Aquila Energy Efficiency Share Discussion Threads

[cc2014] 02/3/2023 13:26

All todays's trades are sells apart from the first one at 77.015p.

And interestingly the bid has nudged up twice from 75p to 75.5p to 76.0p against this flow of sells.

It's XD today so that's 1.25p in the bag.

I am interested to see what happens next. The bid can move to 76.5p but after that it can't as it will collide with the offer at 77p. I think at that point we may find out more about the intentions of the MM's. My best thesis is that they are collecting stock quietly for someone. I note a late trade last night of 100k at 77p which based on the time stamp looks like a sell as well

[cc2014] 01/3/2023 16:02

heads you get an exit near NAV in the next 3-6 months. say a 5% discount to NAV.
Sell at 90.725 plus a couple of dividends along the way = 93.225.
Buy at 78.5p
Gives 18.75% return in 3-6 months

tails it carries on and you get 5p dividend this, followed by around 8.5% return next year as gearing deployed. I guess discount will narrow to 10% by then
Sell at 85.95 plus 5p plus 8.5p = 99.45p
Buy at 78.5p
Gives 26.69% over 22 months or around 14% a year.


Heads you win, tails you win.

[gopher] 01/3/2023 01:26

Probably the right result.

The problem is patience is required to get a good financial outcome which will be at a discount to NAV but the assets are likely decent quality and if you work out a return percentage it will be beat the market handsomely.

No question it will be wound up eventually IMO

[apollocreed1] 28/2/2023 15:20

I don't think management or shareholders will accept selling this at a substantial discount to NAV. I bought some more this afternoon at 77.99p. If we get NAV then I'll make 22%. Conservatively, I don't expect to make less than 10%, which is also fine by me.

I voted against continuation as soon as the documents were released. They were in ridiculous denial of the facts. You can't grow NAV at such a low market cap or with such a high discount. The yield of 7% isn't that great when larger trusts with longer pedigrees are offering the same - and rising base rates mean that relatively the yield isn't that great and NAV will suffer downward pressure.

[hugepants] 27/2/2023 16:15

I'd say that was unexpected

[pavey ark] 27/2/2023 14:51

Only last week I decided to add to my holding in SEIT rather than here ....mainly because I was unsure of the outcome of this vote.
I would imagine liquidating the assets could be long and messy so a "job lot" offer could come along but it would have to be at a substantial discount to make it worth the bother.
Is it in managements interests to make this process easy ?

[cynicalsteve] 27/2/2023 14:34

I'm conflicted about this, winding up would get me out of the hole I've dug for myself, on the other hand the recent updates were very positive. I suspect that the current shareholders include many who have no interest in energy efficiency and were looking for 'special situations' to make money from. I'm also wondering about the cost of liquidating the assets and how long it would take, would a merger be a better option?

[pavey ark] 27/2/2023 14:09

I read it as saying that after the proxy voting and before the meeting tomorrow it is very likely that the motion of continuation will fail.
As a result of the continuation motion failing the company will be wound up(????)

As the share price was at a considerable discount to the NAV the market is assuming a move closer to NAV.

Only been here since Nov 2022 then bought more in December....not really involved or up to speed but the above is just my take on things.

[cc2014] 27/2/2023 13:53

I don't know what I think of that announcement.

The market likes it.

[cc2014] 22/2/2023 14:14

My view is that the stock market is a curious place and the attitude to a stock can turn almost on a sixpence. I hope that is one of those occasions and AEET will be much higher sooner.

It's been available to buy at around 70p since the beginning of November and then in late January and early February prices under 70p were available with 68p briefly about the best you could buy at.

During those 3 months there was plenty of stock around and it felt like the MM's always had plenty. Certainly 90% of the time they did.

Somewhere about a week ago things changed and now the MM's have no stock at all. Since the last trade at 68p (which was mine) there's been almost nothing available to buy, not even 1000 shares most of the time. If you want to sell they are now offering 72p for reasonable size.


I suspect it's nothing more complicated than the seller has cleared.

Perhaps what tippped it more than anything is the publication of all the loans and the quality of the security. As someone else said it's much higher than they thought and I agree. It's completely transparent which always helps.


I have voted for the continuation and would encourage others to do the same. Voting is now available on both AJ Bell and HL. I'm happy to hold, collect the dividend and let the share price run up. The alternative is waiting for the Board to make a recommendation and then another vote. By then I suspect the share price will have run up anyway.

[andy246] 22/2/2023 14:01

Seeing the £20m buyback for AERS, I was expecting Aquila to launch a ~£2m buyback for AEET ahead of the continuation vote to boost the share price and get people excited.

[cynicalsteve] 22/2/2023 13:38

Making a small paper profit on some of my purchases now, unfortunately I'm still making a huge loss on the rest. The fantasy scenario would be an activist investor buying a big stake in the company ahead of the vote. Aquila's other fund AERS was at such a big discount that they decided to introduce a share buyback program so I wonder if Aquila might decide to cut their losses and quit the UK.

[cc2014] 22/2/2023 10:08

Looking more hopeful here. The MM's have relented and will let you buy 2500 shares for a change. Full price of 73p though.

[cc2014] 20/2/2023 10:49

No obligation at all. It's also interesting that this RNS didn't come out with the others.

I see it as the fund manager making a clear committment to the fund either as an attempt to persuade investors to vote for the continuation vote or they just see the shares as so cheap they are happy to buy anyway as they know they'll get far more than the current share price if the fund is wound up.

[hugepants] 20/2/2023 10:15

Yes its interesting especially since they had no obligation to do this?

[cc2014] 20/2/2023 08:43

Now that's an interesting RNS.

Where are Peel going to get 650k shares to fill that order?

We will likely learn something today.

[cc2014] 17/2/2023 16:44

From the half year report

"If any Continuation resolution put to shareholders is not passed, then the Directors shall, within six months of such Continuation resolution not being passed, put proposals to shareholders for the reconstruction, reorganisation or liquidation of the Company."

So, if you vote no, the directors have 6 months to decide what to do and then make a proposal which would then be voted on again.

Since the directors are recommending continuation now, out of those three I would see them going for reconstruction or reorganisation if the continuation vote fails. Liquidation makes little sense now the fund is all but fully invested

[cc2014] 17/2/2023 16:02

Dear Mr. MM,

You can have my stock at 95p. Well, maybe. If it gets to 95p, I'll probably want 100p

[cc2014] 17/2/2023 15:58

Andy,

PM sent.

[andy246] 17/2/2023 15:08

Is anyone able to buy AEET today?
I see only one broker available at 72 (vs quoted price of 67.5-70.0). I guess whoever was selling heavily over the last few months, is now waiting to see how the continuation vote goes.

I also see one broker is trying to buy 250,000 shares, so must have been mandated by a big investor to accumulate shares (which is also why he not selling any shares at any price)

[cc2014] 16/2/2023 09:25

Is there? On-line I can sell a large number within the spread yet I can't even get a quote to buy 1000 shares.

It seems to me they are creating a false market to either square their book or they have got an order to fill for someone.

I'm not really bothered. I've got plenty and happy to wait them out.

I expect the MM will square their book eventually. They usually do.

[hugepants] 16/2/2023 09:08

yes but still a big seller though.

NAV at end Dec announced at 95.4p which is higher than I expected.


and the 1.25p quarterly dividend goes ex on 2nd march

[hugepants] 13/2/2023 15:05

QuotedData’s morning briefing 13 February 2023
13 February 2023


"..The continuation vote was brought forward from 2025. The shares are trading on a 32% discount (this has been widening again in recent weeks) and the trust is sub-scale. We recommend that shareholders vote against continuation. The board says the opposite..."

[hugepants] 13/2/2023 10:05

circular:


They sound optimistic they'll pass the continuation vote although they don't disclose how many are definitely supporting it. They reiterate the 5p dividend for this year and are aware of the "very significant" discount to NAV.

The Board is very aware of the circumstances in which the Company finds itself. The Company is small in size and with a share price that is currently at a very significant discount to NAV, and the Board recognises the considerable challenges that these conditions present. Having now delivered on its initial investment commitments, the Board and the Investment Adviser are focused on continuing performance and on ensuring that the market understands both the important role of investing in energy efficiency to meet carbon reduction targets and the strong investment proposition being offered by the Company. The Board also remains committed to a continued, regular engagement with Shareholders. There are clearly factors outside the control of the Board which materially influence the Company's share price, but where we have the levers to improve the perception of the Company and narrow the Company's discount to NAV, we will strive to do so.