- $24.0M record first quarter
revenue, up 50% year-over-year
- Significantly strengthened balance sheet
- Although business continuity preserved during pandemic,
withdrawing 2020 revenue outlook due to COVID-19 uncertainties
VANCOUVER, May 5, 2020 /CNW/ - Ballard Power Systems
(NASDAQ: BLDP; TSX: BLDP) today announced consolidated financial
results for the first quarter ended March
31, 2020. All amounts are in U.S. dollars unless otherwise
noted and have been prepared in accordance with International
Financial Reporting Standards (IFRS).
"Our top priority, always, is the health and safety of
our people, customers and partners," said Randy MacEwen, President and CEO. "We have taken
important precautions to mitigate the impact of the COVID-19
pandemic on our people and our business. Notwithstanding this
extraordinary backdrop, we delivered record Q1 revenue of
$24.0 million, gross margin of 22%
and ending cash reserves of $181.6
million. We further fortified our balance sheet, with the
execution of an At-The-Market Equity Program."
Mr. MacEwen stated, "Although we are not seeing a pull-back in
long-term demand as a result of COVID-19, there are now some
uncertainties on the timelines for vehicle deployments by
end-customers. As a result, we believe it is prudent and
responsible for us to withdraw our 2020 revenue outlook at this
time."
Mr. MacEwen commented, "As we look past possible delays due to
near-term uncertainties, we believe the post-COVID-19 'new normal'
will offer opportunities to accelerate and further deepen our
market penetration. We expect increased calls globally to address
urban air quality, as recent studies have demonstrated a link
between long-term exposure to particulate matter below 2.5 microns,
or PM2.5, and COVID-19 mortality rates. We also expect the European
Green Deal, as well as infrastructure stimulus packages in key
markets, to promote the adoption of zero-emission mobility in a
green recovery. The new paradigm will also likely see increased
e-commerce, with a resultant increase in long-term demand for
zero-emission medium- and heavy-duty logistics trucks – a market
that has traditionally been difficult to decarbonize and a market
where we expect fuel cell electrification to be the zero-emission
powertrain of choice."
Mr. MacEwen further concluded, "The recent announcement by
Daimler Truck and Volvo Group to collaborate on sustainable
transportation by forming a joint venture for large-scale
production of fuel cells is yet another validation of our strategic
view of the market. We believe mass commercialization of fuel cell
electric vehicles will occur first in medium and heavy-duty motive
use cases – including bus, truck, train and marine – where there
are zero-emission requirements for heavy payload, long range and
rapid refueling. Many of these use cases feature return-to-base
duty cycles, where vehicles can be quickly refueled at a
centralized hydrogen refueling station, consistent with the current
user experience with legacy diesel. These use cases also
disproportionately contribute to emissions, including carbon
dioxide and PM2.5."
Q1 2020 Financial Highlights
(all comparisons are
to Q1 2019 unless otherwise noted)
- Total revenue was $24.0 million
in the quarter, a year-over-year increase of 50% or $8.0 million, primarily the result of higher
shipments of Heavy Duty Motive products, as well as higher
Technology Solutions revenue.
- The Power Products platform generated revenue of $12.3 million in the quarter, an increase of 95%
or $6.0 million:
-
- Heavy Duty Motive revenue was $10.4
million, an increase of 303% or $7.8
million, due primarily to higher shipments of module parts
kits and MEAs to China;
- Material Handling revenue was $0.7
million, a decrease of 78% or $2.5
million, primarily the result of lower fuel cell stack
shipments to Plug Power; and
- Backup Power revenue was $1.2
million, an increase of 181% or $0.8
million, due primarily to an increase in hydrogen-based fuel
cell stacks to Asia.
- The Technology Solutions platform generated revenue of
$11.6 million in the quarter, an
increase of 20% or $1.9 million, due
primarily to amounts earned from the Audi program and the
Weichai-Ballard joint venture (JV) technology transfer program,
which more than offset minor declines in other programs in the
period.
- Gross margin was 22% in Q1, an improvement of 8-points due
primarily to a shift toward a higher overall margin product and
service revenue mix.
- Cash operating costs2 were $12.2 million in the quarter, a 31% increase
primarily attributable to increased expenditure on technology and
product development expenses.
- Adjusted EBITDA2 was ($9.1)
million, compared to ($8.6)
million in Q1 2019, primarily as a result of higher equity
loss in the Weichai-Ballard JV.
- Net loss was ($13.5) million in
the quarter, an increase of 12% and adjusted net loss was
($13.5), an increase of 35%.
- Net loss per share2 was ($0.06), an increase of 11% and adjusted net loss
per share2 was ($0.06), an
increase of 33%.
- Cash used by operating activities was ($10.1) million, an improvement of 3%, reflecting
cash operating loss of ($7.0) million
and use in working capital of ($3.1)
million.
- Cash reserves were $181.6 million
at March 31, 2020, an increase of 10%
from the end of Q1 2019 and an increase of 33% from the end of the
prior quarter, reflecting net $52.6
million of cash raised in the quarter from partial execution
of an At-The-Market Equity Program. Ballard also made a further
capital contribution of $6.5 million
to the Weichai-Ballard JV in the quarter.
- During Q1 Ballard received $14.8
million in new orders and delivered orders valued at
$24.0 million, reducing the Order
Backlog by $9.2 million from the
prior quarter, ending Q1 at $169.5
million. The 12-month Order Book was $105.8 million at end-Q1, a decrease of
$4.5 million from the prior
quarter.
Q1 2020 Operating Highlights
- Issued a white paper with Deloitte
China titled "Fueling the Future of Mobility: Hydrogen
and fuel cell solutions for transportation" at the Consumer
Technology Association's CES 2020 trade show in Las Vegas, Nevada. The white paper includes
detailed total-cost-of-ownership analyses, concluding that it will
be less expensive to run Fuel Cell Electric Vehicles (FCEVs) than
battery electric vehicles (BEVs) or internal combustion engine
(ICE) vehicles in less than 10 years' time.
- Signed Equipment Sales Agreements for the provision of an
initial 500 FCgen®-1020ACS fuel cell stacks to adKor
GmbH and SFC Energy AG, to be integrated into Jupiter backup power
systems for deployment at radio tower sites in Germany through the end of 2021.
- Announced the Company's fuel cell technology and products had
successfully powered FCEVs in commercial Heavy- and Medium-Duty
Motive applications for an industry-leading cumulative total of
more than 30 million kilometers on roads around the globe.
- Announced a purchase order from Solaris Bus & Coach SA for
FCmoveTM-HD fuel cell modules to power 25 buses,
including 15 buses for deployment in Cologne and 10 buses for deployment in
Wuppertal, Germany under the JIVE2
funding program.
- Subsequent to the quarter, announced a follow-on purchase order
from Solaris Bus & Coach SA for FCmoveTM-HD fuel
cell modules to power 20 buses to be deployed in The Netherlands under the JIVE2 funding
program.
- Entered into an At-The-Market (ATM) Equity Distribution
Agreement and launched an ATM Program which added approximately net
$52.6 million to cash reserves in the
quarter, with an additional approximately net $12.3 million added in April. Together these
transactions increased Ballard's cash reserves by approximately net
$64.9 million.
Q1 2020 Financial Summary
|
|
(Millions of U.S.
dollars)
|
Three months ended
March 31,
|
|
2020
|
2019
|
% Change
|
REVENUE
|
|
|
|
Fuel Cell Products
& Services Revenue:1
|
|
|
|
Heavy Duty
Motive
|
10.4
|
2.6
|
303%
|
UAV
|
0.1
|
0.1
|
0%
|
Material
Handling
|
0.7
|
3.2
|
-78%
|
Backup
Power
|
1.2
|
0.4
|
181%
|
Sub-Total
|
$12.4
|
$6.3
|
95%
|
Technology
Solutions
|
11.6
|
9.7
|
20%
|
Total Fuel Cell
Products & Services
Revenue
|
$24.0
|
$16.0
|
50%
|
PROFITABILITY
|
|
|
|
Gross Margin
$
|
$5.2
|
$2.2
|
135%
|
Gross Margin
%
|
22%
|
14%
|
8-points
|
Operating
Expenses
|
$15.7
|
$10.7
|
46%
|
Cash Operating
Costs2
|
$12.2
|
$9.3
|
31%
|
Equity gain (loss) in
JV & Associates
|
($2.5)
|
($2.0)
|
26%
|
Adjusted
EBITDA2
|
($9.1)
|
($8.6)
|
-6%
|
Net Income
(Loss)
|
($13.5)
|
($12.0)
|
-12%
|
Earnings Per
Share
|
($0.06)
|
($0.05)
|
-11%
|
Adjusted Net
Loss2
|
($13.5)
|
($10.0)
|
-35%
|
Adjusted Net Loss per
share2
|
($0.06)
|
($0.04)
|
-33%
|
CASH
|
|
|
|
Cash Used by
Operating Activities:
|
|
|
|
Cash Operating Income
(Loss)
|
($7.0)
|
($6.0)
|
-17%
|
Working Capital
Changes
|
($3.1)
|
($4.5)
|
31%
|
Cash Used By Operating
Activities
|
($10.1)
|
($10.5)
|
3%
|
Cash
Reserves
|
$181.6
|
$165.0
|
10%
|
For a more detailed discussion of Ballard Power Systems' first
quarter 2020 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, May 6, 2020 at
8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review first quarter
2020 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. Ballard zero-emission PEM fuel cells are
enabling electrification of mobility, including buses, commercial
trucks, trains, marine vessels, passenger cars, forklift trucks and
UAVs. To learn more about Ballard, please visit
www.ballard.com.
Important Cautions Regarding Forward-Looking
Statements
This release contains forward-looking statements
concerning the impact of the coronavirus pandemic on our business
and on the long-term demand for fuel cell products, projected
product orders and sales and product shipments. 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), 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, acquisition
costs, the impact of unrealized gains or losses on foreign exchange
contracts, 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,
finance and other income, the impact of unrealized gains or losses
on foreign exchange contracts, 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.