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25 Jun 2024 07:00
25 June 2024
Foresight Sustainable Forestry Company Plc
("FSF" or "the Company")
Announcement of half-year results for the six months ended 31 March 2024
Foresight Sustainable Forestry Company Plc, an investment company that invests in UK forestry and afforestation assets, is pleased to announce the publication of its unaudited Interim Results (the "Interim Results") for the six months ended 31 March 2024.
Financial highlights
- The Company recorded a profit for the period of £6.6 million (30 September 2023: loss of £11.3 million).
- Net Asset Value ("NAV") has increased to £175.8 million (30 September 2023: £169.2 million).
- NAV per Ordinary Share has increased to 102.2 pence, a NAV per share return of 3.9% since 30 September 2023.
- The key drivers of the uplift are the upwards revaluation of FSF's properties (+3.7p) and carbon credit recognition (+3.7p), driven by the completion of planting c.2.9 million trees at 13 properties.
- The Company has delivered a total NAV return of 4.2%¹ since IPO.
- As at 31 March 2024, the Company had £2.0 million of cash available and had drawn £18.3 million on the RCF - a gearing ratio of 9.4% of Gross Asset Value.
Key metrics
| As at 31 March 2024 |
Net Asset Value | £175.8 million |
NAV per Share | 102.2 pence |
Total NAV return since IPO ¹ | 4.2% |
Profit for the period | £6.6 million |
¹ Calculated with IPO costs netted off
Summary of NAV key movements in the six months ended 31 March 2024
Item | p/share |
NAV at 30 September 2023 | 98.4 |
Net Afforestation & Restock Expenditure | (1.1) |
Portfolio revaluation gains | 3.7 |
Voluntary carbon credit valuation gains | 3.7 |
Asset Level Operating Expenditure | (1.0) |
Fund Operating Expenditure | (1.5) |
NAV at 31 March 2024 | 102.2 |
Portfolio highlights and outlook
Portfolio highlights
- Approximately 2.9 million trees were planted at 13 afforestation properties during the period.
- 4.3 million trees have been planted across 19 planting properties to 31 March 2024 since IPO in November 2021.
- An additional c.334,000 carbon credits associated with new planting have been recognised on FSF's balance sheet, taking the total number of carbon credits to c.478,000.
- As at 31 March 2024, the total value ascribed towards the creation of carbon credits was £9.2 million (30 September 2023: £2.7 million).
- The property revaluation delivered a gain of £6.4 million in the six month period to 31 March 2024.
Outlook
- Between 31 March 2024 and 10 May 2024, the Company planted an additional c.650,000 trees at four afforestation properties.
- From 10 May 2024 to 30 September 2024, the Company intends to plant c.2.1 million trees at seven afforestation properties.
- From 1 October 2024 to 31 March 2025, the Company intends to plant c.2.3 million trees at 14 afforestation properties.
- By spring 2025, the Company expects to have planted c.9.4 million trees over a total forest area of 5,379 hectares since IPO.
Post period end update
On 29 May 2024, the Board announced that FSF had reached agreement on the terms of a recommended acquisition, pursuant to which Arizona Bidco Limited, a wholly owned indirect subsidiary of Averon Park Limited ("Averon Park"), will acquire the entire issued and to be issued Ordinary Share capital of FSF that Averon Park's group does not already own (the "Acquisition"). Full details of the Acquisition, including the strategic rationale and recommendation of the Directors, can be found here: https://fsfc.foresightgroup.eu/offer-fsfc.
Interim Report
A copy of the Interim Report has been submitted to the National Storage Mechanism and will shortly be available at https://data.fca.org.uk/#/nsm/nationalstoragemechanism. The Interim Report can also be seen on the Company website (https://fsfc.foresightgroup.eu), where you can find all the information about the Company.
Richard Davidson, Chair of Foresight Sustainable Forestry Company Plc, commented:
"We are proud of the achievements the Company has made since its IPO. FSF has amassed and developed a nationally significant afforestation portfolio in a short space of time. The Company has delivered on its objectives to increase domestic timber supply, sequester carbon dioxide from the atmosphere, enhance biodiversity and has created hundreds of jobs within rural communities where it operates. We are pleased with the Company's performance to 31 March 2024, which has seen an unaudited NAV gain of 3.8 pence per share, an increase of 3.9% for the six-month period, due to the successful progress of our planting programme."
For further information, please contact:
Foresight Sustainable Forestry Company Plc Robert Guest Richard Kelly fsfc@foresightgroup.eu
| +44 20 3667 8100 |
Stifel Nicolaus Europe Limited Edward Gibson-Watt Bruno Benega Rajpal Padam Catriona Neville
| +44(0) 20 7663 3227 |
SEC Newgate Elisabeth Cowell Alice Cho Harry Handyside
|
+44 (0)20 3757 6882 fsf@secnewgate.co.uk
|
About the Company
Foresight Sustainable Forestry Company Plc is an externally managed investment company investing in a diversified portfolio of UK forestry and afforestation assets.
Targeting a net total return of more than CPI +5%, the Company provides investors with the opportunity for real returns and capital appreciation driven by the prevailing global imbalance between supply and demand for timber; the inflation-protection qualities of UK land freeholds; and biological tree growth of 3% to 4% not correlated to financial markets.
The Company also offers outstanding sustainability and ESG attributes and access to carbon units related to carbon sequestration from new afforestation planting.
The Company targets value creation as the afforestation projects successfully achieve development milestones in the process of converting open ground into established commercial forest and woodland areas.
The Company is seeking to make a direct contribution in the fight against climate change through forestry and afforestation carbon sequestration initiatives and to preserve and proactively enhance natural capital and biodiversity across its portfolio.
The Company is managed by Foresight Group LLP. https://fsfc.foresightgroup.eu/
Notes
This announcement does not constitute, and may not be construed as, an offer to sell or an invitation to purchase investments of any description, or the provision of investment advice by any party. No information set out in this announcement is intended to form the basis of any contract of sale, investment decision or any decision to purchase securities in the Company.
This announcement may include statements that are, or may be deemed to be, "forward-looking statements". These forward-looking statements can be identified by the use of forward-looking terminology, including the terms "believes", "estimates", "anticipates", "expects", "intends", "may", "will", "targeting" or "should" or, in each case, their negative or other variations or comparable terminology. All statements other than statements of historical facts included in this announcement, including, without limitation, those regarding the Company's financial position, strategy, plans, proposed acquisitions and objectives, are forward-looking statements.
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