Business model

Sustainable financial returns – we have a track record of delivering predictable long-term returns and a progressive quarterly dividend.

Diversified portfolio – we provide diversified, resilient exposure to the global drive to creating a more sustainable planet and future. Our diversified investment approach provides investors with an array of benefits including a wider set of opportunities and a lower concentration of risk.

Expert investment management – our experienced team has deep industry knowledge and a strong track record of generating attractive and accretive investment opportunities for JLEN.

Positive societal and environmental impact – ESG considerations are embedded across every aspect of the business while our investments are helping address a wide range of environmental challenges faced by society.

 

FGEN targets income and growth from a dynamic portfolio of diversified infrastructure investments across the UK and mainland Europe that are helping to build a more sustainable world.

 

Objective

FGEN seeks to acquire infrastructure assets with attractive characteristics through the extensive origination network of its Investment Manager.

FGEN seeks to enhance returns, where possible, through active management that identifies opportunities to increase revenues and decrease costs.

FGEN seeks to maintain the assets to a high standard over their lifetime to support the long-term investment outlook of FGEN and its investors

FGEN’s approach to raising new equity capital is consistent with JLEN’s business model objectives. New equity is raised periodically to repay drawings under FGEN’s RCF used to acquire assets. FGEN does not seek to raise more cash than drawings under the RCF and so will not face pressure to deploy capital or suffer a reduction in returns. This assists FGEN in maintaining discipline and targeting attractive assets.

 

Competitive advantage

Investment Manager – Foresight has a strong track record of managing assets in the sector and has access to an extensive pipeline of new projects.

Broad investment mandate/policy – allows for investment across a diversified range of technology sub-sectors and geographies, helping to reduce risks within the portfolio and providing a broader base of assets to consider at the acquisition stage.

Existing portfolio – well established portfolio of assets which have the benefit of strong operational track records and predictable, wholly or partially inflation-linked cash flows supported by long-term contracts.

Sustainability – investment mandate is limited to investment in projects and assets which support a more environmentally friendly approach to economic activity and FGEN invests in assets with long project lives of up to 35 years.

 

Operating model

1. Acquire
   The Investment Manager tracks global megatrends around decarbonisation, resource efficiency and environmental sustainability and uses its network of relationships to originate environmental infrastructure opportunities. These are screened for suitability, and potential opportunities are subject to a full due diligence process to assess risks, valuation assumptions and ESG considerations. Investment approval is multi‑level and culminates in a decision of the Company’s Investment Committee for all material investment decisions.
   
   ESG considerations
   ESG criteria are an integral element of the investment assessment at the acquisition stage. The Investment Manager undertakes a thorough rating analysis against a pre‑determined minimum threshold for that asset class.
   
   
2. Develop, construct, maintain
   Active asset management is employed by the Investment Manager to develop, construct or maintain investment assets depending on their stage of maturity. The Investment Manager applies a strong focus on risk identification and mitigation in order to deliver and maintain assets in line with their investment cases. The Investment Manager seeks development partnerships with experienced partners to secure future pipeline opportunities on a preferred basis. The Investment Manager maintains regular and open communications with the FGEN Board and external asset managers and other operational and corporate counterparties in order to facilitate effective management of the assets.
   
   ESG considerations
   Third-party service providers, sometimes with the assistance of technical advisers, monitor and manage the day-to-day performance of each asset in the FGEN portfolio and these third parties are regularly assessed by Foresight.
   
   
3. Enhance
   Assets are regularly assessed for enhancement opportunities to increase operational and financial performance and to better meet ESG objectives. Where an opportunity appears feasible, the Investment Manager develops an initiative to capture the value identified to the benefit of shareholders.
   
   ESG considerations
   The Investment Manager continually seeks to improve all areas of ESG across the portfolio and new assets are assessed to see where improvements to ESG matters can be made over the tenure of ownership. ESG KPIs help to monitor progress in this area.
   
   
4. Hold/exit
   FGEN’s strategy is to hold its assets over the long term in order to receive ongoing cash yield to support FGEN’s dividend targets. However, it will consider opportunities to generate value for shareholders through the divestment of certain assets as they arise. These opportunities will be evaluated against FGEN’s strategy of diversification and the ability of the asset to generate stable financial returns.
   
   ESG considerations
   Typically, the proceeds from divestments will be used to repay amounts outstanding under FGEN’s RCF and provide further headroom to invest in new assets that provide an attractive risk-adjusted return for investors and that are consistent with FGEN’s ESG objectives.

Our business activities result in 2022/2023

Income for shareholders
7.57p
Dividends of 7.57p declared for year to 31 March 2024

Environmental benefits
1,358GWh of green energy produced during the period
Enough energy to power 284,075 homes with electricity

Social benefits
Over £655,076 provided to local communities
Supporting government net zero carbon emissions targets with a portfolio of assets that support environmentally friendly approaches to economic activity.