Ballard Power Systems Inc. · TSX:BLDP
Ballard Power Systems — FY2019 Earnings Presentation
26 slides from Ballard Power Systems's earnings presentation, Mar 5, 2020
Slide 1: Q4 & Full Year 2019 Results Conference Call
Q4 & Full Year 2019 Results Conference Call March 5, 2020 Nasdaq & TSX Ticker: BLDP Power to Change the World® 1 BALLARD.COM
Slide 2: Conference Call Participants
Conference Call Participants Randy MacEwen President & CEO Tony Guglielmin CFO Power to Change the World® 2 BALLARD.COM
Slide 3: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements, including: estimated revenue; gross margin; cash operating costs; adjusted EBITDA; product cost reductions; liquidity; market size and growth projections; customer value propositions; and expected sales and product shi
Slide 4: Overview
Overview • Record quarterly revenue of $41.9M in Q4 2019 • Full year 2019: o $106.3M revenue exceeded outlook o 21% gross margin o ($28.2)M Adjusted EBITDA o $147.8M end-2019 cash reserves o $110.3M end-2019 12-month order book • Full-year 2020 outlook for top-line growth in revenue to approximately
Slide 5: New Government Policy Initiatives
1 New Government Policy Initiatives • 66 countries announced net-zero emission targets by 2050 • 18 governments – representing 70% of global GDP – now have hydrogen roadmaps • Energy Ministerial “10-10-10” target set • EU target of 30% reduction in class 8 truck emissions by 2030; apply to buses in
Slide 6: Investments in the Fuel Cell Sector
2 Investments in the Fuel Cell Sector • Weichai Power investment & JV with Ballard • Bosch licensing deal with PowerCell • Cummins acquisition of Hydrogenics • CNH International partnership with Nikola • Michelin and Faurecia’s Symbio JV $6.7 Billion Investment • Hyundai planning $6.7B investment in
Slide 7: Perspective on Fuel Cell Commercialization
3 Perspective on Fuel Cell Commercialization • Consolidated industry view fuel cells offer a strong value proposition for Heavy- and Medium-Duty Motive applications • FCEVs uniquely address requirements for heavy payloads, extended range & rapid refueling o Including for buses, commercial trucks,
Slide 8: Power to Change the World ®
Power to Change the World® 8 BALLARD.COM
Slide 9: Power to Change the World ®
Power to Change the World® 9 BALLARD.COM
Slide 10: Power to Change the World ®
Power to Change the World® 10 BALLARD.COM
Slide 11: Key Conclusions – TCO for commercial FCEVs will decline >50% within 10-years
Key Conclusions – • TCO for commercial FCEVs will decline >50% within 10-years • FCEVs will be less expensive than BEVs and ICE vehicles in a number of use cases by 2027, without subsidies Power to Change the World® 11 BALLARD.COM
Slide 12: Fuel Cell Orders & Deployments
4 Fuel Cell Orders & Deployments • Increasing number of FCEV orders and deployments in key geographies globally • Currently ~18,000 fuel cell passenger cars in operation – supported by ~400 hydrogen fueling stations – primarily in California, Japan, South Korea, Germany • There has been significant
Slide 13: Fuel Cell Orders & Deployments - China
Fuel Cell Orders & Deployments - China • 2019 production of ~3,000 FCEVs …. cumulative total of ~6,300 o Ballard technology inside ~50%, with 2.1M km’s of on-road experience • 44 hydrogen stations in service, 41 under construction • Phase I of the Gaoming Tram Line in Foshan City now in operation, w
Slide 14: Fuel Cell Orders & Deployments - EU
Fuel Cell Orders & Deployments - EU • 20 FCEBs deployed in 2019; Ballard now powering 56 FCEBs in revenue service o Includes 8 Van Hool tram-buses in service in Pau, France • 2019 orders for 67 Ballard modules for buses • H2Bus Consortium announced, with goal of 1,000 FCEBs & H2 infrastructure by 20
Slide 15: Fuel Cell Orders & Deployments - EU (Cont’d)
Fuel Cell Orders & Deployments - EU (Cont’d) • Emerging demand from marine sector o Order for 3 x 200kW modules for ELEKTRA push boat in Germany o Collaboration with ABB using 2 x 200kW for push boat in France o ESA with Norled for 2 x 100kW modules to power ferry in Norway o H2Ports consortium • Es
Slide 16: Fuel Cell Orders & Deployments – CA
Fuel Cell Orders & Deployments – CA • Ballard powering 36 FCEBs in California o 14 with SunLine; 11 with OCTA; 10 with AC Transit; 1 with UC- Irvine • Demonstration programs continuing with UPS and Kenworth • Globally Ballard has now powered Heavy- and Medium-Duty Motive vehicles more than 30M km’s
Slide 17: Fuel Cell Advancement & Cost Reduction
5 Fuel Cell Advancement & Cost Reduction • Ballard product cost reductions of 65% over past 10-years • 2019 launch of next-gen LCS fuel cell stack and FCmoveTM power module o 35% lifecycle cost reduction over prior generation module o Technology advancements o Deeper value proposition • Expect furth
Slide 18: ESG – Environmental, Social & Governance
6 ESG – Environmental, Social & Governance • ESG is an important and growing trend in the financial sector o Likely to drive significant capital reallocations • Ballard has expanded priority and focus on ESG in the 2019 Annual Report o Expecting to enhance and evolve ESG reporting over time Power to
Slide 19: Emerging Market Applications
Emerging Market Applications • Anglo American order for 9 x 100kW modules to power 290-ton Ultra-class mining truck • Product Development Agreement with Hydrogene de France for multi-MW scale stationary power system • ESAs with adKor and SFC Energy for 500 x FCgen®-1020 stacks to power backup system
Slide 20: Ongoing Investment
Ongoing Investment • Ballard continuing to invest in key areas: o Talent o Competencies o Innovation o Intellectual property o Technology o Product enhancements o Product cost reduction o Advanced manufacturing o Customer experience • Focusing on market share, high growth, improving financials and s
Slide 21: Q4 & FY Revenue and Gross Margin
Q4 & FY Revenue and Gross Margin REVENUE GROSS MARGIN $106.3M $96.6M 31% 2019 25% 2018 21% 21% $41.9M $28.5M Q4 Full Year Q4 Full Year • Q4 2019 Revenue +47%, to $41.9M • Q4 2019 Gross Margin -4-points, to 21% o +63% Power Products, to $25.5M o Reflects a shift in revenue and product +101% Heavy D
Slide 22: Q4 & FY Cash Operating Cost Base and Adjusted EBITDA
Q4 & FY Cash Operating Cost Base and Adjusted EBITDA CASH OPERATING COST BASE * ADJUSTED EBITDA # $43.0M Q4 Full Year $40.6M 2019 2018 ($5.2)M ($7.4)M Q4 share of losses in joint venture $13.6M investments in China of ($3.0)M ($13.5)M $11.2M Full Year share of losses in joint venture investments in
Slide 23: Liquidity
Liquidity • Q4 2019 Cash Provided By Operating Activities improved to $4.1M o Reflects cash operating losses of ($3.9) million and capital inflows of $8.0 million • End-Q4 2019 cash reserves of $147.8M, $192.2M down $5.6M from the prior quarter $147.8M • Planning to launch $75M ATM (At-The- Market)
Slide 24: Order Backlog
Order Backlog End-Q4 2019: Order Backlog1 of $178.7M and 12-Month Order Book2 of $110.3M ORDER Order Backlog Orders Received Orders Delivered Order Backlog BACKLOG at End-Q3 2019 in Q4 2019 in Q4 2019 at End-Q4 2019 Total Fuel Cell $199.6M $21.0M $41.9M $178.7M Products & Services 1 Order Backlog =
Slide 25: Q&A
Q&A Power to Change the World® 25 BALLARD.COM
Slide 26: Power to Change the World ®
Power to Change the World® 26 BALLARD.COM