Ballard Power Systems Inc. · TSX:BLDP
Ballard Power Systems — Investor Presentation (May 2005)
56 slides from Ballard Power Systems's investor presentation, May 2005
Slide 1: Ballard Power Systems May 2005
Bz du a / power to change the world* / BALLARD’ — May 2005
Slide 2: Forward-looking statements
BALLARD POWER SYSTEMS INC. May 2005 This presentation contains forward-looking statements that are based on the beliefs of Ballard’s management and reflect Ballard’s current expectations as contemplated under section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities an
Slide 3: Ballard Power Systems
Ballard Power Systems world-leading proton exchange membrane fuel cell design, development and manufacturer 1875 patents granted/pending, ~ 830 distinct inventions ~ 975 employees Ballard Power Systems $81.4 million revenue in 2004 global HQ: Burnaby BC industry-leading cash position: $260
Slide 4: Ballard's Track Record of Accomplishments
Ballard’s Track Record of Accomplishments forms Vehicular Fuel Cell Alliance builds world’s first powers PEM fuel cell introduces Nexa®, world’s first manufacturing world’s first fuel cell zero facility commercial fuel emission bus cell module 1993 1994 1997 1998 1999 2000 2001 2003 2004 powers accu
Slide 5: Ballard's Product Portfolio
Ballard’s Product Portfolio Transportation Mk 902 Electric Drive Train Fuel Cell Module Power Generation 1kW Combined Nexa Power Conversion Heat and Power Power Module Electronics Generator (Japan) Carbon Fiber Products Carbon Fabric / Carbon Fiber Friction Materials Paper
Slide 6: Forces Driving Fuel Cell Adoption
Forces Driving Fuel Cell Adoption air quality global warming energy security environmental concerns market long-term energy dynamics supply government policies and investment initiatives
Slide 7: Ballard's Strategy for Success
Ballard’s Strategy for Success technology PEM fuel cell acceleration focus on markets characterized by: high volume potential, design, field demonstrations strong socioeconomic forces, development government support and and product development funding development manufacture primary markets: a
Slide 8: Innovation and technology advancement
Ballard Power Systems innovation and technology advancement
Slide 9: Innovation and Technology Advancement
Innovation and Technology Advancement cost reductions improved power density improved reliability reduced parts count manufacturability 80 kW 50 kW 25 kW 10 kW 5 kW Mk 9 Mk 8 Mk 7 Mk 5 Mk 3
Slide 10: Ballard's 2004 Technology Hat Trick
Ballard’s 2004 Technology “Hat Trick” Ballard achieved significant improvements in three key fuel cell stack performance metrics – in a single stack design… cost reduction freeze start durability reduced platinum performed demonstrated loading to multiple freeze stack lifetime of 0.7 mg/cm2 st
Slide 11: Technology Trendlines for Commercial Success
Technology Trendlines for Commercial Success Cost reduction US DOE target of USD 30/kWnet equivalent for the stack Freeze start ICE-equivalence, fuel cell cars need to start in all weather conditions Durability user expectation that fuel cell engines will last 5,000 hours Power density
Slide 12: 2005 - Technology Leadership Goal Definition
2005 - Technology Leadership Goal Definition Demonstrate an advanced technology stack that is on the path to a commercially-viable ICE equivalent with the following key attributes: Cost reduction (USD/kW net): 85* * Cost targets are based on DOE volume targets ~ 500,000 Power density (Wnet/L): 1
Slide 13: Cost
Fuet CELL STACK COST @, 150 fe z < = ° “ ° ” > T 2002 T 2003 | 2004 T 200s | 2006 | 2007 | 2008 | 2009 T| High-volume cost model assumes production @ Actual Cost to Date of 500,000 units/year O Projected Target Cost/Range WV 2010 US Doe Target - $30/kW Net for fuel cell stack BALLARD’ power to chang
Slide 14: Freeze Start
Freeze Start Fuet CELL STACK FREEZE START CAPABILITY « > ° a # ° ° = i re =] « < “ T 2002 T 2003 | 2004 | 2005 | 2006 | 2007 | 2008 | 2009 | 2010 US poe Target - Fuel cell system start-up @ Achieved Start-Up Time at -15°C in 30 sec to 90% power at -20°C Achieved Start-Up Time at -20°C Projected Targ
Slide 15: Durability
Durability FUEL CELL STACK DURABILITY « > ° x = “ < w = f°" @ 700 eo” @ 200 z00z | 2003 | 2004 | 200s | 2006 | 2007 | 2008 | 2009 | 2010 @ Actual Hours Achieved O Projected Target Hours/Range VY 2010 US Doe Target - 5000 Hours BALLARD’ power to change the world*
Slide 16: Stack Power Density
Stack Power Density Fuet CELL STACK POWER DENSITY Ewo OF Lire z < ES T2003 T 2004 T 2005 | 2006 | 2007 | 2008 | 2009 | 2010 System Net Power/Stack Module Volume @ Achieved Watts Net O Projected Target Watts Net/Range V 2010 US Doe Target - 2000 Watts Net/Liter BALLARD’ power to change the world*
Slide 17: Innovation and Technology Advancement: Hour of Operation
Innovation and Technology Advancement 100% 1400% 90% 1200% 80% 1000% Hour of Operation 70% USD per Stack 60% 800% 50% 600% 40% 30% 400% 20% 200% 10% 0% 0% 1999 2000 2001 2002 2003 1999 2000 2001 2002 2003 total product cost has stack operating lifetime decreased by 80 % has increased tenfold
Slide 18: Innovation and Technology Advancement: End-to-End Yields
Innovation and Technology Advancement 100% 100% 90% 90% 80% 80% End-to-End Yields 70% 70% Hour per Stack 60% 60% 50% 50% 40% 40% 30% 30% 20% 20% 10% 10% 0% 0% 1999 2000 2001 2002 2003 1999 2000 2001 2002 2003 material input utilization number of man hours to has doubled produce a Mk 9 stack has decr
Slide 19: Transportation
Ballard Power Systems transportation Ballard is powering more fuel cell vehicles today than anyone else – real-world experience for next-generation technology
Slide 20: Supplier to the World's Top Automakers
Supplier to the World’s Top Automakers Ballard has supplied eight of the top 10 automakers with fuel cell products or technology: 1. General Motors 6. PSA Peugeot-Citroen 2. Toyota 7. Hyundai 3. Ford 8. Nissan 4. Volkswagen/Audi 9. Honda 5. DaimlerChrysler 10. Renault Through 2005, Ballard customers
Slide 21: The Fuel Cell Vehicle: Simply a Better Car
The Fuel Cell Vehicle: Simply a Better Car zero emissions energy efficient improved drive-ability fewer moving parts increased reliability low noise and vibration packaging flexibility abundant on-board power superior weight distribution
Slide 22: Out of the Lab… on to the Road
Out of the Lab… on to the Road 1,300,000 kilometers real-world customers real-world driving conditions revenue service more on-road experience than any other fuel cell developer
Slide 23: European Fuel Cell Bus Project
European Fuel Cell Bus Project 10 cities 30 Ballard-powered buses running in revenue service more than a million passengers excellent fuel cell performance and availability
Slide 24: Fuel Cell Bus: California, China and Australia
Fuel Cell Bus: California, China and Australia 3 buses entered revenue 3 buses entered service in Perth, Australia in revenue service in September 2004 Santa Clara, California in February 2005 3 buses scheduled to begin revenue service in Beijing in 2005
Slide 25: California and British Columbia Hydrogen Highways
California and British Columbia Hydrogen Highways Prime Minister Paul Martin
Slide 26: Transportation: Fuel Cell Vehicle Adoption
Transportation: Fuel Cell Vehicle Adoption 2008 - 2012 - mass today - market 2012 2014 2007 customer customer initial limited commercial fleet demos fleets production availability about 500 central more fueling commercial vehicles fueling stations infrastructure 50% plus CARB: 2,
Slide 27: Hydrogen Infrastructure
Hydrogen Infrastructure infrastructure will keep pace with vehicle volume today about 200 vehicles – about 80 fueling stations estimated cost to build hydrogen infrastructure for North America between $12 billion (GM) and $19 billion (Shell) The petroleum industry currently spends $11 billion
Slide 28: Power generation
Ballard Power Systems power generation
Slide 29: Ballard Power Systems
Ballard Power Systems Ballard has a flexible power generation platform that allows it to pursue both Japanese co-generation and an OEM strategy
Slide 30: Co-Generation: Field Trials
Co-Generation:Field Trials ~ 110 stacks delivered to date 60 units in field trials during 2004 more than 160,000 field hours accumulated longest running stack – 10,600 hours PCMW4 System Residential Installation, Osaka Ballard fuel cell stack
Slide 31: The Japanese 1 kilowatt Co-Generation market
The Japanese 1 kilowatt Co-Generation market large potential market size – 16 million homes attached to city gas (Tokyo Gas, Osaka Gas and Toho Gas) – 1.2 million new homes constructed each year high energy costs – price point required is around $3,000 – $5,000 per kilowatt customer demand g
Slide 32: Co-Generation: Typical Installation
Co-Generation: Typical Installation natural gas steam reformation to generate hydrogen fuel cell generates first kilowatt of power for home heat produced by fuel cell provides ALL hot water for home
Slide 33: Co-Generation: Operation Concept
Co-Generation: Operation Concept fuel cell operation matches fuel cell operation matches electrical demand typical energy demand hot water demand “continuous operation” of Japanese house “daily start stop” electricity from the grid electricity electricity 6500kWhr/yr 6,500kWhr/yr electricity 4,100kW
Slide 34: Co-Generation: Value Proposition
Co-Generation: Value Proposition value proposition to home owner Typical Cogen Hot water demand kW hr/yr 5200 5200 electric company Eff. of hot water production % 0.85 0.56 reaction Gas demand for hot water MMBtu/yr 20.88 31.69 revenue will decrease Elec. demand - from grid kW hr/yr 6500 2400 by 6
Slide 35: Co-Generation: Roadmap
Co-Generation:Roadmap FY 03 04 05 06 07 08 09 10 National Millennium PJ I Millennium PJ II (Deregulation and Project (Deregulation & Standardization) Standardization) Large Scale Monitoring Program Demonstration I Subsidization Stage 400 5000 systems Subsidy to end user Subsidy to Gas Company Tokyo
Slide 36: Power Generation: OEM Strategy
Power Generation: OEM Strategy Nexa® power module more than 600 sold since commercial launch in 2001
Slide 37: Financial results
Ballard Power Systems financial results
Slide 38: Quarterly Revenue
Quarterly Revenue 35 30 25 US$MM Engineering Services 20 15 10 Product Revenue 5 0 Q2 Q3 Q4 Q2 Q3 Q4 Q2 Q3 Q4 02 03 04 05 20 20 20 20 Q1 Q1 Q1 Q1
Slide 39: Quarterly Operating Expenses
Quarterly Operating Expenses 60 50 40 US$MM 30 20 10 0 2 3 4 5 2 3 4 2 3 4 2 3 4 00 00 00 00 Q Q Q Q Q Q Q Q Q 2 2 2 2 1 1 1 1 Q Q Q Q Operating expenses include R&D, G&A and S&M
Slide 40: Quarterly Cash Consumption
Quarterly Cash Consumption 60 50 40 US$MM 30 20 10 0 Q1 Q3 Q1 Q3 Q1 Q3 Q1 2002 2003 2004 2005
Slide 41: Financial Resources and Commitments
Financial Resources and Commitments First Quarter ended March 31, 2005 (expressed in U.S. dollars) Cash & short-term investments $260 million
Slide 42: Path forward
Ballard Power Systems path forward
Slide 43: Ballard's 2005 Goals
Ballard’s 2005 Goals Achieve technology development milestones Demonstrate next generation automotive fuel cell stack technology that meets –25º Celsius, $85/kW, 2,000+ hours of durability Demonstrate next generation automotive fuel cell e-drive technology Demonstrate next generation co-gen
Slide 44: Ballard: Positioned for Success
Ballard: Positioned for Success leadership in fundamental understanding strong IP position state-of-the-art research facilities, design tools and accelerated test methods world’s most advance PEM fuel cell manufacturing plant more real-world experience than any other PEM fuel cell develope
Slide 45: Appendix
Ballard Power Systems appendix
Slide 46: Global Operations
Global Operations Vancouver, Canada Lowell, Massachusetts Stuttgart, Germany Tokyo, Japan EBARA BALLARD Sacramento, California California Fuel Cell Partnership Dearborn, Michigan
Slide 47: Growing Global Vehicle Demand
Growing Global Vehicle Demand 5 .5 5 .0 1996 4 .5 2050 Billio n s o f Ve h ic le s 4 .0 3 .5 3 .0 2 .5 2 .0 1 .5 1 .0 0 .5 0 .0 Industrialized Developing World Source: Fuel Cell Council Data Source: Fuel Cell Council
Slide 48: Hybrids: A Bridge to Fuel Cells
Hybrids: A Bridge to Fuel Cells Source: Fuel Cell Council Data Source: US DOE
Slide 49: Hybrids: A Bridge to Fuel Cells (cont'd)
Hybrids: A Bridge to Fuel Cells (cont’d) Well-to-Wheels GHGs (g/mi) 400 350 300 250 H2 from Natural Gas 200 150 100 H2 from Renewable Power 50 Source: Fuel Cell Council 0 ICE Hybrid Fuel Cell Fuel Cell Data Source: DOE
Slide 50: Hybrids: A Bridge to Fuel Cells (cont'd)
Hybrids: A Bridge to Fuel Cells (cont’d) Power train moving parts 150% 100% 50% 0% Source: Fuel Cell Council ICE Fuel Cell Hybrid Data Source: Ballard Power Systems
Slide 51: Hydrogen Infrastructure
Hydrogen Infrastructure Source: Fuel Cell Council
Slide 52: Hydrogen Infrastructure (cont'd)
Hydrogen Infrastructure (cont’d) Source: Fuel Cell Council
Slide 53: PEM Fuel Cell 101
PEM Fuel Cell 101 Fuel Cell Stack Single Fuel Cell Expanded Single Fuel Cell Flowfield Plate Hydrogen Membrane Air
Slide 54: Customers
Customers DAIMLERCHRYSLER Gort fifetorGompany, CILLIC CORPORATION Matsushita Electric Works M G E UPS SYSTEMS EvoBus a Premium Power a MITSUBISHI HONDA ae MOTORS @PHYUNOAI ~—.”W °° = SPIE... BGhydro & = == SANMINA-SCI BALLARD power to change the world*
Slide 55: Growing Supplier Base
Growing Supplier Base di A UPOND myn GRAFTECH me_PHi —21PRAXAIR Somencresy | <L JM ® BASF ‘9 Celanese Gave BALLARD power to change the world*
Slide 56: Integrated Management System
Integrated Management System “Ballard is one of the first companies in North America to certify a fully integrated management system (quality, environment, health and safety)” British Standards Institution - March 2003 ISO 9001 (Quality) ISO 14001 (Environment) OHSAS 18001 (Health & Safety)
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