Next Energy Solar Fund (NESF)

[dundas666]

I have a 'half' holding so may top up in a few days when funds become available.

Also noticed from their website that they're getting into battery storage too, like GRID and GSF:
"NextEnergy Solar Fund has acquired the development rights, permits, and initial grid milestones for a 250MW portfolio of high-quality battery storage projects and grid connections."

[Gan020]

Focussing entirely on the dividend can be a value trap.

A full read of the statement reveals.

1. They can't account. A VAT error equivalent to nearly 3p of NAV. Red flag
2. The RPI forecasts going out to 2030 look excessively bullish
3. No change in the discount rate used.
4. The LTV is 45%. That's too high and raising the dividend into that sort of gearing is inappropriate, even acknologing the plan to sell some assets off.

[airbus330]

The -2.7p NAV error correction probably hasn't been well received.
https://www.proactiveinvestors.co.uk/co ... =TwitterUK

[idpickering]

I have a 'half' holding so may top up in a few days when funds become available.

Also noticed from their website that they're getting into battery storage too, like GRID and GSF:
"NextEnergy Solar Fund has acquired the development rights, permits, and initial grid milestones for a 250MW portfolio of high-quality battery storage projects and grid connections."

I noticed that thanks. I do like the fact that they're diversifying. NESF are down 4.45% as I type, which is overdone imho, but each to their own.

Ian.

[idpickering]

Scrip Reference Price.

NextEnergy Solar Fund, the specialist solar+ fund, with a combined installed power capacity of 865MW, is pleased to announce the reference price of a new Ordinary Share under the Scrip Dividend alternative for the interim dividend for the quarter ended 31 March 2023 which has been set at 114.3p. This is based upon the prevailing Net Asset Value per Ordinary Share, which was 114.3p. The final date for receiving elections on the Scrip is 2 June 2023.

https://www.investegate.co.uk/announcement/7542048

Ian.

[idpickering]

Notice of Full Year Results.

NextEnergy Solar Fund, the specialist solar+ fund, will announce its full year results for the year ended 31 March 2023 on Monday, 19 June 2023.

The Company will stream its full year results presentation via the London Stock Exchange Spark Live platform, where it is accessible to all investors and analysts. The presentation will be followed by a Q&A session, questions can also be submitted prior to the presentation via email to ir@nextenergysolarfund.com. NextEnergy Capital will endeavour to answer submitted questions during the Q&A session. If this is not possible due to time constraints, the investment adviser will follow up separately after the presentation.

https://www.investegate.co.uk/announcement/7558477

Ian (I hold).

[idpickering]

Scrip Dividend Shares - Additional Listing.

Application has been made to the London Stock Exchange for 225,838 ordinary shares to be admitted to trading. These ordinary shares are to be issued as a scrip dividend alternative to receiving a cash dividend in respect of the dividend for the fourth quarter of the Company's 2022/23 financial year. Dealings are expected to commence at 8:00 a.m. on 30 June 2023.

Immediately following Admission, the Company's issued share capital will comprise 590,480,019 ordinary shares, none of which will be held in treasury. Each ordinary share carries the right to one vote and, therefore, the total number of voting rights in the Company on Admission will be 590,480,019. This figure may be used by shareholders and other investors as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company under the FCA's Disclosure Guidance and Transparency Rules.

https://www.investegate.co.uk/announcem ... ng/7573593

Ian.

[idpickering]

Full Year Results for period ended 31 March 2023.

Financial Highlights:

Net Asset Value ("NAV") and Capital Position:

· NAV per ordinary share increased to 114.3p (31 March 2022, as reported: 113.5p).

· Ordinary shareholders' NAV increased to £674.4m (31 March 2022, as reported: £668.5m).

· Ordinary shareholder annualised total return for the year of 8.6% (31 March 2022: 11%).

· Earnings per ordinary share of 8.2p (31 March 2022: 21.7p).

· Total gearing (including preference shares) of 45% (31 March 2022: 42%).

· Weighted average cost of capital of 5.7% (31 March 2022: 5.3%).

· Weighted average discount rate of 7.3% (31 March 2022: 6.3%).

Dividend:

· Total dividend of 7.52p per ordinary share declared for the period (31 March 2022: 7.16p).

· Cash dividend cover for the period 1.4x (31 March 2023: 1.2x).

· 11% dividend target increase to 8.35p per ordinary share for the financial year ending 31 March 2024.

· Forecasted target cash dividend cover of 1.3x-1.5x, of which 1x-1.1x is from fixed revenues for the financial year ending 31 March 2024.

· Total dividends declared since IPO of £305.8m or 55.72p per share.

And later;

Interim dividends

In the absence of unforeseen circumstances, the Directors expect to declare and pay the following interim dividends per ordinary share in respect of the financial year ending 31 March 2024.

Dividend 2.09p, ex dividend 24 Aug 23, paid 30 Sep 23.

https://www.investegate.co.uk/announcem ... 23/7580159

Ian (I hold).

[idpickering]

Standalone Sustainability Report Publication.

NextEnergy Solar Fund, the specialist solar+ fund, has published its second annual Sustainability and ESG Report for the year ended 31 March 2023 (the "Report").

The Report builds on NESF's first Sustainability and ESG report published in 2022 and illustrates the breadth and depth of actions NESF has taken across the three pillars that comprise its approach to Sustainability and ESG - Biodiversity, Climate Change and Human Rights. The Report also details NESF's sustainability journey, including the development of its proprietary approach to biodiversity, the strengthening of the Board's governance and oversight of ESG, the advancement of ESG standards, and enhancement of disclosure and reporting frameworks.

NESF continues to make progress against its current ESG priorities and in spearheading sustainability and ESG initiatives within the solar, storage and investment sectors. In addition to generating enough clean electricity to power 242,000 UK homes over the year, NESF has made a wider contribution to society. This includes:

See; https://www.investegate.co.uk/announcem ... on/7654849

Ian (I hold).

[idpickering]

Interim Dividend Declaration.

NextEnergy Solar Fund, the specialist solar+ fund is pleased to announce an interim dividend of 2.08 pence per Ordinary Share for the quarter ended 30 June 2023. The interim dividend of 2.08 pence will be paid on 29 September 2023 to shareholders on the register as at the close of business on 1 September 2023. The ex-dividend date is 18 August 2023.

The Company continues to offer shareholders a Scrip Dividend alternative to this interim dividend as detailed in the Scrip Circular dated 19 July 2023, a copy of which can be viewed and / or downloaded from 'Circulars' in the Investor Relations part of the Company website (nextenergysolarfund.com). The Scrip Share reference price will be announced on 24 August 2023, with elections to be made by 1 September 2023.

https://www.investegate.co.uk/announcem ... n-/7687242

Ian (I hold).

[MickR]

With the sp now down at 94p, this is giving forward yield of over 8.8%. may have to top these up again

Mick

[idpickering]

With the sp now down at 94p, this is giving forward yield of over 8.8%. may have to top these up again

Mick

I was thinking the same Mick. Ta for your input.

Ian,

[DrFfybes]

With the sp now down at 94p, this is giving forward yield of over 8.8%. may have to top these up again

Mick

I like the yield, but it is now too high for my 'sniff test'. Once yield gets this high then generally either the market is out of step and the share price rises to bring it more into line with the FTSE average, or the market knows more than me and the divi is cut, followed by a fall in the SP. IME the latter is usually the case (DLG springs to mind as a recent one). Given their difficulties this year, and a 10 year negative capital return, 43% gearing, and the falling price of energy, it is one I'm tempted to avoid. In which case expect a 4% yield and 180p share price by Xmas.

[BullDog]

With the sp now down at 94p, this is giving forward yield of over 8.8%. may have to top these up again

Mick

I like the yield, but it is now too high for my 'sniff test'. Once yield gets this high then generally either the market is out of step and the share price rises to bring it more into line with the FTSE average, or the market knows more than me and the divi is cut, followed by a fall in the SP. IME the latter is usually the case (DLG springs to mind as a recent one). Given their difficulties this year, and a 10 year negative capital return, 43% gearing, and the falling price of energy, it is one I'm tempted to avoid. In which case expect a 4% yield and 180p share price by Xmas.

On the other hand, these stocks are rather bond like and the share price has responded badly to the interest rate rises. As the cycle turns, NESF and similar should rebound significantly and thus bring the yield more into the realms of the believable? But by not buying now, an opportunity might be lost, or not.

[idpickering]

On the other hand, these stocks are rather bond like and the share price has responded badly to the interest rate rises. As the cycle turns, NESF and similar should rebound significantly and thus bring the yield more into the realms of the believable? But by not buying now, an opportunity might be lost, or not.

That's how I read this too. My only problem in buying more NESF is that I have a 'full' holding of the share. I hold BSIF and FSFL too, both of equal capital value weighting to my NESF holdings. All were bought in the current year as I was attracted to the yields on offer from them. It's the income they were bought for and the share prices are secondary to me, although rises in their SPs would be nice too of course.

Ian.

[idpickering]

Quarterly Net Asset Value and Operational Update.

NextEnergy Solar Fund, the specialist solar+ fund, announces its unaudited Net Asset Value as at 30 June 2023, and its latest operational update.

Updates to NAV assumptions

The Company has made the following key updates to its valuation assumptions for the 30 June 2023 NAV calculation:

· An increase to the unlevered discount rate of 0.75% in response to increases to short-term base interest rates, long-term risk-free rates and macro-economic outlook.

· Updated inflation assumptions to reflect the latest available third-party inflation data from HM Treasury Forecasts and long-term implied rates from the Bank of England for its UK assets. For international assets, IMF forecasts are used.

· Updated power price forecasts capturing the latest available third-party advisor long-term power curves.

The updated NAV assumptions are disclosed in the relevant sections below.

Key Highlights:

Financial:

· Net Asset Value ("NAV") per ordinary share of 109.3p (31 March 2023: 114.3p).

· Ordinary shareholders' NAV of £645.1m (31 March 2023: £674.4m).

· Total gearing (including preference shares) of 46% (31 March 2023: 45%).

· Weighted average cost of capital of 6.2% (31 March 2023: 5.7%).

· Weighted average discount rate of 8.0% (31 March 2023: 7.3%).

Dividend:

· First interim dividend of 2.08p per ordinary share for the quarter ended 30 June 2023 (30 June 2022: 1.88p).

· Target dividend of 8.35p per ordinary share for the year ended 31 March 2024 (a year-on-year increase of 11%).

· Forecasted target dividend cover of c.1.3x - 1.5x for the financial year ending 31 March 2024.

Portfolio:

· Portfolio generation outperformance of +3.9% against budget for three months ended 30 June 2023 (30 June 2022: 4.5%).

· 99 operating solar assets (31 March 2023: 99).

· Total installed capacity of 890MW1 (31 March 2023: 889MW1).

· Remaining weighted average useful life of 26.1 years (31 March 2023: 26.3 years).

· Post period, Whitecross, a 36MW solar farm located in Lincolnshire was energised.

https://www.investegate.co.uk/announcem ... te/7700740

Div 2.08p per share, ex div today paid 29 Sep 23.

Ian (I hold).

[idpickering]

Change to Director Roles and Responsibilities.

NextEnergy Solar Fund, the specialist solar+ fund announces changes to the roles and responsibilities of the following Directors with effect from 16 August 2023, in accordance with listing rule 9.6.11.

In line with the information provided in the Notice of Annual General Meeting released on 20 July 2023, Mr Kevin Lyon has stepped down as the Chair and Non-Executive Director of the Company after serving his full nine-year tenure. The Board and the Company's Investment Adviser extends their gratitude for Mr Lyons' guidance and experience since the Company listed in 2014 and wishes him well in his future endeavours.

Ms Helen Mahy who joined the NESF Board as a Non-Executive Director and Chair Elect on the 3 April 2023 has succeeded Kevin Lyon as Chair of NESF. Ms Mahy was appointed as the new Chair of the Company with immediate effect following the Company's AGM on 16 August 2023. The Board of Directors and the Company's Investment Adviser look forward to Ms Mahy's leadership and continued support.

https://www.investegate.co.uk/announcem ... s-/7700317

nb This RNS was issued yesterday, but I missed it.

Ian.

[idpickering]

Scrip Reference Price.

NextEnergy Solar Fund, the specialist solar+ fund is pleased to announce the reference price of a new Ordinary Share under the Scrip Dividend alternative for the interim dividend for the quarter ended 30 June 2023 which has been set at 109.3 pence. This is based upon the prevailing Net Asset Value per Ordinary Share, which was 109.3p. The final date for receiving elections on the Scrip is 1 September 2023.

https://www.investegate.co.uk/announcem ... ce/7714239

Ian (I hold).

[DrFfybes]

I did a bit more looking into these, and a couple of things pop out. I could be entirely wrong and misreading things - I freely confess to not fully understanding the figures, which is why I am avoiding them

Debt - mentioned above by Gan. Interest rates are a chunk higher now, so selling off assets to pay down debt whilst handing cash to shareholders just seems poor practice.

The other things are their forward pricing contracts/valuations. From what I can see these substantially higher the ones that Toucan Energy were using prior to their re-evaluation and subsequent downfall. It may be different asset quality, or that they have fixed contracts, or I'm misunderstanding it, but I suspect come the renegotiation of the contracts the prices will fall, along with the NESF income. 50% or revenue is from Govt subsidies, but the rest looks quite high.

Their battery predictions appear to be expecting up to £150/kWh storage/annum. They predict up to 2 charge/disharge cycles per day. Yet from what I can see wholesale prices only fluctuate by up to 6p/kWh though the day, so chargin daily at the trough and selling at the peak makes that revenue nearer £20/kWh capacity/annum.

As I say, I don't fully understand their figures, and I'm sure they paid someone a lot of money to produce those pretty graphs so I assume they know what they're doing.

Paul

[daveh]

I did a bit more looking into these, and a couple of things pop out. I could be entirely wrong and misreading things - I freely confess to not fully understanding the figures, which is why I am avoiding them

Debt - mentioned above by Gan. Interest rates are a chunk higher now, so selling off assets to pay down debt whilst handing cash to shareholders just seems poor practice.

The other things are their forward pricing contracts/valuations. From what I can see these substantially higher the ones that Toucan Energy were using prior to their re-evaluation and subsequent downfall. It may be different asset quality, or that they have fixed contracts, or I'm misunderstanding it, but I suspect come the renegotiation of the contracts the prices will fall, along with the NESF income. 50% or revenue is from Govt subsidies, but the rest looks quite high.

Their battery predictions appear to be expecting up to £150/kWh storage/annum. They predict up to 2 charge/disharge cycles per day. Yet from what I can see wholesale prices only fluctuate by up to 6p/kWh though the day, so chargin daily at the trough and selling at the peak makes that revenue nearer £20/kWh capacity/annum.

As I say, I don't fully understand their figures, and I'm sure they paid someone a lot of money to produce those pretty graphs so I assume they know what they're doing.

Paul

I've seen prices varying from -£20 per MWh to £165 per MWh on Iamkate site. That's just prices I've noted there may have been bigger differences. It's worth looking at GSFs last report as they were quoting the actual prices per MWh they were making from battery storage.