ROCHESTER, N.Y., November 14, 2023 — Hyzon Motors Inc. (NASDAQ: HYZN) (Hyzon or the Company), a leading hydrogen fuel cell technology developer and global supplier of zero-emission heavy-duty fuel cell electric vehicles (FCEVs), today announced its third quarter 2023 financial and operational results.
- Delivered first revenue-generating FCEV to a customer in North America at Port of Los Angeles/Long Beach, commercially entering drayage market
- Deployed 14 FCEVs under commercial agreements and collected approximately $3.6 million in cash year-to-date; raises low end of 2023 guidance to 15-20 vehicles deployed under commercial agreements
- Fuel cell production facility in Bolingbrook, Illinois on track for 2024 Start of Production (SoP) with less than $5M of CapEx remaining; estimating an initial annual capacity of over 700 200kW FCSs on three shifts
- Strengthened executive leadership team through appointment of Stephen Weiland as CFO
- Reported lowest quarterly cash burn over the last eight quarters, including third consecutive quarter of declining cash burn
- Unrestricted cash, cash equivalents, and short-term investments of $137.8 million as of September 30, 2023, and approximately $129 million as of October 31, 2023
“This was a remarkable quarter as Hyzon continues to accelerate the global transition to clean energy by developing and commercializing our proprietary, leading zero-emission fuel cell technology,” said Parker Meeks, Chief Executive Officer of Hyzon. “We believe that Hyzon is at an inflection point as we recently made our first commercial delivery in the U.S., are advancing our customer pipeline, and expect less than $5 million in capital investments to reach Start of Production at our fuel cell manufacturing facility. All of this, combined with the significant tailwinds for the hydrogen ecosystem from recently advanced government subsidy programs, put Hyzon in a strong position to lead in the race to decarbonization.”
Third Quarter 2023 Business Highlights
Fuel Cell Electric Vehicle Deployments
By the end of the third quarter, Hyzon had deployed 13 vehicles under commercial agreements to customers in 2023; one additional vehicle was deployed subsequent to the quarter end. Of those vehicles, one was deployed in North America, three were deployed to customers in Europe, and ten coach buses were deployed to a customer in Australia.
With a total of 14 vehicles deployed to date, Hyzon raises the low end of its guidance to 15-20 vehicles deployed by year end, from its previous guidance of 10-20 vehicle. Hyzon also has collected approximately $3.6 million in cash in the first three quarters of 2023 against those vehicles. The Company’s North American trial program continued to expand, with 18 trials completed since March 2022, of which 10 trials were completed in 2023, gaining experience with and learnings from real world operations for future FCEV deployments.
Significant Commercial Progress, with Agreements Signed and Trials Initiated and/or Completed
Subsequent to the quarter-end, Hyzon made what the Company believes is the industry’s first publicly-announced commercial sale and delivery of a heavy-duty fuel cell electric truck in North America. The vehicle was delivered to a fleet operating out of the Port of Los Angeles/Long Beach, commercially entering the drayage market for fuel cell trucks, which the Company expects to represent a significant addressable market.
Also subsequent to the quarter-end, the Company announced the commercial trial deployment of its first Heavy Rigid fuel cell electric waste collection truck to REMONDIS Australia, one of the world’s largest waste service and recycling companies. The commercial trial is expected to convert to a full vehicle purchase if certain trial performance targets are met. Hyzon is on track to launch the first U.S. trial of the refuse truck platform in the first half of 2024 in California, with customer deliveries expected to begin in 2025.
The Company also signed a commercial agreement with New Zealand’s largest heavy-duty truck fleet owner, TR Group, for up to 20 vehicles powered by the 200kW fuel cell system, at TR Group’s option pending a successful trial planned to begin March 2024.
Single-Stack 200kW Fuel Cell System B-Samples Development
The Company continued its progress along the standard automotive product development methodology it is following for its next generation 200kw fuel cell, advancing toward SOP. In 2H 2023, the Company completed factory acceptance testing of nine single-stack 200kW FCS B-samples at its production and innovation center in Bolingbrook, IL. The Company remains on track to complete a total of 25 200kW B-samples and declare C-Sample by the end of 2023 and begin SOP of its 200kW fuel cell system in 2024.
The Company’s world-class fuel cell production facility in Bolingbrook, Illinois has less than $5 million in capital investments remaining to complete the SOP of the 200kW FCS in 2024. Upon SOP, the facility is projected to have initial annual capacity for over 700 200kW FCSs on three shifts. The Company expects that initial annual capacity to satisfy volume forecasts through 2025, with plans for capacity expansion by using lean production to mitigate bottlenecks and constraints.
Advancement & Commercialization of Fuel Cell Technology
Hyzon continues to build on its strong foundation of fuel cell Intellectual Property (IP). In Q3, Hyzon was granted an additional 10 exclusively-owned patents, bringing its total patent base to 158 (applied and granted), with 80 patents applied and granted since 2021.
Subsequent to the quarter end, the Company announced an amendment to its IP agreement with affiliates of Horizon, Hyzon’s majority controlling shareholder and an advanced hydrogen fuel cell solutions company. Under the amendment, Hyzon expands its market access to stationary fuel cell power applications in North America, in addition to its existing access to global fuel cell mobility markets. The amendment also covers the option for Hyzon and Horizon to pursue joint development of a single stack 300kW fuel cell system, which Hyzon previously announced as part of its product roadmap.
Board of Directors and Leadership Updates
Subsequent to the third quarter, in November, the Company appointed Stephen Weiland as Chief Financial Officer. Steve brings two decades of experience at companies including Caterpillar, leading financial operations, driving diverse growth capital programs, executing transactions in Cleantech, and implementing critical financial processes.
In July, the Company appointed Matthew Foulston, an accomplished finance executive who served as CFO for three publicly listed companies, to its Board of Directors. In August, Hyzon’s Board of Directors elected Erik Anderson as Chairman, replacing George Gu who resigned his position. Anderson is a global innovation leader and investor, with leadership roles spanning various sectors. In addition, the Board elected Andrea Farace as Vice Chairman of Hyzon’s Board. Farace is an accomplished executive and leader with a long global career spanning more than 40 years in finance and general business management.
Announced Final Resolution of SEC Investigation
In September, Hyzon announced a final resolution of the investigation by the SEC, subject to court approval. Without admitting or denying the allegations in the SEC’s complaint, Hyzon has agreed to pay a civil monetary penalty of $25 million in three installments: $8.5 million within 30 days of entry of final judgment; $8.5 million by December 31, 2024; and $8 million within 730 days of entry of final judgment. Further details regarding the resolution can be found in the SEC’s complaint and proposed final judgments, which are publicly available.
Third Quarter 2023 Financial Updates
As of September 30, 2023, unrestricted cash, cash equivalents, and short-term investments were $137.8 million, approximately $34.6 million lower than the June 30, 2023 balance of $172.4 million. Cash burn of $34.6 million during the quarter represented the lowest quarterly cash burn over the last eight quarters, including third consecutive quarter of declining cash burn since the fourth quarter of 2022. As of October 31, 2023, unrestricted cash, cash equivalents, and short-term investments were approximately $129 million.
“We are pleased to have delivered this quarter the lowest cash burn in the last eight quarters, driven by operational efficiencies, cash management, lower legal and professional services expenses and managing personnel levels to support the business. These results give us confidence to share that our cash burn guidance is unchanged for both the second half of 2023 and the full year of 2024. We have demonstrated our ability to drive below $10 million per month of core cash burn already in the month of October”, said CEO Parker Meeks. “In addition to our cash burn reduction momentum, we remain focused on opportunistically raising capital, including a possible strategic raise which we continue to explore. The resolution of the SEC investigation removed a material obstacle. We believe Hyzon has significant strategic value, with leading technology, minimal remaining capital spending requirements through our 200kW fuel cell system SoP, and increasing customer agreements and deliveries.”
SOURCE: Hyzon Motors