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FORESIGHT SOLAR & INFRASTRUCTURE VCT PLC
Ordinary Shares Total Net Assets as at 31 March 2019: £41.7m
Ordinary Shares Net Asset Value per share as at 31 March 2019: 96.4p
Ordinary Shares Dividends paid during the nine months ended 31 March 2019: 3.0p
I am pleased to present the Annual Report and Accounts for Foresight Solar & Infrastructure VCT Plc and to provide you with an update on developments. As reported at the time of our interim results, the Board decided to change the year end to 31 March partly to align with the tax year end so we are currently reporting on a nine month period. Following the share class merger between the Ordinary, C and D Shares at the end of the last financial year, the Company has seen success in supplementing and enhancing the value of the existing portfolio.
PERFORMANCE AND PORTFOLIO ACTIVITY
The underlying net asset value increased by 6.4p per Ordinary Share before deducting the 3.0p per Ordinary Share dividend paid during the nine month period.
This has been driven by the increase in valuation of the UK portfolio, with production 7.6% above expectations at 46.51 gigawatt hours of electricity, sufficient to power approximately 15,000 UK homes for a year.
Existing portfolio companies also completed the acquisition of five UK solar assets, Basin Bridge, Stables, Dove View, Beech Farm and Hurcott, adding a total of 25.8MW of capacity to the portfolio. In addition to this, existing portfolio companies committed an amount into ForVEI II, the second joint venture partnership between Foresight and VEI Capital. During the period, ForVEI II successfully completed the acquisition of three plants with a total capacity of 2.9MW located in Apulia and Sicily in Italy.
These additions support the Ordinary Shares fund’s objective of continuing to deliver its target dividends and maximising long-term future returns for Shareholders, and the Board now consider the Ordinary Shares fund to be optimally invested. The Company ended the period with investments in portfolio companies with total generating capacity of 78.0MW compared with 49.3MW at 30 June 2018.
The Board also note that following its long running arbitration case with the Spanish Government with respect to retrospective changes to feed-in-tariffs on its previously held Spanish assets, the VCT has been awarded an amount of £2m-£2.5m, equivalent to 4.6-5.8p per share. However, given that no such awards against the Spanish Government have, as yet, been settled or collected, there remain significant challenges with respect to collectability. On that basis, the Board have not assigned any current value to the claim in the net asset value reported.
The overall performance of the Ordinary Shares fund remains robust and the total return since inception as at 31 March 2019 was 134.4p per Ordinary Share.
CASH AND WORKING CAPITAL
The Company had cash and liquid resources of £2.3m at 31 March 2019 (excluding cash held in portfolio companies).
The Board acknowledge that the Company is currently in a net current liabilities position, which is primarily driven by a loan of £15m with the Company’s wholly owned subsidiary, Youtan Limited, which is repayable on demand as at the period end date. The Board consider this to be a timing issue and additionally the directors of Youtan have asserted that they do not intend to call upon the loan from the Company in the next 12 months from the date of this report.
The Company receives regular interest and loan stock payments and dividends from its underlying investments enabling it to continue to fund its dividend policy as well as meeting expenses in the ordinary course of business as they fall due.
In its original prospectus the Board’s stated objective was to pay dividends of 5.0p per Ordinary Share each year throughout the life of the Company after the first year. The level of dividends was not, however, guaranteed.
During the nine month period, total dividends of 3.0p per Ordinary Share were paid, with a further 3.0p per Ordinary Share dividend paid post period end on 26 April 2019. This means that total dividends of 41.0p per Ordinary Share have been paid during the nine years since launch.
Despite the change in the Company’s year end, the Board intend to remain aligned with the existing dividend timetable, that is payments in April and November every year.
SHARE ISSUES & BUYBACKS
During the period under review, the Ordinary Shares fund repurchased 663,597 shares for cancellation at a cost of £619,000, at an average discount to NAV of 1.5%. No new shares were issued during the period. A table of intended communications to shareholders and likely tender offers is included on page 21 of the Annual Report and Accounts.
The annual management fee of the Ordinary Shares fund is calculated as 1.5% of Net Assets and equated to £467,000 during the period.
PERFORMANCE INCENTIVE FEE
Prior to the implementation of the share class merger in the last financial year, the performance incentive hurdle for the C shares was satisfied, resulting in an accrual of £130,000 due to the Manager. This was paid during the period.
There were no other performance incentive fees paid or accrued.
LAUNCH OF NEW SHARE CLASS AND BOARD COMPOSITION
As discussed in previous communications, VCT Rules have prohibited the making of new investments into any type of energy generation activity, including photovoltaic solar, for some years now. These restrictions have recently been extended to prohibit the making of investments into companies which do not meet a widely drawn ‘risk to capital’ condition.
These legislative developments have not materially affected existing Ordinary Shareholders. The Ordinary Share class was fully invested before these changes took effect and, in the opinion of the Board and the Manager, is now optimally invested.
In that context, the Board have therefore considered the future direction of the Company, noting that any new fundraising which the Company undertakes will need to have a different, but complementary, profile from its historic share classes. The Board have recently been discussing the possibility of a new VCT share class which will invest in a number of exciting engineering and technology based companies. I am pleased to confirm that we are progressing well with this possibility, and I hope to write to shareholders in the near future seeking approval for the launch of such a share class.
In anticipation of shareholder support for this development, the Board were delighted to welcome Ernie Richardson as a Director of the Company. Ernie, who was appointed as a Non-Executive Director of the Company in January this year, has extensive experience in the venture capital industry and previously served as the Chief Executive Officer and Managing Partner of MTI Partners Limited. The Board believe Ernie will provide invaluable experience with his background in the growth capital space.
Having been Chairman of the Company since 2012, I have decided to retire from the Board at the upcoming AGM and am delighted that Ernie will be taking on the role of Chairman.
Also as communicated in the Interim Report, the Board offered shareholders the opportunity to elect the method by which they receive shareholder communications. I am pleased to announce that 88% of communications to investors will now be provided electronically. The Board believe that in addition to further promoting sustainability, a key objective of the fund, this shift will result in some overall cost savings.
ANNUAL GENERAL MEETING
The Company’s Annual General Meeting will take place on 19 September 2019 at 12.30pm. I look forward to welcoming you to the Meeting, which will be held at the offices of Foresight Group in London.
The Company’s solar portfolio continues to generate a steady flow of dividends with limited scope for further development. Accordingly, once all Ordinary Shareholders have reached their minimum 5-year qualifying holding period, the Board and the Manager will, if appropriate, begin a managed process of returning the value of the Ordinary Shares fund to its Shareholders.
In the meantime, I will be writing to shareholders later this year with respect to the opportunity to participate in the next tender offer for shares.
Also as mentioned above, I hope to provide further communications regarding the launch of a new share class within the VCT soon.
30 July 2019
Investment Manager’s Review
During the period to 31 March 2019, existing portfolio companies made investments in five operational UK solar assets, with a total capacity of 25.8MW. The first four solar projects were acquired in August 2018. Basin Bridge Solar and Stables Solar are situated in Leicestershire and have a capacity of 5.0MW and 2.0MW respectively. Dove View and Beech Farm are both in Staffordshire and have a capacity of 4.5MW and 4.3MW respectively. In November 2018 a further investment was completed, acquiring Hurcott Solar in Somerset, with a total production capacity of 10.0MW. These five ground-mounted solar projects, which benefit from long-term ROC subsidy payments, were acquired from other funds managed by Foresight and were supported by independent valuations from a third-party valuation expert. Previous Foresight ownership was beneficial in allowing for a more cost-efficient and lower risk acquisition process. Additionally, the assets had been in operation for a minimum period of two years and managed by Foresight Group’s Asset Management team, thereby ensuring the quality of the assets as well as securing a clear advantage in continuing to manage these assets going forwards.
In July 2018, existing portfolio companies also invested in the ForVEI II Italian solar platform. During the period ForVEI II made investments in two groundmounted solar assets in the Apulia region of southern Italy and one in Sicily, with a total capacity of 2.9MW. The plants receive long-term subsidies under the Italian Feed-in Tariff regime.
Post period end, the Investment Manager has agreed the sale of the small Italian rooftop asset, Telecomponenti.
The debt refinancing of the Laurel Hill site, provided by Royal Bank of Scotland, was completed in August 2018. The refinancing proceeds have been used to repay the majority of the borrowings originally used to finance the acquisition.
Performance of the assets was positive during the period 1 July 2018 to 31 March 2019 with total electricity production 7.6% above expectations. The UK assets generated a total of 46.51GWh, enough clean electricity to power more than 15,000 homes. This strong performance reflects higher than average irradiation levels and good availability of the solar plants. There will be variances in performance caused by irradiation or the efficiency of the plants, but this does not require adjustment to the long-term forecasts. Further details on performance of the individual assets are included on pages 10 to 16 of the Annual Report and Accounts.
REGULATORY AND MARKET CHANGES
Renewable power generation in the UK has continued to increase, with solar and wind representing a growing share of the country’s power mix. At the beginning of May 2019 Britain went for a week without using any coal to meet its electricity requirements. This was repeated later in the month, when a new record of 14 consecutive coal-free days was set - the longest such period since 1882 and just two years since the UK’s first 24-hour coal-free period.
In the five years to 2018 renewable capacity has tripled while fossil fuel capacity has fallen by a third due to the decommissioning of fossil fuel generators. In December 2018, total installed solar capacity in the UK reached c.13,096MW across c.976,200 installations, an increase of 2.1% (c.268MW) since December 2017. This modest growth was predominantly supported by new domestic rooftop installations and some ground mounted assets in Northern Ireland. This reduction in growth results from the closure of the Renewables Obligation (“RO”) scheme in April 2017. As anticipated, there have been no new large-scale solar assets constructed in the UK following the closure of the RO scheme. We expect this to remain the case in the foreseeable future, with investment activity in the sector focused on secondary market acquisitions of operational assets. The UK solar market continued to experience a period of consolidation with a significant number of secondary transactions taking place. The level of activity in the secondary market, associated with the absence of new construction of large-scale solar assets, resulted in increased competition for the acquisition of operational assets. In November 2018, Ofgem released a consultation on the Targeted Charging Review (“TCR”), which was launched initially in August 2017 as part of a review into residual network charging arrangements. The update included a number of proposed reforms, which would likely result in a reduction in revenues received by UK embedded generation assets which currently benefit from embedded benefits and could also result in an increase in network charges. Whilst the exact nature of the proposed changes is still to be confirmed, if taken forward in their present form they would be phased in from 2021. It should be noted that embedded benefits revenue represents just c.2.5% of revenues for the portfolio during the period. Despite limited growth in the solar market, the UK renewables market has continued to thrive.
The uncertainty surrounding Brexit has not yet lifted as post-period end in April 2019 the UK was granted a six-month extension to the deadline for the UK to leave the EU. The Investment Manager does not consider the Company to be particularly sensitive to the various scenarios that could unfold ahead of the new 31 October cut-off date. The energy market in the UK is closely aligned with European markets and this is not expected to change over the long term. As an example, the draft political declaration made in November 2018 sets out a desire to “consider cooperation on carbon pricing by linking a United Kingdom national greenhouse gas emissions trading system with the EUs Emissions Trading System”. An exit from the EU could cause volatility in the energy markets, that volatility in itself could lead to slightly higher electricity prices in the short term. Longer term impacts such as weaker economic demand and the availability of unskilled labour are not deemed material to the future operations of the Company.
During the period, 58.5% of revenue from UK portfolio investments came from subsidies (predominantly under the ROC scheme) and other green benefits to an offtaker. These revenues are directly and explicitly linked to inflation for 20 years from the accreditation date under the ROC regime and subject to Retail Price Index (“RPI”) inflationary increases applied by Ofgem in April of each year. The majority of the remaining 41.5% of revenues derive from electricity sales by our UK portfolio companies which are subject to wholesale electricity price movements.
The average power price achieved during the period was £54.20 per MWh, representing an increase on the price achieved in the 12 months to 30 June 2018 (£46.77 per MWh.)
From July 2018 prices initially increased due to increasing commodity prices, principally gas and carbon prices. More recently electricity prices have dipped as new natural gas supplies from the US and Australia entered the market. Coupled with historically high gas storage levels in Western Europe and one of the mildest winters on record, this has decreased prices for natural gas and subsequently put downward pressure on electricity prices.
Nonetheless, during the period 1 July 2018 to 31 March 2019 there was a 2.9% increase in long term power price forecasts. The Investment Manager uses forward looking power price assumptions to assess the likely future income of the portfolio investments for valuation purposes. The Company’s assumptions are formed from a blended average of the forecasts provided by third party consultants and are updated on a quarterly basis. The Investment Manager’s forecasts continue to assume an increase in power prices in real terms over the medium to long-term of 0.27% per annum (30 June 2018: 1.08%).
Power Purchase Agreements (“PPAs”) are entered into between each portfolio company and offtakers in the UK electricity supply market. Under the PPAs, each portfolio company will sell the entirety of the generated electricity and ROCs to the designated offtaker. Under the terms of a PPA, electricity can be supplied at a fixed price for an agreed duration, or at a variable rate.
The PPA strategy adopted by our portfolio companies seeks to optimise their revenues from the power generated, while keeping the flexibility to manage their solar assets appropriately. The Boards of our portfolio companies, with assistance from Foresight, constantly assess conditions in the electricity market and set their pricing strategy on the basis of likely future movements.
During the period, the Investment Manager completed a competitive tender process and identified a new PPA provider for six of the UK assets, representing c.30MW of generating capacity. Following lengthy negotiations to secure the best possible terms, new 10-year contracts were in place from 1 April 2019 with lower fees being charged by the new offtaker. Under the new PPA, the electricity generated is sold at a variable market rate, benefiting from positive market movements, but with the option to fix the price if this becomes attractive.
Sustainability lies at the heart of the Manager’s approach, and the Manager believes that investing responsibly, seeking to make a positive social and environmental impact, is critical to its long-term success. These factors have been integrated into the investment process, and are actively supported by all involved, regardless of seniority. Foresight refined its sustainability tracking in 2018 to further improve its investment processes, enhance the sustainability performance of existing assets and demonstrate more comprehensively the environmental benefits and social contribution of the Company’s activities, implementing Foresight Group’s Sustainable Investing in Infrastructure Strategy. This strategy focuses on ensuring all assets are evaluated prior to acquisition and throughout their ownership, in accordance with Foresight Group’s Sustainability Evaluation Criteria. There are five central themes to the Criteria, which cover the key areas of sustainability. The five criteria are:
1. Sustainable Development Contribution: The development of affordable and clean energy and improved resource and energy efficiency.
2. Environmental Footprint: Assessing potential environmental impact such as emissions to air, land and water, effects on biodiversity and noise and light pollution.
3. Social Engagement: Engagement and consultation with local stakeholders. Ensuring a positive local economic and social impact, community engagement and the health and wellbeing of stakeholders.
4. Governance: Compliance with relevant laws and regulations and ensuring best practice is followed.
5. Third Party Interactions: Third party due diligence is conducted on key counterparties to ensure adherence to the aforementioned criteria where relevant.
Foresight Group remains a working partner of the Solar Trade Association’s Large Scale Asset Management Working Group. Foresight is a signatory to the Solar Farm Land Management Charter and seeks to ensure that the solar farms operated by all of our portfolio companies are managed in a manner that maximises the agricultural, landscaping, biodiversity and wildlife potential, which can also contribute to lowering maintenance costs and enhancing security. As such, Foresight Group regularly inspects sites and advises portfolio companies to develop site specific land management and biodiversity enhancement plans to secure long term gains for wildlife and ensure that the land and environment are maintained to a high standard.
• Management of grassland areas within the security fencing to promote wildflower meadows and sustainable sheep grazing;
• Planting and management of hedgerows and associated hedge banks;
• Management of field boundaries between security fencing and hedgerows;
• Sustainable land drainage and pond restoration;
• Installation of insect hotels and reptile hibernacula;
• Installation of boxes for bats, owls and kestrels; and
• Installation of beehives by local beekeepers.
Most solar parks are designed to enable sheep grazing and the remaining plants are investigated for alterations to ensure that the farmland on which the solar assets are located can remain useful in agricultural production, which is a frequent desire of local communities.
Compliance audits have been carried out on all UK sites held by portfolio companies, confirming that they are in line with government permits and conditions. This includes new landscaping and habitat improvements. The Investment Manager is overseeing the creation of a nature reserve on the Turweston site in Northamptonshire, including the installation of beehives.
SOCIAL & COMMUNITY ENGAGEMENT
Foresight Group actively seeks to engage with the local communities around the solar assets operated by our portfolio companies and regularly attends parish meetings to encourage community engagement and promote the benefits of their solar assets.
Community payments are also made to the parish councils local to the sites in the portfolio. These support a wide range of projects benefitting the local population including helping a local football club establish new changing rooms and cleaning previously derelict land to create paving for a growing cricket club.
During the period, the Investment Manager made community contribution payments related to the Dove View site. The annual community payments for Marchington were also extended to reflect the site’s 40-year consent.
HEALTH AND SAFETY
There were no reportable health and safety incidents during the period. Safety, Health, Environment and Quality (“SHEQ”) performance and risk management are a top priority at all levels for Foresight Group. To further improve the management of SHEQ risks, reinforce best practice and ensure non-compliance with regulations is avoided, Foresight Group has appointed an independent health and safety consultant who regularly visits the portfolio assets operated by our portfolio companies to ensure they not only meet, but exceed, industry and legal standards. The consultant has confirmed that all sites are in compliance with applicable regulations. Recommendations have been implemented to help raise standards further. During the period improvements were made to security arrangements for two of the plants.
It has been another positive period for the Company with a number of attractive acquisitions completed by portfolio companies and strong performance from both new and existing assets. Plant optimisation will continue to be a core objective both from an operational perspective and in respect of their ability to support a sustainable level of debt to enhance returns to the fund. The Company will focus on embedding the UK and Italian assets acquired during the period, and continuing to deliver strong operational performance across the portfolio. During the next period, in order to provide liquidity for possible investor redemptions, some assets may be selectively sold, especially when demand for such assets remains strong. The Investment Manager is also working to negotiate new debt terms with the existing lender to refinance the majority of the UK solar assets. Pricing is materially less than the current arrangement while working with the existing lender reduces costs significantly as less additional due diligence work is required. This loan will most likely be finalised in Q3 2019.
Foresight Group CI Limited
30 July 2019
for the nine months ended 31 March 2019
|Nine months ended 31 March 2019||Year ended 30 June 2018|
|Investment holding gains||—||3,612||3,612||—||835||835|
|Realised losses on investments||—||(197)||(197)||—||—||—|
|Investment management fees||(117)||(350)||(467)||(173)||(649)||(822)|
|Loan interest payable||(311)||—||(311)||(371)||—||(371)|
|(Loss)/Profit before taxation||(256)||3,065||2,809||352||186||538|
|(Loss)/Profit after taxation||(256)||3,065||2,809||352||186||538|
|Profit per share:|
The total column of this statement is the profit and loss account of the Company and the revenue and capital columns represent supplementary information.
All revenue and capital items in the above Income Statement are derived from continuing operations. No operations were acquired or discontinued in the period.
The Company has no recognised gains or losses other than those shown above, therefore no separate statement of comprehensive income has been presented.
Reconciliation of Movements in Shareholders’ Funds
|Nine months ended 31 March 2019||Called-up share capital||Share premium account||Capital redemption reserve||Distributable reserve*||Capital reserve*||Revaluation reserve||Total|
|As at 1 July 2018||439||7,050||115||21,605||(10,299)||21,908||40,818|
|Expenses in relation to prior year share issues||—||(18)||—||—||—||—||(18)|
|Repurchase of shares||(7)||—||7||(619)||—||—||(619)|
|Realised losses on disposal of investments||—||—||—||—||(197)||—||(197)|
|Investment holding gains||—||—||—||—||—||3,612||3,612|
|Management fees charged to capital||—||—||—||—||(350)||—||(350)|
|Revenue loss for the period||—||—||—||(256)||—||—||(256)|
|As at 31 March 2019||432||7,032||122||19,426||(10,846)||25,520||41,686|
|Year ended 30 June 2018||Called-up share capital||Share premium account||Capital redemption reserve||Distributable reserve*||Capital reserve*||Revaluation reserve||Total|
|As at 1 July 2017||454||7,061||112||23,869||(9,650)||21,073||42,919|
|Expenses in relation to prior year share issues||—||(23)||—||(41)||—||—||(64)|
|Share class merger||(12)||12||—||—||—||—||—|
|Repurchase of shares||(3)||—||3||(322)||—||—||(322)|
|Investment holding gains||—||—||—||—||—||835||835|
|Management fees charged to capital||—||—||—||—||(649)||—||(649)|
|Revenue profit for the year||—||—||—||352||—||—||352|
|As at 30 June 2018||439||7,050||115||21,605||(10,299)||21,908||40,818|
*Total distributable reserves at 31 March 2019 were £8,580,000 (2018: £11,306,000).
at 31 March 2019
Registered Number: 07289280
| As at|
31 March 2019
| As at|
|Investments held at fair value through profit or loss||56,767||53,352|
|Cash and cash equivalents||2,334||4,843|
|Amounts falling due within one year||(17,820)||(2,852)|
|Net current (liabilities)/assets||(15,081)||2,466|
|Amounts falling due greater than one year||-||(15,000)|
|Capital and reserves|
|Called-up share capital||432||439|
|Capital redemption reserve||122||115|
|Equity shareholders’ funds||41,686||40,818|
|Net asset value per share|
Cash Flow Statement
for the nine months ended 31 March 2019
| Nine months|
|Cash flow from operating activities|
|Deposit and similar interest received||8||8|
|Investment management fees paid||(466)||(791)|
|Performance incentive fee paid||(130)||—|
|Secretarial fees paid||(99)||(269)|
|Other cash (payments)/receipts||(441)||107|
|Net cash outflow from operating activities||(1,128)||(945)|
|Cash flow from investing activities|
|Purchase of investments||—||(97)|
|Net proceeds on sale of investments||—||1,332|
|Investment income received||550||1,515|
|Net cash inflow from investing activities||550||2,750|
|Cash flow from financing activities|
|Expenses of fund raising||(18)||(80)|
|Repurchase of own shares||(619)||(322)|
|Equity dividends paid||(1,304)||(2,253)|
|Net cash outflow from financing activities||(1,941)||(2,655)|
|Net outflow of cash in the period||(2,519)||(850)|
|Reconciliation of net cash flow to movement in net funds|
|Decrease in cash for the period||(2,519)||(850)|
|Net cash at start of period||4,853||5,703|
|Net cash at end of period||2,334||4,853|
| Analysis of changes in net cash|
| At 1 July 2018|
| Cash flow|
| At 31 March 2019|
|Cash and cash equivalents||4,853||(2,519)||2,334|
Notes to the accounts
1. The audited Annual Financial Report has been prepared on the basis of accounting policies set out in the statutory accounts of the Company for the year ended 31 March 2019. All investments held by the Company are classified as ‘fair value through the profit and loss’. Unquoted investments have been valued in accordance with IPEVC guidelines, as updated in December 2015. Quoted investments are stated at bid prices in accordance with the IPEVC guidelines and Generally Accepted Accounting Practice.
2. These are not statutory accounts in accordance with S436 of the Companies Act 2006. The full audited accounts for the year ended 30 June 2018, which were unqualified and did not contain any statements under S498(2) or S498(3) of Companies Act 2006, will be lodged with the Registrar of Companies. Statutory accounts for the year ended 30 June 2017 including an unqualified audit report and containing no statements under the Companies Act 2006 will be delivered to the Registrar of Companies in due course.
3. Copies of the Annual Report will be sent to shareholders and will be available for inspection at the Registered Office of the Company at The Shard, 32 London Bridge Street, London, SE1 9SG and can be accessed on the following website: www.foresightgroup.eu
4. Net asset value per share
Net asset value per Ordinary Share is based on net assets at the period end of £41,686,000 (2018: £40,818,000) and on 43,247,592 Ordinary Shares (2018: 43,911,189), being the number of Ordinary Shares in issue at that date.
5. Return per share
|Nine months ended 31 March 2019||Year ended 30 June 2018|
|Total profit/(loss) after taxation||2,809||538|
|Total profit/(loss) per share (note a)||6.5p||1.2p|
|Revenue profit/(loss) from ordinary activities after taxation||(256)||352|
|Revenue profit/(loss) per share (note b)||(0.6)p||0.8p|
|Capital profit/(loss) from ordinary activities after taxation||3,065||186|
|Capital profit/(loss) per share (note c)||7.1p||0.4p|
|Weighted average number of shares in issue during the year (note d)||43,399,944||45,273,865|
a) Total profit/(loss) per share is total profit/(loss) after taxation divided by the weighted average number of shares in issue during the year.
b) Revenue profit/(loss) per share is revenue profit/(loss) after taxation divided by the weighted average number of shares in issue during the year.
c) Capital profit/(loss) per share is capital profit/(loss) after taxation divided by the weighted average number of shares in issue during the year.
d) The weighted average number of shares for the year ended 30 June 2018 has been adjusted to take account of the O, C and D share class merger on 29 June 2018.
6. The Annual General Meeting will be held at 12.30pm on 6 December 2018 at the offices of Foresight Group LLP, The Shard, 32 London Bridge Street, London, SE1 9SG.
| Nine months ended|
| Year ended|
|Loan stock interest||538||572|
8. Investments held at fair value through profit or loss
|Book cost at 1 July 2018||31,444|
|Investment holding gains||21,908|
|Valuation at 1 July 2018||53,352|
|Movements in the period:|
|Purchases at cost||—|
|Investment holding gains/(losses)||835|
|Valuation at 31 March 2019||56,767|
|Book cost at 31 March 2019||31,247|
|Investment holding gains||25,520|
|Valuation at 31 March 2019||56,767|
*Realised losses represents the removal of legal costs incurred in relation to the disposal of the FiT assets and refinancing of Turweston assets.
9. Transactions with the manager
Details of arrangements with Foresight Group LLP, Foresight Fund Managers Limited and Foresight Group CI Limited are given in the Directors’ Report and Notes 3 and 13. All arrangements and transactions were on an arms length basis.
The Company’s Investment Manager earned fees of £467,000 in the nine months ended 31 March 2019 (year ended 30 June 2018: £692,000). At the period end date, management fees due from the Manager amounted to £1,000 (2018: £2,000). The Manager also earned performance incentive fees of £nil during the period (2018: £130,000). The amount accrued in respect of performance incentive fees as at 30 June 2018 was paid to the Manager during the period.
Foresight Group LLP, to whom the Manager delegated the function of Company Secretary from November 2017, earned fees amounting to £97,000 in the nine months ended 31 March 2019 (year ended 30 June 2018: £102,000), of which £nil remained payable at the period end date (2018: £2,000).
Foresight Fund Managers Limited, the delegated Company Secretary until November 2017, earned fees of £nil during the period (2018: £100,000). No amounts were due to Foresight Fund Managers Limited at the period end date (2018: £nil).
The Manager recharged fund expenses incurred on behalf of the Company of which £28,000 (2018: £158,000) remained payable at the period end date.
Foresight Group is responsible for external costs such as legal and accounting fees, incurred on transactions that do not proceed to completion (‘abort expenses’). In line with industry practice, Foresight Group retain the right to charge arrangement and syndication fees and Directors’ or monitoring fees (‘deal fees’) to companies in which the Company invests. From this, Foresight Group received from portfolio companies arrangement fees of £291,000 in the period (2018: £nil).
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