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Investing.com -- Gore Street Energy Storage Fund PLC (LON:GSF) on Wednesday reported a flat net asset value (NAV) of 102.8p per share for the quarter ending June 30, 2025, with weak operational performance continuing to pressure dividend coverage.
The energy storage investment company’s quarterly results showed that an uncovered dividend payment reduced NAV by 0.8p per share, which was offset by positive valuation assumption changes adding 0.9p per share.
Operational performance remained weak during the second quarter, with net cash generation of just £1 million after debt and fund costs.
This resulted in dividend coverage of approximately 0.2 times for the quarter, representing a significant decline from the 0.42 times coverage achieved in fiscal year 2025, despite a reduction in the quarterly dividend to 1p per share.
The weak performance was likely driven by challenges in the Texas (ERCOT) market, though a modest improvement is expected in the third quarter as operational capacity increases.
Gore Street’s shares currently trade at a 41% discount to the reported NAV, compared to the renewable peer group average discount of approximately 29%.
The company reported net debt of £70.5 million at quarter end, comprising £51.4 million in cash and £121.9 million in debt, with an additional £42.9 million of headroom available on its debt facilities. Net debt has since decreased to £64 million following the receipt of the first investment tax credits (ITCs).
Gore Street maintained its fiscal year 2026 dividend guidance of 2.25p per share following a cut announced in July. The company still plans to pay a 3p per share special dividend in the second half of calendar year 2025 after receiving funds from the sale of US ITCs.
The company’s funded portfolio is now fully energized, with DogFish and Big Enderby projects becoming operational after the reporting period following construction delays that impacted NAV by 0.4p per share.
In-house asset optimization has been extended to three ERCOT assets, with optimized capacity now representing 28% of the overall portfolio. The company reported approximately 20% total outperformance over Modo benchmarks.
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