Sdcl Energy Efficiency I... Share Discussion Threads

[the deacon] 05/1/2024 12:10

Recording of the recent interims presentation. Feel a little more comfortable after listening in. https://www.lsegissuerservices.com/spark/SDCLEnergyEfficiencyIncomeTrust/events/377dc565-7e7e-4b8c-a5f9-9b7df0019b82

[williamcooper104] 05/1/2024 12:04

Yep that's the one

[spectoacc] 05/1/2024 12:01

Buy low sell high ;) But can't blame you - IMO the market's been way out on interest rate cut expectations, yet SEIT has barely adjusted up like some others have. As reality dawns, bloody SEIT goes back down.

But - again - if there's no nasties, it's very cheap, and pays us to wait. Tests our patience to wait too mind.

[williamcooper104] 05/1/2024 11:56

I sold some today Losing patience

[spectoacc] 05/1/2024 11:26

It's a tough business being a SEIT shareholder - added again today (only one trade showing).

Think of the dividend, think of the dividend....

[pottsypotts] 05/1/2024 10:50

Just when I thought this share was gaining ground woosh dividend gone in a couple of days

[yump] 04/1/2024 18:17

Is that “normal” amount ?

Only the obscenity of salary levels for those supposedly at the top and so indispensible, has been sustained for such a long time, that I’m not surprised.

I mean the annual report itself must take so much stressful work, that it deserves a bonus £££ all on its own,

[spectoacc] 15/12/2023 11:12

Yikes. Thanks @SteMiS.

[stemis] 15/12/2023 10:33

Just for context, their management fee last year was £9.6 million.

[spectoacc] 15/12/2023 07:04

Overdue but good to see:

"Sustainable Development Capital LLP ("SDCL"), the Investment Manager of SDCL Energy Efficiency Income Trust plc, has acquired 1,000,000 Ordinary Shares (approx. £0.6 million) of Ordinary Shares in the Company at a price of 62 pence per share, via a wholly owned subsidiary. Following the purchase and settlement of these shares, the SDCL group owns 1,000,001 Ordinary Shares in the Company.."

[cc2014] 07/12/2023 13:36

SEIT actually seems to have found a buyer today

[stemis] 06/12/2023 15:00

I read it as the Red Rochester was valued at $314m on a net basis, which would frame the EBITDA differently. I could be wrong on this.

Imagine RR was a standalone quoted company with a market cap of $314m. To calculate the EV/Ebitda, you'd add back the debt ($75m) to the market cap ($314m) to get EV of $389m and divide by Ebitda of $14.6m.

It all looks a bit smoke and mirrors. SEIT's 'investments' are really almost all wholly owned subsidiaries. Instead of preparing consolidated accounts however, they do their own valuation of these subsidiaries based on undisclosed financial data and growth assumptions & record them on their balance sheet at that. Plenty of companies out there that, if they did that, they'd look to be trading at massive discounts to NAV.

[cc2014] 06/12/2023 13:35

yeah. It's one of those high fixed cost type assets where EBITDA on incremental earnings are high.

[williamcooper104] 06/12/2023 13:13

Sounds like they paid for a growth asset and haven't had the anticipated growth and/or growth isn't worth what it once was

[cc2014] 06/12/2023 13:03

Thanks for your post. It made me think and go and look up a few things.

I read it as the Red Rochester was valued at $314m on a net basis, which would frame the EBITDA differently. I could be wrong on this.

As at the end of September it's valued is reduced to £180m or around $225m so that's now in the price. The move seems excessively large to me and suggests my interpretation could be wrong.


Regardless of this I am fairly sure they overpaid for the assets when there was an endless stream of money coming in with new issues above NAV. Thus the bashed up share price.

[stemis] 06/12/2023 12:12

Feel free to check. The information is in the AR pages 36 and 37. Happy to be proved wrong...

[orinocor] 06/12/2023 12:05

These figures don't pass the common sense test. Do you have all the necessary information to make such statements?

[stemis] 06/12/2023 11:32

The more I look at this the more concerned I am about the valuation of their 'investments' and the allocation of capital.

I'm pointed to page 37 of the AR where the ebitda of Red Rochester is disclosed as $14.6m. The company has $75m of debt and was valued at $314m; an enterprise value of $389m or 27 x ebitda !!

In the interims they reveal the plan to spend another $75m for which the benefit, with other efficiency savings, could be $5 - 10m on NAV...

[cc2014] 04/12/2023 13:49

Results presentation here. There is nothing of import that isn't in the RNS.

[cc2014] 04/12/2023 12:18

What I really want to know is whether the $1m investment in Rondo is just a giant electric storage heater (which I have bad memories of)

[stemis] 04/12/2023 11:21

In a way the results presentation kind of reiterate my point. Lot's of talk about ebitda (whether it's up or down, meeting budget, better in the second half etc). Indeed it's mentioned 17 times. Not one figure is disclosed.

[jonwig] 04/12/2023 10:14

US best performing economy, but the US assets are the problematic ones!

They're acutely aware of the share rating, and disposals plus buybacks are clearly coming up. PIN has a tender offer recently, which might have impact here following a disposal.

Covered dividend of 6.24p should be putting a floor on the share price.

[cc2014] 04/12/2023 09:50

I have no great insight here. Nearly everything in there was pretty much flagged up already or could have been worked out through common sense.

I had hoped for better and I guess I found the results underwhelming but it seems that given the share price has not moved the market pretty much expected what it got.

It's my guess that we are at the top of this part of the interest rate cycle and we will see no further detriment to the NAV. It will be interesting to see that whilst at the moment the market is screaming at these Trusts to de-lever whether once interest rates start falling that will prove to be the right decision. I am very doubtful it can be done through disposals anyway, but that matters not to me as it will naturally happen over time as the income is more than the dividend payments.

In summary happy to hold, happy to collect the covered dividend and some capital appreciation in due course but all a but uninspiring and would have preferred the share price to zip up to 70p this morning.

[williamcooper104] 04/12/2023 09:10

Don't like the increase in holdco leverage which, that will be expensive and means as they say they need to focus on disposals to pay it down - fortunately a long way from DGI9s balance sheet - but does have some of the same colour Slightly off topic Brookfield have just raised the largest ever infra fund at $28bn That'll likely buy something that many of us hold