Extract from a huge IC article published today28 Aug 2020 12:25
At the other end of the spectrum, ITM Power (ITM) is in the business of making electrolysers for green hydrogen production. It is currently constructing the world’s largest ‘polymer electrolyte membrane’ electrolyser for Royal Dutch Shell (RBSB) in Germany. The company’s shares have more than tripled since the beginning of the year, but even before hydrogen fever hit, ITM had attracted investment from a big player – its top shareholder is industrial gas giant Linde (DE:LIN), which paid £38m last year to take a 20 per cent stake. A joint venture between the two companies aims to deliver green hydrogen projects at an industrial scale, harnessing ITM’s electrolysis technology and Linde’s expertise in delivering ready-to-go ‘turnkey’ solutions.
ITM doubled its revenue to £2.4m in the six months to 31 October 2019, but its Ebidta losses widened to £8.3m as income from EU grants tailed off. The company is guiding to a £17.5m loss for the full year to 30 April 2020. It continues to see a net operating cash outflow, although thanks to a £59m fundraising, it is sitting on £41m of net cash.
A record order backlog of £52m indicates demand is increasing and ITM has identified a further £263m-worth of opportunities that it can bid on. But while analysts project that sales will take off this year, costs are also set to increase in tandem, keeping it in a lossmaking position. Brokers have yet to pencil in when ITM might turn a profit.
https://www.investorschronicle.co.uk/shares/2020/08/27/the-fuel-of-the-future/
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