Gore Street Energy Storage Fund PLC (LSE:GSF) reported a net asset value (NAV) of 102.8p per share for the quarter ending June 30, 2025, unchanged from the previous period, as ongoing operational challenges continued to limit dividend coverage.
The company’s quarterly results revealed that an uncovered dividend reduced NAV by 0.8p per share, which was largely offset by positive adjustments in valuation assumptions, adding 0.9p per share.
Operational performance remained subdued, with net cash generation totaling just £1 million after accounting for debt and fund expenses. Dividend coverage for the quarter fell to around 0.2 times, a notable drop from the 0.42 times recorded for fiscal year 2025, despite a reduced quarterly payout of 1p per share.
The weaker performance was mainly linked to difficulties in the Texas (ERCOT) market, though a modest rebound in the third quarter is expected as operational capacity ramps up.
Gore Street’s shares are trading at a 41% discount to NAV, wider than the renewable energy peer group average of approximately 29%.
At the end of the quarter, the company reported net debt of £70.5 million, including £51.4 million in cash against £121.9 million in debt, with an additional £42.9 million of borrowing headroom. Net debt has since fallen to £64 million following the receipt of the first tranche of U.S. investment tax credits (ITCs).
The fund reiterated its fiscal year 2026 dividend guidance of 2.25p per share following the reduction announced in July. Gore Street also expects to pay a 3p per share special dividend in H2 2025 after realizing proceeds from the sale of U.S. ITCs.
The portfolio is now fully operational, with the DogFish and Big Enderby projects coming online after reporting delays had previously affected 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 total portfolio. The company reported approximately 20% outperformance relative to Modo benchmarks across the optimized assets.
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