Fusion Fuel Green PLC — FY2022 Form 20-F
Reporting period: Fiscal year ended December 31, 2022, with FY2021 comparisons. Although the request identifies 2022 Q4, this is an annual report; it does not provide standalone fourth-quarter results. Financial statements are prepared under IFRS and presented in euros.
Business context
Fusion Fuel is an early-stage green-hydrogen technology and project-development company. It sells or plans to sell HEVO electrolyzer technology and develop hydrogen plants to sell hydrogen. The company reported no revenue in FY2022 or FY2021. Its first integrated demonstration plant, H2Evora, was commissioned in 2022; commercial-scale operations and technology sales remained dependent on project execution, funding and customer agreements.
Key financial metrics
| Metric | FY2022 | FY2021 |
|---|---|---|
| Revenue | €0 | €0 |
| Cost of sales / gross loss | €8.77m / (€8.77m) | €0 |
| Operating expenses | €26.15m | €7.69m |
| Operating loss | (€34.75m) | (€6.85m) |
| Net finance income, including warrant fair-value movement | €8.06m | €31.04m |
| Net result | Loss of €27.35m | Profit of €23.56m |
| Cash used in operating activities | €29.85m | €14.66m |
| Cash and cash equivalents, including restricted cash | €8.16m | €7.68m |
| Total assets / total liabilities | €65.37m / €36.01m | €69.25m / €19.74m |
At year-end, €2.93m of cash was restricted for specified projects, leaving €5.24m of unrestricted cash. The company reported no external debt; lease liabilities were €8.32m. Current assets were €38.74m and current liabilities €25.44m, but cash availability is constrained by restricted funds and substantial operating needs. No cash dividends are planned.
Material changes versus FY2021
- Operating loss widened to €34.75m from €6.85m, while the company moved from FY2021 profit to a FY2022 loss. The prior-year profit included €28.35m in non-cash warrant fair-value gains; FY2022 warrant gains were €7.62m.
- Administration expenses rose to €18.42m from €7.51m, and research and development expense rose to €0.91m from €0.18m in the income statement. The filing separately reports total R&D costs of €2.83m and €0.93m, respectively, reflecting a broader cost presentation.
- FY2022 cost of sales included €8.40m of onerous-contract provisions (€5.17m for Exolum and €3.2m for two other projects) and €0.36m of inventory write-offs. The Exolum project is expected to generate a €5.17m loss before any potential grant support.
- Inventory increased to €22.34m from €3.69m, including €16.55m of work in progress. Operating cash outflow more than doubled.
- The company recorded a €3.32m impairment charge on property, plant and equipment and recognized €3.51m of share-based payment expense, versus a €0.84m credit in FY2021.
Liquidity, outlook and risks
- Going concern: KPMG issued an unqualified opinion but highlighted substantial doubt about the company’s ability to continue as a going concern, citing recurring losses, negative operating cash flows and dependence on additional funding. Management believes available resources, expected grant receipts, project inflows and financing options will fund operations for at least one year after issuance; this depends on uncertain future funding and execution.
- Funding needs: Management expects to seek additional debt, equity or strategic funding. At December 31, 2022, capital commitments for Benavente production lines were €12.4m, of which €6.4m was due in 2023; the company also disclosed about €7.9m of committed 2023 contract spend. It had sold 681,926 shares through its ATM program in 2022 for net proceeds of about $3.69m.
- Grants: The company reported €64.1m in grant awards, of which €6.0m had been received by the financial-statement date; €5.4m had been submitted for payment, with timing uncertain. Certain grant proceeds are restricted to project spending. Subsequent to year-end, the company reported VAT receipts, grant receipts and further ATM proceeds, but these do not remove the underlying funding uncertainty.
- Asset sale and leaseback: The Benavente factory sale generated nearly €7.5m in net proceeds after holdbacks and deposits. The company leased the facility back for an initial 20 years at €50,000 monthly rent, subject to annual indexation.
- Commercial outlook: Management described a project pipeline of about 1.5 GW, but most announced projects were not binding commitments. Apart from Exolum and CSIC, the company said it was generally not obligated to proceed with listed projects. Technology sales and hydrogen revenues were expected to begin in 2023; HEVO-Chain was undergoing testing, with initial commercial use expected in 2024. These are forward-looking expectations, not assured results.
- Key execution risks: Long sales and permitting cycles, customer concentration, unproven commercial scale, manufacturing ramp-up, dependence on suppliers and related-party manufacturer MagP, project delays and cost overruns, uncertain grant timing, hydrogen-market adoption, and need for additional capital.
- Controls and reporting: Management concluded disclosure controls and internal control over financial reporting were ineffective at year-end due to material weaknesses in control processes, segregation of duties and IT general controls. No resulting financial-statement misstatements were identified; remediation remained in progress.
Investor facts to verify
- Available unrestricted cash, operating cash burn and financing runway, including whether subsequent grant and ATM proceeds were received and remain available.
- Timing and conditions for collection of awarded grants, and the portion restricted to project expenditures.
- Actual project economics and remaining exposure on the €8.40m onerous-contract provisions, especially Exolum and the two other projects.
- Conversion of announced project pipeline into signed, funded contracts, permits, construction and revenue; distinguish binding agreements from planned or conditional projects.
- Production capacity, quality and performance at Benavente and whether the company can reduce dependence on MagP and other limited suppliers.
- Progress in remediating material internal-control weaknesses and the effect of the long-term Benavente lease commitments on liquidity.
- Share-count consistency: the cover reports 13,805,648 shares at year-end, while the financial statements report 13,805,649.