Foresight Group hikes dividend after solid first half

(Sharecast News) - Foresight Group reported a solid set of first-half results on Thursday, underpinned by growth in assets under management and a strong fundraising performance. The FTSE 250 company's assets under management increased 2% for the six months ended 30 September to £12.43bn, while funds under management rose 3% to £8.67bn.

Total revenue grew 8% to £73.2m, supported by successful fundraising into higher-margin and longer-tenure vehicles.

Core EBITDA pre-share-based payments rose 5% to £29m, aligning with the company's medium-term goal to double the metric over five years.

Fundraising highlights included a €300m first close for Foresight Energy Infrastructure Partners II and £241m raised in higher-margin retail vehicles.

Foresight Capital Management contributed £56m in positive investment performance, alongside slowing net outflows of £111m.

The board said the private equity division generated £4.3m in performance fees, and completed a £50m first close for the Foresight South West Fund after the period end.

Recurring revenue remained robust at 87% of total revenue, within the group's target range of 85% to 90%.

Despite a slight decline in the EBITDA margin to 39.6%, Foresight said it maintained operational momentum across its infrastructure and retail-focused strategies.

The board declared an interim dividend of 7.4p per share, up 10% from 6.7p last year, continuing its policy of distributing 60% of profit after tax before non-underlying items.

It said the dividend would be paid on 31 January, with an ex-dividend date of 16 January.

"During the first half, the group delivered another period of organic profit growth, driven by positive momentum across our diversified business," said executive chairman Bernard Fairman.

"Our highly scalable strategies bring investors closer to some of the world's most exciting investment opportunities, and recent interest rate reductions should improve investor sentiment further.

"Against this backdrop, our flagship institutional energy transition fund, FEIP II, is making good progress towards a further close as we target a total fund size of €1.25bn."

Fairman said the firm's second dedicated natural capital strategy had now entered pre-marketing, while its listed equities products delivered positive performance and decelerating net outflows in the half-year.

"The well-established retail sales team is on track for a record year of fundraising for our tax efficient retail strategies.

"Post period end, our private equity division launched its 14th active regional fund in the South West of England, with further fundraising anticipated in the near-term.

"Fundraising progress across the Group's diversified strategies is in line with expectations and keeps us on track to deliver our guidance to double profit over five years."

At 0823 GMT, shares in Foresight Group Holdings were down 1.25% at 444.36p.

Reporting by Josh White for Sharecast.com.