Foresight Sustain. - Full deployment of equity and eleven acquisitions

Foresight Sustainable Forestry

19/01/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230119:nRSS2024Na&default-theme=true

RNS Number : 2024N  Foresight Sustain. Forestry Co PLC  19 January 2023

19 January 2023

 

Foresight Sustainable Forestry Company Plc

("FSF" or "the Company")

 

Full deployment of equity, eleven acquisitions adding c.1,464 hectares to the
Company's

portfolio and a planting update

 

Foresight Sustainable Forestry Company Plc, an investment company that invests
in UK forestry and afforestation assets, today announces its June 2022 equity
fundraising proceeds are fully deployed following the completion of eleven
acquisitions and provides an update on the development of afforestation
properties in the portfolio.

 

New acquisitions

 

FSF has deployed a further £19.2 million (inclusive of tax and transaction
costs) into nine afforestation properties and two forestry properties, ten of
which are in Scotland and one in Wales. The acquisitions increase the
portfolio by approximately 1,464 hectares and FSF's total portfolio now covers
11,215 hectares, with afforestation properties now accounting for 43% of the
portfolio's value. The Company continues to increase its allocation to
afforestation in line with the 40-50% target set out at the time of IPO.

 

Each afforestation acquisition is well suited for the establishment of a
woodland creation scheme and has design allocations to native broadleaves
alongside commercially productive forestry and open ground. Once planted, the
afforestation properties are anticipated to be awarded approximately 236,800
voluntary carbon units for the additional CO(2) sequestered over the project
lifetime.

 

The two forestry properties provide the Company with a good opportunity to
harvest, re-design and re-stock the sites in the medium term and add to the
Company's cluster of properties in Aberdeenshire, Scotland. The sites are well
located in relation to sawmills and timber processors which means that the
timber harvested will benefit from a cost effective and carbon-efficient route
to market.

 

Where the properties acquired are smaller than average for the Company, they
are located in close proximity to other properties within the portfolio to
create marriage value, and/or have been secured at particularly favorable
pricing.

 

Additional details about the properties can be found in the appendix to this
announcement.

 

Permission secured at three afforestation sites

 

The Company is pleased to report that it has secured the necessary planning
permission, full consents and grant contracts for three Scottish afforestation
properties in the portfolio. Planting at Upper Bar, Auchensoul and Redding
Farm is expected to start imminently and is scheduled to complete at all three
sites before the end of April 2023.

 

In aggregate, the properties cover 765 hectares and have a plantable area of
387 hectares. The Company aims to plant approximately 880,000 trees and the
commercial tree planting is estimated to deliver 220,000 tonnes of sustainable
timber production for each c.35-40-year rotation.

 

All schemes are registered with the UK Land Carbon Registry and the Woodland
Carbon Code ("WCC"). Once planting is complete, the process for full
accreditation and award of carbon units by the WCC can take place. Once fully
established, the sites are expected to permanently sequester 98,800 tCO(2)
over each projects' lifetime and generate associated voluntary carbon credits.

 

An additional four schemes, covering 502 hectares, are currently progressing
through the application process and are estimated to begin planting this
calendar year.

 

Richard Kelly and Robert Guest, Co-Heads of Foresight Sustainable Forestry
Company, commented:

 

"We are delighted to have added another eleven high quality assets to FSF's
portfolio and to be able to report further good progress, particularly across
the afforestation side of the business. Our carefully designed woodland
creation schemes will make an important contribution to the removal of carbon
from the atmosphere and increase the supply of sustainable home-grown UK
timber for future generations. We are also delighted to have fully deployed
the equity proceeds from FSF's June 2022 placing within 6 months, delivering
on a key commitment we made to investors at the time. Our ambition remains to
grow FSF and we continue to pursue a pipeline of attractive NAV accretive
investment opportunities. We have available funding through our RCF, which at
the current time remains fully undrawn and available. We are also pleased to
have received all the necessary planning permissions and approvals to now
commence planting at three more of our afforestation sites in Scotland.
Successfully developing afforestation sites remains the engine room of FSF's
returns and sustainable impact."

 

About the Company

Foresight Sustainable Forestry Company Plc is an externally managed investment
company investing in a diversified portfolio of UK forestry and afforestation
assets. Targeting a net total return of more than CPI +5%, the Company
provides investors with the opportunity for real returns and capital
appreciation driven by the prevailing global imbalance between supply and
demand for timber; the inflation-protection qualities of UK land freeholds;
and biological tree growth of 3% to 4% not correlated to financial markets. It
also offers outstanding sustainability and ESG attributes and access to carbon
units related to carbon sequestration from new afforestation planting. The
Company targets value creation as the afforestation projects successfully
achieve development milestones in the process of converting open ground into
established commercial forest and woodland areas. The Company is seeking to
make a direct contribution in the fight against climate change through
forestry and afforestation carbon sequestration initiatives and to preserve
and proactively enhance natural capital and biodiversity across its portfolio.
It is managed by Foresight Group LLP.  https://fsfc.foresightgroup.eu/
(https://fsfc.foresightgroup.eu/)

 

For further information, please contact:

 Foresight Sustainable Forestry Company Plc        +44 20 3667 8100

 Robert Guest

 Richard Kelly

 fsfc@foresightgroup.eu

 Jefferies International Limited

 Tom Yeadon                                        +44 20 7029 8000

 Will Soutar

 Harry Randall

 Citigate Dewe Rogerson

 Toby Moore (toby.moore@citigatedewerogerson.com   +44 7768 981763
 (mailto:toby.moore@citigatedewerogerson.com) )

 

This announcement does not constitute, and may not be construed as, an offer
to sell or an invitation to purchase investments of any description, or the
provision of investment advice by any party. No information set out in this
announcement is intended to form the basis of any contract of sale, investment
decision or any decision to purchase securities in the Company.

 

This announcement may include statements that are, or may be deemed to be,
"forward-looking statements". These forward-looking statements can be
identified by the use of forward-looking terminology, including the terms
"believes", "estimates", "anticipates", "expects", "intends", "may", "will",
"targeting" or "should" or, in each case, their negative or other variations
or comparable terminology. All statements other than statements of historical
facts included in this announcement, including, without limitation, those
regarding the Company's financial position, strategy, plans, proposed
acquisitions and objectives, are forward-looking statements.

 

 

Appendix

 

Acquisitions: asset specific information

 

 Name                            Acquisition date  Location                           Asset Type     Acquisition cost (including tax and other transaction costs, £m)   Size of asset (hectares)  Anticipated sequestration of additional CO(2) equivalent (tonnes)
 Glendyne Wood                   19/10/2022        Scotland, Dumfries & Galloway      Afforestation  1.67                                                               142                       31,162
 Bruntaburn Forest               04/11/2022        Scotland, Scottish Borders         Afforestation  1.95                                                               123                       27,850
 Goukstane Wood                  09/11/2022        Scotland, Scottish Borders         Afforestation  1.90                                                               112                       20,619
 Redding Farm                    11/11/2022        Scotland, Aberdeenshire            Afforestation  0.94                                                               71                        15,859
 Cessnock Wood                   11/11/2022        Scotland, Ayrshire                 Afforestation  1.72                                                               109                       24,455
 Allanton Farm                   17/11/2022        Scotland, North Lanarkshire        Afforestation  1.24                                                               78                        15,669
 Newnoth Forest                  13/12/2022        Scotland, Aberdeenshire            Forestry       0.79                                                               80                        N/A
 Coed y Garreg                   22/12/2022        Wales, Carmarthenshire             Afforestation  1.58                                                               80                        19,540
 Upper Senwick                   11/01/2023        Scotland, Dumfries & Galloway      Afforestation  1.40                                                               102                       20,158
 Highside Wood                   12/01/2023        Scotland, Scottish Borders         Afforestation  3.59                                                               197                       40,834
 Bedehouse & East Bennachie      12/01/2023        Scotland, Aberdeenshire            Forestry       2.42                                                               370                       20,688

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  ACQKZGMMFRKGFZZ