Slide 1: Q2 2018 Results Conference Call
Q2 2018 Results Conference Call August 2, 2018 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 • Q2 results in-line with expectations o Revenue $26.4M, flat year-over- year o Gross Margin 36% o Adjusted EBITDA ($0.8)M o Record Order Backlog at end-Q2 Power to Change the World® 4 BALLARD.COM
Slide 5: FCEV Addressable Market
FCEV Addressable Market 10,000 Weight (tons) Bio & (H2-based) synthetic fuels Passenger Ships Planes 1,000 FCEV – Fuel Cell Trains & Trams Electric Vehicles Bubble size 100 Heavy Trucks representing the relative annual energy consumption City Buses of this vehicle Light type in 2013 10 Commercial Ve
Slide 6: Q2 Bus Update
Q2 Bus Update • Purchase order received from Van Hool for 40 FCveloCity® 85kW modules to power buses in Germany under JIVE program • Ballard-powered El Dorado Axess bus successfully completed testing in Altoona, PA …. now qualifies for FTA funded programs with deployment of 5+ buses Power to Change
Slide 7: Q2 Marine Update
Q2 Marine Update • MOU signed with ABB for development of megawatt (MW) scale PEM fuel cell systems o Initial focus on powering cruise ship hotel operations while at port • Ballard Europe in consortium to design & build HySeas III fuel cell passenger and car ferry o Ferry to be powered by Ballard o
Slide 8: Q2 Auto Update
Q2 Auto Update • Long-term HyMotion contract extension signed with Audi AG, member of Volkswagen Group o 3½ years, to August 2022 o Value of $62-100M • Validation of Ballard’s capabilities from world’s largest automotive OEM • Reflects Volkswagen’s commitment to fuel cells as the auto industry under
Slide 9: Q2 Update – Other Light-Duty Motive
Q2 Update – Other Light-Duty Motive • Providing Hyster-Yale with air-cooled fuel cell stacks for Class 3 forklift trucks • U.S. Navy order for 13 fuel cell propulsion systems to power UAVs • Collaborating with Cellula Robotics on long range underwater autonomous vehicle Power to Change the World® 9
Slide 10: Q2 China Update
Q2 China Update • Measured progress towards fuel cell commercialization • Developments on government regulations & subsidies that support fuel cell adoption • Planned build-out of hydrogen stations Power to Change the World® 10 BALLARD.COM
Slide 11: Capacity Expansion
Capacity Expansion • Acquired certain strategic assets of AFCC, expanding Ballard capacity to meet growth needs over next 5-years o Assets are currently co-located at Ballard HQ in Vancouver • High value & capital efficient transaction, given cost of equivalent new equipment Power to Change the Worl
Slide 12: LCS Product
LCS Product • Targets for next-gen liquid-cooled fuel cell stack: o ~33% greater power density o More than 2x planned operating lifetime o Improved tolerances to low humidity and higher temperature o Improved freeze start capability • Launch planned for 2019 Power to Change the World® 12 BALLARD.COM
Slide 13: Next-Gen Module
Next-Gen Module • Targets for 8th generation power module: o 40% volume reduction o 30% weight reduction o 50% fewer components o More than 2x planned operating lifetime o Improved freeze start capability • Expected cost reduction of >40% • Launch planned for 2019 Power to Change the World® 13 BALLA
Slide 14: Q2 & YTD Revenue and Gross Margin
Q2 & YTD Revenue and Gross Margin REVENUE $49.2M GROSS MARGIN $46.5M 2018 36% 38% 35% 34% 2017 $26.5M $26.4M Q2 YTD Q2 YTD • Q2 2018 Revenue flat at $26.4M • Q2 2018 Gross Margin +1-point, to 36% o +18% Power Products, to $17.8M o Improvement reflects revenue mix +9% Heavy Duty Motive, to $13.3M
Slide 15: Q2 & YTD Cash Operating Cost Base and Adjusted EBITDA
Q2 & YTD Cash Operating Cost Base and Adjusted EBITDA CASH OPERATING COST BASE * ADJUSTED EBITDA # $21.2M $18.4M Q2 YTD $1.0M 2018 $0.4M 2017 $10.5M ($0.8)M $8.5M ($4.6)M Q2 YTD • Q2 2018 Cash Operating Costs +24%, to $10.5M • Q2 2018: o Due to higher investment in technology and o Adjusted EBITDA (
Slide 16: Liquidity
Liquidity • Q2 2018 Cash Used By Operating Activities increased to ($16.9)M o Working capital increase reflects higher Accounts Receivable related to timing of revenue, and inventory build-up in anticipation of second half 2018 deliveries $68.1M • End-Q2 2018 cash reserves of $35.2M, $35.2M down fro
Slide 17: Order Backlog
Order Backlog End-Q2 2018: Order Backlog1 of $283.3M and 12-Month Order Book2 of $96.0M ORDER Order Backlog Orders Received Orders Delivered Order Backlog BACKLOG at End-Q1 2018 in Q2 2018 in Q2 2018 at End-Q2 2018 Total Fuel Cell $222.0M $87.7M $26.4M $283.3M Products & Services 1 Order Backlog = a
Slide 18: Q&A
Q&A Power to Change the World® 18 BALLARD.COM
Slide 19: Power to Change the World ®
Power to Change the World® 19 BALLARD.COM