- 50% Revenue Growth, 35% Gross Margin and positive Adjusted
EBITDA of $1.1M, with $68.1M ending Cash Reserves
VANCOUVER, Aug. 2, 2017 /PRNewswire/ - Ballard Power
Systems (NASDAQ: BLDP; TSX: BLDP) today announced consolidated
financial results for the second quarter ended June 30, 2017. All amounts are in U.S. dollars
unless otherwise noted and have been prepared in accordance with
International Financial Reporting Standards (IFRS).
"In Q2 we grew revenue 50% year-on-year to $26.5 million, increased gross margin 6-points to
35%, and generated positive Adjusted EBTIDA of $1.1 million," said Randy
MacEwen, President and CEO. "Through the first half of 2017,
revenue increased 45% to $49.2
million, gross margin increased to 38%, and Adjusted EBITDA
was positive $0.4 million. In fact,
Adjusted EBITDA was positive $0.6
million for the trailing 12-month period. With a strong
order book and robust sales pipeline, we are well positioned to
deliver a solid second half of the year."
Mr. MacEwen continued, "We are seeing growing global market
interest in fuel cell electric vehicles, or FCEVs, across a number
of Heavy Duty Motive applications and use cases, including buses,
trucks and rail applications, where standalone battery solutions
are challenged to address the market requirements."
China is poised to lead the
adoption of FCEVs and Ballard
continued to focus on execution of its China strategy during Q2:
- Together with partner Guangdong Synergy Hydrogen Power
Technology Co., Ltd., Ballard made
significant progress toward the establishment of a fuel cell stack
manufacturing joint venture in Yunfu, which remains on track to be
operational later in 2017;
- Ballard's strategic
partnership with Zhongshan Broad-Ocean Motor Co., Ltd. progressed
through signing of a follow-on $18
million equipment supply agreement to support the expected
deployment of 400 fuel cell modules in FCEVs, with substantial
deliveries expected in 2017; and
- Ballard shipped five of its
200 kilowatt (kW) modules to CSR Sifang, which are expected to be
used in the world's first fuel cell-powered trams in the City of
Foshan starting in 2018.
Mr. MacEwen concluded, "Our PEM fuel cell leadership, our
strategic positioning, a financial trend toward positive Adjusted
EBITDA and a fully-funded business plan positions Ballard uniquely within the industry."
Q2 2017 Financial Highlights
(all comparisons are
to Q2 2016 unless otherwise noted)
- Revenue was $26.5 million, an
increase of 50%, reflecting growth in both Power Products and
Technology Solutions.
- The Power Products platform generated revenue of $15.2 million, an increase of 29%:
-
- Heavy Duty Motive revenue was $12.2
million, an increase of 157% resulting primarily from
product shipments to fulfill orders in support of planned
deployments of fuel cell electric vehicles in China;
- The Portable Power business is significantly behind the
Company's plan in 2017, primarily due to lower product shipments
resulting from continued delay in the achievement of Milestone C in
the U.S. Army Program of Record. Portable Power revenue was
$0.9 million in Q2, a decline of
69%;
- Material Handling revenue was $2.0
million, a decline of 21% primarily due to a lower average
selling price resulting from a shift in product mix;
and
- Telecom Backup Power revenue was $0.1
million, a decrease of $1.5
million following divestiture of the Company's methanol
Telecom Backup Power business assets in May
2016.
- The Technology Solutions platform generated revenue of
$11.3 million, an increase of 93%
primarily reflecting increased work on our stack joint venture, bus
and tram programs in China.
- Gross margin was 35%, an improvement of 6-points primarily due
to a favorable shift in product mix toward higher margin Technology
Solutions and Heavy Duty Motive revenue, combined with improved
manufacturing overhead and related cost absorption resulting from
higher production volumes.
- Cash operating costs2 were $8.5 million, an increase of 1%.
- Adjusted EBITDA2 was $1.1
million in Q2, an improvement of $4.0
million or 136% primarily driven by higher revenue and
higher gross margin.
- Net loss was ($1.2) million, an
improvement of $4.6 million or
79%.
- Net loss per share was ($0.01),
an improvement from ($0.04).
- Adjusted net loss2 was ($0.4)
million, an improvement of $5.1
million or 93%.
- Adjusted net loss per share2 was ($0.00) per share, an improvement from
($0.03).
- Cash provided by operating activities was $1.8 million, an improvement of 146% reflecting
cash operating income of $1.4 million
and a working capital change of $0.4
million.
- Cash reserves were $68.1 million
at June 30, an increase of 65% from
the end of Q2 2016.
Q2 2017 Sales and Operations Highlights
- Entered into a contract in June, valued at approximately
$18 million, with Zhongshan
Broad-Ocean Motor Co., Ltd. ("Broad-Ocean") for the supply and
delivery of 400 FCveloCity® fuel cell engines expected
to be used in demonstrations of fuel cell electric buses and trucks
in key Chinese cities. This announcement, together with an
$11 million transaction announced in
April for 200 FCveloCity® engines, means that
Ballard is planning to support
Broad-Ocean through the expected deployment of 600 fuel cell
engines having a value of $29
million, with significant deliveries expected to be made in
2017.
- Shipped five 200kW FCveloCity® fuel cell engines to
CRRC Qingdao Sifang Company ("CSR Sifang") to power trams that are
expected to be deployed on the Gaoming Line in the City of Foshan,
China starting in 2018. To date 6
of 10 fuel cell engines have been shipped to CSR Sifang.
- Announced that an FCveloCity® fuel cell engine will
power a hybrid class 8 drayage truck built by Kenworth Truck
Company to haul shipping containers from the ports of Los Angeles and Long
Beach to area warehouses and intermodal facilities during a
two-year demonstration program.
- Received an initial order for Protonex' fuel cell propulsion
system, together with design services, from FlyH2 Aerospace in
South Africa for use in powering
its UA Plant prototype unmanned aerial vehicle (UAV or
drone). FlyH2 Aerospace plans to deploy Protonex systems in all
three of its drone models, which are currently in the development
pipeline and planned for use in commercial applications. Protonex
is a Ballard subsidiary.
- Subsequent to quarter end, received an order from SunLine
Transit Agency for five FCveloCity® fuel cell engines to
power fuel cell electric buses in Palm
Desert, California. Ballard
is partnering with ElDorado National and BAE Systems to deliver the
fuel cell buses, powered by Ballard's 150kW engines, which are expected to
be shipped in 2017.
Q2 2017 Corporate Platform Highlights
- In alignment with the company's board renewal process, Ms.
Janet Woodruff joined the board of
directors on April 1.
- Rob Campbell joined the
executive leadership team as Vice President and Chief Commercial
Officer on May 1.
- Awarded a special "GreenTech 2017" prize in Berlin, Germany for powering Europe's largest fuel cell bus fleet in
Aberdeen, Scotland. Ten fuel cell
buses, powered by Ballard 150kW
FCveloCity® fuel cell engines, have been providing
zero-emission transportation throughout Aberdeen since 2014.
Q2 2017 Financial Summary
|
|
|
(Millions of U.S.
dollars)
|
Three months
ended June 30,
|
Six months ended
June 30,
|
|
2017
|
2016
|
% Change
|
2017
|
2016
|
% Change
|
GROWTH
|
|
|
|
|
|
|
Fuel Cell Products
& Services Revenue:1
|
|
|
|
|
|
|
|
Heavy Duty
Motive
|
$12.2
|
$4.7
|
157%
|
$19.4
|
$8.0
|
142%
|
|
Portable
Power
|
$0.9
|
$2.9
|
-69%
|
$2.1
|
$5.4
|
-62%
|
|
Material
Handling
|
$2.0
|
$2.5
|
-21%
|
$4.2
|
$6.6
|
-36%
|
|
Backup
Power
|
$0.1
|
$1.6
|
-93%
|
$0.7
|
$1.9
|
-66%
|
|
Sub-Total
|
$15.2
|
$11.8
|
29%
|
$26.3
|
22.0
|
20%
|
|
Technology
Solutions
|
$11.3
|
$5.9
|
93%
|
$22.9
|
$11.9
|
91%
|
Total Fuel Cell
Products & Services Revenue
|
$26.5
|
$17.6
|
50%
|
$49.2
|
$34.0
|
45%
|
PROFITABILITY
|
|
|
|
|
|
|
Gross Margin
$
|
$9.3
|
$5.1
|
81%
|
$18.8
|
$8.4
|
124%
|
Gross Margin
%
|
35%
|
29%
|
6-points
|
38%
|
25%
|
13-points
|
Operating
Expenses
|
$10.2
|
$10.1
|
1%
|
$22.2
|
$23.1
|
-4%
|
Cash Operating
Costs2
|
$8.5
|
$8.4
|
1%
|
$18.4
|
$17.8
|
4%
|
Adjusted
EBITDA2
|
$1.1
|
($2.9)
|
136%
|
$0.4
|
($10.1)
|
104%
|
Net Income
(Loss)
|
($1.2)
|
($5.8)
|
79%
|
($4.1)
|
($15.8)
|
74%
|
Earnings Per
Share
|
($0.01)
|
($0.04)
|
81%
|
($0.02)
|
($0.10)
|
77%
|
Adjusted Net Income
(Loss)2
|
($0.4)
|
($5.4)
|
93%
|
($3.3)
|
($14.2)
|
77%
|
Adjusted Net Loss Per
Share2
|
($0.00)
|
($0.03)
|
94%
|
($0.02)
|
($0.09)
|
79%
|
CASH
|
|
|
|
|
|
|
Cash Provided (Used)
by Operating Activities:
|
|
|
|
|
|
|
|
Cash Operating Income
(Loss)
|
$1.4
|
($3.7)
|
138%
|
$0.2
|
($11.1)
|
102%
|
|
Working Capital
Changes
|
$0.4
|
($0.2)
|
268%
|
($1.5)
|
($0.3)
|
-442%
|
|
Cash Provided (Used)
By Operating Activities
|
$1.8
|
($3.9)
|
146%
|
($1.3)
|
($11.4)
|
89%
|
Cash
Reserves
|
$68.1
|
$41.3
|
65%
|
|
|
|
For a more detailed discussion of Ballard Power Systems' second
quarter 2017 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
Thursday, August 3, 2017 at
8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review its second
quarter 2017 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 'Investor Presentations and Events' area of
the 'Investors' section of Ballard's website
(www.ballard.com/investors).
About Ballard Power Systems
Ballard Power Systems
(NASDAQ: BLDP; TSX: BLDP) provides clean energy products that
reduce customer costs and risks, and helps customers solve
difficult technical and business challenges in their fuel cell
programs. To learn more about Ballard, please visit www.ballard.com.
Important Cautions Regarding Forward-Looking
Statements
This release contains forward-looking statements
concerning projected revenue growth, product shipments, gross
margin, Adjusted EBITDA, cash operating expenses and product sales.
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.
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 fuel cell products for our
power product markets of Heavy Duty Motive (consisting of bus,
commercial truck and tram applications), Portable Power, 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 and financing charges. EBITDA measures net loss attributable
to Ballard Power Systems Inc. excluding finance expense, income
taxes, depreciation of property, plant and equipment, amortization
of intangible assets, and goodwill impairment charges. Adjusted
EBITDA adjusts EBITDA for stock based compensation expense,
transactional gains and losses, asset impairment charges, finance
and other income, and acquisition costs. Adjusted Net Income (Loss)
measures net income (loss) attributable to Ballard from continuing
operations, excluding transactional gains and losses, asset
impairment charges, and acquisition costs.
|
SOURCE Ballard Power Systems Inc.