ITM Power posts strong project income, sees fast-growing market

ITM Power boasted strong project income in its maiden full-year results as a listed company while flagging further progress since period-end.

For the year to 30 April, total revenue and grant funding was up 13% to £9.2m from £8.2m in 2016 (Investec: £8.32m).

That had been followed by another £4.1m of products under contract after period-end, versus just £1.4m as of July 2016. On top of that, a further £12.3m of grant contracts had entered the final stage of negotiations.

According to the hydrogen fuel technology group, it was currently in possession of £17.8m under contract with a further £17.6m in the final stages of negotation, which constituted a total pipeline of £35.5m, having recognised £6.3m of income in the second half of 2017.

During the same period, the company also achieved development milestones that led analysts to raise their estimates for the company.

More specifically, it won a £3.5m contract to deploy a 3MW electrolyser system. That saw Investec's Marc Elliot raise his fiscal year 2018 estimate for the firm's income from projects in fiscal yaer 2018 by 55%. He had anticipated just a 1MW contract.

In parallel, the net book value of ITM's property, plant and equipment increased 53% from £3m in 2016 to £4.6m.

The company's cash balance decreased from £3.3m to £3m, which Elliot attributed to investing cashflow and working capital movements.

Other development successes included the launch of its first London Hyfive refuelling station at the National Physical Laboratory in London, as well as the opening of its first hydrogen refuelling station with Shell in the UK, along with planning permission for three more Shell stations.

Graham Cooley, CEO of the company, was optimistic about the company's "great" position for the future: "our market is growing rapidly and with larger systems, compliant to operate all over the world, ITM Power is in a great position to be a market leader."

For his part, Roger Putnam, the chairman added:"ITM Power continues to develop a burgeoning pipeline of exciting projects that demonstrate that there is a large and growing market for electrolyser technology. Our focus remains ensuring that ITM Power is optimally positioned to deliver its growing pipeline of established high efficiency products into those markets.

The company's shares were down 10.79% to 31.00 by 09:05 BST, albeit after a sharp run higher in the stock price since the start of the week.