Slide 1: Q4 2017
Q4 2017 Jon André Løkke Chief Executive Officer
Slide 2: Forward-looking information
Forward-looking information Nel ASA Q4 2017 This Presentation includes and is based, inter alia, on forward-looking expectations will be achieved or that the actual results will be as set information and statements that are subject to risks and uncertainties out in the Presentation. Nel ASA is makin
Slide 3: Nel ASA Q4 2017 agenda
Nel ASA Q4 2017 • Q4 highlights • Global market update • Nel in brief & segment updates - Nel Hydrogen Electrolyser - Nel Hydrogen Fueling - Nel Hydrogen Solutions • Nel strategic ambitions • Summary/Outlook • Appendix: Q4 financials
Slide 4: Q4 Highlights
Q4 Highlights Nel ASA Q4 2017 • Financial results and financing • Revenues of 111.9 MNOK in Q4’17, up from 50.6 MNOK in Q4’16 • Revenue growth largely due to the acquisition of Proton Onsite – underlying organic growth (ex. Proton) of around 40% in FY’17 • Cash-balance of 295 MNOK at end of Q4’17, p
Slide 5: Financial highlights
Financial highlights Nel ASA Q4 2017 Q4 Highlights 2017 2017 2017 2017 2017 2016 2016 2016 2016 (NOK million) Q4 Adj* Q4 Q3 Q2 Q1 Q4 Q3 Q2 Q1 Operating revenue 111.9 111.9 111.7 39.1 35.7 50.6 24.4 13.5 26.0 Total operating costs 155.4 155.4 145.0 63.9 51.3 66.6 37.1 29.9 36.1 EBITDA -11.1 -27.7 -18
Slide 6: Ramp-up/non-recurring items/option cost - negatively impacting EBITDA
Ramp-up/non-recurring items/option cost - negatively impacting EBITDA Nel ASA Q4 2017 Q4 Highlights Ramp-up cost and other non-recurring items* Non-cash cost related to stock options** MNOK MNOK Close to 30 MNOK for Close to 20 MNOK for 10,0 10,0 the full-year 2017 the full-year 2017 8,0 8,0 6,0 6,0
Slide 7: Solid backlog
Solid backlog Nel ASA Q4 2017 Q4 Highlights • Orders received in Q4 ended at >110 MNOK Order backlog development in 2017 • Only includes firm PO’s with agreed price/volume/Terms & Conditions MNOK 500 • Current order backlog ~465 MNOK 450 • Main orders contributing to backlog in Q4’17: 400 • Demo sta
Slide 8: Significant increase in hydrogen market activities
Significant increase in hydrogen market activities Nel ASA Q4 2017 Q4 Highlights • Nel experiences a significant increase Increasing market activities, value of budget offers submitted in market related activities Total value of budget offers 10,0 • Total value of offers amounted to 9,0 ~10 BNOK in
Slide 9: General market update
nel: General market update
Slide 10: Global hydrogen market
Global hydrogen market Nel ASA Q4 2017 General market update Large opportunities for electrolysis within the already existing hydrogen market • ~55 million ton/year market (~150 BUSD) Global hydrogen market, by end-use: • 15% merchant market (5 – 15 $/kg) • 85% on-site (~2$/kg) • Only 1% from water
Slide 11: Overall hydrogen market set to grow 10x by 2050
Overall hydrogen market set to grow 10x by 2050 Nel ASA Q4 2017 General market update If high share of renewables, electrolysis market ... and an IEA study confirms the can potentially grow >1000x... competitiveness of renewable hydrogen Report authored by the Hydrogen Council, consisting of senior
Slide 12: Electrolysers outcompeting fossil alternatives
Electrolysers outcompeting fossil alternatives Nel ASA Q4 2017 General market update CapEx: Electrolysers from Nel - becoming OpEx: Renewable energy already enables competitive with SMR fossil parity for hydrogen $/kW Offshore wind 4,9 6,0 Cost split of H2/Kg 7,3 1,8 3,0 Onshore wind 5,0 1,8 SMR – C
Slide 13: Current markets served by electrolyzers
Current markets served by electrolyzers Nel ASA Q4 2017 General market update Food Industry Glass Industry Polysilicon Industry Laboratories Transport Sector Chemical Industry Steel Industry Power-To-X Power Industry Life support (renewable hydrogen) Historical market New markets 13
Slide 14: New markets, Power-To-X
New markets, Power-To-X Nel ASA Q4 2017 General market update Unparalleled position of electrolysis in producing other green energy forms POWER-TO-PIPELINE (GAS) POWER-TO-FUEL (TRANSPORT) • Hydrogen from electrolysis will be key in producing large quantities POWER-TO-POWER (ENERGY STORAGE) of sustai
Slide 15: Hydrogen is becoming relevant in all forms of transportation
Hydrogen is becoming relevant in all forms of transportation Nel ASA Q4 2017 General market update hydrogen solutions 15
Slide 16: Recent survey increases the importance of hydrogen as a fuel
Recent survey increases the importance of hydrogen as a fuel Nel ASA Q4 2017 General market update Fuel cell electric mobility is now the #1 trend until 2025 “There will not be a single solitary drivetrain technology: Executives project a split by 2040 for BEVs (26%), FCEVs (25%), ICEs (25%) and hyb
Slide 17: Nel in brief & segment updates
Nel in brief & segment updates 17
Slide 18: Nel ASA
Nel ASA Nel ASA Q4 2017 • Global, listed, pure-play hydrogen company – facilities in Norway, Denmark and the U.S. • Significant foothold in fast-growing markets with several breakthrough contracts • World-leading on hydrogen electrolyzers and fueling equipment – unrivalled performance and track-reco
Slide 19: Nel Hydrogen Electrolyser
Nel Hydrogen Electrolyser Nel Hydrogen Electrolyser Production and installation of water electrolysers for hydrogen production • Global leader in hydrogen prod. plants - highest uptime, lowest conversion cost, robust and reliable • >3500 hydrogen solutions delivered in >80 countries world wide since
Slide 20: Awarded 2.3 MUSD order for U.S. and U.K. Navy Electrolyzer Stacks
Awarded 2.3 MUSD order for U.S. and U.K. Navy Electrolyzer Stacks Nel ASA Q4 2017 Nel Hydrogen Electrolyser Proton PEM electrolyzers from Nel delivering life support oxygen for submarines • Received PO from United Technologies Aerospace Systems for electrolyzer cell stacks for U.S. and U.K. submarin
Slide 21: World's largest power-to-gas project planned for France
World’s largest power-to-gas project planned for France Nel ASA Q4 2017 Nel Hydrogen Electrolyser 700 MW electrolyzer plant for power-to-gas in Northern France Dunkerque gas terminal • Exclusive, industrial-scale power-to-gas framework agreement • Still working on final agreements for initial 200MW
Slide 22: Clustering concept enables a step-up in cost-efficiency
Clustering concept enables a step-up in cost-efficiency Nel ASA Q4 2017 NEL Hydrogen Elecrolyser Each electrolyzer needs … but with the clustering concept, eight its own infrastructure… electrolyzers can share plant infrastructure x40 Compressor system Plant support system ~100MW plant, initial cont
Slide 23: Nel Hydrogen Fueling
Nel Hydrogen Fueling Nel Hydrogen Fueling Production of hydrogen fueling stations for cars, buses, trucks, forklifts and other applications • Global leader within hydrogen fueling solutions for Dispenser assembly 5-stage H2Station® assembly vehicles, adapted to latest fueling standards • Delivered >
Slide 24: Nel Hydrogen Solutions
Nel Hydrogen Solutions Nel Hydrogen Solutions Established to utilize market opportunities across the Nel group and offers complete solutions to customers • Unified delivery of complex renewable hydrogen solutions, efficient system integration, project development and sales across segments • Only pro
Slide 25: Additional support from Enova to Uno-X Hydrogen fueling stations
Additional support from Enova to Uno-X Hydrogen fueling stations Nel ASA Q4 2017 Nel Hydrogen Solutions 20 MNOK support for establishment of 2 additional fueling stations in Akershus in 2018 • Uno-X Hydrogen received support to establish 2 new hydrogen fueling stations in Ås & Hvam, Akershus • After
Slide 26: Awarded contract for combined fueling solution in Estonia
Awarded contract for combined fueling solution in Estonia Nel ASA Q4 2017 Nel Hydrogen Solutions Received PO of 4.5 MEUR from NT Bene in Estonia • Combined solution with PEM electrolyzer and H2Station® will have hydrogen capacity of >400 kg/day • To be installed in Pärnu, Estonia, where it will serv
Slide 27: Awarded contract for hydrogen fueling station by SSAB
Awarded contract for hydrogen fueling station by SSAB Nel ASA Q4 2017 Nel Hydrogen Solutions H2Station® fueling solution for fueling of very large fork lifts • Contract with SSAB EMEA AB, Sweden for leasing arrangement of a H2Station® • The H2Station® will be installed at SSABs site in Oxelösund, Sw
Slide 28: Delivering mega-scale hydrogen fueling stations for Nikola
Delivering mega-scale hydrogen fueling stations for Nikola Nel ASA Q4 2017 Nel Hydrogen Solutions Entered into exclusive partnership with Nikola Motor • Sole equipment supplier to create the largest hydrogen fueling network in the world • 14 mega-scale stations covering 2000 miles & up to 450 ton/da
Slide 29: Nikola: Two demo stations with installation start in H2'18, order of 3.6 MUSD
Nikola: Two demo stations with installation start in H2’18, order of 3.6 MUSD Nel ASA Q4 2017 Nel Hydrogen Solutions ● Reviewing potential demo-route from plant in Arizona, will support Nikola prototype truck fleet ● Equipment for onsite production and fueling of 70MPa ● 2 Alkaline electrolyzer stac
Slide 30: Nikola: 14 commercial stations – from 8 to 32 ton/day at each site
Nikola: 14 commercial stations – from 8 to 32 ton/day at each site Nel ASA Q4 2017 Nel Hydrogen Solutions 8 ton/ day 32 ton/ day Cluster 8-Electrolyzer Low pressure Storage High pressure storage and dispensing 30
Slide 31: How to maintain leading cost position
How to maintain leading cost position 31
Slide 32: Successful commercial efforts in 2017 – towards capacity expansions/cost reductions
Successful commercial efforts in 2017 – towards capacity expansions/cost reductions Nel ASA Q4 2017 How to maintain leading cost position 2017 2018 Accelerated commercial activities Capacity expansions/cost reductions • Nel increased market related activities • Continue marketing efforts, and signif
Slide 33: Evaluating 10x capacity increase to maintain leading cost position
Evaluating 10x capacity increase to maintain leading cost position Nel ASA Q4 2017 How to maintain leading cost position Scaling production capacity by 10x puts Nel in first-mover/pole position for next growth cycle • Initial capacity extension from 25MW to 40MW completed at Available Capacity Scali
Slide 34: Expanding capacity from 25MW to 250MW, option to purchase building
Expanding capacity from 25MW to 250MW, option to purchase building Nel ASA Q4 2017 How to maintain leading cost position • Ideal scenario, can connect into existing infrastructure like; power supply, etc. • Construct new line in parallel with running production in existing facility 34
Slide 35: Summary/Outlook
nel: Summary/Outlook
Slide 36: Creating a rapidly growing billion NOK company
Creating a rapidly growing billion NOK company Nel ASA Q4 2017 Levering on the arising opportunities within energy storage and hydrogen fueling Global presence Technology leadership Strong financials Cost leadership Commercial capabilities Preferred partner 36
Slide 37: Outlook
Outlook Nel ASA Q4 2017 Nel ASA Nel Hydrogen Fueling • Order backlog of approximately 465 MNOK • Continued ramp-up of production capacity at the Herning • Cash balance of 295 MNOK at end of year, to support continued facility, good contract coverage for 2018 development • California installation- an
Slide 38: Q&A
nel: Q&A
Slide 39: Appendix: Profit and loss
Appendix: Profit and loss Nel ASA Q4 2017 2017 2016 2017 2016 (NOK million) Q4 Q4 Operating revenue 111.9 50.6 298.4 114.5 Operating costs 155.4 66.6 415.6 169.8 EBITDA -27.7 -13.1 -81.2 -44.9 EBIT -43.5 -16.0 -117.2 -55.3 Pre-tax profit -44.6 -24.1 -124.4 -62.6 Net profit 22.7 -18.5 -52.4 -55.8 Tot
Slide 40: Appendix: Balance sheet
Appendix: Balance sheet Nel ASA Q4 2017 2017 2016 (NOK million) Year-end Year-end Non-current assets 1,141.4 462.9 Current assets 584.3 300.0 -of which is cash and cash equivalents 295.0 225.5 Equity 1,409.4 671.2 Long term liabilities 102.4 26.1 Short term liabilities 213.9 65.6 Total balance 1,725
Slide 41: Appendix: Cash flow
Appendix: Cash flow Nel ASA Q4 2017 2017 2016 2017 2016 (NOK million) Q4 Q4 Pre-tax profit (loss) -44.6 -24.1 -124.4 -62.6 Net cash from operations 2.7 11.0 -113.0 -34.2 Net cash from investments -29.1 -9.2 -219.3 -60.2 Net cash from financing 235.9 -0.0 401.8 6.8 Net change in cash and cash equival
Slide 42: Appendix: explanation of excess values and depreciation of identifiable intangible assets
Appendix: explanation of excess values and depreciation of identifiable intangible Nel ASA Q4 2017 assets arising from the PPA related to the acquisition of Proton Onsite Excess value Lifetime Depreciation per quarter (NOK million) Intangible assets: Technology 261.7 7 and 15 years 4.7 Customer rela
Slide 43: Number one by nature
nel: Number one by nature