FuelCell Energy, Inc. (Nasdaq: FCEL), a global leader in delivering
localized, always on, sustainable clean energy, today reported
financial results for its fourth fiscal quarter of 2019 and its
fiscal year ended October 31, 2019 and provided details of its new
business strategy.
“Our results in the fourth fiscal quarter and
the full fiscal year reflect our focused execution on right-sizing
FuelCell Energy, exiting opportunities that did not meet our margin
objectives, and positioning the Company for growth in 2020 and
beyond,” commented Jason Few, President and Chief Executive Officer
of FuelCell Energy. “We accomplished a number of strategic
initiatives to strengthen our balance sheet and improve our cost
structure as we focus on delivering our significant project
backlog, which is expected to result in recurring cash flow from
our generation assets.”
Fourth Quarter of Fiscal 2019
Results(All results reflect year-over-year comparisons
unless otherwise noted)
Revenue of $11.0 million represents a 38%
decrease year-over-year and reflects the Company’s previous
decision to deemphasize Product sales to focus on utility scale
Power Purchase Agreement (“PPA”) opportunities, and grow our
generation portfolio. This revenue decrease was partially offset by
the Company’s increased Generation and Advanced Technologies
contract revenues.
- Generation revenues increased by
206% to $5.5 million from $1.8 million as a result of the
acquisition of the 14.9 megawatt (“MW”) Bridgeport Fuel Cell
Project in 2019, which increased generation assets by 133% to 26.1
MW from 11.2 MW on a year-over-year basis.
- Advanced Technologies contract
revenues increased by 16% to $4.3 million from $3.7 million due to
increased activity, mainly in conjunction with the carbon capture
joint development agreement with ExxonMobil Research and
Engineering Company.
- Service and License revenues
decreased by 72% to $0.8 million from $2.9 million, driven by the
timing of planned service work performed in the comparative
periods.
- Product sales totaled $0.5 million
for the quarter, a decline of 95% when compared to product sales of
$9.4 million in the comparable quarter. The difference between the
periods is primarily due to the inclusion of the sale of the
Trinity College fuel cell project in the fourth fiscal quarter of
2018.
Gross loss for the fourth fiscal quarter of 2019
totaled $(23.4) million, compared to gross profit of $1.1 million
in the fourth fiscal quarter of 2018. Results for the fourth fiscal
quarter of 2019 include a noncash charge of $14.4 million due to a
decision by the Company to operate the Triangle Street Project
under a merchant model (selling electricity under tariff to the
grid and without an executed power purchase agreement) for the next
5 years. Results also include a noncash charge of $3.1
million for the Bolthouse Farms Project because management has
decided to pursue termination of the PPA related to the Bolthouse
Farms Project given recent regulatory changes impacting the future
cost profile for the Company and Bolthouse Farms.
Operating expenses for the fourth fiscal quarter
of 2019 decreased by 26% to $9.6 million, compared to $13.0 million
in the fourth fiscal quarter of 2018. Research and development
expenses of $1.4 million reflect lower headcount and overhead as a
result of restructuring activities during fiscal 2019 and an
increased allocation of efforts to revenue producing activity.
Administrative and selling expenses at $8.2 million were higher
than in the fourth fiscal quarter of 2018 as a result of
extraordinary legal and consulting costs incurred by the Company in
connection with its restructuring, liquidity and refinancing
initiatives. This expense category is expected to trend down in
fiscal 2020 as those efforts are now complete.
Adjusted EBITDA loss totaled $(11.0) million in
the fourth fiscal quarter of 2019 compared to $(8.8) million in the
fourth fiscal quarter of 2018. (Adjusted EBITDA is a non-GAAP
financial measure that represents adjusted earnings before
interest, taxes, depreciation and amortization.) Please see the
discussion of non-GAAP financial measures and Adjusted EBITDA in
the appendix at the end of this release.
The net loss per share attributable to common
stockholders in the fourth fiscal quarter of 2019 was $(0.23),
compared to $(2.31) in the fourth fiscal quarter of 2018.
Fiscal 2019 Results(All results
reflect year-over-year comparisons unless otherwise noted)
Revenue of $60.8 million represents a 32%
decrease in revenue year-over-year, which was primarily a result of
the Company’s previous strategic decision to focus on utility scale
PPA business opportunities to grow the generation portfolio rather
than selling our projects at completion, and the Company’s
continuing inability to access the Asian markets as a result of the
situation with POSCO Energy, partially offset by increased Service
and License revenues, Generation revenues, and Advanced
Technologies contract revenues.
- Generation revenues increased 96%
to $14.0 million from $7.2 million due to additional revenue
recorded for the 14.9 MW Bridgeport Fuel Cell Project, which was
acquired in May 2019.
- Advanced Technologies contract
revenues increased 40% to $19.6 million from $14.0 million due to
the timing of project activity under existing contracts.
- Service and License revenues
increased 69% to $26.6 million from $15.8 million, mainly due to
revenues of $10.0 million recorded in connection with our license
agreement with ExxonMobil Research and Engineering Company during
the fiscal year ended October 31, 2019.
- Product sales for the fiscal year
consisted of $0.5 million of power plant revenue compared to $52.5
million of product revenues for the fiscal year ended October 31,
2018, which included sales from the 20 MW fuel cell project for
Korea Southern Power Company and the sale to Clearway Energy of a
2.8 MW fuel cell power plant project in Tulare, California.
Gross loss in fiscal 2019 totaled $(21.3)
million, compared to gross profit of $3.1 million in fiscal 2018.
Fiscal 2019 results include one-time, noncash impairment charges of
$20.4 million.
Operating expenses for fiscal 2019 decreased 4%
to $45.7 million compared to $47.7 million in fiscal 2018. Research
and development expenses of $13.8 million in fiscal 2019 compared
to $22.8 million in fiscal 2018. This decrease reflects the
reduction in spending resulting from the restructuring initiatives
and the reassignment of personnel from internal research and
development activities to funded Advanced Technologies projects.
Administrative and selling expenses of $31.9 million in fiscal 2019
were higher than in fiscal 2018 as a result of atypical legal and
consulting costs related to the Company’s restructuring, liquidity
and refinancing initiatives.
Adjusted EBITDA in fiscal 2019 improved 4% to
($31.4) million, compared to ($32.7) million in fiscal 2018. Please
see the discussion of non-GAAP financial measures and adjusted
EBITDA in the appendix at the end of this release
Net loss per basic and diluted share
attributable to common stockholders for the fiscal 2019 was $(1.82)
compared to $(9.01) in fiscal 2018.
Key Consolidated Financial Metrics
|
Three Months Ended October 31, |
|
Twelve Months Ended October 31 |
(Amounts in thousands) |
|
2019 |
|
|
|
2018 |
|
|
Change |
|
|
2019 |
|
|
|
2018 |
|
|
Change |
Total revenues |
$ |
11,041 |
|
|
$ |
17,884 |
|
|
-38 |
% |
|
$ |
60,752 |
|
|
$ |
89,437 |
|
|
-32 |
% |
Gross (loss) profit |
|
(23,389 |
) |
|
|
1,143 |
|
|
-2,146 |
% |
|
|
(21,269 |
) |
|
|
3,093 |
|
|
-788 |
% |
Loss from operations |
|
(32,992 |
) |
|
|
(11,870 |
) |
|
-178 |
% |
|
|
(66,929 |
) |
|
|
(44,632 |
) |
|
-50 |
% |
EBITDA |
|
(28,958 |
) |
|
|
(9,747 |
) |
|
-197 |
% |
|
|
(54,576 |
) |
|
|
(35,984 |
) |
|
-52 |
% |
Net loss to common stockholders |
|
(36,003 |
) |
|
|
(17,929 |
) |
|
-101 |
% |
|
|
(100,245 |
) |
|
|
(62,168 |
) |
|
-61 |
% |
Net loss per basic and diluted share |
$ |
(0.23 |
) |
|
$ |
(2.31 |
) |
|
90 |
% |
|
$ |
(1.82 |
) |
|
$ |
(9.01 |
) |
|
80 |
% |
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA |
$ |
(10,959 |
) |
|
$ |
(8,818 |
) |
|
-24 |
% |
|
$ |
(31,412 |
) |
|
$ |
(32,746 |
) |
|
4 |
% |
Strategy Update
In a separate release today, FuelCell Energy
announced its comprehensive strategy to strengthen its business and
maximize operational efficiencies, which is expected to enable the
Company to capture future growth opportunities by executing of its
core business, focusing on customer relationships, delivering on
and expanding its project backlog, and developing and
commercializing new technologies with it partners. Access the
release.
“My first full quarter as CEO has been a pivotal
time for FuelCell Energy, during which we have worked together with
our Board, as a management team, and with our stakeholders and
suppliers to complete the restructuring phase of our strategy,”
said Jason Few. “Having accomplished our initial objectives
of building a financial foundation to move forward with our new
business, today we unveiled the pillars of our Powerhouse
transformation strategy: Transform, Strengthen, and Grow. We are
fully focused on successfully executing our project commitments and
positioning the Company to deliver positive earnings.”
Backlog
|
As of October 31, |
|
|
(Amounts
in thousands) |
|
2019 |
|
|
2018 |
|
Change |
Product |
$ |
- |
|
$ |
1 |
|
- |
|
Service(1) |
|
169,371 |
|
|
251,650 |
|
-33 |
% |
Generation |
|
1,114,366 |
|
|
839,483 |
|
33 |
% |
License(2) |
|
22,931 |
|
|
- |
|
- |
|
Advanced
Technologies |
|
11,978 |
|
|
32,383 |
|
-63 |
% |
Total Contract Backlog |
$ |
1,318,646 |
|
$ |
1,123,517 |
|
17 |
% |
|
(1) In July 2018, we contracted to operate and maintain a 20 MW
plant for Korea Southern Power Company (“KOSPO”). This contract was
originally represented in backlog as twenty years reflecting the
total term of the contract. Under the terms of the contract KOSPO
has a renewal option in year ten. Thus, under the adoption of
Accounting Standards Update (“ASU”) 2014-09, “Revenue from
Contracts with Customers,” which was implemented on November 1,
2018 service backlog was reduced by $64.3 million in 2018 and 2019
compared to amounts previously disclosed. Should KOSPO exercise
this option, service backlog will be adjusted accordingly. (2)
License backlog was not included prior to the adoption of
Accounting Standards Update (“ASU”) 2014-09, “Revenue from
Contracts with Customers,” which was implemented on November 1,
2018. |
Contract backlog increased to $1.32 billion as
of October 31, 2019, reflecting additional generation backlog from
the Bridgeport Fuel Cell, San Bernardino, and the LIPA Yaphank
Solid Waste Management projects, offset by the removal of the
Bolthouse Farms project and revenue recognized during the period.
Only projects for which we have a PPA are included in
generation backlog, which represents future revenue under long-term
PPAs. Service backlog decreased mainly as a result of the
acquisition of the Bridgeport Fuel Cell Project. Together, the
service and generation portion of backlog had an average weighted
term of approximately 18 years based on dollar backlog and utility
service contracts of up to 20 years in duration at inception.
Cash, Restricted Cash and Project
Finance
Cash, cash equivalents and restricted cash
totaled $39.8 million as of October 31, 2019, including $9.4
million of unrestricted cash and cash equivalents and $30.3 million
of restricted cash and equivalents.
On October 31, 2019, the Company entered an
8-year, $200 million senior secured credit facility with Orion
Energy Partners Investment Agent, LLC and certain of its affiliates
and drew down $14.5 million, followed by an additional $65.5
million draw down on November 22, 2019, primarily to support
execution of selected projects within the Company’s project
backlog. The balance of the facility, $120 million, is available
over the first 18 months following October 31, 2019, subject to the
approval of the lenders, to fund construction costs, inventory and
other capital expenditures of additional fuel cell projects
with contracted cash flows and inventory, working capital, and
other costs that may be required to be delivered by the Company on
purchase orders, service agreements, or other binding customer
agreements. In addition to providing corporate and project working
capital, proceeds from the two draws under this facility repaid
$22.8 million of short term debt.
Conference Call Information
FuelCell Energy will host a conference call
today beginning at 10:00 a.m. EST to discuss the fourth fiscal
quarter and full year results for fiscal 2019 along with details of
the Company’s new business strategy. Participants can access the
live call via webcast on the Company website or by telephone as
follows:
- The live webcast of the call and supporting slide presentation
will be available at www.fuelcellenergy.com. To listen to the call,
select “Investors” on the home page, proceed to the “Events &
Presentations” page and then click on the “Webcast” link listed
under the January 22nd earnings call event, or click here.
- Alternatively, participants can dial 647-689-4106 and state
FuelCell Energy or the conference ID number 5186075.
The replay of the conference call will be
available via webcast on the Company’s Investors’ page at
www.fuelcellenergy.com approximately two hours after the conclusion
of the call.
Cautionary Language
This news release contains forward-looking
statements within the meaning of the safe harbor provisions of the
Private Securities Litigation Reform Act of 1995, including,
without limitation, statements with respect to the Company’s
anticipated financial results and statements regarding the
Company’s plans and expectations regarding the continuing
development, commercialization and financing of its fuel cell
technology and its business plans and strategies. All
forward-looking statements are subject to risks and uncertainties
that could cause actual results to differ materially from those
projected. Factors that could cause such a difference include,
without limitation, changes to projected deliveries and order flow,
changes to production rate and product costs, general risks
associated with product development, manufacturing, changes in the
regulatory environment, customer strategies, ability to access
certain markets, unanticipated manufacturing issues that impact
power plant performance, changes in critical accounting policies,
access to and ability to raise capital and attract financing,
potential volatility of energy prices, rapid technological change,
competition, the Company’s ability to successfully implement its
new business strategies and achieve its goals, and the Company’s
ability to achieve its sales plans and cost reduction targets, as
well as other risks set forth in the Company’s filings with the
Securities and Exchange Commission. The forward-looking statements
contained herein speak only as of the date of this press release.
The Company expressly disclaims any obligation or undertaking to
release publicly any updates or revisions to any such statement to
reflect any change in the Company’s expectations or any change in
events, conditions or circumstances on which any such statement is
based.
About FuelCell Energy
FuelCell Energy, Inc. (NASDAQ: FCEL) is a global
leader in developing environmentally responsible distributed
baseload power solutions through our proprietary molten-carbonate
fuel cell technology. We develop turn-key distributed power
generation solutions and operate and provide comprehensive services
for the life of the power plant. We are working to expand the
proprietary technologies that we have developed over the past five
decades into new products, markets and geographies. Our mission and
purpose remains to utilize our proprietary, state-of-the-art fuel
cell power plants to reduce the global environmental footprint of
baseload power generation by providing environmentally responsible
solutions for reliable electrical power, hot water, steam,
chilling, hydrogen, microgrid applications, and carbon capture and,
in so doing, drive demand for our products and services, thus
realizing positive stockholder returns. Our fuel cell solution is a
clean, efficient alternative to traditional combustion-based power
generation and is complementary to an energy mix consisting of
intermittent sources of energy, such as solar and wind
turbines. Our systems answer the needs of diverse customers
across several markets, including utility companies,
municipalities, universities, hospitals, government entities and a
variety of industrial and commercial enterprises. We provide
solutions for various applications, including utility-scale
distributed generation, on-site power generation and combined heat
and power, with the differentiating ability to do so utilizing
multiple sources of fuel including natural gas, Renewable Biogas
(i.e., landfill gas, anaerobic digester gas), propane and various
blends of such fuels. Our multi-fuel source capability is
significantly enhanced by our proprietary gas-clean-up skid.
SureSource, SureSource 1500, SureSource 3000,
SureSource 4000, SureSource Recovery, SureSource Capture,
SureSource Hydrogen, SureSource Storage, SureSource Service,
SureSource Capital, FuelCell Energy, and FuelCell Energy logo are
all trademarks of FuelCell Energy, Inc.
Contact:
FuelCell Energy, Inc.ir@fce.com203.205.2491
Source: FuelCell Energy
|
FUELCELL ENERGY, INC.Consolidated Balance
Sheets(Unaudited)(Amounts in thousands, except
share and per share amounts) |
|
|
|
October 31,2019 |
|
|
October 31, 2018 |
ASSETS |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents, unrestricted |
$ |
9,434 |
|
|
$ |
39,291 |
|
Restricted cash and
cash equivalents – short-term |
|
3,473 |
|
|
|
5,806 |
|
Accounts receivable,
net |
|
3,292 |
|
|
|
9,280 |
|
Unbilled
receivables |
|
7,684 |
|
|
|
13,759 |
|
Inventories |
|
54,515 |
|
|
|
53,575 |
|
Other current
assets |
|
5,921 |
|
|
|
8,592 |
|
Total current assets |
|
84,319 |
|
|
|
130,303 |
|
|
|
|
|
|
|
Restricted cash and cash
equivalents – long-term |
|
26,871 |
|
|
|
35,142 |
|
Project assets |
|
144,115 |
|
|
|
99,600 |
|
Inventory – long-term |
|
2,179 |
|
|
|
- |
|
Property, plant and equipment,
net |
|
41,134 |
|
|
|
48,204 |
|
Goodwill |
|
4,075 |
|
|
|
4,075 |
|
Intangible assets |
|
21,264 |
|
|
|
9,592 |
|
Other assets |
|
9,489 |
|
|
|
13,505 |
|
Total assets |
$ |
333,446 |
|
|
$ |
340,421 |
|
|
|
|
|
|
|
LIABILITIES AND
EQUITY |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Current portion of
long-term debt |
$ |
21,916 |
|
|
$ |
17,596 |
|
Accounts payable |
|
16,943 |
|
|
|
22,594 |
|
Accrued
liabilities |
|
11,452 |
|
|
|
7,632 |
|
Deferred revenue |
|
11,471 |
|
|
|
11,347 |
|
Preferred stock obligation of subsidiary |
|
950 |
|
|
|
952 |
|
Total current liabilities |
|
62,732 |
|
|
|
60,121 |
|
|
|
|
|
|
|
Long-term deferred
revenue |
|
28,705 |
|
|
|
16,793 |
|
Long-term preferred stock
obligation of subsidiary |
|
16,275 |
|
|
|
14,965 |
|
Long-term debt and other
liabilities |
|
90,140 |
|
|
|
71,619 |
|
Total liabilities |
|
197,852 |
|
|
|
163,498 |
|
|
|
|
|
|
|
Redeemable Series B preferred
stock (liquidation preference of $64,020 at October 31, 2019 and
2018) |
|
59,857 |
|
|
|
59,857 |
|
Redeemable Series C preferred
stock (liquidation preference of $8,992 as of October 31,
2018) |
|
- |
|
|
|
7,480 |
|
Redeemable Series D preferred
stock (liquidation preference of $30,680 as of October 31,
2018) |
|
- |
|
|
|
27,392 |
|
Total Equity: |
|
|
|
|
|
Stockholders’
equity Common stock ($0.0001 par value;
225,000,000 shares authorized at October 31, 2019 and 2018;
193,608,684 and 7,972,686 shares issued and
outstanding at October 31, 2019 and 2018, respectively) |
|
19 |
|
|
|
1 |
|
Additional paid-in
capital |
|
1,151,454 |
|
|
|
1,073,463 |
|
Accumulated
deficit |
|
(1,075,089 |
) |
|
|
(990,867 |
) |
Accumulated other
comprehensive loss |
|
(647 |
) |
|
|
(403 |
) |
Treasury stock, Common,
at cost (42,496 and 13,042 at October 31, 2019 and 2018,
respectively) |
|
(466 |
) |
|
|
(363 |
) |
Deferred
compensation |
|
466 |
|
|
|
363 |
|
Total stockholders’ equity |
|
75,737 |
|
|
|
82,194 |
|
Total liabilities and stockholders’ equity |
$ |
333,446 |
|
|
$ |
340,421 |
|
|
FUELCELL ENERGY, INC.Consolidated Statements of
Operations(Unaudited)(Amounts in thousands, except share
and per share amounts) |
|
Three Months EndedOctober
31, |
|
2019 |
|
|
2018 |
|
Revenues: |
|
|
|
|
|
Product |
$ |
481 |
|
|
$ |
9,432 |
|
Service and
license |
|
752 |
|
|
|
2,898 |
|
Generation |
|
5,474 |
|
|
|
1,842 |
|
Advanced
Technologies |
|
4,334 |
|
|
|
3,712 |
|
Total revenues |
|
11,041 |
|
|
|
17,884 |
|
|
|
|
|
|
|
Costs of revenues: |
|
|
|
|
|
Product |
|
4,190 |
|
|
|
10,321 |
|
Service and
license |
|
3,777 |
|
|
|
3,125 |
|
Generation |
|
22,595 |
|
|
|
1,401 |
|
Advanced
Technologies |
|
3,868 |
|
|
|
1,894 |
|
Total cost of
revenues |
|
34,430 |
|
|
|
16,741 |
|
|
|
|
|
|
|
Gross (loss) profit |
|
(23,389 |
) |
|
|
1,143 |
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
Administrative and
selling expenses |
|
8,252 |
|
|
|
5,581 |
|
Research and
development expense |
|
1,351 |
|
|
|
7,432 |
|
Total costs and expenses |
|
9,603 |
|
|
|
13,013 |
|
|
|
|
|
|
|
Loss from operations |
|
(32,992 |
) |
|
|
(11,870 |
) |
|
|
|
|
|
|
Interest expense |
|
(2,816 |
) |
|
|
(2,421 |
) |
Other income, net |
|
649 |
|
|
|
200 |
|
|
|
|
|
|
|
Loss before provision for
income taxes |
|
(35,159 |
) |
|
|
(14,091 |
) |
|
|
|
|
|
|
Provision for income taxes |
|
(20 |
) |
|
|
(5 |
) |
|
|
|
|
|
|
Net loss |
|
(35,179 |
) |
|
|
(14,096 |
) |
|
|
|
|
|
|
Series B preferred
stock dividends |
|
(821 |
) |
|
|
(800 |
) |
Series C preferred
stock deemed dividends |
|
- |
|
|
|
(958 |
) |
Series D preferred
stock deemed dividends and redemption accretion |
|
(3 |
) |
|
|
(2,075 |
) |
|
|
|
|
|
|
Net loss attributable to
common stockholders |
$ |
(36,003 |
) |
|
$ |
(17,929 |
) |
|
|
|
|
|
|
Loss per share basic and
diluted: |
|
|
|
|
|
Net loss per share attributable to common stockholders |
$ |
(0.23 |
) |
|
$ |
(2.31 |
) |
Basic and diluted weighted average shares outstanding |
|
154,408,279 |
|
|
|
7,752,288 |
|
|
FUELCELL ENERGY, INC.Consolidated Statements of
Operations(Unaudited)(Amounts in thousands, except share
and per share amounts) |
|
Year EndedOctober 31, |
|
2019 |
|
|
2018 |
|
Revenues: |
|
|
|
|
|
Product |
$ |
481 |
|
|
$ |
52,490 |
|
Service and
license |
|
26,618 |
|
|
|
15,757 |
|
Generation |
|
14,034 |
|
|
|
7,171 |
|
Advanced
Technologies |
|
19,619 |
|
|
|
14,019 |
|
Total revenues |
|
60,752 |
|
|
|
89,437 |
|
|
|
|
|
|
|
Costs of revenues: |
|
|
|
|
|
Product |
|
18,552 |
|
|
|
54,504 |
|
Service and
license |
|
18,943 |
|
|
|
15,059 |
|
Generation |
|
31,642 |
|
|
|
6,421 |
|
Advanced
Technologies |
|
12,884 |
|
|
|
10,360 |
|
Total cost of
revenues |
|
82,021 |
|
|
|
86,344 |
|
|
|
|
|
|
|
Gross (loss) profit |
|
(21,269 |
) |
|
|
3,093 |
|
|
|
|
|
|
|
Operating expenses: |
|
|
|
|
|
Administrative and
selling expenses |
|
31,874 |
|
|
|
24,908 |
|
Research and
development expense |
|
13,786 |
|
|
|
22,817 |
|
Total costs and expenses |
|
45,660 |
|
|
|
47,725 |
|
|
|
|
|
|
|
Loss from operations |
|
(66,929 |
) |
|
|
(44,632 |
) |
|
|
|
|
|
|
Interest expense |
|
(10,623 |
) |
|
|
(9,055 |
) |
Other income, net |
|
93 |
|
|
|
3,338 |
|
|
|
|
|
|
|
Loss before (provision)
benefit for income taxes |
|
(77,459 |
) |
|
|
(50,349 |
) |
|
|
|
|
|
|
(Provision) benefit for income taxes |
|
(109 |
) |
|
|
3,015 |
|
|
|
|
|
|
|
Net loss |
|
(77,568 |
) |
|
|
(47,334 |
) |
|
|
|
|
|
|
Series A warrant
exchange |
|
(3,169 |
) |
|
|
- |
|
Series B preferred
stock dividends |
|
(3,231 |
) |
|
|
(3,200 |
) |
Series C preferred
stock deemed dividends and redemption value adjustment, net |
|
(6,522 |
) |
|
|
(9,559 |
) |
Series D preferred
stock deemed dividends and redemption accretion |
|
(9,755 |
) |
|
|
(2,075 |
) |
|
|
|
|
|
|
Net loss attributable to
common stockholders |
$ |
(100,245 |
) |
|
$ |
(62,168 |
) |
|
|
|
|
|
|
Loss per share basic and
diluted: |
|
|
|
|
|
Net loss per share attributable to common stockholders |
$ |
(1.82 |
) |
|
$ |
(9.01 |
) |
Basic and diluted weighted average shares outstanding |
|
55,081,266 |
|
|
|
6,896,189 |
|
Appendix
Further Detail on Statement of
Operations Accounting for the Series B Preferred Stock, Series C
Convertible Preferred Stock and the Series D Convertible Preferred
Stock:
Net loss attributable to common stockholders in
the fourth quarter of fiscal 2019 includes a dividend totaling $0.8
million on the Company’s 5% Series B Cumulative Convertible
Perpetual Preferred Stock (“Series B Preferred Stock”), and deemed
dividends totaling $0.003 million on the Company’s Series D
Convertible Preferred Stock. No dividends were declared
or paid by the Company on the Series B Preferred Stock in
connection with the August 15, 2019 dividend payment date (until
after the end of the fourth quarter of fiscal 2019). Because
such dividends were not paid on August 15, under the terms of the
Amended Certificate of Designation with respect to the Series B
Preferred Stock, the holders of shares of Series B Preferred
Stock were entitled to receive, when, as and if, declared by the
Board of Directors of the Company, dividends at a dividend rate per
annum equal to the normal dividend rate of 5%, plus an amount equal
to the number of dividend periods for which the Company failed to
pay or set apart funds to pay dividends multiplied by 0.0625%, for
each subsequent dividend period until the Company has paid or
provided for the payment of all dividends on the shares of Series B
Preferred Stock for all prior dividend periods.
Conversions of the Company’s Series C
Convertible Preferred Stock occurring during the year ended October
31, 2019 resulted in a variable number of shares being issued to
settle the conversion amounts and were treated as a partial
redemption of the Series C Convertible Preferred Stock. The Series
C Preferred Stock were fully converted during the three months
ended July 31, 2019.
Conversions of the Company’s Series D
Convertible Preferred Stock in which the conversion price was below
$16.56 (the conversion price of the Series D Convertible Preferred
Stock as of October 31, 2019 and during the three months and year
ended October 31, 2019) resulted in a variable number of shares
being issued to settle the conversion amounts and were treated as a
partial redemption of the Series D Convertible Preferred Stock. The
Series D Preferred Stock were fully converted during the three
months ended October 31, 2019.
Non-GAAP Financial Measures
Financial results are presented in accordance
with accounting principles generally accepted in the United States
(“GAAP”). Management also uses non-GAAP measures to analyze
and make operating decisions on the business. Earnings before
interest, taxes, depreciation and amortization (“EBITDA”) and
Adjusted EBITDA are alternate, non-GAAP measures of cash
utilization by the Company.
These supplemental non-GAAP measures are
provided to assist readers in determining operating performance.
Management believes EBITDA and Adjusted EBITDA are useful in
assessing performance and highlighting trends on an overall basis.
Management also believes these measures are used by companies in
the fuel cell sector and by securities analysts and investors when
comparing the results of the Company with those of other companies.
EBITDA differs from the most comparable GAAP measure, net loss
attributable to the Company, primarily because it does not include
finance expense, income taxes and depreciation of property, plant
and equipment and project assets. Adjusted EBITDA adjusts EBITDA
for stock-based compensation and restructuring charges, which are
considered either non-cash or non-recurring.
While management believes that these non-GAAP
financial measures provide useful supplemental information to
investors, there are limitations associated with the use of these
measures. The measures are not prepared in accordance with GAAP and
may not be directly comparable to similarly titled measures of
other companies due to potential differences in the exact method of
calculation. The Company’s non-GAAP financial measures are not
meant to be considered in isolation or as a substitute for
comparable GAAP financial measures, and should be read only in
conjunction with the Company’s consolidated financial statements
prepared in accordance with GAAP.
The following table calculates EBITDA and
Adjusted EBITDA and reconciles these figures to the GAAP financial
statement measure Net loss.
|
Three Months Ended October 31, |
|
Year Ended October 31, |
(Amounts in thousands) |
|
2019 |
|
|
|
2018 |
|
|
|
2019 |
|
|
|
|
2018 |
|
Net loss |
$ |
(35,179 |
) |
|
$ |
(14,096 |
) |
|
$ |
(77,568 |
) |
|
$ |
(47,334 |
) |
Depreciation |
|
4,034 |
|
|
|
2,123 |
|
|
|
12,353 |
|
|
|
8,648 |
|
Provision/(Benefit) for income
taxes |
|
20 |
|
|
|
5 |
|
|
|
109 |
|
|
|
(3,015 |
) |
Other income, net(1) |
|
(649 |
) |
|
|
(200 |
) |
|
|
(93 |
) |
|
|
(3,338 |
) |
Interest expense |
|
2,816 |
|
|
|
2,421 |
|
|
|
10,623 |
|
|
|
9,055 |
|
EBITDA |
$ |
(28,958 |
) |
|
$ |
(9,747 |
) |
|
$ |
(54,576 |
) |
|
$ |
(35,984 |
) |
Impairment expense |
|
17,520 |
|
|
|
- |
|
|
|
20,360 |
|
|
|
- |
|
Stock-based compensation
expense |
|
479 |
|
|
|
929 |
|
|
|
2,804 |
|
|
|
3,238 |
|
Adjusted EBITDA |
$ |
(10,959 |
) |
|
$ |
(8,818 |
) |
|
$ |
(31,412 |
) |
|
$ |
(32,746 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Other income, net includes gains and
losses from transactions denominated in foreign currencies, changes
in fair value of embedded derivatives, and other items incurred
periodically, which are not the result of the Company’s normal
business operations. |
|
|
|
Backlog
Backlog represents definitive agreements
executed by the Company and our customers. Projects for which the
Company has a PPA are included in generation backlog, which
represents future revenue under long-term PPAs. Projects sold to
customers (and not retained by the Company) are included in product
sales and service backlog and the related generation backlog is
removed upon the sale.
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