ITM Power PLC Trading & Corporate Update (2379O)

TIDMITM

RNS Number : 2379O

ITM Power PLC

09 June 2022

9 June 2022

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION

ITM Power plc

("ITM", "ITM Power", the "Group" or the "Company")

Trading and Corporate Update

Development of ITM Power Service Hub in Germany

ITM Power (AIM: ITM), the energy storage and clean fuel company, provides an update on the Group's progress since the publication of the Half Year Report on 27 January 2022. The update covers work in progress and the contracts backlog as well as unaudited financial results expected for the year ended 30 April 2022 (FY22). The Company will announce final results for the year on 8 August 2022.

Backlog:

   --   Record backlog of 755 MW as at 1 June 2022, up by 53% since January and up by 160% yoy 

o Contracted: 75 MW

o In negotiation: 342 MW

o Preferred supplier: 338 MW

 
                           Apr 22 MW         Apr 21 MW        % Change 
 Work in progress*            75                43               74% 
 Contracts backlog**          755               290             160% 
 
 *Work in progress      Contracted backlog 
 **Contracts backlog    Contracted backlog and contracts in the final 
                         stages of negotiation and preferred supplier 
                         backlog 
 

Commercial and product developments:

-- 240 MW preferred supplier status of projects with Motive, our 50:50 JV with Vitol, to support the rollout of refuelling infrastructure

-- The sale of a 24 MW electrolyser to Linde Engineering, which is to be installed at a site operated by Yara Norge AS ("Yara") located at Herøya outside Porsgrunn. The electrolyser equipment, which will be used to produce green ammonia, will have revenue recognised in FY23

-- Award of GBP9.3m for Gigatest from Department for Business, Energy and Industrial Strategy (BEIS), under its Net Zero Innovation Portfolio Low Carbon Hydrogen Supply 2 Competition, to accelerate the commercial development of ITM Power's 5 MW Gigastack platform and its manufacture

   --    4MW system sold to RWE at Lingen 

-- Continuous product improvement - MEP 2.0 pressure increased by 50% to 30 bar, GEP 1.0 on track for production at end of 2023

New 50/50 JV with Vitol:

-- Strategic partnership agreement with Vitol Holdings SARL for wholly owned subsidiary ITM Motive Limited, trading as Motive Fuels, to become a 50/50 joint-venture owned between ITM Power and Vitol, including a framework agreement with ITM Power, under which Motive appoints ITM Power as its preferred supplier for up to 240 MW of electrolysis equipment

Development of ITM Power Service:

-- Development of ITM Power Service, an aftermarket focussed customer support business designed to provide full product-life-cycle support of deployed electrolyser systems

-- Existing aftermarket operations including the Group's 24/7 UK Remote Support Centre merged into one focussed organisation with new headquarters in Germany

-- The organisation will be led by Philip Wilson as Technical Director and Calum McConnell as Commercial Director, both long-term ITM Power staff members

-- Lease signed on a 17,054 sqft three storey combined office, control centre and warehouse facility in Linden, ideally located in Hessen, which is a recognised transit state within Germany with excellent motorway links and local infrastructure

-- The facility will house all spare parts, including core PEM stack technology, to ensure high service levels and rapid deployment capability to systems in Europe

   --    Supported by EUR2.0m grant from the German government 

Expected unaudited financial results for the twelve months to 30 April 2022:

   --   Revenue of GBP5.5m (2021: GBP4.3m), impacted by: 

o Deferral of 24 MW Leuna delivery of completed products and therefore revenue recognition of approximately GBP11m into FY23

   --   Adjusted EBITDA loss of c.GBP36.5m (GBP21.4m), impacted by: 

o c.GBP7m Increased skills acquisition

o c.GBP14m project delivery & production ramp up

   --   Cash Burn of c.GBP52m (GBP37.7m), impacted by: 

o c.GBP7m Product Development of MEP 2.0 and GEP 1.0

o c.GBP20m Ongoing WIP and inventory build

o c.GBP5m Production equipment for Bessemer Park

   --   Net cash at year-end of GBP364m (GBP176m) 

Dr Graham Cooley, CEO of ITM Power, said: " Over the past year, ITM Power has laid the foundations, financially and operationally, to scale our production capacity which will play a critical role in decarbonising economies using green hydrogen and enabling countries around the world to enhance their energy and food security.

"Russia's invasion of Ukraine has accelerated the intent of many countries to increase energy and food security, with a specific focus on green hydrogen, as shown by the recent UK Government and REPowerEU announcements. We believe we can gain a material share of these global markets as a result of our experience, expertise, partnerships and capacity ."

For further information please visit www.itm-power.com or contact:

 
 ITM Power plc 
 James Collins, Investor Relations          [phone] 
  Justin Scarborough, Investor Relations     [phone] 
 
 Investec Bank plc (Nominated Adviser 
  and Broker)                               [phone] 
 Jeremy Ellis / Chris Sim / Ben 
  Griffiths 
 
 Tavistock (Financial PR and IR)            [phone] 
 Simon Hudson / David Cracknell 
  / Tim Pearson 
 

About ITM Power plc:

ITM Power manufactures integrated hydrogen energy solutions for grid balancing, energy storage and the production of renewable hydrogen for transport, renewable heat and chemicals. ITM Power PLC was admitted to the AIM market of the London Stock Exchange in 2004.

ITM Power operates from the world's largest electrolyser factory in Sheffield with a capacity of 1 GW (1,000 MW) per annum and has a plan to grow capacity in line with demand to 5 GW per annum, supported by a GBP250m equity raise in Q4 2021. Partners include Linde, Shell, Snam, and Vitol among others.

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June 09, 2022 02:02 ET (06:02 GMT)