Gore Street Energy Storage Share Discussion Threads

[scruff1] 27/1/2024 08:44

The continuation vote back in the summer was passed as I remember largely as management promised to restore the divi cover by the end of this year. No doubt that's largely based on Stoney and Ferrymuir contributions to the pot. I suppose by then we will know if this is going to ever live up to its promise or whether it is another 'what should/could have been.
nick - its hard not to get the impression that something that may not happen has been priced in(out!). It would be nice to think that the lost mkt cap would be returned just as quickly if it doesnt. We know better though!

[george stobbart] 27/1/2024 07:55

GSF needs to raise further the dividend given the significant cash cover in FY24 adj for pipeline delivery.

Investors wants answers why they are not announcing a dividend increase

[nickelmer] 27/1/2024 07:26

Looking at the share prices of GRID and HEIT relative to GSF I suspect the market is starting to price in the fact that GSF's global portfolio will ultimately deliver higher revenues, heaven knows where the bottom is in these 3 shares, but, I feel that GSF will be the cleanest shirt in a dirty laundry basket

[nickgrant2] 27/1/2024 07:12

How cemented into their legal obligations is a div cut approach that breaks the 7% + 0.5% per 7p over 100p?

I am assuming there is some way they could weasel it, accumulating a dividend deficit and simply keep on kicking it into the future? Issue the dividend in shares? I am sure they have people with a lot more imagination than that so many more options.

[waterloo01] 26/1/2024 20:33

City just repeating jefferies line. Most of the damage has been done already. They will near double capacity this year, much of it ex uk. Anyhow, if they want to reduce divi they will need to cut nav, and I see nav increasing, even if the share price doesn't.

[scruff1] 26/1/2024 20:19

Article in Citywire this pm re battery storage. Problem is the market is anticipating dividend cuts. These have been going nowhere and there seems to be no realistic possibility of that changing anytime soon. Capital destruction and dividend cuts = pan lid. You would be living with faith alone - a bit like monks - in sack cloths. I'll give it a tad longer. I dont like pulling out now but I think my money could produce better returns elsewhere until something more positive looking appears on the horizon and that doesnt really include Stoney or Ferrymuir - on their own they will make little difference imo. Whichever graph you choose - it looks terrible.

[george stobbart] 26/1/2024 19:49

Most likely another Jefferies hit piece coming Monday morning.

Why are they so obsessed with battery trusts now that they are falling towards the earth core?

They never showed up when the prices were at the 90s/100s

[mirandaj] 26/1/2024 18:56

NB "Stony commenced commercial operations as of 18th December"

[melody9999] 26/1/2024 18:48

CC 886. Great point. The Jefferies report is focused on what has already happened. If that is news to you, then its a sell signal which is what has happened generally across the sector.

But for those of us watching more closely (and recognising GSF geographic diversification) it is likely a good buy opportunity.

[cc2014] 26/1/2024 13:54

If my feed is to believed there is so much wind and sun today that fossil fuel only accounts for 8% of electricity generated

As a result the spot price of electricity went negative at 11am and has been £50MWh or higher negative since around 11:30 (or is it lower - currently running at £65MWh negative)

Time to get paid to fill up those batteries!

[cc2014] 26/1/2024 07:51

I'd like to see some Director buying too but the fund manager did spent £1m back in October buying back shares at 78.5p

[cc2014] 26/1/2024 07:42

I'm afraid I've seen this playbook before from Jefferies especially with the construction sector.

They wait until the share price has already been smashed down and then release their market update which will contain a very brief but selective set of information.

They would provide better value for their clients if they provided their update when the share price was high so I wonder why they do it this way round.

[spectoacc] 26/1/2024 07:34

Thanks @gs.

Personally I'd like to see some decent director buying at GSF - can see little over the years, compared to some where it's substantial (albeit not always successful).

Last September:
"Tom Murley, Non-Executive Director, purchased 75,000 ordinary shares of £0.01 each ("Ordinary Shares") in the Company at an average price of 80.096442p"

November 2022:
"Patrick Cox, Non-Executive Chair, purchased 196,500 ordinary shares of 0.01p each ("Ordinary Shares") in the Company at an average price of 113.36p per share".


Can't see a lot else, nor anything recent.

[george stobbart] 26/1/2024 07:24

Jefferies published another note today 26/1/24 gathering feedback from investor tours including battery storage trusts

Feedback from the Road
We present feedback on the common themes from our monthlong roadshow focused on the 2024 outlook for alternative investment companies.

Listed Infrastructure: The yield environment was, unsurprisingly, a focus, with questions centred around what level of risk-free rate would engender a broad-based re-rating of the sub-sector. That said, in stock-specific terms, investor interest was focused on the higher risk/reward funds, such as 3IN and PINT, which have little mechanical sensitivity to changes in risk-free rates within their valuations by virtue of utilising discount rates with material risk premia embedded. Elsewhere, SEIT was a significant area of interest, likely owing to the extent of its discount to NAV (of currently c.40%) and also the debate on whether the fund represents a bond proxy or growth opportunity.

Renewable Infrastructure: Most investor attention was focused on the extent to which M&A activity in this sub-sector is feasible and what form it could take. In valuation terms, the risks to power price assumptions, both at the front and back end of the curve, appear to be well understood, while there was growing interest in the consultation last year by the Department for Energy Security and Net Zero (DESNZ) on changing the payment structure of ROCs.

Battery Storage: Questions were dominated by the weak near-term revenue performance of GB batteries and the implications for dividend cover across the sub-sector. As such, it seems that the progressive dividend policies of the funds are being reassessed by the market, with investors likely to favour more flexible policies that better suit batteries' volatile earnings. In this context, we saw an increasing preference for GSF versus peers, given growing acceptance of the merits of its diversification strategy. Opinion on the longer-term outlook for batteries was more split, however, with some investors remaining confident of the longer-term secular growth story but others concerned over the potential for return saturation in multiple markets and technological obsolesce risks.

[rambutan2] 25/1/2024 23:38

Yes, a more flexible div/capital return policy makes much more sense considering the less steady state more volatile returns that batteries offer. imho

[waterloo01] 25/1/2024 20:06

The point of the article yesterday re take over activity in the German market is that the nav here is not out of whack to prices paid. The assets have value that's probably conservatively in the nav.. The current 10.5% retrun at 71p is telling me the share price is too low compared to the current marketed value, not that it needs a divi cut.

[yump] 25/1/2024 18:24

These 'research' folk never risk anticipating problems or benefits. Best for credibility to state them after they've happened. Quite pathetic that they get paid.

[alan pt] 25/1/2024 18:19

A good point about the volatility of revenues in this sector, it has been a surprise to me how much more volatile it is than renewables generally. GSF do seem to have mitigated this as far as possible with the international diversification and that seems to be working well

Still, I would be happy with a divi cut to perhaps 1.5p/qtr with a balancing 4th qtr divi dependent on actual revenues. That would seem perfectly sensible and would still give a guarantee of at least 6% plus a fairly strong bonus opportunity

[scruff1] 25/1/2024 18:02

I wouldnt bank on Ferrymuir !!!

[cocopah] 25/1/2024 17:58

I stand slightly corrected. The operational dividend cover was 0.72 and with contributions from Stoney & FerryMuir this year (plus the diversification of the portfolio) I would be surprised if it operational dividend cover wasn’t above 1.0 on an annualised basis this year.

The 0.5 statistic refers to fund-level dividend cover. It’s not a measure I’ve used or come across before so if anyone knows whether it’s an appropriate measure to use I would appreciate the enlightenment. 🤔🤔

[scruff1] 25/1/2024 17:49

Its like reading the same act of a play over and over. And about as action packed as Waiting for Godot. Its been falling for 2 years accompanied by the same tales. There really is nowt new to say. Im loaded with em but no longer confident. I am wondering how low this can go. Approaching the ATL again.

[waterloo01] 25/1/2024 17:29

They should correct it and also reiterate they are on to hit divi cover and don't intend to change the metric, and the growth is funded.

The Jefferies research would have been of more use 9 months ago, when something started to look wrong with the UK market prices. All a bit barn an door, especially as they say it should correct by end 24.

[cocopah] 25/1/2024 17:03

Interesting that Jeffries gets away with quoting divi cover that does not reflect the published data by GSF. The company should issue an RNS rebuttal, if nothing else. I have sent a message to the CEO asking him what, if anything, he intends to do. Whilst the dividend may not be fully covered, it is likely to be so this year and was certainly above 50%, more like 70%+ from memory. In addition, the note does not identify how well financed the GSF developing assets are, nor the future diversified revenue streams in 2024. Perhaps the company is not managing broker comms well enough.🤷R05;♂️🤔