Member Info for StarBright

Thank you for that link, @clissold345

I have seen Evolution highlighted previously as potential acquirors of Telfer. Here’s an example https://youtu.be/t8eiqQ4nWjo?si=I9KuhTa3ehFVdSWW (somewhere around the 44min mark)

What prompted you to mention them here/today @aim999?

@Hydrogen has a different view. He says up to around 10MTpa from Havieron SLOS: https://www.ggpchat.co.uk/viewtopic.php?p=4380#p4380

“I've been in conversation with a few people about why Havieron SLOS is capable of up to around 10MT PA, as some think its unlikely. (this obviously excludes the block cave)

As a consequence, I decided to work a calculation through, for the benefit of myself and other holders, who would like a better understanding of the potential numbers. in the process I've asked an experienced gold miner to assist with my calculations.

The long SLOS ore stopes of Havierorn should be huge - around 60 to 90m long ( I'm not certain as to the exact volume but something like 90m x 4.5m x 5m or wider) sections, blasted as a cut, say once a week.

Once the dust settles, these are cleared and mucked out by 20 tonne Sandvik underground shovel loaders to a dedicated ore pass ( ore drop) into automated skips and loaded into the hoist. Multiple Stopes would be worked at once to produce 21,000-23,000 tonne. The rest is loaded into a fleet of approximately 10-20 x 20t or 40t (TBC) Sandvik underground haul trucks, travelling 6-7km round trip up the decline to the surface ROM pad.“

@SpadesAspade - if Hav is worth USD1.2bn then doesn’t GGP have to raise $840m to buy the remaining 70%? GGP will also have to find 100% of the capital to fund the mine into production, not the 30% it was previously on the hook for.

That’s a lot of money to find. MUCH more than the USD350m you mention.

How can you be confident that SD can raise that sort of money (remember that additional debt without additional equity is a pipe dream) without materially diluting existing holders?

A material raise via ASX listing seems likely. When push comes to shove (ie when the placing price is being set) will SD fight for the rights of his loyal band of UK PI’s? Or will he focus on the interests of his new equity providers…? Remember which group will determine his remuneration, equity incentivisation and career prospects going forward.

THAT is the question.

@Ninetopprizesof - I’ve looked at the text in auditor’s report regarding intercompany balances. It says “ Intragroup balances are significant assets in the parent company’s financial statements. Their recoverability is directly linked to the carrying value of intangible assets in the form of mine development assets in the subsidiaries and the ability of those assets to produce sufficient returns in order to repay the loans. There is a risk that the loans may not be fully recoverable and the value of the loans are overstated. The recovery of the intragroup balances and accompanying assessment for expected credit losses under IFRS 9 – Financial Instruments requires significant estimation and judgement, and therefore this has been assessed as a Key Audit Matter.”

This is a standard wording that you’ll find in many auditors reports where the development of an asset is funded through “loans” made to a subsidiary company. In simple terms the (UK) GGP parent company has raised capital via placings etc that it has advanced to the Aus subsidiary that is the JV contracting entity in order to pay GGP’s share of the mine development costs. If the mine never reaches profitable operation, then the intercompany loan would have to be written down - as the asset would be impaired in value.

This is just normal accounting. There is NOTHING in the report to suggest that “IFRS expectations” (to use your phrase) aren’t being met. The auditors are saying that they have carried out an assessment and agree with the accounting treatment.

Readers here should disregard your suggestion of associated irregularity. Whether your mistaken inference is a result of your lack of understanding or mischief-making, readers can judge for themselves…

Thank you for that @Ninetopprizesof.

A while ago you invited readers to examine GGP’s AoA, suggesting that there are perhaps specific provisions therein that interested parties should be aware of given discussion of listing venues. I took a look, but couldn’t see anything particularly unusual/noteworthy. Can you point us in the right direction?

“Zioc to be under offer by end of the week” - where/when did you see that?

Blackrock now hold a little over 10% in terms of voting rights, having added another 2.5%. Holding is a mixture of shares (7.3%) and some other instrument.

I don’t see (but I may have missed something…) any particular reason that this increase would be driven by index-related changes or inflows. Therefore it is possible that this is true discretionary buying by a Blackrock actively managed fund (or funds). We may get a little more info when fund annual/interim reports are released.

Interesting development if it is buying by an active fund…

Looks good to me.

Recent portfolio acquisitions in France and here in the UK have had reported initial yields of 6.3% and 7.5% respectively. At the same time SUPR has been able to raise finance at 4.44% fixed and SONIA+1.55%. Good business!

“The Company has signed and completed an agreement with a group of institutional investors for a private placement of €83 million of new senior unsecured notes (the "Notes"). The Notes have a maturity of seven years and a fixed rate coupon of 4.44%.”

@Jerryspaniel is correct that there are structural reasons why an ASX listing will likely encourage Australian insto investors to engage and commit. This includes gaining access to the large pool of domestic indexed and “benchmark-aware” assets, as well as to the mining-enthusiastic active investment funds.

SD has the opportunity to action the long touted ASX-listing at a moment when additional capital is going to be needed to fund the acquisition and development of the 100%. It’s highly unlikely that GGP will be able to raise additional debt financing without at least scaling up equity capital in lockstep.

Such a listing will also allow him to secure a personal milestone in that he’ll be the CEO of an ASX-listed mining company.

My view is that any deal for the 100% will announced in tandem with an ASX-listing of new shares underwritten by existing and new Aussie insto investors. How these two transactions are structured and priced will determine the outcome for GGP’s existing equity holders.

A low acquisition price (perhaps benefitting somehow from the inclusion of Telfer and some form of prospective royalties) combined with an over-subscribed ASX raise from eager institutions keen to participate is the best outcome for existing holders.

The answer is straightforward - GSF doesn’t have the cash / cashflow to fund a buyback programme.

They’ve considered but rejected the idea of buybacks in the same way that I have considered but rejected the idea of marrying Shakira.

Listening carefully to what the company is telling us, I think the unwelcome dividend phasing reflects uncertainty around the timing of receipt of the “ITC” proceeds in the US.

From page 28 of the annual results:

“Both construction assets in the US, for example, offer a potential combined benefit of $60 million to $80 million to the Company through the sale of ITCs for which they are eligible, and we are exploring opportunities to deliver this value to shareholders.”

IF they complete the construction/energisation of the US assets in time [they continue to express reasonable confidence on this] AND they are able to receive or otherwise monetise the associated $60-$80m of ITC’s, then they will be able to fund a bumper “final” divi in a year’s time. Following this they MAY have sufficient+regular operational free cashflow to sustain a more evenly phased dividend schedule, hopefully >7p in total. At this point, with a divi properly covered by recurring cashflow I think there’s potential for a material re-rate.

But if - for whatever reason, including post-election political risk in the US - they can’t secure receipt of the ITC cash in time for the “final” divi then they’ll have to re-cut their cloth accordingly.

So holders today are effectively shouldering this risk. If it’s just a timing risk then I can live with it. If it becomes more than a question of timing then the situation is changed.

DYOR etc….

Yup. It’ll be interesting to see how the market reacts to the presentations scheduled for today. These give the company an opportunity to set out its thinking and plans with respect to the divi.

——-

Results Presentation Today

There will be a presentation for sell-side analysts at 9.30 a.m. today, 15 July 2024. Please contact Buchanan for details on gorestreet@buchanancomms.co.uk

A presentation for investors will also be held today, 15 July 2024, on the Investor Meets Company Platform at 11:00 a.m.

Investors can sign up to Investor Meet Company for free and add to meet GORE STREET ENERGY STORAGE FUND PLC via: https://www.investormeetcompany.com/gore-street-energy-storage-fund-plc/register-investor

They are breaking the link between the so-called NAV and the dividend, in favour of better aligning the dividend with cash generation. To me this makes total sense - you can/should only distribute your free cashflow. It’s a point I have made to the Chair/board in correspondence; they won’t have changed because of me(!) so other/larger investors must have been bringing similar pressure to bear.

The positive is that this deals with dividend sustainability. The company will no longer distribute cash it hasn’t earned. So some of the questions that have been out there for a while appear to have been addressed. That said, if they are targeting 7p, I don’t understand why they didn’t go for 3x1.5p + a final distribution. I’m not sure the shape they’ve chosen will be well received. And I would have like to see them commit more clearly to distributing a % (say 80%?) of free cashflow as a minimum.

So a step in the right direction but not without risk in terms of market reaction.

Fair!

Here’s the latest:

“We would like to inform you that the recent meeting invitation that you received for NEXTENERGY SOLAR FUND LIMITED was created and released by us in error . This was due to a scheduling oversight within our team and not issued by the company.

We apologise for any confusion or inconvenience this may have caused.

The team at Investor Meet Company

Latest: We would like to inform you that the recent meeting invitation that you received for NEXTENERGY SOLAR FUND LIMITED was created and released by us in error . This was due to a scheduling oversight within our team and not issued by the company.

We apologise for any confusion or inconvenience this may have caused.

The team at Investor Meet Company”

I wonder why…?

It will be interesting to see if the results themselves are delayed. It’s not normal for well-managed businesses to do this. Either careless or news is brewing….

——

Please be advised that NEXTENERGY SOLAR FUND LIMITED is rescheduling the presentation:

Full Year Results - originally scheduled for 17 Jul 2024, 09:00 BST.

A further presentation invitation will be issued in due course.

We apologise for any inconvenience caused.

To help investors the company should only include revenue-generating assets in what it terms “Operational Capacity”.

It seems that “energised” happens before “operational”, and that “operational” happens before “pre-commercial” which in turn happens before “revenue generation”…

- In the January factsheet “Operational Capacity” was reported as 372MW

- In February as 421MW with a footnote stating “Includes 50 MW newly energised capacity at Ferrymuir.”

- By May the footnote read “Includes 50 MW energised, pre-commercial capacity at Ferrymuir.”

- Only in June do all of the footnotes disappear, and we are told in commentary that “The Company’s Ferrymuir asset entered into commercial operations following commencement of revenue generation in June.”

As I’ve said previously, GSF is guilty of being too cute at times with definitions. I think this reflects poorly upon them, and they should change their approach.

Https://www.gsenergystoragefund.com/docs/librariesprovider22/archive/gsf_factsheet_june_2024.pdf

“The 49.9 MW Ferrymuir asset in Great Britain (GB) began generating revenue, joining the Company’s fleet of commercially operational assets.”

They’ve been fudging the definition of operational on this for a while, so good to see it is finally generating revenue - surely the only meaningful definition!

Analyst (RBC) report out today is behind the move, I think.

https://www.proactiveinvestors.co.uk/companies/news/1051240/ibstock-and-forterra-tipped-for-post-election-housing-boost-1051240.html