Gore Street Energy Storage Share Discussion Threads

[stemis] 22/3/2024 12:02

I think if you search my posts on this board you'll get the drift of what I think...

[brucie5] 22/3/2024 11:23

Interesting distinction. So what is your basic assessment of the value case here please?

[stemis] 22/3/2024 11:02

There's no comparison between RECI and GSF. RECI's NAV is made up mainly of the value of loans it's made that will (hopefully) be repaid. GSF's NAV is a number made up by the board, using a npv calculation on cashflow and growth assumptions that none of us know...

[brucie5] 22/3/2024 10:50

11.49 is a dividend that screams "Cut me!". But then you see the discount to net assets at 41%. And of course with good geographical diversification. It seems to me a decent core holding; but whether to overweight? Not so sure. Similar dilemma in RECI. I'm sure many income seekers hold both, with one eye on the exit in event of the unforeseen, but not unforeseeable.

[stemis] 22/3/2024 10:48

Improvement, probably, but enough? Who knows.

The dividend cost at 7.5p is £37m.

From half year results; "the portfolio generated £19.3m of revenue during the period, amounting to £12.2m in operational EBITDA". Off that is holding company expenses of £3.8m. So group EBITDA was £8.4m. Annualised that's £16.8m. Even if you doubled that it would be £33.6m, so not enough to cover the dividend. Then there is depreciation (and remember this is an asset based business), interest and tax to come off the £33.6m which isn't going to be peanuts.

If they wanted to prove that group profits cover dividends then they could simply disclose group earnings. But they don't. I wonder why...

[spectoacc] 22/3/2024 10:42

Good summary @AlanPT. I'd add that a variable dividend on GRID and HEIT would probably include them asking for money back some qtrs :))

[alan pt] 22/3/2024 10:33

GSF are saying that the dividend will be fully covered once buildout of the existing assets is complete, but that won't be until the end of this year

In the meantime, around 0.6 is about right, though there is significant qtr to atr variability and I think there was a recent qtr which did achieve close to full coverage, so it can be a little confusing depending on which stat you read

This volatility is also why there is the idea of a variable dividend for the sector (this affects GRID and HEIT even more). As I have said before, I don't think that's a bad idea - maybe a base dividend with a top up bonus. But seems unlikely that GSF will go for it at the moment and to be fair their buildout coverage strategy seems sound

[wassapper] 22/3/2024 10:04

I think doubling your capacity and most of that being in non-UK markets is likely to make an improvement to the divi cover. Non?

"The £556m portfolio intends to double the size of its operational fleet to 800MW in 2024, at which point the US assets will account for 55% of total operational capacity, while GB will slip from 53% to 29%."

[stemis] 22/3/2024 09:20

It's covered on a holding company basis (I.e. the money the holding company strips from its subsidiaries) but on a consolidated basis (which would be clear if GSF did consolidated accounts), the dividend is probably uncovered by group profits.

[cc2014] 22/3/2024 07:13

They are probably pointing at GRID and HEIT rather than GSF

[cocopah] 21/3/2024 21:03

On another issue, if #GSF are saying the dividend is fully covered, I don’t see why the anylysts are calling for a break from the link to NAV (or claiming the divi coverage is only 0.6)? Something surely that #GSF could set the record straight my on.🤷‍♂️ԍ00;

[cocopah] 21/3/2024 21:00

I know the Big Rock development was bought from Avantus but as to whether the KKR investment has any implications for #GSF (see below) I am not sure. 🤔

hxxps://avantus.com/news/kkr-invests-in-avantus-to-support-renewable-energy-deployment-in-the-united-states

[scruff1] 21/3/2024 06:12

Been a bit dopey. Didnt realise it was ex div today. Maybe explains yesterday's fillip

[scruff1] 20/3/2024 21:17

Yea I saw the Citywire thing and thought -eh up whats this. Like you say - its nowt new unfortunately. Todays tick shows we still have a pulse though

[spectoacc] 20/3/2024 14:41

Citywire on GSF, won't be anything new:

[cc2014] 20/3/2024 12:08

What's not to like?

Interest rates looking more likely to fall sooner (albeit I don't think they will fall as far as the market thinks but I'll worry about that down the line)

Balancing mechanism starting to have a positive impact through bulk despatch, which has not benefitted large batteries as expected but seems to be more of a level playing field which suits GSF.

It's my view that we are pretty much back to normal now with the market slowly taking shares off Rathbones but based on daily volumes Rathbones aren't in any hurry to sell shares down here.

[zingaro] 20/3/2024 11:00

Perhaps because of inflation falling and the prospect of lower interest rates sooner ?

[scruff1] 20/3/2024 10:40

Bit of positivity this am, Tempting me to put the revolver back in the drawer

[cocopah] 18/3/2024 15:51

So … as I criticised the lack of comms … does anybody know whether (with our 1 hour batteries) we have been able to take advantage of the relaxation in the 30 minute rule and the relaunch of the bulk dispatch in the balancing mechanism? Also the income of £16.1 per kwh included a £3m compensation payment … without this ‘bonus’ how would Jan/Feb income have looked?🤔

[daveoz1] 18/3/2024 15:22

scruff1- Yeah maybe, trying to give them a boost..!

[scruff1] 18/3/2024 14:31

Maybe the point was that the writer is a long term investor in GSF

[daveoz1] 18/3/2024 09:25

At least the sector is getting some publicity. Some of you may have seen the article (two-thirds of a page in the Sunday Times Business Section yesterday) with the headline 'What to do when the wind doesn't blow'. Aha, I thought, this will be mainly about battery storage! Think again - just 8% of the article was about batteries. 'Battery storage projects are enticing to investors because of the double-digit returns they offer'. 'Batteries have really opened up a new investor universe' he gushed. Somehow I doubt that the writer is a long investor in GSF... He did warn however that 'the long queue to get connections to the grid could hold back their rollout.'

[marksp2011] 18/3/2024 07:53

The newer trusts all expected to trade at a premium so funding was via new equity and cash went to divisIn a nasty frame of mind, it is a bit of a financial engineering scheme where you get paid back your own capital and pay tax on itWith shares at a thumping discount the wheels fall off eg GRID.

[waterloo01] 18/3/2024 06:23

Battery storage market intelligence firm Modo Energy has released data confirming a 47% increase in weekly battery energy storage system (BESS) dispatched volume on the grid in Great Britain (GB) compared to eight weeks prior.

In January 2024, the electricity system operator National Grid ESO relaunched bulk dispatch for battery energy storage units in the Balancing Mechanism (BM) following its closure in December 2023 due to technical issues.

The bulk dispatch functionality allows for more battery instructions to be issued simultaneously across the GB energy network, which includes England, Scotland and Wales, but not Northern Ireland (hence the GB prefix, rather than the UK, which does).

[alan pt] 17/3/2024 23:47

Wasn't so impressed with that piece, reckon they confused US rhetoric (of which there is much) with the possibility of some actual real world impact

You think Republicans will really be passing legislation to tell companies how to make their financial decisions? Even if that was something that could feasibly be legislated?

Meanwhile, California is very supportive of green policies and Texas sticks stubbornly to their crazy lack of grid interconnects, leading to insane price spike profit opportunities. Seems that GSF made shrewd choices