VANCOUVER, BC, Aug. 10,
2022 /PRNewswire/ - Ballard Power Systems
(NASDAQ: BLDP) (TSX: BLDP) today announced consolidated financial
results for the second quarter ended June
30, 2022. All amounts are in U.S. dollars unless otherwise
noted and have been prepared in accordance with International
Financial Reporting Standards (IFRS).
"We continue to see policy momentum across the globe to support
our vision of decreasing our planet's emissions. We believe our
product offering will make a meaningful impact on the energy
transition by enabling our customers with zero emission solutions.
This vision is at the forefront of our continued innovation and
investment in our business and product offering", said Mr.
Randy MacEwen, President and
CEO.
Mr. MacEwen remarked, "In the second quarter, our revenue was
$20.9 million, and we secured new
orders totaling $12.3 million, driven
primarily by stationary power generation and repeat bus customers.
We saw continued gross margin compression in the quarter and
anticipate continued pressure throughout 2022, but we are confident
in our plan to expand margins in the mid- to long-term as we
transition to commercial scale production. We ended the quarter
with a strong cash balance of $1
billion, which continues to support our technology
development programs and other strategic growth initiatives."
"We are encouraged by our continued progress with platform
customers as they advance commercialization of zero-emissions fuel
cell solutions in a variety of attractive applications and markets.
The European bus market is an example of the growing scale of
fuel-cell solutions, with public transport operators in
Cologne, Germany and West Midlands, UK announcing plans to deploy
additional hydrogen fuel cell bus fleets of 100 and over 120,
respectively."
"Given the challenging macro-economic outlook, we have decreased
our planned investments in 2022. As a result, we are revising our
total operating expense and capital expenditure guidance downwards
from $140 to $160 million to $130 to $150
million, and $40 to
$60 million to $30 to $50 million, respectively," Mr.
MacEwen stated. "Notwithstanding the current macro-economic
context, we remain confident on the long-term opportunities for
hydrogen and fuel cells. We see converging trends driving the
energy transition, including net-zero ambitions, low-cost renewable
energy, and energy security. At Ballard, we are well positioned
with leading fuel cell technology, strong customer and partner
relationships, and a solid balance sheet."
Q2 2022 Financial
Highlights
(all comparisons are to Q2 2021 unless otherwise
noted)
- Total revenue was $20.9 million
in the quarter, down 16% year-over-year.
-
- Power Products revenue of $13.5
million decreased 14%, driven by lower shipments of fuel
cell products.
-
- Heavy-Duty revenues of $10.7
million decreased by a nominal amount.
- Stationary Power Generation revenues of $2.0 million decreased 28% as a result of lower
sales of stationary power generation fuel cell modules, stacks,
products and service revenues.
- Material Handling revenues of $0.8
million decreased 58%, primarily as a result of lower
shipments to Plug Power.
- Technology Solutions revenue of $7.4
million decreased 20% due primarily to decreased amounts
earned on the Weichai Ballard JV and Audi programs.
- Gross margin was (11)% in the quarter, a decrease of 26-points,
driven by a combination of a shift to lower overall product margin
and service revenue mix including the impacts of pricing strategy,
higher fixed overhead costs, higher warranty provisions and
adjustments, increase in supply costs, and inventory
adjustments.
- Total Operating Expenses and Cash Operating Costs3
were $38.5 million and $32.1 million in the quarter, respectively,
an increase of 58% and 59%, respectively. Increases were driven
primarily by higher expenditure on research, technology and product
development activities. Costs were also higher as a result of
increased general and administrative expenses.
- Adjusted EBITDA3 was ($35.0)
million, compared to ($19.7)
million in Q2 2021, primarily a result of the decrease in
gross margin and increase in Cash Operating Costs.
- Ballard received approximately $12.3
million of new orders in Q2, and delivered orders valued at
$20.9 million, resulting in an Order
Backlog of approximately $91.2
million at end-Q2.
- The 12-month Order Book was $61.4
million at end-Q2, a decrease of $4.3
million from the end of Q1 2022.
Order Backlog
($M)
|
Order Backlog
at End-Q1 2022
|
Orders Received
in Q2 2022
|
Orders Delivered
in Q2 2022
|
Order Backlog
at End-Q2 2022
|
Total Fuel Cell
Products & Services
|
$99.8
|
$12.3
|
$20.9
|
$91.2
|
2022 Outlook
Ballard is revising its 2022 Total Operating Expense4
and Capital Expenditure5 guidance downwards as
follows:
2022
|
Previous
Guidance
|
Revised
Guidance
|
Total Operating
Expense4
|
$140 - $160
million
|
$130 - $150
million
|
Capital
Expenditure5
|
$40 - $60
million
|
$30 - $50
million
|
Q2 2022 Financial
Summary
(Millions of U.S.
dollars,
except per share amounts)
|
Three months
ended June 30,
|
|
2022
|
2021
|
% Change
|
REVENUE
|
|
|
|
Fuel Cell Products
& Services:1,2
|
|
|
|
Heavy Duty
Motive
|
$10.7
|
$11.0
|
(3) %
|
Material
Handling
|
$0.8
|
$2.0
|
(58) %
|
Stationary Power
Generation
|
$2.0
|
$2.8
|
(28) %
|
Sub-Total
|
$13.5
|
$15.8
|
(14) %
|
Technology
Solutions
|
$7.4
|
$9.1
|
(20) %
|
Total Fuel Cell
Products & Services Revenue
|
$20.9
|
$25.0
|
(16) %
|
PROFITABILITY
Gross Margin
$
|
|
|
|
($2.2)
|
$3.8
|
(158) %
|
Gross Margin
%
|
(11) %
|
15 %
|
(26) pts
|
Total Operating
Expenses
|
$38.5
|
$24.4
|
58 %
|
Cash Operating
Costs3
|
$32.1
|
$20.1
|
59 %
|
Equity (loss) in JV
& Associates
|
($1.6)
|
($4.2)
|
62 %
|
Adjusted
EBITDA3
|
($35.0)
|
($19.7)
|
(78) %
|
Net (Loss) from
continuing operations
|
($55.8)
|
($21.9)
|
(155) %
|
Earnings Per
Share
|
($0.19)
|
($0.07)
|
(171) %
|
CASH
|
|
|
|
Cash provided by (used
in) Operating Activities:
|
|
|
|
Cash Operating
(Loss)
|
($34.3)
|
($14.2)
|
(142) %
|
Working Capital
Changes
|
($4.7)
|
($5.4)
|
14 %
|
Cash provided by (used
in) Operating Activities
|
($39.0)
|
($19.6)
|
(99) %
|
Cash
Reserves
|
$1,004.6
|
$1,246.8
|
(19) %
|
For a more detailed discussion of Ballard Power Systems' second
quarter 2022 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 Wednesday, August 10, 2022 at 8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review second quarter
2022 operating results. The live call can be accessed by dialing
+1.604.638.5340. Alternatively, a live audio and 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. Ballard
zero-emission PEM fuel cells are enabling electrification of
mobility, including buses, commercial trucks, trains, marine
vessels, and stationary power. To learn more about Ballard, please
visit www.ballard.com.
Important Cautions Regarding
Forward-Looking Statements
This release contains forward-looking statements concerning the
hydrogen economy and markets for our products and the effects of
governmental regulations on such markets, expected revenues,
operating expenses, capital expenditures, corporate development
activities, impacts of investments in manufacturing and R&D
capabilities and market growth, and our carbon emissions goals.
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), Material Handling and Stationary
Power Generation, 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 The
UAV market has been classified as a discontinued operation in our
third quarter of 2020 consolidated condensed financial statements.
As such, the assets of the UAV market have been classified as
assets held for sale as of September 30, 2020. Furthermore, the
historic operating results of the UAV market for 2020 have been
removed from continuing operating results and are instead presented
separately in the statement of comprehensive income as income from
discontinued operations.
|
3 Note that
Cash Operating Costs, EBITDA, and Adjusted EBITDA 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, and Adjusted EBITDA 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, and Adjusted EBITDA
to the Consolidated Financial Statements, please refer to the
tables below.
|
Cash Operating Costs
measures operating expenses excluding stock-based compensation
expense, depreciation and amortization, impairment losses or
recoveries on trade receivables, restructuring charges, acquisition
related costs, the impact of unrealized gains or losses on foreign
exchange contracts, and financing charges. EBITDA measures net loss
from continuing operations 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, finance and other income, the impact of
unrealized gains or losses on foreign exchange contracts, and
acquisition related costs.
|
4 Total
Operating Expenses refer to the measure reported in accordance with
IFRS.
|
5 Capital Expenditure is defined as
Additions to property, plant and equipment and
Investment in other intangible assets as disclosed in the
Consolidated Statements of Cash Flows
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended June
30,
|
Cash Operating
Costs
|
2022
|
2021
|
$
Change
|
Total Operating
Expenses
|
$
38,461
|
$
24,399
|
$
14,062
|
|
Stock-based
compensation expense
|
(2,780)
|
(2,535)
|
(245)
|
|
Impairment (losses) on
trade receivables
|
-
|
(49)
|
49
|
|
Acquisition related
costs
|
(372)
|
-
|
(372)
|
|
Restructuring
(charges)
|
(67)
|
(33)
|
(34)
|
|
Impact of unrealized
(losses) on foreign
exchange contracts
|
(678)
|
(224)
|
(454)
|
|
Depreciation and
amortization
|
(2,491)
|
(1,434)
|
(1,057)
|
|
Cash Operating
Costs
|
$
32,073
|
$
20,124
|
$
11,949
|
|
|
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended June
30,
|
EBITDA and Adjusted
EBITDA
|
2022
|
2021
|
$
Change
|
Net loss from
continuing operations
|
$
(55,791)
|
$
(21,913)
|
$
(33,878)
|
Depreciation and
amortization
|
3,441
|
2,444
|
997
|
Finance
expense
|
308
|
330
|
(22)
|
Income taxes
|
88
|
3
|
85
|
EBITDA
|
$
(51,954)
|
$
(19,136)
|
$
(32,818)
|
Stock-based
compensation expense
|
2,780
|
2,535
|
245
|
Acquisition related
costs
|
372
|
-
|
372
|
Finance and other
(income) loss
|
13,123
|
(3,276)
|
16,399
|
Impact of unrealized
losses on foreign exchange contracts
|
678
|
224
|
454
|
Adjusted
EBITDA
|
$
(35,001)
|
$
(19,653)
|
$
(15,348)
|
|
|
|
|
|
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SOURCE Ballard Power Systems Inc.