This to me is a good news story, but for all the wrong...

This to me is a good news story, but for all the wrong reasons.

The previous guidance for Kidston Wind was financial close (FC) by early 2023, with construction beginning in mid 2023. You can see the pipeline below from the August 2021 presentation. They may have provided a more recent update on the timing, but I haven't noticed - apologies if I missed something.

So why is this delay good news? Well, it's because of cash flows (again!) and their cost of capital (again!). The joint venture with J-Power to my mind is a good thing. It reduces Genex's exposure by 50% financially, while also enabling J-Power hopefully to provide strategic and operational advice via their representation on the board. Ideally they would have structured it with J-Power contributing more financially and having a lower ownership stake, as in debt financing not just equity financing, but alas that's not to be.

From a cash flow perspective, the negative cash flows are mainly during construction (and less so the early stages, so really kicing in mid 2024 at this point. By then *hopefully* we start seeing some cash flows coming in from Kidston Pumped Hydro. If we not, we will face another situation like Bauldercombe Battery whereby the investment may look good on paper, but the cost of capital is way too high. Delaying construction until the cash flows are coming in will mean they will be able to access debt financing or use their own cash flows, rather than have to go back to the equity markets and dilute.

TL;dr: The delays are probably good. If they don't have cash flows coming in from pumped hydro by the time construction starts, they will need to further dilute shareholders to build up their equity as they can't access debt financing.