Proton Motor Power Systems PLC on Wednesday said that hesitancy in the hydrogen fuel cell market has brought about a more than 30% reduction in half-year revenue, with the company at risk of ceasing its operations by the year-end.

The London-based designer and producer of hydrogen fuel cells and hydrogen fuel cell electric hybrid systems said its revenue for the six months up to June 30 was £624,000, falling 33% on-year from £929,000.

Cost of sales fell 16% to £765,000 from £914,000, while administrative costs rose 1.6% to £6.3 million from £6.2 million.

The company said it is clear that awareness of the use of hydrogen as a future energy source is growing, and that demand for associated technologies is ‘increasing substantially’ too.

However, Chair Antonio Bossi said: ‘Although we are seeing additional repeat orders from key customers post testing our systems, together with multiple indications at the political and market level that support and promote the massive potential of hydrogen related applications, trading during the first half of 2024 proved to be extremely challenging with potential customers being hesitant to make substantial investments in hydrogen fuel cells, within the current market.’

The company said, as it continues to make a loss, that ‘in the absence of securing financing or being able to draw upon the 2024 facility beyond the end of the year, there is a very high risk that the company will not be able to operate beyond December 31, 2024’.

In this instance, the company would seek to cancel the trading of its shares on AIM, and in anticipation of this, the board will ‘immediately’ begin taking steps to reduce the company’s overheads. This will include a further significant reduction in headcount.

Shares in Proton Motor Power Systems fell 8.0% to 0.78 pence each in London on Wednesday afternoon.

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