Foresight Solar Fund eyes growth and Spanish expansion amid market challenges
May 13, 2024 at 10:51 am EDT
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Foresight Solar Fund Ltd (LSE:FSFL) fund manager Ross Driver joins Proactive's Stephen Gunnion ahead of a capital markets days with an overview of the company's strategy and performance.
Driver outlined the company's initiatives, such as reducing debt, executing a share buyback programme, and investing in developmental stage assets to stimulate future growth. Despite a challenging 2023, the company reported a record year for cash generation, benefiting from high price fixes. Additionally, it utilised significant cash reserves to further the buyback, utilising £30 million of the allocated £40 million.
Driver highlighted the challenges and opportunities within the UK and Spanish energy markets. In the UK, the Battery Energy Storage System (BESS) market has faced issues like reduced wholesale revenues and project overlooks by system operators, necessitating adjustments. Conversely, Spain offers a nascent market, promising due to its high solar penetration and favourable conditions for battery storage.
Driver said Foresight Solar Fund aims to leverage early mover advantages in Spain, developing projects that fit well into the existing grid and anticipating double-digit returns from these initiatives.
Overall, Foresight Solar Fund is focusing on maintaining strong yield and net asset value (NAV) preservation while looking for growth opportunities through development, targeting a 1-2% NAV increase over time.
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Foresight Solar Fund Limited is a Jersey-based closed-ended investment company with a diversified portfolio of solar photovoltaics (PV) and battery storage assets. The Companyâs investment objective is to provide investors with a sustainable and progressive quarterly dividend underpinned by investments in a geographically diverse portfolio of assets. It aims to deliver sustainable investment returns to investors alongside environmental, social and governance (ESG) benefits. The Company acquires ground-based, operational solar power plants. It is also permitted to invest in utility-scale battery storage systems up to a limit of 10% of the GAV of the Company, calculated at the time of investment. Its diversified portfolio consists of 61 assets with a total global peak capacity of 1.1 gigawatt (GW). Its assets include Highfields, Castle Eaton, High Penn, Hunters Race, Spriggs Farm, Kencot Hill, Copley, Paddock Wood, Southam, Port Farm, Sandridge, Wally Corner, Park Farm and others.