Foresight Environmental Infrastructure Limited GBP · LSE:FGEN
Foresight Environmental Infrastructure Limited GBP — JLEN Environmental Assets Group — FY2023 Earnings Presentation
48 slides from Foresight Environmental Infrastructure Limited GBP's earnings presentation, Jun 15, 2023
Slide 1: Annual Results Presentation
JLEN ENVIRONMENTAL ASSETS GROUP LIMITED Annual Results Presentation = 15 June 2023
Slide 2: The Investment Manager Foresight
2 THE INVESTMENT MANAGER Foresight FOR A SMARTER FUTURE Foresight Group LLP JLEN is managed by Foresight Group LLP as its external alternative investment fund manager (“AIFM") with discretionary investment management authority for the Company. Chris Tanner Edward Mountney Chris Holmes £12.2bn” 350+?
Slide 3: Fund Overview
3 FUND OVERVIEW Because environmental infrastructure is more than just renewable energy * Broad environmental infrastructure mandate allowing exposure to a wide opportunity set * Diversified portfolio includes wind, solar, anaerobic digestion, waste facilities, wastewater treatment, bioenergy, low c
Slide 4: Results overview
Results overview
Slide 5: Performance Highlights
5 PERFORMANCE HIGHLIGHTS Demonstrating strength in the face of political and economic volatility Net Asset Value £814.6m +7% Dividend target ) 7.57p +6% Net Asset Value per share 123.1p +7% Market capitalisation £791.2m +6% Annual dividend declared per share 7.14p +5% Portfolio value £898.5m +13% Di
Slide 6: Track Record
6 TRACK RECORD Diversification is the key to risk management JLEN Net Asset Value Market capitalisation ence cn 140 1000 1254p 153 120 fe = €79L.1m 1012p 9670 1001p 9957 Gun Ga) Asam 100 92.22p. — socom £6123, --"* 80 600 eres @ 400 = 40 - 200 20 0 ° Mor 2015 Mar2046—Mar2017—« Mar 2018 Mar2019—«Mar2
Slide 7: Financial Results
FINANCIAL RESULTS Cash distributions from investments Administrative expenses (1.3) (1.4) Directors’ fees and expenses (0.3) (0.3) Investment Manager fees (8.1) (6.3) Financing costs (net of interest income) (3.4) (2.6) Cash flow from operations 70.5 46.2 Net proceeds from share issues - 115.7 Expen
Slide 8: Financial Results cont.
8 FINANCIAL RESULTS cont. Interest received 31.4 28.8 Portfolio value 898.5 795.4 Intermediate holding companies’ cash 17.9 16.0 Dividends received 23.1 21.3 Revolving credit facility (103.5) (53.6) Sub-total 54.5 504 Other assets 3.9 5.1 Net gains on investments at fair value 53.9 142.8 Fair value
Slide 9: Leverage
9 LEVERAGE Low level of gearing Technology Wind Waste & bioenergy Anaerobic digestion Solar Low carbon & sustainable solutions Controlled environment Hydro. Debt asa % of GAV Project level gearing Fund level gearing (inc. RCF) Project level debt * All long-term debt fully amortising within subsidy l
Slide 10: Portfolio valuation
10 Portfolio valuation
Slide 11: Portfolio Valuation Movement
i PORTFOLIO VALUATION MOVEMENT 15% increase over the rebased opening valuation £m 1,000 £67.7m £27.3m £1.0m £721m es77m 0 — (91m 800 7 ({£83.6m) 600 400 200 Portfolio Acquisitions Distributions Rebased Forecast Economic Discount Change in Balance Portfalio valuation at and further power assumptions
Slide 12: Power Prices
12 POWER PRICES Methodology remains unchanged Valuation methodology * Approach of using market forwards or fixes where applicable for 2 years remains unchanged * Unchanged policy of using a blended curve thereafter, adjusted for project-specific arrangements and price cannibalisation * The graph sho
Slide 13: Price Fixing Strategy
13 PRICE FIXING STRATEGY Downside protection balanced with upside potential JLEN's exposure to wholesale power prices is mitigated by the practice of having a substantial proportion of generation for both electricity and gas on fixed price arrangements for durations ranging from six months out to th
Slide 14: Discount Rates
14 DISCOUNT RATES WADR increase to 8.4% following further investment into higher return construction assets Market backdrop Valuation assumption * Risk-free rates declines quickly following the post mini-budget spike * This was followed by a period of relative stability in bond yields up to the 31st
Slide 15: Other Key Valuation Assumptions
15 OTHER KEY VALUATION ASSUMPTIONS Actual YTD 2023 inflation tracking valuation assumptions 31 March 2022 Economic assumptions UK — inflation rates 5% for 2022, then 3% until 2030 and 2.25% thereafter 31 March 2023 Economic assumptions UK — inflation rates 6.5% for 2023, then 3% until 2030 and 2.25%
Slide 16: Portfolio overview
16 Portfolio overview
Slide 17: Portfolio at a Glance
7 PORTFOLIO AT A GLANCE Core UK portfolio with a growing European reach Portfolio value split onal status Total assets split by sector @ Operational a @ Construction Total assets \ 42) Portfolio value split by geography Wind Waste & bioenergy i-3 3 3 Low carbon & sustainable solutions Controlled env
Slide 18: Portfolio Analysis
18 PORTFOLIO ANALYSIS A diversified mix of environmental assets, with low exposure to individual risk factors oncentration %1% y ze 4% 51% 12% 28% 6% 15% 6% 5% 4% 19% 26% 16% : Wi Largest asset wind ; Wi 2nd largest asset Hi waste & bioenergy Wi 3rd largest asset Anaerobic digestion Wi 4th largest a
Slide 19: Portfolio Revenue Analysis
19 PORTFOLIO REVENUE ANALYSIS Revenue evolution and inflation linkage Revenue evolution Million (GBP) 400 * The chart overleaf shows the proportion of different revenue categories on an NPV basis * Other merchant revenues include non- energy generating assets such as JLEN's controlled environment in
Slide 20: Construction Management
20 CONSTRUCTION MANAGEMENT Investment allowance of 25% into construction assets * Gradual increase in construction assets to 10% of portfolio value * JLEN sees key advantages in construction investment. These may include: * Higher entry IRRs; ¢ Discount rate compression and capital growth once in op
Slide 21: Construction Management cont.
21 CONSTRUCTION MANAGEMENT cont. Rjukan, Norway Controlled environment 8,000 tonnes of trout p.a Construction in progress H1 2025 £40m Co-located with existing AD Controlled environment 2.1 hectares Construction in progress H2 2023 £26.7m
Slide 22: Construction Progress
22 CONSTRUCTION PROGRESS Remaining commitments well covered JLEN Investment obligations <12 months: 2022 2023 2024 2025 (>) Battery Energy Storage Systems (“BESS”) * West Gourdie: £3.0m West Gourdie: 50MW lithium-ion battery based in Dundee ° Sandridge: £8.0m Acquisition Date: Construction end: Jun
Slide 23: Portfolio performance
23 Portfolio performance
Slide 24: Financial Performance
FINANCIAL PERFORMANCE Budget vs actual project distributions JLEN 120 4.9% 100% roa — 13% 0.1% 04% _ 87.9% (18.6)% 9% . Ae ao ae (Bes Highest dividend cover 60 since IPO of 1.51x 40 20 ie) Forecast Wind Waste & Anaerobic Solar Low carbon Controlled Hydro Actual project bioenergy digestion & sustaina
Slide 25: Operational Performance
OPERATIONAL PERFORMANCE Budget vs actual energy generation 100% 100 — 0.5% = = = (50) 3.21% (0.2)% 80 60 40 20 0 Forecast. Wind Waste& Anaerobic Solar. ~~ Lowccarbon Controlled Hydro portfolio bioenergy digestion & sustainable environment generation solutions JLEN 94.2% 1,325 GWh generated by the en
Slide 26: Biomethane Injection Hub Cramlington Fuel
Biomethane Injection Cramlington Fuel AD to Glasshouse Hub Preparation Area Private Wire • • • • • • • • •
Slide 27: ESG
ESG eo ee:
Slide 28: ESG at a Glance
28 ESG AT A GLANCE Article 9 Fund, with an award-winning approach to ESG erformance 1,325 GWh renewable energy generated 212,263 tonnes CO, avoided" 35.6 wastewater treated (billion litres) >347 full-time equivalent jobs supported £432,756 community funding Article 9 fund, committed to environmental
Slide 29: ESG KPIs
29 ESG KPIs Improved or stable performance on 13 out of 20 KPIs Governance Renewable energy generated Community funding Portfolio audits of health and safety practices GHG emissions avoided Health and safety incidents Diversity of SPV directors Tonnes of waste treated Community engagement procedures
Slide 30: Outlook & opportunities
30 Outlook & opportunities
Slide 31: Wind, Solar, AD, Biomass & EfW
Wind • P P • Solar • P P • • AD P • • Biomass P & EfW •
Slide 32: Controlled environment, low carbon transport, battery, hydrogen
Controlled • environment P P • Low carbon • transport P P • • Battery storage P P • Hydrogen • P P •
Slide 33: Hydrogen
Hydrogen
Slide 34: Hydrogen as Part of the Energy Transition
34 HYDROGEN AS PART OF THE ENERGY TRANSITION It provides a flexible, complementary energy medium alongside intermittent renewables Renewable energy storage Hydrogen offers low cost grid balancing by utilising excess, variable renewable energy to generate hydrogen for storage responding to peaks in d
Slide 35: The Hydrogen Value Chain & Foresight's Industrial Network
THE HYDROGEN VALUE CHAIN & FORESIGHT’S INDUSTRIAL NETWORK JLEN Foresight has a strong presence in adjacencies of the hydrogen value chain coupled with high profile industrial partnerships or collaboration The clean hydrogen value chain Renewable Power Hydrogen Distribution and End-Use Generation Syn
Slide 36: HH2E
a I-Il2E High quality assets in industrial Germany with large pipeline ©,0 pa Credible, well connected Management Team Strong pipeline of H2 projects across Germany Use of batteries to maximise electrolyser load factor Infrastructure characteristics with potential for strong returns Alex Voigt, CEO.
Slide 37: Summary
Summary
Slide 38: Summary
38 SUMMARY Disciplined diversification underpins stable return to investors * Disciplined approach to five acquisitions completed during the year, giving a total of 42 assets * Further diversification into controlled environments and green hydrogen * Outlook supports the continued build out of a res
Slide 39: Thanks for listening
it Thanks for listening TCFD »iPRI SUSTAINABLE DEVELOPMENT G&ALS Principles for Responsible Investment
Slide 40: Appendices
Appendices
Slide 41: Fund Objectives
41 FUND OBJECTIVES ESG objectives Develop positive relationships with communities in which JLEN works Promote the efficient use of Ensure effective, ethical resources To encourage positive relations ding between To inv portfolio and the in which tl natural r effective governan:
Slide 42: NAV Sensitivity Analysis at March 2023
42 NAV SENSITIVITY ANALYSIS AT 31 MARCH 2023 Sensitivities — impact on NAV at 31 March 2023 Discount rates (47-05%) (2077) TE 2.7 nd (PL07P90) _——_yT =e Wind (P10/P90) (£27.3m) £26.2m Solar (P10/P90) (£10.7m) £10.5m Energy yield: | Hydro (P10/P90) (tan) ata prices (4-108) (Ckra) ma yee ams, 1530) EE
Slide 43: Assess, Monitor, Engage
43 ASSESS, MONITOR, ENGAGE [acess Motor MM erase] JLEN JLEN undertakes due diligence on Third-party service providers, Engagement with stakeholders each of its asset acquisitions, sometimes with the assistance of occurs through a combination of including assessing a range of ESG technical advisers,
Slide 44: Board of Directors
44 BOARD OF DIRECTORS Foresight FOR A SMARTER FUTURE Ed Warner Steph Coxon Hans Joern Rieks Alan Bates Jo Harrison Nadia Sood Board Chair Senior Independent Director Director & Chair of Director & Chair of Director Director & Chair of Risk Committee ESG Committee Audit Committee Board structure as a
Slide 45: Fund Governance and Terms
45 FUND GOVERNANCE AND TERMS The Fund Alternative Investm Fund Manager Base Fee Performance Fee Asset Origination Fee Alternative Investment Fund Manager Term Discount Co Continuation Vote Domiciled in Guernsey Independent Board of Directors Premium listing on the LSE (Chapter 15) Foresight Group LL
Slide 46: Investment Policy
46 INVESTMENT POLICY JLEN The Company seeks to achieve its objectives by investing in a diversified portfolio of environmental infrastructure JLEN defines environmental infrastructure as infrastructure assets, projects and asset-backed businesses that utilise natural or waste resources or support mo
Slide 47: Contacts
47 CONTACTS JLEN is a Guernsey registered company, with its registered office at 1 Royal Plaza, Royal Avenue, St Peter Port, Guernsey GY1 2HL. Corporate broker Winterflood Securities Ltd Neil Langford The Atrium Building Cannon Bridge House 25 Dowgate Hill London EC4R 2GA United Kingdom Telephone: +
Slide 48: Disclaimer
48 DISCLAIMER This document contains information provided solely as an update on the financial condition, results of operations and business of JLEN Environmental Assets Group Limited ("JLEN"). Nothing in this document or in any accompanying management discussion of this document constitutes, nor is
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