Corre Energy, the Dublin-listed renewable energy storage developer, said it is looking at going to shareholders to raise cash to fund its short-term needs as it continues to talk to third parties that have signalled an interest in making a “strategic investment” in the company.
The Irish-run but Dutch-based business revealed in its full-year results statement for 2023 on Tuesday that it had €1.08 million cash at the end of last year, down from €3.43 million a year earlier. The company also raised €18.9 million of funding last year, including equity and loans.
“The company intends to engage with its shareholders further over the coming weeks in relation to potential further funding of short-term working capital requirements ahead of this strategic investment process and long-term fund raise being concluded, based on reasonable expectation by the directors that sufficient short-term funding can be raised from shareholders,” it said.
Corre, which floated on Euronext Dublin almost three years ago, said last month that it has hired investment bank Rothschild & Co to advise it on approaches it has had “from multiple parties” to invest in the company to provide it with additional funding for investment on projects and working capital.
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Shares in the company have fallen by more than 80 per cent over the past 12 months. This has been partly down to a slump across the wider green energy sector amid a decline in energy prices and the weight of higher interest rates on this capital-intensive sector.
However, according to observers, it is also down to concerns about Corre having failed to sufficiently spell out the financial details of its various projects to allow investors assess their potential for profit.
Corre’s most advanced development is its Zuidwending (ZW1) project in the province of Groningen in the Netherlands. ZW1 will be capable of supplying up to 320MW of electricity to the grid for up to 3½ days and is due to come on stream around the end of 2026.
Other key projects include Corre’s 320MW Green Hydrogen Hub project in Denmark, another facility in the Netherlands (ZW2) and a plan to develop three compressed air energy storage plants in caverns secured last year in Germany.
Corre also, more recently, targeted the US market, signing a deal in Texas last July, giving it an option to buy a 280MW compressed air energy storage project.
“Our commercial milestones and growth plans were achieved as market demand for our projects continued to rise,” said chief executive Keith McGrane. “Our financial position in 2023 is very much in line with expectation for this development stage of our business as we continue to deliver growth and commercial ambition. At a project level we secured further co-investment whilst in parallel we have commenced a process to secure further, substantial investment for the business.”
Shares in Corre were hit in late February – falling below its €1 initial public offering price for the first time – when founding director and large shareholder Darren Patrick Green, stepped down as an executive director after a Singaporean company ultimately owned by him was named by UK tax authorities in relation to an alleged tax-avoidance scheme.
Mr Green told The Irish Times that he was “absolutely astonished” by the news and had not been a director of – or been involved in the running of – that company for years. He said he remains committed to the 38 per cent stake he owns in Corre. But it is perceived by the market as an overhang.
Corre swung into a profit of €5.64 million last year from a €30.1 million loss for 2022, with the difference largely relating to the revaluation of stock options that had been granted to its funding provider Italian private equity fund Fondo Italiano per L’Efficienza Energetica (FIEE).
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