Member Info for Mehmet66

Hitting some development milestones on Meygen will be positive. Ironically we are likely to see at least one more CFD win for subsequent phases of Meygen before financial close not to mention construction.

Near term return to water of the fourth turbine (in H1 2024) will help both as return of a full array, and an extra £1m annual revenue (assuming no other turbine comes out with it).

Overlap of interests between Meygen growth and significant SAE ownership of Proteus will start to be interesting as and when Proteus is announced as turbine manufacturer.

BESS payments being finalised, as will granting of planning consent for more BESS at Uskmouth and Meygen in coming months.

Probable end of interest rate hikes from central banks - likely in 2024 and with positive effect for all equities, especially AIM-listed small caps.

IIRC the 2022 SAE annual report concedes that recent financial position had relied on equity raises - circumstances the company would now be moving out of. We can only hope no need to raise anytime soon, and the company an obviously more attractive prospect when it does.

In conclusion the foundations are looking a lot better but there is no science for when, how, and by how much the market will begin to value that. This is not an unknown company, many will have lost handsomely in it, so patience probably a virtue for a while yet.

Minesto - An interesting company but IMO no real comparison. The fact its kite is so different to most designs in the sector does not fill me with confidence. If nothing else it will be harder for Minesto to harness economies of scale enjoyed by manufacturers with more similar designs.

I also think it will be a positive outcome. Watched the webinar for debentureholders the other day and all sounded positive. Debentureholders received steady 10% on these bonds for years and even if maturity and rolling-over would have been nice, having watched other debentures on the Abundance platform collapse, I don't think SAE performance is looked upon too badly. Also the Abundance investor base is committed to climate change action and value chance to play a role in establishing the tidal energy sector. We will see.

Recent central bank statements about decrease of interest rates in 2024 will also be helpful. The share price went from 2p to 1p on not much more than interest rate hikes.

I am aware of that. Still good news both for beyond the first 80MW of Meygen, and BESS helping Phase 1 avoid the nasty surprises plaguing connection on UK renewable generation. Support from two bits of government policy is better than one.

That's good news about no EIA. They've made some noise over the years that the Meygen substation is the only onshore impact on the landscape, so I had wondered if a whole BESS might be problematic. Also wouldn't be surprised if the existence of the BESS and extra capacity helps National Grid focus minds on any necessary grid upgrades needing expansion for Meygen. Government starting to give priority to BESS and storage would also mean the project benefits from exposure to that angle, as well as tidal support.

Anyway it is very healthy to see this taking definite steps. Seemed a year ago like it was just a nice idea that might happen.

All looks good to me.

That it's £10m now but without owning the land 31 years from now really doesn't bother me too much. Very little disappointment that it is a small amount under the £11.8m for securitising the revenue that SAE once floated, but hard to moan in current market conditions. As mentioned it is only phase 1 of the BESS and the update on a BESS at Meygen is more exciting than losing a small amount of land that was tied up for the next three decades anyway.

It is not a bad offer they are putting to Abundance investors and I guess it would be accepted, meaning no liability headaches for a long time if the vote goes as we'd want. An increase in interest payment, repayment of capital starting earlier, and incentive for SAE to repay sooner or incur higher rates, is all reassuring. Continuing to receive 10% p/a or risk your investment going into default would seem a no-brainer imo.

Nice to see some Q2 certainty on turbine 4 going back under. Think bids for next tidal auction round open in March at the new strike price, with successful bids announced early Q3, so good things up in Scotland too. Initial market reaction seems of similar view. Also happy to have RNS and Abundance comms harmonised. Increasingly professional.

Update that there has been no news on the secondary market trading suspension on Abundance. Apparently information is due to be relayed soon.

The Abundance marketplace is for debentures that have already been bought, to offer some liquidity, so it is definitely not the case that the bonds were not sold!

Secondary trading of the bonds is simple but not effortless, my guess is Abundance would not want to waste time on it if debentures are about to be paid down and closed. As has been mentioned, at times this situation would be concerning but right now, with director deals, turn into profit, and the annual report showing less concern about going concern status, I do feel more likely that it is good news, perhaps exercising right to repay the extended debentures a little earlier.

SAE clearly value the Abundance relationship and even if it has not been all plain sailing, and there were some minor delays, they have never missed an interest payment. I suspect Abundance value this and it will probably be of mutual value if SAE can tie up the outstanding debentures and then go back to the platform for a new package over 5 years as Meygen expands. I'll share more news when I get it.

Sounds good. Today's announcement of 66% increase in CfD strike price for offshore wind a promising signal also.

Don't worry Mister Tidal, maybe Tidal Lover's investment history is statistical noise and you still get lucky the once.

Glad we're all in agreement then! Only say all this too cos as well as good work by MEC and others I increasingly see things like people writing in on letters pages about tidal, and politicians aren't up to much but they do have to reply to letters from constituents. Some are lazy but some will be keen to show that they're working for you, and paying attention to what voters are concerned about - even a narrow issue like tidal energy. If investors don't want to do this thats understandable I just think a better and probably less frustrating way to use energy.

Anyway as always watch yourselves and heres hopin' more good things up ahead.

The initial RNS about Proteus was one time where info was clearly lacking and I think it good that people pestered investor relations and that SAE then replied with better info. Other than that and whatever a CEO said about monthly updates 2 years ago it is better for me (and probably also for the share price) if info is only released when it is solid, something that won't happen often because these are big and slow moving deals taking place in what is pretty much a global economic crisis. There are many things about this board that are staggering including the fact that this would be a surprise. My instinct also is that even if SAE have sometimes been imperfect with info, they are not that bad, and all the energy that goes into badgering for info that isn't yet there, from people who want the same things you do, could really be better spent badgering politicians or whoever to expand on the very small amount of support we're just starting to see return after the whole industry got dumped in 2016.

It's not that I don't want more tidal promotion, of course I do, just think there's lots of wishful thinking in the idea that some social media will 'get the word out' and then up goes the share price. Onshore wind has sky-high public approval and awareness and lowest LCOE but no turbines up in a decade. Trade bodies like MEC, devolved government in Scotland and Wales, specific targeting of MPs with specific asks is where its at imo. Repeatedly telling an investor board of people who know already about tidal (and would also like the SAE price higher!!) that the company need to do better social media just never seems like a likely path to glory but I could be wrong.

Was a solid result in AR5, and a well-worded RNS with lots of little details that had realism and confidence from details we wouldn't have been aware of. The AR5 win helping burden of higher costs since AR4 was a nice reassurance, as was news of turbine planning. Hope everyone is enjoying it.

For share price and putting aside macro conditions, we are in a position where securitisation of BESS income would leave a situation of more cash at bank than equity value of the company, so would definitely expect a rerate from that. That news is due in Q4, and I think it fair to say there is a lot of retail daytrading in SAE, but in order to catch that upswing they have to actually stay invested, so the potential for a chain of good news benefits LTHs and maybe even brings in new ones. Any news of future BESS at Uskmouth also helps.

Overall I would hope for a mixture of repayment to Abundance next year, plus some investments rolled-over, bringing in potential new funding.

As for 'pushing the brand' and stuff, and social media - forget it. Orbital have a brand in tip-top condition, and Nova say they have IPO plans but neither seem to bother with socials any more. Meygen is basically a power plant, and when did a power plant have a social media presence? It is a first-of-kind pioneer in tidal energy space, and we can hope that has a bigger impact in driving interest to SAE. Would be much more upside to have from government announcing a 2030 tidal energy target, and an improved ringfence, than a few thousand new followers online. Once again enjoy the news and hope for greater rewards to patience.

What we can expect?

As per OFGEM on AR5 - news by September 10th iirc.

As per SAE annual report:

Securitisation of BESS phase one revenue by end Q4 2023.

Financial close on Meygen Phase2 in Q2 2025. This will be financed mostly you'd expect by regular project finance, as with Phase1. Annual report suggests costs of this capital slightly better than estimated in 2021.

You'll probably get a turbine redeployment sometime in that period too, and probably at least a Phase2 of the BESS plan at Uskmouth.

Still you can always just sell-up.. markets are great right now and I'm sure you'll get strong returns in loads of other companies!

RJ and Laura,

Would add to that sensible roundup that SAE previously repaid all outstanding loans to SIMEC company, suggesting a loan facility could exist there if needed. Also Scottish Government have invested before - they probably would not want to repeat the unconventional way they did that time, but they remain a valued partner and possible source of backing.

For Abundance and whatever the rules of the platform allow, compared to other investments on it SAE may not be as unpopular with members as some. Despite the extensions, SAE have made all payments with exception of a couple that had to be delayed a month or two, they have paid new penalty rates of interest, and the tidal sector continues to move forward with the help of Meygen, which I think Abundance members value. Against the total collapses and restructuring Abundance has witnessed from some parts since Ukraine and interest rates, that might not rank too bad with investors. Will be interesting to find out.

Nobody mentioned it but the below was something that I thought interesting from annual report, in spite of rates and everything there has been a small projected *decrease* in the cost of capital for financing Meygen. This would be encouraging as it suggests a lower risk than before.

"The model is based on probability weighted sensitised cash flows using a weighted average cost of capital ranging from 8% to 10% (2021: 8% to 12%). Capital costs for the subsequent phases of the MeyGen project are based upon 3rd party quotes for the capital cost of developing the 28 MW Phase 2 array"

Welcome anyway and thanks for views. Always feels sensible for a company when a board is attracting sensible thoughts and questions. Helps keep at bay the rampers, derampers and general madness.

In response to Noisyboy's original point we can sadly expect higher opex in a year with so many turbine changes - mostly down to vessel hire. With many turbines now upgraded to same status as the one that spent years on the seafloor without issue, we can hopefully expect lower opex, and eventually many more turbines from similar opex.

On AR5 was more news today. Government increasing wind and solar budget. Tidal gets a mention which is good but only maintaining the £10m ringfence. Good that the sector is getting more attention and has clout enough to get a mention, but a smidgen disappointing not to have more money allocated in response to cost pressures.

https://www.gov.uk/government/news/energy-security-boost-with-multi-million-backing-for-renewables

All going to plan and things like £11m securitisation of BESS income, or real progress on a second project, should see some change in share price. A tough market for any share when you can get 5% in the bank, but if the near-term milestones come good then it should begin to look like good value at this price. Do think that imo another success in AR5 would also help with that.

Good to take a look back at that corner I think we might have started turning.

As a few have mentioned, very nice sentence this:

"Management’s forecasts through to 31 July 2024 anticipate revenues from trading will increasingly meet the working capital requirements of the Group."

A number of encouraging numbers in there but the key information points are just as good. Heads of Terms signed on a new BESS. Co-development of BESS. Advanced plans on a BESS at Meygen, with it obviously being recognised that that would be a whole new renewable technology type. Nothing explicit of course but it felt a bit like they were inferring something like a grant could be available for that, which is no more than you'd expect anyway.

Obviously a long way to go but it sounds like there is good focus at SAE, and in short term a number of quite well-advanced developments that as and when announced should bring a boost. Nice one everyone holding on!

Think that's unduly glum and a seems a bit like an emotional reaction, even if that's understandable.

A few things to consider:

Compared to other projects caught up in the last year of market chaos and rate hikes, BESS at Uskmouth has actually stayed pretty well on-track. Management deserves some credit though it points also to the boom in interest in UK energy storage. SAE communication through that period hasn't always been great but it is also not that bad when compared to other AIM listed companies when things aren't going great.

We'll all be waiting on the report but a few things stand out lately. The consistent delivery of news when there is news (and much of it showing steady progress) is good. The consistent RNS reassurance to shareholders is understandable when many are so down on investment, but I don't think they would be offering that reassurance at all unless on some level management think is plausible - not sure it would do any favours to do so.

If we take the statement at face value, the decision to take Turbine 4 out preemptively shows management for the future. We know for a fact that vessel hire is the main cost so that makes sense. The extensive period of works carried out recently, not just switching the one turbine, shows clear proactive site management is happening. The big thing to consider is the extent of the works done already for Meygen - the onshore cabling and substation, very big one-off costs that were already covered and with more turbines can be taken advantage of.

There are some small and encouraging signs here in a very rocky time. Put aside the 20% Proteus stake (and Uskmouth) a second and still there is a big amount of revenue potential at Meygen, but also a lot of learning being done for how to optimise this site, and maybe one day replicate it.

Maybe I'm barking up the wrong tree.. the annual report will confirm a lot, as will AR5 results. Time will tell but some signs worth consideration.

With small but broad uptick across the market in the last week, and this good news, interesting to see where the share price comes back in at. Be nice to see the last of the underside of 1p for good.

..for the trading suspension from Monday for a while? Mow the lawn, clean the house, read a book, take up a hobby? Think of all the hours! Gonna be bliss. Happy SAEholidays everyone!

It did look very fouled, which they don't normally, so hoping it's the one that's run constantly since 2018 - out for routine maintenance or whatever. Only a guess though and in some ways just as impressive if that one is still going strong - great bit of proof of industry reliability.