ITM Power Plc (ITM) Earnings Call Transcript & Summary

Good morning, and welcome to the ITM Power Plc Interim Results Investor Presentation. [Operator Instructions] Due the number of attendees on today's meeting, company may not be in a position to answer every question received. However, the company will review all questions submitted today and will publish responses where appropriate to do so on the Investor Meet Company platform. Before we begin, we'd like to submit the following poll. I'd now like to hand you over to Dennis Schulz, CEO; and Andy Allen, CFO. Good morning.

Good morning, and good morning, everyone, on the call. Thank you for taking the time to participate. I would like to start by introducing myself. My name is Dennis Schulz, and I took over the role as the new CEO of ITM on 1st of December '22, which was 2 months ago. It doesn't feel like that, I have to say, but just 2 months ago. Having with me 14 years of experience in the technology and EPC industry and related component manufacturing. I joined Linde in 2008 and had various positions in the company, among them as Head of Project Execution Services and as Head of Strategy and Mergers and Acquisitions, both in the company's headquarters in Munich. Since 2017, I led the restructuring of one of the sizable EPC entities in Dresden, Germany, first as the CFO and then later as the Managing Director, taking over from my predecessor in 2020. During that time, I restructured and reshaped the company towards a new product portfolio focused on predominantly green technologies in the area of CCUS, which is carbon capture, utilization and storage; and hydrogen, predominantly blue and green. In that capacity, after Linde's investment into ITM, I was closely involved in the strategic relationship of the 2 companies. And we had a great start by securing important customers, reference projects and developing a 10-megawatt standard module, which will be deployed for the first time in the projects announced today, the 2x100-megawatt Lingen projects in Germany for RWE. But after a promising start on the sales side, and I have to mention that all the ITM projects, which were running through Linde, were in my profit and loss responsibility from sales to execution. We found that ITM's project performance was falling behind expectations. And after that, I was then closely involved in collaborative efforts to try to overcome the issues jointly and mitigate delays to customer projects. In my role as Managing Director at Linde Engineering, I was also working with other electrolyzer OEMs, despite the most intimate relationship being with ITM. This certainly put me into a position where I have gained significant insight on the strengths and weaknesses of the different electrolyzer OEMs in the market. Personally, I'm a strategist, passionate chess player. I have a track record in restructuring and in turnaround, leading organizations. And I'm well connected in the industry, with customers and suppliers alike. I will now first hand over to Andy Allen, our CFO, to present you the interim numbers before I continue with the priorities going forward.

Thanks, Dennis, and good morning, everybody. Thank you for joining us on the call this morning. So I will go through the interim results. They've been published this morning. They show a performance that's unacceptable and need some measures to address them, and that absolutely can be part of the 12-month priorities in Dennis' presentation. So I'll also take you through the revised guidance for FY '23 and give you a steer towards what we might expect in FY '24. So in terms of the performance, the revenue for the half year was GBP 2 million against GBP 4.2 million the year before. Gross losses were GBP 45.6 million against GBP 2.6 million the year before. And adjusted EBITDA losses were GBP 54.1 million against GBP 12.9 million the year before. The important thing here, and we'll go into some detail here, is that the bulk of those losses are noncash movements, provisions-based against project cost overruns and inventory costs. But we'll go into some more detail very soon. In terms of cash, we had GBP 318 million at period end against GBP 164 million the year before, a function of the capital market raise we did just over a year ago. In terms of cash flow, total cash outflow for the period was GBP 48 million against GBP 12 million the year before. There's GBP 42 million associated with operating activities, and some of that is the buildup of inventory. And in terms of investing activities, there was an outflow of GBP 6.4 million, which includes GBP 7 million of expense for capital projects. So the summary is we raised money to pursue an aggressive expansion strategy. And in doing so, we underestimated the skills and competencies that we required as a company to really get that volume going quickly. So that's led us to where we are today and the numbers that we are seeing here. And we need to absolutely get from being an R&D company to a volume manufacturer of an industrial product. In the last 2 months, we performed a deep dive into the contributing factors, and I'll share some of those on the next slides, and you'll see more in Dennis' plan to follow. The vast majority of these actions will hit and impact FY '24 and not necessarily make the guidance for this year change. So in terms of the summary, the revenue was GBP 2 million against GBP 4.2 million a year ago. A year ago, though, we did have a funded prototyping from BEIS, GBP 2.8 million for prototyping next-generation stacks. You do see that actually product revenue is marginally up year-on-year. In terms of a case study, the Leuna projects is the flagship that we need to talk about. We have experienced both delays, and we've also seen a change in our delivery scope. What we're doing is we're splitting our deliveries. So the project consists of 12 2-megawatt modules. In the first half of the year, we completed factory acceptance testing for 2 modules. But as we've had delays, we've worked with Linde and the customer to really get the best and optimized delivery schedule. That means that we will split the delivery of the Cubes and the stacks for the remaining 10 modules. So as of today, all the Cubes are on site. They are being installed, and they now await the stacks that we will produce and to send to site. So for us, revenue recognition is about finishing an obligation. And the obligation in Leuna is the testing of the module, so a Cube and a stack. The first 2 modules tested at FAT as a complete module means we can recognize revenue. For the last 10, they need to meet on site, and we recognize revenue as they are deployed and tested on site. What does that mean for us? Actually, revenue is going to lag behind the work that we're completing for projects. And we're also going to see -- we're now dependent on the wider SAT of the plant. So it's not fully within the control of ITM. This may affect other Cube projects, including Yara. And that's one for us to be aware of. So this is not revenue loss, but revenue deferred. In terms of gross margin, the gross loss was GBP 45.6 million against a loss of GBP 6.8 million the period before. There are 3 contributing factors here: project cost overruns, inventory losses and warranty provision uptick. And this slide covers both warranties and the project cost overruns. So against the full portfolio of GBP 49 million worth of revenue, we've seen overruns in the period of GBP 29.9 million. The contributing factors to that, if you look at the graph first, you see actual costs incurred in the period of GBP 10.4 million. We see expected costs that are part of delivering projects of GBP 9.4 million. And then you see a risk-weighted provision for GBP 8.5 million, which is about really being much more stringent and disciplined with our approach to risk. The very bottom down there is our provisions for warranty. It's split into 2 bars. GBP 2.3 million is the warranty for and against warranty provision for products on-site. The GBP 1.3 million will sit within contract loss provisions up to the point that the kit is deployed. And then at that point, it'll come in provision. So what's driving these numbers? The big thing here is redesign work. We built products at a point where there was an unfinished design. And subsequent design changes have required rework of various products. We've also included customization at customer request. And as a company, we haven't fully understood the impact of those customization exercises. Also seeing the split of scope, as talked about, in the Leuna project, that's actually going to increase cost for ITM, and we see that as something we need to do to maintain the customers' timelines as best as possible. But it's more on-site work, more subcontract work and more packing. And finally, in terms of testing, we had expected to see improvements within our testing timing, which have not yet materialized, based on the fact we're not doing volume manufacturing right now. So the costs are related to both, the longer test durations, but also the impact of the energy prices for the company. The other contributing factor to the gross margin loss were inventory losses. And that's made up of a total cost in the P&L of GBP 15.7 million. Costs incurred, which is write-offs and obsolescence of GBP 1.6 million is one number, and the other component is GBP 14.1 million worth of provisions. This is against a generation of stacks, population of stacks that is ring-fenced, let's say, 100% provision against those stacks. What happened there is there was a legacy design, which included the introduction of an extra component to make tolerances easier to manage within the manufacturing process. That ultimately led to us having a product that we did not want to ship. So at that point, there's the need for a new tool modification, which was the RNS that we put out in Q4 last year. So the tool modification has been done. Components are being manufactured. Stacks are started to be manufactured. It will be easy right now to say we are sprinting towards completing customer projects. But we're not doing that. We're taking it step-by-step and making sure we validate the stacks that we do, so we avoid doing this again. In terms of cash flow for the period, we had an adjusted EBITDA loss of GBP 54.1 million, GBP 32 million of that were provisions, noncash movements, leaving us with a cash outflow from the P&L of GBP 22 million. We saw an uptick in inventory of GBP 29 million. We've improved our working capital position with receivables and payables by GBP 8 million. And then we spent money on the CapEx, notably about GBP 3.5 million, on assets with investment funds and a similar amount on product development. So our total cash outflow for the period was GBP 48 million. I've got a little box on the left-hand side, which just acknowledges that of the GBP 28.9 million inventory uptick 14.1 million was provided, and that's, that generation of stacks that we've just spoken about. In terms of the guidance for FY '23, ending in 30th of April, so the result is very much baked in from decisions that we made in the first half of the year. And we're not going to see the benefit of the 12-month priorities plan until FY '24. So the revenue guidance, in line with that change of product delivery -- project delivery means that we expect revenue to be GBP 2 million for the full year. And that's the same number as we announced today in the interims. In terms of the EBITDA loss guidance, we're expecting that to be in a range of GBP 85 million to GBP 95 million. We're expecting to see some inventory provisions in the second half of the year, and that will be about FAT success and volume of products going through the shop floor. And we're also -- we're applying contingency here, which is within that range, about project cost overruns we don't know about. It also includes the costs associated with the RWE and particularly the warranty. And finally, it includes the overheads at a similar run rate through the first half of the year, but also we're going to have one-offs for redundancies and the impairments of discontinued products. In terms of cash flow, our cash flow guidance hasn't changed for the full year. We guided before GBP 245 million to GBP 270 million. Actually, we also expect that to be towards the lower end of the range, partly because inflows from customer contracts have been deferred in line with delivery profiles. And outflows are impacted by project overruns and an unwinded provision made, to a partial extent, in the first half of the year. Final slide for me, the outlook for FY '24. So revenue is going to be underpinned by site acceptance testing and a dependency on that. But particularly, our focus here is Yara and Leuna, getting them down as pilot plant, as flagship plant that we can really use to showcase what ITM can do. In terms of cash flow from operations, we'll start to see the benefit of the 12-month priorities and headcount reductions and cost management. We'll also expect to see an unwind of some of the inventory buildup we have this year as we start to see products go out the door. In terms of investments for the future, we are expecting to invest in a power upgrade and fit-out of a new unit. And there will also be incremental automation machinery as we bring that online in FY '24. I'll hand back to Dennis for the priorities plan.

Thank you, Andy. Let me pick up where I left you, which is my introduction. Before I committed myself to ITM and knowing about the issues the company is facing, as I alluded to, I asked myself 3 questions, which were important for my questioning to join or not to join, I have to say. These 3 questions are, does ITM have a technology with the potential to outperform its competitors. Does ITM have a strong enough balance sheet, which means cash, to support the necessary strategic and operational changes I was anticipating, to strengthen the company's foundation? And does the market give us the time window needed to solve the growing pains ITM is encountering? And in short answer, yes, I'm convinced that these critical preconditions are met, as I wouldn't be sitting here in front of you today. On the technology side, as I also said, I do know what competitors are doing from my previous role at Linde. And I'm more than convinced that ITM has the right technology to compete in the field. I will shed some more light on answering the questions on the next slide. I know this is content-heavy, and it's probably difficult to read. But bear with me, I will try to guide you through step-by-step. So first, a high-level business update. Discussions around climate change, decarbonization and recently especially around energy independence, coming from the Ukraine-Russia situation, are further fueling the projected hydrogen demand increase. And I can tell you they are really is coming from the customer side of the industry, and we would expect the demand to be sustainable this time. So we will see significant investments coming up. If we look at the landscape of hydrogen production today, you will see that 95% of that is still gray, which means it comes with a lot of CO2 emissions, not really well aligned with the decarbonization agenda. However, just the demand increase alone on top of the installed capacity is higher than what electrolyzer OEMs can supply today in terms of green hydrogen stacks, even if you take all the announcements out in the market for new factories, giga factories, which I have to say are, to a large degree, shaky. But even if you just believe in all of them, electrolyzer OEMs will still not be able to meet the demand at this point in time. So we will see significant investments in that industry going forward. And even if electrolyzers were able to supply stacks in the sufficient amount, we would have another bottleneck, which is then the availability of green electricity, because the ramp-up of renewable energy is lagging behind in most countries nowadays. But also there, I think we are gaining speed. Especially for the already installed base of steam reformers producing hydrogen, we will see a trend towards blue hydrogen for the interim, which means that we capture and store CO2 and sequestrate it. And while this is an important interim step to also allow tackling the next bottleneck, which is hydrogen infrastructure, I would expect new installations to turn towards green hydrogen. When I say hydrogen infrastructure as a bottleneck, I mean transport possibilities from pipeline to last-mile handling, shipping, I think you all know these discussions, and also storage for energy buffering, especially when we talk about higher share of renewables in the energy grid we need to part of. And current peak electricity prices and inflation, that's no secret, put electrolysis business cases under a lot of pressure, which leads to some delayed investments. That is a temporary effect, which is giving us, ITM, now the breathing time required to overcome our issues. The big demand spike is yet to come, and we will see significant ramp-up of projects in the next years. And we, as ITM, will be ready for that. While we are working on our foundations, I can tell you that almost all competitors in the market are facing similar issues. We were a little bit ahead of the pack in that. We won the first important and larger projects in the market, and we encountered the issues first. I hope that we can also be the first ones to overcome the issues and emerge stronger out of that. When it comes to product demand projection, order intake weighted today container business, so plug-and-play units, and stack alone, as we would supply for Lingen, are rather even today, while -- and this is illustrated in the bottom right graph of the slide. While we would expect container sales to see a moderate increase, the demand for stack will be substantially larger, and we would expect an exponential growth, given the larger scale of projects in the market, which I think you wouldn't buy containers for 1 gigawatt project, obviously, right? Therefore, ITM will focus more and more on stacks going forward, which doesn't mean that we don't do containers, but it will mean that for containers, we will try to narrow ITM's scope to where we can add maximum value and pursue partnering opportunities for the non-core scope to [ increase competitiveness of plant in context ]. In order to develop ITM from an R&D company to a professional delivery organization with volume manufacturing capabilities, we also need to check the inherent overconfidence in the business previously and replace it with what I would call industry realism. We have developed a 12-month priorities plan to achieve the exact design and to solidify our foundations. I clustered our plan into 3 focus areas. First one is that we need to concentrate on a core product suite to finalize the engineering of our technology, which is in itself performing well, but we need to get to repeatable and reliable volume products. While the previously mentioned manufacturing issues are there, they mostly originate from engineering shortcomings. And when I say that, I mean design freezes and not robust validation of product generations prior to release for purchasing and production. So it's not the technology on the electrochemical side, it's the engineering around that which is not mature enough. Second point, the -- we need to stop the financial bleeding of ITM. And we just alluded to the numbers. We'll introduce a short-term program to reduce cost and which addresses the key cost drivers of the business. I will say a few more words to that in one of the next slides. On top of that, we will review together with Vitol and future for Motive Fuels with the aim to save us GBP 28 million of already committed investment and [ reboot it ] back to our core business where we need it to scale up production and focus on our core business. We will also work on substantially increasing the quality of our forecast in order to build back market confidence in ITM. And these proceed today as being a first step in that direction. I think the degree of transparency we provide today is a step change for ITM. The third point is debottleneck and debottlenecking. We will ramp up fabrication and testing and invest into incremental automation. Andy just mentioned that, I have a separate slide on that part. In parallel, we cannot overstate how important it is to deliver on our project commitments. We need to become a delivery organization. We are a commercial company, and we want to grow into becoming profitable at a point on our journey, and we have to learn from mistakes from the past. We today announced 2 Lingen 100-megawatt projects. It's a very important milestone on that journey, which allows us to scale our business with real contracts and not just towards a perceived demand, but with a real demand. With these 2 projects, we have almost 270 megawatts of latest stack generation in actual project delivery today, which is significant for us. I will now give you more details on these 3 focus areas on which you see with the blue dots. On the left, this is a list of all the products which ITM is today working on in one or the other form and in chronological order of development in existence. I have to say that this was a bit shocking to me after I joined it. It's a lot to focus on. And we definitely need to narrow down focus in order to be better performing in our state-of-the-art technology and products, which is those which we marked in green. The services we are still providing to support older-generation technologies are disruptive to our engineering and manufacturing processes. They distract the organization, and they have become overall too costly and time-consuming. So what do we do about that? We will discontinue product development and ongoing design improvement work for legacy products which are no longer considered state-of-the-art. All the products on top of the green ones with the white background, we will stop marketing and selling of these products, and of course, our customers will and should be able to expect from us, and we will live up to that to fulfill our remaining contractual commitments and warranty obligations. We would not back down from that, but we will narrow after-sales services to the later product generations to avoid distracting the organization too much. The green highlighted, 30-bar MEP stack is the one we will scale and deploy in the current and larger installations to come. You see there that Cubes are light green colored. We still intend to sell Cubes, but we would expect the market to develop in a direction with either a rather small decentralized installation tending towards plug-and-play containers, which is like a complete plug-and-play unit as opposed to a Cube. All then going to the big, large-scale projects, which would then rely on this stack and skid supply together with a larger module, in that case, for example, of the 10-megawatt module developed with Linde. In that sense, the strategic relationship with Linde is very important for us to take the large-scale projects to come. To allow us to narrow focus on that, which is really important, we have consciously paused on a completely new stack generation for the time being, as what I just said, the current state-of-the-art in the industry. There's no need to rush to the new project generation instead of scaling up what we have. And we showed you the numbers, which have been disappointing for the first half year and which continue to be disappointing for the second half of the year. In order to stop the financial bleeding of ITM, we need to tackle the main cost drivers, which are underlying. And I tried to come up with a symbolic picture here a little bit. While the ship of ITM, which is not really horizontal right now, we are -- should have uplifted by technology, which is great. Huge market demand. Right now, we could sell more than we do. We consciously try to not oversell in order not to overstress the organization at this point in time. It's not a problem that we couldn't sell, I can tell you, and a strong balance sheet and cash position. This is certainly an uplift. But we are, at the same time, also pulled down by project cost overruns and inventory losses, as Andy just explained, and also by overcapacity as a result of overoptimistic recruitment towards unrealistic expectations of fabrication [ members ]. So we will have to cut off one or the other of these wastes, if not all, in order to steady the ship and try to become faster and more capable company. Addressing the overcapacity is an important first step. We will restructure and rightsize our organization towards being leaner and flatter in hierarchy and with a structure that's reflecting the true nature of the business. We will strengthen technology, and in particular, we will strengthen engineering and product validation focus, which were the reasons for most of the issues we are encountering today. We are bundling our customer interface from sales to delivery in one customer-facing organization. And we will closely integrate manufacturing and procurement, which is essential. We will also increase the oversight and governance function of the CFO organization, especially with focus on getting to better forecast, as I alluded to earlier. And today, we also announced that Dr. Rachel Smith will step down as a statutory Director from the Board. Let me thank her this time for the tremendous contributions she has brought to the company. Rachel will continue to work with ITM in another role, and I'm looking forward to continue working with her. Coming back to the organization. We will reduce around 25% of headcount, which leads to a reduction of personnel cost of GBP 9 million year-on-year, which relates to or equates to 30%. We will overproportionately reduce in non-scaling functions, which means that these are sustainable savings and meaning that if the business is picking up again, these functions will not scale with the business going up. And implementation starting immediately is certainly subject to employee consultation starting in February. So how do we solidify our foundation? On this slide, you see on the one -- on the left-hand side, mitigation for future inventory losses, which Andy alluded to. And then on the right-hand side, you see mitigation of future project cost overruns. And when I guide you through these points, you will see that most of these are business basics, especially in the EPC and manufacturing industry when you look at mature organizations. But this is the topic -- these are the topics, which we really need to address now in order to become a capable volume manufacturing company with the required engineering professionalism. And by guiding through these, I think what also comes to the surface is that these are the issues which we need to tackle. It's not an inherent technological issue per se. So let's go through that. In design, we will need to professionalize how we do engineering. This means we need to bring in new capabilities, mend the capabilities we have and improve processes. Today, I can announce that we will have a new Head of Engineering joining us, someone I know from my previous Linde career and someone who I am 100% convinced of that he can help me fix the issues we have. And as I said, he will start today, so things are underway. We will introduce design freezes, which is among the most important things we need to change in engineering and very stringent management of change. We need to stop changing products while they are being produced. I don't need to explain you that this leads to additional procurement efforts, delays and costs. Compliance and validation function, and the emphasis here is on validation, with veto and sign-off right to challenge the status we have. We need to properly validate products before releasing them for production and purchasing and selling them to customers. And this is what we have changed immediately. Then we will have to introduce state-of-the-art calculation, simulation tools. Also from a 2-landscape point of view, there is room for improvement. And so this will also lead to better engineering results. On the sourcing side, we will improve supplier audits. That is another inherent issue which we encountered, I would say, pull supplier quality on one or the other component and let rework to be done. And this will also include on-premise inspections at supplier premises and witnessing testing, which will then also reflect the risk profile of individual suppliers. We will strengthen also our standard T&Cs with volume and specification flexibility. And we need to strive towards back-to-back warranties with suppliers, which, especially for container business, cover us for the complete duration of warranties we give also to our customers in order to avoid having to provide too high warranty [ funds ]. On fabrication and warehousing, we will enhance parts traceability from incoming to shipping, and we will work to our newly implemented ERP system, which has been implemented and which is currently being set up for the complete organization. In terms of avoiding project cost overruns going forward, we -- if we look at the product portfolio and sales, phase first, we will enhance discipline around selling standard products as opposed to customized solutions. Andy mentioned that already. This is a typical theme, which is leading to losses in such kind of organizations like ours. Certainly, we do strive to selling a standard product because it's really hard to estimate accepting clients and contracts and then having to change for each and every client every standard product you have. That's not a sustainable model. So this is one of our key priority areas. Also, we need to come to comprehensive costing and pricing, and we need to be more realistic on schedule and risk estimation. When I look at the current project delays, certainly a lot of that has to do with what I just said on the design and immaturity of designs, but it also has to do about being overoptimistic on the capabilities to deliver and not seeing realistic roadblocks on the way. Contract terms, we need to strengthen that towards accepting lower liabilities. Customers will not be pleased to get it, but that's where we are, and we need to scrutinize our performance guarantees and warranty obligations in the contracts going forward. Project governance. So during the project execution phase then, we will introduce a very stringent phase gate process model, which we will strictly adhere to which means if we have not achieved all the steps required to pass a gate, we will not pass the gate, but we will make sure that we have a very stringent way of managing projects, products and customer delivery from here onwards. We will also strengthen accountability across the business, which is, I would say, an inherent cultural issue at this point in time. It reflects the R&D nature of the company. We need to come to a point where accountability reflects that of a mature delivery organization. And we will also reset one or the other role profile and expectations from roles, including those of project managers, to be more accountable for the project performance. And we will also substantially improve the quality of project cost and risk reporting and the basis for every forecast, which the finance organization can put to the market will be realistic understanding of where projects stand and which risks are ahead of us. And by introducing that, we will take it as where we're forecasting [ problem ]. And we will also advance our core project management processes and very strict governance and improve also the way we manage contracts through our projects in terms of how we address the changes coming from customers throughout the contract execution period. This brings me to number 3 of the focus areas, which is debottlenecking. I have now picked the 3 most important bottlenecks I see for the time being. The first one being testing and power supply. We anticipate and plan for a phased approach to increase test bay capacity to satisfy the project needs on the contract, including the Lingen project, which is certainly a step change for us. We will see more than a doubling of our capacity in testing within the next 12 months, so until December 2023. And from April onwards, we will have available 50% increased electricity supply from 5 to 7.5 MVA. And we will see a further increase, which we have already secured just at the beginning of the year now, to 30 MVA in 2024. On fabrication and automation, a topic which was oftentimes talked about at ITM, we are making this happen now. So we do have an automation road map developed and in actual implementation. We will not be able to read now what's on that road map because it's really small here, and I think it's not important to go into each and every step. But the -- what you see here as a small bar, this is more -- this relates to machines coming in, being validated, tested and then released into production throughout the course of this year, this calendar year. So some improvements were achieved already, and a lot of others will come. And this is a realistic assessment of when we will be able to introduce which change. We will, as I said, incrementally deploy into production. We will not rush that. We will make sure that before we change the process that we have validated and verified that we can do that. One example is a machine on process automation we will expect for October this year relating to automated screen printing of catalysts onto the membranes. Just to give you one example, this relates to precious metals. We will reduce waste by automating that process step, and we will reduce cycle time from 10 minutes to 6 seconds, and by that, increase production capacity by 300%, especially also on the reduction of process waste when it comes to precious metals that will be a game-changer for us. That's just one of a lot of examples of what we have in implementation. On the very right, last but not least, R&D and validation. We are currently in negotiation to expand our shop floor space with the new fabrication just next to Bessemer Park, where we are today. We do want to build up our dedicated R&D and product center. So this topic of validation comes up again and again. This is really important to me. And this will science labs and first-of-a-kind product testing facilities and will also share the electricity I just mentioned across supply. And this has not been signed, but we are in current negotiations, certainly also assessing other options as an alternative if the negotiation doesn't come to success or conclusion. We do expect a decision still in Q1 this year. My last slide, outlook. I talked a lot about the next 12 months because these are essentially the size of ITM. I know that you have questions for the longer-term strategic plans. Around what about more production volumes. And let me answer that maybe in a way to be able to still focus on the next 12 months. So ramping up stack output is not difficult for us but it requires robust product variation. We need to make sure before we enroll into volume manufacturing that what we produce is [indiscernible]. If ITM has proven something in the last year, it was that ITM was able to produce really quickly, a lot of stacks as any alluded to, these stacks were then not fit for purpose. We cannot run into the same situation again. So product validation first and then volume, we will be able to do volume. When it comes to new factories and markets also a question which was often asked, building a new factory abroad or even different factories in [indiscernible] also not difficult. It's rather straightforward. One year just be blueprint. But this requires that we do need to have a blueprint at hand, and we will make sure that we will get the current Bessemer Park facility with the plant extension to be a blueprint, which we can then copy into different world regions which is then much easier than trying to fix different factories and layouts different places. Path to profitability, as I said, we do want to become a profitable company. Certainly, we will not be able to do that within 12 months but that is our ambition for the future. But this requires a mature competitive product design, which we will get to, it will require incremental automation, which will improve bid quality and cycle time, rigorous cost management, which I alluded to, building up our aftersales business, important for customers and [indiscernible] and most importantly, volume we can only become profitable this volume. You see it here on the slide, we will get there. I'm confident that we will get there. What does count now is though that we implement with discipline and focus our 12-month priorities to make ITM stronger, more reliable and more capable company. As I said on the first slide or one of the first slides, the large-scale opportunities in the market are yet to come. What we see now is first projects being realized. But as I said, they will go up in scale quite significantly. And by putting these foundations in place, we will be ready on time for that market demand. Thank you very much. This concludes the presentation piece, and I'm happy to take your questions.

Fantastic. Dennis, Andy, thank you very much indeed for the presentation. [Operator Instructions] But just while the team take a few moments to review those questions submitted to ready -- already. I'd like to remind you the recording of the presentation, along with a copy of the slides and the published Q&A can be accessed via our investor dashboard. I'd now like to hand over to James Collins to pose your questions to the ITM Power team. James, can I please ask you just to read out the question where appropriate to do so and direct it to the relevant member of the team.

Okay. Thank you. Okay. I appreciate 2023 focus is U.K. manufacturing. But how many international sites do you envisage for ITM Power by 2025 and 2030, please? And based on current incentives, what would be your preference for either the U.S.A., Germany or Europe?

Can I take that?

I'm all for you here.

Okay. Yes, thank you for the question. As I alluded to on my last slide, I think -- the first priority needs to be that we get our house in order right now, Bessemer Park and that we create a suitable blueprint. Certainly, once we have done that, we do want to expand to different [ quite features ]. I have not yet had the time over 2 months to come up with a strategic plan on how to address which world region. But maybe answering to that initial question, I can tell you that the USA with the recent legislative changes, it's a quite interesting market for us and would be probably very high on this.

Okay. I think you've answered this in parts. Could you please explain why ITM need over 400 staff when very little manufacturing is taking place? Do you said company investors' cash seems to be treated with that in respect and the lack of financial control.

Yes, we don't -- that is why I announced today the headcount reduction program. The current number of employees does not correlate to the short and midterm output within the next ones. And we will in rightsize now also considering our obligations towards customers. But I also have to say that certainly, we hope to be able to scale upwards again, not only product volume but also employees once we solved the current issues of the organization. And once we can really start scaling up manufacturing in a bigger scale.

Okay. Can you explain the difference between cubes and stacks?

Yes. Yes, okay. So I think we do not have a picture at hand, right? But -- so you have to envisage a cube as being a mini container so -- which is like a housing for the stack. So while a plug-and-play container is like a complete electrolysis plant in the container and the stack is what you have normally seen these different plates on top of each other which is then producing hydrogen through the membranes, which is part of the container. And the cube is somewhat in the middle. It's like a mini container version, much smaller than a container hosting part of the balance of the plant. So the stack is like the heart of the electrolyzer. And then from cube to container, you go more and more into the plug-and-play and more scope of the balance of plant direction. I hope that answers the question.

Okay. Dennis, you mentioned automation is one of the key areas where you will focus across the next 12 months and beyond. Given your knowledge of ITM's peers, where do you think ITM currently stands? And what sort of grand would you like to cover first?

On automation?

Yes.

So I think all of -- I would say most of our competitors and then talking [indiscernible] because this is what could be comparable and are looking into automating their securitization. I would say, some are more advanced than others. I think to be honest, I think ITM is not be off at this point in time. But certainly, we have our own ambitions, and we don't want to be average or in the middle at we want to be ahead of the pack. So when you ask about priorities, I said that we do have a road map, which is addressing each and every area of the fabrication process right now, and we will introduce these changes, these priorities around where do we need to improve, in particular, the quality of assembly. So I would say, either adding manual assembly and by that, improving the quality of that bit quality or fully automating certain process steps. And as I also said, to reduce cycle times in particular bottlenecks when it comes to building up the production.

Okay. Should we assume that all revenue deferred from Leuna and Yara now falls into full year 2024? And when do we get full year '24 guidance?

So the -- yes, the short answer is yes. There's a dependency there, which is about the whole plant with the full scoping SAT for us to recognize our revenue. But yes, the Leuna and Yara plants, we are expected to be recognized in FY '24. In terms of guidance, we will next be talking this level detail in the June trading update. And there'll certainly be some guidance for FY '24 there.

Okay. What can be the potential revenues associated with the 2 new RWE Linde orders announced today?

Yes. I think we're moving away from individual projects pricing. It is a commercially sensitive topic, and we're actually keen to make sure that we don't detract from what we're doing in terms of commercial relationships with customers. So whilst we wouldn't say that, it was bid competitively and was one as part of it [indiscernible].

Okay. Today, you announced a 25% reduction in head count, how are you thinking about retaining top talent or hiring new talent and growing companies like ITM require, especially when we look at the new large contracts just signed?

So the 25% held reduction takes into account the word of Lingen projects, and these were online negotiation when we took that decision. And certainly, we consider that. When it comes to retaining talent, this is obviously important for us, and we will make sure not to lose too much talent as part of the process. And I think that's nature I would guess. Would have been worried to be able to scale up the company again in terms of headcount once we scale production. No, I wouldn't. I think we are a very attractive company to our employees and also to applicants. We do see that also in the market. And I think we are in a very good position going forward.

Okay. Can you give an update on Yara delivery, please? Are we going to get a project update generally.

Specific update for the Yara project. Do you want to start that?

Okay. So the Yara projects, we're doing a similar thing to the Leuna projects, we're choosing a split delivery model. So that we can get cubes out supporting customer time frames and stacks will follow. So the bulk of those cubes are in production right now, and we'll be shipping within this financial year, but the revenue will be dropping into next year.

Okay. There's a big demand spike yet to come. Is it a next year event? And what needs to happen for demand to unlock? Are you confident in the seller response from the EU versus the inflation Reduction Act in the U.S?

So as I alluded to on my market side, there are some bottlenecks which are ranging from creating massive infrastructure, having renewable energy production in place and so on and so forth. I think all of these areas are currently being addressed in the different world regions. The U.S.A. is pushing quite strongly ahead right now. But I think the European Union is looking into ways to also speed up the process on the Central European continent. And I have to say that I'm pretty confident with what I see in the momentum is strong, huge. And I would not say these things to be critical roadblocks. I think it's all [indiscernible] bottlenecks, but we need to address them one by one, certainly.

Okay. So planned reduction in testing areas did not materialize recurrent product. When can we expect it to materialize? You indicate costs are compounded by high energy prices. Can you quantify the magnitude of higher energy prices on cost overruns?

So I'll take that. So there's a number of expectations here at the point where we get to volume manufacturing, we are happy with the product, do we need to test every stack 100%. Now we will start to see a validated product going out. So there's a route which is about how many tests we do but there's also a route to shortening test times through various pretesting processes. At the moment because we are somewhat immature as we go through that process. Testing and test [ bay ] activity includes some of the debugging that should also happen upstream. So we will see that improve as we get manufacturing processes in place and improved. So the costs are associated with running 2-megawatt split assembly with 3 stacks in it for a period of time. And we run into various levels. So the intention here is over 20 reduce the levels we run out. So we're really running at 100% for a small amount of time. So I won't put a figure to it right now, but maybe we can answer that as we respond to Q&A.

Maybe adding to that. So I mean, that is absolutely right. It's about trying to reduce the time of testing but also trying to reduce the number of tests we need to perform by improving bid quality and leading to lower failure rates obviously interesting in testing. right?

Very good. I understand the focus on near term and simplifying as opposed to diversifying and make it more complex. But do you exclude using alternative technologies such as alkaline in the longer term?

I'm too much strategist to say that I do exclude any strategic option going forward. But I can tell you that we are confident in the PEM technology we have, and this is our focus product, which we will get, right. And by getting our house in order and doing the homework, which we need to do, we will be a very important market player, if not the most important market player in the payment sphere. What the future brings, will bring the future for sure.

Okay. Can you provide an update on Refhyne II and Gigastack?

So I think on Gigastack provide an update on this part of the slide I had on the products. We have paused development of a new generation stack in order to be able to focus on our state-of-the-art 3MEP 30bar stack. When we talk about Refhyne II, Refhyne II would also be built with the same 10-megawatt standard modules based on the 3MEP 30bar technology as the arriving on project, which we announced. So these are 2 separate topics, right? This project is progressing. We are in very constructive discussions with Linde and Shell ILE, and the project is progressing in the current consumption phase.

Very good. So a question for you, Andy. Can you give more of a breakdown in the inventory increase of GBP 29 million for the period. What is this for?

Sorry, could you say that again, James.

Can you give a more detailed breakdown of the inventory increase of GBP 29 million in the period? What is this for?

So the project cost overruns is the GBP 29 million, inventory is GBP 15 million. So the project cost overruns I mean, as we said in the presentation, this, some of it has to do with design not having been settled as we started to build some of it is to do with change in scope. And exactly when we're going to be delivering to site. And then some of it is also about reworks associated with on-site working subcontracts and packing. Put actual numbers to it. I think the slide probably did enough. We've got a risk-weighted GBP 8.5 million, and the balance is split across all of those categories.

Very good. You stopped signing new contracts last autumn, given that you've now signed the RWE contract, are you in a position to sign further contracts? And have you received any order cancellations in the meantime?

So maybe I'll start answering the second question first. So no, there were no cancellations, and we do not anticipate to receive cancellations. And we are a very constructive collaboration with all our customers to mitigate the project delays and issues we face in the projects. And we are also thankful for that I wanted to say. When it comes to selling, that is indeed true where we decided at a certain point to reduced selling activities and not sign new orders in order to get decreasing time and breathing space required to tackle our issues. As we announced, we have now signed the world's largest PEM electrolyzer in execution which is 2 of them at the same time with a phased delivery approach. I think from here onwards, we will very carefully select which projects we meld into our organization from various viewpoints. One is we need to make sure that we don't overstress the organization, in particular, also looking at what we have in front of us for Refhyne II, and we will also need to look at profitability of projects going forward. I think we are at a point where we have sold enough reference plants, right, where I think we are able to prove deliverability of our product and reliability going forward. And I think we need to strive towards a realistic pricing and caustic scheme. And therefore, we very carefully select new projects to sign.

Okay. A question for you, Andy. Can you give more detail on the revenue recognition timing of the new 100-megawatt Lingen projects? And when do you expect SAT to complete?

So those projects are going to be delivered throughout 2024 and 2025. So revenue, I'll not split out exactly where it is, will be FY '25 and FY '26 with SAT potentially falling into FY '27, depending on exact timing. So we'll update more as that project develops.

Okay. Is the 268 megawatts of latest generation stack mentioned to be in actual project delivery, same as the backlog number that you used to disclose previously. Could you please explain the difference?

Try to do that.

Yes, it's a backlog number. We've historically also included items in negotiation and preferred supplier status. And actually, we think that led to confusion and also in terms of focus, what we focused on, we focus on delivering what we've contracted. So it's absolutely right to talk about the contracted backlog, which is at 268 megawatts.

Right, maybe adding to that, I have to say, coming from the customer side of the industry, it was always a little bit funny to see that so many companies on the electrolyzer where we're putting out MOUs, LOIs, study projects or study phases projects has big announcement. And I think what we need to narrow that down is to real contracts signed and real orders. So when we speak about these 2 Lingen contracts, this is now lead projects, right? This is not just an announcement. And I think the new ITM way of disclosing information will be very much -- it's fine when it's signed and it's really when it's real. And I think we need to step away a little bit from inflating bubble not only as a company, but as a whole industry of that's more than it actually is right. So let's be down to earth realistic about what's going on in the market.

Okay. Given the project costs have been so detrimental to the financial performance, will you be more selective on the projects that you tended for? Are you going to target those that are already funded or where you can deliver product and recognize revenue?

In line with what I just said on the other question, right? So we will definitely select projects carefully. We are partnering with Linde for the sales through our joint venture, ITM electrolysis. So we do have a very strong sales and business development are in place also to screen projects and to check financial viability of customers and also of our funding programs. However, it is very rarely the case that funding can be secured on time. So normally, you have to engage in a pre-phase of the project, call it, feed or whatever it is. But it's still to a certain degree a gamble, which project then gets the funding [indiscernible] out completely that you engage in a project which is not receiving funding. But as a rule of thumb, I think Linde is an organization together with us screening projects. I think we got pretty good at identifying which projects are real and which aren't.

Okay. Would ITM ever look at the licensing model?

For stack technology?

Yes.

No, we wouldn't.

Okay. So where are you on the level of trust that customers have right now for the product? Do you think order intake can materially increase across calendar year '23?

So when it comes to trust, I think what customers are looking for right now and having been a customer myself, is customers want to see running plants right now. They want to see that us and also our competitors in the market actually deliver on the promises we put out, meaning creating reference plants, which show good performance. I think it will be all about delivering reference plants because this will be the most important determinator for trust and increasing trust. And hopefully, by being able soon to deliver on the projects we have under contract, we can be in a position to actually outperform on the trust point because we do have a product and which is working in which we can that it is working.

Okay. Andy, a question for you to cash question. Do we have enough cash to get us to profitability?

So we showed a slide on FY '24 guidance where we start to see cash outflows decreasing, partly with the unwind of working capital, partly with the impact of the 12-month priorities plan, there will continue to be investment for de-bottlenecking and on that new facility. Short answer yes, we have enough cash.

Okay. A question on revenue. How should we think about full year '23, '24 revenue given the significant deferral of full year '22, '23 revenue?

Yes. Our focus absolutely is on the Leuna and Yara projects as flagship pilot projects that shows ITM so if I was looking at revenue now, I would be paying my revenue expectations on those 2 projects, particularly.

Okay. Will ITM continue their partnership with Linde?

As I said in the presentation, the Linde partnership is of very strategic nature and really important for us to scale up our business. And by living up to the promises we made with our project commitments, and also living up to the Lingen challenge ahead of us of delivering 2x 100 megawatts, we will, I think, rebuild some of the confidence and issues, which we sort of be back some of the confidence lost over the last 2 or 3 years. I mean, as I said, I was on the receiving end as well. However, I mean, the relations and tax, we are working very collaborative and closely together. We always like at all the year we had in employees here in our factory and our engineering teams to support us on the way. Me having joined ITM, certainly also a trust-building measure right now in the sense of I think my word does count at Linde being reliable. So I think when I say something, people will also trust me, which is building back confidence to a large degree, I think, which will be important for a strategic relationship. So I mean don't answer to your short question, right? But is the relationship intact, Yes. Is it under stress? Also, yes, because of the project delays we have. And do I think we can get it fixed and regain the confidence? Absolutely and we will strive for that.

Okay. Can you give more details about the new hires of Head of Engineering, please?

The details on the same on?

So the announcement of the new Head of Engineering, can you give us a little bit more background?

So the Head of Engineering, who starts today, is my previous Head of Product Management at Linde Engineering and a very capable person who I know he would exactly fit into the profile we need in order to overcome the issues I mentioned on one of my slides with regards to professionalizing engineering. So it's a trusted professional now for many years and who perfectly fits into their role profile. And having said that, he was also engaged over the last 3 years heavily with all the projects of ITM. Also with the development of the 10-megawatt standard module I mentioned, so it's not that he needs to find his way into the company for 6 months. He knows exactly where ITM stands and can start taking the issues on days 1.

Okay. And on that, the 2-megawatt stack, how deliverable is that for large projects?

It is -- I mean, we just signed a contract or 2 contracts for 2x 100 megawatts, which is definitely a very large project. And we will deliver exactly this stack the 0.7 megawatts stack in assembly of 3. That's why it's called 3 MEP at 30bar as part of these 10 megawatts standard volumes to these large-scale projects. So there is absolutely deliverable.

Okay. Of what sectors are you going to focus on? Will it be ammonia and oil refineries?

I wouldn't say that we focus on a particular sector. I mean our sector is selling plants which produce green hydrogen. And certainly, I will be happy to sell that together with Linde to any customer interest in fact. I wouldn't narrow that down on to certain industries.

So a question on Motive, is ITM moving away from Motive Fuels to create a closer liquid Linde in the future?

No. So these are 2 separate topics, right? So as we announced, Vitol and us are very collaborative and positive discussions about how we see the future of Motive, we had a section on that in our RNS. It's not that ITM tries to access something alone -- to align better today, and that is not the case at all has also nothing to do with Linde. While reviewing the current situation of the business, Vitol and ITM came to the same conclusion that the original intends to build a larger network of fueling stations in the U.K. has limited outlook, and we admit or we see that it would need significant investments if we were to expand to other world regions potentially, for example, Europe. And I think for doing so, ITM would not necessarily be the right partner given that we need to get our house in order and focus our own cash on fixing the fundamentals of our core business. Vitol and us, as I said, we are in good discussions. This is not a tough negotiation at this point in time. And we are investigating all the options, which are at the table from selling the business as a whole to discontinue it in good faith. And we certainly look forward to maintaining a strong relationship with Vitol also after that exercise.

Okay. Where do you see the business in 5 years? Where does ITM sit in comparison with other hydrogen tech companies? That is -- is it in the premier league of such companies such that it could be the forefront of exposing this commercial opportunity?

You will perceive me to be very careful on giving commitments to future, especially when it comes to numbers. But certainly, I wouldn't sit here today and I wouldn't have joined ITM. I didn't think that the ITM can become one of the front runner in the industry.

Okay. So a question here from Anthony. Has the screen printing technology being robustly verified?

So the technology itself is verified and as a stand-alone technology, obviously, and as I said, we expect to deploy it in October, which means that we will get it well ahead of time and that we will make sure that we verify and test the screen printing prior to actual deployment into the factory then and replacing the current machines we have in the current way of doing it. So no, we haven't received the machine, right? But once it's being received, we will certainly do proper meditation as we do for all incremental automation steps are coming.

Okay. The high cost of electricity appears to put it across the disadvantage compared with the cost of blue hydrogen. So do you see an opportunity to reduce the electricity costs by using the energy of Waste team?

This is a little bit mixing up 2 questions on statement. So I would necessarily say that high energy price is favoring blue hydrogen because you also need energy for capturing CO2 and sequestrating under the electrolysis, it's not as easy as that, as you say, just greened electricity and blue doesn't, I think to electrolysis and what was the second part of the question? Could you read that again, please?

It's about using waste team.

Our waste team. So when it comes to hot steam, I mean, there's a certain electrolyzer technology, which is aiming for utilizing hot off steam which is the SOFC solid oxide technology. This technology does perform well, in particular, when you have hot off steam. PEM and Alkaline are considered coal electrolysis.

Okay. Can we have an update on the Snam relationship?

So the relationship. Do you want to take -- so the relationship with Snam is intact. We -- it's a strategic nature for ITM. And we -- I mean, the question is very broad, right? So I mean it's an intact relationship, we hope that we will receive one or the other order from Snam we'll be happy to support their agenda on the hydrogen,certainly. I don't know if you want to add, Andy.

No. I think that's fine.

Okay. Do you have an update on the Glasgow Whitelee project, the 10 megawatts?

So we are working on it. I wouldn't be in a position to disclose details about where we stand in the discussion negotiation. And certainly, that's a sensitive topic also for our customer. So I normally do not comment on sales projects in particular, but it's still an ongoing effort.

Okay. And are you continuing to work with universities around the U.K.

You want to take that?

We're doing -- we're doing some work with universities around the U.K., but actually, there's also an incredible in-house capability in terms of developing the technology that we have. So yes, there is some work, but also there's a lot of work being done by ITM.

Okay. Sorry, another question for you, Andy. Can you give us the firm orders, please, excluding Leuna and Yara and RWE?

So I'm not sure I understand the question, James.

So it's a question from Chris. So can you give us the firm orders, please, excluding the Leuna and Yara and RWE orders? I think he has a calculated 22 megawatts outside of those orders.

That sounds correct, yes. That's exactly right.

Okay. Sorry, one question from Skye. What was the difference in the GEP30 Stack Skid produced versus the MEP?

The GEP, the Gigastack would have been stack run of 2.5 megawatts per stack, and the MEP is 0.7 megawatts stack. And we would -- we do bundle 3 of these stacks for 3MEP module, which is then 2 megawatts, worth of capacity. And the Gigastack would have been 2 Gigastacks bundled to 5 megawatts.

Okay. And just a question...

The technology, sort of from a technology viewpoint? The stacks would have been similar. So when it comes to membranes and electrochemistry, similar technology performance.

Okay. There are a number of private investors that were far from happy with the previous year's reasons for production delays and numerous excuses as to the drain on cash. Does the new CEO recognize that he has to be more transparent and actually give honest opinions on whether ITM will, in fact, be in a position to supply electrolyzers to existing customers in the near future.

I would just say, yes. All right. No, I mean, let's be honest, right? I mean I do see that as well. And the reason why we have -- I hope that you perceive that as a step change in transparency today. And this was also important for us. We will continue exactly in that way to provide you the transparency of the actual situation of the business and of how we see the market going forward because there's nothing to hide, frankly. Let's just be open where we stand and let's improve the business from here on and sketch a successful story about ITM, we will be able to do so. So yes, I absolutely recognize the need for transparency for our shareholders.

Okay. Will the new Head of Engineering be responsible production and manufacturing?

No. We -- this is a different topic, right? So from an organizational viewpoint, we have an engineering organization, which -- so this is technology, the actual engineering, which we call product management and the validation piece around engineering. And then we have a separate manufacturing and procurement organization. Which is a normal way of how we would organize such kind of business.

Okay. I think we're coming towards the end -- sorry, some more questions coming in. Just one likely just one for you, Andy, again. I think you covered it, but likely revenue recognition timing associated with the 200-megawatt orders. Dennis mentioned a phasing, but no timings.

Yes. So deployment calendar year 2024, 2025, financial years ending April 25, April 26, with the potential for some to go into 27, but we'll update more as the project develops.

Okay. And a question from Roger. Generally speaking, do you anticipate that your plans in the near term will be held back by the difficulty in recruiting?

No, I don't expect that. Right now, it's about, as I said, rightsizing. It's not so much about new recruitment efforts. Certainly, we will have to bring in new capabilities in some critical areas of the company. But it's not that there are not people who want to join capable people want to join every 100 companies nowadays. It's a very attractive business for you to be.

Okay. And do you foresee problems resistance to change in the culture of the business. And if so, how will you address them?

I mean you can never rule it out completely, right? And certainly, a certain percentage of the organization will have issues. But overall, I have to say what I have seen over the last 2 months was really promising. We have a hugely dedicated and motivated workforce. I think what we need as a company now is to stay into the right direction and especially setting priorities and narrowing focus. It's not that people at ITM and it didn't want to deliver what was sold was just the sheer amount of topics to work on in parallel with limited priorities being set. And I think we will definitely change that and hopefully that will over also the employees to embark on their journey to [indiscernible] with us.

And perhaps if I could offer on top of that, we're already seeing a change in the last 2 months, having been before and post Dennis' arrival.

Excellent. Okay. I think we're probably running out of time on that front.

That's great, James. Thank you, and thank you indeed for the questions. Of course, company review all the questions submitted and we published responses on the Investor Meet company platform where appropriate to do so. Dennis, just before redirecting the investors to provide you with their feedback, which is particularly important to you and the team. I just ask just for a few closing comments, please.

Yes. Thank you. I think all was said what we wanted to say, we did say. So this leaves me with maybe reinforcing again that we perceive this today to a certain degree of reset of the way we work with shareholders, and we work with the market in terms of transparency and openness also being realistic. About what we do, and certainly, we will keep you updated on the progress of delivering against our 12 months priorities plan. Thank you very much for taking the time dialing in today, and thank you for your very constructive questions. We have a lot to do, not in front of us, but we will get it done, and we will be ready on time for the big months like to be seen in the market. Thank you very much for your attention.

That's fantastic. Dennis, Andy, thank you indeed for updating investors today. Please ask investors not to close the session should be automatically redirected to provide your feedback and order the team can better understand your views and expectations. This will only take a few moments to complete and it's greatly valued by the company. On behalf of the management team of ITM Power Plc, I would like to thank you for attending today's presentation. That concludes today's session. Thank you, and good morning to you all.