FORESIGHT SOLAR & INFRASTRUCTURE VCT PLC ORD 1P Foresight Solar & Infrastructure Vct Plc - Annual Financial Report

 
TIDMFTSV 
 
 
   FORESIGHT SOLAR & INFRASTRUCTURE VCT PLC 
 
   Ordinary Shares Total Net Assets as at 30 June 2018: GBP40.8m 
 
   Ordinary Shares Net Asset Value per share as at 30 June 2018: 93.0p 
 
   Ordinary Shares Dividends paid during the year ended 30 June 2018: 6.0p 
 
 
   -- Total net assets GBP40.8 million. 
 
   -- After payment of 6.0p in dividends, Net Asset Value per Ordinary Share at 
      30 June 2018 was 93.0p (2017: 95.9p). 
 
   -- At 30 June 2018, the fund held positions in seven UK solar assets, with a 
      total installed capacity of 48.9MW. During the year the portfolio 
      generated 38.6Gwh of clean energy, sufficient to power approximately 
      12,450 UK homes for a year. 
 
   -- Two UK solar assets, Littlewood and Laurel Hill, were acquired by 
      existing portfolio companies in August and September 2017 respectively, 
      increasing the portfolio's capacity by 19.2MW. 
 
   -- In November 2017, our original portfolio companies completed the sale of 
      the four UK FiT solar assets. Our portfolio company, Shaftesbury Solar I 
      UK Holdings Limited, also invested GBP0.4 million in a 400kW rooftop 
      solar installation in Campania, Italy. 
 
   -- In January 2018, the subsidiary of our portfolio company Skibo Solar III 
      Limited completed the sale of the EOSOL solar asset in California. 
 
   -- Two interim dividends of 3.0p per Ordinary Share were paid during the 
      year, on 24 November 2017 and 27 April 2018. 
 
   -- Two interim dividends of 2.5p per C Share were paid during the year, on 
      24 November 2017 and 27 April 2018. 
 
   -- The Company completed a share class merger on 29 June 2018, where the C 
      and D Shares funds were merged with the Ordinary Shares fund, uniting the 
      shareholder base and pooling the assets of the fund. 
 
 
   Chairman's Statement 
 
   INTRODUCTION 
 
   I am pleased to present the Annual Report and audited accounts for 
Foresight Solar & Infrastructure VCT Plc and to provide you with an 
update on the progress made. During the year, the share class merger 
between the Ordinary, C and D Shares was completed, uniting the 
shareholder base and allowing for the fund to embark upon its next 
phase. At the operating level, the disposal by our original portfolio 
companies of their older Feed-in Tariff ("FiT") solar assets was 
completed at a favourable price. As discussed in the Investment 
Manager's Review, new projects were acquired by these companies with 
potential for further returns. These transactions will support the 
fund's objective of delivering an attractive return for investors. 
 
   PERFORMANCE 
 
   ORDINARY SHARES 
 
   The underlying net asset value increased by 3.1p per Ordinary Share 
before deducting the 6.0p per Ordinary Share dividend paid during the 
year. 
 
   This has been driven by the profitable sale by our original portfolio 
companies of their FiT assets in November 2017, generating proceeds of 
over GBP11m, as well as additional proceeds of over GBP1.5m received 
during the year from the sale of the fund's Italian solar assets 
initially sold in December 2016. These proceeds have been retained by 
the portfolio companies to finance new opportunities. 
 
   Additionally, an extension to the useful economic lives of the existing 
sites combined with improvements in the efficiency and revenue 
generation of these same sites, with support from the fund's Investment 
Manager, has driven an increase in valuation of the portfolio of 
GBP0.8m. 
 
   Existing portfolio companies also acquired two new UK solar plants 
during the year, the first being Littlewood in Mansfield, 
Nottinghamshire and the second being Laurel Hill near Donaghcloney, 
Northern Ireland. These two projects added a combined capacity of 
19.2MW. 
 
   In aggregate, following the share class merger with the C Shares and the 
D Shares funds, the Company ended the year with investments in portfolio 
companies with total generating capacity of 49.3MW compared with 41.2MW 
at 30 June 2017. 
 
   The overall performance of the Ordinary Shares fund remains robust and 
the total return since inception as at 30 June 2018 was 128.0p per 
Ordinary Share. 
 
   C SHARES 
 
   The C Shares had a total return of 104.2p per share at 29 June 2018 
(after deducting the performance incentive fee) compared to 105.1p per 
share at 30 June 2017. No new assets were acquired in this period. 
 
   D SHARES 
 
   The D Shares had a total return of 92.2p per share at 29 June 2018 
compared to 96.8p per share at 30 June 2017. During this period, 
Shaftesbury Solar I UK Holdings Limited, in which D Share money was 
invested, invested in a new rooftop solar project in Campania, Italy 
adding capacity of 400kW. 
 
   CASH & DEAL FLOW 
 
   The Company had cash and liquid resources of GBP4.9m at 30 June 2018 
(excluding cash held in portfolio companies). The Company receives 
regular interest and loan stock payments and dividends from its 
underlying investments enabling it to continue to fund its dividend 
policy as well as meeting expenses in the ordinary course of business as 
they fall due. 
 
   INVESTMENT GAINS & LOSSES 
 
   During the year the Company recognised unrealised gains of GBP0.8m. 
Further information regarding the breakdown of this amount is contained 
in the Investment Manager's Report. 
 
   DIVIDS 
 
   In its original prospectus the Board's stated objective was to pay 
dividends of 5.0p per Ordinary Share each year throughout the life of 
Foresight Solar & Infrastructure VCT plc after the first year. The level 
of dividends was not, however, guaranteed. 
 
   During the year and prior to the share class merger, total dividends of 
6.0p per Ordinary Share and 5.0p per C Share were paid. The Board is 
pleased to announce that the next interim dividend, of 3.0p per Ordinary 
Share, will be paid on 23 November 2018 based on an ex-dividend date of 
8 November 2018 and a record date of 9 November 2018. This means that 
total dividends of 38.0p per Ordinary Share will have been paid during 
the eight years since launch. 
 
   SHARE CLASS MERGER 
 
   On 29 June 2018, the C and D Shares funds were merged with the Ordinary 
Shares fund, based on the proportionate value of their respective 
shareholdings of Ordinary Shares, C Shares and D Shares as at 31 March 
2018, adjusted to take account of the 3.0p per Ordinary Share and the 
2.5p per C Share dividends paid on 27 April 2018, and other fund level 
movements up to the date of the merger. The conversion ratios were 
0.9057 for C shares and 0.9917 for D shares. On the basis of these 
conversion ratios, the Company's issued share capital was 43,911,189 
Ordinary Shares and 1,222,778 Deferred Shares. The Deferred Shares are 
not listed, and have no value attributable. 
 
   SHARE ISSUES & BUYBACKS 
 
   During the year under review, the Ordinary Shares fund repurchased 
298,622 shares for cancellation at a cost of GBP290,000 and the C Shares 
fund repurchased 37,677 shares for cancellation at a cost of GBP32,000, 
at an average discount to NAV of 2.6%. No new shares were issued. 
 
   A table of intended communications to shareholders and likely tender 
offers is included on page 17. 
 
   PERFORMANCE INCENTIVE FEE 
 
   Before the share class merger was implemented on 29 June 2018, the 
performance incentive hurdle for the C shares was satisfied, with a 
total return of 105.3p per share, resulting in an accrual of GBP130,000 
due to the Manager. This was paid post year end. 
 
   There were no performance incentive fees paid or accrued in respect of 
the Ordinary Shares or the D Shares. 
 
   Following the share class merger, the entire fund will apply the 
existing Ordinary Shares performance incentive fee arrangement. 
 
   ANNUAL GENERAL MEETING 
 
   The Company's Annual General Meeting will take place on 6 December 2018 
at 12.30pm. I look forward to welcoming you to the Meeting, which will 
be held at the offices of Foresight Group in London. 
 
   OUTLOOK 
 
   The strategic focus of the Board remains the optimisation of the 
portfolio's performance and valuation through a number of initiatives. 
In this respect, the Investment Manager continues to examine 
opportunities such as refinancing assets at lower interest rates and 
fixing power price agreements (PPAs) when they are deemed attractive. 
 
   Operationally we have benefitted from good irradiance conditions in the 
first quarter of the current year. 
 
   David Hurst-Brown 
 
   Chairman 
 
   31 October 2018 
 
 
 
   Investment Manager's Review 
 
   PORTFOLIO SUMMARY 
 
   In November 2017, our portfolio companies successfully sold four of the 
portfolio's solar assets, which qualified for the Feed-in Tariff ("FiT") 
subsidy, generating proceeds of over GBP11m. This was a profitable exit 
and the proceeds have been retained by our portfolio companies to 
finance new opportunities. 
 
   The Littlewood solar plant (5MW) in Mansfield, Nottinghamshire, was 
purchased from its constructor Goldbeck in August 2017. Littlewood 
presented an attractive investment opportunity given the quality of 
Goldbeck projects and the fact that Foresight already had precedent 
contracts from which to transact. The site connected to the grid in 
March 2017. 
 
   In September 2017, Laurel Hill, a 14.2MW construction stage solar plant 
located near Donaghcloney, Northern Ireland was acquired. The plant 
successfully connected to the grid at the end of February 2018, 
qualifying for 1.4 ROCs under the regime's grace period. The project was 
acquired from solar developer BNRG, which Foresight has worked with 
previously. 
 
   In January 2018, the subsidiary of our portfolio company Skibo Solar III 
Limited completed the sale of its interest in the 3.6MW EOSOL asset in 
California. The decision was taken to capitalise on the relative 
strength of the US dollar in comparison to sterling subsequent to the 
Brexit referendum of 2016, as well as the high demand for operational 
solar assets in the US. 
 
   In November 2017, Shaftesbury Solar I UK Holdings Limited, a portfolio 

company in which D Share money was invested, made an investment of 
GBP0.4m, to finance the construction of a 400kW rooftop solar 
installation in Campania, Italy. The solar panels are being installed on 
the roof of a building owned by Telecomponenti, which manufactures 
plastic products for the telecom and energy industry. This is the first 
unsubsidised solar site to be acquired by a portfolio company, with the 
majority of the electricity generated being sold to Telecomponenti at a 
fixed price under a long-term contract. Construction of the project 
completed in May 2018, and performance is in line with expectations. It 
is intended to fund a second stage, adding a further 500kW of capacity. 
 
   Previously, the discounted cash flow ("DCF") methodology used to value 
the assets assumed a 25-year asset life, with no residual value at the 
end of this period. This assumption was based on the market standard 
lease terms for the properties on which portfolio company solar assets 
are located and planning consent periods initially granted by local 
planning offices. 
 
   Some of the portfolio companies have secured lease and planning rights 
to extend the useful economic life of their solar assets across the 
majority of the portfolio by up to an extra ten years beyond this 
25-year period. Cash flows from the extended periods are now included in 
the DCF models. 
 
   PORTFOLIO PERFORMANCE 
 
   For the period 1 July 2017 to 30 June 2018 total electricity production 
was 0.3% below expectations, in line with irradiation levels that were 
also 0.3% below expectations. There will be annual movements in 
performance caused by irradiation or the efficiency of the plan but this 
does not require adjustment to the long term forecasts for the plants. 
Further details on performance is included on pages 10 to 13. 
 
   FOLLOWING PERIOD 
 
   Existing portfolio companies acquired four solar projects post period 
end: Basin Bridge, Stables, Dove View and Beech Farm. These projects 
were acquired from other funds managed by Foresight. Other existing 
portfolio companies completed their debt refinancing of the Laurel Hill 
site in August 2018, provided by Royal Bank of Scotland. The refinancing 
proceeds have been used to repay the majority of the borrowings 
originally taken to finance their acquisition of Littlewood and Laurel 
Hill. 
 
   REGULATORY AND MARKET CHANGES 
 
   During the second half of 2017, there was increased discussion about the 
future funding of the lowest cost renewables, onshore wind and solar. 
Government announcements coinciding with the results of the Contracts 
for Difference ("CfD") auction in September 2017 confirmed the 
expectation that solar and onshore wind will continue to be excluded 
from Pot 1 (established technologies) during the third auction round 
expected in Spring 2019 and are highly unlikely to feature in future 
auction rounds. However, as capex costs for battery storage continue to 
reduce, there is the possibility of co-locating battery facilities with 
solar projects, which could drive further market growth. 
 
   In October 2017, the release of the Clean Growth Strategy (the 
Government's plan to grow the UK's national income while cutting 
greenhouse gas emissions) also excluded any mention of future support 
for onshore wind and ground mounted solar. Although the lack of 
regulatory support for new large scale solar projects has halted the 
flow of primary solar assets to market, secondary market activity has 
increased considerably as investors have turned to the acquisition of 
existing operational assets currently being held by short term 
investors. 
 
   Despite the aforementioned developments, there has been growing support 
to reconsider the use of subsidies, including proposals for technology 
neutral auctions from diverse groups including backbench Conservative 
MPs, the Committee for Climate Change, Energy UK, Dieter Helm's cost of 
energy review and a variety of NGOs and energy trade associations. 
Meanwhile, a report from the Committee on Climate Change in June 2017 
highlighted that the UK is significantly behind its 2030 targets to 
reduce carbon emissions and could fail to meet the legally binding 
commitments set out in the UK's Fifth Carbon Budget. The UK government 
has recently agreed to increase the 2030 renewable energy target from 
27% to 32%, creating a clear opportunity for additional growth of the UK 
solar market in the medium to long-term. 
 
   In December 2017, Ofgem published a consultation which is broadly 
supportive of the co-location of battery storage facilities with ROC 
accredited renewable energy installations, lifting concerns that this 
could invalidate existing ROC accreditations. The Investment Manager 
will continue to monitor the progress of these market developments and 
its potential to accelerate the transition to a decentralised energy 
system. 
 
   In July 2018, Ofgem issued a consultation which proposes a Significant 
Code Review ("SCR") to address inefficiencies in network access and 
forward-looking network charging arrangements. If launched, this would 
run in parallel with the current SCR in progress and the Targeted 
Charging Review ("TCR") launched in August 2017, which encompasses a 
review of residual network charging arrangements. The impact of these 
review processes on charging arrangements for embedded generation has 
the potential to materially affect the embedded benefits received by the 
portfolio. 
 
   There remains political uncertainty following the UK's vote to withdraw 
from the European Union. Although formal Brexit negotiations started on 
19 June 2017, it remains unclear to what extent the UK power market will 
continue to be integrated with the wider EU power market and therefore 
what the impact on wholesale power prices will be. The Manager will 
continue to carefully monitor any potential political effects from 
Brexit, however current indications suggest that the UK Government 
remains committed to a carbon reduction agenda. 
 
   POWER PRICES 
 
   Following a winter of relatively high power prices, the spot price rose 
to GBP51 per MWh as at 30 June 2018 (GBP46 per MWh in June 2017). 
 
   The average power price achieved across the portfolio during the 
reporting period was GBP46.77 per MWh. 
 
   During the period 1 July 2017 to 30 June 2018 there was a downward 
movement of 7.3% in the medium to long term power price forecast. The 
Investment Manager uses forward looking power price assumptions to 
assess the likely future income of the portfolio investments for 
valuation purposes. The Company's assumptions are formed from a blended 
average of the forecasts provided by third party consultants and are 
updated on a quarterly basis. The Investment Manager's forecasts 
continue to assume an increase in power prices in real terms over the 
medium to long-term of 1.08% per annum (30 June 2017: 1.7%), driven by 
higher gas and carbon prices. 
 
   During the period, 75% of the Company's revenue from portfolio 
investments came from the FiT subsidy or sale of ROCs and other green 
benefits to an offtaker. These revenues are directly and explicitly 
linked to inflation for 20 years from the accreditation date under the 
ROC regime and subject to Retail Price Index ("RPI") inflationary 
increases applied by Ofgem in April of each year. 
 
   The majority of the remaining 25% of revenues derive from electricity 
sales by our portfolio companies which are subject to wholesale 
electricity price movements. Electricity prices in the UK are a 
component of the RPI index basket of goods and services and as a result 
present a degree of correlation with the long term RPI. This direct 
indexation of revenues derived from ROC benefits and the degree of 
inflation linkage of the wholesale electricity price provides 
correlation with long term inflation for a significant percentage of 
cash flows. 
 
   Power Purchase Agreements ("PPAs") are entered into between each 
portfolio company and offtakers in the UK electricity supply market. 
Under the PPAs, each portfolio company will sell the entirety of the 
generated electricity and ROCs to the designated offtaker. 
 
   The PPA strategy adopted by our portfolio companies seeks to optimise 
their revenues from the power generated, while keeping the flexibility 
to manage their solar assets appropriately. As at 30 June 2018, our 
portfolio companies put in place fixed power price arrangements in 
respect of their solar businesses operating on the Turweston site and 
floating rate PPAs, which track market power prices, in respect of their 
other solar businesses operating on other sites. 
 
   The boards of our portfolio companies, with assistance from Foresight, 
constantly assesses conditions in the electricity market and set their 
pricing strategy on the basis of likely future movements. Following the 
year end further fixed price arrangements have been entered into by our 
portfolio companies, offering a premium over the long-term power price 
forecasts. Four assets, including Turweston, representing c.31MW of 
installed capacity now have fixed price arrangements until December 
2019. 
 
   Our portfolio companies retain the option to fix the PPAs of their 
portfolio assets at any time. As part of the ongoing efforts by our 
portfolio companies to maximise the commercial performance of their 
businesses, they have undertaken a PPA tendering process across all 
their assets, which has seen a significant reduction in fees charged to 
them by the offtakers. 
 
   SUSTAINABLE INVESTING 
 
   Sustainability lies at the heart of the Manager's approach, and the 
Manager believes that investing responsibly, seeking to make a positive 
social and environmental impact, is critical to its long term success. 
These factors have been integrated into the investment process, and are 
actively supported by all involved, regardless of seniority. With that 
in mind, the Manager has adopted a Responsible Investment Framework to 
provide a suitable operational framework in matters related to the 

investment process, such that sustainability and sustainable investing 
has become part of the day-to-day operations. Further to the 
environmental advantages of large scale renewable energy, each 
investment is closely scrutinised for localised environmental impact. 
Where improvements can be made, the Manager will work with planning and 
local authorities to minimise visual and auditory impact of sites. 
 
   LAND MANAGEMENT 
 
   The Investment Manager is a working partner of the Solar Trade 
Association's Large Scale Asset Management Working Group. Foresight is a 
signatory to the Solar Farm Land Management Charter and seeks to ensure 
that the solar farms operated by all of our portfolio companies are 
managed in a manner that maximises the agricultural, landscaping, 
biodiversity and wildlife potential, which can also contribute to 
lowering maintenance costs and enhancing security. As such, the 
Investment Manager regularly inspects sites and advises portfolio 
companies to develop site specific land management and biodiversity 
enhancement plans to secure long term gains for wildlife and ensure that 
the land and environment are maintained to a high standard. This 
includes: 
 
 
   -- Management of grassland areas within the security fencing to promote 
      wildflower meadows and sustainable sheep grazing; 
 
   -- Planting and management of hedgerows and associated hedge banks; 
 
   -- Management of field boundaries between security fencing and hedgerows; 
 
   -- Sustainable land drainage and pond restoration; 
 
   -- Installation of insect hotels and reptile hibernacula; 
 
   -- Installation of boxes for bats, owls and kestrels; and 
 
   -- Installation of beehives by local beekeepers. 
 
 
   Most solar parks are designed to enable sheep grazing and the remaining 
plants are investigated for alterations to ensure that the farmland on 
which the solar assets are located can remain useful in agricultural 
production, which is a frequent desire of local communities. 
 
   SOCIAL AND COMMUNITY ENGAGEMENT 
 
   The Investment Manager actively seeks to engage with the local 
communities around the solar assets operated by our portfolio companies 
and regularly attends parish meetings to encourage community engagement 
and promote the benefits of their solar assets. 
 
   HEALTH AND SAFETY 
 
   There were no reportable health and safety incidents during the period. 
Safety, Health, Environment and Quality ('SHEQ") performance and risk 
management are a top priority at all levels for Foresight Group. To 
further improve the management of SHEQ risks, reinforce best practice 
and ensure non-compliance with regulations is avoided, the fund's 
Investment Manager has appointed an independent health and safety 
consultant who regularly visits the portfolio assets operated by our 
portfolio companies to ensure they not only meet, but exceed, industry 
and legal standards. The consultant has confirmed that all sites are in 
compliance with all applicable regulations. Recommendations that have 
been implemented to help raise standards further include improvements to 
the safety signage on the fence of two plants. 
 
   OUTLOOK 
 
   During the financial year ended 30 June 2018, as well as acquiring three 
new projects, we encouraged our portfolio companies to focus on the 
continued optimisation of the existing businesses, both from an 
operational perspective and in respect of their ability to support a 
sustainable level of debt to enhance returns to the fund. We encourage 
our portfolio companies to continue this, as well as to explore new 
acquisition opportunities which we believe will be accretive to the 
value of their businesses, and to the benefit of the fund's investment 
in them in the long term. 
 
   Dan Wells 
 
   Partner 
 
   31 October 2018 
 
   Income Statement 
 
   for the year ended 30 June 2018 
 
 
 
 
                             Year ended 30 June       Year ended 30 June 
                                    2018               2017 
                        Revenue   Capital    Total    Revenue   Capital    Total 
                         GBP'000   GBP'000   GBP'000   GBP'000   GBP'000   GBP'000 
Investment holding 
 gains                        --       835       835        --     7,938     7,938 
Realised losses 
 on investments               --        --        --        --   (3,318)   (3,318) 
Income                     1,543        --     1,543       871        --       871 
Investment management 
 fees                      (173)     (649)     (822)     (205)   (1,668)   (1,873) 
Loan interest 
 payable                   (371)        --     (371)      (30)        --      (30) 
Other expenses             (647)        --     (647)     (537)        --     (537) 
Profit before 
 taxation                    352       186       538        99     2,952     3,051 
Taxation                      --        --        --      (33)        33        -- 
Profit after taxation        352       186       538        66     2,985     3,051 
Profit per share: 
Ordinary Share              0.8p      0.4p      1.2p      0.3p      3.2p      3.5p 
 
 
   The total column of this statement is the profit and loss account of the 
Company and the revenue and capital columns represent supplementary 
information. 
 
   All revenue and capital items in the above Income Statement are derived 
from continuing operations. No operations were acquired or discontinued 
in the year. 
 
   The Company has no recognised gains or losses other than those shown 
above, therefore no separate statement of total recognised gains and 
losses has been presented. 
 
   Reconciliation of Movements in Shareholders' Funds 
 
 
 
 
                              Called-up   Share      Capital     Profit 
                                share     premium   redemption   and loss 
                               capital    account    reserve     account      Total 
  Year ended 30 June 2018      GBP'000    GBP'000    GBP'000     GBP'000     GBP'000 
 
As at 1 July 2017                   454     7,061          112     35,292     42,919 
Expenses in relation 
 to prior year share issues          --      (23)           --       (41)       (64) 
Repurchase of shares                (3)        --            3      (322)      (322) 
Share class merger                 (12)        12           --         --         -- 
Dividends                            --        --           --    (2,253)    (2,253) 
Profit for the year                  --        --           --        538        538 
As at 30 June 2018                  439     7,050          115    33,214*     40,818 
 
 
                              Called-up     Share      Capital     Profit 
                                  share   premium   redemption   and loss 
                                capital   account      reserve    account      Total 
  Year ended 30 June 2017       GBP'000   GBP'000      GBP'000    GBP'000    GBP'000 
 
As at 1 July 2016                   528     3,549            2     46,527     50,606 
Share issue in the year              36     3,673           --         --      3,709 
Expenses in relation 
 to share issues                     --     (161)           --      (194)      (355) 
Repurchase of shares              (110)        --          110   (10,986)   (10,986) 
Expenses in relation 
 to tender offer                     --        --           --      (184)      (184) 
Dividends                            --        --           --    (2,922)    (2,922) 
Profit for the year                  --        --           --    (3,051)    (3,051) 
As at 30 June 2017                  454     7,061          112    35,292*     42,919 
 
 
   *Of this amount GBP11,306,000 (2017: GBP14,219,000) is distributable. 
 
   Balance Sheet 
 
   at 30 June 2018 
 
   Registered Number: 07289280 
 
 
 
 
                               As at     As at 
                               30 June   30 June 
                                2018      2017 
                               GBP'000   GBP'000 
 
Fixed assets 
Investments held at fair 
 value through profit or 
 loss                           53,352    53,752 
 
Current assets 
Debtors                            465       432 
Money market securities 
 and other deposits                  9         9 
Cash                             4,844     5,694 
                                 5,318     6,135 
Creditors 
Amounts falling due within 
 one year                      (2,852)   (1,968) 
Net current assets               2,466     4,167 
 
Creditors 
Amounts falling due greater 
 than one year                (15,000)  (15,000) 
Net assets                      40,818    42,919 
 
Capital and reserves 
Called-up share capital            439       454 
Share premium                    7,050     7,061 
Capital redemption reserve         115       112 
Profit and loss account         33,214    35,292 
Equity shareholders' funds      40,818    42,919 
 
 
Net asset value per share 
Ordinary Share                   93.0p     95.9p 
 
 
 
   Cash Flow Statement 
 
   for the year ended 30 June 2018 
 
 
 
 
                                          Year      Year 
                                          ended     ended 
                                         30 June   30 June 
                                          2018      2017 
                                         GBP'000   GBP'000 
Cash flow from operating activities 
Deposit and similar interest received          8         1 
Investment management fees paid            (791)     (723) 
Performance incentive fee paid                --   (3,323) 
Secretarial fees paid                      (269)     (150) 
Other cash receipts/(payments)               107     (341) 
Net cash outflow from operating 
 activities                                (945)   (4,536) 
 
Cash flow from investing activities 
Purchase of investments                     (97)      (32) 
Net proceeds on sale of investments        1,332     2,649 
Investment income received                 1,515     1,047 
Net cash inflow from investing 
 activities                                2,750     3,664 

--------------------------------------  --------  -------- 
 
Cash flow from financing activities 
Proceeds of fund raising                      --     4,058 
Proceeds from borrowings on long 
 term debt                                    --    15,000 
Expenses of fund raising                    (80)     (298) 
Expenses in relation to tender 
 offer                                        --     (156) 
Repurchase of own shares                   (322)  (10,986) 
Equity dividends paid                    (2,253)   (2,923) 
Net cash (outflow)/inflow from 
 financing activities                    (2,655)     4,695 
Net (outflow)/inflow of cash in 
 the year                                  (850)     3,823 
 
Reconciliation of net cash flow 
 to movement in net funds 
(Decrease)/increase in cash for 
 the year                                  (850)     3,823 
Net cash and cash equivalents 
 at start of year                          5,703     1,230 
Net cash and cash equivalents 
 at end of year                            4,853     5,703 
 
 
 
 
 
 
Analysis of changes in net cash 
                                      Cash 
                   At 1 July 2017     flow    At 30 June 2018 
                       GBP'000       GBP'000      GBP'000 
 
Cash and cash 
 equivalents*                5,703     (850)            4,853 
 
 
   *Including money market securities and other deposits 
 
   Notes to the accounts 
 
   1.     The audited Annual Financial Report has been prepared on the 
basis of accounting policies set out in the statutory accounts of the 
Company for the year ended 30 June 2018.  All investments held by the 
Company are classified as 'fair value through the profit and loss'. 
Unquoted investments have been valued in accordance with IPEVC 
guidelines, as updated in December 2015. Quoted investments are stated 
at bid prices in accordance with the IPEVC guidelines and Generally 
Accepted Accounting Practice. 
 
   2.    These are not statutory accounts in accordance with S436 of the 
Companies Act 2006. The full audited accounts for the year ended 30 June 
2018, which were unqualified and did not contain any statements under 
S498(2) or S498(3) of Companies Act 2006, will be lodged with the 
Registrar of Companies. Statutory accounts for the year ended 30 June 
2017 including an unqualified audit report and containing no statements 
under the Companies Act 2006 will be delivered to the Registrar of 
Companies in due course. 
 
   3.    Copies of the Annual Report will be sent to shareholders and will 
be available for inspection at the Registered Office of the Company at 
The Shard, 32 London Bridge Street, London, SE1 9SG and can be accessed 
on the following website: 
https://www.globenewswire.com/Tracker?data=WoO3hAcrjA1B1sFslqV3D2TwpfX8Yrlog0odvuo8rYSKYKf4aGuryMz6935iGfwyUg81OL0FZb20EA8TbWZacRVBhR8BnLndbsEeOmDg4ec= 
www.foresightgroup.eu 
 
   4.    Net asset value per share 
 
   Net asset value per Ordinary Share is based on net assets at the year 
end of GBP40,818,000 (2017: GBP26,197,000) and on 43,911,189 Ordinary 
Shares (2017: 27,324,838), being the number of Ordinary Shares in issue 
at that date. 
 
   5.    Return per share 
 
 
 
 
                             Year ended 
                              30 June    Year ended 30 June 
                              2018        2017 
                               Ordinary   Ordinary 
                                 Shares    Shares      C Shares   D Shares 
                                GBP'000    GBP'000     GBP'000     GBP'000 
 
Total profit/(loss) after 
 taxation                           538       1,305       1,862      (116) 
Total profit/(loss) per 
 share (note a)                    1.2p        3.5p       14.9p     (3.1)p 
Revenue profit/(loss) 
 from ordinary activities 
 after taxation                     352         128           3       (65) 
Revenue profit/(loss) 
 per share (note b)                0.8p        0.3p        0.0p     (1.7)p 
Capital profit/(loss) 
 from ordinary activities 
 after taxation                     186       1,177       1,859       (51) 
Capital profit/(loss) 
 per share (note c)                0.4p        3.2p       14.9p     (1.4)p 
Weighted average number 
 of shares in issue during 
 the year (note d)           45,273,865  37,041,226  12,509,247  3,761,042 
 
 
   Notes: 
 
   a) Total profit/(loss) per share is total profit/(loss) after taxation 
divided by the weighted average number of shares in issue during the 
year. 
 
   b) Revenue profit/(loss) per share is revenue profit/(loss) after 
taxation divided by the weighted average number of shares in issue 
during the year. 
 
   c) Capital profit/(loss) per share is capital profit/(loss) after 
taxation divided by the weighted average number of shares in issue 
during the year. 
 
   d) The weighted average number of shares has been adjusted to take 
account of the O, C and D share class merger on 29 June 2018. 
 
   6.    The Annual General Meeting will be held at 12.30pm on 6 December 
2018 at the offices of Foresight Group LLP, The Shard, 32 London Bridge 
Street, London, SE1 9SG. 
 
   7.    Income 
 
 
 
 
                       Year ended  Year ended 
                         30 June     30 June 
                          2018        2017 
                         GBP'000     GBP'000 
 
Loan stock interest           572         786 
Dividends receivable          963          84 
Bank interest                   8           1 
                            1,543         871 
---------------------  ----------  ---------- 
 
 
   8.    Investments held at fair value through profit or loss 
 
 
 
 
                                    Ordinary 
                                     Shares   C Shares  D Shares 
                                      Fund      Fund      Fund    Company 
Company                              GBP'000   GBP'000   GBP'000   GBP'000 
Book cost at 1 July 2017              22,743     8,316     1,620    32,679 
Investment holding gains              17,762     3,311        --    21,073 
Valuation at 1 July 2017              40,505    11,627     1,620    53,752 
Movements in the period: 
Purchases at cost*                        97        --        --        97 
Disposal proceeds                      (369)     (963)        --   (1,332) 
Investment holding gains/(losses)      1,516     (609)      (72)       835 
Transfer to Ordinary 
 Shares fund -- book cost              8,973   (7,353)   (1,620)        -- 
Transfer to Ordinary 
 Shares fund -- investment 
 holding gains/(losses)                2,630   (2,702)        72        -- 
Valuation at 30 June 
 2018                                 53,352        --        --    53,352 
----------------------------------  --------  --------  --------  -------- 
Book cost at 30 June 
 2018                                 31,444        --        --    31,444 
Investment holding gains              21,908        --        --    21,908 
Valuation at 30 June 
 2018                                 53,352        --        --    53,352 
 
 
   *Purchases at cost represents costs incurred in relation to the 
underlying FiT assets and refinancing of Turweston asset held by 
portfolio companies. 
 
   9.    Transactions with the manager 
 
   Details of arrangements with Foresight Group LLP, Foresight Fund 
Managers Limited and Foresight Group CI Limited are given in the 
Directors' Report and Notes 3 and 13. All arrangements and transactions 
were on an arms length basis. 
 
   Foresight Group, which acts as investment manager to the Company, earned 
fees of GBP692,000 in the year (2017: GBP820,000). At the year end date, 
amounts due from Foresight Group in respect of management fees were 
GBP2,000 (2017: GBP104,000 payable to Foresight Group). It also earned 
performance incentive fees of GBP130,000 (2017: GBP1,053,000), all of 
which was payable at the year end (2017: GBPnil). 
 
   Foresight Fund Managers Limited, Company Secretary until November 2017, 
earned fees of GBP100,000 (2017: GBP211,000) during the year, of which 
GBPnil (2017: GBP61,000) remained payable at the year end date. 
Foresight Group LLP was appointed Company Secretary in November 2017 and 
received fees of GBP102,000 (2017: GBPnil) during the year, of which 
GBP2,000 (2017: GBPnil) remained payable at the year end date. 
 
   Foresight Group recharged fund expenses incurred on behalf of the 
Company of which GBP158,000 (2017: GBP53,000) remained payable at the 
year end date. 
 
   END 
 
 
 
 

(END) Dow Jones Newswires

October 31, 2018 12:14 ET (16:14 GMT)

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