ITM Power's £86.5 Million State Backstop Meets a 150MW Refinery Ambition

ITM Power has secured £86.5 million in public backing, a sum that gives the British electrolyser maker room to press ahead with factory investment even as it works through the costly transition of its order book toward higher-margin work. The Sheffield-based company's shares closed Friday at €1.09, up 2.2% on the day and 51% higher since the start of the year — a run that reflects both the strengthened balance sheet and recent operational progress.

Two Funding Streams Behind the Cash Position

The cash cushion rests on two state-supported steps. Great British Energy took an equity stake worth £40 million, while the Department for Energy Security and Net Zero (DESNZ) granted a conditionally drawable £46.5 million subsidy. Those funds are earmarked for a Chronos manufacturing line with a capacity of one gigawatt.

Thanks to the inflows, the company ended its financial year with £215.6 million in cash, up from £207.0 million a year earlier. Management projects a cash balance of between £170 million and £180 million for the following fiscal year 2027, a figure that reflects continued outflows for operations and expansion.

Contract Quality Improves as Losses Shrink

Alongside the capacity build-out, the makeup of ITM Power's business has shifted. The order book stood at £144 million at the last count. The quality of those contracts matters more than the headline figure: the share of profitable contracts climbed to 83%, up from 60% in the previous reporting period.

The annual numbers provide the backdrop. Revenue reached £43.6 million, while the adjusted loss before interest, taxes, depreciation and amortisation (EBITDA) shrank to £20.2 million from £33.0 million previously. CEO Dennis Schulz described the outlook for green hydrogen as promising.

Guidance has since been tightened further. Roughly two weeks ago, ITM Power improved its forecast for fiscal year 2026, which closes on 30 April 2026, limiting the adjusted EBITDA loss to between £20 million and £21 million. That marks a 27% improvement on the prior loss guidance and 38% against the previous year. Revenue and liquidity expectations were left unchanged. Peel Hunt rated the stock "Hold" on 8 October following the upgrade.

A Refinery Anchor for the Project Pipeline

A central plank of the future build-out is Hydropulse, the subsidiary focused on building, owning and operating plants. About a week ago, it signed a heads of terms agreement with a European oil refinery for a 150-megawatt green hydrogen project, with a ten-year contract term envisaged.

The scale of the undertaking comes with a long planning runway. A final investment decision is targeted for 2027, with regular production scheduled to begin in 2029. ITM Power did not disclose the name of the refinery operator in its announcement. Even so, the letter of intent underlines the push to build dependable revenue streams through large industrial projects.

Shareholders Face a Narrower Equity Authorisation

Formal decisions await investors alongside the expansion plans. For the annual general meeting on 30 October 2026, the company revised its convening notice regarding resolution 11b. The proposed aggregate nominal amount for the issuance of equity securities was cut to £23,046,852 from an original £34,570,278. Shareholders will vote on the tighter framework at the end of the month.

Analysts Split on Valuation

Opinion on the stock divides sharply. Berenberg sees a price target of 200 GBX, while JPMorgan is far more cautious at 80 GBX. Investors are weighing whether the solid liquidity and the higher-margin order book can offset persistent operating losses over the long haul — and how efficiently the pipeline can be converted in the years ahead.