£29m funding will help fulfil backlog of orders
Sheffield hydrogen power specialist ITM Power plans to raise £29.4m through share placing, which the company says will help to fulfil a backlog of orders.
The firm, based in Attercliffe if Sheffield, also plans to move to new larger facilities which will consolidate the group’s two current sites and is expected to facilitate annual production capacity of 300MW.
ITM Power also seeks to raise £4.4m through an open offer of new ordinary shares. It says the fundraising is provide working capital to support the delivery of the contract backlog and opportunity pipeline, to move to new larger facilities to increase annual production capacity, to strengthen the Group’s balance sheet, and to move toward achieving positive cash flow and profitability within the medium term.
Graham Cooley, chief executive of ITM Power, said: “We are delighted to disclose our £180m opportunity pipeline of highly qualified tenders, which sits behind our growing backlog of contracted orders. This demonstrates significant traction for ITM Power’s products and the growing momentum in the hydrogen energy market overall.
“The £25m placing and up to £4.4 m open offer considerably strengthens our balance sheet and should provide enhanced confidence to our customers on ITM Power’s ability to deliver future orders at increased scale. It should also enable us to unlock further efficiencies in our supply chain. We look forward to updating the market as opportunities are converted from pipeline to contracted sales, as we near our target of positive cashflow generation.”
As at 19 September, ITM Power had £20m of projects under contract and a further £16.7 million in the later stages of negotiation.
In addition the Group will look to install an enlarged grid connection of up to 5MW, in order to be able to test larger scale electrolysers.
Cash flow remains a key consideration for the Board, and the presiding financial objective for ITM Power is the achievement of a positive cash flow in the medium term. To manage working capital demands and mitigate the impact of existing projects with cash receipts towards the end of the contractual agreement, the Company is seeking a move towards quoting for potential sales with upfront payment terms, thus reducing the initial working capital outlay of such commercial projects.
