VANCOUVER, BC, May 10, 2023
/CNW/ - Ballard Power Systems (NASDAQ: BLDP) (TSX: BLDP) today
announced consolidated financial results for the first quarter
ended March 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 first quarter revenue of $13.3
million and new order intake of $17.6
million are consistent with our full-year 2023 plan," said
Randy MacEwen, President and CEO.
"With an increasingly positive policy landscape, we see growing
customer interest in our core mobility markets of bus, truck, rail,
and marine in Europe and
North America. We believe our
$137.7 million Order Backlog reflects
continued customer platform wins, including a record Power Products
Order Backlog that has doubled from one year ago and now exceeds
$100 million. This positions us for a
busy second half of 2023, where we expect second half revenue to be
approximately 70% of our annual total, and an exciting set-up for
2024."
"With our Q1 expenses also on plan, we are tracking to our
full-year guidance ranges for operating and capital expenses. We
continue to prioritize investments in our technology and product
development programs, product cost reduction initiatives, customer
platform wins, customer experience, and advanced manufacturing,"
Mr. MacEwen added.
Mr. MacEwen continued, "As previously communicated, we continue
to see gross margin pressures into 2024 given our revenue mix,
pricing strategy, investments in production capacity, and timing
lag before our production volumes ramp and our product cost
reduction initiatives move into production. We ended the quarter
with $863.8 million in cash
reserves."
"We are looking forward to our upcoming Capital Markets Day on
June 13th, where we will
provide key updates on long-term business plan, including sales
growth in our verticals, gross margin progression, our technology
and product roadmap, product cost reduction, capital expenditures,
and ESG initiatives. We will also unveil our TCO-driven comparative
value proposition model for fuel cell trucks," Mr. MacEwen
concluded.
Q1 2023 Financial
Highlights
(all comparisons are to Q1 2022 unless otherwise
noted)
- Total revenue was $13.3 million
in the quarter, down 37% year-over-year.
-
- Heavy Duty Mobility revenue of $8.7
million decreased 11%, driven primarily by lower revenues
from Technology Services contracts in China relating to our truck vertical,
partially offset by higher rail and marine revenue.
- Stationary revenue of $2.5
million decreased 58% due primarily to a decrease in sales
of stationary power generation fuel cell modules, stacks, products,
and services in Australia.
- Emerging and Other Markets revenue of $2.1 million decreased 61% due primarily to the
completion of the Audi Technology Services program and lower
shipments in our Materials Handling segment.
- Power products revenue represented more than 70% of our total
revenue in the quarter.
- Gross margin was (42)% in the quarter, a decrease of 41-points,
driven by a combination of a greater weight of power products in
the revenue mix, pricing strategy, increased investment in
manufacturing capacity, increases in supply and labor costs, and
inventory adjustments.
- Total Operating Expenses and Cash Operating Costs3
were $37.5 million and $32.0 million, respectively, an increase of 24%
and 23%, respectively, from Q1 2022. Increases were driven
primarily by higher expenditures on research, technology and
product development activities, and sales and marketing
activities.
- Adjusted EBITDA3 was ($38.3)
million, compared to ($27.5)
million in Q1 2022, primarily as a result of the decrease in
gross margin and increase in Cash Operating Costs.
- Ballard received approximately $17.6
million of new orders in Q1, and delivered orders valued at
$13.3 million, resulting in an Order
Backlog of approximately $137.7
million at end-Q1. Order Backlog growth was driven
predominantly by increased orders from Europe and North
America in the bus and stationary power markets. These
regions combined represent approximately 76% of the total Order
Backlog, compared to approximately 39% at end-Q1 2022.
Specifically, the Power Products Order Backlog accounts for nearly
75% of our total Order Backlog, an increase of 100% since Q1 2022,
and is at the highest level in Ballard's history.
- The 12-month Order Book was $73.9
million at end-Q1, an increase of $16.6 million from the end of Q4 2022, an
approximately 29% quarter over quarter increase.
Order Backlog
($M)
|
Order Backlog
at End-Q4 2022
|
Orders Received
in Q1 2023
|
Orders Delivered
in Q1 2023
|
Order Backlog
at End-Q1 2023
|
Total Fuel Cell
Products & Services
|
$133.4
|
$17.6
|
$13.3
|
$137.7
|
2023 Outlook
Consistent with the Company's past practice, and in view of the
early stage of hydrogen fuel cell market development and adoption,
we are not providing revenue or net income (loss) guidance for
2023. In 2023, we continue our plan to invest in the business ahead
of the hydrogen growth curve, with Total Operating
Expense3 and Capital Expenditure4 guidance
ranges as follows:
2023
|
Guidance
|
Total Operating
Expense3
|
$135 - $155
million
|
Capital
Expenditure4
|
$40 - $60
million
|
Q1 2023 Financial
Summary
(Millions of U.S.
dollars)
|
Three months
ended March 31
|
|
2023
|
2022
|
% Change
|
REVENUE
|
|
|
|
Fuel Cell Products
& Services:1
|
|
|
|
Heavy-Duty
Mobility
|
$8.7
|
$9.8
|
(11 %)
|
Bus
|
$2.9
|
$4.0
|
(28 %)
|
Truck
|
$2.4
|
$3.5
|
(32 %)
|
Rail
|
$1.8
|
$1.7
|
2 %
|
Marine
|
$1.7
|
$0.5
|
217 %
|
Stationary
|
$2.5
|
$5.8
|
(58 %)
|
Emerging and Other
Markets
|
$2.1
|
$5.4
|
(61 %)
|
Total Fuel Cell
Products & Services Revenue
|
$13.3
|
$21.0
|
(37) %
|
PROFITABILITY
|
|
|
|
Gross Margin
$
|
($5.6)
|
$(0.2)
|
(2,569 %)
|
Gross Margin
%
|
(42 %)
|
(1 %)
|
(41)pts
|
Total Operating
Expenses
|
$37.5
|
$30.3
|
24 %
|
Cash Operating
Costs2
|
$32.0
|
$26.1
|
23 %
|
Equity loss in JV &
Associates
|
($0.9)
|
($2.2)
|
59 %
|
Adjusted
EBITDA3
|
($38.3)
|
($27.5)
|
(39 %)
|
Net Loss
|
($33.9)
|
($40.4)
|
16 %
|
Loss Per
Share
|
($0.11)
|
($0.14)
|
21 %
|
CASH
|
|
|
|
Cash provided by (used
in) Operating Activities:
|
|
|
|
Cash Operating
Loss
|
($27.6)
|
($24.6)
|
(12 %)
|
Working Capital
Changes
|
($9.0)
|
($17.1)
|
47 %
|
Cash used
by Operating Activities
|
($36.6)
|
($41.7)
|
12 %
|
Cash
Reserves
|
$863.8
|
$1,068.2
|
(19 %)
|
For a more detailed discussion of Ballard Power Systems' first
quarter 2023 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 Wednesday, May 10, 2023 at 8:00 a.m. Pacific Time (11:00 a.m. Eastern Time) to review first 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).
Short Form Base Shelf
Prospectus
Ballard also announces the filing of a final short form base
shelf prospectus dated May 9, 2023
(the "Prospectus") in each of the provinces and territories
of Canada together with a
corresponding shelf registration statement on Form F-10 (the
"Registration Statement") with the United States Securities
and Exchange Commission (the "SEC") qualifying for issuance
common shares, preferred shares, warrants to purchase common
shares, debt securities and units comprised of one or more of any
of the foregoing from time to time over the 25-month period that
the Prospectus remains effective. If any securities are offered
under the Prospectus and/or Registration Statement, the terms of
any such securities and the intended use of the net proceeds
resulting from any such offering will be established at the time(s)
of any such offerings, and will be described in a Prospectus
supplement filed with applicable Canadian securities regulators
and/or the SEC, respectively. The Prospectus replaces Ballard's
previous short form base shelf prospectus dated March 29, 2021, which expired on April 29, 2023. Copies of the Prospectus and the
Registration Statement are available at www.sedar.com and
www.sec.gov, respectively.
This release shall not constitute an offer to sell or a
solicitation of an offer to buy securities, nor shall there be any
sale of securities, in any jurisdiction in which an offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
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, impacts of investments in manufacturing and
R&D capabilities and cost reduction initiatives and statements
that describe any anticipated offering of securities under
Ballard's Prospectus and Registration Statement or the filing of a
Prospectus supplement. 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,
successfully achieving 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 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.
|
|
2 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.
|
|
3 Total
Operating Expenses refer to the measure reported in accordance with
IFRS.
|
|
4 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
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended
March 31,
|
Cash Operating
Costs
|
2023
|
2022
|
$
Change
|
Total Operating
Expenses
|
$
37,517
|
$
30,311
|
$
7,206
|
|
Stock-based
compensation expense
|
(2,315)
|
(2,329)
|
14
|
|
Impairment
recovery (losses) on trade receivables
|
-
|
-
|
-
|
|
Acquisition
related costs
|
(658)
|
(118)
|
(540)
|
|
Restructuring
and related costs
|
(822)
|
(20)
|
(802)
|
|
Impact of
unrealized gains (losses) on foreign exchange contracts
|
490
|
347
|
143
|
|
Depreciation and
amortization
|
(2,178)
|
(2,102)
|
(76)
|
|
Cash Operating
Costs
|
$
32,034
|
$
26,089
|
$
5,945
|
|
|
|
|
|
(Expressed in
thousands of U.S. dollars)
|
Three months ended
March 31,
|
EBITDA and Adjusted
EBITDA
|
2023
|
2022
|
$
Change
|
Net loss
|
$
(33,918)
|
$
(40,395)
|
$
6,477
|
Depreciation and
amortization
|
3,167
|
3,109
|
58
|
Finance
expense
|
282
|
347
|
(65)
|
Income taxes
(recovery)
|
-
|
(200)
|
200
|
EBITDA
|
$
(30,469)
|
$
(37,139)
|
$
6,670
|
Stock-based
compensation expense
|
2,315
|
2,329
|
(14)
|
Acquisition
related costs
|
658
|
118
|
540
|
Finance and
other (income) loss
|
(10,294)
|
7,491
|
(17,785)
|
Impact of
unrealized (gains) losses on foreign exchange contracts
|
(490)
|
(347)
|
(143)
|
Adjusted
EBITDA
|
$
(38,280)
|
$
(27,548)
|
$
(10,732)
|
|
|
|
|
|
|
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SOURCE Ballard Power Systems Inc.