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Foresight Solar Fund Ltd (LSE:FSFL) has demonstrated resilience during the first half of the year, while also making strides to address its share price discount to net assets. Recently, the board expanded the share buyback program by an additional £10 million, bringing the total to £50 million, marking it as the largest program in the renewable investment trust sector. To date, over £35 million of shares have been repurchased, contributing an increase of 1.9p per share to the net asset value (NAV).
Following the sale of 50% of its Lorca portfolio in Spain last November, the board initiated the second phase of its divestment strategy, focusing on the sale of its Australian portfolio, which is projected to close in the first half of 2025. Alexander Ohlsson, the trust’s chair, indicated that this divestment would be a key milestone. Once completed, it will enable the fund to concentrate efforts on the UK and Europe, where a promising pipeline of opportunities aligns with capital allocation priorities. The anticipated completion of the transaction is also expected to reduce debt levels, positioning the fund competitively for favorable market conditions and enhancing shareholder value.
As of the end of June, the net asset value stood at £656.8 million, or 114.9p per share, compared to £697.9 million and 118.4p at the end of December. This decline is primarily attributed to lower generation levels due to unfavorable weather conditions and a decrease in power price forecasts. Revenue for the first half of the year was reported at £74.5 million, reflecting a shortfall of 6.6% against budget expectations.
Foresight Solar reiterated its commitment to achieving an 8p per share dividend for 2024, supported by a forecast dividend cover of 1.4 times. Based on current assessments, the board anticipates that the dividend for 2025 will be at least 1.3 times covered, reflecting confidence in the fund's operational stability and strategic direction.
