and country issues;

BBGI Global Infrastructure S.A. | Annual Report 2021

137

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEReport on the audit of the financial statements continued

– We performed research on key assumptions and commented and compared those against the assumptions applied in Company’s

Valuation Report;

– We reviewed the results of the sensitivity analysis on key assumptions taken by Management;

– We challenged and determined the appropriateness of the Management Board’s assumptions used for the valuation of a sample of

Infrastructure Investments applying following procedures:
– We considered if the methodology for assessing fair value has been applied consistently across the assets;

– We read the latest board minutes, board packages and other supporting documents and information in respect of the sampled

investments and raised Q&A comments to challenge the inputs in the valuation;

– We determined the appropriateness of the changes in the cash-flows inputs (such as dividends, subordinated debt interest and principal

repayment and director’s fees) used for the valuation of Infrastructure Investments;

– We reviewed the Valuation Report prepared by the Management Board and assessed whether the valuation inputs and results are consistent

with our other audit procedures performed as part of our audit of the consolidated financial statements;

– We obtained and reviewed the valuation review opinion issued by the independent third party valuation expert engaged by the Company, in

connection with the appropriateness of the portfolio value prepared by the Management Board;

– We gained an understanding of the process and controls that management has established to identify, account for and disclose loans from

subsidiaries and to authorize and approve significant transactions and arrangements with related parties.

– We verified whether the Company’s investment in subsidiary and loans receivables from subsidiaries are carried at more than their recoverable

amount (fair value determined) and assessed that there are no external or internal indicators of impairment.

– We obtained the management impairment analysis by the Management Board on the impairment of investment in subsidiary and loans

receivable from subsidiaries and performed the following procedures:
– We challenged the criteria and inputs used in the impairment analysis;

– We performed an overall assessment of the assumptions and models used to calculate the ECL; and

– We performed impairment testing of non-financial assets (investment in subsidiary).

Other information
The Management Board is responsible for the other information. The other information comprises the information stated in the annual report but
does not include the financial statements and our report of “réviseur d’entreprises agréé” thereon.

Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether
the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be
materially misstated. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are
required to report this fact. We have nothing to report in this regard.

Responsibilities of the Management Board for the financial statements
The Management Board is responsible for the preparation and fair presentation of the financial statements in accordance with IFRSs, and for such
internal control as the Management Board determines is necessary to enable the preparation of financial statements that are free from material
misstatement, whether due to fraud or error.

In preparing the financial statements, the Management Board is responsible for assessing the Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the Management Board either
intends to liquidate the Company or to cease operations, or has no realistic alternative but to do so.

Responsibilities of the réviseur d’entreprises agréé for the audit of the financial statements
The objectives of our audit are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue a report of the “réviseur d’entreprises agréé” that includes our opinion. Reasonable
assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with the Law of 23 July 2016 and with ISAs as
adopted for Luxembourg by the CSSF will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are
considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on
the basis of these financial statements.

138

BBGI Global Infrastructure S.A. | Annual Report 2021

Report on the audit of the financial statements continued

Identify and assess the risks of material misstatement of the financial statements, whether due to fraud or error, design and perform audit
procedures responsive to those risks, and obtain audit evidence that is sufficient and appropriate to provide a basis for our opinion. The risk of
not detecting a material misstatement resulting from fraud is higher than for one resulting from error, as fraud may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of internal control.

– Obtain an understanding of internal control relevant to the audit in order to design audit procedures that are appropriate in the circumstances,

but not for the purpose of expressing an opinion on the effectiveness of the Company’s internal control.

–

Evaluate the appropriateness of accounting policies used and the reasonableness of accounting estimates and related disclosures made by the
Management Board.

– Conclude on the appropriateness of the Management Board’s use of the going concern basis of accounting and, based on the audit evidence
obtained, whether a material uncertainty exists related to events or conditions that may cast significant doubt on the Company’s ability to
continue as a going concern. If we conclude that a material uncertainty exists, we are required to draw attention in our report of the “réviseur
d’entreprises agréé” to the related disclosures in the financial statements or, if such disclosures are inadequate, to modify our opinion. Our
conclusions are based on the audit evidence obtained up to the date of our report of the “réviseur d’entreprises agréé”. However, future events
or conditions may cause the Company to cease to continue as a going concern.

–

Evaluate the overall presentation, structure and content of the financial statements, including the disclosures, and whether the financial
statements represent the underlying transactions and events in a manner that achieves fair presentation.

From the matters communicated with those charged with governance, we determine those matters that were of most significance in the audit
of the financial statements of the current period and are therefore the key audit matters. We describe these matters in our report unless law or
regulation precludes public disclosure about the matter.

Report on other legal and regulatory requirements
We have been appointed as “réviseur d’entreprises agréé” by the Shareholders on 30 April 2021 and the duration of our uninterrupted
engagement, including previous renewals and reappointments, is eleven years.

The management report is consistent with the financial statements and has been prepared in accordance with the applicable legal requirements.

Luxembourg, 30 March 2022
KPMG Luxembourg Société anonyme
Cabinet de révision agréé

Joseph de Souza

BBGI Global Infrastructure S.A. | Annual Report 2021

139

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCE
Company Statement of Comprehensive Income

For the year ended 31 December 2021

In thousands of Pounds Sterling

Administrative expenses

Other operating expenses

Other operating income

Results from operating activities

Net finance result

Profit (loss) before tax

Tax expense

Profit (loss) from continuing operations

Profit (loss) from continuing operations attributable to owners of the Company

Other comprehensive income for the year

Notes

2021

2020

(9,498)

(12,611)

–

(22,109)

20,118

(1,991)

(459)

(2,450)

–

(9,001)

(2,721)

5,181

(6,541)

18,773

12,232

(427)

11,805

–

Total comprehensive income (loss) for the year attributable to owners of the Company

(2,450)

11,805

The accompanying notes form an integral part of the Company’s financial statements

140

BBGI Global Infrastructure S.A. | Annual Report 2021

Company Statement of Financial Position

As at 31 December 2021

In thousands of Pounds Sterling

Assets

Property and equipment

Loans receivable from subsidiaries

Investment in subsidiary

Non-current assets

Loans receivable from subsidiaries

Interest and other receivables from subsidiaries

Other current assets

Cash and cash equivalents

Current assets

Total assets

Equity

Share capital

Retained earnings

Equity attributable to owners of the Company

Liabilities

Trade and other payables

Advances from subsidiary

Current tax liabilities

Current liabilities

Total liabilities

Total equity and liabilities

Net asset value attributable to the owners of the Company

Net asset value per ordinary share (pence)

The accompanying notes form an integral part of the Company’s financial statements.

Notes

2021

2020

–

243,638

217,182

350,453

333,048

594,098

550,230

91,968

8,760

325

11,311

112,364

706,462

94,784

14,325

256

5,636

115,001

665,231

850,355

772,640

(161,124)

(108,743)

689,231

663,897

1,125

15,990

116

17,231

1,232

–

102

1,334

706,462

665,231

689,231

663,897

96.78

99.88

BBGI Global Infrastructure S.A. | Annual Report 2021

141

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCECompany Statement of Changes in Equity

For the year ended 31 December 2021

In thousands of Pounds Sterling

Balance at 1 January 2020

Total comprehensive income for the year attributable to the owners of

the Company

Transactions with the owners of the Company, recognised directly in equity

Issuance of shares from placing of ordinary shares net of issue cost

Cash dividends

Scrip dividends

Shares issued on behalf of a subsidiary

Balance at 31 December 2020

Total comprehensive loss for the year attributable to the owners of the Company

Transactions with the owners of the Company, recognised directly in in equity

Issuance of shares from placing of ordinary shares net of issue cost

Cash dividends

Scrip dividends

Shares issued on behalf of a subsidiary

Balance at 31 December 2021

The accompanying notes form an integral part of the Company’s financial statements.

Notes

Share
Capital

Retained
Earnings

Total
Equity

715,406

(75,832)

639,574

–

11,805

54,169

–

54,169

–

(42,648)

2,068

997

(2,068)

–

997

772,640

(108,743)

663,897

–

(2,450)

73,893

–

73,893

–

(47,953)

1,978

1,844

(1,978)

–

1,844

850,355

(161,124)

689,231

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BBGI Global Infrastructure S.A. | Annual Report 2021

Company Statement of Cash Flows

For the year ended 31 December 2021

In thousands of Pounds Sterling

Operating activities

Profit (loss) from continuing operations

Adjustments for:

Net finance result

Foreign currency exchange loss (gain) – net

Tax expense

Working capital adjustments:

Advances/other receivables from subsidiary

Other current assets

Trade and other payables and current tax liabilities

Cash from (used) in operating activities

Taxes paid

Net cash flows from/(used) in operating activities

Investing activities

Loan repayment from subsidiaries

Loans provided to subsidiaries

Investment in subsidiaries

Interest received

Net cash flows used in investing activities

Financing activities

Proceeds from issuance of ordinary shares-net

Dividends paid

Net cash flows from financing activities

Net increase (decrease) in cash and cash equivalents

Impact of foreign exchange gain on cash and cash equivalents

Cash and cash equivalents at 1 January

Cash and cash equivalents at 31 December

The accompanying notes form an integral part of the Company’s financial statements

Notes

2021

2020

(2,450)

11,805

6,7

(20,118)

(18,773)

5,063

459

(5,173)

427

30,279

(11,448)

(69)

(119)

(108)

(429)

13,045

(23,699)

(445)

12,600

(432)

(24,131)

29,449

34,741

(57,971)

(15,802)

(17,405)

(39,745)

12,925

(33,002)

17,949

(2,857)

73,893

54,169

(47,953)

(42,648)

25,940

5,538

137

5,636

11,311

11,521

(15,467)

185

20,918

5,636

BBGI Global Infrastructure S.A. | Annual Report 2021

143

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCE
Notes to the Company Financial Statement

For the year ended 31 December 2021

1. Corporate information
BBGI Global Infrastructure S.A., formerly BBGI SICAV S.A., (‘BBGI’, or the ‘Company’) is an investment company incorporated in Luxembourg in
the form of a public limited company (société anonyme) with variable share capital (société d’investissement à capital variable, or ‘SICAV’) and
regulated by the Commission de Surveillance du Secteur Financier (‘CSSF’) under Part II of the amended Luxembourg law of 17 December 2010
on undertakings for collective investments with an indefinite life. The Company qualifies as an alternative investment fund within the meaning of
Article 1 (39) of the amended law of 12 July 2013 on Alternative Investment Fund Managers (‘2013 Law’) implementing Directive 2011/61/EU of
the European Parliament and of the Council of 8 June 2011 on Alternative Investment Fund Managers and amending Directives 2003/41/EC and
2009/65/EC and Regulations (EC) No 1060/2009 and (EU) No 1095/2010 and is authorised as an internal alternative investment fund manager
in accordance with Chapter 2 of the 2013 Law. The Company was admitted to the official list of the UK Listing Authority (premium listing, closed-
ended investment fund) and to trading on the main market of the London Stock Exchange on 21 December 2011.

As of 1 January 2021, the main market of the London Stock Exchange is not considered as an EU regulated market (as defined by the MiFID II).
As a result, Directive 2004/109/EC of the European Parliament and of the Council of 15 December 2004 on the harmonisation of transparency
requirements in relation to information about issuers whose securities are admitted to trading on a regulated market and amending Directive
2001/34/EC (the Transparency Directive) as implemented in the Luxembourg law by the act dated 11 January 2008 on transparency requirements
for issuers (the Transparency Act 2008), among other texts, does not apply to the Company.

The Company’s registered office is EBBC, 6E, route de Treves, L-2633 Senningerberg, Luxembourg. On 27 October 2020, the Company changed
its registered name from BBGI SICAV S.A. to the current BBGI Global Infrastructure S.A.

The Company is a closed-ended investment company that invests, through its subsidiaries, principally in a diversified portfolio of operational
Public-Private Partnership (‘PPP’)/Private Finance Initiative (‘PFI’) infrastructure assets or similar style assets. At 31 December 2021, the Company
has one indirectly held investment that is under construction (31 December 2020: one).

The Company had no employees as of 31 December 2021 and 2020, respectively.

Reporting period
The Company´s reporting period runs from 1 January to 31 December each year. The Company´s statement of comprehensive income, statement of
financial position, statement of changes in equity and statement of cash flows include comparative figures as at 31 December 2020.

The amounts presented as ‘non-current’ in the Company´s statement of financial position are those expected to be recovered or settled after more
than one year. The amounts presented as ‘current’ are expected to be recovered settled within one year. These financial statements were approved
by the Management Board on 30 March 2022.

2. Basis of preparation

Statement of compliance
The separate financial statements of the Company have been prepared in accordance with International Financial Reporting Standards (‘IFRS’)
as adopted by the European Union (‘EU’), and applying IAS 27 - Separate Financial Statements, recognition and measurement requirements, in
accounting for its investment in subsidiary. Please refer to Note 3 d) for the accounting policy for the investment in subsidiary.

The Company also prepares consolidated financial statements in accordance with IFRS as adopted by the EU.

The Company follows, to the fullest extent possible, the provisions of the Standard of Recommended Practices issued by the Association of
Investment Companies (‘AIC SORP’). If the provisions of the AIC SORP are in direct conflict with IFRS as adopted by the EU, the standards of the
latter shall prevail.

The separate financial statements have been prepared using the going concern principle under the historical cost basis.

In the Company Statement of Comprehensive Income, certain amounts in respect to ‘administrative expenses’ and ‘other operating expenses’ for
the year ended 31 December 2020 were reclassified in order to ensure comparability with the current year presentation. This reclassification had no
effect on the reported net results nor the net asset value as at 31 December 2020.

Functional and presentation currency
These financial statements are presented in Pounds Sterling, the Company’s functional currency. All amounts presented in tables throughout the
report have been rounded to the nearest thousand, unless otherwise stated.

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BBGI Global Infrastructure S.A. | Annual Report 2021

2. Basis of preparation (continued)

Impairment testing for investments
Investment in subsidiary and loans receivable from subsidiaries are measured at cost less accumulated impairment losses. The impairment losses
are based on expected credit loss (‘ECL’) on such receivables. The loans and receivables of the Company from its subsidiaries are directly linked to
the PPP/PFI assets financed by these subsidiaries either through loans and/or equity investments. The ECL, if any, of the Company from its loans
and receivables from subsidiaries has a direct link with the fair value of the Group´s portfolio of investments (‘PPP/PFI investments’). The Company
performs a fair valuation of the underlying PPP/PFI investment portfolio every six months and considers any ECL on the loans and receivables,
among others based on the results of the valuation. The fair valuation of the underlying PPP/PFI investments is done by calculating the net present
value of the cash flows from these assets, based on internally generated models. The net present value of each asset is determined using future
cash flows, applying certain macroeconomic assumptions for the cash flows which include indexation rates, deposit interest rates, corporate
tax rates and foreign currency exchange rates. The cash flows are discounted at the applicable discount rate for companies involved in service
concession assets. A material change in the macroeconomic assumptions and discount rates used for such valuation could have a significant
impact on the net present value of the cash flows. The determined fair value will be considered as the recoverable amount to be compared to the
carrying amount of investment in subsidiary to determine possible impairment. Excess of the carrying amount of the investment in subsidiary over
the recoverable amount is recognised as impairment loss. As of 31 December 2021, the Company identified no ECL to be recorded on its loans and
receivables from subsidiaries (2020: nil) nor impairment on its investment in subsidiary.

3. Summary of significant accounting policies

a) Foreign currency transactions
Transactions in foreign currencies are translated into Pounds Sterling at the exchange rate on the dates of the transactions. Monetary assets and
liabilities denominated in foreign currencies at the reporting date are translated into Pounds Sterling at the exchange rate on that date.

Non-monetary assets and liabilities denominated in foreign currencies that are measured at fair value are translated into Pounds Sterling at the
exchange rate on the date that the fair value was determined. Foreign currency differences arising on translation are recognised in the statement of
comprehensive income as a gain or loss on currency translation.

b) Foreign currency translations
The assets and liabilities of foreign operations are translated to Pounds Sterling at the exchange rates on the reporting date. The income and
expenses of foreign operations are translated to Pounds Sterling at the average exchange rates during the year, if such does not significantly
deviate from the exchange rates at the date on which the transaction is entered into. If significant deviations arise, then the exchange rate at the
date of the transaction is used.

c) Financial instruments
A financial instrument is any contract that gives rise to a financial asset of one entity and a financial liability or equity instrument of another entity.

In general, the Company derecognises a financial asset when the contractual rights to the cash flows from the asset expire, or it transfers the
rights to receive the contractual cash flows in a transaction in which substantially all the risks and rewards of ownership of the financial asset are
transferred. Any interest in such transferred financial assets that is created or retained by the Company is recognised as a separate financial asset or
liability.

Financial assets and liabilities are offset and the net amount presented in the statement of financial position when, and only when, the Company has
a legal right to offset the amounts and intends either to settle on a net basis or to realise the asset and settle the liability simultaneously.

At the date of the statement of financial position, all financial assets of the Company have been classified as financial assets at amortised cost.
Financial assets of the Company consist of investment in subsidiary, loans receivables from subsidiaries, interest and other receivables from
subsidiaries and cash and cash equivalents.

Financial assets at amortised cost (debt instruments)
Financial assets at amortised cost are subsequently measured using the effective interest (EIR) method and are subject to impairment. Gains and
losses are recognised in the statement of income when the asset is derecognised, modified or impaired.

Financial liabilities
The Company classifies financial liabilities at amortised cost. Such financial liabilities are recognised initially at fair value less any direct attributable
transaction costs. Subsequent to initial recognition, these financial liabilities are measured at amortised cost using the EIR method.

The Company derecognises a financial liability (or part of a financial liability) from the statement of financial position when, and only when, it is
extinguished or when the obligation specified in the contract or agreement is discharged or cancelled or has expired. The difference between
the carrying amount of a financial liability (or part of a financial liability) extinguished or transferred to another party and the consideration paid,
including any non-cash assets transferred or liabilities assumed, is considered in the statement of comprehensive income.

BBGI Global Infrastructure S.A. | Annual Report 2021

145

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Company Financial Statement continuedFor the year ended 31 December 20213. Summary of significant accounting policies (continued)

d) Investments in subsidiary
The investment in subsidiary is held at cost less any impairment.

e) Provisions
A provision is recognised if, as a result of a past event, the Company has a present legal or constructive obligation that can be estimated reliably, and
it is probable that an outflow of economic benefits will be required to settle the obligation. Provisions are determined by discounting the expected
future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and the risks specific to a liability. The
unwinding of such discount is recognised as a finance cost.

f) Cash and cash equivalents
Cash and cash equivalents comprise of cash of balances and term deposits with maturities of three months or less from the date when the deposits
were made and that are subject to an insignificant risk of change in their fair value, and are used by the Company in the management of its short-
term commitments.

g) Share capital
Ordinary shares are classified as equity. Costs directly attributable to the issue of ordinary shares, or which are associated with the establishment of
the Company, that would otherwise have been avoided are recognised as a deduction from equity, net of any tax effects.

h) Finance income and finance costs
Interest income and expenses are recognised in statement of comprehensive income using the EIR method.

The effective interest rate is the rate that exactly discounts the estimated future cash payments and receipts through the expected life of the
financial instrument (or, where appropriate, a shorter period) to the carrying amount of the financial instrument. When calculating the effective
interest rate, the Company estimates future cash flows considering all contractual terms of the financial instrument, but not future credit losses.

Interest received or receivable and interest paid or payable are recognised in statement of comprehensive income as finance income and finance
costs, respectively.

i) Tax
According to the Luxembourg regulations regarding SICAV companies, the Company itself, as an undertaking for collective investment, is exempt
from paying income and/or capital gains taxes in Luxembourg. It is, however, liable to annual subscription tax of 0.05 per cent. on its consolidated
net asset value (‘NAV’) payable quarterly and assessed on the last day of each quarter.

j) Current versus non-current classification
The Company presents assets and liabilities in the statement of financial position based on current/non-current classification. An asset is current
when it is:
–

Expected to be realised or intended to be sold or consumed in the normal operating cycle

–

Held primarily for the purpose of trading

Expected to be realised within 12 months after the reporting period or

Cash or cash equivalent unless restricted from being exchanged or used to settle a liability for at least 12 months after the reporting period

All other assets are classified as non-current.

A liability is current when:
–

It is expected to be settled in the normal operating cycle

–

It is held primarily for the purpose of trading

It is due to be settled within 12 months after the reporting period or

There is no unconditional right to defer the settlement of the liability for at least 12 months after the reporting period

The terms of the liability that could, at the option of the counterparty, result in its settlement by the issue of equity instruments do not affect its
classification.

The Company classifies all other liabilities as non-current.

146

BBGI Global Infrastructure S.A. | Annual Report 2021

For the year ended 31 December 2021Notes to the Company Financial Statement continued4. Significant accounting judgements, estimates and assumptions
The preparation of financial statements in conformity with IFRS requires the Management Board to make judgements, estimates and assumptions
that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from
these estimates.

In the process of applying the Company´s accounting policies, the Management Board has made the following judgements that would have the
most significant effect on the amounts recognised in the Company’s financial statements.

4.1 Impairment testing for investments
Refer to Note 2 for the discussion of this topic.

4.2 Going concern basis of accounting
The Management Board has examined significant areas of possible financial risk including cash and cash requirements. It has not identified any
material uncertainties which would cast significant doubt on the Company’s ability to continue as a going concern for a period of 12 months from
the date of approval of the Company’s financial statements. The Management Board has satisfied itself that the Company has adequate resources
to continue in operational existence for the foreseeable future. As part of its assessment, the Management Board has considered the risk posed
by the COVID-19 pandemic. The Management Board has satisfied itself that the Company has adequate resources to continue in operational
existence for the foreseeable future. After due consideration, the Management Board believes it is appropriate to adopt the going concern basis of
accounting in preparing the financial statements.

5. Administrative expenses

In thousands of Pounds Sterling

Support agreement fees (see Note 13)

Legal and professional fees

Supervisory Board fees and expenses

Others

Year ended
31 December
2021

Year ended
31 December
2020

6,982

2,090

225

201

6,637

1,956

231

177

9,498

9,001

Included in the legal and professional fees expensed during the year are those amounts charged by the Company’s external auditor which include
audit fees of £157,000 (2020: £159,000) and audit related fees of £64,000 (2020: £66,000). No non-audit related fees were charged by the
Company’s external auditors during the year (2020: nil). These administrative expenses also include depositary and custodian related charges
which amounted to £460,000 (2020: £347,000).

6. Other operating expenses

In thousands of Pounds Sterling

Foreign exchange indemnity agreement expense (see Note 13)

Foreign currency exchange loss - net

Acquisition-related and unsuccessful bid costs

7. Other operating income

In thousands of Pounds Sterling

Foreign currency exchange gain -net

Others

Year ended
31 December
2021

Year ended
31 December
2020

6,965

5,063

583

12,611

1,891

–

830

2,721

Year ended
31 December
2021

Year ended
31 December
2020

–

5,173

5,181

BBGI Global Infrastructure S.A. | Annual Report 2021

147

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Company Financial Statement continuedFor the year ended 31 December 20218. Net finance result

In thousands of Pounds Sterling

Finance income from multi-currency facility (see Note 13)

Interest income from deposits

Other finance costs

9. Tax expense
Current tax payable in 2021 amounting to £116,000 relates to subscription tax due (2020: £102,000).

A reconciliation of the tax expense and the tax at applicable tax rate is as follows:

In thousands of Pounds Sterling

Profit (loss) before tax

Income tax using the Luxembourg domestic tax rate of 24.94%

Effect of tax-exempt deductions/(income)

Subscription tax expense

Tax charge for the year

Year ended
31 December
2021

Year ended
31 December
2020

20,149

18,768

–

(31)

–

20,118

18,773

Year ended
31 December
2021

Year ended
31 December
2020

(1,991)

(497)

497

459

12,232

3,051

(3,051)

427

The Company, as an undertaking for collective investment, pays an annual subscription tax of 0.05 per cent. on its consolidated NAV. For the year
ended 31 December 2021, the Company incurred a subscription tax charge of £459,000 (2020: £427,000). All direct and indirect subsidiaries of
the Company are subject to corporation tax at the applicable rate in their respective jurisdictions.

10. Cash and cash equivalents
Cash and cash equivalents relates to bank deposits amounting to £11,311,000 (2020: £5,636,000).

11. Share capital
Changes in the Company´s share capital are as follows:

In thousands of Pounds Sterling

Share capital as at 1 January

Issuance of ordinary shares through placing

Shares issuance cost on placing

Share capital issued through scrip dividends

Shares issued as share based compensation

31 December
2021

31 December
2020

772,640

75,000

715,406

55,000

(1,107)

1,978

1,844

(831)

2,068

997

850,355

772,640

In July 2021, the Company raised gross proceeds of £75,000,000 through a placing of 45,180,722 new ordinary shares of no-par value (‘Placing’).
The Placing price was set at 166.0 pence per Placing share. The related share issuance cost amounted to £1,107,000.

BBGI Management HoldCo S.à r.l. (‘MHC’), a wholly owned subsidiary of the Company, provides share-based compensation to senior executives
whereby it will issue a certain number of shares of the Company to entitled executives calculated based on the conditions of the Long-Term
Incentive Plan (‘LTIP’) rules and the respective LTIP Award letters. During the year, in accordance with the LTIP agreement, the Company
issued 1,099,229 shares, in connection with the LTIP, at 167.8 pence per share for a total amount of £1,844,000 (2020: £997,000). The amount of
£1,844,000 was recorded as an advance made by the Company to MHC during the year (2020: £997,000).

148

BBGI Global Infrastructure S.A. | Annual Report 2021

For the year ended 31 December 2021Notes to the Company Financial Statement continued11. Share capital (continued)
The changes in the number of ordinary shares of no-par value issued by the Company are as follows:

In thousands of shares

In issue at beginning of the year

Shares issued through placing of ordinary shares

Shares issued through scrip dividends

Shares issued as share based compensation

31 December
2021

31 December
2020

664,691

630,213

45,181

1,155

1,099

32,544

1,244

690

712,126

664,691

All shares rank equally with regard to the Company’s residual assets. The holders of ordinary shares are entitled to receive dividends as declared
from time to time, and are entitled to one vote per share at general meetings of the Company.

The Company meets the minimum share capital requirement as imposed under the applicable Luxembourg regulation.

Dividends
The dividends declared and paid by the Company during the year ended 31 December 2021 are as follows:

In thousands of Pounds Sterling except as otherwise stated

2020 2nd interim dividend of 3.59 pence per qualifying ordinary share – for the period 1 July 2020 to 31 December 2020

2021 1st interim dividend of 3.665 pence per qualifying ordinary share– for the period 1 January 2021 to 30 June 2021

Total dividends declared and paid during the year

31 December
2021

23,863

26,068

49,931

The dividends declared and paid by the Company during the year ended 31 December 2020 are as follows:

In thousands of Pounds Sterling except as otherwise stated

2019 2nd interim dividend of 3.5 pence per qualifying ordinary share – for the period 1 July 2019 to 31 December 2019

2020 1st interim dividend of 3.59 pence per qualifying ordinary share – for the period 1 January 2020 to 30 June 2020

Total dividends declared and paid during the year

31 December
2020

22,057

22,659

44,716

The 31 December 2019 2nd interim dividend was paid in April 2020. The value of the scrip election was £429,000, with the remaining amount of
£21,628,000 paid in cash to those investors that did not elect for the scrip.

Net asset value
The Company net asset value and net asset value per share as of 31 December 2021, 2020 and 2019 are as follows:

In thousands of Pounds Sterling/pence

Net asset value attributable to the owners of the Company

Net asset value per ordinary share (pence)

2021

2020

2019

689,231

663,897

639,574

96.78

99.88

101.49

BBGI Global Infrastructure S.A. | Annual Report 2021

149

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Company Financial Statement continuedFor the year ended 31 December 202112. Financial risk and capital risk management
The Company has exposure to the following risks from financial instruments:
– Credit risk

–

Liquidity risk

– Market risk

This note presents information about the Company’s exposure to each of the above risks, the Company’s objectives, policies and processes
for measuring and managing risk and the Company’s management of capital. This note also presents the result of the review performed by
management on the above-mentioned risk areas.

Risk management framework
The Management Board has overall responsibility for the establishment and control of the Company’s risk management framework.

Credit risk
Credit risk is the risk that the counterparty to a financial instrument will fail to discharge an obligation or commitment that it has entered into with
the Company, resulting in:

impairment or reduction in the amounts recoverable from receivables and other current and non-current assets; and

2) non-recoverability, in part or in whole, of cash and cash equivalents deposited with banks.

A significant part of receivables of the Company are receivables from subsidiaries. These subsidiaries have the ability to pay based on the projected
cash flows to be received by such subsidiaries from its investments.

Exposures to credit risks
The Company is exposed to credit risks on the following items in the Company’s statement of financial position:

In thousands of Pounds Sterling

Loans and other receivable to subsidiaries (including accrued interest)

Cash and cash equivalents

31 December
2021

31 December
2020

344,366

326,291

11,311

355,677

5,636

331,927

The maximum exposure to credit risk on receivables that are neither overdue nor impaired as of 31 December 2021, amounts to £344,366,000
(2020: £326,291,000).

Recoverable amounts of receivables and other current and non-current assets
The Company establishes when necessary an allowance for impairment, based on ECL specific to the asset. Currently there are no recorded
allowances for impairment. All the Company’s receivables are recoverable and no significant amounts are considered as overdue, impaired or
subject to ECL.

Cash and cash equivalents
The cash and cash equivalents are maintained with reputable banks with ratings that are acceptable based on the established internal policy of the
Company. Based on the assessment of the Management Board, there are no significant credit risks related to the cash and cash equivalents. The
main counterparty banks of the Company have S&P/Moody’s credit rating between A+/Aa3 and AA-/Aa2.

Liquidity risk
Liquidity risk is the risk that the Company will encounter difficulty in meeting the obligations associated with its financial liabilities that are settled by
delivering cash or another financial asset.

The Company’s policy over liquidity risk is that it will seek to have sufficient liquidity to meet its liabilities and obligations when they fall due.

The Company manages liquidity risk by maintaining adequate cash and cash equivalents and access to borrowing facilities to finance day-to-day
operations and medium to long-term capital needs. The Group also regularly monitors the forecast and actual cash requirements and matches the
maturity profiles of the Group’s financial assets and financial liabilities.

The Company has the possibility to raise capital through the issuance of shares in order to finance further acquisitions.

All external financial liabilities of the Company have maturities of less than one year. The Company has sufficient cash and cash equivalents and
sufficient funding sources to pay and/or refinance currently maturing obligations.

150

BBGI Global Infrastructure S.A. | Annual Report 2021

For the year ended 31 December 2021Notes to the Company Financial Statement continued12. Financial risk and capital risk management (continued)

Market risk
Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices, will affect the Company’s
income or the value of its holdings of financial instruments. The objective of market risk management is to manage and control market risk
exposures within acceptable parameters, while optimising the returns.

UK departure from the European Union
As part of the UK’s preparations for Brexit, the UK government established a temporary permissions regime (‘TPR’) enabling European Economic
Area (‘EEA’) AIFs with EEA AIFMs passporting into the UK at the end of the transition period to continue to access the UK market in the same
manner as before the transition period ended for a limited period of time.

In Q2 2021, the Company received confirmation from the FCA of its ‘Landing Slot’ during which BBGI is required to submit a notification under the
NPPR in order to continue to market BBGI to professional investors in the UK. In August 2021, BBGI provided the necessary written notification to
the FCA in advance of the 1 November 2021 deadline.

The Company together with its Subsidiaries (collectively referred to as the ‘Group’), in which the Company is the ultimate parent entity, maintains
a pure-play PPP-style investment platform, fully committed to a strict investment strategy into availability-based assets. This generates stable,
predictable cash flows backed by secure, highly visible contracted public sector revenues and significantly carry no exposure to demand or
regulatory risk. While the Brexit outcome remains uncertain we can say that, regardless of the outcome, the Group’s portfolio cash flows are
contracted and, unlike demand-based assets, are not sensitive to the performance of the wider economic environment.

Currency Risk
The Company is exposed to currency risk as a result of its cash and cash equivalents being denominated in currencies other than Pounds Sterling.
The currencies in which these items are primarily denominated are Australian Dollar (A$), Canadian Dollar (C$), Euro (€), Norwegian Krone (NOK)
and US Dollar (US$).

In respect of other monetary assets and liabilities denominated in currencies other than Pounds Sterling, the Company’s policy is to ensure that its
net exposure is kept at an acceptable level. The management believes that there is no significant concentration of currency risk in the Company.

The summary of the quantitative data about the Company’s exposure to foreign currency risk provided to the management is as follows:

31 December 2021

In thousands of Pounds Sterling

Cash and cash equivalents

Trade and other payables

31 December 2020

In thousands of Pounds Sterling

Cash and cash equivalents

Trade and other payables

–

€

331

(641)

(310)

€

202

(1,031)

(829)

NOK

US$

–

NOK

US$

–

The Company has loans and receivables from MHC denominated in foreign currency but the Company is not exposed to fluctuations in foreign
exchange rates in relation to these receivables due to the foreign exchange indemnity agreement entered into between the Company and MHC
(see Note 13).

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151

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Company Financial Statement continuedFor the year ended 31 December 2021

12. Financial risk and capital risk management (continued)

Currency Risk (continued)
The significant exchange rates applied during the year ended 31 December 2021 and 31 December 2020 are as follows:

A$ 1

C$ 1

€ 1

NOK 1

US$ 1

A$ 1

C$ 1

€ 1

NOK 1

US$ 1

31 December 2021

Average £

Spot rate £

0.546

0.580

0.860

0.085

0.727

0.537

0.583

0.840

0.084

0.740

31 December 2020

Average £

Spot rate £

0.538

0.581

0.889

0.083

0.780

0.565

0.575

0.899

0.086

0.733

The impact of a strengthening or weakening of Pounds Sterling against the A$, C$, NOK and US$, as applicable, by 10 per cent. at 31 December
2021 and 31 December 2020 would not have a significant impact on the Company’s cash and cash equivalents or the statement of comprehensive
income. This assumes that all other variables, in particular, interest rates, remain constant and ignores any impact of forecast revenues, hedging
instruments and other related costs.

Fair values versus carrying amounts
The below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
–

Level 1: quoted prices (unadjusted) in active markets for identical assets and liabilities.

–

Level 2: inputs other than quoted prices included in Level 1, that are observable for the asset or liability, either directly (i.e. as prices) or indirectly
(i.e. derived from prices).

Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).

The carrying amounts of cash and cash equivalents, receivables and payables approximates their fair value due to their short-term nature with
maturity of one year or less, or on demand.

The fair value of loans and other receivables from subsidiaries and investment in subsidiary, with a total carrying value of £681,167,000 (2020:
£659,647,000), amounts to £976,249,000 (2020: £897,305,000). The fair value of these loans receivable and investment in subsidiary is
determined by discounting the future cash flows to be received from such assets using applicable market rates (Level 3).

Capital risk management
The Company’s objective when managing capital is to ensure the Company’s ability to continue as a going concern in order to provide returns to
shareholders and benefits for further stakeholders and to maintain an optimal capital structure. The Company views the share capital (see Note 11)
as capital.

In order to maintain or adjust the capital structure, the Company may adjust the amount of dividend paid to shareholders, return capital to
shareholders, avail of additional debt financing, pay down debt, or issue new shares.

The Company regularly reviews compliance with Luxembourg regulations regarding restrictions on minimum capital. During the year, the
Company complied with all externally imposed capital requirements and made no changes in its approach to capital management.

The portfolio continued its strong performance over the reporting period with no material adverse effect on valuation resulting from COVID-19.
This strong performance is primarily as a result of the Company holding a low-risk, 100 per cent. availability-based underlying portfolio, coupled
with strong stakeholder collaboration during the reporting period. We will continue to work very closely with all stakeholders to help mitigate the
risks and effects of the global pandemic.

152

BBGI Global Infrastructure S.A. | Annual Report 2021

For the year ended 31 December 2021Notes to the Company Financial Statement continued13. Related parties and key contracts

Supervisory Board fees
During the year 31 December 2021, the aggregate remuneration of the Directors of the Supervisory Board was £220,000 (2020: £209,000).

Loans and receivables from subsidiaries – multicurrency facility agreement
On 1 January 2017, the Company as a lender and MHC as a borrower, entered into a multicurrency facility agreement (‘MCF’). Pursuant to this agreement
the Company has and will continue to make available an interest-bearing loan to MHC for the purposes of funding its initial and subsequent acquisitions
of interests in PPP/PFI and similar styled infrastructure assets. The maximum amount that can be withdrawn from the MCF is £680,000,000. The interest
rate charged on the withdrawn amount shall be the interest rate on loans charged to the underlying projects less an appropriate margin.

Movements in the MCF during the year are as follows:

In thousands of Pounds Sterling

1 January

Additions

Capitalisation of interest under MCF

Principal payments received

Foreign exchange movements

31 December
2021

31 December
2020

217,182

36,398

(5,060)

(4,965)

243,638

201,342

15,802

100

(4,930)

4,868

217,182

During the year, the finance income from the MCF amounted to £20,149,000 (2020: £18,768,000).

Loans receivable from subsidiaries – interest free loan agreements
The Company has entered into various interest free loan agreements (‘IFL’) with MHC, a direct 100 per cent. owned subsidiary. These IFLs have a term of one
year with the possibility to extend and to introduce an arm’s length interest rate. The details of the interest free loans receivable from MHC is as follows:

In thousands of Pounds Sterling

IFL receivable from MHC

Interest and other receivables from subsidiaries
The details of the interest and other receivables from subsidiaries are as follows:

In thousands of Pounds Sterling

Interest receivable from MCF

Other advances to MHC

31 December
2021

31 December
2020

91,968

94,784

31 December
2021

31 December
2020

8,760

–

8,760

1,880

12,445

14,325

Foreign exchange indemnity agreement
The Company and MHC have entered into a foreign exchange indemnity agreement (Indemnity Agreement) whereby the Company will indemnify
MHC for any net losses incurred by MHC in relation to foreign exchange movements, including losses incurred on foreign exchange forward contracts.
The agreement also stipulates that where MHC makes a net gain on foreign transactions, then it shall pay an equivalent amount to the Company. As at
31 December 2021, the Company recorded Indemnity Agreement Expense amounting to £6,965,000 (2020: £1,891,000).

As of 31 December 2021, all obligations of the Company to MHC resulting from the Indemnity Agreement were settled.

Support agreement with MHC
The Company and MHC have entered into a support agreement (Support Agreement) whereby MHC provides support and assistance to the
Company with respect to the day-to-day operations. As at 31 December 2021, the Company recorded Support Agreement expenses amounting to
£6,982,000 (2020: £6,637,000).

As at 31 December 2021, the Company had £1,706,000 outstanding liabilities to MHC in relation to the above (2020: nil).

Advances from subsidiary
This account is non-interest bearing and relates to liabilities arising from the Indemnity Agreement and advances received from MHC that is usually
settled in the next 12 months. Advances from subsidiary as at 31 December 2021 amounted to £15,990,000 (2020: nil).

BBGI Global Infrastructure S.A. | Annual Report 2021

153

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCENotes to the Company Financial Statement continuedFor the year ended 31 December 202114. Investment in subsidiary
MHC, the Company’s wholly-owned direct subsidiary, is a Company incorporated and domiciled in Luxembourg. The Company’s total equity
investment in MHC amounted to £350,453,000 as of 31 December 2021 (2020: £333,048,000). The movements in the Company’s investment in
MHC are as follows:

In thousands of Pounds Sterling

1 January

Additional investment through capital contribution

31 December
2021

31 December
2020

333,048

293,303

17,405

39,745

350,453

333,048

The Company’s investments in PPP/PFI infrastructure assets, or similar assets, were made and will continue to be made through MHC.

15. Commitments and contingencies
The Company is an obligor under the Group RCF, and as a result has pledged all its current and future financial assets and shares in its investments
in subsidiaries.

Based on the provisions of the RCF, where there is a continuing event of default by MHC as borrower, the lenders will, among other things, have the
right to cancel all commitments and declare all or part of utilisations to be due and payable, including all related outstanding amounts, and exercise
or direct the security agent to exercise any or all of its rights, remedies, powers or discretions under the RCF. There were no outstanding principal
from the RCF as at the 31 December 2021.

16. Standards issued but not yet effective
A number of new standards and amendments to standards are effective for annual periods beginning after 1 January 2021 and earlier application
is permitted; however, the Company has not early adopted any of the forthcoming new or amended standards in preparing these financial
statements. The Company intends to adopt these new and amended standards, if applicable, when they become effective.

The adoption of the below new standards is not expected to have a significant impact on the Company’s financial statements.

Reference to the Conceptual Framework – Amendments to IFRS 3
In May 2020, the IASB issued Amendments to IFRS 3 Business Combinations - Reference to the Conceptual Framework for Financial Reporting
and add an exception for the recognition of liabilities and contingent liabilities within the scope of IAS 37 Provisions, Contingent Liabilities and
Contingent Assets and Interpretation 21 Levies. The amendments also confirm that contingent assets should not be recognised at the acquisition
date. The amendments are effective for annual reporting periods beginning on or after 1 January 2022.

The amendments apply a “directly related cost approach”. The costs that relate directly to a contract to provide goods or services include both
incremental costs and an allocation of costs directly related to contract activities. General and administrative costs do not relate directly to a
contract and are excluded unless they are explicitly chargeable to the counterparty under the contract. The amendments are effective for annual
reporting periods beginning on or after 1 January 2022.

17. Events after the reporting period.

154

BBGI Global Infrastructure S.A. | Annual Report 2021

For the year ended 31 December 2021Notes to the Company Financial Statement continuedBoard Members, Agents & Advisers

Supervisory Board
–

Sarah Whitney (Chair)

– Howard Myles

–

Jutta af Rosenborg

– Christopher Waples (appointed as of 1 May 2021)

Management Board
– Duncan Ball

– Michael Denny

–

Frank Schramm

Receiving Agent and UK Transfer Agent
Link Market Services Trustees Limited
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
United Kingdom

Auditors
KPMG Luxembourg, Société anonyme
39 Avenue John F. Kennedy
L-1855 Luxembourg

Luxembourg CSD Principal Agent
Banque Internationale à Luxembourg
69 route d’Esch
Office PLM 018A
L-2953 Luxembourg

Winterflood Securities Limited
Cannon Bridge House
25 Dowgate Hill
London EC4R 2GA
United Kingdom

Registered Office
EBBC, 6E route de Trèves
L-2633 Senningerberg
Grand Duchy of Luxembourg

Central Administrative Agent, Luxembourg Registrar
and Transfer Agent, Depositary and Principal Paying Agent
RBC Investor Services Bank S.A.
14 Porte de France
L-4360 Esch-sur-Alzette
Grand Duchy of Luxembourg

Depository
Link Market Services Trustees Limited
The Registry
34 Beckenham Road
Beckenham
Kent BR3 4TU
United Kingdom

Corporate Brokers
Jefferies International Limited
100 Bishopsgate
London EC2N 4JL
United Kingdom

EEA based Centralised Securities Depository

LuxCSD
42 Avenue John F. Kennedy
L-1855 Luxembourg

Communications Adviser
Maitland/AMO
3 Pancras Square
London N1C 4AG
United Kingdom

Registre de Commerce et des Sociétés Luxembourg B163879

Listing:

Trading:

ISIN:

SEDOL:

Ticker:

Indices:

Chapter 15 premium listing, closed-ended investment company

Main Market

LU0686550053

B6QWXM4

BBGI

FTSE 250, FTSE 350, FTSE 350 High Yield and FTSE All-Share

BBGI Global Infrastructure S.A. | Annual Report 2021

155

COMPANY OVERVIEWSTRATEGIC REPORTFINANCIAL STATEMENTSCORPORATE GOVERNANCEB

Registered Office
EBBC, 6E route de Trèves
L-2633 Senningerberg
Grand Duchy of Luxembourg