Listed energy firm anticipates 60% income drop
Energy storage and clean fuel company ITM Power expects its total income for the financial year to 30 April 2020 to be about £7m (unaudited) (2019: £17.6m), a decrease of 60% year-on-year.
The Sheffield-based business says its activity remained at similar levels to 2019, but notes the figures released today reflect project delays due to COVID-19 and losses resulting from EPC work on legacy projects.
And it adds the unaudited results do not yet reflect any of the benefits of its previously announced Joint Venture with Linde Engineering, which is focusing on delivering green hydrogen to large scale industrial projects.
Today’s update says ITM Power’s sales revenue was £3m (£4.6m), down 30% with the virus cutting revenues by approximately £1.2m.
Grant revenue was £4m (£14.3m), down 70%. The company’s update explains: “This reflects the challenges experienced in obtaining new grant funding from the EU post-2016 and increasingly the ongoing strategy of focusing on commercial sales rather than grants.
“The company does expect grant income to continue to play a role in the business in the future and this will predominantly come from appropriate funding calls from the UK Government.”
The business says its adjusted EBITDA (unaudited) loss from operations of approximately £17.5m (£6.7m) is in line with expectations.
ITM Power has also reported a record backlog of £52.4m, comprising £21.8m under contract and £30.6m in negotiation.
Commenting on future opportunities, it says the market for electrolysis is growing strongly due to the changing perspectives of industrial leaders and policymakers.
Its update adds: “In the last year, the offshore wind and gas sectors have started to advocate green hydrogen as the means for sustaining their long-term business models.
“At the same time, in the transport sector, a renewed focus has been placed on the development of zero-emission heavy vehicles, where fleets need to be refuelled with large amounts of hydrogen on a regular basis.”
Dr Graham Cooley, ITM Power CEO, said: “The emerging trends in different industrial sectors, together with increasing acceptance by governments around the world that green hydrogen is an essential vector to achieve their carbon reduction commitments, bode very well for the electrolysis market.
“Against this background, ITM Power with partner Linde is very well placed to capitalise on the major opportunities we expect to arise from the continuing drive towards climate change mitigation.”
