HYDROGENICS INVESTOR PRESENTATION

Transcription

1 HYDROGENICS INVESTOR PRESENTATION May, Version: 02.17

2 Safe Harbor Statement Certain statements in the Business Update and Order Backlog sections contain forward-looking statements within the meaning of the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995, and under applicable Canadian securities laws. These statements are based on management s current expectations and actual results may differ from these forward-looking statements due to numerous factors, including: our inability to increase our revenues or raise additional funding to continue operations, execute our business plan, or to grow our business; our inability to address a slow return to economic growth, and its impact on our business, results of operations and consolidated financial condition; our limited operating history; inability to implement our business strategy; fluctuations in our quarterly results; failure to maintain our customer base that generates the majority of our revenues; currency fluctuations; failure to maintain sufficient insurance coverage; changes in value of goodwill; failure of a significant market to develop for our products; failure of hydrogen being readily available on a cost-effective basis; changes in government policies and regulations; failure of uniform codes and standards for hydrogen fuelled vehicles and related infrastructure to develop; liability for environmental damages resulting from our research, development or manufacturing operations; failure to compete with other developers and manufacturers of products in our industry; failure to compete with developers and manufacturers of traditional and alternative technologies; failure to develop partnerships with original equipment manufacturers, governments, systems integrators and other third parties; inability to obtain sufficient materials and components for our products from suppliers; failure to manage expansion of our operations; failure to manage foreign sales and operations; failure to recruit, train and retain key management personnel; inability to integrate acquisitions; failure to develop adequate manufacturing processes and capabilities; failure to complete the development of commercially viable products; failure to produce costcompetitive products; failure or delay in field testing of our products; failure to produce products free of defects or errors; inability to adapt to technological advances or new codes and standards; failure to protect our intellectual property; our involvement in intellectual property litigation; exposure to product liability claims; failure to meet rules regarding passive foreign investment companies; actions of our significant and principal shareholders; dilution as a result of significant issuances of our common shares and preferred shares; inability of US investors to enforce US civil liability judgments against us; volatility of our common share price; dilution as a result of the exercise of options; and failure to meet continued listing requirements of Nasdaq. Readers should not place undue reliance on Hydrogenics forward-looking statements. Investors are encouraged to review the section captioned Risk Factors in our regulatory filings with the Canadian securities regulatory authorities and the US Securities and Exchange Commission for a more complete discussion of factors that could affect our future performance. Furthermore, the forward-looking statements contained herein are made as of the date of this presentation, and we undertake no obligation to revise or update any forward-looking statements in order to reflect events or circumstances that may arise after the date of this presentation, unless otherwise required by law. The forward-looking statements contained in this presentation are expressly qualified by this. 2

3 Our Company Technology Geographies 145 (Patents & Applications) Extensive Know-How Wide Experience Canada, Belgium, Germany, US, SE Asia, Russia, China, Korea Canada Financial Snapshot Corporate LTM Revenue: $33.5M Backlog: $110M 1995 Start 2000 IPO HYGS NASDAQ; HYG TSX 12.5M basic 13.5M fully diluted Germany 3 Belgium

4 How Do Our Products Work? Fuel Cell (Power Systems) Takes Hydrogen and creates electricity Hydrogen Air Fuel Cell Electromechanical Engine Electric Power Water Electrolyzer (Onsite Generation) Takes electric power (often from renewables) and creates Hydrogen fuel for bulk energy storage Water Electric Power Electrolyzer Gas Generation Hydrogen Fuel Oxygen 4

5 Many applications on two standardized platforms (Growth) (Simplicity & Cost Reduction) Extended Range Electric Rail Transport for Europe Utility Scale Energy Storage for Germany & Canada Clean Electric Public Transport in California & China Clean Continuous Power Generation in Korea 5

6 Q Highlights Strong start to the year with top line growth and healthy margin profile Recent wins across multiple verticals including mobility, power to gas, and progress in China Order intake of $11M contributing to record $110M backlog New funding pathway via $21M private placement with Hejili illustrating investor confidence in HYGS and the market potential in China Fuel Cells in China: Strong demand for mobility solutions and market driven investor interest 6

7 Salzgitter, Germany Stuttgart, Germany California, USA HYDROGEN MOBILITY Winnipeg, Canada & Scottsdale, Arizona Basel, Switzerland Toronto, Canada 7

8 Hydrogen Mobility Solutions Hydrogenics HyPM power modules provide a robust and flexible platform for zero-emission mobility applications. Proven track record for superior performance, durability and reliability Simple electrical and mechanical interfaces for easy integration with electric vehicles Robust stack architecture with no humidifier, low pressure and dry/dry features High durability components for demanding conditions The ultimate OEM friendly solution for light and heavy mobility applications Greatest range of kw systems 8

9 Commuter Rail Update Fuel cells for zero-emission passenger trains Alstom Coradia ilint: Successful testing for first 80km run Dynamic testing at EU rail certification facility in the Czech republic virtually complete, with very positive results First series production orders on overall 50M order anticipated in near future Excellent sales engagement with end customers through market leader Alstom Transport Additional rail platforms under discussion 9

10 China Update Continued expansion into the Chinese market Significant product now on the road and doing well Further scale up in orders anticipated for 2017 Certified Integrator Program (CIP) on track, with additional partners under review Moving through scale-up process of unit development New investor represents incremental market penetration opportunity and should accelerate Hydrogenics growth across energy storage, fueling, and grid-related projects Beijing, China: First prototype with 40,000 km road service 10

11 Aberdeen, Scotland Hamburg, Germany Barcelona, Spain HYDROGEN FUELING Halle, Belgium Stuttgart, Germany Oslo, Norway 11

12 Hydrogen Fueling Solutions Hydrogenics has supplied zero-emission solutions to over 50 fueling stations more than any other hydrogen fueling company. Production capabilities from 20kg to over 1,000 kg per day 350 and 700 bar stations Fully interconnected systems for easy installations Designed for clean onsite hydrogen production or delivered hydrogen Built to the highest standards Zero-emission fueling for clean mobility solutions 12

13 Falkenhagen, Germany Hamburg, Germany Grapzow, Germany RENEWABLE HYDROGEN & GRID BALANCING Falkenhagen, Germany Katinnik, Quebec Avedøre, Denmark 13

14 Renewable Hydrogen Solutions Hydrogen produced from renewable power via water electrolysis enables the transition to a cleaner future across all energy sectors and applications. Power-to Gas: Injecting hydrogen or synthetic natural gas into the gas grid Offering hydrogen solutions for a renewable based energy system Power-to-Mobility: Hydrogen refueling for fuel cell electric vehicles Power-to-Industry: Using hydrogen as a feedstock for industrial facilities Power-to-Fuel: Using hydrogen as a feedstock for traditional fuel production Power-to-Power: Repowering hydrogen through a fuel cell 14

15 Saint Gobain, Colombia Elemash, Russia INDUSTRIAL HYDROGEN Bushan, India Camao, Brazil Nyagan, Russia Kirovgrad, Russia 15

16 Industrial Hydrogen Solutions Hydrogenics HySTAT and HyLYZER electrolyzers generate pure hydrogen for zero-emission solutions. On-site and on-demand hydrogen generation Designed for automatic and continuous operation Customizable and easy to integrate for industrial and utility industries PEM and alkaline units, built to the highest safety standards Clean and renewable hydrogen generation: on-site and ondemand 16

17 Istanbul, Turkey Port of Honolulu, Hawaii, USA Daesan, South Korea CRITICAL POWER Surrey, Daesan, United South Kingdom Korea Nuuk, Greenland Brisbane, Australia 17

18 Critical Power Solutions Hydrogenics HyPM power modules set the technology benchmark for meeting intermittent and continuous power needs. Designed for superior performance Fully integrated stack with power range flexibility from 3kW to 50 MW Best footprint with scalable design solutions to meet runtime needs 10,000+ hour stack lifetime with unlimited stop and start cycles Greatest range of kw systems The ultimate solution for reliable backup, standby and continuous power applications 18

19 Recent Award Activity Span across end markets and around the globe 2.4 Megawatt Power-to-Gas (P2G) award in Germany 1 Megawatt P2G system in Scotland H2 Fueling Wins: First GTA stations Largest renewable station in U.S. Two fueling stations in Greater Toronto The largest renewable hydrogen fueling station in the U.S. includes CelerityPlus power modules to be integrated into New Flyer fuel cell buses 19

20 Major Program Progress Program Area Lead Customer Status Value Hydrogen Rail Alstom Transport Program on schedule, with on-rail testing underway Pre-series complete; Series production order is pending Mobility 4 Certified Integrator Partners (CIP) China >50M Booked progressing toward 1000 unit orders >$50M Potential Power-to-Gas E.ON Enbridge First Canadian facility in operation Q2 Additional wins (California 2.5MW & Germany 2.5MW) $20M in delivery $70M Potential Fueling Various Good progress in California and Canada More to come Propulsion Confidential First commercial product builds underway Total program valued at $90M won in 2012 Stationary MW Power Kolon 1MW pilot ran to year-end 2016 as planned Three 5MW sites under review Detritiation Kurion Awaiting next step direction in Japan Won a further detritiation pilot unit in March Automotive & Rail Confidential New early-stage technology development support and vehicle integration $30M Firm (70% complete) $60M not in Backlog >$20M Potential TBD 20

21 Building & Delivering Value Global technology leadership demonstrated in competitive markets with Alstom, E.ON, Enbridge, and Chinese CIPs Multiple pathways to scale serves as a hedge against the uncertainty of any one application Business opportunities across geographies yield significant intrinsic value as applications scale independently Strong cost discipline to yield significant operating leverage when scaling Backlog remains at record levels supporting significant growth in revenue for 2017 Southeast Asia s First 1MW Renewable Hydrogen Plant 21

22 Financial Results 22

23 Q1 Results (in $ millions) Three months ended Mar. 31 Change $ % Revenue $ 8.8 $ % Gross Profit % Gross Margin % 30.3% 28.0% Operating Expenses Selling, general and administrative (excluding stock-based compensation, amortization and depreciation) % Research and product development (0.1) (11)% Adjusted EBITDA $ (0.7) $ (1.9) $ (1.2) (62)% Notes Adjusted EBITDA is defined as net loss excluding: cash settled long term compensation indexed to share price, share settled stock-based compensation expense, net finance income and expenses, depreciation and amortization. Adjusted EBITDA is a non-ifrs measure and may not be comparable to similar measures used by other companies. Management uses Adjusted EBITDA as a useful measure of ongoing operational results. SG&A in Q includes a reversal of an indemnification liability of $0.5 million. Excluding this reversal, SG&A expenses decreased less than $0.1 million for the three months ended March 31, 2017 when compared to the prior period. 23

24 Order Backlog As of March 31, 2017 ($M) Jan. 1/17 Backlog Orders Received FX Orders Delivered Mar. 31/17 Backlog OnSite Generation $ 20.8 $ 9.5 $ 0.2 $ 2.1 $ 28.4 Power Systems Total $ $ 11.0 $ 1.0 $ 8.8 $ Of the above backlog of $109.8 million, the Company expects to recognize $44.1 million in the following twelve months as revenue. In addition, revenue for the year ending December 31, 2017 will include orders received and delivered during the balance of

25 Consolidated Balance Sheet Highlights ($M) Mar. 31, 2017 Dec. 31, Change 2016 $ % Cash and cash equivalents and restricted cash $ 11.7 $ % Trade, other and grants receivable % Inventories (0.6) (4)% Operating borrowings % Trade and other payables % Financial liabilities % 25

26 Q1 Reconciliation of Non-IFRS Measures Adj. EBITDA ($M) Three months ended March 31, 2017 Three months ended March 31, 2016 Net loss $ 2.3 $ 2.4 Finance loss, net (0.9) (0.2) Amortization and depreciation (0.2) (0.2) Compensation indexed to share price (0.3) - Stock-based compensation expense (0.2) (0.1) Adjusted EBITDA loss $ 0.7 $ 1.9 * Note certain figures have been adjusted for rounding 26

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