Interim Results

ITM Power PLC
31 January 2008


Immediate Release                                                31 January 2008



                                 ITM Power plc

                            ('ITM' or 'the Company')

                                Interim Results

                    for the six months ended 31 October 2007

ITM Power Plc (AIM:ITM) is a clean energy company focused on developing
technology to alleviate the present dependence on hydrocarbon fuels. Today it
announces its Interim Results for the six months ended 31 October 2007.

Highlights

   • Completion of phase one of the new 15,000sq ft production facility in
    Sheffield on time and within budget


   • Important agreements signed for medium term applications of ITM
    technology:


   • Co-operative Research and Development Agreement (CRADA) with United
    States Naval Undersea Warfare Center Division Newport


   • Agreement with Boeing to design an Unmanned Aerial Vehicle refueling
    system


   • Key US patent granted for ITM's unique crosslinked hydrophilic ionic
    materials


   • Completion of development of Hydrogen Petrol Bi-fuel car


   • Successful development of a low cost ($250/kW) fuel cell stack
    technology


   • Successful design and construction of a 100 watt hydrogen oxygen fuel
    cell stack


   • New commercial initiatives:


   • Program to develop 1kW fuel cell for commercial production in late 2009


   •Design of a 5kW electrolyser to interface with wind or photovoltaic power
    generation devices


   •Design of a low pressure 10kW electrolyser for use in low carbon domestic
    housing projects


   •Design of a 1-3kW electrolyser for on site hydrogen generation for
    laboratories and other low demand customers


   • Pre tax loss for the period increased from £1.42 million to £1.91
    million in line with budget and reflects the increased level of development
    activity which has taken place in 2007


   • Cash at bank and in hand as at 31 October 2007 - £29.68 million


Peter Hargreaves, Chairman of ITM commented:

'I feel fortunate to have assumed the Chair at ITM at such a strategic juncture
in the Company's existence. All the technology we have been developing is not
only coming to fruition but also gaining international recognition. When the
world adopts hydrogen as one of the fuels of the future our electrolyser units
and the technology within will be much sought after. Elsewhere our superior fuel
cell construction methods are also being sought as far afield as Boeing in
Madrid and the United States Naval Undersea Warfare Center Division Newport. Our
labs, which are working in close conjunction with our new production facility,
should enhance the Company's reputation.'

For further information please contact:

ITM Power plc                                                    01799 542 222
Jim Heathcote, Chief Executive Officer

Panmure Gordon & Co.                                             020 7459 3600
Katherine Roe

Buchanan Communications                                          020 7466 5000
Ben Willey
Richard Darby
Ben Romney

Chairman's statement

I am pleased to report the interim results for the six months ended 31 October
2007 and update shareholders on new developments.

The Company is in transition from a research company into a low volume
manufacturer of high technology products. This is a challenging phase in the
life of the Company. Numerous strands of novel technology have been developed
internally, which must be combined with externally sourced components and
subsequently integrated into complete systems. ITM has made significant progress
in developing the systems and the required ancillary equipment for the
construction of a 10kW electrolyser home refueller system. We are well advanced
in the process of proving our home refueller electrolyser but we wish to perfect
the advanced injection moulding method to ensure its robust construction.

Since July all the technical milestones set out at that time have been achieved.
The Company has completed the initial stages for the new facility in Sheffield
and this will produce prototypes and small scale production to take ITM's
products to market later this year.

Given the macro economic background of persistently high energy prices and the
threat of global warming, the requirement of this technology is more urgently
needed than ever. We await for the world to embrace hydrogen as a real answer to
the need for pollution free energy.

Financials

During the six months under review, pre-tax losses increased to £1.91 million
(31 October 2006: £1.42 million), reflecting the planned increase in both
development activity on future products and on the new 15,000sq ft production
facility in Sheffield. The Company continues to build its scientific and
technical teams alongside the new team at the production site. Staff costs
continue to account for about half of the Company's cost base. The Company's
investment in the production facility was carried out on time and within budget.
It is anticipated that the full cost of fitting out the production should be
concluded during the current financial year.

During the period, the Company benefited from increased interest rates on its UK
Sterling Cash Deposits producing £902,000 in interest receivable, compared with
£752,000 for the same period last year. At the period end the Company held cash
and cash equivalents of £29.68 million (31 October 2006: £32.66 million). The
directors consider this adequate to achieve ITM's commercial objectives.

The Company presents these interim accounts under International Financial Reporting 
Standards (IFRS) having adopted these standards on 1 May 2007. Management has performed 
an assessment of the impact of IFRS and has not identified any material differences 
resulting from the transition to IFRS other than certain presentational changes which do not 
impact the Company's previously reported results. The Company has therefore not provided 
a reconciliation of UK GAAP to IFRS financial information. Details of the Company's 
significant accounting policies can be found on the company's website (www.itm-power.com/investors.html)

The Board is not recommending payment of a dividend in accordance with the
dividend policy stated at the time of the IPO.

Commercial developments

The initial phase of the new 15,000sq ft production facility in Sheffield was
completed on time and within budget. As well as installing the production
equipment we have recruited new staff to operate the facility, as mentioned
above. We expect several months of trial production and, as reported a year ago,
we expect it to be operational during the first quarter of 2008 with first
production units available for demonstration and testing with customers early in
the third quarter of 2008. We believe the facility has scope for future capacity
expansion.

Since the period end, we have signed agreements with significant organisations:

• In November 2007, ITM signed an agreement with Boeing to design an
  environmentally friendly Unmanned Aerial Vehicle refueling system.

• In December 2007, ITM signed a Co-operative Research and Development Agreement 
with the United States Naval Undersea Warfare Center Division Newport to collaborate 
in the development of advanced power systems for unmanned undersea vehicles (UUV) applications.

Technical developments

FUEL CELL DEVELOPMENTS

A 100 watt demonstration fuel cell stack

ITM has successfully developed a fuel cell stack design which it believes is
suited for high power density operation in commercial devices and this design
has been used to construct a 100W stack. In addition, the Company has sought to
reduce the cost of the entire system by designing a passive hydration management
system based upon its low cost hydrophilic materials. The resulting fuel cell
employs the '$500/kW' membrane catalyst technology announced in June 2007 and
has operated repeatedly at powers above 100W in a number of stack configurations
(including a 5 cell, high current and a 10 cell, high voltage array).

The development of a Hydrogen-Oxygen fuel cell stack with an estimated
production cost of less than $250/kW

The Company is pleased that it has succeeded in meeting the fuel cell stack cost
reduction target of less than $250/kW if produced in accordance with the
assumptions set out previously on the 18 October 2006. The reduction in cost has
been achieved both by increasing the power density per unit area of the cell and
reducing the loading of the platinum catalyst. The Company has successfully
operated cells using the lowest catalyst loading currently available in the
commercial market.

ELECTROLYSER DEVELOPMENTS

A 25kW stack has been constructed using ITM's nickel (hydrogen) catalyst and low
density platinum (oxygen) catalyst, which allows it to meet the projected
production cost (for the stack) of less than $200/kW. It has operated
successfully at low pressure when tested using inputs in excess of 25kW and a
transient (i.e. 30 minute on-off) load cycle. The unit proved well able to
handle the large gas volumes associated with low pressure operation without
excessive heating or hydraulic problems.

The use of a low platinum loading catalyst has allowed the Company to meet its
cost target. However, one of ITM's preferred non-platinum oxygen catalyst
systems has now achieved longevity in excess of 10,000 hours and thus a
non-platinum system is available for use to interface with commercial scale
renewable energy systems (photovoltaic or wind powered) and commercial
transportation, if required.

THE 'ONE-STEP' PRODUCTION PROCESS

The basic concept of a 'one-step' method of manufacture in which the ionic
membrane is polymerised in-situ within the catalyst electrode structure to form
the Membrane Electrode Assembly (MEA) or cell, is a basic part of ITM's primary
patent portfolio which has now been granted widely around the world.

Development in this area has progressed steadily with the initial objective of
supporting the engineering of the prototype Home Refueller Unit. ITM is pleased
to announce that MEAs made by a one-step process can now be produced in
pre-production batches with excellent reproducibility and performance. These
MEAs have been extensively tested in electrolyser cells as incorporated into the
25kW electrolyser stack referred to above. On this basis the 'one-step' process
is now considered by the Company to be suitable for the electrolyser production
team to utilise as appropriate.

New Developments as of 31 January 2008

ITM is now examining additional potential product lines that can supplement the
10kW home refueling system. The initial objective is to widen the potential
applications that can create revenues from the already developed technology in
order to maximize the return on our substantial investment. The Company will be
examining the development of three further electrolyser systems.

The first programme would add a 5kW electrolyser system to the product family.
This could be used in conjunction with a small wind machine or solar
(photovoltaic) panels to create a reliable grid independent back-up power
system, or to make on site hydrogen for mobile phone mast fuel cell back-up
power systems.

In addition ITM will be considering the development of a lower pressure, lower
cost 10kW system that could be used in low carbon housing projects to supply
hydrogen to a gas boiler, cooker and a small fuel cell.

The third route to providing an additional commercial product involves the
design of a much smaller system in the one to three kilowatt range for on site
hydrogen generation at laboratories and other low demand hydrogen customers. In
addition it is intended that this device will also provide a 'test bed' for the
application of a further extension of the ITM 'one-step' cell manufacturing
process.

Finally, building upon the successful research in fuel cells, reported in the
past year, we are now setting out a major new programme to develop a 1kW fuel
cell system for demonstration in mid 2009 with the objective of sale and
production in the second half of next year. The fuel cell will be designed to
integrate as a pair with one of ITM's electrolysers. The Company intends to use
both the hydrogen and oxygen from the electrolyser to create a complete energy
storage system with the minimum balance of plant.

The programme will require the development of a new gas storage system for both
hydrogen and oxygen. The Company has already filed patent applications on a new
design concept. In addition the programme will require the development of a
hydration system, gas control system and the electronics required to control the
fuel cell system.

Board and staff

To enable further acceleration of ITM's development activity, the Company has
recruited a further 18 staff to the sales, production and engineering teams
since last financial year end. We welcome the new recruits to ITM and thank all
of our staff for their hard work and commitment during the last six months,
especially those who were involved with the completion of the milestones.

Outlook

ITM's continuing objectives over the next year are to further expand our
commercial relationships and supply initial demonstration and test units for
evaluation to partners with the objective of substantial commercial sales.

Subject to completion of these successful field trials, we anticipate entering
negotiations and plan rapid commercialisation using the new Sheffield facilities
to manufacture initial commercial units.

ITM has made excellent progress and is now entering the commercial phase of its
development. I feel privileged to be assuming the position of Chairman at such a
pivotal time for the Company.

Peter Hargreaves
Chairman
31 January 2008


CONSOLIDATED
INCOME
STATEMENT
(UNAUDITED)
Results for the
six months
ended 31
October 2007
                        Six months               Six months    Year ended 30
                        ended 31                   ended 31    April 2007
                        October 2007           October 2006    (audited)
                        (unaudited)           (unaudited)
                        £'000                       £'000      £'000

Operating costs
- Research and
development                   (2,028)              (1,547)              (3,428)
- Production                     (84)                   -                    -
- Sales and
marketing                        (70)                 (23)                 (35)
-
Administration                  (625)                (624)              (1,193)
                             ---------            ---------            ---------
Loss from
operations                    (2,807)              (2,194)              (4,656)

Interest
receivable                       902                  752                1,584
Grant income                       -                   18                  330
Interest
payable                           (1)                   -                    -
                             ---------            ---------            ---------
Loss before
tax                           (1,906)              (1,424)              (2,742)
Tax                                -                    -                    -
                             ---------            ---------            ---------
Loss after tax                (1,906)              (1,424)              (2,742)
                             =========            =========            =========
Loss per share
Basic and
diluted                         (1.9p)               (1.4p)               (2.7p)
                             =========            =========            =========
                         102,060,092          101,009,661          101,060,568
                             =========            =========            =========

The loss per ordinary share and diluted loss per share are equal because share
options are only included in the calculation of diluted earnings per share if
their issue would decrease the net profit per share or increase the net loss per
share.

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (UNAUDITED)
Results for the six months ended 31 October 2007

         Called up share Share premium Merger reserve  Retained loss   Equity
               capital       account
                 £'000         £'000           £'000   £'000           shareholders'
                                                                       funds
                                                                       £'000

At 1 May         5,098        36,271          (1,973)         (6,861)       32,535
2007
Issue of
shares               7             1               -               -             8
Share
option               -             -               -              13            13
charges
Retained
loss                 -             -               -          (1,906)       (1,906)
for the         --------       -------        --------         -------    ----------
period
At 31
October          5,105        36,272          (1,973)         (8,754)       30,650
2007            ========       =======        ========         =======    ==========


CONSOLIDATED BALANCE SHEET (UNAUDITED)
As at 31 October 2007

                        As at 31         As at 31           As at 30 April
                        October 2007     October 2006       2007 (audited)
                                         (unaudited)
                        (unaudited)      £'000              £'000
                        £'000
NON CURRENT ASSETS
Property,
plant and
equipment                        1,451                821                  990
                              ----------          ---------             --------
CURRENT ASSETS
Trade and
other
receivables                        381                413                  189
Cash and cash
equivalents                     29,682             32,664               31,833
                              ----------          ---------             --------
TOTAL CURRENT
ASSETS                          30,063             33,077               32,022
CURRENT LIABILITIES
Trade and
other payables                    (864)              (241)                (477)
                              ----------          ---------             --------
NET CURRENT
ASSETS                          29,199             32,836               31,545
                              ----------          ---------             --------
NET ASSETS                      30,650             33,657               32,535
                              ==========          =========             ========

EQUITY
Called up
share capital                    5,105              5,058                5,098
Share premium
account                         36,272             36,130               36,271
Merger reserve                  (1,973)            (1,973)              (1,973)
Retained loss                   (8,754)            (5,558)              (6,861)
                              ----------          ---------             --------
EQUITY
SHAREHOLDERS'
FUNDS                           30,650             33,657               32,535
                              ==========          =========             ========



CONSOLIDATED CASH FLOW STATEMENT (UNAUDITED)
Results for the six months ended 31 October 2007

                               Six months         Six months         Year ended 30
                                 ended 31          ended 31          April 2007
                             October 2007          October           (audited)
                            (unaudited)            2006
                                                  (unaudited)
                                  
                                  £'000            £'000               £'000
                                               
                                                     

Net cash from
operating
activities                       (2,402)            (1,720)            (3,705)
                                ---------          ---------           --------
Investing activities
Interest
received                            902                577              1,584
Interest paid                        (1)                 -                  -
Purchases of
property,
plant and
equipment                          (658)              (141)              (487)
                                ---------          ---------           --------
Net cash used
in investing
activities                          243                436              1,097
                                ---------          ---------           --------
Financing activities
Issue of
ordinary share
capital                               8             28,486             28,667
Grant income
received                              -                 18                330
                                ---------          ---------           --------
Net cash used
in financing
activities                            8             28,504             28,997
                                ---------          ---------           --------
                                ---------          ---------           --------
(Decrease)
Increase in
cash and cash
equivalents                      (2,151)            27,220             26,389
Cash and cash
equivalents at
the beginning
of the period                    31,833              5,444              5,444
                                ---------          ---------           --------
Cash and cash
equivalents at
the end of the
period                           29,682             32,664             31,833
                                =========          =========           ========

1. Basis of preparation of interim figures

The interim financial statements have been prepared using accounting policies
consistent with International Financial Reporting Standards (IFRSs) as adopted
for use in the EU. While the financial information included in this interim
announcement has been compiled in accordance with the recognition and
measurement principles of IFRSs, this announcement does not itself contain
sufficient information to comply with IFRSs. This interim financial information
does not constitute statutory financial statements within the meaning of section
240 of the Companies Act 1985.

The financial information for the six months ended 31 October 2007 and 31 October 
2006 has not been audited.  The information relating to the year ended 30 April 2007
is an extract from the audited financial statements for that year on which the auditors 
gave an unqualified audit report and did not contain a statement under s237 (2) or (3) of the 
Companies Act 1985.  A copy of those financial statements has been filed with the Registrar of Companies.

The Company previously prepared its financial statements under UK Generally Accepted 
Accounting Principles ('UK GAAP') until 30 April 2007. From 1 May 2007, in line with 
AIM listing requirements, the Company will prepare its consolidated financial statements 
in accordance with IFRS.

These interim results are the first results to be prepared under IFRS and include 
IFRS comparative financial information for the six months to 31 October 2006 and 
for the year ended 30 April 2007. In July 2008, the Company will present its first 
annual report and accounts under IFRS for the year ended 30 April 2008.

Management has performed an assessment of the impact of IFRS and has not identified 
any material differences resulting from the transition to IFRS other than certain 
presentational changes which do not impact the Company's previously reported losses 
or net assets. The Company has therefore not provided a reconciliation of UK GAAP to 
IFRS financial information.

2. Significant accounting policies
The financial information presented for the six months ended 31 October 2006 and
for the year ended 30 April 2007 has been restated to comply with IFRS.

The financial statements have been prepared on the historical cost basis.

The principal accounting policies adopted by the Company are available from the
website at www.itm-power.com


INDEPENDENT REVIEW REPORT TO ITM POWER PLC

Introduction
We have been engaged by the Company to review the interim set of financial
statements for the six months ended 31 October 2007 which comprises the
consolidated income statement, the consolidated statement of changes in equity,
the consolidated balance sheet, the consolidated cash flow statement and related
notes 1 and 2. We have read the other information contained in the interim
report and considered whether it contains any apparent misstatements or material
inconsistencies with the financial information.

This report is made solely to the Company, in accordance with International
Standard on Review Engagements 2410 issued by the Auditing Practices Board. Our
work has been undertaken so that we might state to the Company those matters we
are required to state to them in an independent review report and for no other
purpose. To the fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company, for our review work, for this
report, or for the conclusions we have formed.

Directors' responsibilities

The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by, the directors. The directors
are also responsible for preparing the interim report in accordance with the AIM
Rules of the London Stock Exchange.

As disclosed in note 1, the annual financial statements of the Company will be
prepared in accordance with IFRSs as adopted by the EU. The interim financial
statements included in this interim report have been prepared in accordance with
the accounting policies the Company intends to use in preparing its next annual
report.

Our responsibility

Our responsibility is to express to the Company a conclusion on the interim
financial statements in the interim report based on our review.

Review work performed

We conducted our review in accordance with International Standard on Review
Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information
Performed by the Independent Auditor of the Entity', issued by the Auditing
Practices Board for use in the United Kingdom. A review of interim financial
information consists of making enquiries, primarily of persons responsible for
financial and accounting matters, and applying analytical and other review
procedures. A review is substantially less in scope than an audit performed in
accordance with International Standards on Auditing (UK and Ireland) and
consequently does not enable us to obtain assurance that we would become aware
of all significant matters that might be identified in an audit. Accordingly, we
do not express an audit opinion.

Conclusion

Based on our review, nothing has come to our attention that causes us to believe
that the accompanying interim financial information is not prepared, in all
material respects, in accordance with the AIM Rules of the London Stock
Exchange.





Deloitte & Touche LLP
Chartered Accountants and Registered Auditor
Cambridge, United Kingdom




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