TIDMITM
RNS Number : 4872L
ITM Power PLC
13 September 2021
13 September 2021
ITM Power Plc
("ITM Power", the "Company" or the "Group")
Final Results for the Year to 30 April 2021
ITM Power (AIM: ITM), the energy storage and clean fuel group,
announces final results for the year ended 30 April 2021.
HIGHLIGHTS
Developments in the year:
-- First full year of operating the strategic partnership with
Linde Engineering, which together with our investment in ITM Linde
Electrolysis (ILE) GmbH, allows ITM Power to focus on the
manufacture of electrolysis equipment for larger scale systems
-- Sale of world's largest PEM electrolyser to Linde and sale of
first MW-scale electrolyser to Sumitomo for deployment in Japan,
and a 4MW electrolyser for the US market included within the
backlog
-- Commercial partnership agreement with Snam (one of the
world's leading energy infrastructure operators), including a
GBP30m strategic investment and an initial 100MW preferred supplier
commitment to 2024
-- Successful equity fund raise of GBP172m (including the Snam
investment) to accelerate development
-- Completion of the worlds' first electrolyser Gigafactory,
expected to reach annual production capacity of 1,000MW per annum
by end 2023 and official opening by the Business & Energy
Secretary, Kwasi Kwarteng
2021 results:
-- Total Revenue & Project Grant Funding of GBP5.1m (2020: GBP5.4m) down 6%, comprising:
o Sales revenue: GBP4.3m (2020: GBP3.3m) up 30%
o Collaborative grant income recognised: GBP0.8m (2020: GBP2.1m)
down 63%
-- Loss from operations GBP26.7m (2020: GBP29.4m), reduced by 9%
-- Adjusted EBITDA loss GBP21.4m (2020: loss GBP18.1m), increased 18%
-- Available cash balance of GBP176.1m at year-end (2020: GBP39.9m)
Current trading
09/2021 10/2020 % change
Work in Progress* GBP36m GBP16m +125%
Contracts backlog** GBP171m GBP119m +44%
Tender pipeline
*** GBP378m GBP195m +94%
*Work in Contracted backlog
Progress
**Contracts Contracted backlog and contracts in the final stages
backlog of negotiation and preferred supplier backlog
***Tender Quotations submitted in response to commercial
pipeline tenders in the last 12 months and now only reflecting
the value to ITM Power
-- Contracts backlog of GBP171m (2020: GBP119m) constituting 310MW of electrolysers up 44% YoY
-- GBP36m (2020: GBP16m) of contracted backlog (Work in
Progress) up 125% YoY representing 43MW of electrolysers
-- 10MW of the backlog (Work in Progress) is the REFHYNE I project recognised over time
-- The balance of the backlog (Work in Progress) is expected to be delivered in FY22
-- Tender pipeline value to ITM Power of GBP378m (2020: GBP195m), up 94% YoY
-- Tender pipeline constitutes 1,011MW of potential electrolysis demand
-- Installation of the 10MW REFHYNE I project completed, with
expansion by 100MW planned for REFHYNE II, at Shell's Rhineland
Refinery
-- Refuelling assets now grouped together under ITM Motive, with
focus shifting to larger scale refuelling projects for fleets,
buses and trains to increase profitability and provide a more
appropriate structure for sustainable growth of the network.
-- Part of consortium awarded EUR5m for the OYSTER Project to
Study Offshore Green Hydrogen Production
Current Year Guidance
-- Core stack module production to be in excess of 55MW
-- Completed products volume to be between 33-50MW
-- Revenue recognition depends on site access, travel
restrictions, and Micro-chip and steel availability
-- Revenue will be heavily weighted to H2 2022
Graham Cooley, CEO, commented , "2021 has been another
transformational year for ITM Power. We attracted a strategic
investor in Snam S.p.A., and through our fund raise in October 2020
developed a platform to deliver to market our next generation
product, the 5MW Gigastack, two years earlier than previously
planned. We also moved into Bessemer Park, the world's largest PEM
electrolyser factory and commenced manufacturing there in January
2021. We have seen national commitments to net zero accelerate, and
I believe we are very well placed, with our partner Linde, to
address the rapidly growing demand in the market."
For further information please visit www.itm-power.com or
contact:
ITM Power Plc +44 (0)114 551 1205
James Collins, Investor Relations
Investec Bank plc (Nominated Adviser
and Broker) +44 (0)20 7597 5970
Jeremy Ellis / Chris Sim / Ben
Griffiths
Tavistock (Financial PR and IR) +44 (0)20 7920 3150
Simon Hudson / David Cracknell
/ Tim Pearson
About ITM Power Plc
ITM Power Plc 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. In October 2019, the Company announced the completion of a
GBP58.8 million fundraising, including an investment by Linde of
GBP38 million, together with the formation of a joint venture with
Linde to focus on delivering renewable hydrogen to large-scale
industrial projects worldwide. ITM Power signed a deal to deploy a
10MW electrolyser at Shell's Rhineland refinery. In November 2020,
ITM Power completed a GBP172m fundraising, including a GBP30m
investment by Snam, one of the world's leading energy
infrastructure operators. ITM Power operates from the world's
largest electrolyser factory in Sheffield with a capacity of 1GW
(1,000MW) per annum. ITM Power received an order for the world's
largest PEM electrolyser of 24MW from Linde in January 2021. Other
customers and partners include Sumitomo, Ørsted, Phillips 66,
Scottish Power, Siemens Gamesa, Cadent, Northern Gas Networks,
Gasunie, RWE, Engie, GNVert, National Express, Toyota, Hyundai and
Anglo American among others.
Chairman's Statement
The year to April 2021 was a further year of innovation and
growth for the Group, as the build of Bessemer Park, our new 1GW
factory concluded, and the Group started to win its first contracts
through its joint venture with Linde GmbH, ITM Linde Electrolysis
GmbH. The partnership with Linde has enabled the Group to
concentrate more directly on its key manufacturing capabilities and
to develop a more comprehensive, solutions-led approach to an
increasing number of addressable markets, both in geography and
application.
During the year, the Group announced a GBP172m fund raise to
accelerate the technology offering, both in terms of performance of
existing products but also to accelerate the development of the 5MW
Gigastack, in direct response to market demand for larger systems.
The opportunity pipeline has grown significantly. New and larger
systems, using the Gigastack, remain on track for factory readiness
in late 2022 and are already being bid into a growing range of
projects.
During the past year the Group made changes to the board, with
Katherine Roe joining the board, and leading both the Remuneration
Committee and the ESG Committee. In December 2020, Tom Rae also
joined the board as nominee director of JCB.
In May two important reports were published regarding the macro
market dynamics for hydrogen. The IEA (International Energy Agency)
report "Net Zero by 2050; A roadmap for the Global Energy Sector"
stated that to get to net zero by 2050 the world needs 322m Tonnes
of electrolytic hydrogen and a global electrolyser capacity of
3,585GW. The Aurora Energy report "HyMAR" identifies a current
pipeline of electrolysers of over 200GW, with 85% of the 200GW in
Europe.
National electrolyser targets increased from 40GW to 144GW in
the year and the EU announced its new net-zero law. China also
declared net-zero by 2060. The US re-joined the Paris Agreement on
February 19th, 2021 and declared its first Department of Energy
"Earthshot" for Green Hydrogen on 7th June 2021.Global demand for
electrolysers from industry, to decarbonise production processes,
and from utilities and power companies, to store renewable energy,
is accelerating. This potential scale of demand originally
underpinned the Group's decision to invest in a step change in
capacity at the new Bessemer Park facility. In the event, the new
1GW per annum capacity is likely to be fully utilised earlier than
originally envisioned, as evidenced by tendering activity and ITM
Power's backlog of firm orders. As the drive to achieve net zero
targets continues, the market for large scale electrolysis
equipment to produce green hydrogen may well become supply
constrained.
In closing, I would like to thank all shareholders, old and new,
for their support and to recognise the significant achievements of
the staff at ITM Power Plc resulting from their hard work in 2020
and 2021.
Sir Roger Bone
Chairman
10 September 2021
REVIEW
Introduction
ITM Power designs and manufactures integrated hydrogen energy
systems based on Proton Exchange Membrane (PEM) electrolyser
technology and has a product offering that is scalable above 100MW
in size. Of particular importance is the ability of the systems to
respond rapidly and to generate hydrogen at a pressure, flow rate
and purity appropriate to its application.
ITM Power is a globally recognised expert in hydrogen
technologies with the overarching principle of taking renewable
energy from the power network or other directly coupled sources,
converting it into green, zero-carbon-footprint hydrogen and using
it in one of three broad applications, Power-to-Gas, Clean Fuels
and Industrial Hydrogen. There has been significant growth in
demand for these applications in the market place and the directors
continued to believe that all of these markets will grow further
over the coming years based on the commitment by governments
worldwide to mitigate climate change, the growth of renewables in
the energy mix and the need to decarbonise industrial
processes.
The directors believe that ITM Power remains uniquely
well-placed to capture material shares of each market.
Building a Global Presence
ITM Power has worked hard to build relationships globally by
adding anchor points - via our partnership with Linde and through
collaborations - outside of the UK market. This effort will put the
Group in a good position to service markets internationally both
now and in the future.
One such partnership with Optimal will provide long-term
commissioning, operational and maintenance support, enhancing ITM
Power's capabilities to deploy skilled engineering resource and
spare parts for its customers across Australia. To ensure that ITM
Power's customers continue to enjoy the benefits of low cost and
low carbon energy well into the future, Optimal will provide
nationwide service and support through its network of factory
certified ASP's (Authorised Service Personnel).
The provision of a 0.7MW HGas electrolyser system for use in a
hydrogen microgrid project in Tasmania supported by the Federal
Government's Blue Economy CRC programme will be the first
deployment with Optimal and a platform for training through ITM
Power's Hydrogen Academy.
The sale of a 2.0MW electrolyser to Sumitomo Corporation will be
used as an important reference plant for further sales in Japan
through our partnership with Sumitomo. This will be the first MW
scale electrolyser system ITM Power has deployed in Japan. The
HGas3SP product will undergo modification to ensure hydrogen supply
pressure is below 10 bar in order to comply with Japan's High
Pressure Gas Safety Act. ITM Power and Sumitomo are continuing
their collaboration in the areas of business development, local
compliance and after sales support to ensure a comprehensive green
hydrogen offering in Japan.
Covid-19
Covid-19 has continued to have an impact on the normal
operations of the Group. Staff who can work from home have been
doing so throughout the financial year, supported through VPN
access, Microsoft Teams, various Sharepoint spaces dealing with
wellness and mental health related topics and more recently, an
internal network space called Yammer that aims to provide a
community spirit to the workforce.
As reported previously, the factory was temporarily reduced to a
skeleton staff at the start of the 2020-21 financial year, with 29
production staff furloughed under the government job retention
scheme while changes were implemented to ensure the premises were
Covid-secure.
In early June, we began the process of returning people to the
factory. This required risk assessments of areas to make them
suitable for work under new social distancing rules, close liaison
with shop floor personnel over abilities to return to work and
skillset requirements to further the production process at the
correct times, as well as return to work inductions to explain the
new PPE and location requirements for safe, effective working.
With Bessemer Park available for office use from the autumn and
a transfer of the factory after the Christmas break, we have
additional flexibility and space to enable staff to come into work
safely, whilst ensuring numbers remained manageable within social
distancing guidelines. This has allowed us to offer alternatives
for people who have been struggling to work from home.
Management continued to monitor the effect of Covid-19 to deploy
personnel efficiently to project site works in order to minimise
project delays, utilising European and third party engineers in
locations to which UK staff could not travel.
Marketing
ITM Power has been developing a dedicated Training and Marketing
suite facility at the Bessemer Park Gigafactory, which will enable
the business to host our own marketing and training events, as well
as provide a venue for National and International conferences that
align with ITM Power's objectives. The Marketing suite can provide
seating for over 100 attendees and will become an important
marketing resource as the world opens up again post-Covid.
The business has hosted a number of visitors as the Covid
restrictions have begun to lift, including Mr Clive Betts, the
Member of Parliament for Sheffield South East and a delegation from
Chile's Energy and Mining Ministry, led by Minister Juan Carlos
Jobet.
The Group has been active in supporting the 100MW Gigastack
project and developing communications alongside BEIS, Ørsted and
Phillips 66 Limited. The project won the Humber Renewables Award
for Innovation in March 2021, and published a project update in May
this year, with the final report due in September 2021.
This year the Covid restrictions have continued, and exhibitions
including the Hannover Messe, normally a key event in ITM Power's
calendar and the source of much interest for our technology have
been cancelled or limited to online activities.
The Group continues to send out regular communications via a
newsletter and we have a growing number of sign-ups to receive the
news from ITM Power.
Bessemer Park - Global Manufacturing HQ, Sheffield
The fit out of the 1GW (1,000MW) per annum Gigafactory at
Bessemer Park reached 'Practical Completion' - the handover to the
Group by the contractors of the completed building - in January
2021, having suffered only a minor delay from the Covid-19
pandemic. The completed fit out included an expansion of the
existing offices, enlargement of the stack manufacturing and
production areas and a dedicated ATEX rated space for factory
acceptance testing of products, all coupled with the necessary 5MW
power supply on site.
The Gigafactory also houses the 24-hour remote and technical
monitoring centre that will support ITM Power's after-sales service
proposition, the Marketing centre, Technology centre and component
stores. The site, just off J34 of the M1 in Sheffield will welcome
visitors in the near future, with the creation of the conferencing
facility, as well as a Hydrogen Academy to support the training of
apprentices, local engineers and customers, together with
facilities for site visits by customers, shareholders and other
stakeholders.
The ITM Power Gigafactory delivers a blueprint for a high
capacity, semi-automated PEM electrolyser manufacturing facility,
which can be readily replicated elsewhere, enabling a local
facility to be planned and rapidly deployed in response to large
order volumes.
The factory was officially opened by the Rt Hon Kwasi Kwarteng,
Secretary of State for Business, Energy and the Environment on 17
August 2021 as he launched the UK Government's Hydrogen
Strategy.
Products and technology
ITM Power continues to place strategic focus on the development
of its technology. The opening of Bessemer Park earlier this year
saw the Product Development and Technology teams relocate into the
new Technology Centre. The additional space provides an excellent
location to build on the Group's 20 years of experience and
accelerate key development activities.
The ITM Power technology roadmap is focused on reducing cost,
increasing efficiency and expanding production capacity of our
electrolyser stacks and products. Particular emphasis has been
placed on verification of improvements at the stack level. These
have included improved membrane materials, ultra-low catalyst
loadings and in-house component preparation. The now co-located
technology and production teams work closely together as new
manufacturing machines are adopted by the business to underpin
production capacity ramp up and prepare for the larger 5MW
Gigastack platform.
Product cost reduction is an important focus area for ITM Power.
Last year the Group presented a full system price reduction plan
including a target to halve the average product price within five
years. The strategy to achieve these improvements is centred on
standardisation and modularisation of the product offering
alongside fully leveraging global buying power of partners and an
integrated technology roadmap. The single biggest gains are
available from the PEM stack and the power conversion systems. ITM
Power has brought key stack preparation processes in-house with the
move to Bessemer Park. Together with semi-automation and in-line
quality assurance, this has achieved both cost reduction and
capacity expansion for the stack platform.
Another focus area has been continued reduction of precious
metal loading. Over the last 10 years, the use of precious metals
within ITM Power stacks has reduced by over 80%. This core
competency and vertical integration enabled ITM Power to achieve
the 2030 EU target of 0.4mg/W for precious metal loading for
electrolysers in 2019 and significant further progress has been
made since then. As a manufacturer of its own catalyst inks, ITM
Power has been working on the reduction, recycling and reuse of
precious metal catalyst loading for 20 years. As part of the
Group's existing cost reduction plan, these developments will be
rolled out in phases, subject to ITM Power's well-established
verification process. This long running activity makes an important
contribution to cost reduction and provides some insulation against
the risk of supply constraints in the precious metal supply
chain.
Working with Linde GmbH
Following on from Linde GmbH's strategic investment in ITM Power
and the establishment of ITM Linde Electrolysis GmbH, in which ITM
Power holds a 50% stake, work has continued to develop and embed
the strategic partnership with Linde. This partnership allows each
company to focus on its core competencies, with ITM Power to focus
solely on its prime source of competitive advantage - the efficient
manufacture and supply of best in class PEM electrolysers, while
Linde will provide its world leading EPC services to offer
best-available hydrogen solutions to customers.
This partnership is now starting to bear fruits, with the
signing in January 2021, of the first contact under the
partnership, to build, own and operate the world's largest PEM
electrolyser plant at the Leuna Chemical Complex in Germany. This
new 24-megawatt electrolyser, supplied by ITM Power will produce
green hydrogen for industrial customers through Linde's existing
pipeline network. In addition, Linde will distribute liquefied
green hydrogen to refuelling stations and other industrial
customers in the region. The total green hydrogen to be produced
from the electrolyser system could fuel approximately 600 fuel cell
buses driving 40 million kilometres and save up to 40,000 tons of
carbon dioxide exhaust emissions per year.
The pipeline of potential projects coming through the joint
venture continues to grow and the relationship with Linde continues
to strengthen at all levels.
Working with Snam S.p.A.
As part of the strategic fund raise in October 2020, Snam
invested GBP30 million in ITM Power, and entered into a Commercial
Partnership Agreement between the businesses, which included
preferred supplier status for the first 100MW of Snam's PEM
electrolyser orders for delivery by 2024/2025.
The Commercial Partnership Agreement also includes the potential
for collaboration on a global pipeline of further projects. Since
the partnership was agreed in October 2020, initial discussions
have taken place between ITM Power and Snam to establish best
practices for working and partnering on projects. SNAM have also
taken positions on the Technology Management Committee and
Strategic Advisory Committee within the ITM Power business.
Business environment
In July 2020, the European Commission announced its EU Hydrogen
Strategy and its Energy Systems Integration Strategy. The
announcement prioritised the development of renewable hydrogen,
produced using mainly wind and solar energy and went on to
state:
-- From 2020 to 2024, we will support the installation of at
least 6GW of renewable hydrogen electrolysers in the EU, and the
production of up to one million tonnes of renewable hydrogen.
-- From 2025 to 2030, hydrogen needs to become an intrinsic part
of our integrated energy system, with at least 40GW of renewable
hydrogen electrolysers and the production of up to ten million
tonnes of renewable hydrogen in the EU.
-- From 2030 to 2050, renewable hydrogen technologies should
reach maturity and be deployed at large scale across all
hard-to-decarbonise sectors.
To help deliver on this Strategy, the Commission has launched
the European Clean Hydrogen Alliance, which aims to build up an
investment pipeline for scaled-up production and support demand for
clean hydrogen in the EU.
In August 2021, the UK government set out its own Hydrogen
Strategy to drive forward a green industrial revolution and meet
their ambition for 5 GW of low-carbon hydrogen production capacity
by 2030. The Strategy sets out a policy landscape to identify
priorities and support mechanisms for rolling out green hydrogen
production in the UK. It includes a Hydrogen Business Model
designed to overcome the cost gap between low-carbon hydrogen and
fossil fuels and a Net Zero Hydrogen Fund for the commercial
deployment of new low-carbon hydrogen production plants across the
UK.
Power-to-Gas
As governments and supra-national bodies continue to legislate
for the reduction of emissions following the COP21 Paris Agreement
on climate change, planting up with renewable generation has
increased the need for energy storage to address the challenge of
intermittency. Battery technology cannot achieve this at the scale
required. Thus, the offshore wind and gas sectors have started to
advocate green hydrogen as the means for sustaining their long-term
business models.
Power-to-Gas can meet the demand for long-term, large-scale
energy storage, converting surplus renewable energy into hydrogen
gas by rapid response electrolysis and subsequently injecting it
into the gas distribution network. These grid balancing services
can be an important source of revenue for operators and ITM Power's
rapid response Proton Exchange Membrane (PEM) technology allows
units to be turned on and off in under one second making them
eligible for the UK National Grid's Enhanced Frequency Response
Payments.
ITM Power enjoys a unique position having supplied the world's
first PEM Power-to-Gas electrolyser in 2014, and continues to
engage in a number of industry-leading strategic projects.
The OYSTER Project to Study Offshore Green Hydrogen
Production
The Fuel Cells and Hydrogen 2 Joint Undertaking (FCH2-JU), a
public private partnership of the European Commission, has made an
award of EUR5m to investigate the feasibility and potential of
combining an offshore wind turbine directly with an electrolyser
and transporting renewable hydrogen to shore.
To realise the potential of offshore hydrogen production, there
is a need for compact electrolysis systems that can withstand harsh
offshore environments and have minimal maintenance requirements
while still meeting cost and performance targets that will allow
production of low-cost hydrogen. The project will provide a major
advance towards this aim. The electrolyser system will be designed
to be integrated with a single offshore wind turbine, and to follow
the turbine's production profile. Furthermore, the electrolyser
system will integrate desalination and water treatment processes,
making it possible to use seawater as a feedstock for the
electrolysis process.
The OYSTER project partners share a vision of hydrogen being
produced from offshore wind at a cost that is competitive with
natural gas (with a realistic carbon tax), thus unlocking bulk
markets for green hydrogen making a meaningful impact on CO(2)
emissions, and facilitating the transition to a fully renewable
energy system in Europe. This project is a key first step on the
path to developing a commercial offshore hydrogen production
industry and will demonstrate innovative solutions with significant
potential in Europe and beyond.
The project is planned to start in 2021 and run to the end of
2024, over which time the consortium will develop and test a
megawatt-scale fully marinised electrolyser in a shoreside pilot
trial. ITM Power is responsible for the development of the
electrolyser system and the electrolyser trials, while Ørsted will
lead the offshore deployment analysis, the feasibility study of
future physical offshore electrolyser deployments, and support ITM
Power in the design of the electrolyser system for marinisation and
testing. Siemens Gamesa Renewable Energy and Element Energy are
providing technical and project expertise.
Clean Fuel
The transport sector is one of the largest users of fuel in the
world, and currently it is dependent on fossil fuels, which are
highly polluting and are becoming ever scarcer and more expensive.
Hydrogen fuel is generated on site by ITM Power's rapid response
electrolyser system, using renewable electricity and water with a
full tank of fuel dispensed within a matter of minutes at the
station where it is generated. This means a zero-carbon footprint
and no use of further transport infrastructure.
Hydrogen is light and can be stored under pressure, making it
suitable for many vehicle types as it does not add further weight,
or use further energy when on board. An additional benefit of
hydrogen is its role in supporting the drive for cleaner air,
especially important in densely populated cities. When hydrogen
fuel cell electric vehicles are driven, the only emission is water
vapour and each three-minute car refuel provides a range of up to
400 miles.
ITM Motive: Owner-operator of refuelling stations
ITM Power continue to roll out a network of hydrogen refuelling
stations in the UK and was proud to play a part in the support of
key workers during the Covid-19 lockdowns. In the year, the Group
dispensed 14 tonnes of hydrogen from its refuelling stations (2020:
31 tonnes).
The Group recently completed work on its ninth UK public access
hydrogen refuelling station (HRS) at Tyseley Energy Park in
Birmingham. This is due to be joined by a bus refueller in the
coming months.
Post year-end plans were announced to group ITM Power's
refuelling station portfolio into a separate but still wholly owned
subsidiary, ITM Motive. The strategy will be to focus on larger
scale refuelling for fleets of vehicles while the public stations
build their revenue. Motive continues to work closely with its
partners across the entire supply chain and is particularly excited
to see OEMs bringing new vehicles to the market including the MK2
Mirai this year, several bus options, and coming early next year
trucks from Hyzon and panel vans from a range of manufacturers
including Vauxhall in the UK. The availability of a wide range of
vehicle options should lead to a significant growth in the
market.
Larger vehicle refuelling
Within 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.
ITM Power has won contracts to supply on-site hydrogen generation
equipment for refuelling in the UK, France, the US and
Australia.
'Green Hydrogen for Scotland' to help reach net zero targets
A pioneering strategic partnership has been established to
create new green hydrogen production facilities with clusters of
refuelling stations across Scotland. These clusters will allow
Scotland's abundant renewable power generation capacity to be
converted to hydrogen for use by vehicles, supporting efforts to
achieve net zero by 2045 . 'Green Hydrogen for Scotland' will offer
an end-to-end market solution for reducing vehicle emissions
through the provision of green hydrogen.
The partnership's first project, 'Green Hydrogen for Glasgow',
is designed to provide carbon-free transport and clean air for
communities across the city, which wants to become the first
net-zero city in the UK. A planning application has now been made
for a proposed green hydrogen production facility located on the
outskirts of the city at ScottishPower Renewables' Whitelee Wind
Farm, the UK's largest onshore wind farm . This will be operated by
BOC, using wind and solar energy to power a 20MW electrolyser,
delivered by ITM Power . This represents a doubling in the
electrolyser scale capacity originally envisaged and is in response
to market demand . The project aims to supply hydrogen to the
commercial market within the next two years.
This project also supports the Scottish Government's
decarbonisation targets and Glasgow City Council's commitment to
creating a zero emissions vehicle fleet, using only electric and
hydrogen-powered vehicles by the end of 2029.
H2OzBus Project - Deploying Hydrogen Fuel Cell Bus Fleets for
Public Transport across Australia
In May 2020, ITM Power announced the formation of the H2OzBus
Project and the signing of a memorandum of understanding with
strategic partners. The project will focus on infrastructure
requirements and detailed plans for an initial deployment of 100
hydrogen fuel cell electric buses in up to 10 central hub locations
across Australia where interest and demand for fuel cell buses has
already been identified. This aligns well with ARENA's (Australian
Renewable Energy Agency) key investment priorities in Accelerating
Hydrogen and Decarbonising Industry.
The key expertise of each partner and their proposed roles in
the project are: ITM Power and BOC will provide the hydrogen
production and refuelling infrastructure; Ballard Power Systems
will supply the fuel cell system to be integrated into the electric
buses supplied by supporting bus manufacturers; Transit Systems,
will maintain and operate the vehicles as part of their daily urban
transit operations (or within a strategically located project
managed by Transit Systems), and: Palisade Investment Partners will
assist in providing funding and strategic financial oversight, for
the project.
Green Hydrogen Project in Herten, Germany with Linde
Engineering
Linde Engineering announced its successful bid for the design
and construction of an integrated hydrogen refuelling station and
electrolysis plant for AGR in Herten, confirming that ITM Power is
the preferred supplier of the electrolysis equipment envisioned by
the project.
The project is receiving funding from the German Federal
Ministry of Transport and Digital Infrastructure.
The electrolysers will have an annual capacity of around 440,000
kg of hydrogen with electricity coming from AGR's waste-to-energy
thermal power plant, where municipal and commercial waste with a
biogenic content of around 50 percent serves as the primary fuel
source. The planned refuelling station will be able to fill
vehicles at 350 bar and 700 bar and therefore will be suitable for
both cars and trucks, including AGR's own fleet of waste
trucks.
Through the thermal recycling of local waste and its conversion
into hydrogen, the undertaking is a successful example of the
circular economy in action, providing an important reference site
for the municipality market.
Industrial
Many industries use hydrogen as part of their production
processes. Today, almost all of this hydrogen is made by steam
reformation of methane (natural gas), a highly carbon intensive
method. Three industries dominate carbon emissions from the use of
hydrogen: ammonia production, steel making and the Group's prime
target, refineries. Refineries currently use hydrogen to improve
the quality of fractional distillation products and most of this
hydrogen is produced from steam-reformation but in order to comply
with stringent legislation and avoid fines, refineries need a
cost-effective green hydrogen solution that reduces carbon
emissions while allowing them to maintain output.
In addition, natural gas reformers have long start-up times.
With their rapid start up times, ITM Power's PEM electrolysers
could provide an immediate backup solution to prevent production
downtime and preserve security of hydrogen supply.
In steel making, iron ore requires chemical reduction before
being used to produce steel; this is currently achieved through the
use of carbon, in the form of coal or coke. When oxidised, this
leads to emissions of about 2.2 tonnes of CO(2) for each tonne of
liquid steel produced. The substitution of hydrogen for carbon has
the potential to significantly reduce CO(2) emissions, because
hydrogen is an excellent reducing agent and produces only water as
a by-product.
Sale to Linde of World's Largest PEM Electrolyser
In January 2021, Linde announced that it will build, own and
operate the world's largest PEM electrolyser plant at the Leuna
Chemical Complex in Germany. This new 24-megawatt electrolyser will
be supplied by ITM Power to produce green hydrogen for industrial
customers through Linde's existing pipeline network. In addition,
Linde will distribute liquefied green hydrogen to refuelling
stations and other industrial customers in the region. The total
green hydrogen to be produced could fuel approximately 600 fuel
cell buses driving 40 million kilometres and save up to 40,000 tons
of carbon dioxide exhaust emissions per year.
Planned 100MW expansion of the Shell refinery project
In February, Shell announced plans to increase the capacity of
the ITM Power PEM electrolysis plant by 100MW at its Rhineland
Refinery in Germany. Shell's partners for the REFHYNE II
electrolysis project are ITM Power, ITM Linde Electrolysis and
Linde. Subject to finalising contracts and securing some matching
funding, the partners will work with the Shell to effect this
upgrade.
Shell intends to manufacture sustainable aviation fuels in the
Wesseling section of the Rhineland Refinery. To this end, the
company wants to set up a first commercial Bio Power-to-Liquid
plant. The synthetically produced kerosene is intended to help
reduce airlines' CO2 footprint. Construction of this facility could
start in 2022, pending final investment decisions. Both the
electrolyser upgrade and the synthetic kerosene projects are
integral parts of the planned transformation of the site into the
"Shell Energy and Chemicals Park Rhineland.
Electrolyser Sale to Linde for H2Pioneer in Austria
One of the main goals of the H2Pioneer project is demonstrating
the production of green hydrogen on-site to be used in
semiconductor production, mostly replacing the supply of liquified
hydrogen delivered in trailers. An HGas3SP (2MW) electrolyser
system will produce green hydrogen, which after further
purification by Linde will be ultra-pure and suitable for
semiconductor manufacture. The use of electrolysis simplifies
downstream hydrogen purification and minimises delivery logistics
while helping to reduce carbon dioxide emissions from the hydrogen
supply chain. This is an industry that Linde understands very well
and in which it has numerous existing customers worldwide but will
be a new industry for ITM Power technology.
FINANCIAL REVIEW
Revenue Streams for the Group
As well as having potential revenue streams from three large
application markets, there are a variety of ways in which the Group
can generate revenue globally:
Product Sales
ITM Power positions itself as a provider of PEM electrolyser
systems, selling to a range of customers and target markets
globally. The Group offers standard containerised and modular
large-scale solutions based around core technology.
Consulting Contracts
Many system contracts that are bespoke are preceded by a design
study or a Front-End Engineering Design (FEED) contract that
defines solutions to customer specifications.
Maintenance Contracts
ITM Power offers warranties on systems alongside remote support
and maintenance contracts. The Group expects to generate a growing
long-term income stream from these activities as system deployments
continue.
Fuel Sales (Own and Operate model)
The Group has been the beneficiary of funding from UK and EU
bodies, which has helped accelerate infrastructure development for
the provision of hydrogen to fleets and individual users.
Grant Funding for Innovation and scale up
The Group utilises funding from grant bodies to contribute
towards research and the technical advancement of its electrolyser
products through generating greater efficiencies and cost
reductions for ITM Power systems.
Financial performance
Sales revenues in the year were largely generated from product
sales and consultancy. This was predominantly from two major
projects, the REFHYNE I electrolyser build and the design and proof
of concept project commissioned by BEIS.
Whilst the investment partnership with Linde has started to
generate new contracts, the revenues and cost of sales from these
have not yet materialised, owing to the accounting treatment under
accounting standard IFRS 15 Revenue from Contracts with Customers,
which will keep our standard product sales in WIP until handover to
the customer. Thus, the gross margin is still heavily influenced by
legacy projects and the challenging EPC scope of the works
contracted, particularly when hampered further by Covid-19
restrictions.
Fuel sales also suffered through Covid-19 lockdowns, generating
only GBP0.2m (2020: GBP0.4m), despite continuing to provide
hydrogen road fuel to emergency service workers.
New collaborative project funding recognised in the year was
GBP0.8m. This has funded research and data collection projects.
The pre-tax loss for the year under review decreased to GBP27.6m
(2020: GBP29.5m). The prior year contained the significant
impairment of our refuelling assets but despite the continuing
growth of the workforce, costs have also been kept in check this
year through a combination of reduced expenditure during Covid-19
lockdowns and through closure of our previous properties, leading
to a consolidation of related service expenditure that will
continue into the new financial year.
Net cash burn increased to GBP32.7m before fund raise (2020:
GBP23.3m). Cash burn is a non-statutory measure the directors use
to monitor the Group, and is calculated by deducting from annual
cash flow (GBP136.2m) the effects of any equity fund raise
(GBP168.9m). A key factor in this movement is that we have
continued to invest in our future, as illustrated by the increase
in the investment activities section of the cashflow statement from
GBP11.1m in 2020 to GBP12.4m in the current financial year. Within
this cash burn figure, there was the completion of our new building
and the fit-out of the factory, from which we have been operating
since January.
Financial position
In the year, the Group capitalised development costs of GBP1.5m
(2020: GBP1.6m). This was for design of standard products that will
facilitate our offering to the markets and developments to adapt
our core technologies for new potential uses. The directors see
continued product development as key to building commercial
traction.
There was an increase in fixed assets (excluding right of use
assets) to GBP13.5m from GBP6.5m in the prior year. The uplift
relates to the leasehold improvements at our new premises and the
kitting out of all the new areas, including labs, factory, test
bays and offices.
At year end, ITM Power Plc had current assets totalling
GBP205.5m (2020: GBP67.5m). Funds in the bank totalled GBP177.1m
(2020: GBP41.0m), of which there were amounts on guarantee of
GBP1.0m (2020: GBP1.1m). The Group has previously been required to
place amounts on guarantee as cash cover, which limits working
capital available to the Group mid-contract. ITM Power Plc
continues to structure quotes to obtain sufficient monies up front
to limit the adverse impact of increased activity on working
capital.
Total receivables excluding restricted cash amounts have reduced
from GBP22.1m (2020) to GBP21.9m. However, this balance is no
longer dominated by pro forma and early stage payments made to
suppliers for stock items required in the next wave of units
through production. Instead the balance is split fairly evenly
between trade debtors, prepayments and accrued project income. The
effort to reduce the number of prepaid suppliers will continue into
the new financial year but has been aided by an improved credit
rating and a review of our approved supplier base. Prepayments
totalled GBP6.5m (2020: GBP13.3m), down 51%.
Trade debtors in the prior year predominantly related to grant
income debtors, whereas in the current year it is purely made up of
commercial customers (2021: GBP5.5m and 2020: GBP4.3m). At year
end, the Group had trade creditors of GBP1.2m against a prior year
balance of GBP2.5m.
Overall, creditors have decreased from GBP14.0m (2020) to
GBP12.9m. The figure continues to be dominated by deferred income
(GBP9.0m in the current year and GBP9.2m in 2020), which for the
most part this year reflects money received up front on contracts.
This is partly due to the timing of contracts as we embarked on the
next wave of commercial contracts but also point in time revenue
recognition now that we have moved on to standard product
sales.
Key financials
A summary of the financial KPIs is set out in the table
below:
2021 2020 2019
GBPm GBPm GBPm
------- ------- ------
Total Projects income, being sales
and grants receivable
(as split below) 5.04 5.35 17.56
------- ------- ------
Of which: Sales Revenue 4.28 3.29 4.59
------- ------- ------
Of which: Grant recognised in the income
statement 2.12 2.47 7.23
------- ------- ------
Of which: Grant recognised on the balance
sheet * (1.35) (0.42) 5.74
------- ------- ------
Pre-tax loss 27.65 29.52 9.32
------- ------- ------
Adjusted EBITDA (21.4) (18.1) (7.3)
------- ------- ------
Property, plant and equipment plus
intangible assets 16.78 8.66 6.41
------- ------- ------
Net Assets 197.44 55.75 26.21
------- ------- ------
*Grant income recognised on the balance sheet includes grant
income recognised against the cost of assets acquired and the
movement on grant income receivable for assets paid on pro-forma
terms but not yet delivered.
Non-financial key performance indicators
FY 2021 FY 2020 FY 2019 FY 2018 FY 2017
Fuel Dispensed
(kg) 14,452 30,707 31,984 13,036 1,043
-------- -------- -------- -------- --------
Fuel Contracts
signed 40 36 33 20 14
-------- -------- -------- -------- --------
No expectations have been set with regards to KPI but prior
years provide a baseline. Fuel dispensed has been affected by the
Covid-19 lockdowns in the year with people working from home and
not travelling to events or meetings.
The number of new fuel contracts will become a less important
measure of the growth of the market for ITM Power. This is due to
an increase in the number of vehicles on the road but under the
umbrella of existing customer contracts and the uptake of private
users rather than businesses. New contracts in the current year
were mainly foreign one-off users.
Events after the Balance Sheet Date
Post balance sheet, a new subsidiary was created to house the
refuelling assets that were previously within ITM Power (Trading)
Limited. ITM Motive Limited will own and operate the UK refuelling
stations in order to drive their profitability. It is a 100% owned
subsidiary so there will be no material impact on the consolidated
accounts.
OUTLOOK
Against a rapidly growing market backdrop ITM Power has made
strong progress in the period, laying the foundations to deliver
turnkey solutions that include the Group's manufactured products to
markets as a result of partnering with world-class EPC provider
Linde. The near-term outlook is positive as the record backlog
reflects the demand for larger systems, as well as the strength of
partnerships with major blue-chip companies.
Post year end, the creation of ITM Motive Ltd -still a
100%-owned subsidiary- allows the Group to focus on both its core
manufacturing model and the own/operate model for refuelling
assets. ITM Support is also developing into a revenue-generating
business unit that will add a further offer to customers.
The Board looks forward to reporting progress as contracts are
awarded, and to providing an update at the AGM in September.
CONSOLIDATED INCOME STATEMENT AND OTHER COMPREHENSIVE INCOME
Note 2021 2020
restated
GBP'000 GBP'000 GBP'000 GBP'000
Revenue 3 4,275 3,291
Direct costs (12,145) (10,839)
Grant income against direct
costs 3 1,356 1,719
--------- -------- ---------
(10,789) (9,120)
Gross loss (6,514) (5,829)
Operating costs
Research and development (3,489) (2,298)
Production and engineering (8,839) (13,919)
Sales and marketing (1,436) (1,386)
Administration expenses (7,404) (7,028)
Expected credit loss (165) 15
Other income - government
grants 3 1,190 1,049
Loss from operations (26,657) (29,396)
Share of loss of associate
company (595) (3)
Investment income 83 90
Finance costs (479) (214)
Loss before tax (27,648) (29,523)
Tax (49) (38)
Loss for the year (27,697) (29,561)
-------- ---------
OTHER TOTAL COMPREHENSIVE INCOME:
Items that may be reclassified subsequently to profit or loss
Foreign currency translation
differences on foreign operations (78) 50
-------- ---------
Net other total comprehensive
income (78) 50
-------- ---------
Total comprehensive loss for
the year (27,775) (29,511)
======== =========
Basic and diluted loss per
share 5 (5.5p) (7.4p)
======== =========
Research and development, Production and engineering, Sales and
marketing were included as "Distribution costs" in the previous
year. These have been presented as individual functions in the
current year and therefore restated in the comparative.
All results presented above are derived from continuing
operations and are attributable to owners of the Company.
CONSOLIDATED BALANCE SHEET
Note 2021 2020
GBP'000 GBP'000
NON-CURRENT ASSETS
Investment in associate 259 346
Intangible assets 3,269 2,154
Right of use assets 6,399 6,520
Property, plant and equipment 13,514 6,501
Financial Asset at amortised cost 148 137
--------- ---------
TOTAL NON-CURRENT ASSETS 23,589 15,658
--------- ---------
CURRENT ASSETS
Inventories 6,418 4,432
Trade and other receivables 22,981 23,166
Cash and cash equivalents 176,078 39,919
--------- ---------
TOTAL CURRENT ASSETS 205,477 67,517
--------- ---------
CURRENT LIABILITIES
Trade and other payables (12,857) (14,013)
Provisions (12,276) (6,890)
Lease liability (204) (211)
--------- ---------
TOTAL CURRENT LIABILITIES (25,337) (21,114)
--------- ---------
NET CURRENT ASSETS 180,140 46,403
--------- ---------
NON-CURRENT LIABILITIES
Lease liability (6,282) (6,315)
NET ASSETS 197,447 55,746
========= =========
EQUITY
Called up share capital 6 27,533 23,664
Share premium account 6 302,248 137,236
Merger reserve 6 (1,973) (1,973)
Foreign exchange reserve 6 83 161
Retained loss 6 (130,444) (103,342)
--------- ---------
TOTAL EQUITY 197,447 55,746
========= =========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
Note Called Share Merger Foreign Retained Total
up share premium reserve exchange loss equity
capital account GBP'000 reserve GBP'000 GBP'000
GBP'000 GBP'000 GBP'000
At 1 May 2019 6 16,200 86,631 (1,973) 111 (74,760) 26,209
Transactions with Owners
Issue of shares 6 7,464 50,605 - - - 58,069
Credit to equity for
share based payment - - - - 979 979
--------- -------- --------- --------- --------- ---------
Total Transactions
with Owners 7,464 50,605 - - 979 59,048
Loss for the year - - - - (29,561) (29,561)
Other comprehensive
income 6 - - - 50 - 50
--------- -------- --------- --------- --------- ---------
Total comprehensive
income - - - 50 (29,561) (29,511)
At 1 May 2020 6 23,664 137,236 (1,973) 161 (103,342) 55,746
========= ======== ========= ========= ========= =========
Transactions with Owners
Issue of shares 6 3,869 165,012 - - - 168,881
Credit to equity for
share based payment - - - - 595 595
--------- -------- --------- --------- --------- ---------
Total Transactions
with Owners 3,869 165,012 - - 595 169,476
Loss for the year - - - - (27,697) (27,697)
Other comprehensive
income 6 - - - (78) - (78)
--------- -------- --------- --------- --------- ---------
Total comprehensive
income - - - (78) (27,697) (27,775)
At 30 April 2021 6 27,533 302,248 (1,973) 83 (130,444) 197,447
========= ======== ========= ========= ========= =========
CONSOLIDATED CASH FLOW STATEMENT
Note 2021 2020
GBP'000 GBP'000
Net cash used in operating activities 7 (20,141) (12,040)
-------- --------
Investing activities
Investment in associate (535) (349)
Purchases of property, plant and equipment (14,422) (8,986)
Finance asset (security deposit) - (137)
Capital Grants received against purchases
of non-current assets 3,992 89
Proceeds on disposal of Property, Plant
& Equipment 3 1
Payments for intangible assets (1,524) (1,771)
Interest received 83 90
--------
Net cash used in investing activities (12,403) (11,063)
-------- --------
Financing activities
Issue of ordinary share capital 173,835 59,299
Costs associated with fund raise (4,954) (1,230)
Payment of lease liabilities (156) (236)
--------
Net cash from financing activities 168,725 57,833
-------- --------
Increase in cash and cash equivalents 136,181 34,730
Cash and cash equivalents at the beginning
of year 39,919 5,173
Effect of foreign exchange rate changes (22) 16
-------- --------
Cash and cash equivalents at the end
of year 176,078 39,919
======== ========
NOTES
1. GENERAL INFORMATION
ITM Power Plc is a public company incorporated in England and
Wales under the Companies Act 2006. The registered office is at 2
Bessemer Park, Shepcote Lane, Sheffield, South Yorkshire S9
1DZ.
The summary accounts set out above do not constitute statutory
accounts as defined by Section 434 of the UK Companies Act 2006.
The summarised consolidated balance sheet at 30 April 2021, the
summarised consolidated income statement and other comprehensive
income, the summarised consolidated statement of changes in equity
and the summarised consolidated cash flow statement for the year
then ended have been extracted from the Group's 2021 statutory
financial statements upon which the auditor's opinion is
unqualified and did not contain a statement under either sections
498(2) or 498(3) of the Companies Act 2006. The audit report for
the year ended 30 April 2020 did not contain statements under
sections 498(2) or 498(3) of the Companies Act 2006. The statutory
financial statements for the year ended 30 April 2020 have been
delivered to the Registrar of Companies. The 30 April 2021 accounts
were approved by the directors on 10 September 2021, but have not
yet been delivered to the Registrar of Companies.
2. SIGNIFICANT ACCOUNTING POLICIES
Basis of accounting
The summary accounts are based on the consolidated financial
statements that have been prepared in accordance with international
accounting standards, in conformity with the requirements of the
Companies Act 2006.
They have been prepared under the assumption that the Group
operates on a going concern basis and on the historical cost basis.
Historical cost is generally based on the fair value of the
consideration given in exchange for goods and services.
Going Concern
The directors have prepared a cash flow forecast for the period
ending 30 September 2022. This forecast indicates that the Group
and parent company would expect to remain cash positive without the
requirement for further fund raising based on delivering the
existing pipeline, for a period of at least 12 months from the date
of approval of these financial statements.
By the end of the period analysed, the Group will still hold a
large proportion of the monies from the fund raise in the year.
This should give the business sufficient funds to trade for the
next three years if the business continued to operate in a similar
way beyond the forecast period.
With the uncertainty created for the economy by Covid-19, this
cash flow forecast has also been stress tested. As a worst-case
scenario, if all payments had to continue as forecast while
receipts were not received at all, the business would remain cash
positive for the full twelve months from the date of approval of
these financial statements.
The accounts have therefore been prepared on a going concern
basis.
3. Revenue, OPERATING SEGMENTS & INCOME FROM GOVERNMENT GRANTS
All revenues are derived from continuing operations. An analysis
of the Group's revenue is as follows:
2021 2020
GBP'000 GBP'000
Revenue from product sales recognised
over time 1,697 2,256
Consulting contracts recognised over
time 2,108 470
Maintenance contracts recognised at
a point in time 112 48
Fuel Sales 153 367
Other (e.g. scrap sales) 205 150
-------- --------
Revenue in the Consolidated Income Statement 4,275 3,291
Grant income shown against cost of sales 1,356 1,719
Grant income (claims made for projects) 761 753
Other government grants (R&D claims) 404 252
Other government grants (Covid-19 furlough
scheme) 25 44
--- -------- --------
1,190 1,049
6,821 6,059
======== ========
At 30 April 2021, the aggregate amount of the transaction price
allocated to remaining performance obligations of continuing build
contracts was GBP16.7m (2020: GBP3.8m). The Group expects to
recognise the remaining performance obligations within one
year.
Segment Information
ITM Power Plc is organised internally to report to the Group's
Chief Operating Decision Maker, the Chief Executive Officer, on the
financial and operational performance of the Group as a whole. The
Group's Chief Operating Decision Maker is ultimately responsible
for entity-wide resource allocation decisions, evaluating
performance on a group-wide basis and any elements within it on a
combination of information from the executives in charge of the
Group and Group financial information.
Management has previously identified three target markets for
our products (Power-to-Gas, Refuelling, and Industrial). Revenue
reporting has begun to look at these three sectors to assess the
commerciality of those sales. However, decisions for resourcing
etc. cannot be made by reference to these segments. The Group
operates a single factory that builds units for use across all
sectors. It would be hard to assign overhead costs to particular
product segments as builds all occur in that one facility and can
run concurrently. Similarly, fixed assets and suppliers' balances
cannot be assigned to the production of one specific segment. For
overhead costs and net asset resources, therefore, decisions are
taken on a group basis.
An analysis of the Group's revenue, by major product (or
customer group), is as follows:
2021 2020
GBP'000 GBP'000
Power-to-Gas
(of which product sales recognised over time GBP42,000) 210 332
Refuelling
(of which product sales recognised over time -GBP215,000) (38) 1,247
Industrial
(of which product sales recognised over time GBP1,870,000) 1,870 1,147
Other 2,233 565
-------- --------
Revenue in the Consolidated Income Statement 4,275 3,291
======== ========
The negative sales revenue on refuelling was caused by the
effects of foreign exchange as well as actual and forecast overruns
(affecting stage of completion) on the product sale therein.
Geographical Analysis
The United Kingdom is the Group's country of domicile but the
Group also has subsidiary trading companies in the United States,
Germany and Australia. All non-current assets were domiciled in the
United Kingdom, with the exception of one hydrogen refuelling
station in California (net book value GBPNil, 2020: GBPNil) and
assets relating to our German office (net book value GBP60,000,
2020: GBP31,000). Revenues have been generated as follows:
2021 2020
GBP'000 GBP'000
United Kingdom 2,505 828
Germany
(of which product sales recognised over time GBP1,893,000) 1,966 1,167
Rest of Europe
(of which product sales recognised over time -GBP196,000) (196) 1,118
United States - 178
4,275 3,291
================ ================
Included in revenue are the following amounts, which each
accounted for more than 10% of total revenue:
2021
GBP'000 2020
GBP'000
Customer A Industrial 1,870 1,140
Customer B Other 2,027 410
Customer C Refuelling <10% 854
4. CALCULATION OF ADJUSTED EBITDA
In reporting EBITDA, management use the metric of adjusted
EBITDA, to better reflect underlying performance and remove the
effect of the following items;
2021 2020
GBP'000 GBP'000
Loss before interest and tax (26,657) (29,396)
Add back:
Depreciation 2,321 2,440
Impairment 1,713 5,588
Amortisation 274 197
Loss on disposal 173 473
Share based payment charge 799 2,625
---------- ----------
(21,377) (18,073)
========== ==========
5. LOSS PER SHARE
The calculation of the basic and diluted earnings per share is
based on the following data:
2021 2020
GBP'000 GBP'000
Loss for the purposes of basic and diluted
loss per share being net loss attributable
to owners of the Company (27,697) (29,561)
Number of shares
Weighted average number of ordinary shares
for the purposes of basic and diluted earnings
per share 507,262,743 398,184,707
Loss per share 5.5p 7.4p
=============== ===============
The loss per ordinary share and diluted loss per share are equal
because share options are only included in the calculation of
diluted earnings per share if their issue would decrease the net
profit per share. The number of potentially dilutive shares not
included in the calculation above due to being anti-dilutive in the
years presented were 50,893,546 (2020: 85,329,719).
6. CALLED UP SHARE CAPITAL AND RESERVES
2021 2020
GBP'000 GBP'000
Called up, allotted and fully paid:
550,658,155 (2020: 473,277,926) ordinary shares
of 5p each 27,533 23,664
======== ========
Authorised Share capital:
======== ========
550,658,155 (2020: 473,277,926) ordinary shares
of 5p each 27,533 23,664
======== ========
Holders of ordinary shares have voting rights at Annual General
Meetings and Extraordinary General Meetings in proportion with
their shareholding.
The share premium account can move when shares are sold and
represents the amount paid in excess of the nominal value when
shares are issued.
The merger reserve arose on the acquisition of ITM Power
(Research) Limited in 2004.
The foreign exchange reserve arises upon consolidation of the
foreign subsidiaries in the Group, and accounts for the difference
created by translation of the income statement at average rate
compared with the year-end rate used on the balance sheet as well
as the effect of the change in exchange rates on opening and
closing balances.
The Group's other reserve is retained earnings which represents
cumulative profits or losses, net of any dividends paid and other
adjustments.
7. notes to the cash flow statement
2021 2020
GBP'000 GBP'000
Loss from operations (26,657) (29,396)
Adjustments:
Depreciation 2,321 2,440
Share based payment 595 978
Loss on disposal 173 473
Impairment 1,712 5,588
Amortisation 274 197
Operating cash flows before movements in
working capital (21,582) (19,720)
(Increase) in inventories (1,987) (2,525)
Decrease in receivables 185 7,964
Decrease in payables (1,156) (2,882)
Increase in provisions 4,857 5,285
Cash used in operations (19,683) (11,878)
Interest paid (479) (214)
Income taxes received 21 52
-------- --------
Net cash used in operating activities (20,141) (12,040)
======== ========
The movement on provisions has been adjusted by GBP530,000 as
the Bessemer Park dilapidations provision has been posted against
Right of Use Assets and therefore no adjustment to the income
statement for this non-cash item is required.
-ends-
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FR DBGDCUSBDGBD
(END) Dow Jones Newswires
September 13, 2021 02:00 ET (06:00 GMT)
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