Ballard Power Systems Inc. · TSX:BLDP
Ballard Power Systems — Q1 2014 Earnings Presentation
22 slides from Ballard Power Systems's earnings presentation, Apr 29, 2014
Slide 1: Q1 2014 Conference Call
® NASDAQ:BLDP TSX:BLD Q1 2014 Conference Call April 29, 2014
Slide 2: Forward Looking Statements
Forward Looking Statements NASDAQ:BLDP TSX:BLD This presentation contains forward-looking statements, including: estimated revenue; cash operating costs; gross margins; product cost reductions; adjusted EBITDA; liquidity; market size and growth projections; customer value propositions; and expecte
Slide 3: Progress Continued in Q1
Progress Continued in Q1* NASDAQ:BLDP TSX:BLD • Revenue o +13%, to $14.0M • Gross Margin o +1-point, to 25% • Cash Operating Costs o +23% improvement, to $6.3M • Adjusted EBITDA o +60% improvement, to ($1.8)M • Cash Reserves o $41.6M * All comparisons are to Q1 2013 3
Slide 4: Strategic IP Transaction With United Technologies Corp.
Strategic IP Transaction With United Technologies Corp. NASDAQ:BLDP TSX:BLD Ballard Acquires UTC PEM Fuel Cell IP Portfolio (closed April 24th) • What Ballard has acquired – o PEM fuel cell technology in automotive, bus & stationary power o ~800 patents and patent applications o Hundreds of invent
Slide 5: Strategic IP Transaction With United Technologies Corp. (Cont'd)
Strategic IP Transaction With United Technologies Corp. (Cont’d) NASDAQ:BLDP TSX:BLD Ballard & UTC Form Strategic Alliance • UTC is ‘goal-aligned’ with Ballard and has financial incentives o UTC is a strategic investor in Ballard (with 5.1M common shares) o UTC will benefit from royalty payments o
Slide 6: Q1 Revenue Breakdown
Q1 Revenue Breakdown* NASDAQ:BLDP TSX:BLD • Fuel Cell Products o Telecom Backup Power Revenue -55%, to $2.9M … reflecting unevenness in early stage market demand o Material Handling Revenue +125%, to $2.0M • Engineering Services o Revenue +185%, to $7.4M • IP Licensing o $1.6M revenue related
Slide 7: Revenue and Gross Margin
Revenue and Gross Margin NASDAQ:BLDP TSX:BLD Revenue (millions) Gross Margin (%) 90 30 Guidance ~$80.0M 80 25 27% 70 25% 60 $55.8 20 $61.3 50 15 17% 40 $43.7 13% 30 $37.7 10 20 5 10 Q1 $14.0 0 0 2011 2012 2013 2014 YTD 2011 2012 2013 2014 YTD Fuel Cell Products Contract Manufacturing* • 2014 Q1 +1
Slide 8: Cash Operating Cost Base and Adjusted EBITDA
Cash Operating Cost Base and Adjusted EBITDA NASDAQ:BLDP TSX:BLD Cash Operating Cost Base* (millions) Adjusted EBITDA* (millions) 2011 2012 2013 2014 YTD 0 Guidance 45 ~Break-even Q1 40 ($1.8) -5 35 $37.0 ($8.2) 30 -10 $30.3 25 $28.3 ~$20 – 24M -15 20 15 -20 ($22.1) 10 5 Q1 -25 ($27.9) $6.3 0 2011
Slide 9: Liquidity
Liquidity NASDAQ:BLDP TSX:BLD • Q1 Cash Used By Operating Activities improved +5%, to ($6.6)M o Expect full-year cash use ~$10M • Strengthened balance sheet by adding ~$18M to cash position in Q1 o Primarily due to the exercise of warrants that were issued with 2013 equity financings • End-Q1 cash
Slide 10: 2014 Guidance
2014 Guidance NASDAQ:BLDP TSX:BLD • Confirming full-year guidance for – o Revenue growth of approximately 30% o Approximately break-even Adjusted EBITDA 10
Slide 11: Product Sales – Telecom Backup Power
Product Sales – Telecom Backup Power NASDAQ:BLDP TSX:BLD • Uneven demand in Q1, but full-year outlook remains bullish • Significant opportunities in sales pipeline for additional penetration in current markets o Japan, Indonesia, Philippines, South Africa • Important signs of progress in new marke
Slide 12: Product Sales – Material Handling
Product Sales – Material Handling NASDAQ:BLDP TSX:BLD • Strong Q1 results o Revenue +125%, to $2.0M consistent with Plug Power’s recent business update Ballard FCvelocity®-9SSL Ballard FCgen®-1020ACS • Growth in Plug Power order book Fuel Cell Stack Fuel Cell Stack o Demonstrated by multi-site W
Slide 13: Product Sales – Development Stage Markets
Product Sales – Development Stage Markets NASDAQ:BLDP TSX:BLD • Primary focus of Development Stage Markets is on Continuous Power and Bus o Trial of Ballard’s Continuous Power prototype system in rural South African community to begin in May o Launch of next generation FCvelocity™- HD7 power modul
Slide 14: Engineering Services
Engineering Services NASDAQ:BLDP TSX:BLD • Strong performance continued in Q1 o Revenue +185%, to $7.4M • Underpinned by 4-year contract with Volkswagen, signed in March 2013 • Smaller-scale contracts signed in Q1 o Development of new cathode layer o Development and testing of power Ballard develo
Slide 15: IP Licensing
IP Licensing NASDAQ:BLDP TSX:BLD • Q1 revenue $1.6M from multi-year Bus module assembly agreement in China • Acquisition of UTC’s PEM IP portfolio creates opportunities for incremental Licensing revenue and – o Expands Engineering Services capabilities o Accelerates Fuel Cell Product market penetr
Slide 16: Appendix
NASDAQ:BLDP TSX:BLD Appendix 16
Slide 17: Who We Are
Who We Are NASDAQ:BLDP TSX:BLD • Ballard is the global leader in clean energy proton exchange membrane (“PEM”) fuel cell products and services … design, manufacturing & deployment o Telecom Backup Power 2,500 systems … 9MW’s of power o Material Handling 4,500 stacks … 10M hours of runtime o En
Slide 18: Q1 2014 Results
Q1 2014 Results NASDAQ:BLDP TSX:BLD (Millions of U.S. dollars) Three months ended March 31, 2014 2013 % Improvement GROWTH Fuel Cell Product & Service Revenue: Telecom Backup Power $2.9 $6.4 -55% Material Handling $2.0 $0.9 125% Engineering Services $7.4 $2.6 185% Development Stage Markets $1.7 $2
Slide 19: Strategic Direction
Strategic Direction NASDAQ:BLDP TSX:BLD • Aggressively building shareholder value through: • Leveraging product leadership and Product Sales early mover position in Telecom Backup Power & Material Handling Engineering • Anchored by 4-year contract with Volkswagen utilizing industry-leading Service
Slide 20: Fuel Cell Product Portfolio
Fuel Cell Product Portfolio NASDAQ:BLDP TSX:BLD Fuel Cell Stacks • 500W-2kW • 2-8kW • 4-20kW • 100kW • Up to 8k hrs • Up to 30k hrs • Up to 12k hrs • > 5k hrs Fuel Cell Modules • 75-150kW • Up to 20k hours Complete • 2kW & 5kW Fuel Cell • Direct hydrogen • 2.5kW & 5kW • Methanol fuelled Systems •
Slide 21: Telecom Backup Power – Addressable Market
Telecom Backup Power – Addressable Market NASDAQ:BLDP TSX:BLD • TAM calculation for telecom backup power includes: • New network rollouts • Replacement of incumbent technology at end of life or for network upgrade • Grid connected sites *Small Cell BTS sites excluded from calculation • To determin
Slide 22: Material Handling – Addressable Market
Material Handling – Addressable Market NASDAQ:BLDP TSX:BLD • TAM calculation for material handling includes: • Industrial battery-powered forklift sales • Value for stack sales only • North American market only • To determine SAM calculation the following factors were considered: • Trucks used in
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