Latest Chairman's Statement

"Despite the setbacks in the environmental sector, Foresight Group remains
positive about the prospects for a number of the remaining investments in this

Philip Stephens



During the year to 31 March 2015, the net asset value per Ordinary Share decreased by 3.2% to 83.9p from 86.7p at 31 March 2014. A number of the private equity investments performed well, particularly Aerospace Tooling Corporation, Procam Television Holdings, TFC Europe and CoGen which together generated an increase in net asset value of £3.5 million.
The main reason for the decline in net asset value, resulted from the Board’s decision to reduce the valuation of Closed Loop Recycling to £nil with a further, final, provision of £4.0 million in light of the failure to achieve a sale and continuing trading difficulties. The company entered administration on 30 April 2015. Following this write off, the portfolio has little exposure to environmental type investments and the remaining portfolio comprises private equity type investments in a range of sectors. The majority are profitable at EBITDA level and increases in the valuation of these investments helped to largely offset the further provision made against Closed Loop Recycling.
Given the time, effort and money which went into Closed Loop Recycling in an attempt to make it a success, the failure of this investment was particularly disappointing. The Board and Foresight Group, as investment manager, are, however, now entirely focussed on achieving success from the private equity portfolio which, as noted above, predominantly comprises profitable companies. This strategy, which was first trailed several years ago in my statement, is starting to deliver attractive returns.
The C Shares fund net asset value increased significantly by 67.6% to 110.8p per share at 31 March 2015 from 66.1p per C Share at 31 March 2014, mainly due to the sale of Defaqto as well as the positive performance, generally, of its private equity portfolio, notably Aerospace Tooling Corporation and Procam Television. For a detailed review of all of the Company’s investments I refer you to the Manager’s Report that starts on page 10 of the Annual Report and Accounts.


Please click here for the full report.

Ordinary and C Shares merger


As part of the merger of Acuity Growth VCT plc (Foresight 5 VCT plc) and Acuity VCT 3 plc with Foresight 4 VCT plc in February 2012, through the issue of C Shares, shareholders also approved the conversion of C shares into Ordinary Shares. This Conversion is due to take place on the tenth business day following the publication of these audited results of the Company for the year ended 31 March 2015.




It continues to be the Company’s policy to provide a flow of tax-free dividends, generated from income and from capital profits realised on the sale of investments. Distributions will however inevitably be dependent on successful realisations, as well as cash generation from the portfolio, capital restructurings and interest payments. The recent and continuing success in generating cash from portfolio investments within the Ordinary Shares fund gives the Board confidence that it will be able to declare a dividend for the year ending 31 March 2016.
The Board is pleased to announce, principally as a result of the successful sale of Defaqto, the payment of a 25p dividend per C Share to C Shareholders on 6 August 2015. The dividend will have a record date of 10 July 2015 and an ex-dividend date of 9 July 2015.


Top-up Share Issues and Share Buy-backs


No shares were issued during the year.

During the period under review 285,000 Ordinary Shares were repurchased for cancellation at a cost of £163,000.

VCT Legislation


VCTs, as tax efficient investment vehicles, are periodically subject to new rules which the Government and/or the European Commission consider appropriate for achieving the VCT scheme’s objectives and to comply with the rules relating to state aid to promote risk finance investments. These proposed new rules were announced in the Chancellor’s Budget on 8 July 2015 and, in summary, are as follows:
  • Introducing an ‘age of company’ restriction of 7 years
  • Introducing a lifetime investment limit of £12 million
  • Restricting VCT investments in buyouts
  • All investments to be made with intention to grow and develop a business.
These rules will become effective from Royal Assent of the Finance Bill in 2015.




Although there is still considerable uncertainty in continental Europe as a result of stresses within the Euro area, the UK economy is in reasonable health and many portfolio businesses are now making steady progress. Many of the familiar risks, both financial and political, remain and there can be no grounds for complacency as all our investments operate in competitive environments.
The effect of the improvement in the economy has been noticeable in the performance of the private equity part of both the Ordinary Shares and C Shares portfolios which comprise the major part of each portfolio. Within both portfolios, a series of realisations, refinancings and loan repayments has generated significant cash balances. This underpins the Board’s dividend commitment to Shareholders and provides sufficient capacity for several new investments to be made over the medium term, which we anticipate will further enhance shareholder returns.
Philip Stephens


27 July 2015

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Existing and prospective investors should consider carefully the following VCT-specific risk factors. If any of the risks described below were to occur, it could have a material effect on a VCT's business, financial condition or results of operations. The risks and uncertainties described below are not the only ones that VCT and investors may face. Additional risks not currently known to the Foresight, or that the Foresight currently believes are not material, may also adversely affect its business, financial condition and results of operations and those of the VCTs it manages or operates. The value of shares in Foresight Funds could decline due to any of these risk factors, and investors could lose part or all of their investment.

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