(Alliance News) - Foresight Solar Fund Ltd on Tuesday said there were reasons for optimism after a challenging year saw its net asset per share decline.
The Jersey-based sustainability-focused fund investing in solar and battery storage assets in the UK and internationally reported in 2023 its NAV per share fell 6.4% to 118.4 pence from 126.5p in 2022.
Shares in Foresight Solar eased 0.6% to 90.40p each in London on Tuesday.
The company said the uplift from the sale of the Lorca portfolio stake at a 21% premium to holding value, alongside an active power price hedging strategy, mitigated the negative impacts from higher discount rates and softening power price forecasts.
In November, Foresight Solar said it sold a 50% stake in its 99 megawatt Lorca portfolio in Spain for EUR26.9 million.
The Lorca portfolio includes 30 MW solar farm Las Salinas, 49MW Los Llanos, and 20MW Los Picos. Foresight bought the assets three years ago.
Despite the lower NAV per share, Foresight Solar increased the annual dividend to 7.55p from 7.12p, a 6.0% increase.
It is targetting a further 6% increase in 2024 which would take the dividend to 8.00 per share.
Foresight Solar said the 2024 target is expected to be 1.50 times covered from cash generated in the period, with around 1.35x cover for 2025, assuming current revenue forecasts.
Chair Alexander Ohlsson described the performance as "resilient" with record electricity production and cash distribution against a "challenging market backdrop".
"After a challenging year for markets, we believe there are reasons for optimism. The energy transition is one of the biggest investment themes of our generation. The solar power opportunity alone is immense. Industry fundamentals remain attractive and solar generation continues to be one of the cheapest and most reliable sources of electricity available. This promising outlook, coupled with Foresight Solar's improved financial position and clear strategy to deliver income and growth, positions the fund well to capitalise on the opportunities ahead."
By Jeremy Cutler, Alliance News reporter
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Foresight Solar Fund (FSFL)