Plug Power Inc. (NASDAQ:PLUG), a leader in providing energy
solutions that change the way the world moves, today announced its
financial results for the third quarter of 2016. Plug Power
continues to show growth and improvements in all areas of the
business during the third quarter, including:
- Total GAAP revenues of $17.6 million;
- 50% growth in recurring service and fuel delivery revenue
versus Q3 2015;
- Year-to-date bookings of $170 million with a full sales
pipeline driving confidence in full year target;
- GAAP gross margins of 2.2%, demonstrating strong improvement
versus Q3 2015;
- GAAP earnings per share (EPS) loss of $0.07 per share.
Beginning with this quarter, Plug Power’s
quarterly financial releases will no longer include the non-GAAP
measures of adjusted revenue, adjusted gross margin, adjusted
EBITDAS or adjusted EPS, to reflect the impact of deployed Power
Purchase Agreement (“PPA”) transactions under prior alternative
financing arrangements. Plug Power will continue to provide
supplemental information to all external stakeholders as it
believes it is important to convey the Company’s overall progress
in growth and cost downs and to maintain transparency.
Third quarter 2016 operational activity included
system deployments at three sites where the Company utilizes a
PPA. For those sites, the value of the systems deployed was
$17.3 million and the costs to deploy the systems was $11.5
million. In 2015, the Company financed PPA deployments under
arrangements which required revenue and cost recognition in the
period deployed, whereas the finance arrangements utilized in 2016
do not allow such revenue and cost recognition in the period.
Two new customers were signed in the third
quarter, along with continued progress expanding existing customers
including Walmart, Home Depot and Sysco. One of the new
customer sites was sold and implemented within the quarter, but
revenues from the sale will be recognized in the fourth quarter of
2016 due to the timing of the customer’s greenfield site
commissioning.
“Plug Power is executing on a balanced strategy
of delivering sustainable returns within the material handling
space while beginning to unearth new market opportunities to
maintain our position as a global market leader in fuel cell
technology,” said Andy Marsh, CEO of Plug Power. “Our third quarter
results underline continued improvement in our operating model,
with production and implementations on schedule, a robust and
growing sales pipeline, and continued margin expansion. Looking
ahead, we are encouraged at the immense long-term opportunity set
we see for our technology within motive power electric vehicle
applications worldwide.”
Financial Results
GAAP revenue for the third quarter of 2016 was
$17.6 million as compared to $31.4 million of revenue in the third
quarter of 2015. Third quarter 2016 revenue represents
expansion and growth from new and existing direct customers as well
as continued growth in PPA customer deployments.
Third quarter 2016 operational activity included
system deployments at three sites where the Company utilizes a PPA,
with the value of those systems totaling $17.3 million. In
2016 the Company is utilizing alternative financing arrangements
for its PPA deployments to improve liquidity and long-term customer
economics. The alternative financing requires different
accounting treatment as compared to the previous arrangements,
which required upfront revenue recognition of GenDrive shipments
and hydrogen infrastructure deployed.
Key metrics include:
- Cumulative GenDrive units deployed for the nine months ended
September 30, 2016 of 2,718, versus, 2,378 units for the same
period in 2015;
- GenKey sites installed for the nine months ended September 30
is 13, versus 11 for the same period in 2015;
- More than 11,000 GenDrive units are under service or PPA
contract at September 30, 2016, versus more than 7,500 under
service contract at September 30, 2015.
GAAP gross margin in the third quarter of 2016
was $381 thousand, or 2.2% of sales, as compared to GAAP gross
margin in third quarter 2015 of $76 thousand, or 0.2% of
sales. To provide additional visibility regarding Plug
Power’s progress on margin profile and cost downs, the value of PPA
systems deployed in the quarter was $17.3 million, with associated
equipment costs of $11.5 million. This quarter reflects the
ongoing progress Plug is making in leveraging its cost base to
significantly improve its margin profile.
Net loss attributable to common shareholders for
the third quarter of 2016 was $13.4 million, or $0.07 per share on
a diluted basis. This compares to a net loss attributable to
common shareholders in the third quarter of 2015 of $10.2 million,
or $0.06 per share on a diluted basis.
Cash and LiquidityNet cash used
in operating activities for the third quarter of 2016 and 2015 was
$13.9 million and $13.0 million, respectively. As of
September 30, 2016, Plug Power had total cash of $88.4 million,
including cash and cash equivalents of $42.5 million and restricted
cash of $45.9 million.
Conference CallPlug Power has
scheduled a conference call and webcast today at 8:30 am ET to
review the Company's results for the third quarter of 2016.
Interested parties are invited to listen to the
conference call by calling 877-465-1289. Online, the webcast can be
accessed at www.plugpower.com, by selecting the conference call
link on the home page, or directly
https://event.webcasts.com/starthere.jsp?ei=1123280. A playback of
the call will be available online for a period following the
event.
About Plug Power
Inc.
The architects of modern hydrogen and fuel cell technology, Plug
Power has revolutionized the industry with its simple GenKey
solution, elements of which are designed to increase productivity,
lower operating costs and reduce carbon footprints in a reliable,
cost-effective way. Plug Power’s GenKey solution couples together
all the necessary elements to power, fuel and serve a customer.
Plug Power is the partner that customers trust to take their
businesses into the future. For more information about Plug Power,
visit www.plugpower.com.
Safe Harbor
Statement This communication contains
"forward-looking statements" within the meaning of the Private
Securities Litigation Reform Act of 1995 that involve significant
risks and uncertainties about Plug Power Inc. ("PLUG"), including
but not limited to statements about PLUG's expectations regarding
revenue and margin and new market opportunities. You are cautioned
that such statements should not be read as a guarantee of future
performance or results, and will not necessarily be accurate
indications of the times that, or by which, such performance or
results will have been achieved. Such statements are subject to
risks and uncertainties that could cause actual performance or
results to differ materially from those expressed in these
statements. In particular, the risks and uncertainties include,
among other things, the risk that we continue to incur losses and
might never achieve or maintain profitability; the risk that we
will need to raise additional capital to fund our operations and
such capital may not be available to us; the risk that our lack of
extensive experience in manufacturing and marketing products may
impact our ability to manufacture and market products on a
profitable and large-scale commercial basis; the risk that unit
orders will not ship, be installed and/or converted to revenue, in
whole or in part; the risk that pending orders may not convert to
purchase orders, in whole or in part; the risk that a loss of one
or more of our major customers could result in a material adverse
effect on our financial condition; the risk that a sale of a
significant number of shares of stock could depress the market
price of our common stock; the risk that negative publicity related
to our business or stock could result in a negative impact on our
stock value and profitability; the risk of potential losses related
to any product liability claims or contract disputes; the risk of
loss related to an inability to maintain an effective system of
internal controls or key personnel; the risks related to use of
flammable fuels in our products; the cost and timing of developing,
marketing and selling our products and our ability to raise the
necessary capital to fund such costs; the ability to achieve the
forecasted gross margin on the sale of our products; the risk that
our actual net cash used for operating expenses may exceed the
projected net cash for operating expenses; the cost and
availability of fuel and fueling infrastructures for our products;
market acceptance of our products, including GenDrive, GenSure and
GenKey systems; the volatility of our stock price; our ability to
establish and maintain relationships with third parties with
respect to product development, manufacturing, distribution and
servicing and the supply of key product components; the cost and
availability of components and parts for our products; our ability
to develop commercially viable products; our ability to reduce
product and manufacturing costs; our ability to successfully expand
our product lines; our ability to successfully expand
internationally; our ability to improve system reliability for our
GenDrive, GenSure and GenKey systems; competitive factors, such as
price competition and competition from other traditional and
alternative energy companies; our ability to protect our
intellectual property; the cost of complying with current and
future federal, state and international governmental regulations;
risks associated with potential future acquisitions; and other
risks and uncertainties referenced in our public filings with the
Securities and Exchange Commission (the “SEC”). For additional
disclosure regarding these and other risks faced by PLUG, see
disclosures contained in PLUG's public filings with the SEC
including, the "Risk Factors" section of PLUG's Annual Report on
Form 10-K for the year ended December 31, 2015. You should consider
these factors in evaluating the forward-looking statements included
in this presentation and not place undue reliance on such
statements. The forward-looking statements are made as of the date
hereof, and PLUG undertakes no obligation to update such statements
as a result of new information.
Plug Power Inc. |
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Selected Financial Data |
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(Dollars in 000's except per share amounts) |
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|
|
|
|
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|
|
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For the three months ended September 30, |
|
For the nine months ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
Revenue: |
|
|
|
|
|
|
|
|
Sales of fuel cell systems and
related infrastructure |
$ |
5,653 |
|
|
$ |
24,777 |
|
|
$ |
19,992 |
|
|
$ |
48,530 |
|
|
Services performed on fuel cell
systems and related infrastructure |
|
4,763 |
|
|
|
3,555 |
|
|
|
15,396 |
|
|
|
9,083 |
|
|
Power Purchase Agreements |
|
3,858 |
|
|
|
1,546 |
|
|
|
9,626 |
|
|
|
3,600 |
|
|
Fuel delivered to customers |
|
2,909 |
|
|
|
1,544 |
|
|
|
7,557 |
|
|
|
3,331 |
|
|
Other |
|
376 |
|
|
|
10 |
|
|
|
779 |
|
|
|
313 |
|
|
Total revenue |
$ |
17,559 |
|
|
$ |
31,432 |
|
|
$ |
53,350 |
|
|
$ |
64,857 |
|
|
Gross profit
(loss): |
|
|
|
|
|
|
|
|
Sales of fuel cell systems and
related infrastructure |
$ |
1,412 |
|
|
$ |
2,506 |
|
|
$ |
3,810 |
|
|
$ |
6,427 |
|
|
Services performed on fuel cell
systems and related infrastructure |
|
282 |
|
|
|
(1,955 |
) |
|
|
(794 |
) |
|
|
(6,565 |
) |
|
Provision for loss contracts
related to service |
|
- |
|
|
|
- |
|
|
|
1,071 |
|
|
|
- |
|
|
Power Purchase Agreements |
|
(606 |
) |
|
|
129 |
|
|
|
(1,335 |
) |
|
|
499 |
|
|
Fuel delivered to customers |
|
(770 |
) |
|
|
(604 |
) |
|
|
(1,741 |
) |
|
|
(776 |
) |
|
Other |
|
63 |
|
|
|
- |
|
|
|
(76 |
) |
|
|
(58 |
) |
|
Total gross profit
(loss) |
$ |
381 |
|
|
$ |
76 |
|
|
$ |
935 |
|
|
$ |
(473 |
) |
|
|
|
|
|
|
|
|
|
|
Total administration
costs (1) |
$ |
13,637 |
|
|
$ |
12,332 |
|
|
$ |
40,517 |
|
|
$ |
34,409 |
|
|
|
|
|
|
|
|
|
|
|
Net loss attributable
to common shareholders |
$ |
(13,420 |
) |
|
$ |
(10,238 |
) |
|
$ |
(38,354 |
) |
|
$ |
(30,568 |
) |
|
Diluted net loss per
share |
$ |
(0.07 |
) |
|
$ |
(0.06 |
) |
|
$ |
(0.21 |
) |
|
$ |
(0.17 |
) |
|
|
|
|
|
|
|
|
|
|
Cash used in operating
activities |
$ |
(13,908 |
) |
|
$ |
(13,041 |
) |
|
$ |
(29,669 |
) |
|
$ |
(37,296 |
) |
|
|
|
|
|
|
|
|
|
|
|
At September 30, 2016 |
|
At December 31, 2015 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash, cash equivalents
and restricted cash |
$ |
88,413 |
|
|
$ |
111,796 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) Administration costs represent total research and
development, and selling, general and administrative costs,
including amortization of intangible assets. |
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Plug Power Inc. |
|
Other Key Measures |
|
(Dollars in 000's) |
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|
|
|
|
|
|
|
|
|
|
For the three months ended September 30, |
|
For the nine months ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
EBITDAS |
$ |
(9,356 |
) |
|
$ |
(9,231 |
) |
|
$ |
(29,482 |
) |
|
$ |
(26,731 |
) |
|
|
|
|
|
|
|
|
|
|
Value of PPA assets
deployed (2) |
$ |
17,343 |
|
|
$ |
- |
|
|
$ |
49,644 |
|
|
$ |
- |
|
|
Excess of value of PPA
assets deployed over cost (2) |
$ |
5,805 |
|
|
$ |
- |
|
|
$ |
15,130 |
|
|
$ |
- |
|
|
|
|
|
|
|
|
|
|
|
(2) Value of PPA assets deployed excludes those assets which
were associated with revenue recognized under US GAAP. |
|
|
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|
|
|
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|
|
|
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|
|
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|
Plug Power Inc. |
|
Reconciliation of Non-GAAP Financial Measures |
|
(Dollars in 000's) |
|
|
|
|
|
|
|
|
|
|
Reconciliation of Reported Operating Loss to EBITDAS |
For the three months ended September 30, |
|
For the nine months ended September 30, |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
2016 |
|
|
|
2015 |
|
|
|
|
|
|
|
|
|
|
|
Operating loss, as
reported |
$ |
(13,256 |
) |
|
$ |
(12,256 |
) |
|
$ |
(39,582 |
) |
|
$ |
(34,882 |
) |
|
Stock-based compensation |
|
2,368 |
|
|
|
2,400 |
|
|
|
6,745 |
|
|
|
5,835 |
|
|
Depreciation and amortization |
|
1,532 |
|
|
|
625 |
|
|
|
3,355 |
|
|
|
2,316 |
|
|
EBITDAS |
$ |
(9,356 |
) |
|
$ |
(9,231 |
) |
|
$ |
(29,482 |
) |
|
$ |
(26,731 |
) |
|
|
|
|
|
|
|
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To supplement the Company’s unaudited financial
data presented on a generally accepted accounting principles (GAAP)
basis, management has used certain non-GAAP measures, including
EBITDAS. These non-GAAP results are among the indicators
management uses as a basis for evaluating the Company’s financial
performance as well as for forecasting future periods.
Management establishes performance targets, annual budgets and
makes operating decisions based in part upon these metrics.
Accordingly, disclosure of these non-GAAP measures provides
investors with the same information that management uses to
understand the Company’s economic performance year over year. In
addition, investors have historically requested and the Company has
historically reported these non-GAAP financial measures as a means
of providing consistent and comparable information with past
reports of financial results. The presentation of this additional
information is not meant to be considered in isolation or as a
substitute for net income or other measures prepared in accordance
with GAAP. EBITDAS is defined as net income before interest
expense, provision for income taxes, depreciation and amortization
expense and stock compensation expense. EBITDAS is not a
measure of our liquidity or financial performance under GAAP and
should not be considered as an alternative to net income or any
other performance measure derived in accordance with GAAP, or as an
alternative to cash flows from operating activities as a measure of
our liquidity. While management believes that the non-GAAP
financial measures provide useful supplemental information to
investors, there are limitations associated with the use of these
measures. The measures are not prepared in accordance with
GAAP and may not be directly comparable to similarly titled
measures of other companies due to potential differences in the
exact method of calculation. Further, EBITDAS exclude certain
expenses, such as depreciation and amortization expense, which
represent significant and unavoidable operating costs of our
business. Management compensates for these limitations by
relying primarily on our GAAP results and by using EBITDAS only
supplementally and by reviewing the reconciliations of the non-GAAP
financial measures to their most comparable GAAP financial
measures. Non-GAAP financial measures are not in accordance with,
or an alternative for, generally accepted accounting principles in
the United States. The Company’s non-GAAP financial measures
are not meant to be considered in isolation or as a substitute for
comparable GAAP financial measures, and should be read only in
conjunction with the Company’s consolidated financial statements
prepared in accordance with GAAP. |
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Media and Investor Relations Contact:
Teal Vivacqua
Plug Power Inc.
Phone: 518.738.0269
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