Release Date: August 20, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- HydrogenPro ASA (HYPRF, Financial) decided to invest in increased capacity of their Generation 3 electrodes due to rising interest and requests.
- Positive development of the cash balance with an increase of NOK62 million.
- Strengthened partnership with Andritz through an NOK82.7 million investment.
- Successful delivery and installation of all Electrolysers and gas separator skids at ACES.
- HydrogenPro ASA (HYPRF) is one of the few hydrogen OEMs delivering on large projects, proving their capability to handle complex systems.
Negative Points
- The market is moving slower than expected, impacting the pace of project completions.
- Gross profit was negative at NOK22 million, and EBITDA was minus NOK65 million, leading to a net loss of NOK77 million for the quarter.
- Additional costs incurred on the ACES project, impacting the financial results negatively by NOK36 million.
- No significant contract awards in the second quarter, leading to a decrease in the order backlog from NOK445 million to NOK416 million.
- Slowdown in Final Investment Decisions (FIDs) due to high energy prices, increased inflation, and unclear incentive schemes.
Q & A Highlights
Q: Can you provide an update on DG Fuels?
A: The project is currently with the Department of Energy (DOE) for grant and incentive applications. Progress is ongoing, but it's largely in the hands of the DOE and DG Fuels.
Q: Can you elaborate on the additional costs for ACES and what has happened?
A: Some old equipment needed replacement. We are in discussions with both the client and sub-suppliers to determine who will bear these costs. For conservative reasons, we have recognized the costs in this quarter.
Q: Will the extra costs for the ACES project be compensated by extra revenues?
A: There will not be extra revenues. Discussions are ongoing with both the client and sub-suppliers to determine who will bear these costs.
Q: Is HydrogenPro working on a FEED study with H2V in France?
A: No, we are not in a FEED study with H2V.
Q: Are you seeing any changes in use cases developing, especially new use cases for hydrogen?
A: We are focusing on large-scale industrial projects such as ammonia, fertilizers, jet fuel, and decarbonization in various industries like steel.
Q: Can you give a broad geographic split of the pipeline as it stands today?
A: Approximately 60% of our pipeline is in Europe and 40% in the US. We are seeing an increased number of requests from the US.
Q: Do you think the winning formula will be lower cost or better product in the future?
A: The winning formula will be proven and documented technology. Being able to document and demonstrate performance gives clients assurance when calculating their own levelized cost of hydrogen.
Q: In reference to the recent update on Denmark, will you have 500 megawatts of capacity in China and then 350 megawatts of capacity in Denmark in 2025?
A: Yes, that's the current plan. We are also looking into further optimization within the same CapEx frame to potentially increase capacity without additional investment.
Q: What do you consider to be the current market price for electrolyser sale stacks?
A: We are not disclosing a specific number as each project is unique and pricing is based on the complexity of the projects.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
