Foresight Solar Fund Ltd (LSE:FSFL) showed its resilience in the first half of the year and recent months as well as continuing to make progress with efforts to reduce its share price discount to net assets.
Last month, the board extended the share buyback programme by £10 million to a total of up to £50 million, which is proportionately the largest in the renewable investment trust sector. So far, more than £35 million of shares have been repurchased, adding 1.9p per share of NAV upside.
Having sold 50% of its Lorca portfolio in Spain last November, the board initiated the second phase of the divestment programme with the sale process of its Australian portfolio, which is expected to close in the first half of 2025.
This will be, said the trust’s chair Alexander Ohlsson, “a key milestone and, once complete, will re-focus our efforts on the UK and Europe, where we have an exciting pipeline of opportunities fitting with our capital allocation priorities”.
"The anticipated completion of the transaction in 2025 will not only help lower debt but will place the fund in a competitive financial position for when favourable market conditions return – supporting our ability to drive shareholder value.”
At the end of June, net asset value (NAV) stood at £656.8 million or 114.9p per share, compared to £697.9 million and 118.4p at the end of December. This was principally due to lower generation than budgeted due to the poor weather and a fall in power price forecasts.
Revenue was £74.5 million for the half year, only 6.6% behind budget.
Foresight Solar again reiterated that it remained “well on track” to deliver its 8p per share dividend target for 2024, with a 1.4x forecast dividend cover.
Based on current assumptions, the board expects the 2025 dividend to be at least 1.3x covered.