Foresight : FY24 Report

Investing in our future.

Foresight Group Holdings Limited

Annual Report and Financial Statements

For the year ended 31 March 2024

Our values

Sustainable

Achieve with

Invest

Build

Grow

impactambition

See more on page 11

Relationships with	Collective
integrity	success

Front cover: Community Day at Skaftåsen Wind Farm, Sweden, part of Foresight's portfolio

1 Foresight Group Holdings Limited

Annual Report and Financial Statements FY24

Contents

Introduction

Highlights	1
Executive Chairman's statement	2

Introduction Strategic Report Governance Financial Statements

Highlights

Our diversi ed business model continues to deliver pro table growth.

Strategic Report

Overview	4
Business review	14
Performance and risk	43

Governance

Executive Chairman's introduction	67
Board of Directors	69
Corporate governance	71
Nomination Committee report	81
Audit & Risk Committee report	83
Remuneration Committee report	91
Directors' report	106

£12.1bn

AUM1

(31 March 2023: £12.2bn)

£59.3m

Core EBITDA pre-SBP1

(FY23: £50.2m)

£8.4bn

FUM1

(31 March 2023: £9.0bn)

42.0%

Core EBITDA pre-SBP margin1

(FY23: 42.1%)

£141.3m

Total revenue

(FY23: £119.2m)

£24.8m

Total comprehensive income

(FY23: £20.9m)

86.6%

Recurring revenue1

(FY23: 86.6%)

Financial Statements

Responsibility statement of the Directors	114
Independent Auditor's report	115
Consolidated Statement of Comprehensive Income	125
Consolidated Statement of Financial Position	127
Consolidated Statement of Changes in Equity	128
Consolidated Cash Flow Statement	129
Notes to the fi nancial statements	131
Appendices to the fi nancial statements	185
Glossary	198
Corporate information	200

foresight.group

See more in our 2024 Sustainability Report

1. Alternative performance measures ("APMs") have been included to better reflect the Group's underlying activities. Whilst appreciating that APMs are not considered to be a substitute for, or superior to, IFRS measures, the Group believes their selected use may provide stakeholders with additional information which will assist in their understanding of the business. In particular, the Group believes Core EBITDA pre-SBP reflects the trading performance of the underlying business without distortion from the uncontrollable nature of the share-based payments charge. Recurring revenues % is recurring revenue divided by total revenue.

Note: Certain data contained in this document, including fi nancial information, has been subject to rounding adjustments. As a result of this rounding, the totals of data presented in this document may vary slightly from the actual arithmetic totals of such data. In certain statistical and operating tables contained in this document, the sum of numbers in a column or a row may not conform to the total fi gure given for that column or row. Percentages in tables and elsewhere in this document may have been rounded and accordingly may not add up to 100%.

2 Foresight Group Holdings Limited

Annual Report and Financial Statements FY24

Executive Chairman's statement

Introduction Strategic Report Governance Financial Statements

"Strong earnings momentum and multiple drivers of growth"

Bernard Fairman

Executive Chairman

FY24 represented another strong year of profi table growth for the Group. We benefi ted from increasing demand for our higher margin retail vehicles (£436 million funds raised) and successful institutional fundraising activity from our Private Equity business (£134 million funds raised). The improved profi tability of our resulting FUM mix, albeit modestly down to £8.4 billion (FY23: £9.0 billion), delivered growth in core EBITDA pre-SBP of 18% for the Group and further builds upon the substantial progress that we have made since IPO.

Three years post-IPO

In February 2021, we successfully listed Foresight Group on the London Stock Exchange with two key objectives:

1. Further enhance the Group's profi le in order to strengthen fundraising delivery
2. Utilise the Group's shares as an additional source of capital to fund M&A activity

The fi rst of these IPO objectives has been an overwhelming success.

Fundraising into higher margin retail and private equity institutional vehicles has increased by c.65% and c.120% respectively post-listing1, when compared with the three years prior².

In institutional infrastructure fundraising, our flagship energy transition strategy, Foresight Energy Infrastructure Partners ("FEIP"), closed with total commitments of €851 million in 2021, which was c.70% over the original target. Building upon this success, post period end we secured commitments of €300 million for the fi rst close of FEIP II, the second vintage of this strategy. This demonstrates the quality and demand for our flagship energy transition strategy and I have every confi dence in our team's ability to achieve at least our target fundraise of €1.25 billion during 2025, a material increase on the fi rst vintage and an important step in scaling our platform.

1. Defi ned as FY22, FY23 and FY24.

We also delivered early success in relation to our second IPO objective through the signifi cant acquisition of Australia-based Infrastructure Capital Holdings Pty Ltd ("Infrastructure Capital"). This transaction has not only been fi nancially and strategically accretive but has also substantially increased our geographic reach.

In summary, in our fi rst three years as a listed company, including FY24 most recently, the Group has achieved signifi cant growth across AUM (+69%), core EBITDA pre-SBP (+148%) and broadened our geographic presence, with non-UK asset exposure having increased from 22% to 46%. The Group has also delivered substantial margin expansion of +7.4ppts and is well positioned to realise further operating leverage as the business scales.

I fi rmly believe that the foundations we have built as a listed company ideally positions us to capture the long-term structural growth trends in our key markets.

Outlook within our key markets

As an international investment manager, we provide investors access to attractive opportunities in the transition to cleaner energy, decarbonised infrastructure and the economic potential of growing companies. Our extensive track record of identifying and then maximising the value of attractive investment opportunities means that we are well positioned to attract and deliver strong returns for institutional and retail investors within our key markets.

Energy transition: As I have said before, I believe that the energy transition represents the largest investment opportunity of our generation. This opportunity is driven

by long-term structural and regulatory tailwinds arising from global decarbonisation agendas, energy security concerns in light of recent global conflicts and the increasing electricity consumption requirements of AI and data centres.

2. Defi ned as FY18, FY19 and FY20, with FY21 excluded due to the impact of COVID-19 on fundraising.

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Foresight Group Holdings Limited

Introduction

Strategic Report

Governance

Financial Statements

Annual Report and Financial Statements FY24

Executive Chairman's statement continued

Outlook within our key markets continued

To quantify the size of this opportunity, global investment in the energy transition reached a record $1.8 trillion in 2023, a 17% increase on 2022. Looking ahead, global investment levels are estimated to need to nearly triple to $4.8 trillion per year between 2024 and 2030 to remain on track to achieve global net zero targets1.

To address this signifi cant investment requirement, we plan to roll out multi vintages across a number of our institutional infrastructure strategies. This includes our flagship energy transition strategy, Foresight Energy Infrastructure Partners ("FEIP"), which successfully reached fi rst close of its second vintage post period end. In addition, another established strategy, Australian Renewables Income Fund ("ARIF"), remains open to further fundraising. Finally, we have a Hydrogen strategy in pre marketing and also plan to leverage our experience in Natural Capital investment to develop a private fund in this growing sector.

Regional private equity: As is the case with many countries, the UK and Ireland Small and Medium-sized Enterprise ("SME") funding markets are structurally underserved. With an estimated £15 billion equity capital gap in the UK alone2, we see this as a unique opportunity to provide much needed investment, and as such, Foresight's Private Equity division remains one of the most active SME investors.

To address the equity gap, the division's strategy provides multiple fundraising avenues across the UK and Ireland, with our retail Venture Capital Trusts ("VCTs") providing steady inflows and our regional institutional funds providing larger fundraising opportunities.

Our hard-to-replicate regional network then enables us to access high quality SME investment opportunities, with our experience through economic cycles helping to support our diverse portfolio through prevailing market conditions.

1. Per the Bloomberg NEF "Energy Transition Investment Trends 2024" report published on 30 January 2024.
2. Source: The Scale-Up Institute.

The SME equity gap is also not unique to the UK and Ireland, presenting an opportunity for our division to further expand outside of these countries in the future.

Foresight's considerable investment experience, combined with our range of compelling products within our key markets, gives me confi dence that our diversifi ed business model will continue to deliver strong profi table growth into FY25 and beyond.

Updating our guidance

Following three years of strong delivery against the targets that we set out at IPO, we believe that it is now appropriate to update our medium-term guidance. Looking forward, our focus will continue to be on delivering profi table growth with the aim of doubling core EBITDA pre-SBP in the fi ve years to the end of FY29.

This aim will be achieved by growing our real asset and regional private equity focused strategies, as well as our tax efficient products. Our expertise and capabilities in these areas, combined with the structural growth trends in these markets that I have already outlined, give me full confi dence in our ability to meet or exceed this guidance organically.

Strategic M&A will remain an important part of our overall strategy and provides an opportunity for outperformance. We will continue to apply a disciplined approach in our assessment of these opportunities, pursuing only those that are earnings accretive.

In addition to our headline guidance, we will:

• target 85-90% recurring revenue
• expand core EBITDA pre-SBP margin as the business scales
• payout 60% of profi t after tax before non-underlying items, as part of a clear approach to capital allocation

Governance and Sustainability

Growth has clearly been a key focus for the Group but strong governance is critical to our success. In addition to the Governance section within this report we have produced a separate Sustainability Report for the second successive year. Please refer to this document for details on our approach to sustainability including the independent double materiality assessment we completed in FY24 to ensure that we comply and thrive within an evolving regulatory backdrop.

Dividend

To reflect the signifi cant increase in core EBITDA pre-SBP delivered by the Group this year, and the continued strong levels of cash generation the Board is recommending a fi nal dividend of 15.5 pence per share to match the prior year (2023: 15.5 pence per share) for approval by Shareholders at the upcoming AGM. When combined with our interim dividend of 6.7 pence per share (H1 FY23: 4.6 pence per share) this gives a total dividend payment for the year of

22.2 pence per share, representing a 10% increase on prior year (2023: 20.1 pence per share). The fi nal dividend will be paid on 4 October 2024 based on an ex-dividend date of 19 September 2024, with a record date of

20 September 2024.

On behalf of the Board, I would like to thank all our colleagues across the globe for their valuable contributions to the success of the Group and for their continued dedication as we enter FY25.

Bernard Fairman

Executive Chairman

26 June 2024

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Foresight Group Holdings Limited

Strategic Report

Annual Report and Financial Statements FY24

Strategic Report

Building successful investment strategies.

Overview

About us	5
Business model	10
Strategic priorities	11
Key performance indicators	12

Manfredonia, Italy, an energy-from-waste plant. Part of Foresight's and JLEN's portfolios

5 Foresight Group Holdings Limited

Annual Report and Financial Statements FY24

About us

Founded in 1984, Foresight is a leading investment manager in real assets and capital for growth.

We invest in building cleaner energy systems, decarbonising industry and growing the economic potential of ambitious companies.

Across our three divisions, Infrastructure, Private Equity and Foresight Capital Management, our investments play an important role in reducing the world's carbon emissions, improving social infrastructure for businesses and communities, and supporting the long-term growth of ambitious companies.

Foresight's decades of investment experience and hands-on approach help us create and maximise overall value and provide attractive returns to our diverse institutional and retail investor base across a broad range of fund strategies and investment structures. This diversifi ed business model and strong track record of innovating products, scaling investment funds and delivering profi table growth have demonstrated resilience, efficiency and strong fi nancial performance through economic cycles.

Together, we are united by a shared commitment to build a sustainable future and grow thriving economies.

Strategic Report

Plug planting at solar site to celebrate the launch of Foresight's Nature Recovery Blueprint in Cornwall

6 Foresight Group Holdings Limited

Annual Report and Financial Statements FY24

About us continued

Introduction

Strategic Report

Governance

Financial Statements

Profi table

Demonstrable track record of profi table growth

+148%

Increase in core EBITDA pre-SBP since IPO

+7.4ppt

Margin expansion since IPO, evidencing operating leverage

Growing markets

Ideally positioned to capture the long-term structural growth trends in our key markets

Global investment levels are forecast to need to nearly triple to $4.8 trillion per year between 2024 and 2030 to remain on track to achieve global net zero targets1

£15 billion² equity capital gap for SMEs in the UK alone

Sustainable

Foresight has over 80% of our AUM in investments that are aligned with the Multilateral Development Banks' list of activities considered universally aligned with the Paris Agreement's mitigation goals3

The Sustainability Report also sets out the process and results of the double materiality analysis conducted in FY24. To be well-prepared for future market demands, the double materiality analysis is based on both the International Sustainability Standards Board ("ISSB") as well as the European Sustainability Reporting Standards ("ESRS")

Foresight's Task Force on Climate-related Financial Disclosure ("TCFD") can be found in our Sustainability Report (https://www.foresight.group/sustainability-report-fy24)

1. Per the Bloomberg NEF "Energy Transition Investment Trends 2024" report published on 30 January 2024.
2. Source: The Scale-Up Institute.
3. https://documents.worldbank.org/en/publication/documents-reports/documentdetail/099212406162322091/

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Foresight Group Holdings Limited

Introduction

Strategic Report

Governance

Financial Statements

Annual Report and Financial Statements FY24

About us continued

Scalable	Diversifi ed	Predictable
Scalable growth platform	Diversifi ed and resilient business model with growing	Recurring and predictable long-term revenue model
	geographic footprint

+69%	>200	c.40,000	85-90%
Increase in AUM since IPO	Institutional investors	Retail investors	Recurring revenue range
+104%	69%	31%	92%
Increase in revenue since IPO	Institutional AUM	Retail AUM
+19%	45	46%	AUM in evergreen1 or LP vehicles, with long-duration capital
increase in revenue in FY24	Investment vehicles	Non-UK AUM

All underpinned by our entrepreneurial culture and the wealth of knowledge and experience of our people

1. Evergreen funds include listed investment trusts and are defi ned as having no pre-determined end of life and therefore have the capability to raise future capital.

8 Foresight Group Holdings Limited

Annual Report and Financial Statements FY24

About us continued

Our team, development and inclusion

We recognise that our people are the cornerstone of our continued success, holding invaluable knowledge and crucial client relationships.

Our People & Sustainable Culture ("PSC") Team sets the people strategy and frameworks to align with that of the organisation's key objectives of growth and diversifi cation. The ultimate aim is to cultivate an environment where employees can thrive professionally, making signifi cant contributions to the organisation's success.

We have a highly engaged workforce, as demonstrated by our annual engagement score of 81%. However, we recognise the loss of our top talent would not only disrupt operations, but also incur signifi cant time and expense in fi nding replacements. We have therefore committed to nurturing our talent pool to provide ample opportunities for advancement to the highest grades within Foresight Group. Our internal talent mapping and succession planning processes are instrumental in maintaining a resilient workforce, thereby minimising disruptions in the event of senior staff turnover.

Effective recruitment is crucial for Foresight Group. We focus on building a team structure with well-defi ned roles and responsibilities to ensure smooth operations. We are dedicated to attracting talent that aligns with our Diversity, Equity and Inclusion ("DE&I") goals and ensures a positive workplace culture. The risk of a poorly selected workforce can manifest in the short term, potentially leading to an inability to meet business objectives, loss of investor confi dence and missed opportunities. To mitigate these risks, we have unconscious bias training for all hiring managers, as well as ensuring our recruitment agencies are fully aware of our culture and our DE&I strategy.

Introduction

Over the course of FY25 we will be sharing inclusive line manager training, and training around neurodiversity. By focusing on these areas, we can build a diverse and talented workforce well positioned to drive long-term success.

We also recognise the importance of offering competitive compensation packages to attract, retain and motivate top talent. We conduct regular benchmarking exercises to ensure our total compensation packages, including base salary, short-term incentives and long-term incentives, remain competitive.

We operate a UK Share Incentive Plan ("SIP") Scheme for all Pay As You Earn ("PAYE") employees and have a phantom SIP Scheme to mirror this for our other European and Australian employees. These schemes ensure increased engagement and alignment of interests in terms of long-term success and growth. We also utilise retention bonuses and a comprehensive benefi ts package to further enhance the employee value propositions.

Development

Our commitment to a skilled workforce extends beyond the fi nancial and reputational risks associated with lack of training and competencies. In the short term, neglecting training could disincentivise and disengage employees.

By not investing in our employees, we could in turn damage our employer brand, making it difficult to attract and retain top talent. However, by investing in comprehensive training programmes that address both on-the-job specifi c skills and DE&I competencies, we can cultivate a highly skilled and engaged workforce. Furthermore, by training our employees in sustainability and creating a robust competence base, we can demonstrate a genuine commitment to sustainability and thereby avoid risk of greenwashing. In addition to avoiding risks, our internal training strategy encourages innovation and puts us in a better position to become a market leader.

Strategic Report Governance Financial Statements

61% of employees

enrolled on the Share Incentive Plan

Launched

Elevate - Women in

Leadership Programme

Launched

Foresight

Group secondment programme

Launched

Bespoke line manager training

Internal ACE mentoring scheme with 30% of employee base engaged