Attached files
| file | filename |
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| 8-K - FORM 8-K - FUELCELL ENERGY INC | c14000e8vk.htm |
Exhibit 99.1
FuelCell Energy Reports First Quarter Results
and Latest Accomplishments
and Latest Accomplishments
| • | California investor-owned utility orders 1.4 megawatt DFC1500 | ||
| • | Fuel Cells Earn Prominent Position within South Korean Renewable Portfolio Standard Pricing Mechanism | ||
| • | Initial order from the United Kingdom for a Direct FuelCell power plant | ||
| • | Margins improve with cost ratio moving to 1.09 | ||
| • | $18 million raised from registered direct offering | ||
| • | $70 million of cash and investments at January 31, 2011 |
DANBURY, CT — March 9, 2011 — FuelCell Energy, Inc. (Nasdaq:FCEL), a leading manufacturer of
ultra-clean, efficient and reliable power plants using renewable and other fuels for commercial,
industrial, government, and utility customers, today reported results for its first quarter ended
January 31, 2011 along with its latest accomplishments.
Financial Results
FuelCell Energy reported total revenues for the first quarter of 2011 of $28.1 million compared to
$14.6 million in the same period last year. Product sales and revenues in the first quarter were
$25.8 million compared to $12.8 million in the prior year quarter as production was increased to
meet growing order volume. Product sales and revenues for the first quarter of 2011 included $20.4
million of power plants, fuel cell modules, and fuel cell power plant components, $2.5 million of
revenue primarily from the sale of capital equipment to POSCO Power for their fuel cell module
assembly facility as well as construction and installation services, and $2.9 million of revenue
from service and power purchase agreements.
Margins for product sales and revenues improved by $2.9 million over the prior year quarter with
the product cost-to-revenue ratio moving to 1.09-to-1.00 in the first quarter of 2011 from
1.41-to-1.00 in the first quarter of 2010. Results reflect improved product margins combined with
lower commissioning and warranty costs compared to the first quarter of 2010.
Total product sales and service backlog as of January 31, 2011 was $159.2 million compared to $84.1
million as of January 31, 2010. Product order backlog was $78.9 million and $58.3 million as of
January 31, 2011 and 2010, respectively. Backlog for long-term service agreements was $80.3
million and $25.8 million as of January 31, 2011 and 2010, respectively.
Research and development contract revenue was $2.3 million for the first quarter of 2011 compared
to $1.8 million for the first quarter of 2010. The Company’s research and development backlog
totaled $7.9 million as of January 31, 2011 compared to $11.9 million as of January 31, 2010,
decreasing as phase two of the solid oxide fuel cell development contract with the U.S. Department
of Energy (DOE) nears successful completion. The Company submitted a
proposal to the DOE to participate in the multi-year third phase of the solid oxide fuel cell
development program.
FuelCell Energy FIRST Quarter 2011 Results
Net loss to common shareholders for the first quarter of 2011 improved to $11.7 million, or
$0.10 per basic and diluted share, compared to $15.4 million or $0.18 per basic and diluted share
in the first quarter of 2010. Higher product margins drove this improvement.
Total cash, cash equivalents and investments in U.S. Treasuries were $70.2 million as of January
31, 2011. Net use of cash, cash equivalents, and investments for the first quarter was $3.2
million compared to net use of $7.2 million in the first quarter of 2010, excluding the net
proceeds of $17.8 million from the registered direct offering of common stock and revolver
borrowings of $1.0 million. The favorable impact of improved product margins combined with strong
cash receipts from U.S. orders resulted in lower cash utilization during the first quarter of 2011
compared to the prior year quarter. Capital spending for the first quarter was $0.3 million and
depreciation expense was $1.6 million.
Corporate Highlights
“Solid financial results this quarter, including the favorable impact of product cost reductions
combined with growing revenue and production volume, highlight the progress being made,” said Chip
Bottone, President and CEO of FuelCell Energy, Inc. “The FuelCell team is focusing on three key
areas including, revenue growth, customer satisfaction and operational excellence as we expand our
markets. Our products are helping our customers solve their power generation and environmental
challenges as well as helping them meet their sustainability goals.”
Market Activity
FuelCell Energy is a world leader in the development and production of stationary fuel cells.
Direct FuelCell (DFC®) power plants are generating power at more than 50 locations globally and
have cumulatively generated over 700 million kilowatt hours (kWh) of clean power. Key geographic
and vertical markets are driving sales of DFC power plants.
California: Our products address the need by utilities for ultra-clean baseload distributed
generation. During the first quarter of 2011, Southern California Edison ordered a 1.4 MW DFC1500
to be installed at California State University, San Bernardino. This order follows previous
authorization by the California Public Utilities Commission (CPUC) for Southern California Edison
and Pacific Gas & Electric to pursue utility owned fuel cell installations. The CPUC recognizes
fuel cells as preferred distributed generation resources due to clean natural gas and renewable
baseload power generation that lessens reliance on the electrical transmission grid and represents
incremental capacity that avoids or reduces investment in the transmission and distribution system.
Universities represent an attractive market for DFC power plants due to the virtual lack of
pollutants that helps universities reach their sustainability goals combined with on-site power
generation that enhances energy security. California State University, San Bernardino will be the
fifth California university with a DFC power plant, representing eight megawatts in total power
generation capacity.
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FuelCell Energy FIRST Quarter 2011 Results
United Kingdom: The Crown Estates ordered a DFC power plant during the first quarter of 2011 for
installation in central London, England. The ultra-clean emission profile of the DFC plant
combined with reduced greenhouse gas emissions support the sustainability goals of The Crown
Estates and were the primary drivers for the order. This order represents the first DFC power
plant sold by the Company in the United Kingdom.
The British government recently issued a series of proposals to address aggressive climate targets
while balancing the need for replacing a significant portion of existing power generation that is
nearing the end of its functional lifespan. Estimates are that about a quarter of the existing
power generation capacity in the UK will need to be replaced by 2020. Fuel cells operating on
natural gas or renewable biogas are a compelling solution for the needs of the British power market
as they provide ultra-clean and efficient baseload power.
South Korea: At the end of December 2010, the South Korean Ministry of Knowledge Economy confirmed
the Renewable Portfolio Standard (RPS) and established the pricing mechanism for new & renewable
(NRE) power under the mandates of the RPS. Utilities and independent power producers in South
Korea are expected to purchase NRE power generation plants now that the pricing mechanics of the
RPS have been confirmed. Penalties for non-compliance are expected to encourage conformance with
the RPS. Fuel cells operating on natural gas and renewable biogas earned a prominent position
within the pricing mechanism and are expected to represent a significant portion of NRE purchasing
as the clean, efficient and distributed generation attributes of fuel cells meet the needs of
utilities and the requirements of the RPS.
Responding to this market opportunity, POSCO Power continues to expand its clean power generation
business using the Company’s fuel cell technology. POSCO Power has begun production at their 100
MW fuel cell module assembly facility using fuel cell components manufactured at FuelCell Energy’s
production facility and will provide balance-of-plant (BOP) for the South Korean market from their
existing 100 MW BOP facility. Announcement of the RPS pricing mechanism, combined with the recent
completion of local capacity for fuel cell module assembly, is expected to drive their next order
for fuel cell components.
Production
Production levels are currently at 35 MW annually compared to production of 22 MW for 2010 to meet
backlog. Anticipating increasing order volume, the Company expects to further increase production
levels during 2011.
Advanced Technology Programs
DFC hydrogen generation: The DFC300-H2 power plant installed at the Orange County Wastewater
treatment facility has begun to produce hydrogen for vehicle refueling along with ultra-clean
electricity and high quality heat used for the wastewater treatment process. The plant is
operating on natural gas and is expected to begin operating on renewable biogas in the next
few months. The demonstration is being performed under sub-contract to Air Products and Chemicals,
Inc, with the majority of funding provided by the U.S. Department of Energy (DOE).
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FuelCell Energy FIRST Quarter 2011 Results
Solid Oxide Fuel Cell Development: The Company continues to partner with Versa Power Systems Inc.,
for the development of a Large Scale Coal-Based Solid Oxide Fuel Cell under the U.S. Department of
Energy Solid State Energy Conversion Alliance (SECA) Program. The FuelCell Energy/Versa team met
cost and performance objectives for a minimum 25 kW fuel cell stack in phase two of the program.
Conference Call Information
FuelCell Energy will host a conference call with investors beginning at 10:00 a.m. Eastern Time on
March 10, 2011 to discuss the first quarter 2011 results.
Participants can access the live call via webcast on the Company website or by telephone as
follows:
| • | The live webcast of this call will be available on the Company website at www.fuelcellenergy.com. To listen to the call, select ‘Investors’ on the home page, then click on ‘events & presentations’ and then click on ‘Listen to the webcast’ | ||
| • | Alternatively, participants in the U.S. or Canada can dial 877-303-7005 | ||
| • | Outside the U.S. and Canada, please call 678-809-1045 | ||
| • | The passcode is ‘FuelCell Energy’ |
The webcast of the conference call will be archived on the Company’s Investors’ page at
www.fuelcellenergy.com. Alternatively, the replay of the conference call will be available
approximately two hours after the conclusion of the call until midnight Eastern Time on Wednesday,
March 16, 2011:
| • | From the U.S. and Canada please dial 800-642-1687 | ||
| • | Outside the U.S. or Canada please call 706-645-9291 | ||
| • | Enter confirmation code 46585555 |
About FuelCell Energy
DFC® fuel cells are generating power at over 50 locations worldwide. The Company’s power plants
have generated over 700 million kWh of power using a variety of fuels including renewable
wastewater gas, biogas from beer and food processing, as well as natural gas and other hydrocarbon
fuels. FuelCell Energy has partnerships with major power plant developers and power companies
around the world. The Company also receives funding from the U.S. Department of Energy and other
government agencies for the development of leading edge technologies such as fuel cells. For more
information please visit our website at www.fuelcellenergy.com
This news release contains forward-looking statements, including statements regarding the
Company’s plans and expectations regarding the continuing development, commercialization and
financing of its fuel cell technology and business plans. All forward-looking statements are
subject to risks and uncertainties that could cause actual results to differ materially from those
projected. Factors that could cause such a difference include, without limitation, general risks
associated with product development, manufacturing, changes in the regulatory environment, customer
strategies, changes in critical accounting policies, potential volatility of energy prices, rapid
technological change, competition, and the Company’s ability to achieve its sales plans and cost
reduction targets, as well as other risks set forth in the Company’s filings with the Securities
and Exchange Commission. The forward-looking statements contained herein speak only as of the date of this press release. The Company
expressly disclaims any obligation or undertaking to release publicly any updates or revisions to
any such statement to reflect any change in the Company’s expectations or any change in events,
conditions or circumstances on which any such statement is based.
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FuelCell Energy FIRST Quarter 2011 Results
Direct FuelCell, DFC, DFC/T, DFC-H2 and FuelCell Energy, Inc. are all registered trademarks of
FuelCell Energy, Inc. DFC-ERG is a registered trademark jointly owned by Enbridge, Inc. and
FuelCell Energy, Inc.
Contact:
FuelCell Energy, Inc.
Kurt Goddard, Vice President Investor Relations
203-830-7494
ir@fce.com
Kurt Goddard, Vice President Investor Relations
203-830-7494
ir@fce.com
####
Page 5
FuelCell Energy FIRST Quarter 2011 Results
FUELCELL ENERGY, INC.
Consolidated Balance Sheets
(Unaudited)
(Amounts in thousands, except share and per share amounts)
Consolidated Balance Sheets
(Unaudited)
(Amounts in thousands, except share and per share amounts)
| January 31, | October 31, | |||||||
| 2011 | 2010 | |||||||
ASSETS |
||||||||
Current assets: |
||||||||
Cash and cash equivalents |
$ | 26,085 | $ | 20,467 | ||||
Investments — U.S. treasury securities |
39,537 | 25,019 | ||||||
Accounts receivable, net |
23,288 | 18,066 | ||||||
Inventories, net |
32,352 | 33,404 | ||||||
Other current assets |
6,343 | 5,253 | ||||||
Total current assets |
127,605 | 102,209 | ||||||
Property, plant and equipment, net |
25,391 | 26,679 | ||||||
Investments — U.S. treasury securities |
4,529 | 9,071 | ||||||
Investment in and loans to affiliate |
9,653 | 9,837 | ||||||
Other assets, net |
3,494 | 2,733 | ||||||
Total assets |
$ | 170,672 | $ | 150,529 | ||||
LIABILITIES AND EQUITY |
||||||||
Current liabilities: |
||||||||
Current portion of long-term debt and other liabilities |
$ | 1,998 | $ | 976 | ||||
Accounts payable |
10,065 | 10,267 | ||||||
Accounts payable due to affiliate |
407 | 575 | ||||||
Accrued liabilities |
15,819 | 16,721 | ||||||
Deferred revenue |
37,902 | 25,499 | ||||||
Total current liabilities |
66,191 | 54,038 | ||||||
Long-term deferred revenue |
7,750 | 8,042 | ||||||
Long-term debt and other liabilities |
4,112 | 4,056 | ||||||
Total liabilities |
78,053 | 66,136 | ||||||
Redeemable preferred stock of subsidiary |
17,374 | 16,849 | ||||||
Redeemable preferred stock (liquidation preference of
$64,020 at January 31, 2011 and October 31, 2010) |
59,857 | 59,857 | ||||||
Total Equity: |
||||||||
Shareholders’ equity |
||||||||
Common stock ($.0001 par value); 150,000,000
shares authorized; 123,633,555 and 112,965,725
shares issued and outstanding at January 31,
2011 and October 31, 2010, respectively. |
12 | 11 | ||||||
Additional paid-in capital |
682,656 | 663,951 | ||||||
Accumulated deficit |
(666,561 | ) | (655,623 | ) | ||||
Accumulated other comprehensive income (loss) |
13 | 11 | ||||||
Treasury stock, Common, at cost (5,679 shares at
January 31, 2011 and October 31, 2010) |
(53 | ) | (53 | ) | ||||
Deferred compensation |
53 | 53 | ||||||
Total shareholders’ equity |
16,120 | 8,350 | ||||||
Noncontrolling interest in subsidiaries |
(732 | ) | (663 | ) | ||||
Total equity |
15,388 | 7,687 | ||||||
Total liabilities and equity |
$ | 170,672 | $ | 150,529 | ||||
Page 6
FuelCell Energy FIRST Quarter 2011 Results
FUELCELL ENERGY, INC.
Consolidated Statements of Operations
(Unaudited)
(Amounts in thousands, except share and per share amounts)
Consolidated Statements of Operations
(Unaudited)
(Amounts in thousands, except share and per share amounts)
| Three Months Ended | ||||||||
| January 31, | ||||||||
| 2011 | 2010 | |||||||
Revenues: |
||||||||
Product sales and revenues |
$ | 25,760 | $ | 12,808 | ||||
Research and development contracts |
2,320 | 1,808 | ||||||
Total revenues |
28,080 | 14,616 | ||||||
Costs and expenses: |
||||||||
Cost of product sales and revenues |
28,059 | 18,013 | ||||||
Cost of research and development contracts |
2,337 | 2,096 | ||||||
Administrative and selling expenses |
4,050 | 4,156 | ||||||
Research and development expenses |
4,246 | 4,620 | ||||||
Total costs and expenses |
38,692 | 28,885 | ||||||
Loss from operations |
(10,612 | ) | (14,269 | ) | ||||
Interest expense |
(54 | ) | (63 | ) | ||||
Loss from equity investment |
(198 | ) | (148 | ) | ||||
Interest and other income, net |
400 | 319 | ||||||
Loss before redeemable preferred stock of subsidiary |
(10,464 | ) | (14,161 | ) | ||||
Accretion of redeemable preferred stock of subsidiary |
(525 | ) | (557 | ) | ||||
Loss before provision for income taxes |
(10,989 | ) | (14,718 | ) | ||||
Provision for income taxes |
(18 | ) | — | |||||
Net loss |
(11,007 | ) | (14,718 | ) | ||||
Net loss attributable to noncontrolling interest |
69 | 86 | ||||||
Net loss attributable to FuelCell Energy, Inc. |
(10,938 | ) | (14,632 | ) | ||||
Preferred stock dividends |
(800 | ) | (802 | ) | ||||
Net loss to common shareholders |
$ | (11,738 | ) | $ | (15,434 | ) | ||
Net loss per share to common shareholders |
||||||||
Basic |
$ | (0.10 | ) | $ | (0.18 | ) | ||
Diluted |
$ | (0.10 | ) | $ | (0.18 | ) | ||
Weighted average shares outstanding |
||||||||
Basic |
115,086,014 | 84,401,558 | ||||||
Diluted |
115,086,014 | 84,401,558 | ||||||
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