- Revenue of $23.7M, 23% Gross
Margin and ($5.0)M Adjusted
EBITDA
- Order Backlog expanded to $211.6M
at end-Q2
- 12-month Order Book increased 66% to $126.7M at end-Q2
VANCOUVER, July 31, 2019 /PRNewswire/ - Ballard Power
Systems (NASDAQ: BLDP; TSX: BLDP) today announced consolidated
financial results for the second quarter ended June 30, 2019. All amounts are in U.S. dollars
unless otherwise noted and have been prepared in accordance with
International Financial Reporting Standards (IFRS).
Randy MacEwen, President and CEO
said, "We are seeing unprecedented developments and interest in
fuel cell electric mobility, as reflected in our growing Order
Book. Financial results and new contract bookings for Q2 and
year-to-date were consistent with the type of first half to the
year we had expected. Ballard delivered Q2 revenue of $23.7 million, gross margin of 23%, Adjusted
EBITDA of ($5.0) million and ending
cash reserves of $163.7 million.
During Q2 we announced two notable developments that support our
business plan. First was a $44
million order from the Weichai-Ballard joint venture in
China. Second was our announcement
that Ballard is a member in the new H2Bus Consortium,
with plans to deploy 1,000 fuel cell electric buses in European
cities by 2023."
Mr. MacEwen noted, "The global megatrend toward electrification
of mobility is accelerating and putting increased momentum behind
fuel cell-based power for motive applications. There are clear
signals that the hydrogen and fuel cell industry is at an exciting
stage in its evolution. As we reiterate our full-year 2019 outlook,
we also note our expectations for strong growth in 2020 and beyond
to underpin Ballard's continued leadership in powering fuel cell
electric vehicles."
Q2 2019 Financial Highlights
(all comparisons are
to Q2 2018 unless otherwise noted)
- Revenue was $23.7 million, down
11% on a year-on-year basis, reflecting significantly lower
Heavy-Duty Motive and Portable Power/UAV revenues, partially offset
by increases in Technology Solutions and Material Handling.
- The Power Products platform generated revenue of $9.9 million, a decrease of 44%:
-
- Heavy Duty Motive revenue was $6.5
million, a decrease of 52% due primarily to lower
year-on-year membrane electrode assembly (MEA) shipments to
Synergy-Ballard JVCo;
- The Portable Power/UAV business generated $0.2 million, a decrease of 90% as a result of
lower revenues generated by Protonex primarily due to the
disposition of Power Manager assets in Q4 2018;
- Material Handling revenue was $2.8
million, an increase of 61% primarily due to higher stack
shipments to Plug Power, combined with the impact of a higher
average selling price due to product mix; and
- Telecom Backup Power revenue was $0.4
million, a decrease of 8% due primarily to a minor decline
in hydrogen-based backup power product and service revenues in
Europe and Japan.
- The Technology Solutions platform generated revenue of
$13.8 million, an increase of 61% due
primarily to amounts earned from the Weichai Ballard Hy-Energy
Technologies Co., Ltd. ("Weichai-Ballard JV") technology transfer
program, which more than offset minor declines in other programs in
the period.
- Gross margin was 23%, a 13-point decrease primarily reflecting
lower shipments of higher margin MEAs to Synergy-Ballard JVCo, and
lower higher margin revenues generated by Protonex due to the
disposition of Power Manager assets in Q4 2018.
- Cash operating costs2 were $8.4 million, a decrease of 20% primarily
attributable to lower product development costs combined with
decreases in sales and marketing costs.
- Adjusted EBITDA2 was ($5.0)
million in Q2, a decline of 526% or $4.2 million, primarily driven by the decrease in
gross margin resulting from the decline in overall revenues,
partially offset by the decrease in cash operating costs. Adjusted
EBITDA also included equity in loss of investment in joint venture
& associates of ($2.9) million,
primarily attributable to the establishment of operations of the
Weichai-Ballard JV.
- Net loss was ($7.0) million, a
decline of $2.7 million. Net loss
also included equity in loss of investment in joint venture &
associates of ($2.9) million,
primarily attributable to the establishment of operations of the
Weichai-Ballard JV.
- Net loss per share was ($0.03)
compared to ($0.02) in Q2 2018.
- Adjusted net loss2 was ($7.0)
million, a decline of $2.7
million. Adjusted net loss also included equity in loss of
investment in joint venture & associates of ($2.9) million, primarily attributable to the
establishment of operations of the Weichai-Ballard JV.
- Adjusted net loss per share2 was ($0.03) compared to ($0.02) in Q2 2018.
- Cash provided by operating activities was $1.7 million, an increase of $18.6 million reflecting working capital inflows
of $2.8 million, partially offset by
cash operating losses of ($1.1)
million.
- Cash reserves were $163.7 million
at June 30, an increase of 365% from
the end of Q2 2018 and approximately flat compared to the prior
quarter.
- During Q2 Ballard received $46.8
million in new orders and delivered orders valued at
$23.7 million, thereby increasing
Order Backlog to $211.6 million at
end-Q2, from $188.4 million in the
prior quarter. The 12-month Order Book also increased to
$126.7 million at end-Q2, from
$76.0 million in the prior
quarter.
Q2 2019 Operating Highlights
- Reached agreement with Weichai-Ballard JV for the supply of a
mix of certain fuel cell products and components with a total value
of $44 million to Ballard, planned
for delivery in 2019 and 2020.
- Launched the newest generation high performance fuel cell
module – FCmoveTM-HD – a compact and robust product that
offers a significant reduction in lifecycle cost utilizing
Ballard's LCS technology.
- Announced that Ballard is a founding member of the new H2Bus
Consortium, whose members are working together to deploy 1,000
zero-emission fuel cell electric buses (FCEBs) and related
infrastructure in European cities at commercially competitive
rates. An initial 600 FCEBs are being supported by a €40 million
grant from the EU's CEF program, with 200 buses to be deployed in
each of Denmark, Latvia and the U.K. by 2023, all powered by
Ballard's FCmoveTM-HD fuel cell module.
- Received a purchase order from Wrightbus for 20
FCveloCity®-HD fuel cell modules to power London, U.K. two deck, zero-emission buses
under the JIVE funding program. All the modules are expected to
ship in 2019 and the buses will support London's world-first Ultra Low Emission Zone
initiative, which was launched this year to improve air
quality.
- Subsequent to the quarter received a purchase order from
Wrightbus for 15 FCveloCity®-HD fuel cell modules to
power Aberdeen, Scotland two deck,
zero-emission buses under the JIVE funding program. The modules are
expected to ship in 2019.
- Subsequent to the quarter received a purchase order from
Solaris Bus & Coach for 12 FCmoveTM-HD fuel cell
modules to power Bolzano, Italy
buses under the JIVE program. The modules are expected to ship in
2020.
- Announced that Ballard will provide 6 FCmoveTM-HD
fuel cell modules to power 2 tractor-trailer trucks as part of an
industry-lead C$15 million
(US$11.2 million) Alberta
Zero-Emissions Truck Electrification Collaboration (AZETEC)
project, which will test the ability of hydrogen to fuel the
Province of Alberta's heavy duty
freight transportation sector.
- Announced collaboration with ABB and other consortium partners
in the Flagships project to develop and launch a zero-emission
river push boat planned for deployment in 2021. The boat will push
barges on the Rhône River in France using 2 Ballard
FCmoveTM 200 kilowatt fuel cell modules.
Q2 2019 Financial Summary
(Millions of U.S.
dollars)
|
Three months ended June
30,
|
Six months ended June 30,
|
|
2019
|
2018
|
% Change
|
2019
|
2018
|
% Change
|
GROWTH
|
|
|
|
|
|
|
Fuel Cell Products
& Services Revenue:1
|
|
|
|
|
|
|
Heavy Duty
Motive
|
$6.5
|
$13.3
|
-52%
|
$9.0
|
$22.6
|
-60%
|
Portable
Power/UAV
|
$0.2
|
$2.4
|
-90%
|
$0.4
|
$4.8
|
-92%
|
Material
Handling
|
$2.8
|
$1.7
|
61%
|
$6.0
|
$2.1
|
180%
|
Backup
Power
|
$0.4
|
$0.4
|
-8%
|
$0.8
|
$0.7
|
14%
|
Sub-Total
|
$9.9
|
$17.8
|
-44%
|
$16.2
|
$30.2
|
-46%
|
Technology
Solutions
|
$13.8
|
$8.6
|
61%
|
$23.5
|
$16.3
|
44%
|
Total Fuel Cell
Products & Services Revenue
|
$23.7
|
$26.4
|
-11%
|
$39.7
|
$46.5
|
-15%
|
PROFITABILITY
|
|
|
|
|
|
|
Gross Margin
$
|
$5.6
|
$9.4
|
-41%
|
$7.8
|
$16.0
|
-52%
|
Gross Margin
%
|
23%
|
36%
|
-13-point
|
20%
|
34%
|
-14-points
|
Operating
Expenses
|
$10.2
|
$12.5
|
-19%
|
$20.9
|
$25.2
|
-17%
|
Cash Operating
Costs2
|
$8.4
|
$10.5
|
-20%
|
$17.7
|
$21.2
|
-16%
|
Equity gain (loss) in
JV & Associates
|
($2.9)
|
($0.1)
|
3,352%
|
($4.8)
|
($0.1)
|
3,592%
|
Adjusted
EBITDA2
|
($5.0)
|
($0.8)
|
-526%
|
($13.6)
|
($4.6)
|
-193%
|
Net Loss
|
($7.0)
|
($4.3)
|
-61%
|
($19.0)
|
($9.8)
|
-93%
|
Net Loss Per
Share
|
($0.03)
|
($0.02)
|
-25%
|
($0.08)
|
($0.06)
|
-26%
|
Adjusted Net
Loss2
|
($7.0)
|
($4.3)
|
-61%
|
($17.0)
|
($9.8)
|
-73%
|
Adjusted Net Loss Per
Share2
|
($0.03)
|
($0.02)
|
-25%
|
($0.07)
|
($0.06)
|
-13%
|
CASH
|
|
|
|
|
|
|
Cash Provided (Used)
by Operating Activities:
|
|
|
|
|
|
|
Cash Operating Income
(Loss)
|
($1.1)
|
($1.6)
|
-31%
|
($6.7)
|
($4.4)
|
-55%
|
Working Capital
Changes
|
$2.8
|
($15.3)
|
118%
|
($2.0)
|
($19.7)
|
90%
|
Cash Provided (Used)
By Operating Activities
|
$1.7
|
($16.9)
|
110%
|
($8.7)
|
($24.1)
|
64%
|
Cash
Reserves
|
$163.7
|
$35.2
|
365%
|
|
|
|
For a more detailed discussion of Ballard Power Systems' second
quarter 2019 results, please see the company's financial statements
and management's discussion & analysis, which are available at
www.ballard.com/investors, www.sedar.com and
www.sec.gov/edgar.shtml.
Conference Call
Ballard will hold a conference call on
Thursday, August 1, 2019 at
8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review second quarter
2019 operating results. The live call can be accessed by dialing
+1.604.638.5340. Alternatively, a live audio and slide webcast
can be accessed through a link on Ballard's homepage
(www.ballard.com). Following the call, the audio webcast and
presentation materials will be archived in the Earnings, Interviews
& Presentations area of the Investors section of Ballard's
website (www.ballard.com/investors).
About Ballard Power Systems
Ballard Power Systems'
(NASDAQ: BLDP; TSX: BLDP) vision is to deliver fuel cell power for
a sustainable planet. The Company builds fuel cell products that
reduce customer costs and risks, and helps customers solve
difficult technical challenges or address new business
opportunities. To learn more about Ballard, please visit
www.ballard.com.
Important Cautions Regarding Forward-Looking
Statements
This release contains forward-looking statements
concerning projected revenue growth, product shipments, gross
margin, Adjusted EBITDA, cash operating expenses and product sales.
These forward-looking statements reflect Ballard's current
expectations as contemplated under section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Any such statements are based on Ballard's
assumptions relating to its financial forecasts and expectations
regarding its product development efforts, manufacturing capacity,
and market demand. For a detailed discussion of the factors and
assumptions that these statements are based upon, and factors that
could cause our actual results or outcomes to differ
materially, please refer to Ballard's most recent management
discussion & analysis. Other risks and uncertainties that may
cause Ballard's actual results to be materially different include
general economic and regulatory changes, detrimental reliance on
third parties, successfully achieving our business plans and
achieving and sustaining profitability. For a detailed discussion
of these and other risk factors that could affect Ballard's future
performance, please refer to Ballard's most recent Annual
Information Form. These forward-looking statements are provided to
enable external stakeholders to understand Ballard's
expectations as at the date of this release and may not be
appropriate for other purposes. Readers should not place undue
reliance on these statements and Ballard assumes no obligation to
update or release any revisions to them, other than as required
under applicable legislation.
Endnotes:
1
|
We report our results
in the single operating segment of Fuel Cell Products and Services.
Our Fuel Cell Products and Services segment consists of the sale
and service of PEM fuel cell products for our power product markets
of Heavy Duty Motive (consisting of bus, truck, rail and marine
applications), Portable Power/UAV, Material Handling and Backup
Power, as well as the delivery of Technology Solutions, including
engineering services, technology transfer and the license and sale
of our extensive intellectual property portfolio and fundamental
knowledge for a variety of fuel cell applications.
|
|
|
2
|
Note that Cash
Operating Costs, EBITDA, Adjusted EBITDA and Adjusted Net Income
(Loss), are non GAAP measures. Non GAAP measures do not have any
standardized meaning prescribed by GAAP and therefore are unlikely
to be comparable to similar measures presented by other companies.
Ballard believes that Cash Operating Costs, EBITDA, Adjusted EBITDA
and Adjusted Net Income (Loss) assist investors in assessing
Ballard's operating performance. These measures should be used in
addition to, and not as a substitute for, net income (loss), cash
flows and other measures of financial performance and liquidity
reported in accordance with GAAP. For a reconciliation of Cash
Operating Costs, EBITDA, Adjusted EBITDA and Adjusted Net Income
(Loss) to the Consolidated Financial Statements, please refer to
Ballard's Management's Discussion & Analysis.
|
|
|
|
Cash Operating Costs
measures operating expenses excluding stock based compensation
expense, depreciation and amortization, impairment losses or
recoveries on trade receivables, restructuring charges, the impact
of unrealized gains or losses on foreign exchange contracts,
acquisition costs and financing charges. EBITDA measures net loss
excluding finance expense, income taxes, depreciation of property,
plant and equipment, and amortization of intangible assets.
Adjusted EBITDA adjusts EBITDA for stock based compensation
expense, transactional gains and losses, asset impairment charges,
the impact of unrealized gains or losses on foreign exchange
contracts, finance and other income, and acquisition costs.
Adjusted Net Income (Loss) measures net income (loss) excluding
transactional gains and losses, asset impairment charges, and
acquisition costs.
|
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SOURCE Ballard Power Systems Inc.