Foresight Environmental Infrastructure (FGEN) H2 2025 earnings summary

Executive summary

• Strategic review reaffirmed focus on proactive management of a diversified environmental infrastructure portfolio, emphasizing income generation, progressive dividends, and selective asset disposals for capital recycling.

• Achieved record cash distributions and tenth consecutive year of dividend growth, with a resilient and diversified portfolio focused on environmental infrastructure.

• Portfolio spans renewable energy, energy infrastructure, and sustainable resource management, with 73% in renewables.

• Board introduced a more shareholder-friendly continuation vote structure, lowering the threshold to 50% and simplifying the process.

• Growth assets such as CNG Fuels, The Glasshouse, and Rjukan Aquaculture show strong potential for future capital appreciation.

Financial highlights

• NAV per share at 106.5p, down from 113.6p, offset by a 7.8p dividend, resulting in a flat NAV total return of 0.6% for the year and a 7.3% annualized NAV total return since IPO.

• Record cash generation from assets, with dividend cover at 1.32x, the second highest since IPO.

• FY25 dividend of 7.80p delivered, with cover at 1.32x; FY26 dividend target increased to 7.96p (10% yield at publication).

• Two major asset sales (AD portfolio and solar rooftop) raised £90m, enabling debt reduction and a £30m share buyback program.

• Portfolio value at £765.7m, down from £891.9m due to asset sales and capital returns.

Outlook and guidance

• Dividend target for next year increased by 2.1% to 7.96p per share, targeting a ~10% yield on current share price.

• Focus remains on income generation, value enhancement in the existing portfolio, and disciplined new investments.

• Dividend cover expected to remain healthy, though likely to decrease slightly to around 1.2x for the next financial year.

• Refocused investment strategy to balance income and growth, leveraging market opportunities in renewables and sustainable resources.

• New investments will be highly selective, prioritizing contracted revenues and inflation linkage.