Greencoat Uk Wind Share Discussion Threads

[nerja] 24/5/2022 09:21

Bp. Will have a £20 billion write off from Russia to mitigate it a bit

[tuftymatt] 24/5/2022 09:03

The company name always mentioned when there is talk of a windfall tax is BP
Today they are down just 2% so go figure!!

[woodhawk] 24/5/2022 09:00

Exactly tuftyman, little or no tax - even if it comes to pass.

[tuftymatt] 24/5/2022 08:55

I think when it comes to the detail behind any windfall tax most in this sector will be hit in a very small way if at all.

Buying opportunity imo and a reaction by the markets to the unknown.

[igoe104] 24/5/2022 08:39

They may as well start investing aboard, if the government start hitting them with taxs..

Invest in countries that give you concessions, rather than hit you with taxes..

Without companies like this, are are the government going to get anywhere close to hitting their green targets...

[panshanger1] 24/5/2022 08:34

Taking a bigger hit here than other reknewables this morning

[zac0_4] 24/5/2022 08:33

Unbelievable! I only took the plunge here with my first purchase yesterday! Talk about timing!!!!

[woodhawk] 23/5/2022 23:27

I wouldn't put anything past Bozo & his cretinous cabinet who are running this country into the ground. But then, you have to have had a windfall to be taxed on it.

[gateside] 23/5/2022 22:39

.....Chancellor Rishi Sunak has ordered officials to draw up plans for a possible windfall tax on more than £10bn of excess profits by electricity generators, including wind farm operators, on top of a hit on North Sea oil and gas producers....

[tuftymatt] 17/5/2022 06:45

I am in the same boat and have a view that the short term downside could be 3 or 4p but the upside much higher. Will watch for now but see this doing so well in the mid to long term.

[marktime1231] 16/5/2022 21:51

Aside from trying to time a possible fund raise the two opposing forces driving UKW price are:

in the plus column we can expect the NAV will rise each quarter, and keep rising every time a development project from the pipeline gets commissioned;

in the minus column the macro of wholesale energy prices which might take a breather, from lower domestic demand over Summer coupled with LNG supplies flooding in to the UK so we can support our European neighbours with surplus gas and electricity.

As you say the share price is at a relatively modest premium to NAV right now, if and when they go for the next fundraise it is likely to be at a premium of a few pence.

[nerja] 16/5/2022 21:18

Marktime1231
I can’t work out when is the best time to top up, wait for the fund raise, which may mean an upper nav to the last call, or grab some now , a 151 price looks a good point for me.

[marktime1231] 16/5/2022 21:08

A bit of research has not disclosed what price TRIG agreed with GIP for a 7.8% stake in Hornsea One earlier this year, but based on TRIGs fund raising issue in March they will pay across around £250M. If TRIG are also taking on debt pro-rata that means these two deals have been struck on similar terms. More expensive than early stage investment in onshore wind developments even adjusting for lower load factors, but Hornsea has an attractive inflation-linked tariff until 2035.

The terms of the acquired debt are hard to establish too. GIPs investment was financed by a complex of investment-grade "green" project bonds, and at a time of rock bottom interest rates. Long dated presumably. Based on comments from firms which participated I think the fixed coupons range 3-4%. Let's guess UKW will have to find £25M pa to service the term debt, plus the cost of servicing £200-250M drawn under the RCF at say 3% so another £7M pa. So net income should be around £78M pa.

That is starting to look quite a healthy deal, net income of £78M pa for an outlay of just £150-200M from cash. Repay the RCF from surplus cash flow over 3 years, or issue 150 million shares at 15?p to get gearing back down and use the increased free cash flow to boost dividends. 8.??p next year, please and thank you.

[yump] 16/5/2022 19:49

I’d just like to thank you for your very useful research.

[marktime1231] 16/5/2022 17:56

Factchecking myself ... good news.

DONG planned Hornsea One with a load factor of 42%. It has been operating for over two years now, and according to a report based on OFGEM / Elexon data the actual and life-projected load factor for Hornsea is 49%.

So UKW if all goes to plan has actually bought about £110M pa income with our money. That is more like it.

[whilstev] 16/5/2022 12:12

The last announced NAV is 149.3p . Fund raisings are normally at a premium to the NAV so hopefully any raising will not be very dilutive to the 155p share price.

[marktime1231] 16/5/2022 11:54

Very interesting and something of a departure for UKW, investing heavily in offshore for the first time? And paying a high price for 150MW of operational capacity rather than cheaper but riskier investing in early stage developments. Not sure if this will add much to NAV per share. I bet GIP are rubbing their hands.

Ignore the £400M price tag, this is costing £1.1B of which £700M is debt taken on whatever terms (which are?) and £400M paid across from surplus cash and some of the available RCF. Assuming a 35% load factor (it might be higher) UKW has bought in what corresponds to about £80M pa revenue. On the plus side it is secure income on a long term price formula, and will deliver immediate cash flow once the deal is complete. But I don't think this is enhancing dividend prospects, more like underpinning the current level.

Yes UKW is looking fully geared again, c. £1600M long term debt and c. £200M drawn on the RCF, the known pipeline probably covered by cashflow and available facilities but if UKW wants to reduce gearing and expand further there will need to be a fund raising issue.

[adrian j boris] 16/5/2022 08:21

Greencoat UK Wind PLC said Monday that it has agreed to acquire a 12.5% stake in Hornsea 1, the world's largest offshore wind farm, from Global Infrastructure Partners for 400 million pounds ($490.6 million).

The renewable infrastructure fund said that the acquisition is for a total enterprise value of GBP1.1 billion after including GBP0.7 billion of limited recourse debt.

Greencoat expects to fund the acquisition from cash flow and its revolving credit facility. The deal is expected to complete in the third quarter.

"This transaction, once completed, will add another high quality operating asset to our portfolio and increase our net generating capacity to over 1.6GW," Chairman Shonaid Jemmett-Page said.

Hornsea 1 has a total generation capacity of 1.2 gigawatts and is located in the U.K. North Sea. It is 50% owned and operated by Danish offshore wind developer Oersted AS and 50% owned by U.S. investment fund GIP.



Write to Jaime Llinares Taboada at [e-mail]; @JaimeLlinaresT



(END) Dow Jones Newswires

May 16, 2022 03:01 ET (07:01 GMT)

[nerja] 16/5/2022 08:14

Nope that’s correct, but normally what follows is a placing to pay off the revolving credit!

[yump] 16/5/2022 08:12

Well cash flow is not a placing and neither is revolving credit.

[nerja] 16/5/2022 07:32

The acquisition is expected to be funded from cash flow and, to the extent required, the Company's revolving credit facility.

Hmmm is that code for a placing soon?

[growthpotential] 11/5/2022 17:07

The one of very few bright sparks in an otherwise abysmal portfolio. Long UKW!

[growthpotential] 10/5/2022 17:16

What are the servicing costs like on wind mills, need to oil up those ball bearings?

[bothdavis] 29/4/2022 11:01

Wondered how the new solvency rules for Insurers and such: L&G, Phoenix etc, will impact this sector?

Such large sums being bandied about, they may well be looking to invest/buy such companies for steady growth and divis?

[marktime1231] 28/4/2022 23:04

Some key points from the latest fact sheet / NAV report.

Q1 generation (only) 1% ahead of budget, power prices an unspecified (massive) amount above budget. By my observation UK wholesale has been averaging 3-4 x normal, and is still x 3. From the clues given I calculate an income surplus over base plan of £65M in Q1.

The 16p jump in NAV from cash flow (3p) price outlook (7p) and inflation (6p). That says to me there is even more good NAV news to come in 2022 from cash flow and inflation, because the upgraded outlook is still a little conservative.

£250M RCF repaid, £900M debt, holding £184M in cash, gearing down to 21%, £600M facility available. An incredibly strong financial platform. Time for news of grand expansion plans.

1442MW operational, pipeline 306MW to commission 22/23 at £423M. No delays please. Adding capacity at significantly lower cost rate than historic average. (Edit - I estimate the commissioning of this pipeline would add 20p to NAV per share over the next 18 months). And at this level of cash flow those investment costs could be covered by income.

And / or they will have to increase the dividend sharply next year to reward investors and keep yield in step not just with RPI but with NAV / share price progress.

In conclusion UKW a buy all the way to 175p on predictable short-term prospects.

As regards AGM dissent over giving themselves shares, yes so a bit uneasy, well the manager is already getting their bonus from the soaring value of assets under management. The directors are getting paid already for not actually doing much to cause the results, if they want to share in the success of UKW they can bloomin' well buy shares like the rest of us. On the other hand if the remuneration non-exec sees the need for an incentive plan to keep on winning, well £10M is worth paying for the outperformance we are enjoying. So long as the incentive is for sustained income performance not just asset growth. A £10M special dividend equivalent to shareholders would be less than a ha'penny each.