Foresight Solar VCT PLC : Annual Financial Report

FORESIGHT SOLAR VCT PLC

Summary Financial Highlights

· Net asset value per Ordinary Share at 30 June 2015 was 109.9p after payments of 6.0p in dividends (30

June 2014: 101.9p).

· Net asset value per C Share at 30 June 2015 was 91.7p after payments of 5.0p in dividends (30 June

2014: 98.0p).

· Total net asset value return (including dividends paid since launch) at 30 June 2015 is 126.9p for the

Ordinary Shares fund and 96.7p for the C Shares fund.

Ordinary Shares Fund

· Two interim dividends of 3.0p per Ordinary Share were paid on 14 November 2014 and 10 April 2015.

· An interim dividend of 3.0p per Ordinary Share will be paid on 13 November 2015 based on an ex-dividend date of 29 October 2015 and a record date of 30 October 2015.

· Six investee companies acquired assets during the year totalling £19.3 million.

C Shares Fund

· Two interim dividends of 2.5p per C Share were paid on 14 November 2014 and 10 April 2015.

· An interim dividend of 2.5p per C Share will be paid on 13 November 2015 based on an ex-dividend date of 29 October 2015 and a record date of 30 October 2015.

· Two new investments were made during the year totalling £6.0 million.

Dividend History

Ordinary Shares	Dividend per share
10 April 2015 14 November 2014	3.0p 3.0p
4 April 2014	3.0p
25 October 2013	3.0p
12 April 2013	2.5p
31 October 2012	2.5p

C Shares	Dividend per share
10 April 2015 14 November 2014	2.5p 2.5p

Chairman's Statement

Introduction

During the last 12 months there has been a significant strategic shift in the UK Government's policies with respect to renewable energy investment. This is the result of the rapid growth in renewables over recent years and a concern about the long term financial cost to consumers in terms of higher electricity bills. Fortunately, as an established owner of solar assets these changes are not expected to have a material detrimental effect on our portfolio of businesses. Indeed it could be argued it has created some rarity value, especially if in the longer term, inflation and power prices begin to rise again.

Performance - Ordinary Shares Fund

The underlying net asset value increased by 14.0p per Ordinary Share before deducting the 6.0p per Ordinary share dividend paid during the year.

The valuation of the UK portfolio increased by approximately £5.9 million (15.2p per Ordinary Share). This increase in valuation was driven by a variety of factors including further tightening of discount rates reflecting recent market conditions. The Turweston purchase finalises the reinvestment of our cash balances arising from the bond refinancing executed in 2013 and will usefully improve cash flows in the portfolio.

Following a period of relative inactivity in the Spanish and Italian solar markets, largely caused by retrospective legislation on feed-in tariffs and/or taxation, Foresight has started to see both secondary market interest in our underlying assets in these geographies and opportunities for restructuring the debt component of the transactions. At the same time we continue to pursue international arbitration proceedings against the government of Spain for breaching the protections available under the Energy Charter Treaty and international law in order to remedy our losses. The Spanish and Italian assets account for circa 10% of the ordinary share portfolio.

The overall performance of the Ordinary Shares fund remains robust and the total return since inception as at 30 June 2015 was 126.9p per Ordinary Share. Following the acquisition of the Turweston investment noted above, the Board and the Manager expects returns to be enhanced restoring progress (after providing against the Spanish and Italian asset) towards the fund's original target of a total 5 year return of 130.0p per Ordinary Share.

Ordinary Shareholder Individual Roll-Over Option

As noted in the original prospectus, the Board undertook to write to Shareholders with respect to their individual roll-over option choices which was envisaged to be in June 2015, four years after the original offer closed in June 2011. As the offer was eventually extended until November 2011, shareholders were notified in an RNS that this period has been extended by a few months. In line with their original intention the Board is now preparing a separate declaration for Shareholders to complete and return in respect of their anticipated preference to either sell or hold their shares once their minimum five year holding period has expired. The Board intend to circulate this declaration during the first half of 2016.

i. Movement in Net Asset Value of the Ordinary Shares Fund

During the period, the net asset value of the Ordinary Shares fund increased to 109.9p per share (£42.1 million) at 30 June 2015 from 101.9p per share (£39.1 million) at 30 June 2014. The main reason behind the rise in net assets was the aggregate performance of the investment portfolio increasing by 14.4p, offset by a dividend payment of 6.0p per Ordinary Share and income less expenses of 0.4p. This is summarised further in the table below:

	£'000	Pence per Ordinary Share
NAV at 30 June 2014	39,055	101.9
Dividends paid	(2,300)	(6.0)
UK investments valuation increase	5,683	15.1
Italian investments valuation decrease	(172)	(0.4)
Spanish investments valuation decrease	(174)	(0.3)
Other	(161)	(0.4)
NAV at 30 June 2015	42,111	109.9

ii. Cash & Deal Flow

During the year the Ordinary Shares fund invested £19.3 million in the Turweston asset.

The Ordinary Shares fund had cash and liquid resources of £0.1 million at 30 June 2015. 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.

iii. Investment Gains & Losses

There were no realised gains or losses during the period for the Ordinary Shares fund.

During the period the Ordinary Shares fund recognised unrealised gains of £5.5 million. Further information regarding the breakdown of this amount is contained in the Manager's Report.

iv. Running Costs

The annual management fee of the Ordinary Shares fund is 1.5%. During the period the management fees totalled £608,000, of which £152,000 was charged to the revenue account and £456,000 was charged to the capital account. At 2.1% the total expense ratio of the Ordinary Shares fund for the year to 30 June 2015 compares very favourably with its VCT peer group.

v. Ordinary Share Dividends

The Board originally planned to pay dividends of 5.0p per Ordinary Share each year throughout the life of Foresight Solar VCT plc after the first year, payable bi-annually via dividends of 2.5p per Ordinary Share in April and October each year. The level of dividends is not, however, guaranteed.

The Board is pleased to announce that the next interim dividend, of 3.0p per Ordinary Share, will be paid on 13 November 2015. The dividend has an ex-dividend date of 29 October 2015 and a record date of 30 October 2015. This exceeds the first part of the annual target dividend for 2015/16 which was set at 2.5p.

vi. Ordinary Share Issues & Buybacks

During the period under review, 15,000 Ordinary Shares were repurchased for cancellation. No new shares were issued.

Performance - C Shares Fund

i. Movement in Net Asset Value of the C Shares Fund

During the period, the net assets of the C Shares fund decreased to 91.7p per share (£11.5 million), largely due to the payment of dividends.

This is summarised further in the table below:

	£'000	Pence per C share
NAV at 30 June 2014	12,257	98.0
Dividends paid UK investments valuation increase	(625) 8	(5.0) (0.0)
Other	(163)	(1.3)
NAV at 30 June 2015	11,477	91.7

ii. Cash & Deal Flow

During the period, the C share class invested £4.0 million in the Saron project and £2.0m in the New Kaine project. In addition a loan of £1.8m was made in a solar investment in Colorado in the USA. This was repaid on 13 February 2015 and earned interest of £79k at the rate of 8.5% during the period of the loan. More information on this investment is given in the Investment Manager`s report. At 30 June 2015 the C Share fund had cash or near cash resources of £1.1 million. In addition £94,000 cash was held in portfolio companies awaiting investment.

iii. Investment Gains & Losses

There were no realised gains or losses during the year.

During the period the C Shares fund recognised unrealised gains of £8,000. Further information regarding the breakdown of this amount is contained in the Manager's Report.

iv. Running Costs

The annual management fee of the C Shares fund is 1.75%. During the period the management fees totalled £213,000, of which £53,000 was charged to the revenue account and £160,000 was charged to the capital account. The total expense ratio of the C Shares fund, for the year ended 30 June 2015 was 3.2%.

v. C Share Dividends

The Board is pleased to announce that the next interim dividend, of 2.5p per C Share, will be paid on 13 November 2015. The dividend has an ex-dividend date of 29 October 2015 and a record date of 30 October 2015. This forms the first part of the annual target dividend for 2015/16.

vi. C Shares Issue & Buybacks

During the period under review there were no C shares issued or repurchased for cancellation.

Outlook - C Shares Fund

The proceeds of the C Share offer have been fully allocated to new projects currently being completed. Further details on these investments and their underlying performance will be provided when they have completed over the next few months.

Annual General Meeting

The Company's Annual General Meeting will take place on 15 December 2015 at 1pm. I look forward to welcoming you to the Meeting, which will be held at the offices of Foresight Group in London. Details can be found on page 54.

VCT legislation

The Budget in March this year announced that some further amendments would be introduced to the VCT legislation, most of which were specifically aimed at enabling the scheme to maintain approval under the European Commission's State Aid guidelines.

The key aspects of the proposed new rules are as follows:

· Introducing an 'age of company' restriction of a maximum of seven years at the time of first investment;

· Introducing a lifetime investment limit of £12 million; and

· Prohibiting VCT investment to finance share acquisitions as well as the acquisition of trades.

These proposals are expected to apply to investments made by VCTs from November 2015 and therefore are not expected to affect the present portfolio.

Government Solar Subsidies

On 8 July 2015, the Chancellor announced the removal of the climate change levy exemption for electricity from renewable sources from 1 August 2015. The effect of this will be to reduce the holding value of our existing investments by circa 3% which, in accordance with accounting principles, is not reflected in the valuations in this report but will be in future reports.

Overall Company Outlook

During the past 2 years there have been significant changes in both the UK Government's attitude to the development of photovoltaic solar and also in the VCT regulatory environment within which we operate. The consequence of these developments is that we expect our future investment in new solar plants to be limited to concluding projects for the 'C' share class. Our principal operational activity in solar will therefore be concentrated on improving the efficiency of our existing asset base. In addition, we have also been investigating new opportunities for investments in businesses in the energy industry more broadly, particularly where there are synergies with our present operations.

Being early adopters in the field of solar investment we have benefited during the past four years from an increase in NAV driven in part by a reduction in the discount rate applied in the valuation of our assets. We are confident we have built a valuable portfolio and therefore are hopeful that in spite of the problems we have encountered with our European operations, we will achieve something close to the returns targeted in our original prospectus for both share classes.

David Hurst-Brown

Chairman

22 October 2015

Strategic Report

Introduction

This Strategic Report, on pages 5 to 9, has been prepared in accordance with the requirements of Section 414 of the Companies Act 2006 and best practice. Its purpose is to inform the members of the Company and help them to assess how the Directors have performed their duty to promote the success of the Company, in accordance with Section 172 of the Companies Act 2006.

Foresight Solar VCT plc Ordinary Shares Fund

Foresight Solar VCT plc originally raised £37.8 million through an Ordinary Share issue in 2010/2011 and 2011/2012. This fund currently has investments and assets totalling £42.2 million. The number of Ordinary Shares in issue at 30 June 2015 was 38,316,956.

Foresight Solar VCT plc C Shares Fund

In 2013/2014 and 2014/2015, £13.1 million was raised for the C Shares fund. This fund currently has investments and assets totalling £11.5 million. The number of C shares in issue at 30 June 2015 was 12,511,089.

Summary of the Investment Policy

Foresight Solar VCT plc will invest mainly in unquoted companies that generate electricity from solar power systems and benefit from long-term government-related price guarantees.

Investment Objectives

Ordinary Shares Fund

The key objective of the Ordinary Shares fund is to distribute 130.0p per share, through a combination of tax-free income, buy-backs and tender offers before the sixth anniversary of the closing date of the offer.

C Shares Fund

The key objective of the C Shares fund is to distribute 120.0p per share, through a combination of tax-free income, buy-backs and tender offers before the sixth anniversary of the closing date of the offer.

Performance and Key Performance Indicators (KPIs)

The Board expects the Manager to deliver a performance which meets the objectives of the two classes of shares. The KPIs covering these objectives are net asset value performance and dividends paid, which, when combined, give net asset value total return. Additional key performance indicators reviewed by the Board include the discount of the share price relative to the net asset value and total expenses as a proportion of shareholders' funds.

A record of some of these indicators is contained below and on the following page. The total expense ratio in the period was 2.3% and the average discount at which shares were repurchased in the market was 3.4%. The level of these KPIs compare favourably with the wider VCT marketplace based on independently published information.

A review of the Company's performance during the financial year, is contained within the Manager's Report. The Board assesses the performance of the Manager in meeting the Company's objective against the primary KPIs highlighted above.

	30 June 2015		30 June 2014
	Ordinary Shares	C Shares	Ordinary Shares	C Shares
Net asset value per share	109.9p	91.7p	101.9p	98.0p
Net asset value total return	126.9p	96.7p	112.9p	98.0p
	Ordinary Shares	C Shares	Ordinary Shares	C Shares
Share price	102.5p	93.5p	107.5p	100.0p
Share price total return	119.5p	98.5p	118.5p	100.0p
	Ordinary Shares	C Shares	Ordinary Shares	C Shares
Dividends paid from inception	17.0p	5.0p	11.0p	0.0p
Dividends paid in the year	6.0p	5.0p	6.0p	0.0p
Dividend yield %	5.9	5.3	5.6	-

Ordinary Shares Fund
Share price premium to NAV at 30 June 2015	6.7%
Average discount on buybacks	0.7%
Shares bought back during the year under review	15,000
Decrease in net asset value during year (after adding back 6.0p dividend)	13.7%
Total expense ratio	2.1%

C Shares Fund
Share price premium to NAV at 30 June 2015	2.0%
Average discount on buybacks	-
Shares bought back during the year under review	-
Decrease in net asset value during year (after adding back 5.0p dividend)	1.3%
Total expense ratio	3.2%

Strategies for achieving objectives

Investment Policy

Foresight Solar VCT plc will invest mainly in unquoted companies that generate electricity from solar power systems and benefit from long-term government-related price guarantees.

Investment securities

The Company invests in a range of securities including, but not limited to, ordinary and preference shares, loan stock, convertible securities, and fixed-interest securities as well as cash. Unquoted investments are usually structured as a combination of ordinary shares and loan stock. Non Qualifying Investments may include holdings in money market instruments, short-dated bonds, unit trusts, OEICs, structured products, guarantees to banks or third parties providing loans or other investment to investee companies and other assets where Foresight Group believes that the risk/return portfolio is consistent with the overall investment objectives of the portfolio.

UK companies

Investments are primarily made in companies which are substantially based in the UK. The companies in which investments are made must have no more than £15 million of gross assets at the time of investment for funds raised after 6 April 2012 (or £7 million if the funds being invested were raised after 5 April 2006 but before 6 April 2012) to be classed as a VCT qualifying holding.

Asset mix

The Company invests in unquoted companies that seek to generate solar electricity and benefit from long-term government-backed price guarantees. Investments may be made in companies seeking to generate renewable energy from other sources provided that these benefit from similar long-term government-backed price guarantees. No investments of this nature have been made to date. The Board has ensured that at least 70% of net funds raised under the Offer have been invested in companies whose primary business is the generation of solar electricity. Any uninvested funds are held in cash, interest bearing securities or other investments.

Risk diversification and maximum exposures

Risk is spread by investing in a number of different companies and by targeting a variety of separate locations for the solar power assets. The maximum amount invested by the Company in any one company is limited to 15% of the portfolio at the time of investment. The value of an investment is expected to increase over time as a result of trading progress and a continuous assessment is made of its suitability for sale. Solar projects can in aggregate exceed this limit but suitable structures are put in place so that individual corporate investments do not. Although risk is spread across different companies, concentration risk is fairly high, given that a significant portion are all UK Solar projects.

Borrowing powers

The Company's Articles permit borrowing, to give a degree of investment flexibility. The Board's current policy is not to use borrowing. In any event, under the Company's Articles no money may be borrowed without the sanction of an ordinary resolution if the principal amount outstanding of all borrowings by the Company and its subsidiary undertakings (if any), then exceeds, or would as a result of such borrowing exceed, a principal amount equal to the aggregate of the share capital and consolidated reserves of the Company and each of its subsidiary undertakings as shown in the audited consolidated balance sheet. The underlying portfolio companies in which Foresight Solar VCT plc invests may utilise bank borrowing or other debt arrangements to finance asset purchases but such borrowing would be non-recourse to Foresight Solar VCT plc.

VCT regulation

The investment policy is designed to ensure that the Company continues to qualify and is approved as a VCT by HM Revenue & Customs. Amongst other conditions, the Company may not invest in a single company more than 15% of its gross assets at the time of making any investment and must have at least 70% by value of its investments throughout the period in shares or securities in qualifying holdings, of which the specified percentage by value in aggregate must be in ordinary shares which carry no preferential rights (although only 10% of any individual investment needs to be in the ordinary shares of that Company). In respect of capital raised before 6 April 2011 the specified percentage was 30% and in respect of capital raised on or after April 2011 the specified percentage was 70%.

Management

The Board has engaged Foresight Group as discretionary investment manager. Foresight Fund Managers Limited also provides or procures the provision of company secretarial, administration and custodian services to the Company.

Foresight Fund Managers Limited is the secretary of the Company.

Foresight Group prefers to take a lead role in the companies in which it invests. Larger investments may be syndicated with other investing institutions, or strategic partners with similar investment criteria.

A review of the investment portfolio and of market conditions during the year is included within the Manager's Report.

Environmental, Human Rights, Employee, Social and Community Issues

The Company's investments have been made in clean energy and environmental infrastructure projects which have clear environmental benefits.

The Board recognises the requirement under Section 414 of the Act to provide information about environmental matters (including the impact of the Company's business on the environment), employee, human rights, social and community issues; including information about any policies it has in relation to these matters and effectiveness of these policies. As the Company has no employees or policies in these matters this requirement does not apply.

Gender diversity

The Board currently comprises three male Directors. The Board is, however, conscious of the need for diversity and will consider both male and female candidates when appointing new Directors.

The Manager has an equal opportunities policy and currently employs 63 men and 41 women.

Dividend policy

The Board plans to pay dividends of 5.0p per share each year throughout the life of Foresight Solar VCT plc after the first year, payable bi-annually via dividends of 2.5p per share in April and October each year. The level of dividends is not however, guaranteed.

Purchase of own shares

It is the Company's policy, subject to adequate cash availability, to consider repurchasing shares when they become available in order to help provide liquidity to the market in the Company's shares.

Principal risks, risk management and regulatory environment

The Board believes that the principal risks faced by the Company are:

· Economic - events such as an economic recession and movement in interest rates could affect performance and valuations.

· Loss of approval as a Venture Capital Trust - the Company must comply with Section 274 of the Income Tax Act 2007 which allows it to be exempted from capital gains tax on investment gains. Any breach of these rules may lead to: the Company losing its approval as a VCT; qualifying shareholders who have not held their shares for the designated holding period having to repay the income tax relief they obtained; and future dividends paid by the Company becoming subject to tax. The Company would also lose its exemption from corporation tax on capital gains.

· Investment and strategic - inappropriate strategy, poor asset allocation or consistent weak stock selection might lead to under performance and poor returns to shareholders. Changes in the rates of Feed-in Tariffs (FiTs) or Renewable Obligation Certificates (ROCs) could impact the underlying returns of the Company's investments.

· Regulatory - the Company is required to comply with the Companies Act 2006, the rules of the UK Listing Authority and United Kingdom Accounting Standards. Breach of any of these might lead to suspension of the Company's Stock Exchange listing, financial penalties or a qualified audit report.

· Natural disasters - severe weather/natural disaster could lead to reduction in performance and value of the assets.

· Reputational - inadequate or failed controls might result in breaches of regulations or loss of shareholder trust.

· Operational - failure of the Manager's accounting systems or disruption to its business might lead to an inability to provide accurate reporting and monitoring.

· Fraud - inadequate controls might lead to misappropriation of assets.

· Theft - inadequate security and control could lead to the theft of assets.

· Financial - inappropriate accounting policies might lead to misreporting or breaches of regulations. Additional financial risks, including interest rate, credit, market price and currency, are detailed in note 15 of the financial statements.

· Market risk - investment in unquoted companies by its nature involves a higher degree of risk than investment in companies traded on the main market. In particular, smaller companies often have limited product lines, markets or financial resources and may be dependent for their management on a smaller number of key individuals. In addition, the market for stock in smaller companies is often less liquid than that for stock in larger companies, bringing with it potential difficulties in acquiring, valuing and disposing of such stock.

· Liquidity - the Company's investments, being unquoted, may be difficult to realise.

· Currency risk - short-term currency risk, such as that associated with the investments in Spain and Italy, is mitigated by taking out options that convert the capital investment proceeds back into sterling at the same rate as the original sterling investment was converted into Euros when making the original investment. This ensures no currency loss on the investment up to original cost. The cost of the option is covered by the returns on the investment.

The Board seeks to mitigate the internal risks by setting policy, regular review of performance, enforcement of contractual obligations and monitoring progress and compliance. In the mitigation and management of these risks, the Board applies the principles detailed in the UK Corporate Governance Code. Details of the Company's internal controls are contained in the Corporate Governance and Internal Control sections.

Performance-related incentives

Ordinary Shares fund

After distributions of 100.0p per Ordinary Share issued under the Offer and remaining in issue at the date of calculation have been paid to Ordinary shareholders of the Company, Foresight Group will become entitled to a performance incentive which will be calculated at the rate of 20% of distributions in excess of 100.0p until total distributions reach 130.0p per share and 30% above that level.

C Shares fund

After distributions of 100.0p per C Share issued under the Offer and remaining in issue at the date of calculation have been paid to C shareholders by the Company, Foresight will become entitled to a performance incentive which will be calculated at the rate of 20% of distributions in excess of 100.0p per C Share until total distributions reach 120.0p, and 30% above that level.

Valuation Policy

Investments held by the Company have been valued in accordance with the International Private Equity and Venture Capital Valuation ("IPEVCV") guidelines (December 2012) developed by the British Venture Capital Association and other organisations. Through these guidelines, investments are valued as defined at 'fair value'. Ordinarily, unquoted investments will be valued at cost for a limited period following the date of acquisition, being the most suitable approximation of fair value unless there is an impairment or significant accretion in value during the period. The portfolio valuations are prepared by

Foresight Group, reviewed and approved by the Board quarterly and subject to review by the auditors annually.

A broad range of assumptions are used in our valuation models. These assumptions are based on long-term forecasts and are not affected by short-term fluctuations in inputs, be it economic or technical. Under the normal course of events, we would expect asset valuations to reduce each period due to the finite nature of the cash flows.

VCT Tax Benefit for Shareholders

To obtain VCT tax reliefs on subscriptions up to £200,000 per annum, a VCT investor must be a 'qualifying' individual over the age of 18 with

UK taxable income. The tax reliefs for subscriptions since 6 April 2006 are:

· Income tax relief of 30% on subscription for new shares, which is forfeit by shareholders if the shares are not held for more than five years;

· VCT dividends (including capital distributions of realised gains on investments) are not subject to income tax in the hands of qualifying holders;

· Capital gains on disposal of VCT shares are tax-free, whenever the disposal occurs.

Venture Capital Trust Status

Foresight Solar VCT plc is approved by HMRC as a venture capital trust (VCT) in accordance with Part 6 of the Income Tax Act 2007. It is intended that the business of the Company be carried on so as to maintain its VCT status.

The Directors have managed, and continue to manage, the business in order to comply with the legislation applicable to VCTs. The Board has appointed RW Blears LLP to monitor and provide continuing advice in respect of the Company's compliance with applicable VCT legislation and regulation. As at 30 June 2015 the Company had 81.0% (2014: 78.9%) of its funds in such VCT qualifying holdings.

Future Strategy

The Company will limit its future investment in new solar plants to concluding projects for the C share class - given the significant changes in both the UK Government's attitude to the development of photovoltaic solar and also in the VCT regulatory environment within which we operate as mentioned above. We expect to be in a position shortly to invite shareholders to consider the Board's proposals for new investments in the energy industry more broadly.

David Hurst-Brown

Director

22 October 2015

Manager's Report

UK Assets

Four plants in Kent, Somerset and Wiltshire are the principal assets of the Ordinary Shares fund and are all trading successfully and benefitting from index linked Feed-in Tariffs (FiTs) over 25 years. Because of the favourable differential between the yield on new ROC based plants and the cost of the bond re financing, executed in 2013, investors in Foresight Solar VCT's Ordinary Shares fund are benefitting from higher dividends and greater capital appreciation as a result of this refinancing.

During the period six companies representing the original investments of the fund deployed cash generated from the issuance of the bond to enter into Capacity Agreements with the Turweston solar project. These agreements substantially take the form of the original agreements in place with the four FiT assets. Turweston is a 16.45 MW site and is accredited as a 1.4 ROCs project. This acquisition means the Ordinary Share class is now fully re-invested following the bond refinancing.

During the period, under review, production from the four FiT sites was above expectations. Turweston had suffered an unusually long external grid disconnection outside of our control during the period resulting in production being materially below expectations. This is not expected to have an impact on long term dividends or returns. During the period, EBITDA of the Ordinary Share assets was in line with expectations.

Each 100.0p invested in new solar ROC plants is targeted to generate a total return of 120.0p. Adding this to the current portfolio should lead to an increase in total returns on the UK based portfolio for the Ordinary Share investors. The Ordinary Shares fund's targeted return of 130.0p was conceived when the more generous FiT subsidy mechanism was in place.

European Assets

Although the Foresight Solar VCT Ordinary Shares fund is predominantly comprised of UK solar assets, the Company also has exposure to several assets in both Italy and Spain accounting in aggregate for c.10% of the portfolio value. The European assets enjoyed strong irradiation levels throughout the year and strong technical performance meant that production was well above the expectations of the Investment Manager.

Regulatory risk in the Italian solar sector has stabilised somewhat in the latter part of the period and we are actively re-financing the loans outstanding in the Italian portfolio.

Foresight has analysed the impact of the change in legislation on the portfolio and after the re-financing expects a drop in IRR of c. 3% across the portfolio (from c. 11.0%). This has been reflected in the valuation. The Ordinary Shares fund's exposure to the Company's Italian assets is 7% of the portfolio value. A reduction in fair value of 23% is in place against the cost of the Italian assets held by Foresight Solar VCT plc. Operating costs across the assets continue to be reduced through contractual negotiations.

The Spanish assets owned by the Company have also been negatively impacted by changes in legislation, which have effectively placed a cap on the returns that Spanish solar assets can generate. This cap has been set at 7.4% (calculated as 300 basis points over the average of the 10 year Spanish Government Bond yield). The Ordinary Shares fund's exposure to the Company's only Spanish asset is 2.4% of the portfolio value. A reduction in fair value of 50% is in place against the cost of the Spanish asset held by Foresight Solar VCT plc.

The combined reductions in valuation for the Italian and Spanish assets will weigh negatively on the ability of the Ordinary Shares fund to achieve more than the target total return of 130p per share.

Exit

The Investment Manager feels it is too early to perform dependable analysis on exit valuations. Whilst the UK portfolio can be predicted with some accuracy the overall outcome for the Ordinary shares is impacted by the Spanish and Italian investments outcome. We will write to Investors to set out proposed exit plans when further clarity can be offered on final returns. At this stage we continue to be relatively comfortable with the £1.30 target.

As part of any exit process, we will consider refinancing opportunities for the portfolio if, like the Solar Bond, they enhance shareholder returns.

'C' Shares

The C share class does not have any exposure to Italian or Spanish assets and the recent increase in the supply of smaller and more appropriate sized assets has led to the Fund acquiring two solar assets. Saron and New Kaine, sized at 6.3 and 1.9MW respectively, were completed during the period. The Fund has a third asset under exclusivity that, upon completion, will see materially all (£10 million) of the C share class fund deployed.

Production from assets held by the C share fund was above the expectations of the Investment Manager.

US assets

During the period the C Share fund made a loan of £1.8 million, the balance of funds to deploy in connection with a solar project in Colorado, USA. The loans were repaid during the period in full generating a c.5% return in under 7 months.

The C Shares fund has signed binding contracts to acquire the equity ownership of the 3.6MW portfolio located in Lancaster, California, a region which benefits from some of the highest levels of irradiance in the world. The project has been operational for 19 months and to date has performed above base case projections. The C Shares fund will invest c. £1m in the project.

Increasing Capital Value and Dividends

The overall asset scale generated from re-investing the bond proceeds and the C Shares fund proceeds is expected to enhance investor returns for both share classes, particularly in optimising ultimate sale proceeds. If there were an appropriate disposal of both portfolios to the same buyer in due course.

Health and Safety

There were no health and safety incidents reported during the year. The Investment Manager has appointed a health and safety consultant to review all portfolio assets to ensure they not only meet, but exceed, industry and legal standards.

Market Conditions

Power Prices

Although the UK experienced significant downward volatility in the wholesale power market in 2014, prices have stabilised since the beginning of 2015 and current power price forecasts are reflected in the NAV.

Removal of Climate Change Levy Exemption

On 8 July 2015, the Chancellor announced the UK Budget which included the removal of the climate change levy exemption for renewably sourced electricity, meaning all renewable generators will stop receiving Levy Exemption Certificates ("LECs") from 1 August 2015. The Company is pursuing a judicial review, alongside other renewable generators, as to the speed of implementation of these changes. Any financial impact from this action has not been included in Investment Valuations.

Discount Rate

During the period, the Company reduced its weighted average discount rate applied to future cash flows which has had a positive impact on NAV. We believe this reduction reflects the risk profile of the operational assets that have been acquired, the total installed capacity at portfolio level and asset diversification.

Risk Management

Reliance is placed on the internal systems and controls of external service providers such as the Investment Manager in order to effectively manage risk across the portfolio. Foresight has a comprehensive Risk Management Framework in place which is reviewed regularly by the Directors.

We consider the following as key risks and mitigants to the Fund at this time are:

Electricity Market Reform

Risk: As a result of the introduction of the capacity mechanism under EMR, designed to ensure that the UK has sufficient reliable generating capacity to meet a specified capacity margin and prevent black-outs, wholesale electricity prices may be depressed, as some fossil-fuel power plants will receive capacity payments which will cover part of the costs of constructing and operating them. The carbon price floor is an element of EMR which is designed to support the deployment of renewable generation technologies by underpinning the price of carbon emissions allowances (required to be surrendered by fossil-fuelled combustion plants). However, the UK Government may decide to abolish the carbon price floor or set a lower trajectory for the increase of the carbon price floor. Such abolition, or the UK Government setting a lower trajectory for the increase of the carbon price floor, would likely reduce the wholesale power price.

Mitigant: The UK Government remains committed to a balanced generation mix, whereby renewables as a share of future generation capacity is expected to continue to rise. This is underpinned by EU and UK binding policy targets.

Decline in the sale price of electricity

Risk: Generally, the price at which a solar PV plant sells its electricity is determined by market prices in the UK. A decline in the costs of other sources of electricity generation, such as fossil fuels or nuclear power, could reduce the wholesale price of electricity further. A significant amount of new electricity generation capacity becoming available could also reduce the wholesale price of electricity.

Mitigant: Solar assets acquired under the ROC system will be exposed to market prices for electricity, accounting for c. 50% of overall plant revenue but will also benefit from the remaining 50% of revenues being guaranteed with ROCs. Electricity price-linked revenues are defined in Power Purchase Agreements ("PPAs") signed with off-takers (typically a big six utility company).

The proportion of revenue from a FiT asset deriving from subsidies is c. 85%, further reducing impact on declining power prices.

Assets are subject to appropriate downside sensitivity analysis with respect to electricity prices to ensure that revenues remain robust in this scenario which will be reflected in the price we offer for each asset.

Risks relating to RPI

Risk: The revenues and expenditure of solar PV assets via the ROC system are partly subject to indexation with reference to RPI. In absolute terms, distributions would be adversely affected by deflation.

Mitigant: We consider the inflation risk presented by these assets to be minimised through the explicit inflation-linked nature of both operating revenues and costs. On the revenue side, ROC and FiT prices are formally linked to RPI and for PPAs the electricity price forms part of the RPI basket of goods. For costs, bond repayments, O&M contract prices and land rents are both linked to inflation and as such there is a natural inflation linkage to costs and revenues.

An end to grandfathering policy commitments

Risk: The UK has revised its policies supporting the renewable energy sector from time to time in order to reduce the benefits available to new renewable power generation projects. The assets would likely suffer a loss if the UK was to abandon the practice of grandfathering and apply adverse retrospective changes to the levels of support for operating projects.

Mitigant: There is significantly less risk of support being reduced, withdrawn or changed for existing accredited projects. In order to maintain investor confidence, the UK has ensured that the benefits already granted to operating renewable power generation projects are exempted from future regulatory change. This practice is referred to as grandfathering.

Shorter than forecast operational life span of solar panels

Risk: Investors could be adversely affected by a reduction in production efficiency over the long term.

Mitigant: Each asset is subject to robust technical due diligence to assess the expected operational life span of the panels. Panels are typically covered under a 25 year performance warranty. The Company seeks to access projects with those reputable and proven equipment suppliers most able to demonstrate financial robustness being preferred. Full scope O&M with experienced counterparties should further ensure any such issues are identified early and rectified appropriately.

Change in weather patterns in the UK

Risk: The profitability of a solar PV asset is dependent on the radiation conditions at the individual solar PV plants and upon the meteorological conditions at the particular site. Solar electricity generation is reliant upon daylight rather than sunlight and plants are able to continue to generate power even during poor weather. Annual solar radiation per square metre averages approximately 1,100kWh in the UK as a whole, with higher irradiance of up to 1,300kWh per square metre available in Cornwall. There is risk that expected long term weather patterns change.

Mitigant: Each plant that is acquired will be subject to robust irradiation studies based on c. 20 years of historical weather data in order to derive a site irradiance value which is both conservative and robust and is appropriately accounted for in the acquisition price. Irradiation is the key determinant of solar power production and it is dependent on the hours of daylight availability as opposed to direct sunlight. This means that solar power plants are able to generate electricity even on days without clear skies. In addition, the levels of solar irradiance in the Southern parts of the UK compare favourably with those of Germany, the world's largest solar market with approximately one third of global installed capacity, making the UK a similarly viable location for solar investment. As a result the majority of solar power plants in the UK tend to be located in the Southern parts of England and Wales to maximise levels of production.

Environmental and Social Governance

Environmental

The Company invests in solar farms. The environmental benefits received through the production of renewable energy are widely publicised.

Further to the obvious environmental advantages of large scale renewable energy, each investment is closely scrutinised for localised environmental impact. Where improvements can be made the Company will work with planning and local authorities to minimise visual and auditory impact of sites.

Biodiversity Assessments

The Investment Manager has appointed Kent Wildlife Trust to explore the feasibility of maximising the biodiversity and wildlife potential for some of its UK solar assets. The initial phase of the initiative has involved undertaking site visits involving a walkover survey and preliminary desktop ecological study. The results have been used to prepare scoping reports which identify existing features of wildlife importance and assess the opportunities for biodiversity enhancements at these sites.

These initial reports will be used for the preparation of a series of site specific biodiversity enhancement and management plan to secure long-term gains for wildlife. These assessments are still in progress across the portfolio.

Social

Foresight Group is a signatory to the United Nations-supported Principles for Responsible Investment ("UNPRI"). The UNPRI is a global, collaborative network of investors established in 2006.

Outlook

Significant progress has been made during the period in deploying and committing capital across both share classes. Once the remaining asset is acquired using C share funds, we will continue to focus on generating operational efficiencies and optimising financial and technical reporting in order to identify areas where value can be enhanced in order to support ongoing capital growth.

The March 2015 1.4 ROC banding deadline for assets over 5MW drove large amounts of activity this year in terms of new capacity being installed, with reports estimating that more than 2GW was installed by the year ending 31 March 2015, bringing UK total installed capacity to over 7GW.

In our view, the recently announced Government changes, such as the removal of LECs (Levy Exemption Certificates) and the consultation on early closure to the RO (Renewable Obligation) for sub 5MW assets, were not unexpected as DECC had previously flagged it would continue to monitor the deployment of new installation under the RO scheme and subsequent impact on the Levy Control Framework ("LCF"). We believe this confirms DECC's continued intention to introduce changes that support the future sustainability of the LCF without impacting the existing support mechanism for renewable energy investments. This may indeed be positive for existing operating portfolios in terms of scarcity value being taken into account by potential acquirers.

If the early closure of the RO is confirmed, this should not affect any of the existing operational assets in the Fund portfolio or any of our announced projects under exclusivity.

We have confidence that the secondary market in solar assets will remain strong as we get closer to the 5 year anniversary of the Ordinary

Shares fund. We will keep refinancing opportunities under review to optimise value ahead of and in conjunction with any sale.

Jamie Richards

Head of Infrastructure

Foresight Group

22 October 2015

Statement of Directors' Responsibilities

The Directors are responsible for preparing the Annual Report and the financial statements, in accordance with applicable law and regulations.

Company law requires the Directors to prepare financial statements for each financial year. Under that law the Directors have elected to prepare the financial statements in accordance with UK Accounting Standards and applicable law (UK Generally Accepted Accounting Practice).

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for that period.

In preparing these financial statements, the Directors are required to:

- select suitable accounting policies and then apply them consistently;

- make judgements and estimates that are reasonable and prudent;

- state whether applicable accounting standards have been followed, subject to any material departures disclosed and explained in the financial statements; and

- prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's transactions and disclose with reasonable accuracy at any time the financial position of the Company and enable them to ensure that its financial statements comply with the Companies Act 2006. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Company and to prevent and detect fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Directors' Report, Directors' Remuneration Report and Corporate Governance Statement that comply with that law and those regulations.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website (which is delegated to Foresight Group and incorporated into their website). Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

We confirm that to the best of our knowledge:

- the financial statements, prepared in accordance with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company; and

- the Directors' Report and Strategic Report includes a fair review of the development and performance of the business and the position of the Company together with a description of the principal risks and uncertainties that the Company faces.

On behalf of the Board

David Hurst-Brown

Chairman

22 October 2015

Unaudited Non-Statutory Analysis of the Share Classes

Income Statements
for the year ended 30 June 2015
			Ordinary Shares Fund			C Shares Fund
			Revenue	Capital	Total	Revenue		Capital		Total
			£'000	£'000	£'000	£'000		£'000		£'000
Investment holding gains			-	5,517	5,517	-		8		8
Income			921	-	921	234		-		234
Investment management fees			(152)	(456)	(608)	(53)		(160)		(213)
Gains on the value of derivatives			-	154	154	-		-		-
Other expenses			(276)	-	(276)	(157)		-		(157)
Return/(loss) on ordinary activities before taxation			493	5,215	5,708	24		(152)		(128)
Taxation			(102)	102	-	(5)		5		-
Return/(loss) on ordinary activities after taxation			391	5,317	5,708	19		(147)		(128)
Return/(loss) per share			1.0p	13.9p	14.9p	0.2p		(1.2)p		(1.0)p

Balance Sheets
at 30 June 2015
				Ordinary Shares Fund		C Shares Fund
				£'000		£'000
Fixed assets
Investments held at fair value through profit or loss				41,697		10,008
Current assets
Debtors				411		377
Money market securities and other deposits				9		-
Cash				119		1,102
				539		1,479
Creditors
Amounts falling due within one year				(125)		(10)
Net current assets				414		1,469
Net assets				42,111		11,477
Capital and reserves
Called-up share capital				383		125
Share premium account				-		1,609
Capital redemption reserve				2		-
Profit and loss account				41,726		9,743
Equity shareholders' funds				42,111		11,477
Number of shares in issue				38,316,956		12,511,089
Net asset value per share				109.9p		91.7p

At 30 June 2015 there was an inter-share debtor/creditor of £68,000 which has been eliminated on aggregation.

Unaudited Non-Statutory Analysis of the Share Classes

Reconciliations of Movements in Shareholders' Funds

for the year ended 30 June 2015

Ordinary Shares Fund	Called-up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Profit and loss account £'000	Total £'000
As at 1 July 2014	383	-	2	38,670	39,055
Expenses in relation to share issues	-	-	-	(336)	(336)
Repurchase of shares	-	-	-	(16)	(16)
Dividends	-	-	-	(2,300)	(2,300)
Return for the year	-	-	-	5,708	5,708
As at 30 June 2015	383	-	2	41,726	42,111
C Shares Fund	Called-up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Profit and loss account £'000	Total £'000
As at 1 July 2014	125	12,336	-	(204)	12,257
Expenses in relation to share issues	-	(27)	-	-	(27)
Cancellation of share premium Dividends	- -	(10,700) -	- -	10,700 (625)	- (625)
Loss for the year	-	-	-	(128)	(128)
As at 30 June 2015	125	1,609	-	9,743	11,477

Unaudited Income Statement

for the year ended 30 June 2015

	Year ended 30 June 2015			Year ended 30 June 2014
	Revenue £'000	Capital £'000	Total £'000	Revenue £'000	Capital £'000	Total £'000
Investment holding gains/(losses)	-	5,525	5,525	-	(2,921)	(2,921)
Income	1,155	-	1,155	1,041	-	1,041
Investment management fees	(205)	(616)	(821)	(201)	(602)	(803)
Gains on the value of derivatives	-	154	154	-	114	114
Other expenses	(433)	-	(433)	(402)	-	(402)
Return/(loss) on ordinary activities before taxation	517	5,063	5,580	438	(3,409)	(2,971)
Taxation	(107)	107	-	(111)	111	-
Return/(loss) on ordinary activities after taxation	410	5,170	5,580	327	(3,298)	(2,971)
Return/(loss) per share:
Ordinary Share	1.0p	13.9p	14.9p	1.0p	(8.3)p	(7.3)p
C Share	0.2p	(1.2)p	(1.0)p	(0.6)p	(1.3)p	(1.9)p

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 year.

The Company has no recognised gains or losses other than those shown above, therefore no separate statement of total recognised gains and losses has been presented.

 Unaudited Reconciliation of Movements in Shareholders' Funds

 

Year ended 30 June 2014	Called-up share capital £'000	Share premium account £'000	Capital redemption reserve £'000	Profit and loss account £'000	Total £'000
As at 1 July 2013	441	5,673	1	43,954	50,069
Share issues in the year	68	7,042	-	-	7,110
Expenses in relation to share issues	-	(379)	-	(178)	(557)
Repurchase of shares	(1)	-	1	(37)	(37)
Dividends	-	-	-	(2,302)	(2,302)
Loss for the year	-	-	-	(2,971)	(2,971)
As at 30 June 2014	508	12,336	2	38,466	51,312
Year ended 30 June 2015	Called-up share capital£'000	Share premium account£'000	Capital redemption reserve£'000	Profit and loss account£'000	Total£'000
As at 1 July 2014	508	12,336	2	38,466	51,312
Expenses in relation to share issues	-	(27)	-	(336)	(363)
Repurchased of shares	-	-	-	(16)	(16)
Cancellation of share premium	-	(10,700)	-	10,700	-
Dividends	-	-	-	(2,925)	(2,925)
Loss for the year	-	-	-	5,580	5,580
As at 30 June 2015	508	1,609	2	51,469	53,588

 

Unaudited Balance Sheet

at 30 June 2015

Registered Number: 07289280

	As at 30 June 2015 £'000	As at 30 June 2014 £'000
Fixed assets
Investments held at fair value through profit or loss	51,705	48,443
Current assets
Debtors	720	760
Money market securities and other deposits	9	8
Cash	1,221	2,308
	1,950	3,076
Creditors
Amounts falling due within one year	(67)	(207)
Net current assets	1,883	2,869
Net assets	53,588	51,312
Capital and reserves
Called-up share capital	508	508
Share premium account	1,609	12,336
Capital redemption reserve	2	2
Profit and loss account	51,469	38,466
Equity shareholders' funds	53,588	51,312
Net asset value per share
Ordinary Share	109.9p	101.9p
C Share	91.7p	98.0p

Unaudited Cash Flow Statement

for the year ended 30 June 2015

	Year ended 30 June 2015 £'000	Year ended 30 June 2014 £'000
Cash flow from operating activities
Investment income received	686	903
Deposit and similar interest received	1	5
Investment management fees paid	(818)	(867)
Secretarial fees paid	(167)	(182)
Other cash payments	(289)	(172)
Net cash outflow from operating activities and returns on investment	(587)	(313)
Returns on investment and servicing of finance
Purchase of investments	(1,808)	(10,000)
Net proceeds on sale of investments New proceeds on sale of financial assets	4,071 662	2,474 -
Net capital inflow/(outflow) from financial investment	2,925	(7,526)
Equity dividends paid	(2,925)	(2,302)
Financing
Proceeds of fund raising	-	7,069
Expenses of fund raising Repurchase of own shares	(463) (36)	(515) -
	6,554	6,554
Decrease in cash	(3,587)	(3,587)
Reconciliation of net cash flow to movement in net funds
Decrease in cash and cash equivalents for the year	(1,086)	(3,587)
Net cash and cash equivalents at start of year	2,316	5,903
Net cash and cash equivalents at end of year	1,230	2,316

Analysis of changes in net cash
	At 1 July 2014 £'000	Cash flow £'000	At 30 June 2015 £'000
Cash and cash equivalents	2,316	(1,086)	1,230

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 30 June 2015.  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. 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 2015, 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 2015 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 year end of £42,111,000 (2014: £39,055,000) and on 38,316,956 Ordinary Shares (2014: 38,316,956), being the number of Ordinary Shares in issue at that date.

 

Net asset value per C Share is based on net assets at the year end of £11,477,000 (2014: £12,257,000) and on 12,511,089 C Shares (2014: 12,511,089), being the number of C Shares in issue at that date.

 

5.    Return per share

	Year ended 30 June 2015		Year ended 30 June 2014
	Ordinary Shares £'000	C Shares £'000	Ordinary Shares £'000	C Shares £'000
Total return/(loss) after taxation	5,708	(128)	(2,800)	(171)
Total return/(loss) per share (note a)	14.9p	(1.0)p	(7.3)p	(1.9)p
Revenue return/(loss) from ordinary activities after taxation	391	19	384	(57)
Revenue return/(loss) per share (note b)	1.0p	0.2p	1.0p	(0.6)p
Capital return/(loss) from ordinary activities after taxation	5,317	(147)	(3,184)	(114)
Capital return/(loss) per share (note c)	13.9p	(1.2)p	(8.3)p	(1.3)p
Weighted average number of shares in issue during the year	38,331,915	12,511,089	38,365,782	9,064,723

Notes:

a) Total return per share is total return after taxation divided by the weighted average number of shares in issue during the year.

b) Revenue return per share is revenue return after taxation divided by the weighted average number of shares in issue during the year.

c) Capital return per share is capital return after taxation divided by the weighted average number of shares in issue during the year.

 

6.    The Annual General Meeting will be held at 1.00pm on 15 December 2015 at the offices of Foresight Group LLP, The Shard, 32 London Bridge Street, London, SE1 9SG.

7.    Income

	Year ended 30 June 2015 £'000	Year ended 30 June 2014 £'000
Bank interest	2	5
Loan stock interest	1,153	1,036
	1,155	1,041

8.    Investments held at fair value through profit or loss

	2015 £'000	2014 £'000
Unquoted investments	51,705	48,443
	51,705	48,443
Company		Unquoted & Total £'000
Book cost as at 1 July 2014		41,636
Opening investment holding gains		6,807
Valuation at 1 July 2014		48,433
Movements in the year:
Purchases at cost		1,808
Disposal proceeds		(4,071)
Investment holding losses		5,525
Valuation at 30 June 2015		51,705
Book cost at 30 June 2015		39,373
Closing investment holding gains		12,332
Valuation at 30 June 2015		51,705
Ordinary Shares Fund		Unquoted & Total £'000
Book cost as at 1 July 2014		31,636
Opening investment holding gains		6,807
Valuation at 1 July 2014		38,433
Movements in the year:
Disposal proceeds		(2,263)
Investment holding losses		5,517
Valuation at 30 June 2015		41,697
Book cost at 30 June 2015		29,373
Closing investment holding gains		12,324
Valuation at 30 June 2015		41,697
C Shares Fund		Unquoted & Total £'000
Book cost as at 1 July 2014		10,000
Opening investment holding gains		-
Valuation at 1 July 2014		10,000
Movements in the year:
Purchases at cost*        Disposal proceeds*        Investment holding gains		1,808 (1,808) 8
Valuation at 30 June 2015		10,008
Book cost at 30 June 2015		10,000
Closing investment holding gains		8
Valuation at 30 June 2015		10,008

*During the year there was a restructuring in the C Shares Fund however the underlying assets remained the same. The restructuring has not been included in the purchase or disposals.

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.

Foresight Group, which acts as investment manager to the Company in respect of its venture capital investments earned fees of £821,000 in the year (2014: £803,000).

Foresight Fund Managers Limited provides administration services to the Company, and received fees of £167,000 during the year (2014: £167,000). The annual administration and accounting fee (which is payable together with any applicable VAT) is 0.3% of the net funds raised by the offer (subject to a minimum index-linked fee of £60,000 for each of the Ordinary and C Share funds).

At the balance sheet date there was £3,000 due to Foresight Group (2014: £26,000).

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 investee companies arrangement fees of £579,000 in the year (2014: £300,000).

END

---

This announcement is distributed by NASDAQ OMX Corporate Solutions on behalf of NASDAQ OMX Corporate Solutions clients.
The issuer of this announcement warrants that they are solely responsible for the content, accuracy and originality of the information contained therein.
Source: Foresight Solar VCT PLC via Globenewswire

HUG#1960936