DAVY VIEW

Corre Energy’s interim results reflect the funding and operational challenges facing the business. Firstly, its reported cash position at the end of H1 was €0.3m, while trade and tax payables totalled €5.3m. Subsequent to the balance sheet date, it received the final €1.1m proceeds from its H1 equity raised (July) and put in place a €5m loan facility (August). Secondly, the company has provided an update on key projects. Delayed timelines and a more challenging economic returns outlook are likely to materially reduce the net present value of key compressed air energy storage projects in our own financial model. Finally, while the statement notes strong investor interest, it also states that “the financial issues disclosed to the market in August and the subsequent operational and strategic reviews” have delayed the likely completion of its strategic investment process. In light of today’s update, and resulting delays to project development as well as funding clarity, we must consider the broader implications for our own Corre Energy investment case.