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(Alliance News) - ITM Power PLC on Tuesday reported a fall in interim revenue and a widened loss due to"increased losses on inventory and customer contracts".
The hydrogen-generating electrolyser system manufacturer reported revenue of GBP2.0 million in the six months to October 31, down 52% from GBP4.2 million a year earlier. The majority of Leuna project revenue was deferred "due to delays and changed delivery model," it explained.
ITM's pretax loss widened to GBP56.5 million from GBP15.3 million, as cost of sales surged to GBP47.6 million from GBP6.8 million in the first half of 2021.
Its adjusted loss before interest, tax, depreciation and amortisation amounted to GBP54.1 million, widened from GBP12.9 million a year prior.
Chair Roger Bone said: "We raised capital to pursue an expansion strategy and in doing so underestimated the competencies and capabilities required to scale up and to transition from [a research & development] company to a volume manufacturer. As a consequence, we set unrealistic targets for project completion. This has produced an unacceptable financial performance."
ITM particularly highlighted certain factors that hurt its half-year results. Firstly, it said its cost discipline had not been rigorous enough as constant design changes led to "unwelcomed inventory write-downs. Secondly, it said excessive consumption of working hours was caused by project deliveries, and finally, the company noted organisational overcapacity due to an "overly-optimistic recruitment programme".
Looking ahead, ITM said it expects full-year product revenue to be around GBP2.0 million and its adjusted Ebitda loss to be in the range of GBP85 million to GBP95 million.
In September, ITM Power had guided for an adjusted loss in Ebitda between GBP45 million to GBP50 million.
At that time, it reported its pretax loss widened substantially to GBP46.7 million in the financial year that ended April 30 from GBP27.6 million. Revenue rose 32% to GBP5.6 million from GBP4.3 million. Adjusted loss in Ebitda was GBP39.8 million.
Shares were up 4.4% at 93.28 pence each on Tuesday morning in London.
By Xindi Wei, Alliance News reporter
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