Dear Fellow H2X Shareholders & Supporters,
Today is World Hydrogen Day, a date that has particular significance for H2X.
Exactly two years ago, on 8 October 2024, H2X was named the AFR BOSS Most Innovative Company in the Property, Construction and Transport category.
That recognition was an important milestone for the Company. It acknowledged the technology H2X had developed and the potential for an Australian hydrogen business to contribute meaningfully to a global transition towards cleaner transport and energy.
Two years on, H2X has moved considerably further along that journey.
We have progressed from concepts and development programmes to selling and delivering H2X products into two countries. Our Type IV hydrogen storage technology has moved from design, testing and certification into commercial production and real-world operation. We have contracted customers, established a significantly stronger European manufacturing pathway and fundamentally reshaped the cost base and operating model of the Company.
That does not mean the work is complete. Far from it. Vehicle delivery remains one of the most important milestones ahead of us, and there is still considerable execution required before H2X reaches the scale we are working towards.
But it is equally important to recognise how much the Company has changed.
Two years ago, the central question was largely: Can H2X develop and prove this technology?
Today, the question is increasingly: How quickly and efficiently can we commercialise it?
That is a very different stage in the life of the Company, and it is the transition I want to focus on in this letter.
The timing is also particularly relevant because earlier this week The Australian Financial Review published a Street Talk article regarding H2X and our current capital raising. From the calls, emails and messages I have received since its publication, I am aware that the headline caused concern for some shareholders.
I want to address that directly.
The language used in capital-markets reporting can sometimes sound more dramatic than the underlying circumstances, particularly when read without the context of the updates we have been providing over time. In this instance, the matters discussed in the article, our current capital raising, the restructuring of the Company, our leaner operating model and our focus on commercial delivery, should already be familiar to shareholders who have followed H2X.
There has been no sudden change in strategy.
What has changed is that H2X is now further advanced in executing it.
Before turning to the AFR article in more detail, however, I want to start with today, World Hydrogen Day, and what it says about the market H2X is building into.
World Hydrogen Day: Representing H2X in Western Australia
I was pleased today to represent H2X at the Australia Hydrogen Day event at Murdoch University in Western Australia, where I presented the H2X story and subsequently joined the industry panel discussion.
My thanks to the Hydrogen Society of Australia, Murdoch University and everyone involved in organising the event. It brought together people from industry, government, the United Nations, academia and across the broader hydrogen sector, and provided an excellent opportunity to talk about where hydrogen is moving from ambition into practical deployment.
I was disappointed not to be able to attend in Perth in person. Western Australia is one of the most compelling places in the world to discuss hydrogen because the scale of what is being contemplated there is enormous. InterContinental Energy’s two major WA renewable-energy and hydrogen developments together cover project areas approaching the size of Belgium, illustrating the potential supply side of the future hydrogen economy.
H2X operates primarily on the other side of that equation, developing the vehicles, storage systems and potentially clean-power products that create demand for hydrogen.
The two need each other.
Europe is also beginning to put hard deadlines around this transition. Hamburg, for example, voted last year to bring its net CO₂-neutrality target forward to 2040. European heavy-vehicle emissions standards continue to tighten, while hydrogen infrastructure is being progressively mandated across major transport corridors.
That matters because a commercial vehicle purchased today may still be operating well into the 2030s.
The transition is therefore no longer something fleet operators can leave until 2039.
Procurement decisions are increasingly being made now.
For H2X, that is the commercial environment into which we are seeking to deliver products.
The AFR Article, “Rattling the Tin”
Yesterday’s print of the AFR Street Talk column ran the headline: “Hydrogen-powered vehicle business H2X Global rattles tin for comeback.” I understand why the wording caught shareholders’ attention. The expression “rattling the tin” is, however, standard Australian capital-markets shorthand for raising capital.
It is not terminology unique to H2X. The AFR uses the expression regularly. A search of its own reporting produces almost 100 examples covering everything from early-stage and pre-IPO businesses through to listed companies and transactions involving some of Australia’s largest corporate names. It has been used in AFR reporting concerning companies such as Lendlease and Hancock Prospecting, as well as mining groups, technology businesses and private-equity transactions.
Put simply, H2X is “rattling the tin” because H2X is raising capital.
There should not have been anything materially new in the article about H2X’s strategy, current capital raising or funding pathway.
We have discussed the restructuring of H2X and the substantial reduction in our fixed cost base. We have also been open about our strategy of using established external engineering and manufacturing partners rather than carrying the cost of recreating those capabilities inside H2X.
None of those things suddenly appeared because the AFR wrote about them. The AFR article did not create a new financing requirement and it did not signal a change in strategy. It reported on the financing process we are already undertaking.
I appreciate that shareholders who have supported H2X over a number of years can react strongly when they see their Company described in unfamiliar newspaper language. Headlines are necessarily short and designed to attract attention.
But the underlying story is considerably more important. Two years ago today, the AFR was writing about H2X because the Company had been recognised for innovation.
This week its capital-markets journalists are writing about H2X because we are undertaking a sophisticated-investor funding round as we move towards commercial delivery and, ultimately, the public markets.
As H2X progresses, that wider financial-market scrutiny and visibility will become increasingly normal.
From Setback to a Stronger Manufacturing Model
One of the more difficult events of the past two years was the insolvency of H2X’s previous Dutch vehicle-production supplier. The business had been working on the first vehicle and its insolvency created both delay and financial impact for H2X.
What matters is how H2X responded.
Rather than simply replacing one supplier with another and continuing with the same model, we used the disruption to reassess how H2X should manufacture vehicles. That process led us to FES GmbH in Zwickau, Germany, an established automotive engineering and manufacturing business with materially better economics for H2X.
The move to FES has ultimately given H2X a more scalable, capital-efficient production pathway. It is a good example of how the Company has changed: fewer fixed costs inside H2X, greater use of established specialist partners and more shareholder capital concentrated on technology, intellectual property, integration, customers and commercial execution.
Frank Advisory: The Team We Wanted
I am also very pleased to formally confirm that H2X has appointed Frank Advisory to lead the current capital raising.
This is an appointment I have wanted to be able to announce for some time.
Shareholders may remember that I have previously written about H2X receiving proposals and approaches from other corporate advisers and our decision not to proceed with some of them.
That was deliberate.
We did not want to appoint an adviser simply so we could say that we had one.
We had identified a particular team with whom we believed H2X could work well through this next stage, and we were prepared to wait.
I am therefore delighted that Frank Advisory is that firm.
The Frank team has spent considerable time understanding H2X, not simply the technology, but the economics, customers, costs, history, funding requirements and the milestones that investors should reasonably expect management to deliver.
I have appreciated the level of challenge involved.
A useful corporate adviser should not simply reproduce management’s optimism. The process has required us to test what H2X really owns, what has genuinely been commercialised, how much capital is required to reach the next milestones, what that capital should achieve and which future opportunities are sufficiently advanced to form part of the financial case rather than remain potential upside. Those conversations have helped make the H2X proposition clearer and, I believe, stronger.
A Timely Reminder on Existing Options
There is also a separate matter relevant to a number of existing shareholders.
Several classes of H2X options are due to expire over the coming weeks. Whether an individual shareholder chooses to exercise those options is entirely a matter for them, having regard to their own circumstances and the terms applying to their securities.
H2X cannot provide personal financial advice and, if you are in any doubt about whether exercising your options is appropriate for you, you should seek advice from your financial adviser or other appropriately qualified professional.
With a number of expiry dates approaching, I encourage option holders to review their positions and the relevant documentation now rather than leaving any decision or administrative process until the final days.
If you are uncertain whether you hold options approaching expiry, or require copies of the relevant exercise documentation, please contact us and we will be happy to assist with the administrative information.
For those shareholders, it is quite literally a timely opportunity to consider your options.
Looking Ahead to Potential Future H2X Vehicles
Danny Bernstein and I also recently spent time inspecting and driving several battery-electric commercial vehicles as possible donor platforms for future H2X products.
It was a very useful exercise.
Our thinking about future H2X vehicles continues to evolve, particularly as more credible battery-electric commercial platforms become available.
Historically, converting an internal-combustion vehicle into a hydrogen-electric vehicle requires a considerable amount of engineering. You first remove the combustion drivetrain and then effectively build much of the electric architecture that replaces it.
Starting with a modern battery-electric commercial vehicle could allow us to approach the problem differently.
The motor, inverter, high-voltage system, power electronics and much of the vehicle’s safety and control architecture are already there. The engineering challenge then becomes how intelligently H2X can integrate its hydrogen storage, fuel-cell and energy-management technology around that existing electric platform.
Potentially, that provides a route to a hydrogen range-extended electric commercial vehicle with less bespoke engineering, shorter development times and lower overall development cost.
Danny and I both came away encouraged by what we saw.
Importantly, this opportunity is not relied upon in the current financing base case. It represents a potential improvement to H2X’s future development model rather than an assumption required for the current plan to succeed.
There is still considerable engineering and commercial work required before H2X makes any decision on a future donor platform. But the concept fits precisely with the philosophy that now underpins H2X: do not engineer from scratch what we can intelligently inherit from a proven platform.
That is not simply an engineering principle.
It is a capital-allocation principle.
Australian Technologies Competition: Independent Assessment of the H2X Business Case
Last month H2X was named a finalist of the 2026 Australian Technologies Competition.
The significance of that result goes well beyond simply reaching another awards final.
The competition ran over several months and attracted 249 applicants from across Australia. From that initial field, 95 companies progressed to the semi-finals before just 33 were selected as finalists.
Importantly, that selection was not based on a short pitch or a marketing presentation.
As part of the process, H2X was required to prepare and submit a detailed Concise Business Plan covering the technology, market opportunity, commercial model, customers, competitive position, management capability, financial requirements, risks and pathway to scale. The competition confirmed that its judging panel would select the finalists on the basis of that business plan, with the assessment undertaken by panels of experienced industry leaders, investors and technology experts.
For H2X, that provided another useful layer of independent assessment of the underlying business fundamentals.
We have spent a considerable amount of time internally, and more recently with Frank Advisory, testing exactly the same questions: what H2X owns, why customers need the products, how we manufacture them efficiently, where the revenue comes from, how much capital is required and whether the business can ultimately scale.
Progressing through several stages of the Australian Technologies Competition and being selected as a finalist after an independent review of that business plan does not, of course, remove the execution work still ahead of us. But it does provide external validation that experienced people outside H2X can see merit in the technology, the commercial strategy and the business model we are now building.
The competition also helped sharpen how we describe H2X.
For many years, the Company has necessarily been discussed in terms of fuel cells, high-pressure hydrogen tanks, power electronics, software, homologation and complex vehicle engineering. All of that remains important, but the commercial proposition is becoming much simpler.
H2X develops and owns hydrogen technology. We combine that technology with established vehicle platforms and specialist engineering and manufacturing partners, and we commercialise products in applications where hydrogen provides a genuine operating advantage.
Two years ago, much of that proposition was still being discussed in terms of technology development and prototypes.
Today, H2X is selling and delivering actual product. This progression matters.
The challenge ahead is now to repeat that success across our commercial vehicle programmes and demonstrate that the same capital-efficient model can move H2X from individual product sales into recurring revenue and greater scale.
In that respect, I see our selection as an Australian Technologies Competition finalist not simply as recognition of H2X’s technology, but as independent support for the commercial direction the Company has taken.
Audit, R&D and the Path to Public Markets
At the same time as we progress the commercial work, we continue to strengthen the corporate and financial foundations required for the next stage of H2X.
The FY2026 audit is approaching completion, which will provide shareholders, prospective investors and our advisers with a more current independently audited financial base from which to assess the Company and progress the next stages of our corporate development.
Our Australian Research & Development Tax Incentive also remains an important part of that foundation. H2X has undertaken substantial engineering and technology development across multiple jurisdictions, and the R&D programme provides an important mechanism through which qualifying expenditure can be supported without relying solely on additional shareholder capital.
Importantly, H2X previously received a positive Overseas Finding from AusIndustry, covering eligible overseas R&D activities. That finding was significant because it provided greater certainty around the eligibility of qualifying overseas development work undertaken as part of H2X’s broader technology programme.
We have appreciated our engagement with AusIndustry and the support available through the Australian Government’s R&D framework, which supports Australian technology companies undertaking qualifying development work, including specialised work undertaken internationally. For H2X, that support has been important as we continue to develop and retain our core technology and intellectual property within the H2X Global group.
We continue working towards the FY2026 R&D Tax Incentive claim, which remains an important source of non-dilutive funding and improves the efficiency with which shareholder capital can be deployed into engineering and commercialisation.
Our proposed public listing remains another important strategic objective, but a listing does not make an industrial company successful. A stronger company, with credible technology, customers, audited financials, disciplined use of capital and demonstrable commercial execution, is what creates the foundation for a successful listing.
Two Years On
Two years ago today, H2X was recognised by the AFR for innovation. At that point, much of the value in the Company was still being demonstrated through engineering, prototypes and the potential of the technology. Today, H2X is in a very different position. We are selling and delivering H2X products into two countries, our certified hydrogen storage technology is operating in the real world, we have a contracted vehicle customer, an established European manufacturing pathway and a substantially leaner operating model.
The journey between those two points has not been without difficulty. We have had to make hard decisions, materially reduce costs and respond to setbacks that were not of our making. The insolvency of our former vehicle supplier was one of those setbacks. But the response to it ultimately led H2X to FES and to a manufacturing model that is materially more efficient and scalable than the one it replaced.
That experience is important because it says something about the Company H2X has become. We are no longer trying to build every capability ourselves or measure progress by the size of the organisation. We are increasingly focused on owning the technology, protecting the intellectual property, working with the right specialist partners and concentrating shareholder capital where it has the greatest potential to create commercial value.
The same discipline now underpins the current capital raising.
The purpose of this financing is not to take H2X backwards and rebuild the cost structure of the past. It is to move the Company forward, to convert the technology, customers, manufacturing relationships and commercial opportunities already established into delivery and revenue.
That is also why the appointment of Frank Advisory is important. We waited for the team we wanted to work with, and the process of preparing the current Information Memorandum and financial model has required both management and our advisers to test the H2X proposition rigorously: what has already been achieved, what remains to be delivered, what capital is required to get there and which future opportunities should remain upside rather than assumptions in the base case.
I am conscious that some shareholders were unsettled by this week’s AFR headline. I hope this letter provides the appropriate context. The fact that H2X is raising capital is not new, nor is the strategy behind that capital raising. What is different today is that the Company is further advanced, the operating model is leaner, the use of funds is more clearly defined and the next commercial milestones are increasingly tangible.
I am not asking shareholders to ignore the work that remains or the risks involved. Capital still has to be secured. The vehicles still have to be delivered. We need to continue growing storage sales, strengthen our commercial capability in Europe and demonstrate that the opportunities we see can be converted into sustainable revenue.
But I believe shareholders should also recognise the progress that has been made.
H2X has moved from proving technology to commercialising it.
That distinction matters.
Our next phase should not be judged by the number of concepts we announce or presentations we make. It should be judged by execution: products delivered, customers added, revenues generated and shareholder capital deployed with discipline.
Our proposed public listing remains an important objective, but a listing does not make an industrial company successful. A strong company creates the foundation for a successful listing. This is the H2X we are working to build.
I remain acutely conscious that the technology, intellectual property and opportunities we have today have been built with the support and capital of our shareholders. That brings with it a responsibility on the Board and management not simply to describe what H2X could become, but to demonstrate it through measurable commercial outcomes.
Exactly two years ago today, H2X was recognised for innovation.
The next chapter must be defined by delivery.
Thank you, as always, for your patience, confidence and continued support of H2X.
And on behalf of everyone at H2X Global, Happy World Hydrogen Day.
Kind regards
Antony Tolfts
Chief Executive Officer