Member Info for mister_tidal

Ah, I confused Total Liabilities with Debt here.

@Blonnyman I assume we have to take the "Long Term Debt" from last year, which was £44.6m which would give a ratio of 87.87/44.6 = 1.97 in 2021 (data according to marketwatch.com).

If I am not mistaken, then they already received £6m for BESS (https://simecatlantis.com/sae-achieves-milestone-in-bess-project-delivery)? This would give us 87.87/38.6 = 2.28 which is, perhaps, what they are referring to?

If we subtract the other £10m then we end up at 87.87/28.6 = 3.08 which means their assets should've gone up. That should have been £15.05m so

£102.92m / £28.6m = 3.6

Or is that rubbish?

It's not that I have a problem with BESS or whatever they want to do with Uskmouth. My problem is that they have zero cash. This means they always have to take on debt. For anything they do. That means that their ROI is always going to suffer and that's something they can hardly afford now that they are buried in debt.

I'm not complaining seeing them trying to make the best of what they got. I'm not even blaming them (except for their ****ty comms). It's just from a shareholder's perspective it's tiresome.

Oh and regarding the MeyGen participation.. well yeah, of course they are invited to the party but I fail to see how they will be able to secure anything.

They were always convinced they can secure something and never did. And how are they so sure all of a sudden? They have to compete with floating offshore wind and that used to be a problem for the entire industry. So .. how?

And also why: Why is it only 52MW that are eligible for AR5 and not the remaining 270MW-something of MeyGen?

First of all, thanks for posting this and can I convince you posting stuff like this on the subreddit r/SimecAtlantisEnergy ?

Second, as nice as this sounds, there's still a few things missing imo. For starters, we've had a lot of good updates in the past so I'll remain skeptical.

Revenue does nothing for me until we know what their operating costs are. Without ATES of course it should be much lower but I'd like to know what parts of SAE are cash positive. Is it AR4? Will it be AR5 or later? I assume BESS is, I hope, but as I said in the past, I don't believe it's nearly enough to work on that debt of theirs.

Speaking of..

Maybe I am computing it wrong but according to https://www.marketwatch.com/investing/stock/smayf/financials/balance-sheet their Asset-to-Debt ratio in 2021 was 1.23

Total Assets / Total Debt = 87.87 / 71.18 = 1.23

1:3.6 would mean their Total Assets are 3.6-times their debt, right? So let's call it £60m debt which would, supposedly, mean that their total assets should blow up to £216m? That must be wrong so how do we compute that correctly?

From https://simecatlantis.com/tidal-stream/meygen

Can somebody explain to me what that means:

"MeyGen phase 3 will see the remainder of the consented project delivered. Given the award of 28MW in AR4 MeyGen has an additional consent for 52MW which is eligible to be bid into future CFD Allocation Rounds."

Especially the: "MeyGen has an additional consent for 52MW which is eligible to be bid into future CFD Allocation Rounds."-part is interesting. What does that even mean?

Oh and.. if there's that BESS argument again (sorry Strangy), then I have to disagree because I don't see how £1.3m of revenue are a significant help here.

I'm not saying that SAE might be able to re-invent intself and maybe do this or that with Uskmouth, but that's not going to be the billion £ market cap company I was hoping for.

Okay, I'll try..

Tidal_lover, the problem with your comments is not that you're not entitled to you own opinion. Having an opinion about something is absolutely fine. However, it is absolutely apparent that SAE is currently worth literally nothing. The market cap of £9m is just "noise" coming from existing shareholders like us but also a few remaining institutions who, for whatever reason, still didn't sell. Maybe it's just not the right time for them to book the losses, I have no idea, but the truth is that the stock of SAE is worth nothing for the time being.

These tiny ups and downs you see int the chart price currently comes from daytraders who agree on certain patterns. There's just a bunch of those guys (or computer programs) that make tiny trades and that moves the stock price up and down. Whenever you've seen the stock price go up a little more than usual, then it was probably just some kind of news that sill cannot produce any kind of money.

But let my try to make it even simpler for you: If you would buy SAE right now for £9m, then you'd lose money. The reason is because SAE is barely able to pay their bills and this is the simple reason why this stock is literally worth nothing right now. In fact, it's even less than nothing because the company itself is a liability at this point.

And what's so offputting on your comments is that they seem to be void of that realisation. All this is not about the share prices. It literally is just about the question whether or not there will be hundred of millions of pounds of funding for tidal stream energy and whether or not Simec Atlantis can, at some point, pull their heads out of this pile of sh..debt.

If you can write it down for me, black on white, how the revenue SAE is going to produce in the next 5, 10 or 15 years is supposed to save this company from bankruptcy then I'm all ears.

Otherwise just know that this company's share price is probably not ever going to recover in a meaningful way. Can it bounce back and could a day trader make some profit on "good news"? Sure..

But are "good news" enough to turn THIS company around? Not even in the slightest. That's going to take a lot more I'm afraid. Convince us with numbers. Not with wishful thinking.

Well, yes and no. Companies are usually hesitant about releasing too much information about certain things.

But we can derive certain things from the information that is being provided. They will tell us how much funding they needed for the next phase and we'll know how many turbines they are going to install. From that we can estimate the cost of a turbine and so on. Their next report should also indicate how much their operating cost etc went down.

In the end, however, there's no doubt in my mind that SAE needs more CfD contracts.

What I simply don't understand is why they would add £300m over 15 years and then not follow through and keep the support up. Everybody knows that £300m (or £20m per year) is absolutely nothing in this sector.

There's absolutely no doubt about the fact whether or not SAE needs (a lot) more funding in order to get anywhere with this.

But I'd like to know if my estimates are making any sense.

The assumption that AR5 will deliver £172.47m over the next 15 years, or £11.5m per year, should be reasonable. That's 43% of last year's operating expenses. These expenses should be coming down now without the ATES division.

The question now is if £11.5m/y is already enough in order to at least keep their short-term liabilities.

Each additional Megawatt deployed should deliver them £0.41m in additional revenue per year but all in all this should lead up to a price of £9.1m for an AR1500.

I want to find out where we're at.

Let me know your thoughts

This is my take on SAEs tidal business and what we should be able to expect and hope for in the future.

It's by no means a professional analysis of the company so please take it with a grain of salt and point out errors if you find one. Here you go:

https://www.reddit.com/r/SimecAtlantisEnergy/comments/100tv0v/saes_tidal_business_revenue_scenarios_after_cfd/

I'd love to carry this question over to https://www.reddit.com/r/SimecAtlantisEnergy/comments/zzrnfo/who_is_buying_saes_generated_energy_and_at_what/ but feel free to provide answers in this BB as well.

Who is buying the energy from SAE and at what price (£/MWh)?

Idk what to make out of this comment because what I just said means that there will be no SAE in 10 years if there's no governmental funding.

@keltickilla Well.. for me personally it's basically "too late" to pull out. The investment is, as far as the current share price goes, basically non-existent anymore. As I previous stated, SAE was for me a risky bet which I knew has a very high chance of going south and going south it did.

Regarding faith in the investment: Not sure where we can pull any faith from. The facts are very clear. There's either heavy governmental support and even then it's not guaranteed that tidal stream energy will succeed, or else there's literally no hope because we're talking about billions of pounds that are necessary for tidal to become truly competitive.

Hence.. I don't know where you are taking something like "When bringing the simple equation of cost v energy produced v reliability as yet there is no competition". Either I get you wrong here, but I think there's no question whether or not TSE's cost is too high (because it is by around 200 to 300% right now).

Bringing turbines at scale would require Simec Atlantis, sorry, Proteus to build a facility that would even be able to mass produce turbines at lower cost. For that there's simply no money.

There is a very good reason why SAEs market value is around £9m. As I mentioned previously.. 15% belongs to institutions.. insiders do not own anything of the company, primarily because nobody executes their stock options and the rest is distributed among us. Can't remember the exact numbers but assuming each retail investor has invested around £2000 on average this would mean that we have somewhere around 500 to 1000 retail investors.

And regarding HMG (or whoever).. No idea what their reasoning is or what the position means to their portfolio etc but in either case, you simply cannot rely on anybody in the investing space especially not when it comes to penny stocks like SAE I'd argue. SAE is soon going to need its own category "µPenny Stock" ..

This has nothing to do with negativity. It's just the facts and you'll not be able to provide anything that could change a rational mind on this. As I said previously, I don't think BESS is going to do a lot for us shareholders in terms of value. Their pile of debt is way too large and they need to cover operational cost. In the end, SAE is a comparatively simple business and I think I've educated myself enough on them to have a rather realistic picture of them by now.

Of course I still hope. Still got my shares after all. But it's going to depend primarily on governmental support and it'll take some time until this company will rise from the ashes.. if it ever will.

follow up: I was wrong about the lease. I now realized that I got their update wrong (https://simecatlantis.com/sae-signs-40m-contract-for-one-of-uks-largest-battery-storage-projects-at-uskmouth/)

"UES" is Uskmouth Energy Storage Limited which is a portfolio company of SAE.

@Strangy but, as far as I understood, BESS is going to deliver then basically approx. £40m over the next 30 years. That's £1.3m/year. Not much considering that they still have certain operational cost (tbh I don't know they Op-costs/year right now) and a whole lot of debt to pay.

Yes, I take BESS - it's better than nothing - but I just don't see how this is going to be enough in order to expand anything in tidal. Let's not forget that this is just "revenue". I don't know what this project is going to cost them aka what's even going to be left for SAEs Op-costs and debt..?

I'm so f***ing good. Did that without looking at the chart & hands free!

I can sum up what Contracts for Difference is for SAE in one sentence:

It's a horse race where every horse, except horses which are considered basicall dead, can participate and SAE is that limping, almost dead horse that very, very few people placed a bet on for.

This sentence makse no sense:

> If AR4 had been structured the way you are presuming AR5 will be then floating wind would have got everything then too.

AR4 had a ringfenced budget for tidal which is why SAE was able to secure a contract.The lack there of is why it didn't succeed in AR1, AR2 and AR3 and it's going to be why they probably won't be able to secure one in AR5.

> .. who know the policy detail and history better than we do ..

No they don't because these setups are decided and made public bei BEIS. Everyone can look into that. The only thing we don't know is what's being discussed behind closed doors but not only is it unlikely that they know something we don't know, it would be stupid af to disclose it because this would be foul play.

> " IMO still the case that writing to an MP or Ofgem is a better use of energies than this board."
Then why are you here?

> "It also seems good that the budget per MWH is up from £178 to £202."

The budget itsn't up.. the price per megawatt is down.. but I think that's what you meant to say?

> "Again, if the pot structure is what you are suggesting then I don't know why BEIS wouldn't just put out a press release saying it's all going to floating offshore wind,"

Because this is just not how CfD work? Every contender is presenting a sealed bid to the schema. The whole point of CfD is to get as much energy for the lowest price possible. Read up on what Contracts for Difference is for..

> "There's obviously both lots been done (BESS, AR4, consolidating Atlantis) and lots to do"

Well.. no... nothing happened this year. We have still only 3 out of 4 turbines in the water (major red flag). BESS.. is just literally nothing. That's a few millions for SAE that already evaporated along the way. I don't get why people don't get that BESS is just a desparate act to keep the lights on. They have no idea what else to do with their coal plant now so they rent it up..

> "Hard to imagine a worse environment for equities and especially a company with SAE's profile, but until central bank interest rate policies change.."

What!? Sure, macroeconomics always play a role to a certain degree, but besides interest rates you forget to mention BREXIT, Corona, Ukraine and 2022 in general. Interest rates surely are an issue for a company like SAE but the much, MUCH bigger problem is governmental support. They could easily decide on a tax credit to lift that weight off of SAE - this has absolutely nothing to do with interest rates.

> ".. it's hard to see what one CEO in one company is going to do."

Of course he can't change the world but he could make sure that the company is not only more transparent for investors, he should also try to make tidal stream energy more visible. This technology might work, but it has by no means proven that it is economical. They have to prove this and literally advertise for TSE.