Gresham House Energy Sto... Share Discussion Threads

[speedsgh] 05/5/2023 11:04

Dividend Declaration -

Gresham House Energy Storage Fund PLC (LSE: GRID) is pleased to announce a dividend of 1.8375p per Ordinary Share for the period from 1 January 2023 to 31 March 2023. The dividend will be paid on 8 June 2023 to Shareholders on the register as at the close of business on 19 May 2023. The ex-dividend date is 18 May 2023.

Any such dividend payment to Shareholders may take the form of either dividend income or "qualifying interest income" which may be designated as an interest distribution for UK tax purposes and therefore subject to the interest streaming regime applicable to investment trusts. Of this dividend declared of 1.8375 pence per Ordinary Share, 0.3375 pence is declared as dividend income with 1.5 pence treated as qualifying interest income.

[willywonka12] 03/5/2023 10:49

Always delay in news

[cruelladeville] 02/5/2023 16:24

Dividend declaration day tomorrow and ex dividend on 11th May. Looking forward to more news from GRID.

[cruelladeville] 11/4/2023 19:19

Nice share price appreciation here today. Can't see any news from GRID?

[cruelladeville] 07/4/2023 07:58

Positive commentary from Tempus in The Times today. Continuing intention of long term hold of GRID here.

[nickrl] 06/4/2023 23:15

Its odd that HEIT are retreating whilst GRID are advancing

[jonwig] 06/4/2023 17:13

marktime - thank you or your detailed response.

For myself, I had little time to go beyond the headlines, and was perfectly satisfied with what I read. I was expecting mentions of delays (the word occurs 26 times) and wasn't fazed.

As far as grid connection goes, delays are well-known, and maybe there's consolation that other countries experience same and more. (China!)

There will be some analysis before long (Edison, I think, and some others - not, I admit, independent.

[marktime1231] 06/4/2023 13:07

Redefining "excellent"?

More like terrible. Still only 590MW in operation, versus the 1197MW planned according to the report last year. Less than half a job. Rapidly drawing down debt eg at £50-60M per quarter, available funds must be getting low. More debt or dilution anyone? (Compare this to UKW for example, acquiring new assets from surplus cash flow while indexing the dividend with inflation). How can you / they be "pleased"? The named two projects, already miles late, are suffering further commissioning delays, something they couldn't see or didn't want to report in an update just four weeks ago. What does "close" mean, last time they said "imminent" it was several months not weeks away. So how can you believe anything they say about future expectations? Surely a significant chance GRID won't deliver the revised plan of 1GW operational by year end.

GRID has missed out on the bubble in energy prices, a massive opportunity squandered. And now prices are subsiding. Being intensively focused on developing early stage projects to drive up NAV has backfired versus paying the price to acquire operational capacity and maximise the income opportunity. GRID are not being frank, they are not delivering. The first dividend increase for three years, and even that is -5% on inflation! I suspect there is not much net NAV improvement to look forward to either, less than the premium in the share price anyway.

As I have said before it doesn't matter why projects are late, nor who is to blame, the damage to income has been done and is being done. The share price does not reflect the execution risk, the premium is unfounded.

[nickrl] 06/4/2023 10:14

According to www.bessanalytics.com/ GRID operated sites have been falling down the list for some weeks now and its long duration assets that are making the running. My take on this is that GRID are banking on volatility to drive trading opportunities but the ESOs mandate is to avoid that and market dynamics look far more stable in 2023. So i reckon we will see setbacks during the year and with no big wind farms due online till 2024/25 now it might be a waiting game.

[cruelladeville] 06/4/2023 09:17

Very encouraging. One to tuck away for the long term.

[jonwig] 06/4/2023 07:26

Excellent results, I think. Maybe the main point:

· Performance mostly driven by revaluation of new projects and increases in third-party revenue forecasts.

NAV 155.51 at 31/12, expected to increase by 5.5p in Q1.
2023 dividend expected to be 7.35p (5% increase).

[jonwig] 18/3/2023 17:44

Edison brief flash note:

[jonwig] 15/3/2023 06:42

Thanks, interesting article. But is the discrepancy wholly due to geography? And if so, why so stark?

[willywonka12] 14/3/2023 22:26

hxxps://www.energy-storage.news/gore-street-and-gresham-house-funds-grow-nav-per-share-in-2022-by-contrasting-rates/

[nickrl] 13/3/2023 14:29

@marktime they say nothing that BESS revenues collapsing in Q1 and with more units entering the market its getting saturated. Also quite frankly as rates were very high during 2022 it compensated for lack of commissioned sites.

[marktime1231] 13/3/2023 13:41

Well that trading update, a month later than last year, confirms my worst fears. GRID no longer a runaway success story. Compare it with the trading update and outlook from Feb 2022 ...



For example Coupar Angus 40MW which they announce has only just gone live was due 22Q1. A whole year late. If you look at the pipelines then and now, starting with 425MW at the beginning of 2022 we should have had 890MW live by end 2022 and 1,127MW through 23Q1. Instead they are reporting 550MW at end 2022, 590MW now and projecting 1GW by year end. Except there must be doubt about the ongoing ability to deliver. No matter what is to blame, the plans were and are not reliable.

How this has affected revenues and ebitda, should/could have been versus actuals, is harder to say and they don't. A +20% improvement in net revenues should have been +100% or more? Financial performance to some extent saved by the bubble in energy prices to make up for terrible operational performance. For sure a huge opportunity has been missed.

A 5% dividend increase is too little too late, it reveals the weakness in financial performance. And I suspect after a terrific surge last year there is relatively modest NAV progress to look forward to from here. No longer a premium buy. Saying there is jam over the horizon. Not much to be pleased about as investors.

Out, and staying out.

[speedsgh] 13/3/2023 08:43

Trading Update -

~ Over 20% like-for-like growth in underlying portfolio EBITDA in 2022

~ Significant increase in expected operating capacity to 1GW in 2023 to drive growth in NAV and EBITDA

----------------------

2022 highlights

§ Full year EBITDA of the underlying portfolio exceeded £48mn, a like-for-like increase of over 20%.

§ 7p dividend to be paid in respect of 2022, covered 1.3x.

§ 155.5p per share unaudited NAV as of 31 December 2022 (31 December 2021: 116.86p).

§ Unaudited NAV total return of 39.1% in 2022 and 93.2% since IPO, representing an annualised return of 17.2%.

[continues]


----------------------

2023 outlook

§ Q1 NAV per share to benefit from incremental project revaluations of +3.3p.

§ Operational capacity is expected to reach 1GW in 2023 and around 1.5GW in 2024, representing growth of 80% and 170% respectively compared to capacity as of 31 December 2022. This is expected to drive NAV and EBITDA growth.

§ In light of the growth in EBITDA from increased operational capacity in 2022 and expected in 2023, the Board intends to pay a dividend of 7.35p per share for 2023, a 5% increase over 2022. The Board will periodically review the dividend policy to maintain a competitive dividend yield while also ensuring that dividend cover remains strong.

[marktime1231] 28/2/2023 15:48

The stagnant dividend and the doubts I expressed about execution and management have been gnawing at me, the premium no longer looks justified. I decided to crystalise gains this afternoon. GRID could excel again so good luck to those of you with the nerve to hold on.

[davebowler] 28/2/2023 10:29

htTPs://www.edisongroup.com/research/powering-on/31990/

[jonwig] 25/2/2023 11:05

The slowness to get grid connections is very real, the FT covered it recently, in addition to Edison highlighting it above.

Renewables groups sound alarm over UK grid connection delays
Solar, wind and battery storage developers say 13-year wait threatens investment and Britain’s net zero goals.



[I think if you copy the above text into a search box, you can bypass the paywall.]

[marktime1231] 25/2/2023 10:51

Puzzled by last year's jiggery pokery with the dividend timetable, at Christmas I wrote to Ben Guest accusing him of squeezing up NAV as part of planning for another big fund raising issue, something I had guessed had been imminent when the share price broke through 175p in September - that was my rough calculation of the point where a share issue was more economic than debt funding. Only for the market to take a sharp knock courtesy of Truss-Kwarteng and GRID subsequently announced £155M debt extension instead.

A blustering denial of course. But I am sure that was the game.

I also challenged him on project delays, was it really all down to waiting for grid connections, noting Harmony had just announced the commissioning of Pillswood claiming it was ahead of schedule. The GRID "NAV report" in early November was also a performance summary to end September except that details such as the portfolio status had been put in a separate Fact Sheet published at the same time. It confirmed my suspicions that there was slippage, and a bit of desperation eg putting things in the "live" column but with a note "in commissioning". A contrast to the bullish trading statements and outlook we have been treated to up until now.

Edison too have picked up on the slippages. By my reckoning 300-400MW which should have been energised by 2023 Q1 according to original plans at the time of fund raising or project acquisition is already late or will be very soon. Through a winter of extreme pressure on the grid, eg National Grid ESO paying households to switch off 4-7pm, and yet sometimes having to curtail surplus wind generation. I challenged Ben Guest to provide a transparent report and to reset the timetable to something investors can rely on.

Again more blustery denial, it was all other people's fault and they were working hard on getting connections. And yet the delays also come with increased delivery costs, at our expense, so it is not all or just third party problems. Never mind the loss of income.

So it was a bit telling that the 10 February announcement of yet another flat dividend came without a NAV or trading update. No announcements of sites being commissioned, the size of the ones overdue would represent a material increase to income and so worthy of an individual rns. Silence. Not at all like the bull story we have come to expect.

My conclusion is that GRIDs shifting strategy from acquiring live sites to acquiring earlier stage projects, in order to squeeze out more NAV gains, has backfired. They have not managed the execution risk well. An asset manager behaving like an asset manager rather than an income investment trust manager. Their fees are not suffering it is our income which is suffering.

The exceptional energy market situation and more aggressive asset-optimisation has probably saved the day, compensating for the lack of MWh versus plan. Here for example is how hard some of GRIDs smaller sites are working ...



... a splendid tracker of how UK BESS sites are performing. These smart people recently did their own analysis of GRID on twitter and concluded things are looking trickier.

The chance remains of course for GRID to put out a super report on 2022 and progress since, something we might expect to get in early April. Or they might wait a bit longer until there is really positive headline news. Funding remains healthy, they might have managed to complete some projects, new opportunities are available, etc. But I think NAV progress may have stalled and the missed surplus income opportunity means we might have to endure a flat or weakly improving divided. The future should still be bright but the current loss of momentum suggests a 10% premium over NAV-as-at-Sep-2022 is looking rich.

Should we give GRID a chance and wait for a report in April or should we take some profits if the share price rises to meet ex-div next Thursday?

[nickrl] 25/2/2023 10:14

@erstwhile2 thanks for posting that link very interesting. Batteries will come back into play as spring and summer come and renewables have a higher penetration as the ESO will need more frequency response services to manage the variable output.

[jonwig] 25/2/2023 08:20

Edison note published yesterday:

[spangle93] 10/2/2023 11:23

2021 Results were out early April in 2022

Wonder if there will be scope to increase the yield to make it more attractive?

This is what was said in the interims
"The Board reaffirms a target dividend of 7.0p for 2022 and expects full Operational Dividend Cover for the full year. The Company will balance future dividend target levels with increases in Operational Dividend Cover