Foresight Solar Share Discussion Threads

[mwj1959] 12/3/2024 11:09

Note the Continuation Vote due at the June AGM as the average discount in 23 was well above the 10% threshold at 16%. I would be very surprised if there was a a vote to discontinue it, even though the current discount has widened even further to c.23%. Winding this up would certainly have its challenges. The Board seem confident that the discount will narrow. I'm less sure about that in the current environment, at least in a material way. There are plenty of factors that can impact the NAV, both positively and negatively (see p.42 of today's Annual Report), so I struggle to see the discount being structurally much below 10%, particularly in an environment where its hard to find meaningful buyers of such assets. That's clearly a better outturn than where we are currently, particularly if the NAV were to rise, but it's certainly not a return to the heady days when this traded at a premium. The 8.8% DY at current levels clearly has its attractions and provides an element of downside protection, so risk / reward is probably tilted in ones favour over the next 12m with a 20% TR not an unreasonable expectation.

[masurenguy] 12/3/2024 07:10

Foresight Solar Fund Limited Annual Results to 31 December 2023

· Net Asset Value (NAV) of £697.9m (31 December 2022: £771.5m). The uplift from the sale of the Lorca portfolio stake at a 21% premium to holding value, alongside an active price hedging strategy, mitigated negative impacts from higher discount rates and softening power price forecasts.

· Record electricity generation with 1,094GWh exported to the grid, enough to power over 400,000 UK households for a year - avoiding 390,000 tonnes of carbon dioxide emissions.

· Record cash distribution from the underlying assets of £120 million, the highest in Foresight Solar's 10-year history.

· FSFL delivered on the first phase of its divestment programme with the sale of a 50% stake in the Lorca portfolio. The proceeds from this transaction, alongside free cash, were used to pay down £40 million of variable rate debt on the RCF, bringing the drawn balance down to £75 million.

· Foresight Solar grew its proprietary pipeline with the acquisition of the rights to a 467MWp portfolio of development-stage solar projects in Spain. The move exemplifies the Company's capital allocation strategy, focused on new investments with limited upfront capital requirements to drive long-term growth and total shareholder returns.

· Foresight Solar returned £20 million to shareholders via share buybacks, deploying half of the £40 million allocation in the year and delivering 1.1 pence per share of NAV accretion.

· Total dividend of 7.55 pence per share declared for the full year, in line with the Company's target. Dividend cover for 2023 was 1.61x.

· Target dividend of 8.00 pence per share for 2024, an increase of 6% compared to the previous year. The 2024 target is expected to be 1.50x covered from cash generated in the period, with around 1.35x cover for 2025 - assuming current revenue forecasts.

· The sale of several large ROC-backed solar portfolios in the UK offers reliable market benchmarks for the Company's assets. The price at which the latest deal closed indicates a value per megawatt approximately 15% above Foresight Solar's £1.17m/MW valuation of its UK portfolio.

Alexander Ohlsson, Chairman of Foresight Solar, said: "Foresight Solar delivered resilient performance with record electricity production and cash distribution against a challenging market backdrop. Our operational strength, the powerhouse behind our progressive dividend, enabled us to comfortably meet our dividend target of 7.55p per share for 2023 and allows us to propose an above inflation increase of 6.0% for the 2024 target dividend of 8.0p per share.

During the year, we have remained focused on initiatives to address the discount to NAV at which the Company's shares have traded and to place the fund in the best possible financial position to support shareholders' interests. We paid down £40 million of variable rate RCF debt, reducing financing costs, and returned £20 million to investors via share buybacks. The Board is adhering to its disciplined approach to capital allocation and the only new project investments currently under consideration are modest investments to expand the development stage pipeline.

In the year Foresight Solar celebrated its 10th anniversary, we successfully completed the Company's first divestment. The partial sale of the Spanish Lorca portfolio at a 21% premium to holding value validates our valuation methodology and supports our investment model. Bringing projects through development to construction and then into operation offers optionality and allows the Company to capture financial upside, a strategy we intend to replicate through our development pipeline. The Lorca transaction was also a key driver of NAV uplift, and the Investment Manager continues to make progress on the next phases of the divestment programme. We look forward to providing more details to shareholders in due course.

By leveraging the Investment Manager's local networks in Spain, Foresight Solar purchased the rights to six development-stage solar projects, totalling over 460MWp. Over the medium-term, we will expand this growing proprietary development pipeline and focus on the huge potential for solar and storage to be unlocked throughout Europe. As power price forecasts softened across markets during the year, Foresight Solar's active hedging strategy enabled the fund to lock in higher prices. These favourable terms will help insulate the NAV against market fluctuations in 2024 and beyond, providing greater visibility on dividend cover.

After a challenging year for markets, we believe there are reasons for optimism. The energy transition is one of the biggest investment themes of our generation. The solar power opportunity alone is immense. Industry fundamentals remain attractive and solar generation continues to be one of the cheapest and most reliable sources of electricity available. This promising outlook, coupled with Foresight Solar's improved financial position and clear strategy to deliver income and growth, positions the fund well to capitalise on the opportunities ahead."

[masurenguy] 01/3/2024 07:23

Declaration of Dividend

Foresight Solar is pleased to announce the fourth interim dividend, for the period 1 September 2023 to 31 December 2023, of 1.895p per ordinary share. The shares will go ex-dividend on 25 April 2024 and the payment will be made on 24 May 2024 to shareholders on the register as at the close of business on 25 April 2024. This fourth interim dividend completes Foresight Solar's dividend target of 7.550p per ordinary share for the 2023 financial year.

[neilyb675] 26/2/2024 13:55

88.60 - 89.00 (GBX) at 13:52:59
on Market (LSE)

[barnes4] 16/2/2024 13:48

If people only had the foresight to steer clear roar

Just look at the state of it

[barnes4] 15/2/2024 13:26

Old Barnes cannot be blamed for this carnage
It’s out of control am afraid
This was £1.20 in Nov

[woodhawk] 15/2/2024 12:49

A quick look at barnes4's posts will tell you that imbecile is busy elsewhere imagining his content-free one-liners are somehow destabilising other shareholders. Another moron for the filter.

[melton john] 15/2/2024 12:35

Same for my car and house and I'm not selling them either.

[barnes4] 15/2/2024 12:15

In the meantime it keeps getting cheaper

[masurenguy] 15/2/2024 10:01

Posts #328 & 329 - totally agree !

[aleman] 15/2/2024 09:55

A continuation vote should see the discount reduce and shares rise but I expect any vote would be in favour to continue so it should make no difference in practice. Just buy the high yield as part of a diversified income portfolio and the discount should eventually close in time. Meanwhile, you enjoy a good income.

[jonwig] 15/2/2024 09:52

A CV appears to be a formality arising from the average discount over a period. The discount isn't specific to the company, all the sector experiences it.

There is absolutely nothing wrong with the management, and the high dividend is well-covered. I don't see any reason to vote in favour of a winding up, but if it happened, the share price would no doubt rise to narrow the discount!

[barnes4] 15/2/2024 09:33

If it winds up

What then a fire sale???

Is it worth a short????

[ammons] 15/2/2024 09:03

Same article?

h..ps://www.theaic.co.uk/aic/news/industry-news/continuation-vote-casts-shadow-over-foresight-solars-pale-share-price

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Continuation vote casts shadow over Foresight Solar’s pale share price
Foresight Solar likely to face a continuation vote at its annual general meeting in June after the shares traded at an average 16% below asset value last year, a discount that has now widened to 27%.

14 February 2024

Foresight Solar (FSFL ) faces a continuation vote at its annual general meeting (AGM) in June after the shares traded well below the investment company’s minimum average discount target of 10% below net asset value (NAV) last year.

Reviewing the fund’s fourth quarter update, Peel Hunt analyst Markuz Jaffe said, ‘we calculate Foresight’s average discount during full-year 2023 to have been 16%.

‘This is despite the company having been active with share buybacks on a near-daily basis since May 2023, and leaves us wondering if we should expect to see further proposals from the board that might appease shareholders in the run-up to the continuation vote,’ he said.

At 86.7p this afternoon, the £519m renewable infrastructure fund, which invests in solar farms and battery storage in the UK, Spain and Australia, has seen the discount widen to 27%. This is in line with its rivals, Bluefield Solar (BSIF ) and NextEnergy Solar (NESF ), stand on discounts of around 24% and 30%.

In the three months to 31 December, NAV per share rose just 3p, or 0.3%, to 118.4p as the good price the fund received in November selling half its stake in its Luca portfolio in Spain was offset by declines in power prices and inflation.

With the dividend included, the total return in the quarter was 1.9%.

The 8.6%-yielder said it was on target to deliver an annual dividend of 7.55p per share comfortably covered 1.6 times by earnings.

Although the shares rallied 12.5% in the fourth quarter, they are still down 25% over the past year.

While Foresight has yet to confirm whether a continuation vote will take place, its prospectus outlines that if the shares trade at more than a 10% discount for the financial year the board will propose a special resolution on continuation at the next AGM.

In the update, the fund said the sale of the Lorca assets to pay down borrowing was a ‘clear example’ of its ‘approach to capital recycling and its commitment to reduce variable interest rate debt’.

The fund, which is managed by Ricardo Pineiro and Ross Driver, is aware that near term power prices continued to trend downwards but there has been a ‘slight increase in medium to long-term estimates’ across all geographics.

‘When considered against the company’s well-hedged near-term position and reduced electricity generator levy payments, the overall impact was negligible,’ said the board of the trust.

[jonwig] 15/2/2024 07:01

Continuation vote at the AGM?

[mwj1959] 08/2/2024 16:50

I guess that all the solar companies are being hit in part (or maybe completely) by their exposure to BESS assets. They may be relatively modest in terms of overall exposure currently, but they all have plans to increase exposure there in due course.

[woodhawk] 08/2/2024 11:26

Just another ludicrously low valuation - great for those reinvesting above average dividends in below average share prices.