Gore Street Energy Storage’s results for the year ended 31 March 2024. Most of this was covered in its trading statement published on 21 May 2024.
The year end NAV was 107p, down from 115.6p over the year. Adjustments for inflation and interest rates had an impact but the main influence on this was an adjustment to forecast revenues. The main issue is GB revenues. They are not expecting these to recover fully until 2028. The very high returns that the company is earning in Texas and California are expected to ease over time.
Much more capacity is coming on line in coming months, taking the total energised capacity to about 750MW or around 1GWh. Forecast cashflows from operating EBITDA are expected to support a 1p per quarter dividend and this is what the fund has decided to pay for the next three quarters. However, the board currently intends to pay a 4p final dividend to make 7.0p for the year, helped by the receipt of US tax credits under the Inflation Reduction Act. The company is expecting to receive $60m–80m of cash flow related to this.
7.0p compares to 7.5p paid for the year ended 31 March 2024. [It is not a huge cut, especially given what has happened to competitors’ dividends, but it does seem to have knocked the trust’s share price this morning.]
For now, cash is tight. As at 31 March 2024, the company had £60.7m in cash or cash equivalents and £58.6m in undrawn debt facilities. This will support the construction of their high priority assets (Enderby, Big Rock and Dogfish). Some projects not yet under construction may be sold.
Enderby is expected to be energised in September (target was for June) – the delay was down to the grid. The 200MW Big Rock project in California should come on stream in December. Dogfish in Texas is now scheduled for February 2025 (was December 2024). Big Rock should be able to secure a 100MW resource adequacy contract which will help underpin its revenues.
GSF : Gore Street Energy Storage cuts dividend