AFC Energy Reports FY25 Results: Strategic Pivot and Commercial Momentum Build for 2026

AFC Energy’s FY25: Strategy Reset, Cost-Down and a Pivot to Product Sales

AFC Energy’s final results for the year ended 31 October 2025 show a business that has tightened its focus and pushed hard towards commercialisation. The company has simplified its product set, cut costs and raised growth capital, all with one end in mind: sell low-carbon power and hydrogen at diesel-equivalent prices, without subsidies.

The centrepieces are the new LC30 30kW fuel cell generator and the Hy-5 containerised ammonia cracker, with delivery of Hy-5 targeted for late 2026. If AFC can convert its growing pipeline into firm orders in 2026, this year looks like the bridge from R&D to revenues.

Key FY25 Numbers at a Glance

Metric	FY25	FY24
Revenue	£125,000	£4.0 million
Loss after tax	£22.2 million	£17.4 million
Cash, cash equivalents and short-term investments (year end)	£25.3 million	£15.4 million
Cash (including short-term investments) at 31 Jan 2026	£20.4 million	not disclosed
Gross fundraising (July 2025 placing)	£27.5 million	-
R&D investment	£11.7 million	£9.5 million
R&D tax credits received (cash)	£1.6 million	£2.7 million

Note on the loss: non-cash items increased by £8.4 million, including stock and debtor write-offs of £5.5 million, higher depreciation/amortisation of £1.9 million, £0.5 million more in share-based payments and £0.5 million remuneration settled in equity.

Product roadmap that targets diesel equivalence

LC30 fuel cell: smaller, cheaper, simpler

• New 30kW liquid-cooled generator (LC30) launched post period.
• c. 85% lower cost than its predecessor, up to 20% more efficient, >95% fewer components and a substantially smaller footprint.
• Manufacturing partnership with Volex Plc to scale production capacity across multiple geographies.
• Multiple deployments of 30kW units via the Speedy Hydrogen Solutions JV through FY25, validating use cases from plant charging to welfare power.

Hy-5 ammonia cracker: on-site hydrogen at scale

• First hydrogen production product launched – Hy-5 – a portable, containerised cracker capable of producing up to 500 kg/day of hydrogen, with first deliveries targeted for end of calendar 2026.
• Hydrogen-as-a-service proposition targeting £10/kg, positioning AFC among the most cost-competitive low-carbon hydrogen suppliers in the UK.
• Environment Agency permit secured to sell hydrogen from the Dunsfold pilot, bringing revenue forward by 3-4 months.
• Joint Development Agreements advancing: an S&P 500 partner has completed phase one; and a c.$2 million JDA with Komatsu to integrate ammonia cracking with an industrial diesel engine platform.
• ICL joint venture on Teesside aims to produce bulk hydrogen at the lowest cost for UK industrial customers by the end of 2026 (subject to permitting).

Why this matters: cracking ammonia at the point of use reduces transport and storage headaches and could unlock off‑grid power and industrial decarbonisation where gas networks are absent. If AFC can hit £10/kg reliably, it’s a compelling entry point for early adopters.

Financial performance: a reset year explained

Revenue fell to £125,000 (from £4.0 million) as AFC stopped manufacturing the older AR2 generators and pivoted to defined products (LC30 and Hy-5). The loss after tax widened to £22.2 million, but includes significant non-cash charges from writing down legacy AR2 inventory (£2.6 million) and providing for receivables (£2.9 million), largely related to transitioning the Speedy JV to the new, lower-cost kit.

• Underlying operating costs look better than the headline suggests: adjusting for non-cash items, underlying costs were £13.4 million (FY24: £14.1 million).
• Cash discipline improved: quarterly cash burn reduced from £6.7 million (pre‑reset) to £2.9 million in the final quarter, despite restructuring and re‑energised development spend.
• Annualised savings of c.£1.5 million identified via footprint rationalisation (including the closure of the Stade facility), advisor reductions and a c.20% headcount realignment.

Cash, runway and funding

• Year-end cash and short-term deposits of £25.3 million; £20.4 million at 31 January 2026.
• Oversubscribed £27.5 million placing in July 2025 (net proceeds £25.8 million).
• Going concern supported to 28 February 2027 under a base case of moderate sales starting September 2026.
• Longer-term view: without a “sizable” increase in revenue or access to debt/equity, additional funding may be required in the second half of 2027.

On balance, the cash position gives AFC enough room to get LC30 into customers’ hands and progress Hy‑5 to first deliveries. The revenue ramp in FY26-FY27 is therefore the key swing factor.

Commercial momentum building into 2026

• Pre-orders are being targeted for LC30 and Hy-5 as the company leans into a “market push” approach.
• Fuel-as-a-Service (FaaS) to bundle hydrogen supply at a targeted £10/kg with generator deployments.
• Channel build-out: North America focus, TAMGO market review, and a European entry and partnership assessment.
• Demonstrated operational capability: the 200kW liquid-cooled system powered the FIA Extreme H World Cup event in Saudi Arabia, and a 200kW unit ran a 1.6 km conveyor under the UK Red Diesel Replacement grant programme, attracting £2.2 million in grant cash receipts.

My take: why this RNS matters for investors

What looks positive

• Clear productisation and dramatic cost-down on LC30 – the single biggest barrier to commercial adoption is being addressed head-on.
• Hy-5 targets a meaningful volume (500 kg/day) in a compact, portable form factor, with regulatory progress in hand and a defined delivery timeline.
• Manufacturing scalability via Volex, plus validation and potential routes to volume through JDAs (including Komatsu) and the Speedy JV channel.
• Cash runway into 2027, coupled with reduced burn and c.£1.5 million annualised cost savings.

What to watch (and the risks)

• Conversion risk: revenue was just £125,000 in FY25. 2026 must deliver signed orders and recognisable revenue to prove the model.
• Execution on Hy-5: delivery is targeted for the end of 2026. Any slippage would push back the hydrogen sales ramp and FaaS economics.
• Legacy clean-up: the AR2 inventory write-down and JV receivable provision are sensible in a reset, but underline past commercial friction. Future receivables discipline will matter.
• Funding beyond runway: management flags a potential need for additional capital in H2 2027 unless revenues scale materially or debt is secured.
• New lease commitment: a five-year head office lease from January 2026 (~£325,000 per year) adds fixed cost that needs offsetting with revenue growth.

What success looks like in 2026

• Visible order book for LC30 with first deliveries and utilisation data that support diesel-equivalent total cost of ownership.
• Hy-5 pilot hydrogen sales from Dunsfold continuing, plus firmed orders for containerised units ahead of late‑2026 delivery.
• At least one JDA moving from development into product or technology-led commercial revenues.
• Evidence of scalable manufacturing through Volex and a tightened supply chain feeding unit cost reductions.

Bottom line

This is a classic “reset year” set of results: light revenue, heavy non-cash clean-up and a lot of operational groundwork. The investment case now hangs on AFC Energy converting a healthy level of interest into LC30 and Hy‑5 orders, and proving it can consistently deliver low‑carbon power and hydrogen at compelling price points. If 2026 brings those conversions and the Hy‑5 timetable holds, the step-change to sustained revenues looks credible. If not, the funding question in 2027 will loom larger.

For now, the direction of travel is clear, the technology is being packaged for real-world use, and the cash runway is enough to give it a fair shot. One to watch closely through the next two quarters for order traction.