Foresight Solar & Technology VCT plc - Annual Report
FORESIGHT SOLAR & TECHNOLOGY VCT
PLC
Ordinary Shares Total Net Assets as at 31 March 2022:
£37.1mOrdinary Shares Net Asset Value per share as at 31 March
2022: 107.3pForesight Williams Technology Shares Total Net Assets
as at 31 March 2022: £16.6mForesight Williams Technology Shares Net
Asset Value per share as at 31 March 2022: 97.4p
Ordinary Shares Fund
- Net Asset Value per Ordinary Share at 31 March 2022 was 107.3p
(31 March 2021: 68.9p).
- At 31 March 2022, the fund held positions in 11 UK solar
assets, with a total installed capacity of 69.7MW.
- As communicated in December 2021, the Board and the Investment
Manager are in the process of realising the Solar portfolio with
the objective to return value to all Ordinary shareholders.
Foresight Williams Technology Shares Fund
- During the year, under the Offers for subscription for the
Foresight Williams Technology Shares fund (the “FWT Shares fund”),
dated 30 December 2020 and 5 January 2022, £6.8m of new funds were
raised.
- During the year, the fund invested in eleven new portfolio
companies as well as executed a follow on investment into one
existing portfolio company.
- Since the end of the reporting period, a further £1.7m has been
raised, bringing the total funds raised to £18.8m.
- Since the end of the reporting period, a further nine
investments have been made, bringing total deployment to
£13.1m.
Chairman’s Statement
On behalf of the Board, I am pleased to present the Annual
Report and Accounts for Foresight Solar & Technology VCT Plc
for the year ended 31 March 2022 and to provide you with an update
on the developments affecting the Company.
As with previous recent publications, my introduction to the
Annual Report and Accounts will be split between the two share
classes, the Ordinary Shares and the FWT Shares, with a general
section for the Company as a whole at the end.
ORDINARY SHARES
Performance and portfolio
activityThe Ordinary Shares fund performed strongly during
the year benefitting from robust asset availability, rising power
prices throughout the period, increased short-term forward power
prices and above budget inflation. This resulted in a Net Asset
Value total return increase for the year of 33.4% and earnings per
share of 38.3p, representing excellent financial performance well
ahead of base case.
As pandemic restrictions around the world eased, industrial and
commercial activity ramped up, leading to increased demand for
electricity. Power prices, already at pre-pandemic high levels at
the start of 2021, continued to rise during the year resulting in
record high wholesale energy prices in the UK and western Europe.
This was predominantly driven by the reduced supply of natural gas,
coupled with low reserves, higher pent-up demand and low wind
levels in northern Europe during the summer months.
The Russian invasion of Ukraine in February 2022 further pushed
wholesale energy prices higher resulting in a further increase in
the valuation of the underlying assets.
The Company remained well protected from downside risk in the
electricity markets during the pandemic as it secured a high
proportion of its revenues through advanced fixed price agreements.
The Company actively seeks to maintain an element of its revenues
with exposure to merchant power prices, thereby keeping some
generation unhedged, a decision which proved beneficial given
rising energy prices. The Company further capitalised on the
current power price environment by increasing the level of future
fixed rate power price agreements at prices significantly above
forecasts.
There were no new acquisitions in the UK portfolio during the
year. As reported in the Interim Report to 30 September 2021, the
Board and the Investment Manager commenced the process of realising
the solar assets towards the end of 2021 with the objective to
return value to all Ordinary Shareholders. At the time of writing,
the process remains ongoing with interest from several parties, and
is expected to conclude in the coming months. With the recovery in
long term power prices and the buoyant energy market in general,
the Board is confident this remains an optimal time to conduct such
a process and maximise shareholder value.
As reported in previous reports, following the Company’s long
running arbitration case with the Spanish Government with respect
to retrospective changes to feed-in-tariffs on its previously held
Spanish assets and the subsequent award of the claim (equivalent to
£2m-£2.5m, or 5.8-7.2p per Ordinary Share), the Company continues
to follow up this claim in the courts. As such, the Board has not
assigned any current value to the claim in the net asset value
reported. In the context of the wider portfolio realisation and
resulting return of proceeds to shareholders, in the event that
proceeds are recovered from this claim, the Board are considering
methods to return this to shareholders.
The overall performance of the Ordinary Shares remains robust
and the total return since inception as at 31 March 2022 was 153.3p
per Ordinary Share.
Cash and working capitalThe Ordinary Shares had
cash and liquid resources of £0.1m at 31 March 2022 (excluding cash
held in portfolio companies who have the ability to repay interest
and dividends when required).
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.
Management feesThe annual management fee of the
Ordinary Shares fund is calculated as 1.5% of Net Assets and
equated to £427,000 during the year.
In the context of realisations achieved during the fund’s life
and the continuing professional management of the portfolio, the
Board believe that the annual management fee represents good value
for investors.
Green Economy Mark
The Board is pleased that the Company continues
to be classified as a Green Economy Issuer by the London Stock
Exchange (“LSE”). This is an initiative launched by the LSE
supporting sustainable finance on its markets. The Green Economy
Mark recognises listed companies with 50% or more of revenues from
environmental solutions.
FWT SHARES The Foresight
Williams Technology VCT share class (the “FWT Shares”) was launched
in December 2019, and represents an exciting investment opportunity
made possible by the collaboration between Foresight Group and
Williams Advanced Engineering (‘WAE’), a technology and engineering
services business, originally spun out of the Williams Formula One
business.
The share class provides investors with the opportunity to
invest in a portfolio of early-stage companies with high
growth-potential, developing innovative and occasionally
transformational technologies across a range of different sectors.
It builds on the successful relationship that Foresight and WAE
have enjoyed from their launch of the Foresight Williams Technology
EIS Fund (the ‘EIS fund’) in November 2016, which has raised over
£50 million to date and has made over thirty investments across a
range of different sectors so far, and recently completed its first
exit achieving a gross return of over 16x.
Fundraising and share issuesThe Offers for
subscription, dated 30 December 2020 and relaunched on 5 January
2022, are each up to £20 million (with an overallotment facility
for up to an additional £10 million) through the issue of FWT
Shares. During the year, across both Offers, 7.0 million FWT Shares
were allotted, raising a further £6.8m, bringing the total funds
raised to over £17m.
Post year end, a further 1.7 million FWT Shares were allotted,
increasing the total funds raised to £18.8m.
Portfolio and deal activityThe FWT Shares fund
had a busy year deploying the funds raised, completing eleven new
investments and one follow-on investment costing £6.3m and £0.8m
respectively.
Post year end, the FWT Shares made investments in seven new
companies and two follow on investments, bringing total deployment
to £13.1m. Further details of these deals are included in the
Investment Manager’s review.
The Board and the Investment Manager are confident that a number
of new and follow-on investments can be achieved this year,
particularly with the investment activity noted above. Details of
each of these new and existing portfolio companies can be found in
the Investment Manager’s Review. The Investment Manager continues
to see a strong pipeline of potential investments sourced through
its regional networks and well developed relationships with
advisers and the SME community; however, it is also focused on
supporting the existing portfolio through the pandemic. Following
the fundraising over the last couple of years as well as the
fundraising for the ongoing January 2022 offer, the Company is in a
position to fully support the portfolio, where appropriate, and
exploit potential attractive investment opportunities.
Management feesThe annual management fee of the
FWT Shares fund is calculated as 2.0% of Net Assets and equated to
£265,000 during the year.
COMPANY
Annual General MeetingThe Company’s Annual
General Meeting will take place on 27 September 2022 at 12.30pm and
we look forward to meeting as many of you as possible in person,
providing rules permit. Please refer to the formal notice on pages
92 to 95 of the Annual Report and Accounts for further details. We
would encourage those of you who are unable to attend to submit
your votes by proxy ahead of the deadline of 1.00pm on 23 September
2022 and to forward any questions by email to
InvestorRelations@foresightgroup.eu in advance of the meeting.
OutlookThe Board continue to monitor the events
unfolding in Ukraine and the impact on the Ordinary Shares
portfolio while continuing to optimise the assets ahead of the
proposed realisation and return of funds to Ordinary
Shareholders.
The Company will also continue to raise new funds in the FWT
Shares fund and seek appropriate qualifying investments for this
share class.
Ernie RichardsonChairman
17 August 2022
Investment Manager’s Review – Ordinary
Shares
Portfolio Summary and
PerformanceOver the past year, the Investment Manager has
focused on delivering positive operational performance from the
assets within the portfolio while preparing the portfolio for sale.
The portfolio performed well with production above budget aided by
high levels of solar irradiation which was 4.1% above forecast for
the year.
The assets in the portfolio achieved a strong performance during
the year despite short production outages occurring at several
sites due to grid outages which particularly affected the largest
site in the portfolio, Turweston.
Unavailability due to technical issues related to the parks
themselves were few as expected in such a mature portfolio. Further
details on performance of the individual assets are included on
pages 12 to 17. The operation of the assets throughout the year
continued to be largely unaffected by issues arising from the
COVID-19 pandemic.
There were no acquisitions or disposals of sites during the
year.
Market UpdatePower PricesThe
rebound in economic activity early in the year saw power prices
return to pre-pandemic levels through spring and summer 2021.
Global gas prices continued to rise throughout autumn causing power
prices to rise across much of the world. In the UK, this coincided
with an unusually large amount of generating capacity offline after
summer and the lowest wind resource seen for many years throughout
winter. The combined effect of these factors saw record power
prices in the UK during the second half of the year – price levels
that have only slightly ebbed at the time of writing due to
continued tightness in gas supply exacerbated by the war in
Ukraine.
InflationAside from power prices, general measures of inflation
rose to levels not seen for decades. One such measure, the Retail
Price Index (“RPI”), is used to escalate the base price for ROCs,
the green certificates that the projects in this portfolio benefit
from. This inflation, and expectations of it continuing for at
least a short period, have had a positive effect on the valuation
of the portfolio’s assets.
Green Investment
Governments in the UK and across Europe continue
to remain supportive of the renewables sector, such support growing
in the wake of the pandemic and moreso following the commencement
of the war in Ukraine. While this fund cannot invest further into
new solar parks, such strong messaging from governments does appear
to steer more capital towards investing in renewables and hence be
supportive of valuations for existing asset portfolios.
Revenues Revenues within the portfolio exceeded
forecast by 40% during the year. This was primarily driven by high
power prices on top of strong operating performance. The fund had a
portion of power prices fixed for the year with some exposure left
to market power prices.
Approximately half of revenue from the portfolio’s investments
came from subsidies (predominantly under the ROC scheme) and other
green benefits. These revenues are directly and explicitly linked
to inflation for 20 years from the accreditation date under the ROC
regime and subject to RPI inflationary increases applied by Ofgem
in April of each year. Thus the extraordinary increases in RPI
during the year did not affect the ROC revenues achieved in the
year but have increased the ROC price currently being received and
that which will be applicable for the remainder of the life of the
ROC regime.
The average power price achieved during the year was £96.84 per
MWh, representing the highest power prices ever seen in the UK. The
average monthly price peaked in March 2022 at £156.93 per MWh.
There remains volatility and uncertainty about
market factors affecting power prices in the short to medium term.
The Investment Manager continues to monitor these to seek the best
opportunities to enter into short term price fixing arrangements
when they arise. A majority of the portfolio’s power output is
contracted at fixed power prices for the year ahead at levels more
than double those of previous years. A combination of these prices
and the high level of RPI ensured substantially higher than
forecast revenues for the year ahead.
ValuationMarket valuations for
solar parks are typically based on assessments of future cashflow
generation over the life of the projects. Rising inflation and
rising power price forecasts have been very supportive of higher
market valuations for the fund’s assets. Increased investor
appetite for the assets has also had a positive impact on
valuations. These factors as well as strong operating performance
and cash generation have led to rising valuations for the Ordinary
Shares fund overall.
Portfolio SaleIn keeping with
the intentions set out over the two years since the last tender
offer, the portfolio is being prepared for sale. Given the strong
growth in asset value, the Board and the Investment Manager
considers that 2022 remains an optimum time to pursue a sale of
this mature portfolio. A sale process was commenced earlier this
year and is ongoing with interest from several parties. It is
anticipated that a sale will be concluded by September 2022 and the
proceeds returned to investors shortly thereafter.
Sustainable
InvestingSustainability 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 its investment and asset management processes.
Foresight continues to refine its evaluation of the sustainability
considerations of all of its investments so as to demonstrate more
comprehensively the environmental benefits and social contribution
of all assets managed by Foresight, including this solar
portfolio.
Land ManagementCompliance
audits have been carried out on all UK sites held by portfolio
companies, confirming that they are in line with government permits
and conditions. Foresight Group remains 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, Foresight Group 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
- 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.
Examples of sustainable land management
activities across the portfolio include:
-
- Free-range chickens grazing at the New Kaine site
- The grounds of Turweston continue to be managed as wildflower
meadow
- Beehives are on site at Turweston
- Bird and bat boxes have been installed at Basin Bridge
- At Turweston additional gates with sufficient gaps at the lower
edge were installed to allow for safe wildlife passage across the
site
- Trees and hedgerows have been planted, and hedge infill work
undertaken at Dove View and Hurcott.
Social and Community
EngagementForesight Group 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 SafetyHealth and
safety audits have been carried out at all assets during the period
and there have been no reportable or material health and safety
incidents. 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, Foresight Group continues to work with
independent health and safety consultants who regularly visit the
assets operated by our portfolio companies to ensure they not only
meet, but exceed, industry and legal standards. The consultants
have confirmed that all sites are compliant with applicable
regulations.
OutlookIt has been another
positive year for the Ordinary Shares fund with strong performance
from the assets and, combined with supportive external factors,
this has led to rising valuations for the portfolio. The outlook
continues to be cautiously optimistic that recent valuation
increases can be maintained. Power prices remain at elevated levels
and the macro drivers to this do not appear to be dissipating at
the time of writing. With interest rates rising there is a
likelihood of declining economic growth and for inflation to return
to more usual levels. Our valuations assume that inflation is
swiftly brought under control and that power prices remain high in
the near term. On balance however, given the tenure of this fund,
it remains appropriate to pursue a sales process. In the meantime,
the Company will continue to focus on delivering strong operational
performance across the portfolio.
Foresight Group LLPInvestment Manager
17 August 2022
Investment Manager’s Review – Foresight
Williams Technology Shares
SummaryBetween its launch on 20 December 2019
and the end of the reporting period, the FWT Shares fund has raised
£17.1 million. The Offer provides investors with the opportunity to
invest in a portfolio of early-stage companies with high
growth-potential, developing innovative and occasionally
transformational technologies across a range of different sectors.
As at 31 March 2022, the FWT fund had made 15 investments totalling
£8.6 million:
Kognitiv Spark: a software company that provides 3D data to
support field service workers in remote locations.
Additive Manufacturing Technologies (AMT): a manufacturer of
systems that automate the postprocessing of 3D printed parts e.g.
unpacking, surface smoothing, sealing and colouring.
VividQ: a technology company enabling the next generation of
holographic displays.
Zero Point Motion: a developer of a chip-scale unit for
ultraprecise motion-tracking and indoor navigation.
Refeyn: a University of Oxford spin-out developing a new
generation of biomolecule analysis instrumentation based on
weighing molecules using light, known as mass
photometry.
Previsico: a University of Loughborough spin-out providing a
market-leading flood forecasting and warning software
platform.
Rovco: a sub-sea computer vision and robotics technology company
focused on marine surveys in offshore wind and oil field
decommissioning.
dRISK: an AI company accelerating the training of autonomous
vehicles on how to avoid unexpected, real-world “edge case” or
hazardous scenarios.
Cambridge GaN Devices: a developer of a new generation of
gallium nitride semiconductor power devices.
Audioscenic: a University of Southampton spin-out applying
computer vision software to create 3D immersive audio experiences
initially in consumer soundbars.
Insphere: a provider of in-process measurement systems that
speed up the calibration and enhance the accuracy of automated
production lines.
Oxford Space Systems: a satellite component company developing
stowable and deployable booms and antennas.
Forefront RF: a manufacturer of next generation RF modules,
small electrical devices that transmit and/ or receive radio
signals between devices, reducing component size, cost and supply
chain waste, and enabling geographically agnostic
smartphones.
Machine Discovery: a University of Oxford spin-out developing
machine learning technology that simplifies, automates and
accelerates highly complex computer simulations.
Vector Photonics: a University of Glasgow spin-out
commercialising the next generation of semiconductor laser
devices.
Post year end acquisitionsSubsequent to the
year end, the FWT fund has made seven new investments described
further below, and two follow on investments into Cambridge GaN
Devices Limited and Forefront RF Limited. This brings total
deployment to £13.1m.
NebuflowNebuflow is developing surface acoustic
wave nebulisers to enable the delivery of next-generation
respiratory pharmaceuticals and improve the efficiency of
well-established treatments. Nebulisers are used by patients with
Cystic Fibrosis and Chronic Obstructive Pulmonary Disorder as they
can deliver drugs directly into the patients’ lungs. However,
commercially available nebulisers are inefficient, bulky and
unsuitable for use with the next generation of pharmaceuticals,
which are already reaching clinics. Nebuflow’s patented technology
overcomes these issues providing a tightly controlled distribution
of droplet sizes using a technique compatible with new
pharmaceuticals based around RNA and antibodies, known as
biologics. The nebuliser device housing is a critical element to be
developed and WAE has expertise in computational fluid dynamic
simulations, a skillset which will be required to optimise the
housing design.
SalvalcoSalvalco develops innovative valve
systems, called Eco- Valve, based on prior research by the Spray
Research Group at Salford University. The Eco-Valve technology
allows eco-friendly inert gases such as nitrogen or simple fresh
air to be used as propellants in aerosol sprays, thus enabling a
more sustainable and safer alternative to conventional aerosol
propellants.
Salvalco has subsequently developed a family of valves using
this technology to pressurise the can without compromising user
experience. The company has secured a significant investment from
Beiersdorf, a leading provider of skincare products, including
brands such as NIVEA, Eucerin and La Prairie and launched a new and
eco-friendly NIVEA deodorant.
OpsydiaOpsydia has developed a laser-based
technology that rapidly and accurately performs sub-surface marking
of diamonds and other gemstones. As with many raw materials
markets, the global gemstone market is under increasing pressure to
provide greater transparency and full traceability. Opsydia’s
sub-surface inscription marks cannot be tampered with or removed
without destroying the value of the stone, providing diamond
producers with a robust and immutable method of connecting a
physical stone with its certificate of origin, and offering
high-end brands the means to differentiate their products.
Opsydia’s core technology, licensed from the University of Oxford,
uses an optical system to pre-correct for the expected aberration
of the laser that occurs when it passes through the surface of the
diamond. The technology has now been commercialised and the company
already sells the marking systems to several international diamond
producers.
Open BionicsOpen Bionics is a designer and
manufacturer of the world’s first clinically approved 3D-printed
bionic limbs with multi-grip functionality and empowering
aesthetics. The company’s core product is the Hero Arm, a
life-changing myoelectric prosthesis for below-elbow amputee adults
and children aged eight and above. Open Bionics’ goal is to open
the bionics market to a much wider audience by offering an
affordable product made using the unique approach of 3D printing
and digital scanning. The key enabling technology behind the
company’s prosthetics is its proprietary automation software that
generates bespoke designs for bionic arm sockets and frames from a
3D scan of a user’s remaining arm. It also tailors the designs to
be 3D-printable, while maintaining socket comfort and functionality
for the user, and allowing for personalised and aesthetically
appealing designs.
MiricoMirico is one of the top emerging climate
tech companies in the PwC Future 50 report published earlier in the
year. The company provides ultra-high sensitivity gas detection and
quantification services in the most challenging weather conditions.
Mirico’s unique Laser Dispersion Spectroscopy technology for gas
analysis is covered by six patents, five licensed from Rutherford
Appleton Laboratory and one owned by Mirico. By providing reliable
continuous monitoring of greenhouse gas emissions across a range of
industries and applications globally, Mirico addresses the
significant increase in the need for organisations to demonstrate
progress towards net zero goals and accelerate the uptake and
efficiency of climate change monitoring.
NovosoundNovosound is a technology spinout from
the University of West of Scotland that has developed a novel
technology for use in ultrasound sensors. The Company designs and
manufactures a thin-film core material that is flexible, extreme
temperature resistant, lightweight, low profile, compact, and
capable of producing high resolution images. Novosound’s ultrasound
solutions are used in a variety of applications in industrial,
medical, dental, and veterinary industry settings.
Living OpticsLiving Optics is a University of
Oxford spin-out commercialising next generation hyperspectral
imaging technology. The company’s hyperspectral camera system
promises to capture higher resolution images, faster, at lower cost
and in a more compact form factor than incumbent camera systems.
The technology is attracting strong interest from potential
customers in defence and industrial applications and prototypes
cameras have been successfully deployed in paid trials.
FundraisingThe Offer, made possible through an
innovative collaboration between Foresight Group and Williams
Advanced Engineering Ltd, continues to build positive momentum in
the market. Since the end of the year to 31 March 2022, a further
£1.7 million has been raised, bringing the total raised to £3.5
million in the current fund raising round and £18.8 million
overall.
Climate Change StatementThe Investment Manager
has a long-term investing vision and its strategy aligns with the
UN’s Sustainable Development Goals and the decarbonisation targets
set out in the Paris Agreement of 2015. As such, taking actions to
mitigate the risks posed by climate change, whilst also investing
to generate commercial returns for our investors, must be done hand
in hand. The Manager has been a signatory to the United
Nations-backed Principles for Responsible Investment (“PRI”) since
2013. PRI is a globally recognised voluntary framework concerned
with the incorporation of ESG considerations into the investment
decision-making process. It provides a basis for potential and
existing investors to judge the quality of a company’s ESG
processes and positioning within an industry sector. In 2020, the
Manager received an “A+” for Strategy and Governance, and “A” for
Private Equity and Infrastructure investments.
The Board supports the Manager’s views on climate change and ESG
and its vigorous process in the evaluation of an asset’s
environmental and social impact during due diligence and
thereafter. For each material risk identified during due diligence,
a mitigation plan is proposed in the investment submission and
these actions form part of each portfolio company’s “100-day plan”
post-investment.
From an environmental perspective, analysis relating to the
implementation of good industry practice in limiting and mitigating
the potentially adverse environmental impact of a company’s
operations has four principal components:
-
- Environmental policy and track record
- Energy and resource usage and environmental impact
- Environmental impact of products and services
- Environmental performance improvements
Regular monitoring post-investment ensures that standards are
maintained in respect of ESG issues where there is a change in
either the regulatory or operating environment or the composition
of the management team.
PipelineThe Investment Manager has a strong
pipeline covering new deals and EIS portfolio follow-ons. At the
time of writing, three deals had passed the Investment Manager’s
final Investment Committee stage and were nearing completion. On
three further deals, terms and exclusivity had been agreed and,
subject to Investment Committee approval, were progressing to due
diligence.
Foresight Group LLPInvestment Manager17 August 2022
Unaudited Non-Statutory Analysis of the
Share Classes
Income Statement |
|
|
|
|
|
|
for the year ended 31 March 2022 |
|
|
|
|
|
|
|
Ordinary Shares |
FWT Shares |
|
Revenue |
Capital |
Total |
Revenue |
Capital |
Total |
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
Investment
holding gains |
— |
14,323 |
14,323 |
— |
643 |
643 |
Realised losses
on investments |
— |
(1,121) |
(1,121) |
— |
— |
— |
Income |
901 |
— |
901 |
1 |
— |
1 |
Investment
management fees |
(107) |
(320) |
(427) |
(66) |
(199) |
(265) |
Other expenses |
(332) |
— |
(332) |
(129) |
— |
(129) |
Profit/(loss) before taxation |
462 |
12,882 |
13,344 |
(194) |
444 |
250 |
Taxation |
— |
— |
— |
— |
— |
— |
Profit/(loss) after taxation |
462 |
12,882 |
13,344 |
(194) |
444 |
250 |
Profit/(loss) per share |
1.3p |
37.0p |
38.3p |
(1.4)p |
3.2p |
1.8p |
Balance Sheet |
|
|
|
|
|
|
at 31 March 2022 |
|
|
|
|
|
|
|
|
|
|
Ordinary Shares |
|
FWT Shares |
|
|
|
|
£'000 |
|
£'000 |
Fixed assets |
|
|
|
|
|
|
Investments held at fair value through profit or loss |
|
|
|
37,035 |
|
9,196 |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
Debtors |
|
|
|
355 |
|
300 |
|
|
|
|
|
|
|
Money market securities and other deposits |
|
|
|
|
|
|
Cash and cash equivalents |
|
|
|
60 |
|
7,154 |
|
|
|
|
415 |
|
7,454 |
Creditors |
|
|
|
|
|
|
Amounts falling due within one year |
|
|
|
(339) |
|
(28) |
Net current assets |
|
|
|
76 |
|
7,426 |
Net assets |
|
|
|
37,111 |
|
16,622 |
|
|
|
|
|
|
|
Capital and reserves: |
|
|
|
|
|
|
Called-up share
capital |
|
|
|
346 |
|
171 |
Share
premium |
|
|
|
— |
|
13,998 |
Capital
redemption reserve |
|
|
|
208 |
|
— |
Distributable
reserve |
|
|
|
36,046 |
|
2,066 |
Capital
reserve |
|
|
|
(13,951) |
|
(256) |
Revaluation
reserve |
|
|
|
14,462 |
|
643 |
Equity shareholders' funds |
|
|
|
37,111 |
|
16,622 |
|
|
|
|
|
|
|
Net asset value per share |
|
|
|
107.3p |
|
97.4p |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
At 31 March 2022 there was an inter-share
debtor/creditor of £213,000 which has been eliminated on
aggregation.
Unaudited Non-Statutory Analysis of the
Share Classes
Reconciliations of Movements in
Shareholders’ Fundsfor the year ended 31 March 2022
Ordinary Shares |
Called-up share capital |
Share premium account |
Capital redemption reserve |
Distributable reserve |
Capital reserve |
Revaluation reserve |
Total |
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
As at 1 April 2021 |
351 |
— |
203 |
35,995 |
(12,510) |
139 |
24,178 |
Expenses in
relation to prior year share issues |
— |
— |
— |
(7) |
— |
— |
(7) |
Repurchase of shares |
(5) |
— |
5 |
(404) |
— |
— |
(404) |
Realised losses on disposal of investments |
— |
— |
— |
— |
(1,121) |
— |
(1,121) |
Investment holding gains |
— |
— |
— |
— |
— |
14,323 |
14,323 |
Management fees
charged to capital |
— |
— |
— |
— |
(320) |
— |
(320) |
Revenue profit for the year |
— |
— |
— |
462 |
— |
— |
462 |
As at 31 March 2022 |
346 |
— |
208 |
36,046 |
(13,951) |
14,462 |
37,111 |
|
|
|
|
|
|
|
|
FWT Shares |
Called-up share capital |
Share premium account |
Capital redemption reserve |
Distributable reserve |
Capital reserve |
Revaluation reserve |
Total |
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
As at 1 April 2021 |
100 |
7,515 |
— |
2,260 |
(57) |
— |
9,818 |
Share issues
in the year |
71 |
6,682 |
— |
— |
— |
— |
6,753 |
Expenses in
relation to share issues |
— |
(194) |
— |
— |
— |
— |
(194) |
Expenses in
relation to prior year share issues |
— |
(5) |
— |
— |
— |
— |
(5) |
Investment
holding gains |
— |
— |
— |
— |
— |
643 |
643 |
Management
fees charged to capital |
— |
— |
— |
— |
(199) |
— |
(199) |
Revenue loss
for the year |
— |
— |
— |
(194) |
— |
— |
(194) |
As at 31 March 2022 |
171 |
13,998 |
— |
2,066 |
(256) |
643 |
16,622 |
Income Statement
for the year ended 31 March 2022
|
Year ended 31 March 2022 |
Year ended 31 March 2021 |
|
Revenue £’000 |
Capital £’000 |
Total £’000 |
Revenue £’000 |
Capital £’000 |
Total £’000 |
Investment
holding gains/(losses) |
— |
14,966 |
14,966 |
— |
(17,500) |
(17,500) |
Realised losses
on investments |
— |
(1,121) |
(1,121) |
— |
— |
— |
Income |
902 |
— |
902 |
17,667 |
— |
17,667 |
Investment
management fees |
(173) |
(519) |
(692) |
(114) |
(340) |
(454) |
Interest
payable |
— |
— |
— |
(71) |
— |
(71) |
Other expenses |
(461) |
— |
(461) |
(478) |
— |
(478) |
Profit/(loss) before taxation |
268 |
13,326 |
13,594 |
17,004 |
(17,840) |
(836) |
Taxation |
— |
— |
— |
— |
— |
— |
Profit/(loss) after taxation |
268 |
13,326 |
13,594 |
17,004 |
(17,840) |
(836) |
Profit/(loss) per share: |
|
|
|
|
|
|
Ordinary
Share |
1.3p |
37.0p |
38.3p |
48.4p |
(50.2)p |
(1.8)p |
FWT Share |
(1.4)p |
3.2p |
1.8p |
(3.5)p |
(1.5)p |
(5.0)p |
The total column of this statement is the profit and loss
account of the Company and the revenue and capital columnsrepresent
supplementary information.
All revenue and capital items in the above Income Statement are
derived from continuing operations. No operations wereacquired or
discontinued in the year.
The Company has no recognised gains or losses other than those
shown above, therefore no separate statement ofcomprehensive income
has been presented.
Reconciliation of Movements in Shareholders’
Funds
Year ended 31 March 2022 |
Called-up share capital |
Share premium account |
Capital redemption reserve |
Distributable reserve* |
Capital reserve* |
Revaluation reserve |
Total |
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
As at 1 April 2021 |
451 |
7,515 |
203 |
38,255 |
(12,567) |
139 |
33,996 |
Share issues in the year |
71 |
6,682 |
— |
— |
— |
— |
6,753 |
Repurchase of shares |
(5) |
— |
5 |
(404) |
— |
— |
(404) |
Expenses
in relation to share issues |
— |
(194) |
— |
— |
— |
— |
(194) |
Expenses in relation to prior year share
issues |
— |
(5) |
— |
(7) |
— |
— |
(12) |
Realised losses on disposal of investments |
— |
— |
— |
— |
(1,121) |
— |
(1,121) |
Investment holding gains |
— |
— |
— |
— |
— |
14,966 |
14,966 |
Management fees charged to capital |
— |
— |
— |
— |
(519) |
— |
(519) |
Revenue profit for the year |
— |
— |
— |
268 |
— |
— |
268 |
As at 31 March 2022 |
517 |
13,998 |
208 |
38,112 |
(14,207) |
15,105 |
53,733 |
|
|
|
|
|
|
|
|
Year ended 31 March 2021 |
Called-up share capital |
Share premium account |
Capital redemption reserve |
Distributable reserve* |
Capital reserve* |
Revaluation reserve |
Total |
|
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
£'000 |
As at 1 April 2020 |
365 |
8,101 |
200 |
12,845 |
(12,227) |
17,639 |
26,923 |
Share issues in the year |
89 |
9,062 |
— |
— |
— |
— |
9,151 |
Expenses in
relation to share issues |
— |
(277) |
— |
— |
— |
— |
(277) |
Expenses in
relation to prior year share issues |
— |
(8) |
— |
(5) |
— |
— |
(13) |
Repurchase of shares |
(3) |
— |
3 |
(243) |
— |
— |
(243) |
Cancellation of share premium |
— |
(9,363) |
— |
9,363 |
— |
— |
— |
Investment
holding losses |
— |
— |
— |
— |
— |
(17,500) |
(17,500) |
Dividends paid |
— |
— |
— |
(709) |
— |
— |
(709) |
Management fees
charged to capital |
— |
— |
— |
— |
(340) |
— |
(340) |
Revenue profit for the year |
— |
— |
— |
17,004 |
— |
— |
17,004 |
As at 31 March 2021 |
451 |
7,515 |
203 |
38,255 |
(12,567) |
139 |
33,996 |
* Total distributable reserves at 31 March
2022 were £23,905,000 (2021: £25,688,000). Balance
Sheet at 31 March 2022
Registered Number: 07289280
|
As at 31 March 2022 £’000 |
As at 31 March 2021 £’000 |
|
|
|
Fixed assets |
|
|
Investments held at fair value through profit or loss |
46,231 |
25,352 |
|
|
|
Current assets |
|
|
Debtors |
442 |
1,057 |
Cash and cash equivalents |
7,214 |
8,076 |
|
7,656 |
9,133 |
Creditors |
|
|
Amounts falling due within one year |
(154) |
(489) |
Net current assets |
7,502 |
8,644 |
Net assets |
53,733 |
33,996 |
|
|
|
Capital and reserves |
|
|
Called-up share capital |
517 |
451 |
Share premium |
13,998 |
7,515 |
Capital redemption reserve |
208 |
203 |
Distributable reserve |
38,112 |
38,255 |
Capital reserve |
(14,207) |
(12,567) |
Revaluation reserve |
15,105 |
139 |
Equity shareholders’ funds |
53,733 |
33,996 |
|
|
|
|
|
|
Net asset value per share: |
|
|
Ordinary Share |
107.3p |
68.9p |
FWT Share |
97.4p |
98.0p |
Cash Flow
Statement for the year ended 31 March 2022
|
Year ended 31 March 2022
£’000 |
Year ended 31 March 2021 £’000 |
Cash flow
from operating activities |
|
|
Deposit and
similar interest received |
1 |
1 |
Investment
management fees paid |
(676) |
(435) |
Secretarial fees
paid |
(168) |
(172) |
Other cash (payments)/receipts |
(230) |
43 |
Net cash outflow from operating activities |
(1,073) |
(563) |
|
|
|
Cash flow
from investing activities |
|
|
Purchase of
investments |
(6,361) |
(1,441) |
Investments
pending completion |
— |
(796) |
Net proceeds on
sale of investments |
110 |
759 |
Investment income
received |
361 |
406 |
Net cash outflow from investing activities |
(5,890) |
(1,072) |
|
|
|
Cash flow
from financing activities |
|
|
Proceeds of fund
raising |
6,699 |
9,065 |
Expenses of fund
raising |
(194) |
(204) |
Repurchase of own
shares |
(404) |
(243) |
Equity dividends paid |
— |
(709) |
Net cash inflow from financing activities |
6,101 |
7,909 |
Net (outflow)/inflow of cash in the year |
(862) |
6,274 |
|
|
|
Reconciliation of net cash flow to movement in net
funds |
|
|
(Decrease)/Increase in cash for the year |
(862) |
6,274 |
Net cash at start of year |
8,076 |
1,802 |
Net cash at end of year |
7,214 |
8,076 |
Analysis of changes in net debt |
|
|
|
|
At 1 April 2021£’000 |
Cash Flows£’000 |
Other non-cash changes £’000 |
At 31 March 2022£’000 |
|
|
|
|
|
Cash and cash equivalents |
|
|
|
|
Cash |
8,076 |
(862) |
— |
7,214 |
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 31 March
2022. 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 2018 with further COVID-19 guidance issued in March
2020.
2. These are not statutory accounts in
accordance with S436 of the Companies Act 2006. The full audited
accounts for the year ended 31 March 2022, 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 31 March 2022 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:
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 £37,111,000 (2021: £24,178,000) and on 34,593,623
Ordinary Shares (2021: 35,109,032), being the number of Ordinary
Shares in issue at that date.
Net asset value per FWT Share is based on net assets at the year
end of £16,622,000 (2021: £9,818,000) and on 17,058,716 FWT Shares
(2021: 10,021,408), being the number of FWT Shares in issue at that
date.
5. Return per
share
|
Year ended 31 March 2022 |
Year ended 31 March 2021 |
|
OrdinaryShares£'000 |
FWT Shares £’000 |
OrdinaryShares£'000 |
FWT Shares £’000 |
|
|
|
|
|
Total
profit/(loss) after taxation |
13,344 |
250 |
(645) |
(191) |
Total profit/(loss) per share (note a) |
38.3p |
1.8p |
(1.8)p |
(5.0)p |
Revenue
profit/(loss) from ordinary activities after taxation |
462 |
(194) |
17,139 |
(135) |
Revenue profit/(loss) per share (note b) |
1.3p |
(1.4)p |
48.4p |
(3.5)p |
Capital
gain/(loss) from ordinary activities after taxation |
12,882 |
444 |
(17,784) |
(56) |
Capital gain/(loss) per share (note c) |
37.0p |
3.2p |
(50.2)p |
(1.5)p |
Weighted average number of shares in issue during the year |
34,850,621 |
13,566,526 |
35,414,680 |
3,831,368 |
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 gain/(loss) per share is capital gain/(loss) after taxation
divided by the weighted average number of shares in issue during
the year.
6. The Annual General Meeting will be held at
12.30pm on 27 September 2022 at the offices of Foresight Group, The
Shard, 32 London Bridge Street, London, SE1 9SG.
Please refer to the formal notice on page 92 of the Annual Report
and Accounts for further details in relation to this year’s
meeting.
7. Income
|
Year ended31
March2022£’000 |
Year ended31 March2021£’000 |
|
|
|
Dividends received |
484 |
233 |
Loan stock interest |
417 |
442 |
Bank interest |
1 |
1 |
Release of loans payable* |
— |
16,991 |
|
902 |
17,667 |
*Release of loans payable in the prior year relates to the
release of the Company’s loan liability from its wholly owned
subsidiary, Youtan Limited and associated accrued interest. The
release had an equal and opposite effect on the carrying value of
Investments, resulting in a nil impact for the NAV of the
Company.
8. Investments held at
fair value through profit or loss
|
OrdinaryShares
Fund£’000 |
FWTShares
Fund£’000 |
Company £’000 |
Book cost at 1
April 2021 |
23,772 |
1,441 |
25,213 |
Investment holding gains |
139 |
— |
139 |
Valuation at 1
April 2021 |
23,911 |
1,441 |
25,352 |
Movements in the
year: |
|
|
|
Purchases at
cost* |
45 |
7,112 |
7,157 |
Disposal
proceeds |
(123) |
— |
(123) |
Realised
losses |
(1,121) |
— |
(1,121) |
Investment
holding gains |
14,323 |
643 |
14,966 |
Valuation at 31 March 2022 |
37,035 |
9,196 |
46,231 |
Book cost at 31
March 2022 |
22,573 |
8,553 |
31,126 |
Investment holding gains |
14,462 |
643 |
15,105 |
Valuation at 31 March 2022 |
37,035 |
9,196 |
46,231 |
*Purchases at cost for the Ordinary Shares
represents costs incurred in relation to the ongoing disposal of
the Ordinary Shares portfolio.
9. Transactions with
the Investment Manager
Foresight Group LLP was appointed as Investment
Manager in January 2020 and earned fees of £692,000 in the year
ended 31 March 2022 (2021: £454,000). No performance fee was paid
or accrued for the year (2021: nil).
Foresight Group LLP is the Company Secretary
(appointed in November 2017) and received accounting and company
secretarial services fees of £169,000 (2021: £169,000), during the
year.
At the balance sheet date there was £49,000
(2021: £30,000) due from Foresight Group LLP. No amounts have been
written off in the year in respect of debts due to or from the
Investment Manager.
END
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