HYDG Hydrogen Corp (MM)

HydroGen Corporation (Nasdaq: HYDG), a designer and manufacturer of multi-megawatt air-cooled phosphoric acid fuel cell (PAFC) systems, today announced its financial results for the year ended December 31, 2006. HydroGen Corporation is currently in the development stage and is expected to remain so for at least the next several quarters. Recent Operational Highlights HydroGen Corporation moves to The Nasdaq Capital Market. Following approval by Nasdaq, the stock of HydroGen Corporation began trading under the symbol "HYDG" on The Nasdaq Capital Market on Tuesday, March 6. HydroGen Corporation achieved the mechanical completion and initiation of pre-commissioning activities at its full-scale 400 kW PAFC Module Demonstration and Acceptance Test Facility. This test facility will be utilized for demonstration and acceptance testing of 400 kW fuel cell modules manufactured in HydroGen's Versailles, Pennsylvania manufacturing plant. The 400 kW Module Test Facility will be followed by HydroGen's 400 kW full-scale commercial demonstration power plant, currently under construction at ASHTA Chemicals Inc.'s chlor-alkali manufacturing plant in Ashtabula, Ohio. HydroGen Corporation appointed Mr. Alan Hladis as Manager of Advanced Manufacturing. HydroGen Corporation appointed three new members to its Board of Directors. Mr. Brian T. McGee, Mr. Michael E. Basham and Mr. Philip J. Kranenburg, CPA, joined the Board as directors and members of the company�s Audit Committee, expanding HydroGen's Board to eight members. HydroGen Corporation achieves the completion of its Versailles, Pennsylvania, pressurized test facility and the successful operation of its 2.5 kW PAFC fuel cell stack at full rated capacity. �In the past year, we made definitive progress in our mission to become the first fully profitable manufacturer of stationary fuel cells for power generation,� said Dr. Leo Blomen, Chairman and Chief Executive Officer of HydroGen Corporation. �We firmly believe that HydroGen is uniquely positioned to become a leading player in the growing distributed generation market for electricity and in the movement towards clean, hydrogen-based power generation. In 2006, our first full year as a public company, we achieved numerous significant financial and operational milestones. With the ramp up of our manufacturing facility to full capacity, initiation of our 2.5 kW Fuel Stack Test Facility, total staffing of the organization, and more recently with the mechanical completion of our full-scale 400 kW Module Test Facility and strong progress in the construction of our full-scale commercial demonstration plant at ASHTA Chemicals Inc.�s chlor-alkali plant, we are well on our way to providing complete demonstration of our technology and organizational capabilities to our growing pipeline of potential customers ? paving the way for commercialization of our product.� Joshua Tosteson, President of HydroGen Corporation, added: �Global awareness and demand for alternative clean energy sources continues to generate tremendous market opportunities for our innovative technology. The convergence of numerous drivers, including increasingly stringent environmental standards, market preference for clean generation, growth in state alternative energy portfolio standards, inadequacy of the power grid, and numerous state and federal incentives supporting adoption of clean distributed generation, positions HydroGen Corporation well for commercial applications that demand cost-effective on-site power generation with zero emissions. Over the past year we implemented our operational and strategic growth plan, and are also making headway in our plans for development and construction of an advanced manufacturing facility with an initial production capacity of 25 MW per year, which will later be expanded to 100 MW per year capacity. Finally, we are particularly proud of the recent approval by Nasdaq to list our shares on The Nasdaq Capital Market, a move that will enhance our visibility within the financial community and facilitate the further creation of shareholder value.� Fiscal 2006 Year-End Financial Results For the year ended December 31, 2006, HydroGen�s net loss was $7.42 million, or $(0.67) per basic and diluted share, based on the weighted average of 11,060,986 common shares outstanding. This compares with a net loss of $5.74 million, or $(2.18) per basic and diluted share for the year ended December 31, 2005, based on the weighted average of 2,631,633 common shares outstanding. HydroGen�s balance of cash, cash equivalents and short-term investments at December 31, 2006, totaled $24.1 million, as compared to a balance totaling $9.3 million at December 31, 2005. Spending on research and development for fiscal year 2006 amounted to $4.1 million, increasing more than 250% over fiscal year 2005. About HydroGen Corporation HydroGen Corporation is a manufacturer of multi-megawatt fuel cell systems utilizing its proprietary 400 kW phosphoric acid fuel cell (PAFC) technology. Utilizing fuel cell technology originally developed by Westinghouse Corporation, HydroGen Corporation offers a multi-megawatt, zero-emission power generation product that supports the growth of industrial distributed energy. The company targets market applications where hydrogen is currently available and other drivers favoring the adoption of fuel cells are present. Forward-Looking Statements Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently unreliable and actual results may differ materially. Examples of forward-looking statements in this news release include statements regarding HydroGen's anticipated economically competitive fuel cell systems. Factors which could cause actual results to differ materially from these forward-looking statements include such factors as fluctuations in demand for HydroGen's products, HydroGen's ability to maintain strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of HydroGen's liquidity and financial strength to support its growth, and other information that may be detailed from time to time in HydroGen's filings with the United States Securities and Exchange Commission. HydroGen undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. HYDROGEN CORPORATION AND SUBSIDIARY CONDENSED CONSOLIDATED BALANCE SHEET � DECEMBER 31,2006 DECEMBER 31, 2005 � ASSETS CURRENT ASSETS Cash and cash equivalents $ 14,170,530� $ 2,796,324� Short-term investments 9,889,603� 6,493,482� Accounts receivable 262,408� 40,042� Other current assets � 1,289,995� � 316,634� TOTAL CURRENT ASSETS 25,612,536� 9,646,482� Property and equipment, net 3,469,533� 807,372� Equipment deposits -� 224,896� Other assets � 57,017� � 14,373� TOTAL ASSETS $ 29,139,086� $ 10,693,123� � LIABILITIES AND SHAREHOLDERS� EQUITY CURRENT LIABILITIES Accounts payable and accrued expenses $ 1,659,441� $ 612,961� Capital lease obligations, current portion � 72,295� � -� TOTAL CURRENT LIABILITIES 1,731,736� 612,961� � LONG-TERM LIABILITIES Capital lease obligations, net of current portion � 119,773� � -� TOTAL LIABILITIES 1,851,509� 612,961� � Common stock, par value $0.001, authorized 65,000,000 shares, 12,769,904 and 7,614,904 issued and outstanding at December 31, 2006 and December 31, 2005, respectively 12,770� 7,615� Additional paid-in capital 42,595,815� 17,970,255� Deficit accumulated during the development stage � (15,321,008) � (7,897,708) TOTAL SHAREHOLDERS� EQUITY � 27,287,577� � 10,080,162� TOTAL LIABILITIES AND SHAREHOLDERS� EQUITY $ 29,139,086� $ 10,693,123� HYDROGEN CORPORATION AND SUBSIDIARY CONSOLIDATED STATEMENTS OF OPERATIONS � FOR THE YEARS ENDEDDECEMBER 31, 2006� 2005� Demonstration Grant Revenue $ 610,721� $ 40,042� Costs and Expenses (including stock based compensation of $561,331 and $626,019, respectively) � 8,985,568� � 4,538,347� LOSS FROM OPERATIONS � (8,374,847) � (4,498,305) Interest and other income 1,046,602� 196,253� Interest and other financing charges (95,055) (564,145) Charge for repricing conversion price of convertible debt � � (875,000) NET LOSS $ (7,423,300) $ (5,741,197) Weighted average common shares outstanding (basic and diluted) � 11,060,986� � 2,631,633� Net loss per share (basic and diluted) $ (0.67) $ (2.18)