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| Share Name | Share Symbol | Market | Stock Type |
|---|---|---|---|
| Gresham House Energy Storage Fund Plc | GRID | London | Ordinary Share |
| Price Change | Price Change % | Share Price | Last Trade
|
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|---|---|---|---|---|
| 0.00 | 0.00% | 42.00 | 14:06:14 |
| Open Price | Low Price | High Price | Close Price | Previous Close |
|---|---|---|---|---|
| 42.00 | 42.00 | 42.00 | 42.00 | 42.00 |
| Industry Sector |
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| EQUITY INVESTMENT INSTRUMENTS |
| Top Posts |
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Posted at 03/2/2025 12:28 by marktime1231 The reduction in fees, basing it on a hybrid of NAV and Mkt Cap, is half a step in the right direction. Nevertheless an annual fee over £4M is still astonishingly high, considering the dreadful financial performance. It would have been outrageous, the fee would have otherwise been around £5.7M, whether or not a dividend is restored late in the year. Not exactly sharing investors' pain.The decision last year, to reject a bid for a select slice of the portfolio they claim at around NAV, not sitting well. |
Posted at 06/1/2025 08:41 by boystown FWIW, IT Investor, Stuart Watson updated his P/F recently and had this to say about GRID...GRID sets out an ambitious three-year plan Gresham House Energy Storage continues to dominate both my research efforts and these portfolio reviews despite being one of my smaller positions. It held a Capital Markets Day in November setting out a three-year plan to increase its EBITDA from £45m in 2025 to £150m by 2027. The projected growth comes from adding batteries to existing sites (£33m), building half a dozen new sites (£47m), and an as-yet-undisclosed new revenue stream (£25m) where negotiations have been taking place for a while now. The first two will require a lot of fresh capital and with the shares at a big discount, that rules out the now seemingly old-fashioned route of equity fundraising. To put that projected growth into historical context, EBITDA was around £25m in 2023 and looks set to be around the same level in 2024, but it reached nearly £50m in 2022 when the portfolio was a lot smaller and frequency response revenues were much higher. GRID plans to refinance its existing debts of around £175m and seems to think it can secure a lower rate of interest due to the greater proportion of contracted revenues it now has. Its current margin is 300 basis points over SONIA, much higher than most alternative asset trusts, although a fair chunk of its borrowing is fixed at a lower rate with an interest rate swap. GRID will then look to secure additional funds from project financing, similar to the funding models used by solar and wind power trusts. The amount to be raised and therefore the additional interest cost coming off that £150m EBITDA target is to be determined. It all sounds very ambitious but a successful completion of the initial refinancing could provide a decent steer as to whether the further and much larger financing plans are viable. GRID is also talking with an investor about buying into its Glassenbury project at around NAV, augmenting it with additional batteries and taking it from a 50MW sub-one-hour duration asset to a four-hour asset. This might provide a useful marker as to whether its asset valuations are realistic, although the upcoming sale of Harmony Energy’s 395MW two-hour portfolio is probably even more important. I don’t think there have been any major UK battery projects changing hands so we don’t have the benefit of markers from other transactions. Battery storage revenues jumped in December to a run-rate of £84,000 per MW per year, according to Modo Energy, up from £47,000 over the first eleven months of 2024. That’s encouraging but we’ll have to see how sustainable that proves to be. GRID has contracted half its portfolio at just below £60,000 per MW per year to Octopus so it won’t have seen all of that upside. Finally, there have been a few director buys at GRID and Ben Guest has taken his stake above 3% again. He now owns 17.4m shares which is up from 14.4m at the end of 2022, the last disclosure I could find. GRID reckons that if its EBITDA is in the range of £45m to £55m in 2025 that will translate into cashflow per share of between 4.5 and 6.2p of which a sizeable but as yet undecided proportion will be paid out as a dividend, starting in the third quarter. It’s messy and it’s complicated and management has been guilty of overpromising before. So while I can see the shares moving quite a bit higher from here, assuming GRID can deliver most of what it has planned, I’m hesitant to take a much larger position. I have roughly the same amount in GRID as I do in HICL Infrastructure and I have a little bit more in Bluefield Solar. |
Posted at 19/12/2024 13:40 by craigso Once we have a price for HEIT, then GRID and to a lesser extent GSF should re-rate. Once we know the identity of the winning bidder, we can start to speculate about whether any losing bidders will take a look at buying GRID.However, it will still take a brave investor to recycle most of their HEIT proceeds into GRID, since management is clearly worse here. |
Posted at 19/12/2024 12:08 by george stobart no it's just because investors in GRID are sissies and gays whilst investing in HEIT involves having a pair |
Posted at 11/12/2024 11:01 by llef Nickrl, yes, there is a lot of BESS under construction, (and a lot of it is in very large sites, many hundreds of MWHs).I guess that means that a lot of investors still think there is good money to be made from BESS. I suppose the question for GRID investors, is how much of the pie is being swallowed by Gresham management. Tomorrow's peak to trough is £90 to £496! |
Posted at 04/12/2024 18:44 by pj84 Summary from the above noteGresham House Energy Storage Fund — Improving prospects suggest discount is overdone At the recent capital markets day, Gresham House Energy Storage Fund (GRID) detailed positive developments in H224, including growing capacity and rising revenues. It also revealed a three-year plan to achieve further growth and triple earnings, from an estimated £45–55m in 2025, to £150m in 2027. Funding is expected to come from a new project finance style arrangement based on contracted revenues. Subject to the successful conclusion of related refinancing, expected in Q125, the company plans to reinstate fully covered dividend payments from Q325. GRID is also negotiating an equity investment in one of its sites. This deal would potentially serve to confirm GRID’s valuation methodology, giving investors confidence that the current NAV is a realistic estimate of its true worth. GRID’s share price is currently at a significant, historically wide discount to NAV, but this deal, combined with other positive recent developments and GRID’s plans for further improvements in capacity and revenues, suggests the discount is excessive and likely to narrow significantly as the company’s plans are rolled out. |
Posted at 29/11/2024 12:10 by craigso Guest et. al certainly know that they have to grow or die.However, turning £1 into 50p isn't the kind of "growth" that investors are interested in. This smells a lot like fund managers hoping to save their fee income stream rather than acting in the best interests of their shareholders. |
Posted at 07/10/2024 12:32 by marktime1231 For anyone wondering "jakku" is an internal codename given by GRID to unidentified assets which were under offer, presumably a group of operational 1hr battery farms capable of increased duration but not yet in the funded augmentation pipeline.jakku is I think a Star Wars reference, an imaginary wilderness, feels about right! Given the discounted state of GRID it seems extraordinary not to take an offer at par value, but we will never know how "close to" the offer was. Everyone seems puzzled by the no-deal, which would have been a board decision rather than just by Guest. Gresham House has already been taken over this year, by Searchlight Partners. I imagine the new owners, and GRIDs main investor Blackrock, will be very concerned about the tumbling performance. Our bigger concern as small investors is that the current management did not see what was coming, they certainly didn't want to tell us and were in denial when we spotted the problems and raised doubts. Execution of plans has been a shambles. How do we trust them to be doing the right thing now, and do you believe we are getting an honest picture of the situation and prospects? |
Posted at 03/10/2024 12:05 by pj84 The update concludes: -Very wide discount may be an attractive investment opportunity Until a year ago, GRID’s shares usually traded at a premium to cum-income NAV (see chart at the start of this note), but a sharp share price decline over the past year has seen the share price enter discount territory. The company initiated a programme of share buybacks in February 2024, repurchasing a total of 4.4m shares before buybacks ceased in April 2024, to focus capital allocation to the construction of new projects and augmentations. The discount exceeded 60% at this point but has since narrowed to closer to 50%. This is likely to be due at least in part to the improvement in GRID’s revenue outlook over recent months, especially since the agreement of the tolling arrangement with Octopus Energy. In addition, investors may be beginning to see value in the shares. Alternative valuation estimates released by GRID for the first time in its H124 results show that at current merchant revenue levels and based on current operational capacity and the tolling arrangement discussed above, the company is valued at 9x EV/EBITDA, with a P/E ratio of 5.7x, on a forward basis. However, capacity is set to rise by end 2024, and medium- to long-term revenues are forecast to increase significantly based on third-party revenue curves, so both the EV/EBITDA and P/E ratios are likely to fall over time. This suggests the company’s shares offer potential value at their current level. The current wide and arguably unjustified discount may represent an opportunity for those investors who share the confidence of GRID’s manager and board in the long-term viability of the battery storage industry and in the company’s prospects. It will take more time for conditions in the sector to improve, and for GRID’s revenues to fully reflect recent developments, but as and when they do, the company’s share price discount has significant scope to narrow back towards its historical levels. |
Posted at 04/7/2024 06:36 by george stobbart Deutsche Bank Numis initiates coverage of Battery Storage Funds with Positive RatingLondon, July, 4 2024 The significant share price volatility across battery storage investment companies in 2024 (average -31% ytd) reflects the impact of lower actual and forecast GB revenues on earnings, dividends and NAVs. Ultimately, we believe battery storage has a significant role to play in the energy transition and in our view the inherent variability of the current merchant-based revenue model is masking upside potential of the listed peer group. Although we reiterate our view that the variable revenue profile is less suited to the high fixed dividend targets that underpinned initial investment pitches, we note the composition of returns is evolving with the introduction of greater contracted revenue visibility and earnings-based dividend policies. We do not rule out the possibility of further near-term share price volatility, but in our view the significant increases in operational capacity, expected over the coming months as companies execute existing build out programmes, gives rise to attractive potential earnings. This will improve cash cover for existing dividends and enable a return to distributions from funds where dividends are currently suspended. This, combined with the potential for asset sales and corporate action, will underpin a positive share price trajectory in our view. To download the full note (41 pages) please click here: Download battery storage note Evolution of revenues: The weakness in revenues for GB batteries over the past 12 months has been driven by falling prices for ancillary services amid increased supply, coupled with limited opportunities in wholesale markets. The picture has improved more recently, aided by the first steps of a programme to evolve the grid balancing systems, but it is expected to be some time before the impact of this is fully felt. Gore Street Energy Storage’s international exposure has partially cushioned the impact of this weakness in the GB market on overall revenues, while Gresham House Energy Storage has responded to the challenging environment with the introduction contracted revenues through a tolling arrangement. This two-year contract will reduce the volatility of earnings, but we expect some investors will question the potential returns upside that has been sacrificed. Do discounts offer value: Wide discounts are reflective of investor scepticism towards NAVs and portfolio valuations that are based on long-term, third-party revenue forecasts in a nascent market. As a result, we focus on nearer-term cash earnings and undertake a scenario analysis which assesses the likely run-rate earnings potential of each fund by the end of 2024 and underlines potentially attractive distributable returns going forward. We believe evidence of this translating into a more sustained period of improved returns will be required for share prices to see a significant further re-rating, but we note that there is also scope for value to be unlocked through M&A and asset sales, given significant capital is seeking access to the storage thematic. Preferred exposure: Based on our analysis we believe Gore Street Energy Storage offers investors the most compelling exposure to the BESS sector. Its significant anticipated growth in operational capacity in H2 gives rise to attractive forward-looking earnings potential, which should be relatively stable based on the portfolio’s international diversification across five uncorrelated grids. In addition, we note that shares of Harmony Energy Income also benefit from potential nearer-term catalysts, with the prospect of asset sales and other corporate action. |
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