Plug Power Inc. (NASDAQ: PLUG), a leading provider
of turnkey hydrogen solutions building the global green
hydrogen economy, announced today that it will restate its
previously issued financial statements for fiscal years 2018 and
2019 and its quarterly filings for 2019 and 2020, which will be
disclosed in the Form 10-K for the year ended December 31, 2020
(the “Prior Period Financial Statements”).
In consultation with KPMG LLP, the Company's
independent registered public accounting firm, management and
the Audit Committee of Plug Power’s Board of
Directors determined that the Company’s Prior Period
Financial Statements need to be restated due to errors in
accounting primarily related to several non-cash items,
including:
- The reported book value of right of use assets and related
finance obligations;
- Loss accruals for certain service contracts;
- The impairment of certain
long-lived assets; and
- The classification of certain costs, resulting in a decrease
in research and development expense and a corresponding
increase in cost of revenue.
The accounting related to the restatement is complex and
technical and involves significant judgments in how to apply U.S.
GAAP, given the innovative nature of the Company’s business and
its leading position in a new and rapidly developing
industry. The revised accounting will change how the Company
accounts for certain transactions and items, but is not
expected to impact the Company’s cash position, business
operations or economics of commercial arrangements. The
Company continues to expect to achieve its previously stated gross
billings targets of $475 million in 2021, $750 million in 2022 and
$1.7 billion in 2024.
Andy Marsh, CEO of Plug Power, said, “Since our founding
nearly 25 years ago, Plug Power has prided itself on operating with
transparency and integrity, and we
are working to resolve this matter
quickly. Importantly, there is no expected impact
to our cash position, business operations or economics of
commercial arrangements. We continue to execute on our
mission to provide customers with state-of-the-art fuel
cell and green hydrogen solutions. We
remain confident in our ability
to leverage our strong business momentum and market
leading technologies, independently and alongside our joint venture
partners, to capture the significant business opportunities in this
rapidly growing industry.”
As part of the Company’s normal process, prior to
releasing its 2020 fourth quarter and year
end preliminary results and prior to completion of the
audit, on February 24, 2021, the Company and the Audit
Committee discussed those results with KPMG, and at that time,
no material issues were raised. However, after the
Company reported its 2020 fourth quarter and year end
results, and in the course of finalizing the audit, the
Company and KPMG identified the restatement items cited above.
The Company has since reevaluated its accounting and
determined that it needed to correct the previous
accounting for those items.
It is important to note that the changes being
recorded did not result from any override of controls or
misconduct, and KPMG has not informed the Audit Committee
of any issues related to an override of controls or
misconduct.
The Company will not be able to file its Form 10-K
for 2020 by the March 16, 2021 deadline and is
working diligently to finalize the restated
financials and file its Form 10-K as soon
as possible. As disclosed in the Company’s Current Report on
Form 8-K filed today with the SEC, the Prior Period Financial
Statements should no longer be relied upon and the fourth quarter
and full year 2020 financial results and related discussion in the
Company’s shareholder letter issued on February 25, 2021 should no
longer be relied upon.
About Plug Power
Plug Power is building the hydrogen economy as the leading
provider of comprehensive hydrogen fuel cell turnkey solutions. The
Company’s innovative technology powers electric motors with
hydrogen fuel cells amid an ongoing paradigm shift in the power,
energy, and transportation industries to address climate change and
energy security, while meeting sustainability goals. Plug Power
created the first commercially viable market for hydrogen fuel cell
technology. As a result, the Company has deployed over 40,000 fuel
cell systems for e-mobility, more than anyone else in the world,
and has become the largest buyer of liquid hydrogen, having built
and operated a hydrogen highway across North America. Plug Power
delivers a significant value proposition to end-customers,
including meaningful environmental benefits, efficiency gains, fast
fueling, and lower operational costs. Plug Power’s
vertically-integrated GenKey solution ties together all critical
elements to power, fuel, and provide service to customers such as
Amazon, BMW, The Southern Company, Carrefour, and Walmart. The
Company is now leveraging its know-how, modular product
architecture and foundational customers to rapidly expand into
other key markets including zero-emission on-road vehicles,
robotics, and data centers. Learn more at www.plugpower.com.
Forward-Looking Statements
This press release contains forward-looking statements within
the meaning of the federal securities laws. These statements
include, but are not limited to, statements regarding the Company’s
expectations regarding future gross billings, the nature and extent
of the accounting changes and errors and the expected impact of the
accounting changes and the restatement on the Company’s prior and
future financial statements, financial position and results of
operation. These forward-looking statements are made as of the date
hereof and are based on current expectations, estimates, forecasts
and projections as well as the beliefs and assumptions of
management. Forward-looking statements are subject to a number of
risks and uncertainties, many of which involve factors or
circumstances that are beyond the Company’s control. The Company’s
actual results could differ materially from those stated or implied
in forward-looking statements due to a number of factors,
including, but not limited to, the risk that additional information
may arise prior to the filing of the restated financial statements;
the final determination of the Audit Committee regarding matters
relating to its internal review; the timing and ultimate
conclusions of KPMG regarding the audit of the Company’s financial
statements, and the risk that the completion and filing of the
Company’s annual report on Form 10-K will take longer than
expected. These and other potential risks and uncertainties that
could cause actual results to differ from the results predicted are
more fully detailed in the Company’s filings and reports with the
SEC, including the Annual Report on Form 10-K for the year ended
December 31, 2019, as amended and supplemented by the Quarterly
Reports on Form 10-Q for the quarters ended March 31, 2020, June
30, 2020 and September 30, 2020, as well as other filings and
reports that are filed by the Company from time to time with the
SEC. The Company disclaims any obligation to update forward-looking
statements.
Gross billings is based on the invoice value of equipment
deployed in the period. To that amount, the Company adds the
invoice value for services rendered in the period, fuel provided to
customers, power provided under Power Purchase agreements, etc.
Invoice value of equipment and service is measured on a relative
basis using cash value within contracts with customers. The
Company’s objective in presenting gross billings is to present to
investors an operating metric that conveys commercial growth over
time. Management also uses this operating metric as a measurement
of commercial growth, as well as establishing performance targets
and annual budgets, and makes operating decisions based in part on
gross billings. The significant estimates and assumptions
underlying the metric include the allocation of revenue, excluding
the provision for warrants, based on relative stand along selling
prices used in our GAAP revenue numbers.
Media Contact Andrea Rose / Clayton ErwinJoele
Frank, Wilkinson Brimmer Katcher212-895-8666 /
212-895-8696arose@joelefrank.com / cerwin@joelefrank.com
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