Member Info for toneman

Yes, hopefully we'll get a "Notification of Major Holdings" in the next couple of days to explain what went on, or an identifiable change in a short position.

Jeff I think it would be a lot easier to find institutions who've placed a broad spread on the off chance that they can pick up sharesdown at 35p if someone has a load to sell them. Can't see how you find the same quantity in sellers down at this price. I know full well the UT is sell/buy matched, I've already said as much.

The point about the UT, Mark, is that whichever way you paint it, positive or negative, it's an equal trade - same number of buys and sells matched at the same price. That's what makes it special about the UT. So if you're saying "where are you going to get all the buyers to match my 'sell' argument", then you have to also say "where are you going to find that many shares for sale from 'normal' investors at that price to sell back to the shorters". I think you'd have to buy into Jeff's argument that they're receiving some sort of kick-back incentive to play ball. Personally I don't buy that theory.

If it was sell-driven as I suggest, then it could also be something like institutions selling out of ITM to buy into PLUG (or others) instead given whatever the big move stateside could be about. Plug seems to be up big, as does Ballard and FuelCell, so it's possible some big investors have decided to switch teams and chase whatever is happening over there. I haven't Googled yet to see what's happened over in the US today.

That's essentially a conspiracy theory then Jeff. You're trying to convince us all that's the most likely cause?

It could also be a mistake. There was a huge trade on another stock I saw a couple of months back and it was eventually taken away because it wasn't real.

As the price towards close of play was closer to 36p, doesn't the UT trade at 35.3p suggest it was a sell-driven auction. Perhaps we could be looking at one of the shorters increasing their position rather than reducing. A large sell request could easily be matched by the spread of people willing to buy the other side of that position as low as 35.3p. Makes more sense to me than people being tricked into selling at 35.3p just to allow a shorter to close out a position.

Good points Julius. A useful reminder.

Thanks Lutra.

I'll do a bit of research along those lines.

I do hate it when accountants get 'creative'. Always leaves me wondering what they're trying to hide.

@troublesome, very good point. Certainly something worth clinging to.

It's disappointing that they're also heavily backing CCS though which still fills a large portion of my original negatively positioned argument. But, yes, at least they haven't abandoned true green hydrogen yet. There's some hope left.

Changing domicile to the UK seems fair enough, but I don't understand that Reduction of Capital bit.

How can it generate distributable funds of £4m whilst at the same time not generating any cash for the new entity?

Perhaps someone with a bigger brain than mine can explain what's really going on?

I think you are intentionally missing my point Jeff.

Jeff, ITM would likely need the 250MW per year even to qualify for a loan. Loans generally aren't given to companies just to support cash-burn. They're given on the basis of the liklihood of being able to service the loan and ultimately pay back that loan. If it were so easy to just get a loan to maintain cash-burn then so many companies wouldn't go bust would they, they'd just go and top up their existing loan ad infinitum. Banks don't work that way. Perhaps it's you who need a refresher on how business loans work.

You're also a little optimistic to be painting the 500MW and the Shell contract as reaching the 250MW annual run rate I'm suggesting is required. They certainly don't meet it on their own and my emphasis is on the annual requirement, not these one-off trial builds. We need a couple of 1GW orders with a multiyear build out before we can be confident that this business can survive. I will be as delighted as you will be if those orders materialise as I hold plenty of shares here. But I've said before that I called 2025 as the timeframe we'll learn if electrolysis (and ITM) will be successful, and we're getting perilously close to that now and it, so far, remains unproven. The next 12 months is critical.

Troublesome, quite a lot has changed since I was buying at these prices last time.

It was Feb 2017 when the first Shell refuelling opened at Cobham services with ITM's refueller that first caught my eye and I bought the stock. Most (affordable) battery cars were still only capable of travelling about 50 miles. So unless you could afford to buy a Tesla, battery cars seemed like the wrong choice to me as they took so long to recharge. The quick refill of hydrogen seemed like a far better option. So that's changed. The industry now seems 100% set on battery cars (for now?).

There weren't as many companies competing in the electrolyser space and ITM seemed to have the most compelling tech. Now both Plug and Nel compete directly on PEM, and CWR is a promising option where you can scavenge waste heat too, and CPH2 has an interesting membrane-free solution.

Also at the time, the oil majors seemed as keen to embrace the idea of including electrolysis as part of their generation mix, but now they seem to be 100% convinced their CCS is the answer instead, and they've captured many politicians too.

Other than PLUG, no-one is willing to take the 'build it and they will come' approach, and so will only build electrlysis if there is an offtake agreement. Offtakers are busy waiting for either a government handout or confirmation of a successful CCS implementation to avoid change.

So, sadly, yes I now think there is less growth potential than there was in 2017. Smaller market, more competition, and lower commitment. And now that ITM are burning through so much cash, building and now running a fairly empty factory, it looks tricky (50:50) whether they can reach profitability before the cash runs out.

I know Bilbs warned us all about 'hope' this morning, but it feels a little like I have to just hope that my original thesis still comes good. However, I've been right about stuff before but just not at the right time. In this game you need to be correct, be at the right time, and have everyone else agree with you, otherwise you still lose.

Thanks Rick. Yes, sadly I tend to agree that the risks are a bit high to add more to my holding. I've lowered my average on several stocks before that ended up bust, so no stranger to that fallacy either. Oooh, each time it seems so tempting.

It still seems obvious to me that electrolysers match so well with wind power, but the suits who make all the decisions just don't seem to share that view. I'm pretty sure they'll load up with batteries rather than electrolysers. And if we keep talking only of using the excess wind then the other argument arises that there won't be enough excess until mid 2030's. So whichever way I look it just seems like the electrolyser market is still 10 years away. To be fair when I first invested I always thought that it would be a mid-2030's win. I didn't expect the hype to come along with Greta Thunberg and for everything to spike at Jan 2021. Now the competition seems so fierce too, even PLUG, CWR and CPH2 weren't in electrolysers when I first invested. But since then ITM have expanded their operation with little additional revenue but massively higher costs. Lucky they cashed in with that last funding round otherwise they'd have been toast already.

I think for now I'll heed your advice and leave this falling knife a little longer. I've got plenty of stock if it manages to recover on it's own, I don't think it needs more throwing at it. Thanks.

I'm trying to work out whether I think ITM can survive. Don't jump down my throat, I'm a long term holder...way too heavily invested in tons of clean energy stocks.

But progress in the green hydrogen market just doesn't look strong. It's understandable when you consider that hydrogen offtakers keep being thrown the bone of Blue Hydrogen from CCS. If I were an industrial user of hydrogen and expected to have a plan to lower my carbon footprint, I'd also be clinging to the idea that my existing supply channel is going to clean itself and thus automatically pass on the carbon reduction down the line to me without me having to lift a finger. I'm promised it'll be here between 2027 and 2029, and 30m tonnes of the stuff by 2030. So no point in wasting money trying out an electrolyser alternative is there? I can always switch to that if the CCS stuff doesn't work.

So my concern is that we may be waiting until the early 2030's before the next wave of proper interest. ITM could have run out of money by then which would be catastrophic.

If they can find an annual market for 250MW by 2027, then I'm thinking that's just about enough to stem the cash burn rate. And if they can demonstrate that along with growing revenue then I guess they'd even survive a funding round.

I just don't know whether to double down at these low prices... amazing - same prices I was buying the first time around.

That's hilarious though. They're talking about an annual saving of only £35 per energy bill, and not until 2050. That doesn't sound like a persuasive argument.

We'd probably fare better if they held off a trading update unless they've had some really good trading they want to tell us about.

There's a lot of negativity today around clean energy stocksfollowing the Trump victory and his apparent negativity around the green agenda. But here's an alternative, particularly for the hydrogen space. We have seen over the last few years a lot of delay for FIDs whilst businesses wait to see if there will be a government grant or similar support for their project. Take that away and what options are there? Either abandon the project or just get on with it. There's still plenty of investment money around without relying on government grants, so I've a suspicion we could see a lot more of the latter regarding projects in America.

Thank goodnes for IES. It's my only blue in a staggering sea of red today.

Presumably there's a whole pile of market selling today as UK investors cash in all their capital gains and losses before the tax-rate skyrockets tomorrow.