Hydrogenics cut costs and losses in second quarter

30 July 2010

Listed hydrogen fuel cell developer Hydrogenics cut its losses by 72 per cent and doubled its gross profit margin from 15 per cent to 30 per cent during the last quarter.

It said the gross profit increment was generated by the Power Systems business unit due to a diversified product mix.

Reporting an operational loss of $1.4m for the quarter ending in June this year, which it said reflects a reduction in operating expenses, the company is expecting further cost reductions incurred from a move of head office in the following quarter.

It also said that delays in shipments during the quarter caused a shift in revenues that the company expects to be evident in the third quarter results, when the delivery of $7.9m of orders by three customers is expected to be finalised.

Revenues for the period declined, however, with year-on-year quarterly revenue falling 49 per cent to $2.8m, bringing the total half year’s revenues up to $9.5m – 14 per cent less than the first half of 2009.

Its cash and cash equivalents at the end of the quarter stood at $10.3m, representing a $2.8m quarterly decrease from the first quarter of the year.

During the quarter, Hydrogenics finalised the fourth milestone of its deployment at General Motors in Canada, which it said contributed $600,000 of research and development funding that reduced its spending in this area.

Its order backlog at the end of June was $19.1m, of which it said at least $15m is anticipated to be delivered in the second half of 2010.

‘While our revenue was negatively affected this period due to some shipments being pushed out into the third quarter, we once again posted improved margins and ended the quarter with a solid backlog,’ said Daryl Wilson, CEO of Hydrogenics.

‘In addition, we successfully reduced our cash operating costs by nearly 70 per cent – resulting in an operating loss of $1.4m as compared with $5.7m last year. We continue to see a rebound in our end markets and view the second half of 2010 as being an improvement, setting the stage for further growth in 2011.’

Nasdaq-listed Hydrogenics is based in Mississauga, in the Canadian province of Canada, with operations in the US and Europe.

Copyright © 2010 NewNet

Tags: energy efficiency, hydrogen fuel cell

This story was published on Friday, July 30th, 2010 at 4:35 pm and is filed under North America, companies, energy efficiency. You can follow any responses to article entry through the RSS 2.0 feed. You can skip to the end and leave a response. Pinging is currently not allowed.

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