Foresight Solar Fund (FSFL) H2 2025 earnings summary

Executive summary

• Achieved strong operational performance in 2025, with UK generation 3.4% above budget offsetting underperformance in Spain and Australia due to curtailment and negative pricing periods.

• Delivered a dividend of 8.10 pence per share for 2025 with 1.3x cover, targeting the same for 2026 with a projected 1.1x cover and a 13.4% yield at March 2026 share price.

• Board remains proactive in exploring options to promote shareholder value, including buybacks, asset cycling, fee revisions, and potential private market solutions.

• Portfolio valuation reflects independently validated assumptions, lifecycle extensions, and incorporates impacts from lower power price forecasts, Australian write-downs, and tax review.

• Returned £56.1 million to shareholders via dividends and share buybacks, with the largest sector-relative buyback program executed.

Financial highlights

• Net Asset Value (NAV) at 31 December 2025 was £545.9m (99.2p per share), down from £634.4m (112.3p) at end-2024, reflecting an 11% decrease.

• EBITDA for 2025 was £112.2m, up from £105.4m in 2024.

• Dividend cover reached 1.3x for 2025, with 2026 expected at 1.1x, supported by contracted revenues and delivered cash flows.

• Buyback program generated over 3p per share of NAV accretion since inception, with 60 million shares repurchased since May 2023.

• Maintained total gearing at 41.2%, below the 50% policy limit, with a weighted average cost of 3.6% per annum.

Outlook and guidance

• Target dividend of 8.10pps for 2026, with expected 1.1x cover; contracted revenue hedges provide 1.0x cover, with upside from uncontracted revenues and merchant exposure.

• Focus on closing the share price discount, strengthening dividend cover, and evolving the development pipeline, including asset cycling and divestment of 75 MW of operational capacity.

• Anticipated wave of UK CFD projects from upcoming auction rounds, presenting new investment opportunities.

• Directors continue to evaluate consolidation, partnerships, and capital structure optimisation.

• Continued emphasis on sustainable, progressive dividends and maintaining revenue visibility through hedging.