VANCOUVER, BC, March 11,
2024 /PRNewswire/ - Ballard Power Systems
(NASDAQ: BLDP) (TSX: BLDP) today announced consolidated financial
results for the fourth quarter ended December 31, 2023. All amounts are in U.S.
dollars unless otherwise noted and have been prepared in accordance
with International Financial Reporting Standards (IFRS).
"Our transition to a commercial products company is gaining
momentum, with growing market acceptance of our fuel cell engines
across our verticals," said Randy
MacEwen, President and CEO. "We shipped a record number of
fuel cell engines in the quarter, allowing us to close out the year
with Q4 revenue of $46.8 million, up
132% year-over-year. We also booked $64.7
million of new orders in Q4, resulting in a product-based
Order Backlog now 15% higher than the same period last year."
"Supported by revenue scaling in the quarter, we were able to
improve gross margins by eight percentage points compared to the
prior year period," said Mr. MacEwen. "Notably, excluding non-cash
inventory provisions, underlying gross margin almost achieved
breakeven, demonstrating continued success in our product cost
reduction initiatives and the impact of operating leverage."
"Excluding discontinued operations, revenue in 2023 was
$102.4 million, up 25% compared to
the prior year, while total megawatts (MW) and number of modules
shipped increased by 17% and 37%, respectively, to 74 MW and 540
modules. We increased the proportion of 2023 revenue and
year-ending Order Backlog from Power Products, standing at 72% and
84% respectively," stated Mr. MacEwen. "We increased our
diversification across our verticals, geographic regions, and
customer base. We supported numerous customers in maturing their
fuel cell platforms, while also securing new customer platform wins
across our verticals. We launched our next-generation bipolar plate
project to enable further product cost reduction and production
scaling and also proved the maturity of our technology with
outstanding field reliability."
"We continue to prioritize focused and disciplined cash
management and balance sheet strength. Cash operating costs in Q4
were roughly flat compared to the prior year, while total operating
costs and capital expenditures for the full year were in line with
our 2023 guidance ranges. Total cash used in 2023 was down almost
$48 million compared to 2022. We
ended the year with cash and cash equivalents of $751 million," Mr. MacEwen added.
"Looking forward, we believe the transition of hydrogen policy
announcements to implementation will provide mid-term momentum for
the availability of low-cost, low-carbon hydrogen, enabling
accelerated adoption of fuel cells. In the context of an
increasingly constructive policy environment, a growing sales
pipeline and Order Backlog, along with our continued investments in
product cost reduction and advanced manufacturing, we are well
positioned for strong long-term market share. We are excited with
our set-up for 2024, as we expect continued growth in our Order
Backlog, major order announcements from customers in our bus and
stationary power verticals, and the announcement of our next
manufacturing facility, each of which will serve as important
milestones on our journey to scaled adoption of hydrogen fuel
cells."
Q4 2023 Financial Highlights
(all comparisons are to Q4 2022 unless otherwise
noted)
- Total revenue was $46.8 million in the quarter, up 132%
year-over-year.
- Heavy Duty Mobility revenue of $29.0
million increased 219%, driven by higher revenues from bus,
truck, rail, and marine verticals.
- Stationary revenue of $12.8
million increased 105% primarily due to higher shipments to
customers in Europe.
- Emerging and Other Markets revenue of $4.9 million was flat compared to the prior year,
as increased revenues from off-highway customers were offset by a
decrease in Technology Solutions revenue.
- Gross margin was (22)% in the quarter, an increase of 8-points,
driven by higher revenues and product cost reduction initiatives.
Excluding non-cash inventory provisions, gross margin in the
quarter was (1)%.
- Total Operating Expenses and Cash Operating Costs3
were $35.0 million and $29.0 million, respectively, an increase of
16% and (0%), respectively, from Q4 2022. The increase in Total
Operating Expenses was driven primarily by higher expenditures on
research and product development.
- Total Cash Used by Operating Activities was $18.3 million, compared to $21.2 million in the prior year, while Total Cash
Used by Investing Activities was $10.8
million, compared to $20.1
million in Q4 2022. Cash and cash equivalents was
$751.1 million at the end of 2023,
compared to $913.7 million in the
prior year.
- Adjusted EBITDA3 was ($44.1)
million, compared to ($40.1)
million in Q4 2022, primarily as a result of a higher gross
margin loss driven by inventory impairment charges.
- Ballard recorded non-cash impairments to the value of its
long-term financial investments in the amount of $10.3 million in the quarter, primarily due to a
reduction in valuations across the clean energy and zero-emission
vehicle universe.
- Order Backlog at the end of 2023 was $130.5 million, down 3% compared to the end of
Q3. While we achieved strong new order intake of $64.7 million in Q4, this was more than offset by
a reduction of $47.1 million due
to record engine shipments during the quarter and the removal of
$21.7 million from our Order Backlog
of previously booked orders from a specific customer experiencing
financing and program delays. Orders from Power Products represent
more than 80% of the Order Backlog, while orders from customers in
Europe and North America represent almost 80% of the
Order Backlog.
- The 12-month Order Book was $66.6
million at end-Q4, a decrease of $6.1
million or approximately 8% from the end of Q3 2023. While
we achieved strong new order intake of $60.4
million added to the Order Book in Q4, this was more than
offset by record engine shipments during the quarter and the
removal of $19.4 million from our
Order Book of previously booked orders from a specific customer
experiencing financing and program delays.
|
Order Backlog
($M)
|
Order Backlog
at End-Q3 2023
|
Orders Received
in Q4 2023
|
Orders Delivered
in Q4 2023
|
Order Backlog
at End-Q4 20235
|
|
Total Fuel Cell
Products & Services
|
$134.6
|
$64.7
|
$47.1
|
$130.5
|
2024 Outlook
Consistent with our past practice, and in view of the early
stage of hydrogen fuel cell market development, specific revenue or
net income (loss) guidance for 2024 is not provided. We expect
revenue in 2024 will be back-half weighted, with roughly 30% in the
first half and 70% in the second half, similar to 2023. Total
Operating Expense3 and Capital Expenditure4
guidance ranges for 2024 are as follows:
|
2024
|
Guidance
|
|
Total Operating
Expense1
|
$145 - $165
million
|
|
Capital
Expenditure2
|
$50 - $70
million
|
Q4 2023 Financial Summary
|
(Millions of U.S.
dollars)
|
Three months
ended December 31
|
|
2023
|
2022
|
% Change
|
|
REVENUE
|
|
|
|
|
Fuel Cell Products
& Services:3
|
|
|
|
|
Heavy-Duty
Mobility
|
$29.0
|
$9.1
|
219 %
|
|
Bus
|
$12.0
|
$2.7
|
341 %
|
|
Truck
|
$6.0
|
$2.5
|
135 %
|
|
Rail
|
$7.0
|
$2.7
|
163 %
|
|
Marine
|
$4.0
|
$1.1
|
250 %
|
|
Stationary
|
$12.8
|
$6.2
|
105 %
|
|
Emerging and Other
Markets
|
$4.9
|
$4.9
|
1 %
|
|
Total Fuel Cell
Products & Services Revenue
|
$46.8
|
$20.2
|
132 %
|
|
PROFITABILITY
|
|
|
|
|
Gross Margin
$
|
($10.2)
|
($6.1)
|
(67 %)
|
|
Gross Margin
%
|
(22 %)
|
(30 %)
|
8pts
|
|
Total Operating
Expenses
|
$35.0
|
$30.1
|
(16 %)
|
|
Cash Operating
Costs4
|
$29.0
|
$29.0
|
(0 %)
|
|
Equity loss in JV &
Associates
|
($4.3)
|
($6.8)
|
37 %
|
|
Adjusted
EBITDA4
|
($44.1)
|
($40.1)
|
(10 %)
|
|
Net Loss from
Continuing Operations3
|
($48.9)
|
($27.6)
|
(77 %)
|
|
Loss Per Share from
Continuing Operations3
|
($0.16)
|
($0.09)
|
(78 %)
|
|
CASH
|
|
|
|
|
Cash provided by (used
in) Operating Activities:
|
|
|
|
|
Cash Operating
Loss
|
($17.5)
|
($23.0)
|
24 %
|
|
Working Capital
Changes
|
($0.9)
|
$1.8
|
(148 %)
|
|
Cash used
by Operating Activities
|
($18.3)
|
($21.2)
|
13 %
|
|
Cash and cash
equivalents
|
$751.1
|
$913.7
|
(18 %)
|
|
|
|
(Millions of U.S.
dollars)
|
Twelve months ended
December 31
|
|
2023
|
2022
|
% Change
|
|
REVENUE
|
|
|
|
|
Fuel Cell Products
& Services:3
|
|
|
|
|
Heavy-Duty
Mobility
|
$66.7
|
$43.7
|
53 %
|
|
Bus
|
$29.3
|
$24.9
|
17 %
|
|
Truck
|
$11.0
|
$11.5
|
(4 %)
|
|
Rail
|
$19.1
|
$5.1
|
274 %
|
|
Marine
|
$7.3
|
$2.2
|
236 %
|
|
Stationary
|
$21.7
|
$18.9
|
15 %
|
|
Emerging and Other
Markets
|
$14.0
|
$19.3
|
(27 %)
|
|
Total Fuel Cell
Products & Services Revenue
|
$102.4
|
$81.9
|
25 %
|
|
PROFITABILITY
|
|
|
|
|
Gross Margin
$
|
($21.8)
|
$(13.3)
|
(64 %)
|
|
Gross Margin
%
|
(21 %)
|
(16 %)
|
(5pts)
|
|
Total Operating
Expenses
|
$141.1
|
$132.0
|
(7 %)
|
|
Cash Operating
Costs4
|
$119.3
|
$112.0
|
(7 %)
|
|
Equity loss in JV &
Associates
|
($10.1)
|
($11.6)
|
13 %
|
|
Adjusted
EBITDA4
|
($150.1)
|
($132.6)
|
(13 %)
|
|
Net Loss from
Continuing Operations3
|
($144.2)
|
($160.4)
|
10 %
|
|
Loss Per Share from
Continuing Operations3
|
($0.48)
|
($0.54)
|
11 %
|
|
CASH
|
|
|
|
|
Cash provided by (used
in) Operating Activities:
|
|
|
|
|
Cash Operating
Loss
|
($87.5)
|
($114.2)
|
23 %
|
|
Working Capital
Changes
|
($17.1)
|
($17.9)
|
5 %
|
|
Cash used
by Operating Activities
|
($104.6)
|
($132.2)
|
21 %
|
|
Cash and cash
equivalents
|
$751.1
|
$913.7
|
(18 %)
|
For a more detailed discussion of Ballard Power Systems' fourth
quarter 2023 results, please see the company's financial statements
and management's discussion & analysis, which are available at
www.ballard.com/investors, www.sedarplus.ca and
www.sec.gov/edgar.shtml.
Conference Call
Ballard will hold a conference call on
Monday, March 11, 2024 at
8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review fourth quarter
2023 operating results. The live call can be accessed by dialing
+1.604.638.5340. Alternatively, a live audio and 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, and stationary power. To learn more
about Ballard, please visit www.ballard.com.
Important Cautions Regarding Forward-Looking
Statements
Some of the statements contained in this release
are forward-looking statements within the meaning of the U.S.
Securities Act of 1933, as amended, and U.S. Securities Exchange
Act of 1934, as amended, and forward-looking information within the
meaning of Canadian securities laws, such as statements concerning
the markets for our products, Order Backlog, expected revenues,
gross margins, operating expenses, capital expenditures, corporate
development activities, and impacts of investments in manufacturing
and R&D capabilities and cost reduction initiatives. 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. Since forward-looking statements are not statements of
historical fact and address future events, conditions and
expectations, forward-looking statements by their nature inherently
involve unknown risks, uncertainties, assumptions and other factors
well beyond Ballard's ability to control or predict. Actual events,
results and developments may differ materially from those
contemplated by such forward-looking statements. Any such
statements are based on Ballard's assumptions relating to its
financial forecasts and expectations regarding its product
development efforts, manufacturing capacity, market demand and
financing needs. 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,
level of achievement of our business plans, achieving and
sustaining profitability, Ballard's condition requiring anticipated
use of proceeds to change and the timing of, and ability to obtain,
required regulatory approvals. 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 represent
Ballard's views as of the date of this release. There can be no
assurance that forward-looking statements will prove to be
accurate, as actual events and future events could differ
materially from those anticipated in such statements. 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 Total Operating Expenses
refer to the measure reported in accordance with IFRS.
|
|
|
2 Capital Expenditure is
defined as Additions to property, plant and
equipment and Investment in other intangible assets as
disclosed in the Consolidated Statements of Cash Flows
|
|
|
3 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 of PEM fuel cell products and services for a
variety of applications including Heavy-Duty Mobility (consisting
of bus, truck, rail, and marine applications), Stationary Power,
and Emerging and Other Markets (consisting of material handling,
off-road, and other applications). Revenues from the delivery of
Services, including technology solutions, after sales services and
training, are included in each of the respective markets.
|
|
|
During the fourth
quarter of 2023, we completed a restructuring of operations at
Ballard Motive Solutions in the U.K. and effectively closed the
operation. As such, the historic operating results (including
revenue and operating expenses) of the Ballard Motive Solutions
business for both 2023 and 2022 have been removed from continuing
operating results and are instead presented separately in the
statement of comprehensive income (loss) as loss from discontinued
operations.
|
|
|
4 Note that Cash Operating
Costs, EBITDA, and Adjusted EBITDA 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, and Adjusted EBITDA 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, and Adjusted EBITDA to the Consolidated
Financial Statements, please refer to the tables below.
|
|
|
Cash Operating Costs
measures total operating expenses excluding stock-based
compensation expense, depreciation and amortization, impairment
losses or recoveries on trade receivables, restructuring charges,
acquisition related 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, acquisition
related costs, finance and other income, recovery on settlement of
contingent consideration, asset impairment charges, and the impact
of unrealized gains or losses on foreign exchange
contracts.
|
|
|
5 Total Order Backlog as
at the end of Q4-2023, reflects the addition of orders received of
$64.7m, less delivered orders of $47.1 million, and less the
removal of orders valued at $21.7m.
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended
December 31,
|
|
Cash Operating
Costs
|
2023
|
2022
|
$
Change
|
|
Total Operating
Expenses
|
$
34,972
|
$
30,099
|
$
4,873
|
|
Stock-based
compensation expense
|
(2,575)
|
(1,367)
|
(1,208)
|
|
Impairment
recovery (losses) on trade
receivables
|
(1,436)
|
(73)
|
(1,363)
|
|
Acquisition
related costs
|
3
|
(106)
|
109
|
|
Restructuring
and related (costs) recovery
|
(322)
|
(137)
|
(185)
|
|
Impact of
unrealized gains (losses) on foreign
exchange
contracts
|
696
|
1,057
|
(361)
|
|
Depreciation and
amortization
|
(2,388)
|
(435)
|
(1,953)
|
|
Cash Operating
Costs
|
$
28,950
|
$
29,038
|
$
(88)
|
|
|
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Year ended December
31,
|
|
Cash Operating
Costs
|
2023
|
2022
|
$
Change
|
|
Total Operating
Expenses
|
$
141,073
|
$
132,022
|
$
9,053
|
|
Stock-based
compensation expense
|
(10,720)
|
(8,939)
|
(1,781)
|
|
Impairment
recovery (losses) on trade
receivables
|
(1,498)
|
(73)
|
(1,425)
|
|
Acquisition
related costs
|
(773)
|
(2,857)
|
2,084
|
|
Restructuring
and related (costs) recovery
|
(1,512)
|
(482)
|
(1,030)
|
|
Impact of
unrealized gains (losses) on foreign
exchange
contracts
|
1,296
|
(862)
|
2,158
|
|
Depreciation and
amortization
|
(8,539)
|
(6,815)
|
(1,724)
|
|
Cash Operating
Costs
|
$
119,327
|
$
111,992
|
$
7,335
|
|
|
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended
December 31,
|
|
EBITDA and Adjusted
EBITDA
|
2023
|
2022
|
$
Change
|
|
Net loss from
continuing operations
|
$
(48,889)
|
$
(27,572)
|
$
(21,317)
|
|
Depreciation and
amortization
|
3,524
|
2,401
|
1,123
|
|
Finance
expense
|
270
|
294
|
(24)
|
|
Income taxes
(recovery)
|
40
|
34
|
6
|
|
EBITDA
|
$
(45,055)
|
$
(24,843)
|
$
(20,212)
|
|
Stock-based
compensation expense
|
2,575
|
1,367
|
1,208
|
|
Acquisition
related costs
|
(3)
|
106
|
(109)
|
|
Finance and
other (income) loss
|
(1,871)
|
(15,728)
|
13,857
|
|
Impairment
charge on property, plant and
equipment
|
967
|
7
|
960
|
|
Impact of
unrealized (gains) losses on foreign
exchange
contracts
|
(696)
|
(1,057)
|
361
|
|
Adjusted
EBITDA
|
$
(44,083)
|
$
(40,148)
|
$
(3,935)
|
|
|
|
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Year ended December
31,
|
|
EBITDA and Adjusted
EBITDA
|
2023
|
2022
|
$
Change
|
|
Net loss from
continuing operations
|
$
(144,210)
|
$
(160,371)
|
$
16,161
|
|
Depreciation and
amortization
|
12,750
|
11,652
|
1,098
|
|
Finance
expense
|
1,105
|
1,265
|
(160)
|
|
Income taxes
(recovery)
|
158
|
42
|
116
|
|
EBITDA
|
$
(130,197)
|
$
(147,412)
|
$
17,215
|
|
Stock-based
compensation expense
|
10,720
|
8,939
|
1,781
|
|
Acquisition
related costs
|
773
|
2,857
|
(2,084)
|
|
Finance and
other (income) loss
|
(31,055)
|
2,112
|
(33,167)
|
|
Impairment
charge on property, plant and
equipment
|
967
|
7
|
960
|
|
Impact of
unrealized (gains) losses on foreign
exchange
contracts
|
(1,296)
|
862
|
(2,158)
|
|
Adjusted
EBITDA
|
$
(150,088)
|
$
(132,635)
|
$
(17,453)
|
|
|
|
|
|
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SOURCE Ballard Power Systems Inc.
