ITM Power has had forecasts for 2024 revenue slashed by 60% to £29mln by US broker Jefferies, which is also predicting a weaker long-term outlook.
Overall, Jeffries forecasts 2023 revenue to be 12% lower than before but warranty issues mean 2024 revenue is expected to be around £29mln against previous forecast of £75mln.
Jeffries stated that “delivery of tooling equipment associated with manufacturing of its first-of-kind 2MW MEP 2.0 stack” is not expected until next month.
If contracts can be delivered on time revenue is expected to be at the bottom end of guidance but any further slippage and “there is material downside risk to guidance.”
ITM using a first-of -kind product with higher warranty provisions due to lack of data.
Any more delays could lead to a £45-50mln reduction in earnings guidance and ‘material new project wins are now needed to underpin revenue growth expectations’.
The broker’s price target is reduced to 105p from 185p.