REG - Foresight Group Hldg - Foresight Group Holdings Limited Half-year results
09/12/2021 07:00
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RNS Number : 0474V Foresight Group Holdings Limited 09 December 2021
LEI: 213800NNT42FFIZB1T09
9 December 2021
Foresight Group Holdings Limited
Half-year results for the six months ended 30 September 2021
Foresight Group Holdings Limited ("Foresight", "the Company", "the Group"), a
leading infrastructure and private equity manager, is pleased to announce its
results for the six months ended 30 September 2021 ("H1 FY22").
'A strong financial and operational performance, significant organic growth
and a very favourable outlook'
Highlights
● Significant organic growth in Assets under Management ("AUM") to £8.1 billion
and Funds under Management ("FUM") to £6.1 billion at 30 September 2021, up
13% and 18% respectively, in the six-months from 31 March 2021
- Successful final close of Foresight Energy Infrastructure Partners ("FEIP"),
with total commitments of €851 million secured, 70% ahead of original target
- Net inflows of £0.7 billion delivered across both retail and institutional
funds, highlighting the benefits of Foresight's broad range of strategies
- Retail net inflows of £0.3 billion during the six-month period, back to
similar levels seen in the six-month period pre-pandemic
● Group Revenue of £39.7 million, up 22% on the prior year period; high quality
recurring revenue comprised 89.5% of total revenue, comfortably within target
range
● Core EBITDA pre-share-based payments1 ("SBP") up 43% to £15.2 million (£10.6
million in the prior year period ("H1 FY21")); Core EBITDA pre-SBP margin
improved to 38.3% (32.8% in H1 FY21), on track to deliver medium-term margin
target of c.43%
● Interim dividend of 4 pence per share reflecting increased payout ratio of 60%
announced in July 2021
● Strong capital deployment across Infrastructure and Private Equity with £295
million deployed in the six-month period across 51 assets, up from £206
million in H1 FY21
Post-period end and outlook
● Post-period end the Group listed its first dedicated forestry fund, raising
£130 million and underlining Foresight's ongoing commitment to climate
solutions and strength in product development
● Excellently positioned to capture benefits of the strong sector tailwinds
further highlighted by COP26
● Significant pipeline of new fund launches and deployment opportunities in H2
FY22 and beyond
● Foresight remains on track to deliver against its ambitious strategic and
financial targets
Management update
● To reflect both the rapid growth of the Infrastructure Division in recent
years and its significant future growth plans the Group has appointed Ricardo
Piñeiro as Co-Head of Infrastructure alongside Nigel Aitchison, effective 1
January 2022. Ricardo will join the Group's Executive Committee and will
take responsibility for day-to-day management of the Division.
Bernard Fairman, Executive Chairman of Foresight Group Holdings Limited,
commented:
"I am delighted with the Group's continued strong performance over the last
six months, delivering a significant increase in AUM on an organic basis,
driven by strong retail net inflows and further institutional closings. This
performance, combined with a very favourable sector outlook, the recent
successful listing of our first dedicated forestry fund and a strong near-term
pipeline of new launches and deployment, underpins the Board's considerable
confidence in achieving the Group's targets for the full year to 31 March
2022.
"With our unique combination of skills and expertise across sustainable
infrastructure and regional private equity investment in the UK, Foresight is
optimally positioned to continue to grow by sourcing high quality
opportunities in these attractive and expanding markets."
1. In line with previous periods we continue to quote Core EBITDA
pre-SBP and have updated nomenclature to make this clear.
Analyst presentation
The pre-recorded presentation will be available to view on the Company's
website (https://www.fsg-investors.com (https://www.fsg-investors.com/) ) from
7.00 a.m. (UK time) on 9 December 2021.
It will be repeated at the start of the webcast at 9.00a.m. (UK time) on 9
December 2021, and be followed by live Q&A for analysts hosted by Bernard
Fairman (Executive Chairman) and Gary Fraser (CFO and COO).
Those wishing to join should register via the following link:
Register here
(https://www.lsegissuerservices.com/spark/FORESIGHTGROUPHOLDINGSLIMITED/events/7b3ce7a8-3f7f-4a0b-87c9-247ee88e1861)
For further information please contact:
Foresight Group Investors Citigate Dewe Rogerson
Liz Scorer Caroline Merrell / Toby Moore
+44 (0) 7966 966956 +44 (0) 7852 210329 / +44 (0) 7768 981763
ir@foresightgroup.eu (mailto:ir@foresightgroup.eu)
caroline.merrell@citigatedewerogerson.com
(mailto:caroline.merrell@citigatedewerogerson.com) /
toby.moore@citigatedewerogerson.com
(mailto:toby.moore@citigatedewerogerson.com)
About Foresight Group Holdings Limited
Foresight Group was founded in 1984 and is a leading infrastructure and
private equity investment manager, operating from 12 offices across six
countries in Europe and Australia with AUM of c. £8.1 billion as at 30
September 2021. With a long-established focus on ESG and sustainability-led
strategies, it aims to provide attractive returns to its institutional and
private investors from hard-to-access private markets. Foresight Group manages
over 300 infrastructure assets with a focus on solar and onshore wind assets,
bioenergy and waste, as well as renewable energy enabling projects, energy
efficiency management solutions, social and core infrastructure projects and
sustainable forestry assets. Its private equity team manages eight regionally
focused investment funds across the UK, supporting over 120 SMEs. Foresight
Group listed on the Main Market of the London Stock Exchange in February 2021.
https://www.fsg-investors.com/ (https://www.fsg-investors.com/)
Disclaimer - Forward-looking statements
This statement, prepared by Foresight Group Holdings Limited (the "Company"),
may contain forward-looking statements about the Company and its subsidiaries
(the "Group"). Such forward-looking statements can be identified by the use of
forward-looking terminology, including the terms "believes", "projects",
"estimates", "plans", "anticipates", "targets", "aims", "continues",
"expects", "intends", "hopes", "may", "will", "would", "could" or "should" or,
in each case, their negative or other various or comparable terminology.
Forward-looking statements involve known and unknown risks, uncertainties,
assumptions and other factors which are beyond the Company's control and are
based on the Company's beliefs and expectations about future events as of the
date the statements are made. If the assumptions on which the Group bases its
forward-looking statements change, actual results may differ from those
expressed in such statements. There are a number of factors that could cause
actual results and developments to differ materially from those expressed or
implied by these forward-looking statements, including those set out under
"Principal Risks" in the Company's annual report for the financial year ended
31 March 2021. The annual report can be found on the Company's website
(www.fsg-investors.com (http://www.fsg-investors.com) ). Forward-looking
statements speak only as of the date they are made. Except as required by
applicable law and regulation, the Company undertakes no obligation to update
these forward-looking statements. Nothing in this statement should be
construed as a profit forecast.
EXECUTIVE CHAIRMAN'S STATEMENT
Introduction
During the six-month period to 30 September 2021, we continued to build on
the positive momentum generated by Foresight's listing earlier this year. FUM
grew substantially with strong retail net inflows and institutional fund
closes which, combined with the forecast near-term pipeline of new fund
launches and deployment, gives the Board confidence in achieving the Group's
targets for the full year to 31 March 2022.
Operational and financial highlights
The first six months of FY22 saw strong growth in AUM to £8.1 billion and
FUM to £6.1 billion, from £7.2 billion and £5.1 billion respectively at
year end.
In terms of fundraising and new fund launches, following the easing of
COVID-19 pandemic restrictions, it is good to see retail net inflows returning
to pre-pandemic levels. On 6 September 2021, we delivered the final close of
Foresight Energy Infrastructure Partners ("FEIP"), 70% ahead of our original
target and with total commitments of €851 million, which was an excellent
achievement. On the Private Equity side, Foresight Regional Investment
Fund III ("FRIF III") delivered its first close of £66 million in May 2021.
There are a number of additional launches and capital fundraisings planned for
other Foresight funds in the second half of FY22, underlining our ability to
raise funds across a diversified investor base in a range of differentiated
products.
After the period end, Foresight's new sustainable forestry fund issued its
Prospectus and successfully listed on 24 November with £130 million raised.
This is the Group's first dedicated forestry investment vehicle, and very much
a fund of its time. It is particularly timely as investment mandates evolve
to reflect a greater emphasis on ESG and is evidence of our ongoing commitment
to sustainability.
We also saw strong capital deployment across Infrastructure and Private Equity
with £295 million deployed during the period compared with £206 million for
the corresponding period of the prior financial year.
Revenues in the period were in line with Group expectations, up 22% to £39.7
million (30 September 2020: £32.4 million) with most of the growth in the top
line coming from an increase in management fees as a result of our increased
FUM. We continue to experience minimal fee margin compression.
Recurring revenues for the six‑month period represented 89.5% of total
revenues. Our continued expectation for recurring annual revenue is a range
of 85%‑90%, which incorporates an element of performance fee recognition
principally from the regionally based private equity funds as they reach the
realisation phase of their investment cycle.
Core EBITDA pre-share based payments was in line with expectations at £15.2
million for the six-month period (30 September 2020: £10.6 million) with the
associated margin also increasing to 38.3% from 32.8% as we continue to
benefit from increased operational gearing and progress towards our
medium‑term target.
More detail on our financial highlights can be found in the Financial Review
section of this Half-year Report.
Dividend
Following the success of FY21, we increased the proposed dividend payout to
60% and it is our intention to maintain this going forward, paying
approximately one-third of the total dividend for the year as an interim
dividend and approximately two-thirds as a final dividend.
The Board has therefore recommended an interim dividend of 4.0 pence per share
(equating to £4.3 million) be paid on 25 March 2022 with an ex‑dividend
date of 10 March 2022 and a record date of 11 March 2022.
Sustainability
The agreements reached at COP26 over cutting methane emissions by 30% by 2030,
the ending of financing unabated fossil fuels projects and the pledge to end
deforestation are expected to lead to many more investment opportunities for
Foresight, adding momentum across all our business areas.
We continue to focus on our ESG strategies, developing our policies and
activities across our existing portfolio and new investments. As part of our
strategy, in November we became a member of the Sustainable Market
Initiative's Natural Capital Investment Alliance ("NCIA"), established in
January 2021 by His Royal Highness The Prince of Wales.
NCIA members plan to launch, or have launched, investment products aligned to
Natural Capital themes that are expected to mobilise more than $10 billion in
aggregate.
The themes range from direct investment in forestry, through to investments
in businesses that are helping to move us from a "take, make, waste" economy
to one that emphasises sustainability as a key component of alleviating
pressure on forestry, biodiversity and natural systems.
As a sustainability-led investment manager, we have continued to review our
own carbon footprint and are developing our net zero goals, on which we will
provide more detail in the near future. We will also provide an update on our
reporting requirements relating to TCFD in the Annual Results for FY22.
Power price volatility
Foresight currently manages c.£4.0 billion of electricity generating assets.
As noted in our October trading update, the recent significant increases in
power pricing in the UK and beyond have provided positive momentum for
Foresight's balanced portfolio of infrastructure assets. The Governor of the
Bank of England recently spoke of permanently higher energy prices because of
the shift to green policies.
More broadly, this highlights the need for further acceleration in the
transition to reliable, resilient and low carbon energy systems, an area in
which Foresight has established itself as a leader.
Management update
To reflect both the rapid growth of the Infrastructure Division in recent
years and its significant future growth plans, I am delighted to announce the
appointment of Ricardo Piñeiro as Co-Head of Infrastructure alongside Nigel
Aitchison, effective 1 January 2022. Ricardo is the Foresight partner
responsible for Foresight Solar Fund and the company's infrastructure asset
management activities and will join the Group's Executive Committee, taking
responsibility for day-to-day management of the Division. Nigel has made the
decision to reduce his time commitment to three days per week and will utilise
his significant experience in sustainable investment to focus on driving the
longer-term ambitions of the business and managing a number of strategic
initiatives.
Outlook
It has been refreshing to see our offices return to life during the Autumn
with the easing of restrictions across the UK, and with it the reinvigoration
of Foresight's creative spark that has always underpinned our innovative and
entrepreneurial spirit. However, with the identification of the Omicron
variant we have been reminded that the COVID-19 pandemic is not over yet and
we will continue to prioritise the health and safety of our staff, our clients
and our suppliers as we navigate the evolving impacts of this global pandemic.
The Group achieved strong results in the first half of FY22, having achieved
our stated AUM growth target from wholly organic sources. We continue to
anticipate high growth in the underlying markets we serve and are confident
in our ability to identify attractive investment opportunities which will
allow us to strengthen our position as a leading presence in those markets. We
believe we are excellently positioned to capture the benefits of the positive
tailwinds driving sustainable infrastructure investment and are on track to
achieve our targets for the full year and beyond.
Bernard Fairman
Executive Chairman
8 December 2021
FINANCIAL REVIEW
for the six months ended 30 September 2021
Continuing the progress made since IPO, the first six months of FY22 have
delivered another strong performance, with AUM, revenue and Core EBITDA pre
share-based payments ("SBP") all growing year-on-year.
KPIs
30 September 30 September 31 March
2021 2020 2021
Period-end AUM (£m) 8,133 6,766 7,193
Period-end FUM (£m) 6,067 4,761 5,132
Average AUM (£m) 7,728 6,098 6,547
Average FUM (£m) 5,650 4,402 4,691
Total revenue (£000) 39,707 32,417 69,098
Recurring revenue (£000) 35,546 29,508 62,379
Recurring revenue/total revenue (%) 89.5% 91.0% 90.3%
Core EBITDA pre share-based payments (£000) 15,202 10,625 23,910
Core EBITDA pre share-based payments margin (%) 38.3% 32.8% 34.6%
In line with previous periods, and for comparability, we continue to quote
Core EBITDA pre-SBP and have changed nomenclature in order to make this clear.
Core EBITDA pre-SBP was introduced as our key performance measure because the
Group believes this measure is the main profitability comparator used within
the asset management market and reflects the trading performance of the
underlying business without distortion from the uncontrollable nature of the
share based payments charge. While the Group appreciates that APMs are not
considered to be a substitute for or superior to IFRS measures, we believe the
selected use of these provides stakeholders with additional information which
will assist in the understanding of the business.
Assets Under Management/Funds Under Management ("AUM/FUM")
AUM and FUM both grew by £0.9 billion in the six-month period. Retail net
inflows totalled £0.3 billion, which included £0.2 billion from our OEIC
products. Institutional net inflows totalled £0.4 billion, primarily through
further closes from our Foresight Energy Infrastructure Partners ("FEIP") fund
and the first close of our new Private Equity regional fund ("FRIF III").
Summary Statement of Comprehensive Income and Core EBITDA reconciliation
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Revenue 39,707 32,417 69,098
Cost of sales (2,447) (2,331) (4,639)
Gross profit 37,260 30,086 64,459
Administrative expenses (24,130) (21,490) (48,709)
Other operating income 250 46 394
Operating profit 13,380 8,642 16,144
Finance income and expense (360) (348) (707)
Fair value gains on investments 83 51 192
Share of post-tax profits of equity accounted joint venture 8 (19) 26
Profit on ordinary activities before taxation 13,111 8,326 15,655
Tax on profit on ordinary activities (1,644) (8) (481)
Profit 11,467 8,318 15,174
Other comprehensive income
Translation differences on foreign subsidiaries 67 (272) (293)
Total comprehensive income 11,534 8,046 14,881
Adjustments:
Non-operational staff costs 300 670 3,186
Non-operational legal costs - 475 2,744
Profit on disposal of tangible fixed assets and gain on bargain purchase - (174) (344)
Other operating income (250) (46) (394)
Finance income and expense 360 348 707
Tax on profit on ordinary activities 1,644 8 481
Depreciation and amortisation 1,404 1,298 2,649
Core EBITDA 14,992 10,625 23,910
Share-based payments 210 - -
Core EBITDA pre share-based payments(1) 15,202 10,625 23,910
1. The Group uses Core EBITDA pre‑SBP to assess the financial
performance of the business. This measure is a non‑IFRS measure because it
excludes amounts that are included in the most directly comparable measure
calculated and presented in accordance with IFRS. The specific items excluded
are non-underlying items, which are defined as non-trading or one-off items
where the quantum, nature or volatility of such items are considered by the
Directors to otherwise distort the underlying performance of the Group.
Revenue
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Management fees 33,655 22,582 50,245
Secretarial fees 695 5,883 9,828
Directors' fees 1,196 1,043 2,306
Recurring fees 35,546 29,508 62,379
Marketing fees 2,114 1,290 2,841
Arrangement fees 1,435 1,610 3,858
Other fees 612 9 20
Total 39,707 32,417 69,098
Total revenue in the six-month period increased by 22% year-on-year to £39.7
million (30 September 2020: £32.4 million) with recurring revenue increasing
by 20% to £35.5 million (30 September 2020: £29.5 million), maintaining the
c.90% level of recurring fees we reported in last year's results. As we begin
to make further realisations from our Private Equity portfolios, we anticipate
that performance fees will contribute a larger part of the revenue mix.
This is in line with our expectations and does not alter our previously stated
target range of generating 85-90% of revenue from recurring fees.
As a result of FUM growth, the largest revenue increase year-on-year came from
management fees with FEIP contributing c.£2.4 million of the uplift following
further interim and final closes during the period. The continued growth in
Foresight Capital Management also contributed to an increase of c.£2.3
million. The annualised impact from the PiP acquisition in August 2020
contributed a further c.£1.0 million in management fees.
As explained in our Annual Report, we restructured the fee on our ITS product
in January 2021, removing the secretarial fee, and at the same time also
removing the dependence of the management fee on a performance hurdle.
Marketing fees are the initial fees recognised as a percentage of funds raised
on our tax-based retail products. This revenue line increased during the
six-month period as a result of the UK coming out of lockdown, with
fundraising returning to pre-pandemic levels. This gives the Board further
confidence in the outlook for the rest of this financial year and beyond.
Cost of sales
Cost of sales comprises insurance costs associated with our Accelerated ITS
("AITS") product and authorised corporate director costs payable to a third
party in relation to our OEIC products. This charge is broadly in line with
the prior six-month period.
Administrative expenses
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Staff costs 16,609 15,519 33,751
Depreciation and amortisation 1,404 1,298 2,649
Legal & professional 1,594 2,116 5,984
Other administration costs 4,523 2,557 6,325
24,130 21,490 48,709
Year-on-year, the overall cost base has increased by c.12%. Staff costs have
increased by c.£1.1 million, due to the annual pay review process; the
implementation of the staff SIP and PSP schemes post-IPO; and an increase in
FTE of 15.6 in the twelve months. This increase in FTE has predominantly
occurred in the high growth areas across the business: FCM as our net inflows
continue to increase and we launch new funds; Infrastructure in line with our
increase in AUM and number of assets in the portfolio; and finally, in Retail
Sales, where we have expanded the team to drive further inflows, which is
already reaping rewards through strong inflows on our ITS product in the first
six months of FY22.
The increase in Other administration costs principally relates to an increased
irrecoverable VAT charge. As with most financial services businesses, we are
not able to recover all the VAT on our purchases because some of our revenue
streams are VAT exempt. The management fees from our FCM OEIC businesses are
VAT exempt and their recent strong growth has driven a related increase in the
irrecoverable VAT charge. In addition to this, there have been some increased
costs year-on-year following our listing in February, which include the costs
associated with the Annual and Half-year Reports and re-design of the Group's
website.
Core EBITDA pre share-based payments
The Group uses Core EBITDA pre share-based payments as one of its key metrics
to measure performance as it views this as the profitability number that is
most comparable to the Group's recurring revenue model (i.e. a cash profit
number after taking out any one‑offs, both positive and negative).
Core EBITDA pre share-based payments increased 43% year-on-year to £15.2
million for the period ended 30 September 2021 (30 September 2020: £10.6
million) with the margin percentage improving to 38.3% (30 September 2020:
32.8%) as we continue to progress towards our medium-term target of 43%.
The Group has concluded that the following are non-underlying items for the
purposes of calculating Core EBITDA pre share-based payments:
Non-operational staff costs
The non-operational staff costs in the period ended 30 September 2021 relate
to retention payments made to key members of staff.
The equivalent cost in the prior year related to pre-IPO profit share for
FY20. These distributions made to members were classified as remuneration
expenses under IFRS but considered to be equity transactions for the purposes
of calculating Core EBITDA.
Non-operational legal costs
There have been no costs of this nature in the six-month period ended 30
September 2021. The period ended 30 September 2020 included c.£0.2 million
of redundancy costs and c.£0.3 million of IPO costs.
Other operating income
In the six-month period ended 30 September 2021, all other operating income
arose from the development of a reserve power plant in Shirebrook, Derbyshire
on behalf of the Foresight ITS product.
The £46k in the prior period related to grant income from the Coronavirus Job
Retention Scheme.
Interest and tax
The only major variance in these line items year-on-year relates to tax. As
noted in the Annual Report, historically, the taxation on profits earned by
the Group was generally the personal liability of the members of Foresight
Group LLP, where the majority of the Group's profits are generated. Following
the IPO, more of the Group's profits are subject to corporation tax, as
demonstrated by the charge recognised in the period.
Share-based payments
The share-based payments charge relates to the SIP and PSP schemes implemented
in the period.
Summary Statement of Financial Position
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Assets
Property, plant and equipment 2,838 3,600 3,012
Right-of-use assets 8,791 9,490 9,120
Intangible assets 3,014 3,099 3,012
Investments 2,455 1,792 2,326
Deferred tax asset 860 169 977
Contract costs 4,848 739 837
Trade and other receivables 20,780 18,322 19,881
Cash and cash equivalents 42,760 11,971 39,431
Net assets of disposal group classified as held for sale 64 64 64
Total assets 86,410 49,246 78,660
Liabilities
Trade and other payables (21,401) (12,907) (20,939)
Loans and borrowings (3,649) (4,279) (4,324)
Lease liabilities (11,547) (12,524) (12,019)
Deferred tax liability (516) (544) (1,581)
Total liabilities (37,113) (30,254) (38,863)
Net assets 49,297 18,992 39,797
Net assets have increased by £9.5 million in the six-month period. The key
variances since year end are explained below:
Contract costs
The increase of £4.0 million since year end is due to the incremental
placement agency fees on the further closes of FEIP in the period (as
explained in note 3 to these accounts).
Cash and cash equivalents
The cash balance has continued to grow since year end due to positive cash
generation from a strong trading performance and the collection of some aged
receivables.
Dividends
As noted in our Annual Report, the Board decided to increase and maintain the
dividend payout ratio at 60% going forward and has recommended an interim
dividend payment of 4.0 pence per share. The dividend will be paid on
25 March 2022 with an ex‑dividend date of 10 March 2022 and a record date
of 11 March 2022.
Gary Fraser
Chief Financial Officer
8 December 2021
BUSINESS REVIEW
INFRASTRUCTURE
17
FORESTRY INVESTMENTS MADE DURING THE PERIOD
4,440
TOTAL HECTARES
Overview
Foresight's Infrastructure team originates investment opportunities and
manages assets in the renewable energy and energy transition markets as well
as the social and core infrastructure sectors. Its investment strategies
primarily focus on investment in solar and onshore wind assets, bioenergy and
waste, as well as renewable energy enabling projects (such as flexible
generation and battery storage), geothermal heat, energy efficiency management
solutions, social infrastructure projects and sustainable forestry assets.
The team has a strong origination and execution capability, an active approach
to asset management and an established track record of managing retail and
institutional capital. The staff have extensive experience of deploying
capital into a variety of renewable energy and infrastructure projects
throughout their development, construction and operational phases.
As at 30 September 2021, Foresight Infrastructure had a total AUM of £6.0
billion. The team consists of 85 investment, portfolio and technical
professionals who facilitate the acquisition and management of 338
infrastructure assets across 16 asset classes with a total renewable energy
generating capacity of 3.1GW.
As at 30 September 2021, Foresight Infrastructure managed £1.6 billion of
solar assets in the UK, Portugal, Spain, Italy and Australia, with 1.7GW of
installed capacity as well as wind assets with 885MW of generation capacity
across the UK, Sweden, Germany, France and Spain.
Foresight Infrastructure provides a complete end‑to‑end solution for
investors. From investment origination and execution, including sourcing and
structuring all elements of the capital structure required, to the ongoing and
active technical asset management of operating assets, including performance
and financial optimisation of an asset immediately upon its acquisition.
The asset management process is driven by an in-house team which is focused
on the relevant O&M contractor's performance, operational performance,
cost management and asset life enhancement with the objective of generating
sustainable long-term asset operation and economic benefits.
Capital deployment and fundraising
Foresight's Infrastructure team completed 25 transactions in the first half of
the year, committing £254 million of capital. Investments were made across a
wide range of our funds and across multiple sectors and geographies.
Deployment in H1 FY22 has predominantly been focused on Foresight's forestry
strategy with the acquisition of 4,400 hectares of land across 17 assets in
the period.
On 14 September 2021, Foresight Energy Infrastructure Partners completed its
final close. The Fund secured total commitments of €851.4 million, 70% over
the €500 million original target. Including co‑investments to date of
€170 million, this represents a total capital pool in excess of €1 billion
for Foresight's energy transition strategy. Commitments were made by over 35
leading global institutional investors from Europe and North America.
Fundraising was strong in the first six months of FY22, with additional
fundraises across a number of our existing funds. We received additional
commitments of £1.1 billion during the period. There were no notable account
losses or outflows during the period.
Investment into new technologies
Post period end, Foresight expanded the type of assets it invests in with the
acquisition of a 51% shareholding in a Dutch geothermal heat pipeline. The
investment, acquired by Foresight Energy Infrastructure Partners, involved
both the acquisition of operational wells (c.15MW) and the construction of new
wells (c.23MW). There is also a significant pipeline of development projects
representing a potential build out capacity of c.200MW.
The technology utilises heat extracted from high temperature water which is
located in the sub‑surface of the earth and output heat is distributed via a
heat network to surrounding houses and industry.
Geothermal is strongly supported by the Dutch government as a strategic
priority because of the substantial role it can play in the decarbonisation of
domestic and industrial heat. Studies of geothermal heat provision have
demonstrated that geothermal heat can achieve carbon savings in excess of 90%
by displacing the need for fossil fuel usage.
Sustainability at the heart of the investment process
To ensure that all potential Infrastructure investments have been adequately
assessed to meet our high standard of sustainability and ESG-related
performance, they are evaluated in line with Foresight's Sustainable
Evaluation Tool ("SET"). The SET is designed to provide an objective view of
sustainability performance through use of recognised quantitative KPIs and
forms part of the Investment Committee papers. During the investment process,
the analysis is read and approved by all those involved and once an asset has
been acquired, Foresight's Asset Management team monitors performance and
continually investigates ways for the asset to improve sustainability
performance.
Asset-level KPIs are used to score an investment against a set of 15-18 key
assessment parameters across five key areas:
● Sustainable Development Contribution
● Environmental Footprint
● Social Welfare
● Governance
● Third Party Interactions
All KPIs are weighted based on internal prioritisation and materiality
assessments and are scored in line with response bands corresponding to the
five-point scale as below:
● 5 = High performance
● 4 = Above average
● 3 = Average performance
● 2 = Below average
● 1 = Low performance
Whilst a specific minimum standard for the scoring against each assessment
parameter is not set, in the context of the five-point scoring scale, we aim
for all our assets to score at least an average of 3/5 and be consistent with
the sustainability and ESG standards set across the Foresight portfolio.
This quantitative KPI-based approach to assessing a project's sustainability
credentials helps to standardise the quality of sustainability assessment
applied across the portfolio and also helps guide and focus investment teams'
resources to the areas that require the most attention.
Market outlook
In the period to 30 September 2021, there were several government
announcements which aid Foresight Infrastructure's objective to decarbonise
the power grid.
In April 2021, the UK government announced a new and more ambitious climate
change target - to reduce emissions by 78% by 2035 compared to 1990 levels(1).
In line with the recommendation from the independent Climate Change
Committee, the sixth Carbon Budget limits the volume of greenhouse gases
emitted over a five‑year period from 2033 to 2037.
This action will take the UK more than three-quarters of the way to reaching
net zero by 2050. The Carbon Budget is intended to ensure the UK remains on
track to reduce its contribution to climate change and remain consistent with
the Paris Agreement temperature goal to limit global warming to well below
2°C and pursue efforts towards 1.5°C. In the Balanced Net Zero Pathway set
out in the Carbon Budget, in-year capital investment increases significantly
during the 2020s and early 2030s, from around £10 billion in 2020 to around
£50 billion by 2030(2).
In July 2021, the European Commission unveiled its plan to meet its 55%
emission reduction target by 2030. This plan is the first step towards carbon
neutrality set for 2050 and aims to make Europe the first climate neutral
continent in the world. The Commission proposes to increase the binding target
for renewable energy in the EU's energy mix to 40%.
This aims to promote the uptake of renewable energy and has increased energy
efficiency targets at the EU level, making these binding, to achieve an
overall reduction of 36%-39% by 2030 for final and primary energy
consumption(3). In order to fund this, it is estimated that annual investment
in the European energy system will need to increase by around €350 billion
in the coming decade (2021-2030) compared to the previous decade (2011-2020).
This is mainly due to new capacity and interconnectors, including building
renovations and the replacement of old power and industrial plants as they
come to the end of their economic lives.
It is believed that this level of investment can provide a much‑needed
stimulus to promote a long-lasting recovery from the Covid-19 crisis for the
benefit of the European economy and people.
The European Council believes that directing funds to appropriate investments
is more important than ever in the current context, and economies cannot
afford to invest in assets that may become obsolete in the near future(4).
The outlook for Foresight Infrastructure is favourable with moves towards
increased incentivisation of private capital to deliver public infrastructure
projects. This is a consistent theme across many global economic development
plans. The decarbonisation agenda is a major tailwind to the strategy with
governments and corporates demanding more renewable energy and energy
transition projects.
COP26
In November 2021, government officials from around the world met at COP26 in
Glasgow to discuss plans on how to tackle the climate crisis. The first major
announcement was the agreement by more than 100 world leaders to end and
reverse deforestation by 2030. The countries which signed the pledge cover 85%
of the world's forests and included Canada, Brazil, Russia, China, the United
States and the United Kingdom(5). The recently listed Foresight Sustainable
Forestry Company ("FSFC") is well placed to benefit from government support to
achieve this target. With its diversified portfolio of UK forestry and
afforestation assets, FSFC is targeting to plant 40% of the UK's annual target
of 30k hectares in the first year.
1. Source:
https://www.gov.uk/government/news/uk-enshrines-new-target-in-law-to-slash-emissions-by-78-by-2035
2. Source:
https://www.theccc.org.uk/wp-content/uploads/2020/12/The-Sixth-Carbon-Budget-The-UKs-path-to-Net-Zero.pdf
3. Source:
https://ec.europa.eu/info/strategy/priorities-2019-2024/european-green-deal/delivering-european-green-deal_en
4. Source:
https://ec.europa.eu/commission/presscorner/detail/en/qanda_20_1598
5. Source:
https://ukcop26.org/glasgow-leaders-declaration-on-forests-and-land-use/
PRIVATE EQUITY
7
UK OFFICES
c.2,000
BUSINESS PLANS REVIEWED EVERY YEAR
129
PORTFOLIO COMPANIES
£810m
AUM
11
DIFFERENT INVESTMENT VEHICLES
32
INVESTMENT PROFESSIONALS
Overview
Foresight Private Equity offers a variety of fund structures to facilitate
investment from both institutional and retail investors, such as regional
institutional funds, Venture Capital Trusts, Enterprise Investment Schemes
("EIS") and Inheritance Tax Solutions ("ITS"). Foresight provides venture,
growth capital and replacement capital investments through Foresight's network
of seven regional UK offices.
The team makes investments of up to £5 million, targeting investment in
sectors with favourable long‑term trends and structural growth drivers.
As over 80% of all UK SMEs are based outside London, we believe our
UK regional focus is a key strength and differentiator. These investments
also cover a range of maturity profiles from early stage to more mature small
companies. Annual revenues at portfolio companies predominantly range between
£2 million and £20 million for equity release and buyout transactions,
although venture and seed investments can be into high tech, pre-revenue
companies, which are often university spin‑outs.
ESG considerations are core to Foresight's investment management approach.
Foresight's Private Equity team makes sustainable growth investments into SMEs
that have the potential to create broad, long-term ESG benefits through their
operations and continuous improvement. We understand that many SMEs struggle
to adopt ESG best practices and we work in partnership with our portfolio
companies to put ESG principles at the heart of their businesses. This not
only helps to improve performance, but also differentiates them from their
competitors and drives real value at time of exit.
Performance
In the six months to 30 September 2021, the Private Equity team had another
period of strong activity, benefiting from the full reopening of the UK
economy. £41.5 million of capital was deployed across 26 transactions to
support 22 UK SMEs. The funding came from nine different investment vehicles,
covering a wide variety of sectors and investment types. A further
£40 million was committed to portfolio companies which provide lending to
third parties. The Foresight Williams Technology funds and Foresight VCTs
were particularly active, completing eight and seven transactions
respectively, including follow-on investments.
Foresight has seen a revival in the pipeline of potential investments and has
a considerable number of opportunities under exclusivity or in due diligence
across all of its active Private Equity funds.
The impact of Covid-19 will increase investment opportunities over time. SMEs
that have demonstrated their resilience during the last 18 months are now
assessing their growth funding requirements. Those that have required
government support, which has been primarily in the form of debt, will be
looking to raise equity to strengthen their balance sheets ahead of expansion.
In the six months to 30 September 2021, the Private Equity team also completed
several successful realisations from both retail and institutional funds.
Notable examples include Mologic, a health diagnostics company providing both
contract research services for clients and developing its own range of
proprietary point-of-care diagnostics products. The company was sold to Global
Access Health, a not‑for‑profit company financed by the Soros Economic
Development Fund, returning 3.1x to Foresight funds in three years.
Poppy & Jacks, a nursery chain, was Foresight's fourth successful exit
this year as it was sold to Kids Planet Day Nurseries, a national nursery
chain, returning 2.5x the initial investment.
During the period, the portfolio has shown good recovery as businesses adapt
to the new economic climate combined with the easing of restrictions in the
Autumn.
The Private Equity team is ensuring that finance directors at the portfolio
companies continue to tightly manage overheads and critically assess capital
expenditure given the uncertain macro environment, which includes undertaking
scenario analysis that covers the potential for another lockdown in winter
2021/22. Foresight will continue to provide support to its portfolio companies
using the same toolbox of support as during the first lockdowns in 2020.
The portfolio has faced new challenges stemming from the Brexit transition and
COVID-19 headwinds, including supply chain issues and staff shortages. In the
medium term, businesses must remain cautious through this transition to the
"new normal".
Thanks to the diverse nature of the portfolio, across investment stage,
sectors and end markets, Foresight remains confident that its portfolio
is well positioned to respond to new challenges as the market adapts to an
evolving macro landscape.
Fundraising
With regard to retail funds, Foresight VCT plc announced the launch of an
offer for subscription to raise up to £20 million, with an over‑allotment
facility to raise up to a further £10 million. The fundraise is progressing
well and applications will close in April 2022. Post period end, Foresight
Enterprise VCT plc announced that it also intends to launch an offer for
subscription to raise up to £20 million, with an over-allotment of up to £10
million. The Prospectus, which will contain full details and the terms and
conditions of the offer, is expected to be available in January 2022.
Within institutional fundraising, in May, Foresight held the first close of
its latest regional Private Equity fund, the North West-focused Foresight
Regional Investment III LP. The Fund raised an initial £66 million from
investors, exceeding the size of the previous Foresight fund focused on this
region.
The Fund is cornerstoned by the Greater Manchester Pension Fund, with support
from Clwyd and Merseyside Pension Funds. Like its predecessor, the Fund is
targeting investments in established SMEs valued at up to £30 million in
North West England, North Wales and beyond.
Despite the challenges COVID-19 presents in the medium term, the UK remains an
excellent place to start, scale and sell a business, with broad pools of
talent and an entrepreneurial culture.
Foresight believes that transactions between £1-£5 million are the least
competitive and most attractive in the UK Private Equity market, from a value
creation perspective. The economic consequences of COVID-19 will only widen
the SME equity gap, increasing the number of attractive opportunities
available to our funds. New investments will be well positioned to benefit
from the growth phase of the next economic cycle.
FORESIGHT CAPITAL MANAGEMENT
£1.4bn
FUM AT 30 SEPTEMBER 2021
£208m
NET INFLOWS IN THE SIX-MONTH PERIOD
Overview
Foresight Capital Management ("FCM") was established in 2017 to facilitate
retail and institutional investors accessing infrastructure, renewables and
real estate investment opportunities through actively managed open-ended
funds investing in listed securities.
Following continued strong fundraising and investment performance, as well as
the addition of a new mandate, as at 30 September 2021, FUM totalled
£1.4 billion compared to £1.1 billion at 31 March 2021, an increase of
20% over the six‑month period.
The portfolio currently comprises the FP Foresight UK Infrastructure Income
Fund ("FIIF"), launched in December 2017; the FP Foresight Global Real
Infrastructure Fund ("GRIF"), launched in June 2019; the FP Foresight
Sustainable Real Estate Securities Fund ("REF"), launched in June 2020; and
the VAM Global Infrastructure Fund ("VAM"), launched in June 2021.
As the open-ended funds represent a growing proportion of Foresight's total
AUM, FCM is now treated as a separate business line within the Group,
alongside Infrastructure and Private Equity.
FCM open-ended funds
An open-ended investment company ("OEIC") is a professionally managed FCA
authorised company which purchases shares in other financial assets or
companies. When units are purchased in an OEIC, the OEIC fund manager pools
that money with that of other investors. This allows individual investors
access to a greater variety of financial assets.
The value of an OEIC is directly linked to the performance of its underlying
investments. As the value of the underlying investments change, so do the
value of the units purchased.
FCM works with a third party to provide detailed reporting on alignment with
sustainability and regulatory disclosure requirements where relevant. All our
OEICs are aligned with a bespoke ESG policy in order to vote in a manner that
is consistent with widely accepted ESG practices. If an investment fails to
meet our sustainable investment criteria, FCM will divest.
FP Foresight UK Infrastructure Income Fund ("FIIF")
FIIF harnesses Foresight's infrastructure investment expertise and taps into
the demand for low volatility, predictable index-linked income. Launched in
2017, FIIF has grown to total net assets in excess of £620 million at 30
September 2021. The portfolio comprises listed companies active across
renewable energy, core infrastructure and real estate with a UK focus.
FP Foresight Global Real Infrastructure Fund ("GRIF")
GRIF invests in the publicly traded shares of companies located in developed
economies that own or operate real infrastructure or renewable energy assets
anywhere in the world. With a growth‑focused investment objective, GRIF was
launched in June 2019 and has grown its total net assets to more than
£590 million at 30 September 2021 in just over two years.
FP Foresight Sustainable Real Estate Securities Fund ("REF")
REF was launched in June 2020 to provide investors with exposure to a highly
liquid and globally diversified portfolio of Real Estate Investment Trusts.
Given the lack of OEICs in the UK that are addressing both sustainability and
real estate, REF is a highly differentiated strategy and one that has
delivered both strong returns and low risk characteristics for investors since
launch.
Fundraising and performance
During the period, the OEICs have continued to generate positive net inflows
every month, bolstered by the launch of the VAM mandate (see details below).
Retail fundraising delivered net inflows of £208 million between 1 April 2021
and 30 September 2021 (of which £22 million was raised into VAM by its
distribution team).
All three of the UK OEICs (FIIF, GRIF and REF) have delivered positive total
returns during the period, and continue to deliver performance since inception
in line with, or in excess of, their investment objectives (VAM not included
below given it launched during the period).
UK OEIC performance since inception
Fund Inception date Fund
FP Foresight UK Infrastructure Income Fund 4 December 2017 35.29%
FP Foresight Global Real Infrastructure Fund 3 June 2019 47.39%
FP Foresight Sustainable Real Estate Securities Fund 15 June 2020 20.64%
Growth
On 1 June 2021, Foresight announced the launch of VAM Global Infrastructure
Fund ("VAM"), a Luxembourg UCITS V Fund, through a new partnership with VAM
Funds, a Luxembourg-based SICAV fund management company. Foresight Capital
Management has been appointed investment manager to VAM, which is being
distributed in South Africa, Singapore, the Middle East and Europe through
VAM's established global distribution platform. VAM's investment strategy
mirrors that of GRIF, with a focus on globally listed asset-owning
infrastructure and renewables businesses, tapping into the growth potential
and attractive risk-adjusted returns available to investors in these asset
classes. This partnership has already delivered positive results, with net
inflows of £22 million during the four months of the period that the mandate
was in place. Underlying investors in the VAM fund have included clients in
South Africa and the Middle East; markets where Foresight has not previously
raised retail capital.
Post period end Foresight launched a new SICAV. This will initially provide
investors with access to the GRIF investment strategy via a
Luxembourg-domiciled SICAV with UK tax reporting status. The addition of
further strategies to the SICAV, such as REF, will also form part of the
medium-term growth strategy for Foresight Capital Management.
The growing OEIC market in the UK provides positive tailwinds for retail
fundraising and Foresight's FUM in the near to medium term. The launch of
other new open-ended funds, also drawing on Foresight's core competencies and
with a sustainability focus, is being considered.
SUSTAINABILITY
ENVIRONMENTAL, SOCIAL & GOVERNANCE
Acting conscientiously as a company and investing responsibly are critical to
the long-term success of both Foresight and the capital it manages.
Response to COP26
Following the COP26 agreement, there is likely to be an increased demand for
infrastructure and PE investments which simultaneously deliver measurable
sustainable impact alongside attractive risk-adjusted returns. Foresight is
already acting on climate change and protecting the natural environment by
investing in sustainable infrastructure and real assets that contribute in a
tangible and measurable way to decarbonisation.
Investing in renewables that support the phase out of fossil fuels, investing
in the decarbonisation of transport and investing in the sustainable
production of timber used in construction and packaging, are only a few of the
strategies being actively pursued that seek to address some of the greatest
challenges the global community is facing.
SMEs have a key role to play in driving long-term sustainable economic growth.
This is particularly true in the UK outside of London and the South East,
where levels of economic activity, social mobility and economic growth are
commonly lower.
Foresight's Private Equity team has a regional approach, investing in some of
the more disadvantaged areas of the UK, and targeting a clear equity gap, for
both capital and expertise. However, many SMEs struggle to identify how to
harness sustainability and adapt to systemic challenges such as climate
change, human rights and globalisation.
Foresight works with companies to increase their efficiency, differentiate
them from their competitors and drive real change. We believe putting
sustainable principles at the heart of these businesses provides them with the
greatest opportunity to succeed.
SUSTAINABLE INVESTOR
● Signatory to the Principles for Responsible Investment since 2013
● Investments assessed for alignment to UN Sustainable Development Goals
● Bespoke methodologies used to assess and monitor ESG across Infrastructure,
Private Equity and Foresight Capital Management investments
● As a signatory to the Investing in Women Code, we are committed to producing
statistics from across the investment cycle and driving concrete action
● Foresight has joined the Sustainable Markets Initiative: Natural Capital
Investment Alliance ("NCIA") to accelerate the development of Natural Capital
as a mainstream investment theme and mobilise this private capital efficiently
and effectively for Natural Capital opportunities
● Signatory of Playfair Capital's Female Founder Office Hours initiative,
alongside 100 investors and over 300 female founders
● Partnered with a third party to perform enhanced due diligence across our key
solar supply chain counterparties
● Suite of sustainability KPIs launched across our infrastructure assets
RESPONSIBLE BUSINESS
· Climate change readiness
- We continue to establish our TCFD reporting methodology and have
completed our carbon footprinting analysis on our corporate business
activities
- Aiming to establish science-based emissions targets in 2022
· People and community
- Mandatory unconscious bias training has been conducted for all staff
· Supporting a diverse and inclusive culture
- Established our Inclusion & Diversity committee and rolled out the
"Count Me In" initiative, which aims to improve the diversity data that our
staff share with us. This will help us to make meaningful commitments for our
business and staff long term
- Signatory to the HM Treasury Women in Finance Charter
· Communication and transparency
- In September, we hosted Foresight Sustainability Week in partnership
with the Goodwood Estate
https://www.foresightgroup.eu/insight/watch-on-demand-foresight-sustainability-week/
25%
WOMEN IN SENIOR MANAGEMENT POSITIONS WITHIN FORESIGHT
82%
RESPONSE RATE TO SHARING OF PERSONAL DIVERSITY DATA IN OUR "COUNT ME IN"
INITIATIVE
A+, A+, A
FORESIGHT'S PRI SCORES
RISKS
The Board is accountable for risks and has oversight of the risk management
process across the Group. The Board is also responsible for establishing the
risk culture across the Group's businesses and functions.
Our approach to risk management
The Group's approach to risk management, risk governance and risk appetite are
set out in the risks section of the 2021 Annual Report and is established
through the Risk Management Framework. An effective Risk Management Framework
is driven by "top-down" Board leadership and "bottom‑up" involvement of
management.
Engagement by management at all levels is expected across the Group and is
measured through cooperation with and support of the second line of defence
functions.
The executive oversight of the risk framework is delegated by the Board to the
Chief Financial Officer, who is currently responsible for the risk and control
frameworks across the Group.
The Company has identified nine principal risk areas for the Group which are
set out in the 2021 Annual Report. The risk assessment processes are
continuous and principal risk categories may be updated in the event of
material change to the business constituency or market conditions.
Developments in relation to the UK governance, risk and compliance frameworks
since the publication of the 2021 Annual Report, particularly those which
could potentially have a short to medium-term impact during the period to 31
March 2022, are currently underway in the areas outlined below.
Governance Risk Compliance
· A comprehensive organisational and governance framework, comprising · A comprehensive Risk Management Framework for the Group, including · A regulatory compliance system that includes a
clearly defined staff roles, responsibilities and authorities, supported by a robust and scalable control framework, supported by a dedicated resource risk‑based compliance monitoring programme
Group policies
· Risk aggregation across businesses to deliver aggregate analytics · Governance oversight programme that includes information security
· A framework of policies and procedural documents to ensure to the Executive Committee and the Board and data protection
compliance with applicable legislation, regulations, standards and industry
best practices and quality of service(1) · Communications programme to further staff awareness of their · Additional training and competence activities, such as in-house
responsibilities for managing risks within their respective business areas best practice sessions, external courses, as well as supporting staff
and in support of Group initiatives development via professional qualifications and ongoing CPD
1. The UK operation also undergoes an annual ISAE 3402 review of its
operations.
Three lines of defence
The first line of defence is the businesses and functions themselves, where
day‑to‑day front-line ownership of performance and risk management
resides. Heads of businesses and functions are responsible for implementing
controls to manage risks.
The second line of defence is responsible for the design and implementation of
Group‑wide risk frameworks. The risk function provides additional oversight,
enforcing limits set by the Board, independent measurement and monitoring of
front-line activities, and challenges to measurements and assumptions.
The third line of defence provides external assurance with respect to the
suitability and adequacy of the risk frameworks in place.
Risk governance structure
The Group's principal operation is based in the UK, with the London office
providing support services to all UK regional and global offices. The risk
function is coordinated by the CFO, who is based in London, and the Head of
Governance, who is based in Guernsey. Foresight is committed to following a
three lines of defence model for the Group and is investing additional
resources to develop the independent risk management function, including the
hire of a Head of Risk. Independent oversight is in place through external
audits of the compliance and risk functions, the Group's financial systems and
position, and the Group's information security arrangements related to
ISO 27001.
Risk appetite
As a provider of regulated services, Foresight is required to document its
risk appetite in relation to its entities within the Group. Foresight Group
LLP has its principal office based in London and the risk appetite for this
entity is considered the minimum standard for the Group.
Foresight's risk appetite statement sets out the level and types of risk that
it is willing to assume to achieve its strategic objectives and business
plan.
The risk appetite statement has early warning triggers and hard risk limits
covering business and strategic risk, market risk, credit risk, operational
risk, legal and regulatory risk, financial crime risk, conduct risk
and information security risk.
Risk position versus risk appetite is reviewed annually, with any changes to
key metrics reviewed, challenged, and adopted by the Board if appropriate,
through the risk appetite framework.
DIRECTORS' RESPONSIBILITY STATEMENT
The condensed consolidated half‑year financial statements are the
responsibility of, and have been approved by, the Directors. In that regard,
we confirm that to the best of our knowledge:
● The condensed consolidated half‑year financial statements have been prepared
in accordance with IAS 34 "Interim Financial Reporting" as adopted by the
European Union ("EU") and give a true and fair view of the assets,
liabilities, financial position and profit or loss of the Company and the
undertakings included in the consolidation taken as a whole
● The half-year report includes a fair review of the information required by
sections 4.2.7R and 4.2.8R of the Disclosures Guidance and Transparency Rules
of the United Kingdom's Financial Conduct Authority
By order of the Board
Jo-anna Nicolle
Company Secretary
8 December 2021
INDEPENDENT REVIEW REPORT
to Foresight Group Holdings Limited ("The Group")
Introduction
We have been engaged by the Group to review the condensed set of financial
statements in the half-year financial report for the six months ended 30
September 2021 which comprises the unaudited condensed consolidated statement
of comprehensive income, the unaudited condensed consolidated statement of
financial position, the unaudited condensed consolidated statement of changes
in equity and the unaudited condensed consolidated cash flow statement.
We have read the other information contained in the half-year financial report
and considered whether it contains any apparent misstatements or material
inconsistencies with the information in the condensed set of financial
statements.
Directors' responsibilities
The half-year financial report is the responsibility of and has been approved
by the Directors. The Directors are responsible for preparing the half-year
financial report in accordance with the Disclosure Guidance and Transparency
Rules of the United Kingdom's Financial Conduct Authority.
As disclosed in note 2, the annual financial statements of the Group will be
prepared in accordance with International Financial Reporting Standards
("IFRS") as adopted by the European Union ("EU"). The condensed set of
financial statements included in this half‑year financial report has been
prepared in accordance with International Accounting Standard 34, ''Interim
Financial Reporting'' as adopted by the EU.
Our responsibility
Our responsibility is to express to the Group a conclusion on the condensed
set of financial statements in the half-year financial report based on our
review.
Scope of review
We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, ''Review of Interim Financial Information
Performed by the Independent Auditor of the Entity'', issued by the Financial
Reporting Council for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit conducted in
accordance with International Standards on Auditing (UK) and consequently does
not enable us to obtain assurance that we would become aware of all
significant matters that might be identified in an audit. Accordingly, we do
not express an audit opinion.
Conclusion
Based on our review, nothing has come to our attention that causes us to
believe that the condensed set of financial statements in the half-year
financial report for the six months ended 30 September 2021 is not prepared,
in all material respects, in accordance with EU-adopted International
Accounting Standard 34 and the Disclosure Guidance and Transparency Rules of
the United Kingdom's Financial Conduct Authority.
Use of our report
Our report has been prepared in accordance with the terms of our engagement to
assist the Group in meeting its responsibilities in respect of half-year
financial reporting in accordance with the Disclosure Guidance and
Transparency Rules of the United Kingdom's Financial Conduct Authority and for
no other purpose. No person is entitled to rely on this report unless such a
person is a person entitled to rely upon this report by virtue of and for the
purpose of our terms of engagement or has been expressly authorised to do so
by our prior written consent. Save as above, we do not accept responsibility
for this report to any other person or for any other purpose and we hereby
expressly disclaim any and all such liability.
BDO LLP
Chartered Accountants
London, UK
8 December 2021
BDO LLP is a limited liability partnership registered in England and Wales
(with registered number OC305127).
CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the six months ended 30 September 2021
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
Note £000 £000 £000
Revenue 5 39,707 32,417 69,098
Cost of sales (2,447) (2,331) (4,639)
Gross profit 37,260 30,086 64,459
Administrative expenses 7 (24,130) (21,490) (48,709)
Other operating income 10 250 46 394
Operating profit 13,380 8,642 16,144
Finance income 11 - 2 3
Finance expense 11 (360) (350) (710)
Fair value gains on investments 83 51 192
Share of post-tax profits/(losses) of equity accounted joint ventures 8 (19) 26
Profit on ordinary activities before taxation 13,111 8,326 15,655
Tax on profit on ordinary activities 12 (1,644) (8) (481)
Profit 11,467 8,318 15,174
Other comprehensive income
Items that will or may be reclassified to profit or loss:
Translation differences on foreign subsidiaries 67 (272) (293)
Total comprehensive income 11,534 8,046 14,881
Earnings per share attributable to the ordinary equity holders of the parent
Profit or loss
Basic (£) 14 0.11 0.09 0.15
Diluted (£) 14 0.11 0.09 0.15
The notes on pages 21 to 37 form part of this financial information.
CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
as at 30 September 2021
Audited
Unaudited Unaudited 31 March
30 September 30 September 2021
2021 2020 as restated
Note £000 £000 £000
Non-current assets
Property, plant and equipment 2,838 3,600 3,012
Right‑of‑use assets 19 8,791 9,490 9,120
Intangible assets 3,014 3,099 3,012
Investments at FVTPL 2,196 1,577 2,075
Investments in equity accounted joint ventures 259 215 251
Deferred tax asset 20 860 169 977
Contract costs 15 4,259 648 712
Trade and other receivables 16 3,619 3,549 3,411
25,836 22,347 22,570
Current assets
Contract costs 15 589 91 125
Trade and other receivables 16 17,161 14,773 16,470
Cash and cash equivalents 42,760 11,971 39,431
60,510 26,835 56,026
Assets and liabilities of disposal group classified as held for sale 64 64 64
Current liabilities
Trade and other payables 17 (21,217) (12,469) (20,644)
Loans and borrowings 21 (619) (606) (688)
Lease liabilities 19 (2,239) (2,033) (2,157)
(24,075) (15,108) (23,489)
Net current assets 36,499 11,791 32,601
Non-current liabilities
Loans and borrowings 21 (3,030) (3,673) (3,636)
Lease liabilities 19 (9,308) (10,491) (9,862)
Accruals 18 (184) (438) (295)
Deferred tax liability 20 (516) (544) (1,581)
(13,038) (15,146) (15,374)
Net assets 49,297 18,992 39,797
Equity
Share capital 22 - 1 -
Share premium 22 32,040 (231) 32,040
Own share reserve 22 (402) - -
Share-based payment reserve 22 210 125 -
Group reorganisation reserve 22 30 30 30
Retained earnings 22 17,419 19,067 7,727
Total equity 49,297 18,992 39,797
The financial statements were approved and authorised for issue by the Board
of Directors on 8 December 2021 and were signed on its behalf by:
Gary Fraser
Chief Financial Officer
Geoffrey Gavey
Director
The notes on pages 21 to 37 form part of this financial information.
CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the six months ended 30 September 2021
Share-based Group re-
Share Share Own share payment organisation Retained Total
capital premium reserve reserve reserve earnings equity
£000 £000 £000 £000 £000 £000 £000
Unaudited balance at 1 April 2020 1 - - 101 30 15,701 15,833
Profit for the six months - - - - - 8,318 8,318
Other comprehensive income - - - - - (272) (272)
Contributions by and distributions to owners
Share issue costs - (231) - - - - (231)
Dividends and distributions to equity members - - - - - (1,930) (1,930)
Share-based payments - - - 24 - - 24
Premium on redemption of Preference Shares - - - - - (2,750) (2,750)
Unaudited balance at 30 September 2020 1 (231) - 125 30 19,067 18,992
Profit for the six months - - - - - 6,856 6,856
Other comprehensive income - - - - - (21) (21)
Contributions by and distributions to owners
Premium on issue of shares - 35,000 - - - - 35,000
Share issue costs - (2,729) - - - - (2,729)
Dividends and distributions to equity members - - - - - (16,299) (16,299)
Share-based payments - - - 11 - - 11
Share buyback (cancellation) - - - - - (10) (10)
Transfer of share-based payments to retained earnings on vesting and cessation - - - (136) - 136 -
of Foresight Plan
Premium on redemption of Preference Shares - - - - - (2,002) (2,002)
Redemption of Preference Shares (1) - - - - - (1)
Audited balance at 31 March 2021 - 32,040 - - 30 7,727 39,797
Profit for the six months - - - - - 11,467 11,467
Other comprehensive income - - - - - 67 67
Contributions by and distributions to owners
Dividends - - - - - (1,842) (1,842)
Purchase of own shares - - (402) - - - (402)
Share-based payments - - - 210 - - 210
Unaudited balance at 30 September 2021 - 32,040 (402) 210 30 17,419 49,297
The notes on pages 21 to 37 form part of this financial information.
CONDENSED CONSOLIDATED CASH FLOW STATEMENT
for the six months ended 30 September 2021
Audited
Unaudited six Unaudited six year ended
months ended months ended 31 March
30 September 30 September 2021
2021 2020 as restated
Note £000 £000 £000
Cash generated from operations 9,648 2,372 17,268
Tax paid (1,594) (1) (174)
Bank interest paid 11 (3) (2) (7)
Loan interest paid (97) - -
Interest on ROU lease liabilities 11 (314) (311) (621)
Net cash from operating activities 7,640 2,058 16,466
Cash flows from investing activities
Acquisition of property, plant and equipment (198) (69) (141)
Acquisition of intangible assets (125) (13) (48)
Acquisition of investments at FVTPL (339) (435) (881)
Sale of investments 303 144 230
Proceeds on disposal of fixed assets - - 450
Interest received 11 - 2 3
Proceeds on disposal of Group entities - 819 819
Acquisition of subsidiaries - 2,348 2,348
Net cash from investing activities (359) 2,796 2,780
Cash flows from financing activities
Dividends and distributions to equity members 13 (1,842) (1,930) (18,229)
Share buyback 13 - - (10)
Shareholder loan repaid - - (750)
FGLLP members' capital contributions (38) - 1,455
Redemption and premium on redemption of Preference Shares 13 - (2,750) (4,753)
Purchase of own shares 22 (402) - -
Repayment of lease liabilities (principal) 19 (1,049) (974) (2,570)
Repayment of loan liabilities (principal) (621) - -
Gross proceeds of IPO share issue 22 - - 35,000
Costs of IPO share issue 22 - (231) (2,960)
Net cash from financing activities (3,952) (5,885) 7,183
Net increase/(decrease) in cash and cash equivalents 3,329 (1,031) 26,429
Cash and cash equivalents at beginning of period 39,431 13,002 13,002
Cash and cash equivalents at end of period 42,760 11,971 39,431
Reconciliation of profit before tax to cash generated from operations
Profit before taxation 13,111 8,326 15,655
(Profit)/loss from share in joint venture (8) 19 (26)
Fair value gains on investments (83) (51) (192)
Finance costs 360 350 710
Finance income - (2) (3)
Share-based payment 8 210 24 35
Depreciation and amortisation 1,404 1,298 2,648
(Profit) on disposal of fixed assets - - (170)
Gain on bargain purchase - (174) (174)
Foreign currency gains/(losses) 61 (275) (295)
(Increase)/decrease in contract costs (4,011) 116 19
Increase in trade and other receivables (900) (2,967) (4,526)
(Decrease)/increase in trade and other payables (496) (4,292) 3,587
Total 9,648 2,372 17,268
The notes on pages 21 to 37 form part of this financial information.
NOTES TO THE FINANCIAL STATEMENTS
for the six months ended 30 September 2021
1. Corporate information
Foresight Group Holdings Limited (the "Company") is a public limited company
incorporated and domiciled in Guernsey and whose shares are publicly traded on
the Main Market of the London Stock Exchange. The registered office is
located at Ground Floor, Dorey Court, Admiral Park, St Peter Port, Guernsey
GY1 2HT. The condensed consolidated half-year financial statements for the
six months ended 30 September 2021 (the "Group accounts") comprise the
financial statements of the Company and its subsidiaries (collectively,
the "Group").
2. Basis of preparation
The condensed consolidated half‑year financial statements (the "half-year
financial statements") for the six months to 30 September 2021 have been
prepared in accordance with IAS 34 "Interim Financial Reporting" as adopted by
the European Union ("EU"), the Disclosure Guidance and Transparency Rules
sourcebook of the United Kingdom's Financial Conduct Authority and the
Companies (Guernsey) Law, 2008. They do not include all the information
required for a complete set of IFRS financial statements. Accordingly, the
half‑year financial statements should be read in conjunction with the annual
consolidated financial statements for the year ended 31 March 2021, which have
been prepared in accordance with International Financial Reporting Standards
("IFRS") as adopted by the EU.
The Independent Auditor's Report on the annual consolidated financial
statements for the year ended 31 March 2021 was unqualified and did not
contain an emphasis of matter paragraph. The financial statements for the six
months ended 30 September 2021 and 30 September 2020 are unaudited but have
been subject to review by the Group's auditor.
As the Company listed on the London Stock Exchange on 4 February 2021, the
financial statements for the six months ended 30 September 2020 and
substantially for the year ended 31 March 2021 are when the Group was in
private ownership.
Selected explanatory notes are included to explain events and transactions
that are significant to an understanding of the changes in the Group's
financial position and performance since the last annual consolidated
financial statements for the year ended 31 March 2021.
The financial information is presented in sterling, which is the Company's
functional currency. All information is given to the nearest thousand (except
where specified otherwise).
The half-year financial statements have been prepared on a historical cost
basis, except for investments that have been measured at fair value.
Going concern
These financial statements have been prepared on the going concern basis.
The Directors of the Group have considered the resilience of the Group, taking
into account its current financial position and the principal and emerging
risks facing the business, including the impact of COVID-19 on global markets
and potential implications for the Group's financial performance. The Board
reviewed the Group's cash flow forecasts and trading budgets for a period of
at least 12 months from the date of approval of these accounts, and concluded
that, taking into account plausible downside scenarios that could reasonably
be anticipated, the Group will have sufficient funds to pay its liabilities as
they fall due for that period. Taking into consideration the impact of
COVID-19 on the wider economic environment, the forecasts have been stress
tested to ensure that a robust assessment of the Group's working capital and
cash requirements has been performed. The stress test scenarios adopted
involved severe but plausible downside scenarios with respect to the Group's
trading performance. Any mitigating actions available to protect working
capital and strengthen the balance sheet, including deferring non-essential
capital expenditure and increased cost control, were also taken into account.
In considering the above, the Directors have formed the view that the Group
will generate sufficient cash to meet its ongoing liabilities as they fall due
for at least the next 12 months; accordingly, the going concern basis of
preparation has been adopted.
3. Significant events and transactions
The financial position and performance of the Group was affected by the
following events and transactions during the six months ended 30 September
2021:
Placement fees arising on interim and final closes of Foresight Energy
Infrastructure Partners ("FEIP")
In the six months ended 30 September 2021, FEIP, a sustainability‑led
energy transition infrastructure fund managed by Foresight, had further
interim and final closes giving rise to placement agency fees of £3.9/€4.6
million. A specific accounting policy for costs arising from placement agency
fees is disclosed below, see note 4A.
Commencement of the Share Incentive Plan ("SIP") and first grant under the
Performance Share Plan ("PSP")
As noted in the annual financial statements for the year ended 31 March 2021,
the first grant date of the SIP was 28 February 2021 but was trivial to
account for in that period. Therefore, accounting for the SIP has commenced in
the six months ended 30 September 2021. The first grant date under the PSP
was 6 September 2021 and is accounted for in the six months ended
30 September 2021. See note 4B for the associated accounting policy.
4. Accounting policies
The accounting policies applied in these half-year financial statements are
the same as those applied by the Group in its annual financial statements for
the year ended 31 March 2021 except for the policies below. No new standards
that have become effective in the period have had a material effect on the
Group's financial statements.
A. Contract costs (Placement agency fees)
The Group may enter into placement agency agreements with providers who will
seek to raise investor monies. Where placement agency fees are incremental to
obtaining, extending or modifying a contract with a customer, these fees are
capitalised and then amortised on a systematic basis consistent with the
pattern of transfer of the services to which the asset relates. Where
placement agency fees are not considered to be incremental, these are expensed
as they are incurred. Capitalised placement fees are included within contract
costs.
Retainer amounts paid to placement agents are recognised as an asset. Where
the placement agent is successful in obtaining a contract with a customer, the
retainer amounts are offset against the gross placement agency fees when
incurred. If unsuccessful, the retainer amounts are expensed.
B. Share-based payments
The Group engages in share-based payment transactions in respect of services
receivable from certain participants by granting the right to either shares or
options over shares, subject to certain vesting conditions and exercise
prices. These have been accounted for as equity-settled share-based payments.
The fair value of the awards granted in the form of shares or share options is
recognised as an expense over the appropriate performance and vesting period.
The corresponding credit is recognised within total equity. The fair value of
the awards is calculated using an option pricing model, the principal inputs
being the market value on the date of award and an adjustment for expected and
actual levels of vesting which includes estimating the number of eligible
participants leaving the Group and the number of participants satisfying the
relevant performance conditions. Shares and options vest on the occurrence of
a specified event under the rules of the relevant plan.
Key sources of estimation uncertainty and judgements
The preparation of the half-year financial statements requires management to
make judgements, estimates and assumptions that affect the application of
accounting policies and the reported amounts of assets, liabilities, income
and expenses at the reporting date.
In preparing these half-year financial statements, the significant judgements
made by management in applying the Group's accounting policies and the key
sources of estimation were the same as those that applied to the annual
financial statements for the year ended 31 March 2021.
5. Revenue
The Group's revenue arises largely from the charging of management,
secretarial, Directors', marketing, arrangement and performance incentive
fees. Revenue over the period was as follows:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Management fees 33,655 22,582 50,245
Secretarial fees 695 5,883 9,828
Directors' fees 1,196 1,043 2,306
Recurring fees 35,546 29,508 62,379
Marketing fees 2,114 1,290 2,841
Arrangement fees 1,435 1,610 3,858
Performance incentive fees 609 - -
Other income 3 9 20
39,707 32,417 69,098
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Timing of transfer of services:
Point in time 4,161 2,909 6,719
Over time 35,546 29,508 62,379
39,707 32,417 69,098
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
Contract Contract Contract
liabilities liabilities liabilities
Contract balances £000 £000 £000
At beginning of period (541) (73) (73)
Amounts included in contract liabilities that
were recognised as revenue during the period 541 73 73
Cash received in advance of performance and
not recognised as revenue during the period (56) (20) (541)
At end of period (56) (20) (541)
The timing of revenue recognition, billings and cash collections results in
either trade receivables, accrued income or deferred income in the Statement
of Financial Position. For recurring fees, amounts are billed either in
advance or in arrears pursuant to a management or advisory agreement. The
contract liabilities above reflect the deferred income in trade and other
payables.
6. Business segments
Management monitors the performance and strategic priorities of the business
from a business unit ("BU") perspective, and in this regard has identified the
following three key "reportable segments": Infrastructure, Private Equity and
Foresight Capital Management.
Foresight Capital Management had previously been included within
Infrastructure but as reported in the Business Review in the Annual Report
for the year ended 31 March 2021, from FY22 onwards it is to be treated as
a separate business unit. Accordingly, segmental revenue has been represented
for the year ended 31 March 2021.
Foresight Capital Management commenced in 2017 and had FUM of £1.1 billion at
31 March 2021 which had grown further to £1.4 billion at 30 September 2021.
The Group's senior management assesses the performance of the operating
segments based on revenue.
Revenue is measured in a manner consistent with that in the income statement.
Segmental revenue is set out below:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Infrastructure 24,682 20,229 43,392
Private Equity 9,771 8,881 18,225
Foresight Capital Management 5,254 3,307 7,481
39,707 32,417 69,098
Revenue by region is summarised below:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
United Kingdom 35,017 31,536 65,999
Italy 246 210 1,177
Luxembourg 3,367 90 676
Spain 299 227 533
Australia 778 354 713
39,707 32,417 69,098
Non-current assets (excluding deferred tax assets, contract costs and trade
and other receivables) by region are summarised below:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
United Kingdom 14,338 16,594 15,397
Italy 779 819 808
Luxembourg 1,444 564 778
Spain 535 - 486
Australia 2 4 1
17,098 17,981 17,470
7. Administrative expenses
These are summarised as follows:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Staff costs 16,609 15,519 33,751
Depreciation and amortisation 1,404 1,298 2,649
Legal and professional 1,594 2,116 5,984
Other administration costs 4,523 2,557 6,325
24,130 21,490 48,709
Other administration costs mainly relate to irrecoverable VAT, office costs,
conferences, computer maintenance, travelling and entertainment and sundries.
8. Share-based payments
Expenses arising from share-based payments are summarised below:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Performance Share Plan 134 - -
Share Incentive Plan 76 - -
Foresight Plan - 24 35
210 24 35
Performance Share Plan
The Group's Performance Share Plan allows for the grant of nil cost options
with vesting dependent on the performance of the Group and continued service
by the participant. The first grant of options under the plan was made on 6
September 2021 as approved by the Remuneration Committee. The number of
options awarded totalled 1,071,830 and have been fair valued using a
Monte-Carlo simulation and appropriate retention rate %.
Share Incentive Plan
Under the Foresight Share Incentive Plan ("SIP") for each one partnership
share that an employee buys, Foresight offers two free matching shares. In
each tax year, employees can buy up to £1,800 or 10% of salary (whichever is
lower) of partnership shares from their pre-tax salary. If an employee leaves
the Group, any matching shares held for less than three years will be
withdrawn, i.e. the vesting period of the matching shares is three years with
the performance condition of continuous service. The SIP shares are held in
trust by Yorkshire Building Society (the SIP Trustee). Voting rights are
exercised by the SIP Trustee on receipt of participants' instructions.
At 30 September 2021, the number of matching shares purchased for £402,000
was 95,038. An additional 45,000 shares were transferred into trust from
Foresight Guernsey Limited (see IPO Prospectus) so that the total matching
shares held in trust was 140,038.
Foresight Plan
The Foresight Plan was introduced in 2014 and provided for the grant of shares
to members of staff. Shares granted under the Foresight Plan vested after the
members of staff had reached an uninterrupted period of service of ten years
with Foresight Group (or any of its subsidiaries). The Foresight Plan ceased
in February 2021. Full details of the Foresight Plan were included in the
annual financial statements for the year ended 31 March 2021.
9. Core EBITDA pre shared-based payments
The Group uses Core EBITDA and Core EBITDA pre share-based payments as two of
its key metrics to measure performance because it views these as the closest
profitability number comparable to the Group's recurring revenue model (i.e. a
cash profit number after removing/adjusting for any one-offs, both positive
and negative). Core EBITDA pre share-based payments is shown as the Group
considers that there is no cash alternative and due to their uncontrollable
nature. Core EBITDA and Core EBITDA pre share-based payments may not be
comparable to other similarly titled measures used by other companies and they
have limitations as an analytical tool and should not be considered in
isolation or as a substitute for analysis of the Group's operating results as
reported under IFRS.
The specific items excluded from Core EBITDA and Core EBITDA pre share-based
payments are non-underlying items. Non-underlying items are non-trading or
one-off items disclosed separately below, where the quantum, nature or
volatility of such items are considered by the Directors to otherwise distort
the underlying performance of the Group. The Group has assessed that the
following items are non-underlying items for the purposes of calculating
Core EBITDA and Core EBITDA pre share-based payments:
● Non-operational legal costs. These are costs related to a series of proposed
corporate transactions over the period and redundancy costs relating to a
restructuring of the business. The corporate transaction costs relate to
professional and other costs incurred in preparing the Group for an IPO and
therefore are not considered to be related to the Group's ongoing business
operations. Non operational legal costs of £2.7 million in the financial year
ended 31 March 2021 relate to IPO costs
● Distributions made to members classified as remuneration expenses under IFRS
have been added back as these are considered to be equity transactions. These
expenses were related to distribution of the Group profit. They were variable
as they were dependent on Group profit and also the timing of when the
distributions were made
● Staff advances expensed have been added back as these are not deemed to
reflect the core underlying performance of the business
● Other operating income as per note 10 below which is not expected to recur.
This relates to Shirebrook development fees and grant income from a government
support programme introduced in response to the COVID-19 global pandemic
● Profits or losses on disposal of fixed assets are added back as these are
classed as non‑recurring
● Profits or losses arising on acquisition of subsidiaries are added back as
these are classed as non‑recurring
● All depreciation and amortisation costs are added back
● All financing and taxation costs are added back
A reconciliation of retained profit to Core EBITDA and Core EBITDA pre
share-based payments is set out below:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Net profit after other comprehensive income 11,534 8,046 14,881
Add back depreciation and amortisation 1,404 1,298 2,649
Add back non-operational staff costs
Distributions - 670 2,746
Staff advances expensed 300 - 440
Add back non-operational legal costs - 475 2,744
Profit on disposal of tangible fixed assets - - (170)
Gain on bargain purchase on acquisition of PiP Manager - (174) (174)
Deduct other operating income (250) (46) (394)
Deduct/add back financing 360 348 707
Add back tax 1,644 8 481
Core EBITDA 14,992 10,625 23,910
Share-based payments 210 - -
Core EBITDA pre share-based payments 15,202 10,625 23,910
10. Other operating income
This is summarised as follows:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Fees arising from the Shirebrook development 250 - 348
Grant income - 46 46
250 46 394
Fees arising from the Shirebrook development
The Group is managing the development of a reserve power plant site in
Shirebrook, Derbyshire on behalf of the Foresight ITS product. Development
fees have been accounted for as other operating income when it is virtually
certain that relevant contractual conditions have been met. At 30 September
2021, total fees of £2.4 million had been recognised which reflects total
contractual fees on the development.
Grant income
The Group applied for a government support programme introduced in response to
the COVID-19 global pandemic.
11. Finance income and expense
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Finance income
Bank interest receivable - 2 3
Total finance income - 2 3
Finance expenses
Bank interest payable (3) (2) (7)
Loan interest (accrued) (43) (37) (82)
Interest on lease liabilities (314) (311) (621)
Total interest expense on financial liabilities measured at amortised cost (360) (350) (710)
Net finance expense recognised in the Statement of Comprehensive Income (360) (348) (707)
The above finance income and expense includes the following in respect of
assets (liabilities) not at fair value through profit or
loss:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Total interest income on financial assets - 2 3
Total interest expense on financial liabilities (46) (39) (89)
(46) (37) (86)
12. Taxation
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Current tax
UK corporation tax 2,522 - -
Foreign taxation 68 1 111
Adjustments in respect of prior periods (foreign tax) 2 - 134
Total current tax charge 2,592 1 245
Deferred tax
Origination and reversal of temporary differences (see note 20) (948) 7 279
Recognition of previously unrecognised deferred tax assets - - (43)
Total deferred tax (948) 7 236
Tax on profit on ordinary activities 1,644 8 481
The Group is headquartered in Guernsey and its principal office is in the UK.
The Group also has international offices in Italy, Australia, Spain and
Luxembourg. The Group pays taxes according to the rates applicable in the
countries in which it operates.
13. Dividends and redemptions
Equity dividends, distributions and share buybacks were as follows:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Distributions subsequent to the IPO
Final dividend 1,842 - -
Distributions prior to the IPO
Dividends and distributions to equity members - 1,930 18,229
Share buybacks - - 10
1,842 1,930 18,239
A final dividend of 1.7 pence per Ordinary Share was approved by Shareholders
and paid during the six months ended 30 September 2021 relating to the
previous financial year's results.
Details of distributions prior to the IPO are set out in the annual financial
statements for the year ended 31 March 2021.
Preference Shares
Redemptions on Preference Shares were as follows:
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Redemption of Preference Shares - 2,750 4,753
All profit share redemptions took place prior to the IPO via arrangements in
place between Beau Port Investments Ltd ("BPIL") and Foresight Group CI Ltd.
These arrangements were all terminated before the date of the IPO and all
Preference Shares were fully redeemed and cancelled. Details of redemptions
prior to the IPO are set out in the annual financial statements for the year
ended 31 March 2021.
14. Earnings per share
Basic earnings per share is calculated by dividing the profit attributable to
the owners of the parent company by the weighted average number of shares in
issue during the period less the weighted average number of own shares held
(see note 22).
Diluted earnings per share is calculated by dividing the profit attributable
to the owners of the parent company by the weighted average number of shares
for the purposes of the basic earnings per share plus the weighted average
number of shares that would be issued on the conversion of dilutive potential
Ordinary Shares into Ordinary Shares (see note 8 for Performance Share Plan).
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Earnings
Earnings for the purposes of basic earnings per share, being profit 11,467 8,318 15,174
attributable to the owners of the parent company
Unaudited six Unaudited six Audited
months ended months ended year ended
30 September 30 September 31 March
2021 2020 2021
'000 '000 '000
Number of shares
Weighted average number of shares in issue during the period 108,333 94,918 101,780
Less time‑apportioned own shares held (120) - -
Weighted average number of Ordinary Shares for the purpose
of basic earnings per share 108,213 94,918 101,780
Add back weighted average number of dilutive potential shares 73 - -
Weighted average number of Ordinary Shares for the purpose of diluted earnings 108,286 94,918 101,780
per share
Earnings per share Group (basic) (£) 0.11 0.09 0.15
Earnings per share Group (diluted) (£) 0.11 0.09 0.15
15. Contract costs
Audited
Unaudited Unaudited 31 March
30 September 30 September 2021
2021 2020 as restated
£000 £000 £000
Incremental placement agency fees of which: 4,848 739 837
Non-current assets 4,259 648 712
Current assets 589 91 125
Incremental placement agency fees have arisen from further interim and final
closes of Foresight Energy Infrastructure Partners, see note 3. See note 26
for explanation for adjustment to corresponding amounts.
16. Trade and other receivables
Audited
Unaudited Unaudited 31 March
30 September 30 September 2021
2021 2020 as restated
£000 £000 £000
Trade receivables 13,001 9,058 10,988
Other receivables 3,117 4,112 4,255
Prepayments 2,282 1,952 1,958
Staff advances 2,380 3,200 2,680
Less non-current assets:
Trade receivables 1,979 989 1,471
Other receivables - - -
Prepayments - - -
Staff advances 1,640 2,560 1,940
Current assets:
Trade receivables 11,022 8,069 9,517
Other receivables 3,117 4,112 4,255
Prepayments 2,282 1,952 1,958
Staff advances 740 640 740
17,161 14,773 16,470
The Directors consider that the carrying value of trade and other receivables
approximates to their fair value. Staff advances have been made in order to
retain key staff and are expensed over five years in line with the contractual
terms of the advances but are repayable if the relevant individual leaves the
Group. See note 26 for explanation for adjustment to corresponding amounts.
17. Trade and other payables
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Trade payables 1,096 647 1,175
Accruals 6,452 5,463 8,402
Deferred income 56 20 541
Other payables 8,052 2,482 5,244
VAT and PAYE 2,840 2,873 3,520
Corporation tax 1,140 71 143
Shareholder loan - 750 -
Partnership capital contributions 1,581 163 1,619
21,217 12,469 20,644
Trade and other payables comprise amounts outstanding for trade purchases and
ongoing costs. The Directors consider the carrying amount of trade and other
payables approximates to their fair value when measured by discounting cash
flows at market rates of interest as at the balance sheet date.
Deferred income relates to fees received in advance.
Other payables include payables arising from placement agency fees from the
FEIP interim and final closes.
Corporation tax is the corporation tax charge for the period less payments on
account plus a tax charge which is offset by a corresponding reduction in
deferred tax liabilities (see note 20).
Partnership capital contributions relate to contributions by members to
Foresight Group LLP.
18. Non-current liabilities - accruals
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
LTIP accrual 184 438 295
184 438 295
The LTIP scheme arises in PiP Manager Limited, a company acquired by the Group
in August 2020. See the annual financial statements for the year ended 31
March 2021 for full details of this acquisition.
19. Leases
Set out below are the carrying amounts of the right-of-use assets recognised
and associated lease liabilities (included under current and non-current
liabilities) together with their movements over the period. The leases all
relate to the offices of the Group as set out in the annual financial
statements for the year ended 31 March 2021 plus the new lease entered into by
Foresight Group Luxembourg S.A. in the six months ended 30 September 2021.
The leases are typically of ten years' duration.
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Right-of-use asset
At beginning of period 9,120 10,346 10,346
Additions 578 - 486
Depreciation (907) (856) (1,712)
At end of period 8,791 9,490 9,120
Lease liability
At beginning of period 12,019 13,498 13,498
Short term 2,157 1,945 1,945
Long term 9,862 11,553 11,553
Additions 577 - 486
Lease payment (1,363) (1,285) (2,570)
Interest 314 311 621
Foreign exchange - - (16)
At end of period 11,547 12,524 12,019
Short term 2,239 2,033 2,157
Long term 9,308 10,491 9,862
11,547 12,524 12,019
20. Deferred taxation
Deferred tax assets and liabilities are measured at the tax rates that are
expected to apply to the period when the asset is realised or the liability is
settled, based on tax rates (and tax legislation) that have been enacted or
substantively enacted at the balance sheet date.
The movement on the deferred tax account is as shown below:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
At beginning of period (604) 20 20
Recognised in profit and loss
Tax expense 948 (7) (236)
344 13 (216)
Arising on business combination
Intangible asset - (547) (547)
Available losses - 159 159
At end of period 344 (375) (604)
Deferred tax assets have been recognised in respect of all tax losses and
other temporary differences giving rise to deferred tax assets where the
Directors believe it is probable that these assets will be recovered.
A provision has been made for the deferred tax liability associated with the
recognition of an intangible asset as part of the acquisition of PiP Manager
Limited. Subsequent movement in line with amortisation of the intangible asset
has been recognised in the income statement and at 30 September 2021 the
deferred tax liability was £516,000 (31 March 2021: £530,000, 30 September
2020: £544,000). The fair value of the deferred tax asset recognised for tax
losses was determined to be £159,022 on acquisition, an increase of £109,127
compared to its carrying value.
The movements in deferred tax assets and liabilities during the period are
shown below:
(Charged)/ (Charged)/
credited to credited
profit or loss to equity
Asset Liability Net Unaudited six Unaudited six
Unaudited Unaudited Unaudited months ended months ended
30 September 30 September 30 September 30 September 30 September
2021 2021 2021 2021 2021
£000 £000 £000 £000 £000
Available losses 860 - 860 2 -
Other temporary and deductible differences - - - 1,051 -
Business combinations - intangible asset - (516) (516) 14 -
Business combinations - available losses - - - (119) -
860 (516) 344 948 -
Unaudited six Unaudited six
Unaudited Unaudited Unaudited months ended months ended
30 September 30 September 30 September 30 September 30 September
2020 2020 2020 2020 2020
£000 £000 £000 £000 £000
Available losses 20 - 20 - -
Business combinations - intangible asset - (544) (544) 3 -
Business combinations - available losses 149 - 149 (10) -
169 (544) (375) (7) -
Audited Audited
Audited Audited Audited year ended year ended
31 March 31 March 31 March 31 March 31 March
2021 2021 2021 2021 2021
£000 £000 £000 £000 £000
Available losses 858 - 858 838 -
Other temporary and deductible differences - (1,051) (1,051) (1,051) -
Business combinations - intangible asset - (530) (530) 17 -
Business combinations - available losses 119 - 119 (40) -
977 (1,581) (604) (236) -
At 31 March 2021, a deferred tax liability of £1.1 million was recognised in
relation to income that was booked for accounting purposes but expected to be
taxed in a later period. This income has been taxed in full in the six months
to 30 September 2021. Consequently, the liability at 30 September 2021 is
£nil. This has given rise to a deferred tax credit in the income statement
which is offset by a corresponding current tax charge of the exact same
amount.
21. Other interest-bearing loans and borrowings
This note provides information about the contractual terms of the Group's
interest-bearing loans and borrowings, which are measured at amortised cost.
For more information about the Group's exposure to interest rate and foreign
currency risk, see note 23.
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Current liabilities
Loans 619 606 688
Non-current liabilities
Loans 3,030 3,673 3,636
3,649 4,279 4,324
Terms and debt repayment schedule
Unaudited
30 September
2021
Nominal Carrying
interest Year of amount(1)
Currency rate maturity £000
Unsecured loan GBP 2% 2027 3,649
1. The carrying amount of these loans and borrowings equates to the fair
value.
The movement on the above loans may be summarised as follows:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
At beginning of period 4,324 - -
At acquisition - 4,242 4,242
Interest 43 37 82
Repayment (718) - -
At end of period 3,649 4,279 4,324
22. Share capital and other reserves
Ordinary Shares and Preference Shares
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£ £ £
Share capital
Ordinary Shares - - -
Preference Shares at beginning of period - 849 849
Preference Shares redeemed - (1) (849)
Preference Shares at end of period - 848 -
Ordinary Shares
The Company had issued and allotted share capital of 108,333,333 Ordinary
Shares of nil par value at 30 September 2021 and at 31 March 2021. A
reconciliation of Ordinary Shares prior to the IPO is set out in the
annual financial statements for the year ended 31 March 2021.
Preference Shares
These were held in the books of Foresight Group CI Limited ("FGCI") for the
benefit of Beau Port Investments Limited. The redeemable shares were
redeemable at the sole option of FGCI, had no par value and had no voting
rights, save in respect of any resolution to change the rights attached to
them.
The Articles of Association of FGCI gave it the power to issue an unlimited
number of shares of no par value as permitted by Guernsey law.
These arrangements were all terminated before the date of the IPO and all
Preference Shares were fully redeemed and cancelled.
Share premium
Ordinary Shares issued by the Group are recognised at the proceeds or fair
value received, with the excess of the amount received over nominal value
being credited to the share premium account (net of the direct costs of issue)
as follows:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
At beginning of period 32,040 - -
Cash on primary raise - - 35,000
Transaction costs of primary raise - (231) (2,960)
At end of period 32,040 (231) 32,040
The total transaction costs relating to the IPO amounted to £5.3 million, of
which £3.0 million was taken to the share premium account and £2.3 million
was expensed through administrative expenses in the Statement of Comprehensive
Income in the year ended 31 March 2021.
Own share reserve
The Group operates a Share Incentive Plan as per note 8. The Group operates a
trust which holds shares that have not yet vested unconditionally to
employees of the Group. These shares are recorded at cost and are classified
as own shares.
At 30 September 2021, the total number of shares held in trust was 209,639
including 140,038 of matching shares. Of the 140,038 matching shares, 45,000
had been transferred from Foresight Guernsey Limited (see IPO Prospectus) and
95,038 shares had been purchased at a cost of £402,000.
Share-based payment reserve
The share-based payment reserve represents the cumulative cost of the Group's
share-based remuneration schemes, see note 8.
Group reorganisation reserve
The Group reorganisation reserve consists of the Ordinary Share capital of
FGCI. As there is no investment in FGCI held in the books of any holding
companies (Foresight Group Holdings Limited) this balance is left as a Group
reserve.
Retained earnings
Includes all current and prior period retained profits and losses.
23. Financial instruments - classification and measurement
Financial assets
Financial assets comprise cash and cash equivalents, trade receivables and
other receivables (at amortised cost) and unlisted investments (at FVTPL), as
follows:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Trade and other receivables 18,498 16,370 17,923
Cash and cash equivalents 42,760 11,971 39,431
Investments at FVTPL 2,196 1,577 2,075
63,454 29,918 59,429
Financial liabilities
Financial liabilities measured at amortised cost comprise trade payables,
other creditors and accruals, loans and borrowings and lease liabilities as
follows:
Unaudited Unaudited Audited
30 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Trade payables 1,096 647 1,175
Other payables and accruals 18,925 10,981 18,785
Loans and borrowings 3,649 4,279 4,324
Lease liabilities 11,547 12,524 12,019
35,217 28,431 36,303
Financial risk management
The Group's activities expose it to a variety of financial risks: market risk
(including cash flow interest rate risk), liquidity risk and credit risk. Risk
management is carried out by the Board of Directors. The Group uses financial
instruments to provide flexibility regarding its working capital requirements
and to enable it to manage specific financial risks to which it is exposed.
(a) Market risk
(i) Market price risk
Market price risk arises from uncertainty about the future prices of financial
instruments held in accordance with the Group's investment objectives. It
represents the potential loss that the Group might suffer through holding
market positions in the face of market movements.
The investments in equity and loan stocks of unquoted companies are rarely
traded and as such the prices are more difficult to determine than those of
more widely traded securities. In addition, the ability of the Group to
realise the investments at their carrying value will at times not be possible
if there are no willing purchasers. The potential maximum exposure to market
price risk, being the value of the investments as at 30 September 2021, was
£2.2 million (30 September 2020: £1.6 million, 31 March 2021: £2.1
million).
(ii) Interest rate risk
The Group has only £3.6 million of external debt, related to the PiP
acquisition, with a fixed interest rate. As the interest rates on lease
contracts are also fixed, interest rate risk is considered to be very low.
Floating rate investments relate to the interest-bearing deposit account which
earned interest based on the Bank of England rate of 0.1% at 30 September
2021. As at 30 September 2021, if the interest rate increased or decreased by
ten basis points the interest earned would increase or decrease by £200.
(iii) Foreign exchange risk
The Group is not exposed to significant foreign exchange translation or
transaction risk as the Group's activities are primarily within the UK.
Foreign exchange risk is therefore considered immaterial.
(b) Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its
financial obligations as they fall due. The Group ensures that it has
sufficient cash or working capital facilities to meet the cash requirements of
the Group in order to mitigate this risk. Foresight is financed through a
combination of share capital, undistributed profits and cash.
(c) Credit risk
Credit risk refers to the risk that a counterparty will default on its
contractual obligations resulting in financial loss to the Group. In order to
minimise the risk, the Group endeavours only to deal with companies which are
demonstrably creditworthy and this, together with the aggregate financial
exposure, is continuously monitored. The maximum exposure to credit risk is
the value of the outstanding amount.
The Group does not consider that there is any concentration of risk within
either trade or other receivables. There are no impairments to trade or other
receivables in each of the years presented.
Credit risk on cash and cash equivalents is considered to be very low as the
counterparties are all substantial banks with high credit ratings.
Capital risk management
The Group is equity funded and this makes up the capital structure of the
business. Equity comprises share capital, share premium and retained profits
and is equal to the amount shown as "Equity" in the balance sheet.
The Group's current objectives when maintaining capital are to:
● Safeguard the Group's ability as a going concern so that it can continue to
pursue its growth plans
● Maintain adequate financial flexibility to preserve its ability to meet
financial obligations, both current and long term
● Maintain regulatory capital
● Provide a reasonable expectation of future returns to Shareholders
The Group sets the amount of capital it requires in proportion to risk. The
Group manages its capital structure and makes adjustments to it in the light
of changes in economic conditions and the risk characteristics of
underlying assets. In order to maintain or adjust the capital structure, the
Group may issue new shares or sell assets to reduce debt.
During the six months to 30 September 2021, the Group's strategy remained
unchanged and all regulatory capital requirements of subsidiaries in the Group
were complied with. Foresight Group LLP has documented its Pillar III
disclosures required by the Financial Conduct Authority under BIPRU 11. These
are available on the Foresight Group website or from its registered office.
Fair value hierarchy
Unquoted investments represent the Group's share of the value of the
underlying investments held across various Funds Under Management. These
unquoted investments are valued on a net asset basis by the Group. The actual
underlying investments are valued in accordance with the following rules,
which are consistent with the IPEV Valuation Guidelines. When valuing an
unquoted investment at fair value the following factors will be considered:
i) Where a value is indicated by a material arms-length transaction by
an independent third party in the shares of a company, this value will be used
ii) In the absence of (i), and depending upon both the subsequent trading
performance and investment structure of an investee company, the valuation
basis will usually move to either:
a) an earnings multiple basis. The shares may be valued by applying a
suitable multiple to that company's historic, current or forecast earnings
before tax, interest, depreciation and amortisation (the ratio used being
based on a comparable sector but the resulting value being adjusted to reflect
points of difference identified compared to the sector including, inter alia,
illiquidity); or
b) where a company's under-performance against plan indicates a
diminution in the value of the investment, a write down against cost is
made, as appropriate. Where the value of an investment has fallen permanently
below cost, the loss is treated as a permanent write down and as a realised
loss, even though the investment is still held. The Group assesses the
portfolio for such investments and, after agreement with the relevant manager,
will agree the values that represent the extent to which a realised loss
should be recognised. This is based upon an assessment of objective evidence
of that investment's future prospects, to determine whether there
is potential for the investment to recover in value
iii) Premiums on loan investments are accrued at fair value when the company
receives the right to the premium and when considered recoverable
iv) Where an earnings multiple or cost less impairment basis is not
appropriate and overriding factors apply, discounted cash flow, a net asset
valuation, or industry specific valuation benchmarks may be applied. An
example of an industry specific valuation benchmark would be the application
of a multiple to that company's historic, current or forecast turnover (the
multiple being based on a comparable sector but with the resulting value being
adjusted to reflect points of difference including, inter alia, illiquidity)
The following table shows financial instruments recognised at fair value,
analysed between those whose fair value is based on:
· Quoted prices (unadjusted) in active markets for identical assets
or liabilities (Level 1)
· Inputs other than quoted prices included in Level 1 that are
observable for the asset or liability, either directly (as prices) or
indirectly (derived from prices) (Level 2)
· Inputs for the instrument that are not based on observable market
data (unobservable inputs) (Level 3)
Level 1 Level 2 Level 3 Total
As at 30 September 2021 unaudited £000 £000 £000 £000
Unquoted investments - - 2,196 2,196
Net financial instruments - - 2,196 2,196
Level 1 Level 2 Level 3 Total
As at 30 September 2020 unaudited £000 £000 £000 £000
Unquoted investments - - 1,577 1,577
Net financial instruments - - 1,577 1,577
Level 1 Level 2 Level 3 Total
As at 31 March 2021 audited £000 £000 £000 £000
Unquoted investments - - 2,075 2,075
Net financial instruments - - 2,075 2,075
Transfers
During the period there were no transfers between Levels 1, 2 or 3.
The unobservable inputs may be summarised as follows:
Unaudited
30 September
2021 Significant Change in
fair value unobservable Range Sensitivity fair value
Asset class and valuation £000 inputs estimates factor £000
Net financial instruments 2,196 NAV 1x +/-5% +/- 109.8
As can be seen in the table above, the most significant unobservable input is
in relation to the NAV of the relevant investments. A change of 5% to this
assumption would increase or decrease the value of these investments by
£109,800.
24. Related party transactions
Transactions between the parent company and its subsidiaries, which are
related parties, have been eliminated on consolidation and are not disclosed.
Transactions with key management personnel
The Group considers the Executive Committee ("Exco") members as the key
management personnel and the table below sets out all transactions with these
personnel:
Unaudited six Unaudited six Audited year
months ended months ended ended
31 September 30 September 31 March
2021 2020 2021
£000 £000 £000
Emoluments 600 508 1,050
Partnership profit share - - 3,217
Equity dividends - 275 9,319
Capital redemptions - 2,750 4,763
Other 10 10 25
IPO proceeds - - 148,070
Total 610 3,543 166,444
Other related party transactions
At 30 September 2021, the Group owed Beau Port Investments Limited, a
privately owned company of Bernard Fairman, £265,000 (30 September 2020:
£nil, 31 March 2021: £530,000) in unpaid dividends. This balance is to be
fully repaid by 31 March 2022 and Bernard Fairman has agreed to reduce his
salary for the year ending 31 March 2022 as a result of this dividend.
Details of other transactions with key management personnel for the year ended
31 March 2021, inclusive of the six months ended 30 September 2020, are
included in the annual financial statements for the year ended 31 March 2021.
25. Subsequent events
There are no material subsequent events to report from 30 September 2021 to
the date of issue of these accounts.
26. Restatement of corresponding amounts
As restated As reported Change
31 March 31 March 31 March
2021 2021 2021
£000 £000 £000
Non-current assets
Contract costs - incremental placement agency fees 712 - 712
Trade and other receivables - trade receivables 1,471 - 1,471
Trade and other receivables - staff advances 1,940 - 1,940
Current assets
Contract costs - incremental placement agency fees 125 - 125
Trade and other receivables - trade receivables 9,517 10,988 (1,471)
Trade and other receivables - prepayments 1,958 2,795 (837)
Trade and other receivables - staff advances 740 2,680 (1,940)
As restated As reported Change
31 March 31 March 31 March
2020 2020 2020
£000 £000 £000
Non-current assets
Contract costs - incremental placement agency fees 765 - 765
Trade and other receivables - trade receivables 573 - 573
Trade and other receivables - staff advances 1,280 - 1,280
Current assets
Contract costs - incremental placement agency fees 91 - 91
Trade and other receivables - trade receivables 6,269 6,842 (573)
Trade and other receivables - prepayments 2,042 2,898 (856)
Trade and other receivables - staff advances 320 1,600 (1,280)
Corresponding amounts in the financial statements to 31 March 2021 have been
restated due to reclassification of amounts presented in current assets to
non-current assets and amounts presented in trade and other receivables to
contract costs. These reclassifications are as follows:
· The adjustment to contract costs arises from the reclassification
of capitalised incremental placement agency fees from trade and other
receivables - prepayments. In the annual financial statements for the year
ended 31 March 2021, capitalised incremental placement agency fees were
included in trade and other receivables - prepayments as they were not
material for disclosure as contract costs
· The adjustment to trade and other receivables - trade receivables
from current to non-current arises as amounts were not expected to be
recovered within twelve months of the reporting date in respect of Foresight
Williams Technology EIS Fund management fees
· The adjustment to trade and other receivables - staff advances from
current to non-current arises as the amounts were not expected to be released
to profit and loss within twelve months of the reporting date
GLOSSARY
AITS
Foresight's Accelerated Inheritance Tax Solution
AUM
Assets Under Management (FUM + DUM)
BPIL
Beau Port Investments Limited
CFO
Chief Financial Officer of Foresight Group
Company
Foresight Group Holdings Limited
Core EBITDA
Core earnings before interest, taxes, depreciation and amortisation. See
explanation in note 9 of the financial statements
DUM
Debt Under Management
EIS
Enterprise Investment Scheme
ESG
Environmental, Social and Governance
FCM
Foresight Capital Management
FEIP
Foresight Energy Infrastructure Partners
FGCI
Foresight Group CI Limited
FGLLP/LLP
Foresight Group LLP
Foresight/Foresight Group/Group
Foresight Group Holdings Limited together with its direct and indirect
subsidiary undertakings
FSFL
Foresight Solar Fund Limited
FTE
Full-Time Equivalent
FUM
Funds Under Management
FVTPL
Fair value through profit and loss
FY20/21/22
Twelve months ending 31 March 2020/21/22
H1 FY20/21/22
Six months ending 30 September 2020/21/22
IFRS
International Financial Reporting Standard(s)
IPO
Initial Public Offering
ISAE 3402
International Standard on Assurance Engagements - 3402, Assurance Reports on
Controls at a Service Organisation
ITS
Foresight's Inheritance Tax Solution
JLEN
JLEN Environmental Assets Group
LTIP
Long-term incentive plan
NAV
Net Asset Value
OEIC
Open Ended Investment Company
O&M
Operations and Maintenance
PiP
Pensions Infrastructure Platform
PSP
Performance Share Plan
Recurring revenue
Management, secretarial and Directors' fees
SBP
Share-based payment
Shareholder
Holder of the Company's Ordinary Shares
SIP
Share Incentive Plan
TCFD
Task Force on Climate-related Financial Disclosures
VCT
Venture Capital Trust
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