Levelling up the regions, one coffee shop at a time
Like many before him, Sir Keir Starmer is a vocal fan of levelling up – calling for measures to spread jobs and economic growth across the country.
While the PM talks, Foresight Group is acting.
The company works with local authority pension funds to invest in up-and-coming businesses so they can develop, generate jobs and fuel growth in regions that have been deprived for years.
Founded in 1984, Foresight floated on the stock market in 2021 at £4.20 a share. Since then profits have almost tripled, with £64 million forecast for the year to March 31, while dividends have soared from 1.7p to an expected 22.2p.
Yet Foresight shares have fallen to £3.15 – a decline that seems unjust and should reverse.
Drinking to success: Foresight Group works with local authority pension funds to invest in up-and-coming businesses
Foresight is divided into three divisions, one focused on regional investments, one on listed businesses and one on infrastructure, from schools and roads to solar farms and forestry.
The regional arm works out of 15 offices across the UK and Ireland, each running funds dedicated to local businesses.
Investing on behalf of local authority pension funds, Foresight seeks firms that are profitable and well-managed but need a lift to help them expand.
Decisions are not taken lightly. The firm sees around 3,000 possible deals annually and invests in 50 to 100. Being choosy delivers results. The group has invested in hundreds of companies over the years and generally sells them for two to four times the initial price.
Nottingham-based 200 Degrees Coffee is a case in point.
The firm roasts its own beans and owned six coffee shops when Foresight came knocking in 2017.
With support and advice, the business grew to 21 shops, more than 180 jobs were created and the chain expanded across the Midlands and North West before being sold to Caffe Nero last year.
Foresight’s infrastructure arm is also known for its astute approach to investment. Under chairman Bernard Fairman, it operates 20 funds that invest in projects from battery-storage plants to roads and schools to greenhouses powered by waste matter.
There is also a division offering investors exposure to listed property, income and sustainability stocks – a business that was boosted this year with the timely acquisition of rival WHEB.
Foresight funds all charge management fees, which flow straight into group profits. As the business expands, profits should grow and Fairman aims to double earnings to £120 million by 2029.
That mean increased dividends, with brokers forecasting 25.7p for next year and almost 32p for 2027.
Midas verdict: Foresight Group is well run, well regarded and offers investors an annual yield of 7 per cent. Fairman and finance director Gary Fraser recently spent almost £2 million of their own cash on shares. Follow their lead, at £3.15.
Traded on: Main market Ticker: FSG Contact: foresight.group or 020 3667 8100
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This article was originally published by a www.dailymail.co.uk . Read the Original article here. .