Gresham House Energy Sto... Share Discussion Threads

[spectoacc] 19/4/2024 08:02

Surely more a case of on 1st Feb, removing the divi but using that amount for buybacks.

Subsequent to that, with a further month of cr*ppy pricing in Feb, the buyback is done and now it's on to capital preservation.


"....The commencement of a Share Buyback Programme. The Company will review the Share Buyback Programme on an ongoing basis in the context of its capital allocation decisions, as well as the discount to NAV at which the shares are trading at any given time." [2nd Feb]


Edit - could do with some decent director buying, averaging down their small buys from c.50p.

[willywonka12] 19/4/2024 08:02

I have loss confidence in the management. And so as everyone else .They better come up good news today .

[jpatara3] 19/4/2024 07:50

Same occurred to me - buybacks v preserving cash!! Maybe they will explain it today in the 11am call

[jimbox1] 19/4/2024 07:44

If the priority is deleveraging and preserving cash for current constructions, why was the company continuing to buy back shares until yesterday? Did this only become a priority last night?

[cc2014] 19/4/2024 07:43

I think the situation is now as follows for the UK:

GRID, HEIT and GSF complete all projects which are under construction meaning a bunch of new batteries come on line between now and October

And that will be it. These funds are not ever going to raise any more capital and any expansion of batteries in the UK is going to be down to others. There's plenty in the pipeline for the "others" just as there is for GRID/HEIT and GSF but I doubt even a fraction of it will get built now. The cost/benefit analysis has changed.

So, if the ESO want batteries on the GRID and a progression to net zero the price incentives are going to have to change. I suspect that won't happen, low volumes of new batteries will come online after October and income will start whipsawing back the other way about a year later.

Anyway, my view is of course that of someone now sitting in a losing trade and writing a bull case for the future. My average is 43.4p so not a million miles away from breakeven but I suspect I'm stuck here for a while unless I take a loss.

[spectoacc] 19/4/2024 05:43

I won't be a holder of HEIT at any price, but I'm comfortable in GRID & GSF. RNS read well to me.

They've recognised the market isn't out of the woods yet, and are prioritising cash/paying down debt. Yes, I like GSF's huge yield, but there's no way they weren't heavily effected by the Jan/Feb UK market (at least a third, arguably 40%, of GSF). But still too cheap to ignore.

GSF will be paying out some of their NAV, GRID will effectively be accruing it.

NAV's a moveable feast, but consider HEIT/GRID are more or less in the same market, and compare those RNS's.

[dickiehhh] 18/4/2024 20:16

Agreed - it's a terrible piece of market communication. And sadly that reflects badly on the management. By contrast HEIT did communicate much better the increase in revenues observed in the last two months from BESS which surely does also benefit GRID's assets.

[marktime1231] 18/4/2024 16:13

What is the point of a trading update that tells you nothing about how they have been trading, what a contrast to other reports. Where are the facts, the data, the metrics? All about assets and nothing hard about trading. Grrrrrrr.

B hell, I feel duped by the HEIT report. If only I had listened to myself and waited what turned out to be about an hour for a report before speculating. The quickest flush in my chequered history.

[masurenguy] 18/4/2024 15:40

Unaudited NAV per share of 129p compared to the current shareprice of 38p. Crazy !
No position, just monitoring.

[cousinit] 18/4/2024 14:27

Does feel like this is akin to DGI9 in that there is nothing to act as a floor under the price as there is nothing remotely 'jam today' it's all tomorrow. And into 2025 as a minimum. It's not even like they are hoisting the 'for sale' sign with a strategic review.

I hold a small amount bought after the fall back from the 60s into 40s.

[jpatara3] 18/4/2024 14:17

Like GRID buybacks I am also mopping up as the price drops, because;The world doesn't have the infrastructure (electricity) to support AI power consumption. The international Energy Agency has estimated the AI industry is going to consume 10x the power demand of 2023 by 2026. Generative AI systems are hugely power intensive, involves crunching of enormous volumes of data and that requires a lot of energy to do. Questions are being asked do we have enough electricity to go around. Connecting the AI facilities to power networks, making sure all the transmission lines are in place. This requires more infrastructure, which takes time to put in place. ... in summary we need more clean energy to meet medium to long term demands that are coming. Battery Storage will play a big part in this infrastructure.

[george stobart] 18/4/2024 13:16

Disaster RNS just out.

Share price heading towards 20p, non-stop

[spectoacc] 18/4/2024 12:58

T/s out, a lot in there but is generally OK IMO, albeit:

"As capital allocation is focused on cash preservation and debt reduction and given the challenging recent revenue environment, the Board does not currently expect to pay any dividends or carry out further share buybacks in 2024."


NAV down, but still very significantly higher than s/p.

[marktime1231] 18/4/2024 11:57

Healthy transparency from HEIT about some of its income performance, but could not quite bring themselves to spell out what seems like the dividend remains suspended for another quarter and policy will be reset for H2.

HEIT got a good 10% kick up this morning and GRID has yet to follow suit. Took another nibble assuming GRID will emulate HEITs trading update in due course.

[igoe104] 18/4/2024 08:51

Can't understand why folks are still selling at these levels, when you can clearly see things are improving.

[cc2014] 18/4/2024 08:22

I draw the conclusion that the market has completely lost the plot.

[cruelladeville] 18/4/2024 08:05

No share price bounce here in sympathy with HEIT?

[marktime1231] 17/4/2024 16:23

Actually we are promised an update to the dividend policy on or before FY23 results, which were expected by 6 April but in any case sometime "in April".

You have persuaded me cc, took a small bite on share price weakness today.

[willywonka12] 17/4/2024 15:44

The next declaration of dividend is 5th of May should get result before then

[cc2014] 17/4/2024 07:57

The BESS index has risen from a low of about £15k/MW/yr when Jefferies wrote that article about 6-8 weeks ago to £82k/MW/yr yesterday.

Whist this has been going on the price of gas which drives the marginal price of electricity has also risen by 45%.

And yet the reaction in the share price of GSF/GRID and HEIT is that they have fallen more. OK, I get some of it is due to gilts rising and therefore pressure on the NAV due to the discount rate calculation but in the real world the revenues have changed by an order of magnitude.

[nickrl] 16/4/2024 16:02

@marktime im trying to guestimate stating the total revenue from assets with a T-1/4 in the 23/24 delivery year. On the T-1 (23/24) and applying the derating factor means its worth c£12/MW/delivery year but given only half the assets have a CM then its near £5-6/MW across the whole portfolio.

As i say its basically free money from filling in a prequalification questionnaire as long as you deliver when called upon (so far the ESO has never instigated a capacity mkt event seem to prefer demand side mgt so its being questioned as to its value but doubt it will be dropped especially T-4 as its key to driving new construction generation).

[marktime1231] 16/4/2024 12:58

Thank you for that effort nickrl, very useful, your "quite unwieldy" comment had me chuckling. To summarise your summary you are saying CM adds £16K - £36K / MW / yr from a mix of T-1 and T-4 auctions on a subset of assets. Across the portfolio CM adds only around 10% on top of the FR/BM revenues averaging about £50K / MW / yr. Have I got that right?

As you say welcome additional revenue but not enough to save the dividend.

An amusing sideways look at the buyback cc. By the same token if NAV is genuinely around 140p still and we are trading at 40p we should vote to test that and put everything up for sale so we can sack the manager?

For sure the big winners of future services to ESO will be larger long duration BESS assets in prime locations, development of those was the winner in recent auctions. Fortunately demand is ramping up which is why there is quite a pipeline of them, but your view that GRIDs itty bitty short duration assets will be left out is rational. Coutinho championing gas for energy security does not help.

[george stobart] 16/4/2024 11:47

According to Modo updated data, GRID live NAV is 23.72p.

If we deduct tax receivables on BESS revenue, that recently the government decided to abolish the live NAV moves to 11.69p.

Does anyone know why this stock trades at such a high premium?