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Exhibit 99.1

 

LOGO

FOR IMMEDIATE RELEASE

FuelCell Energy Reports Second Quarter Results and Business Highlights

 

   

Record quarterly revenue of $42 million

 

   

Annual production run-rate increased by 25 percent to 70 megawatts annually

 

   

Sale of 1.4 megawatt power plant for hospital application

 

   

Construction of multi-megawatt fuel cell parks on track in Connecticut and South Korea

DANBURY, CT – June 5, 2013 – FuelCell Energy, Inc. (Nasdaq: FCEL), a global leader in the design, manufacture, operation and service of ultra-clean, efficient and reliable fuel cell power plants, today reported results for its second quarter ended April 30, 2013 along with an update on key business highlights.

Financial Results

FuelCell Energy (the Company) reported total revenues for the second quarter of 2013 of $42.4 million, an increase of 75 percent when compared to total revenues of $24.2 million for the second quarter of 2012.

Product sales for the second quarter of 2013 totaled $34.4 million including $29.3 million of fuel cell kits and power plants, and $5.1 million of power plant component sales and installation services. For the comparable prior year period, product sales totaled $18.7 million including $14.3 million of fuel cell kits and power plants and $4.4 million of power plant component sales and installation services. The increase year-over-year reflects higher fuel cell kit sales combined with revenue from the Bridgeport fuel cell park project of approximately $8.9 million. The Company increased its production rate during the second quarter of 2013 at the Torrington, Connecticut manufacturing facility, reaching an annual run-rate of 70 megawatts (MW) effective May 1, 2013.

Service and license revenues for the second quarter of 2013 totaled $4.1 million compared to $3.5 million for the comparable prior year period.

Advanced technologies contract revenue was $4.0 million for the second quarter of 2013 compared to $2.0 million for the second quarter of 2012 with the increase primarily due to solid oxide fuel cell development programs, particularly the unmanned aerial program with Boeing resulting from the acquisition of Versa Power Systems in the first quarter of 2013.

Backlog totaled $410.0 million at April 30, 2013 compared to $181.4 million at April 30, 2012.

 

   

Product sales backlog was $238.1 million at April 30, 2013 compared to $89.3 million at April 30, 2012. The 122 MW fuel cell kit order by POSCO Energy in October 2012 and the 14.9 MW Bridgeport fuel cell park project account for the increase in product sales backlog year-over-year. Product backlog in megawatts totaled 139.5 MW at April 30, 2013 compared to 52.4 MW at April 30, 2012.


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 2

 

   

Service backlog was $157.8 million at April 30, 2013 compared to $78.4 million at April 30, 2012 with the addition of the Bridgeport fuel cell park service contract accounting for a significant portion of the growth year-over-year.

 

   

Advanced technologies contracts backlog was $14.1 million at April 30, 2013 compared to $13.8 million at April 30, 2012.

The gross profit generated in the second quarter of 2013 totaled $2.3 million compared to a gross profit of $0.2 million generated in the second quarter of 2012. The second quarter 2013 gross margin of 5.5 percent benefitted from a sales mix that included complete power plants and installation services along with fuel cell kits.

Loss from operations for the second quarter of 2013 was $7.2 million compared to $7.8 million for the second quarter of 2012. Administrative and selling expenses increased in the second quarter of 2013 compared to the second quarter of 2012, due to increased business development activity in the European market and fully consolidating Versa Power Systems.

Net loss to common shareholders for the second quarter of 2013 totaled $8.2 million, or $0.04 per basic and diluted share, compared to $9.1 million or $0.06 per basic and diluted share in the second quarter of 2012.

Year-to-Date 2013

For the six months ended April 30, 2013, the Company reported revenue of $78.8 million compared to $55.5 million for the prior year period. Product sales were $63.4 million compared to $44.8 million for the prior year period. Service agreement and license revenues were $9.1 million compared to $6.9 million for the prior year period. Advanced technologies contract revenues totaled $6.3 million, compared to $3.8 million for the prior year period.

For the six months ended April 30, 2013, the Company’s gross profit was approximately breakeven compared to a gross profit of $2.3 million for the six months ended April 30, 2012. A charge of approximately $2.1 million was incurred in the first quarter of 2013 related to a select number of fuel cell stacks requiring repair, which negatively impacted financial results for the six months ended April 30, 2013 compared to the prior year period.

Loss from operations for the six months ended April 30, 2013 was $18.3 million, compared to $13.2 million for the six months ended April 30, 2012. The change year-over-year includes the impact of increased business development activity in the USA and European markets and fully consolidating Versa Power Systems.

Net loss to common shareholders for the six months ended April 30, 2013 was $20.6 million or $0.11 per basic and diluted share, or $15.8 million or $0.11 per basic and diluted share for the prior year period.

Cash and cash equivalents

Total cash and cash equivalents and restricted cash was $71.7 million at April 30, 2013. Net cash used in the quarter of $14.6 million consisted primarily of a use of working capital tied to the growth of the business and power plant construction activities.

During the quarter, the Company closed on a new long-term loan agreement with the Connecticut Clean Energy and Finance Investment Authority (CEFIA) totaling $5.9 million in support of the Bridgeport project. Advances under the loan agreement during the second quarter totaled $2.6 million partially off-setting working capital usage. Capital spending for the second quarter of 2013 was $1.2 million and depreciation expense was $1.0 million.


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 3

 

Business Highlights and Strategy Execution

Operations update

The annual production run-rate at the Torrington, Connecticut production facility was increased to 70 MW as of May 1, 2013 to meet backlog. The change in production levels represented an increase of 25 percent from the production levels of 56 MW annually maintained during the second quarter of 2013.

Engineering and assembly of fuel cell power plants commenced at the FuelCell Energy Solutions manufacturing facility in Germany during the second quarter of 2013.

Installations Update

“In conjunction with our customer, Dominion, we co-hosted a groundbreaking ceremony at the Bridgeport fuel cell park last month to showcase our clean and efficient product solutions to government officials and the local community and to say that the project is on schedule and on budget,” said Chip Bottone, President and Chief Executive Officer, FuelCell Energy, Inc.

The first two fuel cell modules have been delivered to the Bridgeport fuel cell park with subsequent deliveries scheduled during the summer and early fall. The inter-connection work to connect the fuel cell park to the electric grid via three substations is more than 90 percent complete. Module manufacturing and conditioning is on schedule and the fuel cell park is expected to deliver full power by the end of calendar year 2013.

Construction of the 59 MW fuel cell park in Hwasung City, South Korea by POSCO Energy continues to progress with twelve of the 2.8 MW DFC3000 power plants on site and the remaining nine plants to be delivered during the summer and early fall. Commissioning has begun for the initial power plant installations. The fuel cell park will be brought to full power by the end of 2013 or early 2014.

In Europe, the fuel cell power plant purchased by The Crown Estate and installed inside the Regent Street mixed-use office/residential/retail complex in central London, England is undergoing commissioning. Construction of both the 20 Fenchurch office tower in London and the Federal Ministry of Education and Research government complex in Berlin, Germany is progressing. The fuel cell power plant for the Berlin installation is being assembled at the FuelCell Energy Solutions manufacturing facility in Germany.

Market Update

“I am very encouraged about the order outlook for our power plants based on customer discussions including utilities and on-site power users,” said Mr. Bottone, “Near-term order volume exists in California, Connecticut and New Jersey as well as Germany and potentially a few other European countries.”

A 1.4 MW DFC1500® power plant was sold during the second quarter of 2013 for installation at a hospital in Hartford, Connecticut. The power plant will be configured for combined heat and power with the heat being supplied to both the hospital and a nearby school. Clean, quiet and modest space requirements enable placement of FuelCell Energy power plants in urban locations such as next to hospitals. The project is part of the State of Connecticut Low-emission Renewable Energy Credit (LREC) program.

The Company has approximately 18 megawatts of approved projects under the Connecticut Project 150 program. Legislation was recently approved that extended the required start-date of these projects by 24 months. The required start dates now range from May 2015 to September 2015. Construction of the Bridgeport fuel cell park, a CT150 project, and the associated job creation supported the extension request. The Company is seeking project investors to purchase and own the power plants. Similar to the Bridgeport fuel cell park, the Company is developing the projects, will provide the fuel cell power plants, and expects to provide installation/Engineering, Procurement and Construction (EPC) services, and then operate and maintain the plants over the term of the power purchase agreement.


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 4

 

Cautionary Language

This news release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, statements with respect to the Company’s anticipated financial results and 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, changes to projected deliveries and order flow, changes to production rate and product costs, general risks associated with product development, manufacturing, changes in the regulatory environment, customer strategies, unanticipated manufacturing issues that impact power plant performance, 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.

About FuelCell Energy

Direct FuelCell® power plants are generating ultra-clean, efficient and reliable power at more than 50 locations worldwide. With more than 300 megawatts of power generation capacity installed or in backlog, FuelCell Energy is a global leader in providing ultra-clean baseload distributed generation to utilities, industrial operations, universities, municipal water treatment facilities, government installations and other customers around the world. The Company’s power plants have generated more than 1.6 billion kilowatt hours of ultra-clean power using a variety of fuels including renewable biogas from wastewater treatment and food processing, as well as clean natural gas. For more information,

please visit www.fuelcellenergy.com

See us on YouTube

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.

Conference Call Information

FuelCell Energy management will host a conference call with investors beginning at 10:00 a.m. Eastern Time on June 6, 2013 to discuss the second quarter 2013 results. An accompanying slide presentation for the earnings call will be available at http://fcel.client.shareholder.com/events.cfm immediately prior to the call.

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


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 5

 

   

The passcode is ‘FuelCell Energy’

The webcast of the conference call will be available 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 June 9, 2013:

 

   

From the U.S. and Canada please dial 855-859-2056

 

   

Outside the U.S. or Canada please call 404-537-3406

 

   

Enter confirmation code 75510477

 

Contact:   

FuelCell Energy, Inc.

Kurt Goddard, Vice President Investor Relations

203-830-7494

ir@fce.com

# # # #


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 6

 

FUELCELL ENERGY, INC.

Consolidated Balance Sheets

(Unaudited)

(Amounts in thousands, except share and per share amounts)

 

     April 30,
2013
    October 31,
2012
 
ASSETS     

Current assets:

    

Cash and cash equivalents

   $ 56,039      $ 46,879   

Restricted cash and cash equivalents

     10,689        5,335   

License fee receivable

     —          10,000   

Accounts receivable, net

     29,393        25,984   

Inventories, net

     49,871        47,701   

Other current assets

     7,828        4,727   
  

 

 

   

 

 

 

Total current assets

     153,820        140,626   

Restricted cash and cash equivalents

     4,950        5,300   

Property, plant and equipment, net

     21,911        23,258   

Goodwill

     4,245        —     

Intangible assets

     9,592        —     

Investment in and loans to affiliate

     —          6,115   

Other assets, net

     12,968        16,186   
  

 

 

   

 

 

 

Total assets

   $ 207,486      $ 191,485   
  

 

 

   

 

 

 
LIABILITIES AND EQUITY     

Current liabilities:

    

Current portion of long-term debt

   $ 4,410      $ 5,161   

Accounts payable

     19,563        12,254   

Accounts payable due to affiliate

     —          203   

Accrued liabilities

     19,706        20,265   

Deferred revenue

     60,207        45,939   

Preferred stock obligation of subsidiary

     1,060        1,075   
  

 

 

   

 

 

 

Total current liabilities

     104,946        84,897   

Long-term deferred revenue

     20,980        15,533   

Long-term preferred stock obligation of subsidiary

     13,292        13,095   

Long-term debt and other liabilities

     10,985        3,975   
  

 

 

   

 

 

 

Total liabilities

     150,203        117,500   
  

 

 

   

 

 

 

Redeemable preferred stock (liquidation preference of $64,020 at April 30, 2013 and October 31, 2012)

     59,857        59,857   

Total equity:

    

Shareholders’ (deficit) equity

    

Common stock ($.0001 par value; 275,000,000 shares authorized; 191,936,178 and 185,856,123 shares issued and outstanding at April 30, 2013 and October 31, 2012, respectively)

     19        18   

Additional paid-in capital

     753,477        751,256   

Accumulated deficit

     (755,876     (736,831

Accumulated other comprehensive income

     87        66   

Treasury stock, Common, at cost (5,679 shares at April 30, 2013 and October 31, 2012)

     (53     (53

Deferred compensation

     53        53   
  

 

 

   

 

 

 

Total shareholders’ (deficit) equity

     (2,293     14,509   

Noncontrolling interest in subsidiaries

     (281     (381
  

 

 

   

 

 

 

Total (deficit) equity

     (2,574     14,128   
  

 

 

   

 

 

 

Total liabilities and equity

   $ 207,486      $ 191,485   
  

 

 

   

 

 

 


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 7

 

FUELCELL ENERGY, INC.

Consolidated Statements of Operations

(unaudited)

(Amounts in thousands, except share and per share amounts)

 

     Three Months Ended
April 30,
 
     2013     2012  

Revenues:

    

Product sales

   $ 34,375      $ 18,657   

Service agreement and license revenues

     4,108        3,454   

Advanced technologies contract revenues

     3,953        2,042   
  

 

 

   

 

 

 

Total revenues

     42,436        24,153   
  

 

 

   

 

 

 

Costs of revenues:

    

Cost of product sales

     32,483        18,139   

Cost of service agreement revenues

     3,904        3,942   

Cost of advanced technologies contract revenues

     3,735        1,871   
  

 

 

   

 

 

 

Total cost of revenues

     40,122        23,952   
  

 

 

   

 

 

 

Gross profit

     2,314        201   

Operating expenses:

    

Administrative and selling expenses

     5,436        4,002   

Research and development expenses

     4,075        3,956   
  

 

 

   

 

 

 

Total operating expenses

     9,511        7,958   
  

 

 

   

 

 

 

Loss from operations

     (7,197     (7,757

Interest expense

     (574     (575

Loss from equity investment

     —          (150

License fee and royalty income

     —          412   

Other income (expense), net

     177        (414
  

 

 

   

 

 

 

Loss before (provision) benefit for income taxes

     (7,594     (8,484

(Provision) benefit for income taxes

     (35     121   
  

 

 

   

 

 

 

Net loss

     (7,629     (8,363

Net loss attributable to noncontrolling interest

     264        71   
  

 

 

   

 

 

 

Net loss attributable to FuelCell Energy, Inc.

     (7,365     (8,292

Preferred stock dividends

     (800     (801
  

 

 

   

 

 

 

Net loss to common shareholders

   $ (8,165   $ (9,093
  

 

 

   

 

 

 

Loss per share basic and diluted

    

Basic

   $ (0.04   $ (0.06

Diluted

   $ (0.04   $ (0.06

Weighted average shares outstanding

    

Basic

     190,431,554        150,013,074   

Diluted

     190,431,554        150,013,074   


FUELCELL ENERGY SECOND QUARTER 2013 RESULTS    PAGE 8

 

FUELCELL ENERGY, INC.

Consolidated Statements of Operations

(unaudited)

(Amounts in thousands, except share and per share amounts)

 

     Six Months Ended
April 30,
 
     2013     2012  

Revenues:

    

Product sales

   $ 63,440      $ 44,859   

Service agreement and license revenues

     9,077        6,852   

Advanced technologies contract revenues

     6,277        3,779   
  

 

 

   

 

 

 

Total revenues

     78,794        55,490   
  

 

 

   

 

 

 

Costs of revenues:

    

Cost of product sales

     62,427        41,499   

Cost of service agreement revenues

     10,389        8,242   

Cost of advanced technologies contract revenues

     5,975        3,444   
  

 

 

   

 

 

 

Total cost of revenues

     78,791        53,185   
  

 

 

   

 

 

 

Gross profit

     3        2,305   

Operating expenses:

    

Administrative and selling expenses

     10,868        7,766   

Research and development expenses

     7,402        7,739   
  

 

 

   

 

 

 

Total operating expenses

     18,270        15,505   
  

 

 

   

 

 

 

Loss from operations

     (18,267     (13,200

Interest expense

     (1,140     (1,205

Income (loss) from equity investment

     46        (512

License fee and royalty income

     —          836   

Other income (expense), net

     (105     (218
  

 

 

   

 

 

 

Loss before provision for income taxes

     (19,466     (14,299

Provision for income taxes

     (42     (78
  

 

 

   

 

 

 

Net loss

     (19,508     (14,377

Net loss attributable to noncontrolling interest

     462        142   
  

 

 

   

 

 

 

Net loss attributable to FuelCell Energy, Inc.

     (19,046     (14,235

Preferred stock dividends

     (1,600     (1,601
  

 

 

   

 

 

 

Net loss to common shareholders

   $ (20,646   $ (15,836
  

 

 

   

 

 

 

Loss per share basic and diluted

    

Basic

   $ (0.11   $ (0.11

Diluted

   $ (0.11   $ (0.11

Weighted average shares outstanding

    

Basic

     188,968,577        144,830,437   

Diluted

     188,968,577        144,830,437