ITM Power Shares Surged 8% on Half-Year Results, FY Guidance

The ITM Power plc (LON: ITM) share price surged 8% after releasing its interim results for the six months to 31 October 2022 and a strategic update. The company’s shares rose despite reporting an adjusted pre-tax loss of £54.1 million compared to last year’s £12.9 million loss.

The company’s revenues also fell to £2.0 million versus the £4.1 million generated in a similar period last year. Yet investors remained hopeful that the renewable energy company shall recover given its massive cash balance of £317.7 million at the end of H1 2023 compared to £164.2 million at the end of H1 2022.

ITM Power’s trading results for the first half of its 2023 financial year were not impressive. Yet, the company, which designs and manufactures electrolysers based on proton exchange membrane (PEM) technology to produce green hydrogen using renewable electricity and water, was barely affected. 

Instead, investors chose to focus on some of the milestones achieved by the firm, including the signing of two 100 MW contracts with Linde Engineering to construct the largest PEM electrolyser system in the world today.

The company is also deploying the new Linde/ ITM Power 10 MW standard modules built on state-of-the-art 3MEP 30bar stacks to be installed at RWE's site in Lingen, Germany.

ITM Power noted that it remains focused on the core product suite within its portfolio, given that its products have robust validation. The form is entirely focused on scaling its manufacturing activities. The company has also adopted a rigorous approach to cost control and will be slashing headcount to save up to 9% of its annual operations costs. 

The firm is also seeking to review its joint venture agreement with Vitol to exit the Motive Fuels partnership, which would save up to £28 million, to be redirected to its core operations.  

Furthermore, ITM Power expects its annual revenues to remain stuck at £2 million due to the deferral of additional revenues to the next financial year. At a valuation of over £576 million, it is pretty disappointing to see a company generate £2 million in revenue over a year. 

The firm expects its annual losses to be between £85m and £95m. 

*This is not investment advice. 

ITM Power share price. 

The ITM Power share price surged 8.03% to trade at 96.58p, from Thursday’s closing price of 89.40p.