VANCOUVER, March 3 /PRNewswire-FirstCall/ -- Ballard Power Systems
(TSX: BLD; NASDAQ: BLDP) announced its financial results for the
fourth quarter and full-year ended December 31, 2008 today. All
amounts are in U.S. dollars, unless otherwise stated. "Ballard had
a strong fourth quarter and solid financial results for the full
year," said John Sheridan, President and CEO. "We grew revenues 17%
on a pro forma basis, reduced operating cash consumption by 23% and
ended the year with $85.4 million in cash reserves. As a result, we
believe we are well positioned to execute our growth plan, although
the challenges are heightened by the macro-economic conditions."
FOURTH QUARTER 2008 HIGHLIGHTS ------------------------------ -
Shipments were 802 fuel cell products, representing growth of 140%
from the same quarter in 2007. - Revenue was $18.9 million, a
decrease of 6% from the prior year's quarter. On a pro forma basis
adjusting for automotive engineering development, revenue increased
61%. - Operating cash consumption(1) was $8.5 million, a 31%
decline from Q4 2007. - A high volume supply agreement with ACME
was announced on October 21, 2008, with units to be deployed
primarily for telecom backup power applications in India, subject
to product acceptance in Q4. - The Notice to Proceed was received
for delivery of 20 fuel cell buses for B.C. Transit's 2010 Olympic
fuel cell bus fleet. - A non-dilutive financing transaction with
Superior Plus Income Fund closed on December 31, 2008 with net
proceeds of $34 million. FULL YEAR 2008 HIGHLIGHTS
------------------------- - Shipments were 1,855 fuel cell
products, exceeding guidance. - Revenue met revised guidance at
$59.6 million, a decrease of 9% from 2007. On a pro forma basis,
revenue grew 17% over the prior year. - Operating cash
consumption(1) met guidance at $29.3 million, down 23% from 2007. -
Operating expenses, excluding depreciation and amortization,
declined $29.3 million, to $57.2 million. - Net income was $34.1
million, or $0.40 per share. - Normalized net loss1 was $60.0
million or ($0.71) per share, representing a $7.7 million increase
from 2007 driven by decreases in foreign exchange gains and
investment income, totaling $18.6 million. - Cash reserves of $85.4
million.
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Three months Full year ended Dec. 31, ended Dec. 31, 2008 2007 %
Change 2008 2007 % Change
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Total Product Shipments 802 334 140% 1,855 1,035 79%
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Key Markets: Material Handling 254 81 214% 508 204 149% Backup
Power 357 101 252% 720 200 260% Res. Cogeneration 96 111 -14% 403
445 -9%
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FULL YEAR 2008 FINANCIAL RESULTS --------------------------------
In 2008, revenues were $59.6 million, representing a 9% decline
from $65.5 million in 2007 and meeting the revised guidance range
of $58 to $64 million. However, adjusting for light-duty automotive
engineering development revenue of $1.6 million in 2008 and $15.8
million in 2007, which relates to the business sold to AFCC, pro
forma revenues increased $8.2 million, or 17%, compared to 2007.
Product and service revenues totaled $52.7 million, an increase of
$9.4 million, or 22% compared with 2007. An $8.8 million increase
in product revenues to $38.2 million was driven by higher shipments
of bus, material handling, light-duty automotive and backup power
fuel cell products, partially offset by lower shipments of
residential cogeneration and material products. The decline in
residential cogeneration product sales was expected due to the
introduction in 2008 of a new lower cost product combined with the
delivery of fuel cell membrane electrode assemblies instead of fuel
cell stacks, as the fuel cell stacks are now assembled in Japan by
Ballard's joint venture, EBARA BALLARD. The decline in carbon fiber
products was due to the effects of a labor strike that affected a
key customer in the first half of 2008 and the unprecedented
weakness in the U.S. automotive industry. Service revenues
increased $0.5 million due to new testing and engineering services
provided to AFCC, partially offset by a decline in field service
for fuel cell buses. Engineering development revenue totaled $6.9
million, a decline of $15.3 million from 2007 primarily due to the
elimination of automotive fuel cell program work subsequent to the
closing of the automotive transaction on January 31, 2008. Lower
gross margins were driven by larger reductions in warranty
provisions for 2007 compared to 2008, more aggressive product
pricing and enhanced warranty coverage on material handling
products in order to encourage market adoption, declines in field
service revenues for fuel cell buses, declines in service revenue
and higher program expenditures on Power Generation non-recurring
engineering government contracts, and lower volumes of carbon fiber
products due to the effects of a labor strike affecting a key
customer and the slow down in the U.S. automotive industry. These
declines were only partially offset by increased margins as a
result of new testing and engineering services provided to AFCC and
the commencement of shipments of fuel cell bus modules related to
the B.C. Transit 2010 Olympic fuel cell bus project. Operating
expenses declined $29.3 million, primarily due to lower research
and development expenses on automotive fuel cell programs as a
result of the automotive transaction. Net income increased to $34.1
million, or $0.40 per share, compared to a net loss of $57.3
million, or ($0.50) per share, in 2007. Net income for 2008
included a gain on sale of assets of $96.8 million resulting from
the automotive transaction, partially offset by the write-down of a
non-core investment of $3.0 million. Normalized net loss(1)
increased to $60.0 million, or ($0.71) per share, representing a
$7.7 million increase compared with $52.2 million or ($0.46) per
share in 2007. This increase in normalized net loss is primarily a
result of non-operating items, including decreases in foreign
exchange gains of $12.4 million and decreases in investment income
of $6.2 million. Decreases in product and service gross margins and
engineering development revenues were more than offset by decreases
in operating expenses and depreciation and amortization. Operating
cash consumption(1) for 2008 decreased 23% to $29.3 million,
compared to $38.2 million for 2007, meeting our guidance range of
$20 million to $30 million. This $8.9 million improvement was
driven primarily by lower working capital requirements, lower
operating expenses and lower capital expenditures partially offset
by lower foreign exchange gains of $12.4 million, a decline in
investment income of $6.2 million and lower product and service
gross margins and engineering development revenues. For a more
detailed discussion of Ballard Power Systems' fourth quarter and
full-year 2008 results, please see the company's financial
statements and management's discussion & analysis, which are
available at http://www.ballard.com/, http://www.sedar.com/ and
http://www.sec.gov/edgar.shtml. Selected Consolidated Financial
Information: Fourth Quarter & Full Year 2008 Unaudited
(Expressed in thousands of U.S. dollars, except for per share
amount and number of shares)
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Three months ended December 31, Year ended December 31, 2008 2007
2008 2007
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Revenues: Product and service revenue $ 18,605 $ 10,591 $ 52,726 $
43,352 Engineering development revenue 296 9,474 6,854 22,180
--------------------------------------------------- Total revenues
18,901 20,065 59,580 65,532 Cost of revenues and expenses: Cost of
product and service revenues 16,887 6,430 47,401 25,052 Research
and product development 7,957 15,467 37,172 58,478 General and
administrative 2,506 8,379 12,615 19,068 Marketing and business
development 1,877 2,588 7,461 8,981 Depreciation and amortization
1,556 4,595 6,034 15,732
--------------------------------------------------- Total cost of
revenues and expenses 30,783 37,459 110,683 127,311
--------------------------------------------------- Loss before
undernoted (11,882) (17,394) (51,103) (61,779) Investment and other
income (loss) (2,410) 2,628 186 16,933 Loss on disposal &
write-down of long-lived assets (2,794) - (2,812) (4,583) Gain on
sales of assets - - 96,845 - Equity in loss of associated companies
(942) (1,125) (8,649) (7,433)
--------------------------------------------------- Income (loss)
from continuing operations before income taxes (18,028) (15,891)
34,095 (56,862) Income taxes - - 16 (53)
--------------------------------------------------- Income (loss)
from continuing operations for period (18,028) (15,891) 34,079
(56,809) Loss from discontinued operations for period - - - (493)
--------------------------------------------------- Net income
(loss) for period $ (18,028) $ (15,891) $ 34,079 $ (57,302)
---------------------------------------------------
--------------------------------------------------- Basic earnings
(loss) per share $ (0.22) $ (0.14) $ 0.40 $ (0.50) Diluted earnings
(loss) per share $ (0.22) $ (0.14) $ 0.40 $ (0.50)
--------------------------------------------------- Weighted
average number of common shares outstanding-basic 82,116,349
114,742,491 84,922,364 114,575,473
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Cash used by operations $ (7,536) $ (9,795) $ (26,209) $ (31,850)
Capital expenditures (994) (2,583) (3,085) (6,379)
--------------------------------------------------- Operating cash
consumption (End note 1) $ (8,530) $ (12,378) $ (29,294) $ (38,229)
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December 31, December 31, 2008 2007
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Total cash, cash equivalents and short term investments $ 85,399 $
145,574
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Conference Call Ballard will hold a conference call to discuss its
2008 financial results on Wednesday, March 4, 2009 at 8:00 a.m. PST
(11:00 a.m. EST). The live call can be accessed by calling
+1-604-638-5340. The live audio webcast can be accessed through a
link on Ballard's homepage (http://www.ballard.com/). Following the
call, an audio recording will be available for approximately 24
hours and can be accessed at +1-604-638-9010 using confirmation
number 6325#. The audio webcast with slides will also be archived
in the Investor Events & Conference Calls section of Ballard's
website for approximately 90 days. About Ballard Power Systems
Ballard Power Systems (TSX: BLD; NASDAQ: BLDP) is recognized as a
world leader in the design, development, manufacture and sale of
clean energy fuel cell products. Ballard's mission is to accelerate
fuel cell product adoption. To learn more about what Ballard is
doing with Power to Change the World(R), visit
http://www.ballard.com/. This release contains forward-looking
statements, including estimated future revenue and operating cash
consumption contained in our outlook, which are provided to enable
external stakeholders to understand our expectations as at the date
of this release and may not be appropriate for other purposes.
These forward-looking statements are based on the beliefs and
assumptions of Ballard's management and 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. Such assumptions relate to Ballard's
financial forecasts and expectations regarding its product
development efforts, manufacturing capacity, and market demand, and
include matters such as generating new sales, producing, delivering
and selling the expected number of units, and controlling its
costs. These statements involve risks and uncertainties that may
cause Ballard's actual results to be materially different,
including, without limitation, the rate of mass adoption of its
products, product development delays, changing environmental
regulations, its ability to attract and retain business partners
and customers, its access to funding, increased competition, its
ability to protect its intellectual property, changes in its
customers' requirements, foreign exchange impacts on its net
monetary assets and its ability to provide the capital required for
product development, operations and marketing. For a detailed
discussion of these risk factors and other risk factors that could
affect Ballard's future performance, please refer to Ballard's most
recent Annual Information Form. Readers should not place undue
reliance on Ballard's forward-looking statements and Ballard
assumes no obligation to update or release any revisions to these
forward looking statements, other than as required under applicable
legislation.
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Endnote: -------- (1) Operating cash consumption and normalized net
loss are non-GAAP measures used to assist in assessing Ballard's
financial performance. Non-GAAP measures do not have any
standardized meaning prescribed by GAAP and are therefore unlikely
to be comparable to similar measures presented by other companies.
Operating cash consumption measures the amount of cash required to
fund the operating activities of Ballard's business and excludes
financing and investing activities except for net additions to
property, plant and equipment. Normalized net loss measures our net
loss after excluding items that are unusual in nature or do not
reflect the normal continued operating activity of the business.
Gains on sale of assets held for sale, losses from discontinued
operations and write-downs of long-lived assets are not considered
part of our core activities, and are expected to occur
infrequently. Therefore we have removed these in our calculation of
normalized net loss. Ballard, the Ballard logo and Power to Change
the World are registered trademarks of Ballard Power Systems Inc.
DATASOURCE: Ballard Power Systems Inc. CONTACT: or to arrange an
interview with a Ballard spokesperson, please contact Amy Harada
Bradley at telephone number (604) 412-7913 or on e-mail
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