Member Info for Douvrey

Svend - Many thanks for taking the time to explain that to me. I don't presently own shares, but first got interested when it was ~350p.

I had understood from an IC article that Vistry had plenty of assets, but little cash. I assumed that cash could be raised, albeit expensively, in order to get it to 3 months or so after the contract awards from the Government by autumn. This present short selling action raises the suspicion that the Schonfelds etc think that there's a chance they don't make that. It's hard to see HMG let a partner go to the wall over a temporary embarrassment - especially one which is highlighted by prominent ministers like Reeves, Raynor, etc..

The IC thought that cash could be raised by selling land etc, but that this would affect their ability to build homes. However even that they are moving to a 100% partnership model, where I read the partner supplies the land and the cash to build, would that really be a big deal? I did wonder the I saw the invitation to take redundancy, whether that was a crack. Will keep a watching brief for now.

Again, many thanks.

I was surprised to learn that the major shareholders were hedge funds. They generally operate on a shorter time frame loaded with debt. However, from what's being reported, these ones seem interested in the long term with Vistry. I'd love to know what they bought in at - I can't find that anywhere. I have to say, when I read this I did wonder who exactly was doing the shorting.

I found this in my search for information about the scheme. I found it helpful in trying to understand what these things are.

https://www.investegate.co.uk/announcement/rns/nextenergy-solar-fund-limited-red--nesf/issue-of-preference-shares/5558241

I'm really grateful to Jerry and TimBob for their explanations as how this works. I hadn't really thought about it when I bought in, but NESF's recent adversity has piqued my interest. B-shares are an unusual thing, in that they carry the same dividend as ordinary shares, rank as ordinary shares, but don't have voting rights. I'd say that this militates against them being redeemed as B shares. Also, what would they then do with them? They couldn't realistically sell them as it would crash the price they could achieve. Am I right in thinking that, in theory, redemption needn't impact upon share price it there would be an commensurate drop in debt - and ironically this would improve total NAV, though not NAV/share?

Not entirely sure on how to categorise this as a risk going forward, but I'm thinking that it's not really a problems as it should take care of itself?

Thanks again.

For those with a subscription to Investors Chronicle, their columnist Mr BearBull has written positively about the share.

Suspect this is aimed at the institutional investor, rather than retail who seem to be putting in a 45-50p floor. He needs to be seen as decisive if he’s to stand a chance with them. Danger of course is that he’s deserted by both. QV I think he may have done the only thing he could do - return the business to looking like a business as opposed to an annuity. Who knows, we may even see some growth - especially now as events prove the power price gurus, once again, to be wrong.

Https://renewablesnow.com/news/nesf-sells-100-mw-uk-solar-portfolio-to-atrato-onsite-energy-1291124/

I think it just goes to show how ridiculous it is to place so much importance upon power price estimates.

Sorry. I was meaning the new licences shortly to be on offer.

Who is going to bid on these? None of the present players in the sector have the cash to do so. Are there others out there looking to get in? If yes, why haven’t they bought the existing companies at these discounts? I don’t understand.

The second scenario is, I think, reasonably fair. If you look at the UK electricity price over the last decade then the price today is higher than any price pre-pandemic. Post pandemic was admittedly nuts, but it looks like we are settling into a reasonably stable, barely rising, picture. Pandemic aside, a reasonable view is that broadly, where we are can be expected to persist in the future.

As for growth, I think we will remain in run off mode until the politics changes. Renewable companies will only return to growth if there is confidence that the policy will be seen through by HMG. The political attacks on the sector from across the Pond are something to behold. It is now being ramped up by the NSS document produced by the Americans, who appear to be advocating for a Reform government here. There is a question as to what they could actually do in what I imagine would be a one term government, but their election is a risk we can't ignore. I doubt it will actually happen.

Finally, if the recession ever actually arrives then there may be a period where a stable dividend is prized once more, giving holders an opportunity to consider how much exposure they are comfortable with.

Pleased that they included a bit on up-coming projects. That’s a welcome sign of confidence. A buy back might also be sensible here. Went through a period there when I was sure something awful was coming - but think we’re passed that now. Let’s hope so.

There is no doubting that this appointment is a step change for the better. I'm not sure that there will be an immediate improvement in share price, but a reassurance that progress can be made and that the business will continue on would be more than enough for me.

The “problem” is that no investment they could make would be as profitable as buying back their own shares. I think much of the problem for the industry is the belief of “energy price forecast” experts that power prices will only go down, when in reality they have only gone up for decades - albeit mildly.

It’s odd. The govt wants to make the switch to renewables and the companies who are there to benefit by providing it think obsessing about their structure is the path to success.

Zebbo, many thanks for this. I’m particularly pleased by he recognition that govt policy will have to be taken advantage of.

My PoV is that recession is in the post and interest rates will come down. Should that prove right then there should be a bit of a bounce and I’ll review then. Not advice and best of luck to you.

I remember there being talk that it might, but it didn’t - I think it was the last placed share in the index.

It’s not going to help, but I do wonder how much damage it will do. Many institutional investors sold in the last couple of years. It’s been retail who bought. That’s why you get strange reports of 13% of shareholders voting to wind it up who represent 7% of share capital - its folk who misread the material - or can’t be bothered to, and who click yes to everything. The proportion of retail investors is encouraging, I think. They tend not to follow every twist in turn and buy for the long term.

At present it won’t grow. There’s little point in investing in infrastructure which will then be subject to a significant discount as per the share price. That’s true of all renewable producers. Against that you have increasing energy demand from things such as AI, and a government committed to renewable energy and no expertise in building capacity. Any increase in capacity will have to be delivered by experts, and likely the people who are delivering it now. That has to be made commercially attractive. I imagine that will be part of any review going forward. They aren’t going bust. Capacity is being maintained, and a very large dividend is being paid.

Missed that. Thanks for posting. Increasingly looks like our energy policy is being made on the hoof.