Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Hydrogenics: Scaling Significant Global Opportunities

Published 08/10/2016, 06:44 AM
Updated 07/09/2023, 06:31 AM

Hydrogenics Corporation (TO:HYG) has proven, commercially available electrolyser and fuel cell products, which are being deployed in multiple applications as the world transitions to a low-carbon, hydrogen-fuelled economy. A strong order book (US$103m at end June 2016) underpins consensus growth estimates.

Strong order book underpins consensus estimates

Total revenues rose by 25% year-on-year to US$9.2m in Q216, reflecting a rise in OnSite Generation shipments, partially offset by a decrease in the Power Systems segment resulting from the timing of deliveries on certain long-term projects. Higher overhead absorption relating to increased revenues plus product mix drove a 570bp increase in gross margin to 19.8%, a trend that management expects to continue. Adjusted EBITDA losses widened slightly (by $0.1m to $2.4m), reflecting additional sales personnel and higher R&D costs. Cash burn totalled $6.3m, higher than management’s c $4m average quarterly target run rate because of the timing of certain R&D expenses, leaving $11.6m net cash at end June 2016. $16.2m of orders were received during Q2, including c $13.5m from SinoHytec for fuel cell-based power systems used in buses and trucks, which was the first significant order from China. This gave a $102.9m order backlog at end June 2016, $28.9m of which is scheduled for delivery during the next 12 months, underpinning estimates.

Projects open doors to US$17bn total market

Hydrogenics continued to make progress on key projects, which open the door to markets that collectively total US$17bn. These are power-to-gas energy storage (with E.ON), extended range electric rail transport (with Alstom (PA:ALSO) Rail), hydrogen refuelling infrastructure in Europe and North America, and nuclear waste water treatment in Japan (with Kurion/Veolia). Management’s priority short term is to finalise plans for a 50MW continuous power generation plant in Korea (US$100m+ opportunity), pursuing the pipeline of qualified opportunities (a further US$140m+) and doubling capacity at the Ontario facility to meet anticipated demand.

To read the entire report Please click on the pdf File Below

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.