Highlights and Insights from FY24 with Bernard Fairman and Gary Fraser

In 2007 I saw the opportunity that solar would present to the world. I saw this as the energy generation form that would, because of cost reduction, become the cheapest form of energy generation in years to come, and so it has proven since we first started investing in solar. Today, costs of installation have reduced by a massive 95%. Now, if you said that to anybody at the time, they wouldn't have believed you. How can cost of something go down by 95%? But it has. That formed part of the thought process that got us into that in the first place. Now I think we find ourselves in a situation where solar is going to be one of the backbone energy generators in the future. The other one that we see alongside it in hard-to-electrify areas, like for example aviation or shipping or green steel, is hydrogen. We see hydrogen as an important part of the energy mix going forward. So I'm particularly excited about our position front and foremost in the energy transition and our ability to deliver on the promises that we've made. We're raising money now at a significant rate that we can be an important player in that transition. Investment opportunity important because we're not just located in the UK. We've got our main office here, but we've got a big office in Australia, 60 people in Australia. We've got a significant size office in Madrid and also in Italy. I'm often asked by investors, 'Well, you know, do you see enough deals to go around?' For me, this is probably one of those really rare markets where there's probably more deals to be done than there is money to invest in them. We currently invest about $1.8 trillion in the energy transition globally. That needs to increase to $4.8 trillion by 2030, so nearly trebling in the next six years. So to achieve that, the amount of money that needs to be mobilized is enormous, and that's what creates the conviction behind stating that it's the biggest investment opportunity in anyone's generation.

So the key drivers underpinning the performance in FY24 were retail fundraising in both private equity and infrastructure, as well as institutional fundraising within the private equity part of the business. Those all contributed to a really standout year in FY24 that saw profitability grow by almost 20%. The key achievement in the past year has been our ability to grow despite really difficult macroeconomic conditions, principally a high interest rate environment. So I would say growth despite that challenging environment has been a real success for FY24 for Foresight Group. We're in a situation with interest rates beginning to come down and with the prospect of them perhaps halving over the next year or so that that market will come back quite significantly. So the Oxx will become much more attractive as an investment opportunity, and indeed we're already beginning to see flows picking up into those sectors into which we invest. One other thing to note is that in the infrastructure business, we've got about $5 billion of deals to do. We haven't yet raised the money to do those deals, but when we do, we'll be able to invest it fairly immediately. So there's plenty of deal pipeline that we've secured, we just need to secure the money to invest in it. And I think there's a lot more where that came from. I think we've got a lot of conviction in terms of the UK and Irish SMEs, but I think it's really important to be in the regions delivering on economic growth, creating jobs, and helping small businesses grow. So it's not just about conviction, it's also about doing the right thing in the regions. And we're really excited to be partnering with local government pension schemes to be able to deliver on that.

It's important for Foresight to have over 40,000 retail investors and 200 institutions delivering on our fundraising aspirations because it creates a real resilience in terms of our business model. Our ability to grow is not just restricted to one source of fundraising, so having that mix is really important to Foresight in terms of its growth going forward.

I was at a FTSE 250 conference recently and one of the analysts said to me that you must be really proud about the difference that each and every one of our employees is making trying to deliver on the energy transition and really make a difference in the regions in terms of creating jobs and growing local economies. And that really put it in context for me. When somebody from the outside looking in really appreciates the difference that Foresight and its people are making, you know, I'd really like to thank everyone in the team across all of our divisions, across all of our geographies, for the difference they're making.