ITM Power has this week provided a trading update, including progress on the UK company’s new factory, updates on two major ongoing projects and some key appointments.
The current financial year ending 30th April 2019 has started well and ITM Power continues to expect another year of significant financial progress.
As has been the case in previous years, revenue is expected to be weighted towards the second half of the year. Underlying performance of project delivery remains on track. ITM Power’s financial position is strong with £16.9m ($21.6m) of cash and £1.7m ($2.2m) of cash on guarantee. Debtors less creditors stand at £8.4m ($10.7m), making a total of cash and cash receivables of £27m ($34.5m).
Dr. Graham Cooley, ITM Power’s CEO, commented, “ITM Power is in good shape – financially and operationally – and I hope this positive trading and pipeline update demonstrates this to shareholders.”
“We are making good progress with the new factory, with the delivery of key multi megawatt reference projects and we have made a number of high-quality appointments to strengthen the team for further growth.”
“Our business is performing well and we look forward to reporting more important new contracts in the near future.”
ITM Power currently has £27.6m ($35.2m) under contract and a further £6.7m ($8.6m) in the final stages of negotiation, constituting a total pipeline of £34.3m ($43.8m), representing an increase of £3.7m ($4.7m) since the full year results announced on 13th August 2018. The non-contracted tender opportunity pipeline currently stands at £200m ($255.2m).
The planned move to the new 11,610m2 floor space factory (with grounds of 30,000m2) is progressing well. ITM Power has designed a new manufacturing process (including introducing new automated technical processes), designed a new factory layout (to optimise product flow-through), completed all of the detailed drawings of the factory, the technology centre and the offices and applied for planning consent. The consenting process has also included a traffic survey and full environmental impact survey. Terms are expected to be signed in Q1 2019.
The new factory will be commissioned and run in parallel with the existing factory until the lease runs out at the existing Atlas Way site in 2021. The project manufacturing capacity ramp up across the old and new factories is more than adequate to support the company’s substantial projected sales growth in the ensuing three years. Product testing is currently a constraint at the old Atlas Way factory as we deliver larger products and so the power supply at the new factory will be commissioned early in the fit-out process.
The EU 10MW Refinery Project with Shell
The project is progressing well. ITM Power has established a dedicated project office and ring-fenced staff to work exclusively on this ground-breaking project. The initial design work has been completed for the planning permit application submission in Q4 2018.
The Project Manager, Dr. John Newton (formerly CIO at RWE npower), is working closely with Shell and their chemical process engineering sub-contractor in preparation for the detailed design phase, to ensure the plant will conform with the stringent safety and compliance requirements of a major refinery.
The project team are attending regular joint technical review meetings at the refinery and will be hosting Shell and their sub-contractor partners, for similar meetings in the dedicated project office in Sheffield.
The Birmingham 3MW Bus Project
This is ITM Power’s first project in the hugely promising hydrogen fuel bus segment and is expected to enhance its competitive advantage for additional future opportunities. The 3MW Electrolyser is built and has successfully undergone initial testing.
The civil engineering works at the Tysley Energy Park are underway and will be completed in December and the refuelling station will be ready for operation in March 2019.
20 fuel cell buses are expected to be delivered in Q2 2019 to commence operation on Birmingham bus routes.
ITM Power has appointed a number of senior managers recently. Nicola Ham Edmonds has been appointed as Head of Legal. Edmonds has some 15 years of experience within in-house legal teams including Bombardier Transportation and the Royal Mail.
Robert Crawford has been appointed as Quality and Health and Safety Manager with more than 20 years’ experience in the electronics, aerospace, automotive, renewable energy and petrochemical sectors.
Mark Theaker joins the company as Head of Procurement with experience gained at Tata Steel, Tarmac, National Grid and EDF Energy.