ITM Power upbeat despite dip in full-year revenues

ITM Power said on Thursday that its tender pipeline was “materially” ahead of expectations, fuelled by strong demand for renewable energy, as it confirmed Covid-19 delays had dented full-year revenues.

Updating on trading, the Aim-listed hydrogen electrolyser manufacturer said work-in-progress rose 62% during the year to 30 April, to £35.4m.

The contracts backlog – which consists of the contracted backlog along with contracts in the final stages of negotiation and preferred supplier backlog – surged 194% to £154.0m. The tender pipeline rose 131% to £607m. The tender pipeline consists of quotations submitted to commercial tenders in the last 12 months.

Total revenue for the year is expected to come in at £4.0m, however, compared to £5.4m a year previously, impacted by both Covid-19 and changes to the way revenues from contracts are recognised.

Full-year losses, on both an EBITDA and EBIT basis, are expected to be “broadly in line” with management expectations.

Graham Cooley, chief executive, said: “Traction in the electrolyser industry has been even more rapid that we were anticipating. At the same time, we moved into a gigawatt factory in January, which positions us strongly to meet rapidly growing global demand reflected in a contracts backlog and tender opportunity pipeline materially ahead of our original expectations.”

The balance of the work in progress is expected to be delivered in the 2022 full-year. ITM said it expects to produce 50Mw of electrolysers by 30 April 2022, with recognised revenue weighted to the second half because of manufacturing lead times.

As at 1100 BST, shares in ITM were down 4% at 380.4p.