Gore Street Energy Storage Share Discussion Threads

[robertspc1] 21/10/2024 13:00

Analyst meeting was 11am this morning. I guess it went well and should improve sentiment from here.

[craigso] 21/10/2024 12:15

As the market slowly figures out how much of the dividend is supported by fixed revenues from the US, GSF should indeed get back on an up-trend instead of wallowing in a "but the dividend isn't covered" malaise.

[parob] 21/10/2024 10:28

Let's hope the bottom went in with Friday's news. Looks good so far.Attractive dividend and good potential for capital growth imo. I added more this morning.Market might not yet have noticed Friday's news but it will especially once we break the downtrend.

[nickelmer] 21/10/2024 10:24

Yes, thanks for highlighting that, sounds very positive

[waterloo01] 21/10/2024 10:22

Thanks. A very decent read

[parob] 21/10/2024 10:12

For those who haven't seen it.Article by The Oak Bloke (Oct 19)Considering the CAISO Resource Adequacy news, the 45.4% discount and 12.4% yield in my articleGore to the CorhTTps://t.co/wuMByGOoeE

[themachine2] 19/10/2024 10:54

yump

The muppet posting his usual b/s

[scruff1] 19/10/2024 10:47

Must be a good UK market

A major renewable energy project in Cardiff will go ahead, despite concerns over habitat loss. The energy park and data centre development proposed for the old motocross track off Rover Way in Tremorfa will have a 1,000MW battery storage capacity - making it one of the biggest battery storage facilities in the world.

There is a plan for a £750m facility with a capacity of 1,040MW in Manchester.

[yump] 19/10/2024 10:18

Being in a partnership with Goldman Sachs doesn’t seem an instantly likeable boast.

[waterloo01] 19/10/2024 09:58

Gore Street CapitalGore Street Capital
7,246 followers7,246 followers
23h • 23 hours ago

Great result by my colleagues in Gore Street Capital! A high-value long-term and stackable contract. Significantly increases our contracted revenue whilst unlike tolling agreements doesn't give our assets away to others to manage; our in-house teams are therefore able to continue to capture other revenue opportunities. Also the start of a great partnership with Goldman Sachs. We are looking forward to a strong final quarter as the portfolio delivers against the targets we laid out to our investors.

[waterloo01] 19/10/2024 09:47

Craigso, gets better and better!

Feeling much more comfortable that we'll not only see the divi maintained in full, but will see some very decent price appreciation. Too many, too negative for too long, although have learnt a lot in the process, esp re divi cover and agree with cocopath, that the managers fees will need to be addressed over the next 12 months, esp as the management time needed, is reduced further.

[craigso] 19/10/2024 08:30

Yes, in practical purposes J Aron won't ever be drawing power from Big Rock. (and when they do they will be paying market rates) It's just a regulatory requirement originating from the Enron days when traders sold MWhs in California they couldn't possibly provide. It's essentially free money, was always in their DCF model, and why this asset was project financed for $60m back in 2023.

I don't think HEIT or GRID selling part or all of themselves off is all that relevant. The regional diversification of GSF is what makes it a far better investment on a stand-alone basis, but it also means that there isn't one single player likely to swoop in to buy GSF as a whole.

There ought to be a price point for UK BESS assets that is well above current share prices, but enough below replacement cost such that somebody wanting a bigger presence in BESS can buy part or all of HEIT or GRID instead of building their own batteries.

[alan pt] 18/10/2024 19:57

The contract is for 100% of the "capacity" in terms of kWh, but as far as I can understand this is largely to satisfy a regulatory requirement, it has to be "available", but won't always (or even frequently) be fully utilised (though quite how this works if the batteries are at 50% when "called" is unclear)

So it is plausible to estimate that there is significant additional potential to earn trading revenues. However, this does rely on the model and estimation used. Given the general lack of trust in the manager that I see on this board, I'm quite surprised that this is not being questioned more?

This may also have helped today (from Citywire):
"Harmony Energy’s shares gained 1.9% today after it said it had received offers for both individual assets and its full portfolio. A shortlist of bidders had gone into a second round of negotiations with a decision expected in December."

Some sales close to NAV would certainly help to validate valuations in the sector

[george stobbart] 18/10/2024 17:45

My ex girlfriends uncle told me that this one is heading to 100p

He works for big city office and knows stuff unlike you plebs

[waterloo01] 18/10/2024 17:33

Agreed and easily justified by the reduce need for management post most built out and operational. You almost sound like a buyer cocopah!!!

[cocopah] 18/10/2024 17:22

As the income starts to increase the one thing we should all be focusing on Is badgering GSF about how much Gore Street Capital are taking out of the business and that is justified.

When the American assets are up and running, the income should be sufficient to easily cover the dividend …. but it won’t if Gore Street Capital continue to take so much out of the business.

[tas11osc] 18/10/2024 17:02

According to Deutsche Numis the timing of this new contract was helpful as revenues from Texas, which represents 15% of the portfolio by capacity, were down significantly year-on-year according to the Modo index.

[waterloo01] 18/10/2024 16:28

Even better. So this one asset could bring in $20m a year or more.

[outlawinvestor] 18/10/2024 16:19

Yep, says so in the RNS.

The RA contract is similar to contracts in the Great Britain ("GB") Capacity Market in that it is a long-term contract which is fully stackable simultaneously with other revenue streams. However, the RA contract is worth a substantially larger portion of the total revenue in this market. It is expected to account for up to 40% of the total expected revenue of the asset over the contract life. Due to the long-term fixed-price nature of the contract, it also supports securing project-level debt.

[waterloo01] 18/10/2024 15:39

I see a poster (starbright) on LSE has suggested that the $14m is for only 40% of the capacity, leaving 60% still to 'earn'?

[fishbournetrader] 18/10/2024 14:05

That is very kind CC2014.
In general I think that most RNS's from most companies are badly written and leave us wondering if the board are trying to hide the true facts from us. There are a few exceptions like Next.
I could have full time job trying to write them in clear English with the numbers that us investors want/need to see.

By my calculation, the annual dividend cost to GSF is £36.5M per year. (Happy to be corrected on that). This contract is $14M per year (£10.8M) so after costs covers 1/4 of the dividend in cash terms.

My guess is that the value of the contract excludes any profit that can be made from the buying and selling of the electricity. I have no idea why they used the word "stackable" in the RNS without explaining it clearly. I would be happy if someone, who has a better understanding than me, can explain it.

[hpcg] 18/10/2024 12:59

Put in a spread bet, but I need to get up to date. Interest rate direction is now helpful and that plus the Big Rock contract are enough to know for now.

[parob] 18/10/2024 09:43

Bought in today. Today’s news might be enough to reverse the trend. Attractive dividend.

[craigso] 18/10/2024 08:58

"Furthermore, we expect a material increase in contracted revenue contribution to portfolio cashflow through the Resource Adequacy contract, for which the 200 MW Big Rock asset is eligible once operational."

From the 11 September NAV update.

This asset was ALWAYS going to have a substantial fixed revenue element. It's just that most investors can't be bothered (or don't have the skill set) to look into it. GSF certainly isn't "worth" £14m more than it was yesterday. (I initially thought it was just market-makers screwing us on dividend reinvestment day)

I can understand people complaining about a "lack of transparency". But once GSF actually starts delivering P&L and cashflow numbers in 2025, the braver ones amongst us will appreciate having been able to buy shares cheaply in 2024 from those who don't like the GSF communications strategy...

[cc2014] 18/10/2024 08:13

Fair enough FishbourneTrader.

That's very clear. Perhaps on reflection I was being a bit harsh.

Would you like to write their RNS's. You write it much clearer than they do!