IdaTech Trading Update and New Contract Win

IdaTech plc (AIM IDA.L), a global leader in the development and manufacture of clean and reliable PEM fuel cell products for critical backup power markets, today provides a trading update for 2009. The Company will announce its preliminary results for the year ended 31 December 2009 at the end of March 2010.

Trading Update

IdaTech has delivered fuel cell system sales volumes ahead of market expectations, despite the extraordinarily difficult year for businesses globally, increasing the number of units sold by over 5 times the 2008 volume. Overall 445 systems were sold during 2009.

Revenue for the year was $6.6 million (2008 $5.9 million) an increase of circa 12% on 2008 with revenue from product sales almost doubling to $4.5 million from $2.4 million. The sales mix in the year compared with 2008 was more heavily skewed towards direct hydrogen systems which have lower selling prices than reformed systems. This was a result of two factors; the economic downturn resulting in IdaTech’s customers utilising certain Government subsidies which currently favour such direct hydrogen fuelled systems and the sale of 300 ElectraGenTMH2-I systems in India to ACME TelePower the Indian telecommunications supplier. The loss before tax on ordinary activities from continuing operations and the cash burn will also be better than market expectations.

During 2009, IdaTech focused its development resources on the next generation methanol/water fueled system and the natural gas fueled system. Once completed, both systems will demonstrate step changes in performance and in cost reduction, thereby positioning IdaTech to address a significantly increased portion of the critical power backup markets worldwide. As a result of this focus, IdaTech will devote its development effort to the 1-5kW power output product range. A non-cash, impairment charge, of $2.7 million (after tax) in the carrying value of the intangible assets will be recorded reflecting the shift away from the commercial development of the smaller 250 Watt product line. The valuation of the core technology of the business remains intact.

The Company also successfully renegotiated its Supply Contract with ACME TelePower to secure more favorable pricing and product launch timing. ACME TelePower remains a strong partner in the Indian Telecommunications market.

Additionally, the Company completed two development contracts. The most significant related to the advanced development of its proprietary metal membrane hydrogen purification technology, Hypurium™ for large scale industrial applications.

Contract Win

At the end of 2009, the Company received an order for 108 systems for delivery and deployment in the first quarter of 2010. This already positions IdaTech for 2010 with a backlog of nearly one quarter of the 2010 full year market expectations.

Further details of the performance of the business during 2009, the Company’s strategy for achieving sustainable growth and profitability and the outlook for 2010 will be provided in the preliminary results. 

Source: IdaTech