FuelCell Energy, Inc. (Nasdaq: FCEL) -- a global leader in
decarbonizing power and producing hydrogen through our proprietary,
state-of-the-art fuel cell platforms to enable a world empowered by
clean energy -- today reported financial results and key business
highlights for its third quarter ended July 31, 2022.
“For the third quarter, we achieved our
strongest quarterly revenue in five years, reflecting product sales
and continued progress on our Powerhouse business strategy,” said
Mr. Jason Few, President and CEO. “We delivered Ex Works six
modules to Korea Fuel Cell Co., Ltd. during the quarter, and we
have completed manufacturing the eight modules needed to fulfill
the order placed by Korea Fuel Cell Co., Ltd. in June 2022 and
expect to deliver those modules Ex Works and recognize the
resulting revenue in the fourth quarter of fiscal year 2022. The
delivery of the six modules along with a 75% increase in revenues
from the Company’s Generation portfolio led to significantly
increased total revenues in the third fiscal quarter, compared to
the comparable prior-year quarter.”
“We are focused on continuing to improve our
execution of our project backlog and growing our generation
portfolio,” continued Mr. Few. “This year, we have strengthened our
project management team as well as invested in digitization tools
to enhance project management effectiveness. We continue to advance
our strategic agenda in terms of infrastructure, solutions, and
talent to support our medium- and long-term goals. These steps
include continued investment in both capability and capacity, which
are targeted to enhance our global commercial organization and
manufacturing capabilities as well as support our engineering focus
on commercializing our carbon capture, carbon separation and solid
oxide platforms.”
Mr. Few continued, “FuelCell Energy is in a
dynamic period of transition as we work to launch several new
solutions to support the accelerating energy transition. Earlier
this year, we highlighted the approximately $2 trillion in
combined, cumulative total addressable market opportunities through
2030 which we believe may be served by our commercially available
solutions and those that are actively under development by the
Company. Global policy support for clean energy continues to drive
our confidence in our target to deliver revenue of over $300
million by the end of fiscal year 2025 and revenue exceeding $1
billion by the end of fiscal year 2030.”
Mr. Few concluded, “We are excited to see the
expansive policy support package for clean energy and storage that
was recently enacted in the United States. We believe that the
Inflation Reduction Act is supportive of potential customers making
investments utilizing our solutions. We expect that the various
policy mechanisms within the Inflation Reduction Act will provide
businesses with the long-term market and tax certainty needed to
make important investment decisions, including in hiring,
manufacturing, and partnerships. With this legislation, users and
producers of fuel cell technology will be able to take advantage of
investment tax credits, production tax credits for clean power and
hydrogen, and carbon capture utilization and sequestration credits.
Together, we believe these are important incentives for building
and deploying more clean energy assets across the country, ensuring
the United States leverages its rich natural resources, and
decarbonizing our most challenging sectors without
deindustrialization. The investments FuelCell Energy is making in
our business are well aligned with these policy goals.”
Consolidated Financial Metrics
In this press release, FuelCell Energy refers to
various GAAP (U.S. generally accepted accounting principles) and
non-GAAP financial measures. The non-GAAP financial measures
may not be comparable to similarly titled measures being used and
disclosed by other companies. FuelCell Energy believes that
this non-GAAP information is useful to gaining an understanding of
its operating results and the ongoing performance of its business.
A reconciliation of EBITDA, Adjusted EBITDA and any other non-GAAP
measures is contained in the appendix to this press release.
|
Three Months Ended July 31, |
(Amounts in thousands) |
2022 |
|
2021 |
|
Change |
Total revenues |
$ |
43,104 |
|
|
$ |
26,820 |
|
|
$ |
16,284 |
|
Gross (loss) profit |
|
(4,180 |
) |
|
|
1,100 |
|
|
|
(5,280 |
) |
Loss from operations |
|
(27,997 |
) |
|
|
(10,585 |
) |
|
|
(17,412 |
) |
Net Loss |
|
(28,977 |
) |
|
|
(11,997 |
) |
|
|
(16,980 |
) |
Net loss attributable to common stockholders |
|
(30,214 |
) |
|
|
(12,797 |
) |
|
|
(17,417 |
) |
Net loss per share basic and diluted |
$ |
(0.08 |
) |
|
$ |
(0.04 |
) |
|
$ |
(0.04 |
) |
|
|
|
|
|
|
EBITDA |
|
(22,731 |
) |
|
|
(6,076 |
) |
|
|
(16,655 |
) |
Adjusted EBITDA |
$ |
(20,770 |
) |
|
$ |
(5,173 |
) |
|
$ |
(15,597 |
) |
Third Quarter of Fiscal 2022
Results
Note: All comparisons between periods are
between the third quarter of fiscal 2022 and the third quarter of
fiscal 2021, unless otherwise specified.
Third quarter revenues of $43.1 million
represents an increase of 61% from the comparable prior-year
quarter.
- Product revenues
were $18.0 million in the third quarter of fiscal 2022 (compared to
no product revenues in the comparable prior-year period). The
increase in product revenues was a result of module sales to Korea
Fuel Cell Co. (“KFC”) for which the Company recognized $18.0
million on the delivery Ex Works of six fuel cell modules from the
Company’s facility in Torrington, CT in June 2022.
- Service agreements
revenues decreased 37% to $9.0 million from $14.3 million. The
decrease in revenues for the third quarter of fiscal 2022 is
primarily due to the fact that there were fewer module exchanges
and fewer non-routine maintenance activities during the third
quarter of fiscal 2022 than during the third quarter of fiscal
2021.
- Generation
revenues increased 75% to $10.9 million from $6.2 million,
primarily due to the completion of the Long Island Power Authority
(“LIPA”) Yaphank project during the three months ended January 31,
2022, and the higher operating output of the generation fleet
portfolio as a result of module exchanges during the last nine
months of fiscal year 2021. Generation revenues for the third
quarter of fiscal 2022 also include sales of renewable energy
credits (which resulted in an increase in generation revenues of
approximately $1.7 million for the third quarter of fiscal
2022).
- Advanced
Technologies contract revenues decreased 17% to $5.2
million from $6.2 million. Compared to the third quarter of fiscal
2021, Advanced Technologies contract revenues recognized under the
Joint Development Agreement with ExxonMobil Technology and
Engineering Company f/k/a ExxonMobil Research
and Engineering Company (“EMTEC”) were approximately $3.1
million lower during the third quarter of fiscal 2022, offset by an
increase in revenue recognized under government contracts and other
contracts of $2.0 million for the third quarter of fiscal
2022.
Gross loss for the third quarter of fiscal 2022
totaled $(4.2) million, compared to a gross profit of $1.1 million
in the comparable prior-year quarter. The increase in gross
loss was driven by higher manufacturing variances, $6.9
million of non-capitalizable costs related to construction of the
Toyota project, and lower Advanced Technologies contract margin,
partially offset by reduced generation gross loss (excluding the
impact of non-capitalizable costs related to construction of the
Toyota project) and higher service gross profit.
Operating expenses for the third quarter of
fiscal 2022 increased to $23.8 million from $11.7 million in the
third quarter of fiscal 2021. Administrative and selling expenses
increased to $14.2 million from $8.7 million due to higher sales,
marketing and consulting costs, as the Company is investing in
rebranding and accelerating its sales and commercialization efforts
including increasing the size of its sales and marketing teams,
which resulted in an increase in compensation expense from an
increase in headcount. Research and development expenses of $9.7
million during the quarter, up from $3.0 million in the third
quarter of fiscal 2021, reflect increased spending on the Company’s
ongoing commercial development efforts related to our solid oxide
platform and carbon capture solutions compared to the comparable
prior year period.
Net loss was $(29.0) million in the third
quarter of fiscal 2022, compared to net loss of $(12.0) million in
the third quarter of fiscal 2021 driven primarily by a gross loss
(compared to a gross profit in the third quarter of fiscal 2021)
and higher operating expenses. Additionally, the provision for
income tax was higher in the third quarter of fiscal 2022 compared
to the third quarter of fiscal 2021.
Adjusted EBITDA totaled $(20.8) million in the
third quarter of fiscal 2022, compared to Adjusted EBITDA of $(5.2)
million in the third quarter of fiscal 2021. Please see the
discussion of non-GAAP financial measures, including Adjusted
EBITDA, in the appendix at the end of this release.
The net loss per share attributable to common
stockholders in the third quarter of fiscal 2022 was $(0.08),
compared to $(0.04) in the third quarter of fiscal 2021. The higher
net loss per common share is primarily due to the higher net loss
attributable to common stockholders, partially offset by the higher
number of weighted average shares outstanding due to share
issuances since July 31, 2021.
Cash, Restricted Cash and Financing
Update
Cash and cash equivalents and restricted cash
and restricted cash equivalents totaled $479.6 million as of July
31, 2022 compared to $460.2 million as of October 31, 2021.
- Unrestricted cash and cash equivalents totaled $456.5 million
compared to $432.2 million as of October 31, 2021.
- Restricted cash and cash equivalents were $23.2 million, of
which $5.6 million was classified as current and $17.5 million was
classified as non-current, compared to $28.0 million of restricted
cash and cash equivalents as of October 31, 2021, of which $11.3
million was classified as current and $16.7 million was classified
as non-current.
On July 12, 2022, the Company entered into an
Open Market Sale Agreement with Jefferies LLC, B. Riley Securities,
Inc., Barclays Capital Inc., BMO Capital Markets Corp., BofA
Securities, Inc., Canaccord Genuity LLC, Citigroup Global Markets
Inc., J.P. Morgan Securities LLC and Loop Capital Markets LLC (the
“Open Market Sale Agreement”) with respect to an at the market
offering program under which the Company may, from time to time,
offer and sell up to 95.0 million shares of the Company’s common
stock. During the quarter, the Company sold approximately 18.5
million shares under the Open Market Sale Agreement at an average
sale price of $3.63 per share. Of this 18.5 million shares,
approximately 7.8 million shares were issued and settled during the
period ended July 31, 2022, resulting in gross proceeds of
approximately $27.9 million before deducting sales commissions and
fees, and net proceeds to the Company of approximately $27.2
million after deducting commissions and fees totaling approximately
$0.7 million. The balance of approximately 10.7 million shares were
settled subsequent to July 31, 2022, resulting in gross proceeds
(before deducting sales commissions) of approximately $39.2
million, and net proceeds to the Company of approximately $38.4
million after deducting commissions totaling approximately $0.8
million.
Operations and Commercialization
Update
During the quarter, the Company continued to
make progress on projects for which we have executed power and/or
hydrogen purchase agreements, with updates regarding certain
current projects provided below.
Groton Sub Base. In July 2021,
the Company achieved mechanical completion, executed the
interconnect agreement, and commenced the process of commissioning
the 7.4 MW platform at the U.S. Navy Submarine Base in Groton, CT
(the “Groton Project”). On September 14, 2021, the Company
disclosed that the process of commissioning the Groton Project was
temporarily suspended due to a needed repair. Following the
completion of that repair, the Company resumed commissioning of the
Groton Project. During the resumed commissioning process, the
Company observed operating parameter data from one of the two fuel
cell platforms installed at the project site that indicated a
mechanical component was not performing according to engineered
specifications. The Company subsequently determined that component
should be removed from the project site to facilitate the necessary
repair and upgrade. On April 7, 2022, the Company announced that it
had completed the necessary repairs and upgrades to the mechanical
component, reinstalled the mechanical component at the project
site, and restarted the process of commissioning. During the
restarted commissioning process, the Company encountered
performance anomalies primarily in the mixer eductor oxidizer
(“MEO”) which is a sophisticated piece of equipment specific to the
Groton Project designed to optimize fuel and air flows. The Company
is considering operating the project at a reduced output of 3 MW
per platform at the start of commercial operations in order to
optimize performance of each of the two MEO units. Over a period of
approximately one year, the Company anticipates implementing
upgrades to each of the two MEO units in order to bring the
platform to its rated capacity of 7.4 MW. Under extensions
previously received from the U.S. Navy, the deadline by which
commercial operations are to be achieved is September 30, 2022. We
expect that the Groton Project could be commercially operational by
September 30, 2022 at a reduced power output of approximately 6 MW.
However, commencement of operations at a reduced output of
approximately 6 MW requires approval by the Connecticut Municipal
Electric Energy Cooperative (“CMEEC”) and the U.S. Navy. Although
the Company is in discussions with CMEEC and the U.S. Navy, no
assurance can be given that CMEEC and the U.S. Navy will provide
such approval.
This platform is expected to highlight the
ability of FuelCell Energy’s platforms to perform at high
efficiencies and provide low CO2 to MWh output. Incorporation of
the platform into a microgrid is expected to demonstrate the
capacity of FuelCell Energy’s platforms to increase grid stability
and resilience while supporting the U.S. military’s efforts to
fortify base energy supply and demonstrate the U.S. Navy’s
commitment to clean, reliable power with microgrid
capabilities.
Toyota – Port of Long Beach,
CA. This 2.3 MW trigeneration platform will produce
electricity, hydrogen and water. Fuel cell platform equipment has
been built and delivered to the site, civil construction work has
significantly advanced, and certain portions of the platform have
advanced to the conditioning phase of project deployment. We
continue to anticipate that the remaining construction and
commissioning activity will be completed in late calendar year 2022
or early calendar year 2023.
Derby, CT. On-site civil
construction of this 14.0 MW project continues to advance, the
Company has largely completed the foundational construction, and
balance of plant components have been delivered and installed on
site. This utility scale fuel cell platform will contain five
SureSource 3000 fuel cell systems that will be installed on
engineered platforms alongside the Housatonic River. To date, the
Company has invested approximately $26.2 million into the project,
with the majority of site work complete and the electrical and
mechanical balance of plant installed. The Company continues work
with the utility customer, United Illuminating, on the
interconnection process, the timing of which will drive the
continued development of the site, including the delivery of the
ten fuel cell modules required to complete the project.
Manufacturing Output, Capacity and
Expansion. For the three months ended July 31, 2022, we
operated at an annualized production rate of approximately 36.5 MW,
which is an increase from the annualized production rate of 35 MW
for the three months ended July 31, 2021. We are working to
increase our production rate during the remainder of fiscal year
2022 and are targeting achieving a rate capable of producing 40 to
45 MW on an annualized basis by the end of fiscal year 2022.
At this time, the maximum annualized capacity
(module manufacturing, final assembly, testing and conditioning) is
100 MW per year under the Torrington facility’s current
configuration when being fully utilized. The Torrington facility is
sized to accommodate the eventual annualized production capacity of
up to 200 MW per year with additional capital investment in
machinery, equipment, tooling, and inventory. We expect to continue
to make investments in the remainder of fiscal year 2022 in our
factories for molten carbonate and solid oxide production capacity
expansion; the addition of test facilities for new products and
components; the expansion of our laboratories; and upgrades to and
expansion of our business systems.
Commercialization
Update. The Company continues to advance its
solid oxide platform research, including increasing production of
solid oxide fuel cell modules and expanding manufacturing capacity.
The Company continues to work with Idaho National Laboratories on a
demonstration high-efficiency electrolysis platform. This project,
done in conjunction with the U.S. Department of Energy, is intended
to demonstrate that the Company’s platform can operate at higher
electrical efficiency than currently available electrolysis
technologies through the inclusion of an external heat source. To
further accelerate the commercialization activity for the solid
oxide platform, the Company recently commenced the design and
construction of two advanced prototypes targeted for fiscal year
2023 completion: (i) a 250 kW power generation platform, and (ii) a
1 MW high-efficiency electrolysis platform.
Backlog
|
|
|
As of July 31, |
|
|
|
(Amounts in thousands) |
|
2022 |
|
2021 |
|
Change |
|
Product |
|
$ |
38,312 |
|
$ |
- |
|
$ |
38,312 |
|
|
Service |
|
|
112,238 |
|
|
127,048 |
|
|
(14,810 |
) |
|
Generation |
|
|
1,103,396 |
|
|
1,109,343 |
|
|
(5,947 |
) |
|
License |
|
|
- |
|
|
22,182 |
|
|
(22,182 |
) |
|
Advanced Technologies |
|
|
30,217 |
|
|
40,027 |
|
|
(9,810 |
) |
|
Total Backlog |
|
$ |
1,284,163 |
|
$ |
1,298,600 |
|
$ |
(14,437 |
) |
Backlog decreased by approximately 1.1% to $1.28
billion as of July 31, 2022, compared to $1.30 billion as of July
31, 2021, primarily as a result of a reduction in Service and
Advanced Technologies contract backlog, offset by the addition of
product sales backlog (specifically, the addition of product sales
backlog from the module order received from KFC). Advanced
Technologies contract backlog primarily represents remaining
revenue under our Joint Development Agreement with EMTEC and
government projects. Note that in the first quarter of fiscal 2022,
approximately $22.2 million of backlog, which was previously
classified as “Service and license” backlog, was reclassified to
“Product” backlog as a result of the settlement agreement with
POSCO Energy and KFC.
Only projects for which we have an executed
power purchase agreement (“PPA”) or an executed Hydrogen Power
Purchase Agreement are included in generation backlog, which
represents future revenue under long-term agreements. Together, the
service and generation portion of backlog had a weighted average
term of approximately 18 years, with weighting based on the dollar
amount of backlog and utility service contracts of up to 20 years
in duration at inception.
Backlog represents definitive agreements
executed by the Company and our customers. 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.
Conference Call Information
FuelCell Energy will host a conference call
today beginning at 10:00 a.m. EDT to discuss third quarter results
for fiscal year 2022 as well as key business highlights.
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 September 8th
earnings call event, or click here.
- Alternatively, participants can
dial 646-960-0699 and state FuelCell Energy or the conference ID
number 1099808.
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 regarding future
events or our future financial performance that involve certain
contingencies and uncertainties, including those discussed in our
Annual Report on Form 10-K for the fiscal year ended October 31,
2021 in the section entitled "Management's Discussion and Analysis
of Financial Condition and Results of Operations”. The
forward-looking statements include, 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
current and future fuel cell technologies, the expected timing of
completion of the Company’s ongoing projects, the Company’s
business plans and strategies, the markets in which the Company
expects to operate, and the size and scope of its total addressable
market opportunities, which is an estimate based on currently
available public information and the application of management’s
current assumptions and business judgment. Projected and estimated
numbers contained herein are not forecasts and may not reflect
actual results. These forward-looking statements are not guarantees
of future performance, and 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: general risks
associated with product development and manufacturing; general
economic conditions; changes in interest rates, which may impact
project financing; supply chain disruptions; changes in the utility
regulatory environment; changes in the utility industry and the
markets for distributed generation, distributed hydrogen, and fuel
cell power plants configured for carbon capture or carbon
separation; potential volatility of commodity and energy prices
that may adversely affect our projects; availability of government
subsidies and economic incentives for alternative energy
technologies; our ability to remain in compliance with U.S. federal
and state and foreign government laws and regulations and the
listing rules of The Nasdaq Stock Market; rapid technological
change; competition; the risk that our bid awards will not convert
to contracts or that our contracts will not convert to revenue;
market acceptance of our products; changes in accounting policies
or practices adopted voluntarily or as required by accounting
principles generally accepted in the United States; factors
affecting our liquidity position and financial condition;
government appropriations; the ability of the government and third
parties to terminate their development contracts at any time; the
ability of the government to exercise “march-in” rights with
respect to certain of our patents; our ability to successfully
market and sell our products internationally; our ability to
implement our strategy; our ability to reduce our levelized cost of
energy and deliver on our cost reduction strategy generally; our
ability to protect our intellectual property; litigation and other
proceedings; the risk that commercialization of our products will
not occur when anticipated or, if it does, that we will not have
adequate capacity to satisfy demand; our need for and the
availability of additional financing; our ability to generate
positive cash flow from operations; our ability to service our
long-term debt; our ability to increase the output and longevity of
our platforms and to meet the performance requirements of our
contracts; our ability to expand our customer base and maintain
relationships with our largest customers and strategic business
allies; changes by the U.S. Small Business Administration or other
governmental authorities to, or with respect to the implementation
or interpretation of, the Coronavirus Aid, Relief, and Economic
Security Act, the Paycheck Protection Program or related
administrative matters; and concerns with, threats of, or the
consequences of, pandemics, contagious diseases or health
epidemics, including the novel coronavirus, and resulting supply
chain disruptions, shifts in clean energy demand, impacts to our
customers’ capital budgets and investment plans, impacts to our
project schedules, impacts to our ability to service existing
projects, and impacts on the demand for our products, as well as
other risks set forth in the Company’s filings with the Securities
and Exchange Commission, including the Company’s Annual Report on
Form 10-K for the fiscal year ended October 31, 2021. 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 contained or incorporated by
reference herein 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): FuelCell Energy is a
global leader in sustainable clean energy technologies that address
some of the world’s most critical challenges around energy, safety
and global urbanization. As a leading global manufacturer of
proprietary fuel cell technology platforms, FuelCell Energy is
uniquely positioned to serve customers worldwide with sustainable
products and solutions for businesses, utilities, governments and
municipalities.
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
EnergyFUELCELL ENERGY,
INC.Consolidated Balance
Sheets(Unaudited)(Amounts in thousands, except
share and per share amounts)
|
|
July 31,2022 |
|
|
October 31,2021 |
ASSETS |
|
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and cash equivalents, unrestricted |
$ |
456,479 |
|
|
$ |
432,213 |
|
Restricted cash and cash equivalents – short-term |
|
5,627 |
|
|
|
11,268 |
|
Accounts receivable, net |
|
12,101 |
|
|
|
14,730 |
|
Unbilled receivables |
|
10,461 |
|
|
|
8,924 |
|
Inventories |
|
80,606 |
|
|
|
67,074 |
|
Other current assets |
|
14,259 |
|
|
|
9,177 |
|
Total current assets |
|
579,533 |
|
|
|
543,386 |
|
|
|
|
|
|
|
Restricted cash and cash
equivalents – long-term |
|
17,532 |
|
|
|
16,731 |
|
Project assets, net |
|
246,018 |
|
|
|
223,277 |
|
Inventories – long-term |
|
4,586 |
|
|
|
4,586 |
|
Property, plant and equipment,
net |
|
52,868 |
|
|
|
39,416 |
|
Operating lease right-of-use
assets, net |
|
7,401 |
|
|
|
8,109 |
|
Goodwill |
|
4.075 |
|
|
|
4,075 |
|
Intangible assets, net |
|
17,697 |
|
|
|
18,670 |
|
Other assets |
|
14,712 |
|
|
|
16,998 |
|
Total assets(1) |
$ |
944,422 |
|
|
$ |
875,248 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current liabilities: |
|
|
|
|
|
Current portion of long-term debt |
$ |
9,810 |
|
|
$ |
10,085 |
|
Current portion of operating lease liabilities |
|
798 |
|
|
|
1,032 |
|
Accounts payable |
|
26,978 |
|
|
|
19,267 |
|
Accrued liabilities |
|
22,535 |
|
|
|
16,099 |
|
Deferred revenue |
|
20,393 |
|
|
|
6,287 |
|
Total current liabilities |
|
80,514 |
|
|
|
52,770 |
|
|
|
|
|
|
|
Long-term deferred revenue and
customer deposits |
|
14,342 |
|
|
|
30,427 |
|
Long-term operating lease
liabilities |
|
7,619 |
|
|
|
8,093 |
|
Long-term debt and other
liabilities |
|
82,280 |
|
|
|
78,633 |
|
Total liabilities(1) |
|
184,755 |
|
|
|
169,923 |
|
|
|
|
|
|
|
Redeemable Series B preferred
stock (liquidation preference of $64,020 as of July 31, 2022 and
October 31, 2021) |
|
59,857 |
|
|
|
59,857 |
|
Redeemable noncontrolling
interest |
|
3,030 |
|
|
|
3,030 |
|
Total equity: |
|
|
|
|
|
Stockholders’ equity: |
|
|
|
|
|
|
|
Common stock ($0.0001 par value); 500,000,000 shares authorized as
of July 31, 2022 and October 31, 2021; 394,430,969 and 366,618,693
shares issued and outstanding as of July 31, 2022 and October 31,
2021, respectively |
|
39 |
|
|
|
37 |
|
Additional paid-in capital |
|
2,056,626 |
|
|
|
1,908,471 |
|
Accumulated deficit |
|
(1,365,506 |
) |
|
|
(1,265,251 |
) |
Accumulated other comprehensive loss |
|
(1,145 |
) |
|
|
(819 |
) |
Treasury stock, Common, at cost (119,258 and 73,430 shares as of
July 31, 2022 and October 31, 2021, respectively) |
|
(786 |
) |
|
|
(586 |
) |
Deferred compensation |
|
786 |
|
|
|
586 |
|
Total stockholder’s equity |
|
690,014 |
|
|
|
642,438 |
|
Noncontrolling interest |
|
6,766 |
|
|
|
- |
|
Total equity |
|
696,780 |
|
|
|
642,438 |
|
Total liabilities, redeemable
noncontrolling interests and stockholders’ equity |
$ |
944,422 |
|
|
$ |
875,248 |
|
(1) |
The consolidated assets as of July 31, 2022 and October 31, 2021
include $105,641 and $54,375, respectively, of assets of the
variable interest entity (“VIE”) that can only be used to settle
obligations of the VIE. These assets include cash of $2,842,
unbilled accounts receivable of $1,067, operating lease right of
use assets of $1,186 and project assets of $100,546 as of July 31,
2022, and cash of $1,364 and project assets of $53,012 as of
October 31, 2021, respectively. The consolidated liabilities as of
July 31, 2022 include short-term operating lease liabilities of
$157, accrued liabilities of $500 and long-term operating lease
liability of $1,478. The consolidated liabilities as of October 31,
2021 were $0. |
FUELCELL ENERGY,
INC.Consolidated Statements of Operations and
Comprehensive Loss(Unaudited)(Amounts in
thousands, except share and per share amounts)
|
Three Months EndedJuly 31, |
|
2022 |
|
2021 |
Revenues: |
|
|
|
|
|
Product |
$ |
18,000 |
|
|
$ |
- |
|
Service |
|
9,049 |
|
|
|
14,344 |
|
Generation |
|
10,877 |
|
|
|
6,230 |
|
Advanced Technologies |
|
5,178 |
|
|
|
6,246 |
|
Total revenues |
|
43,104 |
|
|
|
26,820 |
|
Costs of revenues: |
|
|
|
|
|
Product |
|
17,919 |
|
|
|
1,903 |
|
Service |
|
7,718 |
|
|
|
13,026 |
|
Generation |
|
18,136 |
|
|
|
6,728 |
|
Advanced Technologies |
|
3,511 |
|
|
|
4,063 |
|
Total costs of revenues |
|
47,284 |
|
|
|
25,720 |
|
Gross (Loss) profit |
|
(4,180 |
) |
|
|
1,100 |
|
Operating expenses: |
|
|
|
|
|
Administrative and selling expenses |
|
14,158 |
|
|
|
8,662 |
|
Research and development expenses |
|
9,659 |
|
|
|
3,023 |
|
Total costs and expenses |
|
23,817 |
|
|
|
11,685 |
|
Loss from operations |
|
(27,997 |
) |
|
|
(10,585 |
) |
Interest expense |
|
(1,622 |
) |
|
|
(1,554 |
) |
Other income, net |
|
1,136 |
|
|
|
149 |
|
Loss before provision for income
taxes |
|
(28,483 |
) |
|
|
(11,990 |
) |
Provision for income taxes |
|
(494 |
) |
|
|
(7 |
) |
Net loss |
|
(28,977 |
) |
|
|
(11,997 |
) |
Net income attributable to noncontrolling interest |
|
437 |
|
|
|
- |
|
Net loss attributable to FuelCell
Energy, Inc. |
|
(29,414 |
) |
|
|
(11,997 |
) |
Series B preferred stock dividends |
|
(800 |
) |
|
|
(800 |
) |
Net loss attributable to common
stockholders |
$ |
(30,214 |
) |
|
$ |
(12,797 |
) |
Loss per share basic and
diluted: |
|
|
|
|
|
Net loss per share attributable to common stockholders |
$ |
(0.08 |
) |
|
$ |
(0.04 |
) |
Basic and diluted weighted average shares outstanding |
|
387,465,758 |
|
|
|
337,291,562 |
|
FUELCELL ENERGY,
INC.Consolidated Statements of Operations and
Comprehensive Loss(Unaudited)(Amounts in
thousands, except share and per share amounts)
|
Nine Months Ended July 31, |
|
2022 |
|
2021 |
Revenues: |
|
|
|
|
|
Product |
$ |
36,000 |
|
|
$ |
- |
|
Service |
|
13,855 |
|
|
|
19,917 |
|
Generation |
|
27,423 |
|
|
|
17,306 |
|
Advanced Technologies |
|
14.005 |
|
|
|
18,427 |
|
Total revenues |
|
91,283 |
|
|
|
55,650 |
|
Costs of revenues: |
|
|
|
|
|
Product |
|
39,159 |
|
|
|
6,190 |
|
Service |
|
13,123 |
|
|
|
20,992 |
|
Generation |
|
42,978 |
|
|
|
23,265 |
|
Advanced Technologies |
|
10,408 |
|
|
|
12,477 |
|
Total costs of revenues |
|
105,668 |
|
|
|
62,924 |
|
Gross loss |
|
(14,385 |
) |
|
|
(7,274 |
) |
Operating expenses: |
|
|
|
|
|
Administrative and selling expenses |
|
64,357 |
|
|
|
27,264 |
|
Research and development expenses |
|
22,316 |
|
|
|
7,810 |
|
Total costs and expenses |
|
86,673 |
|
|
|
35,074 |
|
Loss from operations |
|
(101,058 |
) |
|
|
(42,348 |
) |
Interest expense |
|
(4,757 |
) |
|
|
(5,662 |
) |
Loss on extinguishment of debt |
|
- |
|
|
|
(11,156 |
) |
Loss on extinguishment of Series 1 preferred share obligation |
|
- |
|
|
|
(934 |
) |
Change in fair value of common stock warrant liability |
|
- |
|
|
|
(15,974 |
) |
Other income (expense), net |
|
1,086 |
|
|
|
(797 |
) |
Loss before provision for income
taxes |
|
(104,729 |
) |
|
|
(76,871 |
) |
Provision for income taxes |
|
(494 |
) |
|
|
(3 |
) |
Net loss |
|
(105,223 |
) |
|
|
(76,874 |
) |
Net loss attributable to noncontrolling interest |
|
(4,968 |
) |
|
|
- |
|
Net loss attributable to FuelCell
Energy, Inc. |
|
(100,255 |
) |
|
|
(76,874 |
) |
Series B preferred stock dividends |
|
(2,400 |
) |
|
|
(2,400 |
) |
Net loss attributable to common
stockholders |
$ |
(102,655 |
) |
|
$ |
(79,274 |
) |
Loss per share basic and
diluted: |
|
|
|
|
|
Net loss per share attributable to common stockholders |
$ |
(0.27 |
) |
|
$ |
(0.24 |
) |
Basic and diluted weighted average shares outstanding |
|
375,638,293 |
|
|
|
323,983,465 |
|
Appendix
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 non-GAAP measures of operations and operating
performance by the Company.
These supplemental non-GAAP measures are
provided to assist readers in assessing 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, restructuring charges and other
unusual items such as the non-recurring legal expense related to
the settlement of the POSCO Energy legal proceedings recorded
during the first quarter of fiscal 2022, 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 July 31, |
|
Nine Months Ended July 31, |
(Amounts in thousands) |
2022 |
|
2021 |
|
2022 |
|
2021 |
Net loss |
$ |
(28,977 |
) |
|
$ |
(11,997 |
) |
|
$ |
(105,223 |
) |
|
$ |
(76,874 |
) |
Depreciation and
amortization(1) |
|
5,266 |
|
|
|
4,509 |
|
|
|
16,369 |
|
|
|
14,921 |
|
Provision for income taxes |
|
494 |
|
|
|
7 |
|
|
|
494 |
|
|
|
3 |
|
Other (income)/expense,
net(2) |
|
(1,136 |
) |
|
|
(149 |
) |
|
|
(1,086 |
) |
|
|
797 |
|
Loss on extinguishment of
debt |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
11,156 |
|
Loss on extinguishment of Series
1 preferred share obligation |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
934 |
|
Change in fair value of common
stock warrant liability |
|
- |
|
|
|
- |
|
|
|
- |
|
|
|
15,974 |
|
Interest expense |
|
1,622 |
|
|
|
1,554 |
|
|
|
4,757 |
|
|
|
5,662 |
|
EBITDA |
$ |
(22,731 |
) |
|
$ |
(6,076 |
) |
|
$ |
(84,689 |
) |
|
$ |
(27,427 |
) |
Stock-based compensation
expense |
|
1,961 |
|
|
|
903 |
|
|
|
5,126 |
|
|
|
3,573 |
|
Legal fees incurred for a legal
settlement(3) |
|
- |
|
|
|
- |
|
|
|
24,000 |
|
|
|
- |
|
Adjusted EBITDA |
$ |
(20,770 |
) |
|
$ |
(5,173 |
) |
|
$ |
(55,563 |
) |
|
$ |
(23,854 |
) |
(1) |
Includes depreciation and amortization on our Generation portfolio
of $4.1 million and $11.8 million for the three and nine months
ended July 31, 2022, respectively, and $3.3 million and $11.2
million for the three and nine months ended July 31, 2021,
respectively. |
(2) |
Other (income)/expense, net includes gains and losses from
transactions denominated in foreign currencies, changes in fair
value of derivatives, and other items incurred periodically, which
are not the result of the Company’s normal business
operations. |
(3) |
The Company recorded legal fees of $24 million related to a legal
settlement during the nine months ended July 31, 2022, which was
recorded as an administrative and selling expense. |
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