VANCOUVER and
SOUTHBOROUGH, MA, Jan. 3, 2018
/CNW/ - Ballard Power Systems (NASDAQ: BLDP; TSX: BLDP) today
announced that, as a result of its strategic review in 2017 of its
Protonex subsidiary, the Company has recently implemented certain
changes at Protonex, including to narrow and sharpen the focus of
its business by divesting certain non-core assets. This divestiture
is expected to yield annualized cost savings of $1.4 million per year. This action is in addition
to steps taken in August 2017 to
reduce and align the Protonex cost base. Together, these actions
are expected to yield annualized cost savings of $2.6 million, better positioning Protonex to
deliver future profitability.
The Protonex business had three businesses: Power Manager,
Unmanned Aerial Vehicles (UAV's), and Solid Oxide Fuel Cells
(SOFC). In 2017 Ballard conducted a strategic review of each of
these business activities to determine the most effective strategic
course for each business.
Power Manager:
The Power Manager business has underperformed against
expectations, primarily due to unexpected delays in achieving a
certain procurement milestone in the U.S. Army's Program of Record.
Ballard initially expected to achieve this milestone in 2016;
however, the milestone was not achieved until September 2017. This Program of Record includes a
number of new devices focused on improving power and energy
management on and around the soldier, including Protonex' Squad
Power Manager Kit (SPM-622), conformal wearable batteries, and
man-worn power and data distribution devices, such as the Protonex
Vest Power Manager family. As a result of this milestone, which
enables full rate production status, Ballard now expects growth in
the Power Manager business beginning in 2018.
UAV:
Protonex has made significant progress in the UAV business, both
in the military market and the commercial market, including key
business planning, field trials and business development
activities. Ballard plans to re-brand the commercial UAV business
with the Ballard brand under the leadership of Phil Robinson, previously Vice President,
Defense Power Systems at Protonex, who was appointed as Vice
President, UAV.
SOFC:
With respect to the SOFC business, Protonex had been engaged in
certain product development and commercialization programs for
small-scale SOFC stationary power products. In 2017 it was
determined that these assets were not core to Ballard's proton
exchange membrane (PEM) fuel cell business, and the company decided
to divest these non-core assets. As a result, certain SOFC assets
were transferred to a private, start-up company, Upstart Power
Inc., effective December 31, 2017,
for nominal consideration. Initially, 10 Protonex employees have
moved to Upstart Power Inc., with an additional 6 employees
expected to be transferred later this year on completion of certain
Technology Solutions contracts. As part of this transfer of
employees, Dr. Paul Osenar,
previously President of Protonex, has moved to Upstart Power Inc.
as CEO. This action has enabled Ballard to significantly reduce the
cost structure at Protonex. Ballard has no ownership interest or
liabilities associated with Upstart Power Inc.
With Dr. Osenar's departure, Dave
Long, previously Vice President, Electronics and Systems at
Protonex, has been appointed interim General Manager at
Protonex.
About Ballard Power Systems
Ballard Power Systems
(NASDAQ: BLDP; TSX: BLDP) provides clean energy products that
reduce customer costs and risks, and helps customers solve
difficult technical and business challenges in their fuel cell
programs. To learn more about Ballard, please visit
www.ballard.com.
This release contains forward-looking statements concerning
anticipated product performance, customer benefits and market
demand for our products. 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
forward-looking statements are based on Ballard's assumptions
relating to its financial forecasts and expectations regarding its
product development efforts, manufacturing capacity, and market
demand.
These statements involve risks and uncertainties that may cause
Ballard's actual results to be materially different, including
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. Readers should not place undue reliance on
Ballard's forward-looking statements and Ballard assumes no
obligation to update or release any revisions to these forward
looking statements, other than as required under applicable
legislation.
This press release does not constitute an offer to sell or the
solicitation of an offer to buy securities. The Ballard
Common Shares have not been registered under the United States
Securities Act of 1933, as amended, or the securities laws of any
other jurisdiction and may not be offered or sold in the United States absent registration or an
applicable exemption from registration requirements.
SOURCE Ballard Power Systems Inc.