Operational Update

RNS Number : 0544X

Clean Power Hydrogen

24 August 2022

 

The information communicated within this announcement is deemed to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 which is part of UK law by virtue of the European Union (withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 24 August 2022

Clean Power Hydrogen Plc

("CPH2", the "Company" or the "Group")

Operational Update

CPH2, the UK-based green hydrogen technology and manufacturing company that has developed the IP-protected Membrane-Free Electrolyser ("MFE"), provides an operational update on the commissioning process and delivery of its initial MFE220 units. As previously announced, CPH2's early-stage commissioning highlighted certain engineering and scale up issues, which led to delays in the delivery of these units whilst design modifications were completed and implemented. The impact of these changes has been further exacerbated by delays in the global supply chain in physical goods, as many other businesses have experienced in the current economic climate.

CPH2 is continuing to work to remedy these issues and to finalise the revised design and engineering processes. While the Company still expects to deliver the first two contracted units to its customers before the end of the year, the performance of these units will be subject to further optimisation as the revised design and engineering processes are finalised. Accordingly, sales income from these units will now be realised in 2023 alongside the other contracted units.

CPH2 recognises the importance of delivering its first MFE220 units as working 'in the field' and is deploying significant time and resources to achieve this. Whilst the Group's revenues in FY2022 will be lower than originally expected as a result of these delays, the impact of this reduction is more than off-set at a cash level by the recently signed GHFG Ltd licensing deal, with the Company's cash position expected to be ahead of forecast, helped by tight budgetary control, reduced operating expenses and license royalty income.

The Company is encouraged by the strong pipeline of incoming demand for it's products, both via direct sale and licensing deals, with additional contracts and orders expected to be finalised once the first MFE220 unit has completed it's Factory Acceptance Testing ("FAT") and is in operation at the customer's site. The Group's immediate focus is on delivering these first units and finalising a revised design and engineering pathway to address all scale-up issues identified and to optimise the performance of the MFE220 units.

The Company is in the final stages of agreeing the contractual arrangements, that were highlighted in its admission document, with KCA Deutag and expects to make an announcement shortly.

Jon Duffy, Chief Executive Officer of CPH2, commented:

"While the engineering and scale up issues brought about delays in the commissioning of the MFE220 units have been frustrating, we are confident that we will still deliver these units to our customers in an acceptable time frame, allowing testing and commissioning on site by the end of the year. Financially we will realise the income from these units in 2023, however we remain well funded and confident on increasing income further as we deliver working units to our customers."

For more information, please contact:

Clean Power Hydrogen Plc	via Camarco
Jon Duffy, Chief Executive Officer
Cenkos Securities plc - NOMAD & Broker
Neil McDonald	[phone]
Peter Lynch	[phone]
Adam Rae	[phone]
Camarco PR	+ 44(0) 20 3 757 4980
Billy Clegg
Owen Roberts
Lily Pettifar

To find out more, please visit: https://www.cph2.com

Overview of CPH2

CPH2 is the holding company of Clean Power Hydrogen Group Limited ("CleanPower") which has almost a decade of dedicated research and product development experience. This experience has resulted in the creation of simple, safe and sustainable technology which is designed to deliver a modular solution to the hydrogen production market in a cost-effective, scalable, reliable and long-lasting manner. The Group's strategic objective is to deliver the lowest LCOH in the market in relation to the production of green hydrogen. The Group's MFE technology is already commercially available and demonstrating cost efficiencies and technological advantages. CPH2 is listed on the AIM market and trades under the ticker LON:CPH2.

 

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