Foresight Environmental Infrastructure (LSE:FGEN) said it would continue to prioritise stable, long-term cash flows after a strategic review led the investment trust to tighten its focus on core environmental assets.
The London-listed company, which backs projects in renewable energy, energy infrastructure and sustainable resource management, said it had weathered a tough macroeconomic backdrop to deliver its tenth consecutive year of record cash receipts from investments.
Dividend cover rose to 1.32 times, the second highest since its 2013 flotation.
The company reported net assets of £678.7 million at the end of March, down from £751.2 million a year earlier. Net asset value (NAV) per share slipped to 106.5 pence, reflecting a 0.6% NAV total return for the year.
Distributions and fees from its portfolio rose to £90.4 million, and it delivered a dividend of 7.80 pence for the year.
FGEN said it is now targeting a payout of 7.96 pence for the next financial year, offering a 10% yield based on the share price at 23 June.
Earlier this year, Foresight sold 10% of its portfolio for £88.6 million and has returned £24.3 million to shareholders under a £30 million share buyback programme. Gearing stood at 28.7%, one of the lowest among its listed peers.
Following advice from external consultants, the FGEN concluded that future investment would concentrate on core assets with inflation-linked revenues and long-term cash flows.
Growth-oriented assets are expected to be sold off in the medium term to maximise returns.
Chair Ed Warner said the portfolio had proven resilient and the company was "uniquely placed" to benefit from the energy transition, which he called one of the biggest investment opportunities of the generation.