About FuelCell Energy

FuelCell Energy, Inc. (NASDAQ: FCEL): FuelCell Energy is a global leader in delivering environmentally responsible distributed baseload energy platform solutions through our proprietary fuel cell technology. FuelCell Energy is focused on advancing sustainable clean energy technologies that address some of the world’s most critical challenges around energy access, security, resilience, reliability, affordability, safety and environmental stewardship. As a leading global manufacturer of proprietary fuel cell technology platforms, FuelCell Energy is uniquely positioned to serve customers worldwide with sustainable products and solutions for industrial and commercial businesses, utilities, governments, municipalities, and communities.

SureSource, SureSource 1500, SureSource 3000, SureSource 4000, SureSource Recovery, SureSource Capture, SureSource Hydrogen, SureSource Storage, SureSource Service, SureSource Capital, FuelCell Energy, and FuelCell Energy logo are all trademarks of FuelCell Energy, Inc.

Contact:
FuelCell Energy, Inc.
ir@fce.com
203.205.2491

FUELCELL ENERGY, INC. Consolidated Balance Sheets (Unaudited) (Amounts in thousands, except share and per share amounts)

		July 31, 2024			October 31, 2023
ASSETS
Current assets:
Cash and cash equivalents, unrestricted	$	159,347		$		249,952
Restricted cash and cash equivalents – short-term		9,686				5,159
Investments – short-term		107,817				103,760
Accounts receivable, net		11,161				3,809
Unbilled receivables		30,169				16,296
Inventories		129,349				84,456
Other current assets		12,439				12,881
Total current assets		459,968				476,313

Restricted cash and cash equivalents – long-term		49,148				44,465
Inventories – long-term		2,743				7,329
Project assets, net		248,790				258,066
Property, plant and equipment, net		121,382				89,668
Operating lease right-of-use assets, net		7,884				8,352
Goodwill		4,075				4,075
Intangible assets, net		15,104				16,076
Other assets		39,816				51,176
Total assets ⁽¹⁾	$	948,910		$		955,520
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current portion of long-term debt	$	12,232		$		10,067
Current portion of operating lease liabilities		760				599
Accounts payable		16,928				26,518
Accrued liabilities		25,970				26,313
Deferred revenue		10,649				2,406
Total current liabilities		66,539				65,903

Long-term deferred revenue		1,979				732
Long-term operating lease liabilities		8,708				8,992
Long-term debt and other liabilities		126,720				119,588
Total liabilities ⁽¹⁾		203,946				195,215

Redeemable Series B preferred stock (liquidation preference of $64,020 as of July 31, 2024 and October 31, 2023)		59,857				59,857
Total equity:
Stockholders’ equity: Common stock ($0.0001 par value); 1,000,000,000 shares authorized as of July 31, 2024 and October 31, 2023; 553,840,943 and 450,626,862 shares issued and outstanding as of July 31, 2024 and October 31, 2023, respectively		55				45
Additional paid-in capital		2,277,417				2,199,661
Accumulated deficit		(1,600,134	)			(1,515,541	)
Accumulated other comprehensive loss		(1,576	)			(1,672	)
Treasury stock, Common, at cost (376,340 and 246,468 shares as of July 31, 2024 and October 31, 2023, respectively)		(1,198	)			(1,078	)
Deferred compensation		1,198				1,078
Total stockholders’ equity		675,762				682,493
Noncontrolling interests		9,345				17,955
Total equity		685,107				700,448
Total liabilities, redeemable Series B preferred stock and total equity	$	948,910		$		955,520

^{(1) As of July 31, 2024 and October 31, 2023, the combined assets of the variable interest entities (“VIEs”) were $318,698 and $235,290, respectively, that can only be used to settle obligations of the VIEs. These assets include cash of $4,239, accounts receivable of $726, unbilled accounts receivable of $8,403, operating lease right of use assets of $1,667, other current assets of $137,326, restricted cash and cash equivalents of $625, project assets of $161,964 and other assets of $3,749 as of July 31, 2024, and cash of $4,797, unbilled accounts receivable of $1,876, operating lease right of use assets of $1,680, other current assets of $50,713, restricted cash and cash equivalents of $526, project assets of $170,444, derivative asset of $4,127 and other assets of $1,125 as of October 31, 2023. The combined liabilities of the VIEs as of July 31, 2024 include short-term operating lease liabilities of $203, accounts payable of $184,900, accrued liabilities of $497, deferred revenue of $132, long-term operating lease liability of $2,146, and other non-current liabilities of $2,725 and, as of October 31, 2023, include short-term operating lease liabilities of $203, accounts payable of $165,824, long-term operating lease liability of $2,159 and other non-current liabilities of $187.}

FUELCELL ENERGY, INC. Consolidated Statements of Operations and Comprehensive Loss (Unaudited) (Amounts in thousands, except share and per share amounts)

	Three Months Ended July 31,
	2024			2023
Revenues:
Product	$	250		$	-
Service		1,411			9,841
Generation		13,402			10,982
Advanced Technologies		8,632			4,687
Total revenues		23,695			25,510
Costs of revenues:
Product		4,181			2,910
Service		1,146			9,575
Generation		18,761			17,483
Advanced Technologies		5,809			3,757
Total costs of revenues		29,897			33,725
Gross loss		(6,202	)		(8,215	)
Operating expenses:
Administrative and selling expenses		14,599			17,560
Research and development expenses		12,816			15,620
Total costs and expenses		27,415			33,180
Loss from operations		(33,617	)		(41,395	)
Interest expense		(2,555	)		(1,912	)
Interest income		3,269			3,966
Gain on early extinguishment of finance obligations and debt, net		-			15,337
Other (expense) income, net		(2,218	)		403
Loss before provision for income taxes		(35,121	)		(23,601	)
Provision for income taxes		(2	)		-
Net loss		(35,123	)		(23,601	)
Net (loss) income attributable to noncontrolling interest		(2,463	)		678
Net loss attributable to FuelCell Energy, Inc.		(32,660	)		(24,279	)
Series B preferred stock dividends		(800	)		(800	)
Net loss attributable to common stockholders	$	(33,460	)	$	(25,079	)
Loss per share basic and diluted:
Net loss per share attributable to common stockholders	$	(0.07	)	$	(0.06	)
Basic and diluted weighted average shares outstanding		503,183,725			415,867,594

FUELCELL ENERGY, INC. Consolidated Statements of Operations and Comprehensive Loss (Unaudited) (Amounts in thousands, except share and per share amounts)

	Nine Months Ended July 31,
	2024			2023
Revenues:
Product	$	250		$	9,095
Service		4,397			49,913
Generation		38,013			28,979
Advanced Technologies		20,146			12,945
Total revenues		62,806			100,932

Costs of revenues:
Product		9,510			7,425
Service		4,301			40,633
Generation		61,079			51,166
Advanced Technologies		12,917			10,779
Total costs of revenues		87,807			110,003

Gross loss		(25,001	)		(9,071	)

Operating expenses:
Administrative and selling expenses		48,659			47,637
Research and development expenses		43,796			43,000
Total costs and expenses		92,455			90,637

Loss from operations		(117,456	)		(99,708	)

Interest expense		(7,168	)		(4,926	)
Interest income		10,726			11,064
Gain on early extinguishment of finance obligations and debt, net		-			15,337
Other (expense) income, net		(3,278	)		216

Loss before provision for income taxes		(117,176	)		(78,017	)
Provision for income taxes		(2	)		(581	)

Net loss		(117,178	)		(78,598	)
Net loss attributable to noncontrolling interest		(32,585	)		(1,394	)

Net loss attributable to FuelCell Energy, Inc.		(84,593	)		(77,204	)
Series B preferred stock dividends		(2,400	)		(2,400	)

Net loss attributable to common stockholders	$	(86,993	)	$	(79,604	)

Loss per share basic and diluted:
Net loss per share attributable to common stockholders	$	(0.19	)	$	(0.19	)
Basic and diluted weighted average shares outstanding		469,387,264			409,361,826

Appendix

Non-GAAP Financial Measures

Financial results are presented in accordance with accounting principles generally accepted in the United States (“GAAP”). Management also uses non-GAAP measures to analyze and make operating decisions on the business. Earnings before interest, taxes, depreciation and amortization (“EBITDA”) and Adjusted EBITDA are non-GAAP measures of operations and operating performance by the Company.

These supplemental non-GAAP measures are provided to assist readers in assessing operating performance. Management believes EBITDA and Adjusted EBITDA are useful in assessing performance and highlighting trends on an overall basis. Management also believes these measures are used by companies in the fuel cell sector and by securities analysts and investors when comparing the results of the Company with those of other companies. EBITDA differs from the most comparable GAAP measure, net loss attributable to the Company, primarily because it does not include finance expense, income taxes and depreciation of property, plant and equipment and project assets. Adjusted EBITDA adjusts EBITDA for stock-based compensation, restructuring charges, non-cash (gain) loss on derivative instruments and other unusual items, which are considered either non-cash or non-recurring.

While management believes that these 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. 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.

The following table calculates EBITDA and Adjusted EBITDA and reconciles these figures to the GAAP financial statement measure Net loss.

	Three Months Ended July 31,						Nine Months Ended July 31,
(Amounts in thousands)		2024			2023			2024				2023
Net loss	$	(35,123	)	$	(23,601	)		(117,178	)	$	(78,598		)
Depreciation and amortization ⁽¹⁾		9,238			6,623			27,389			18,659
Provision for income taxes		2			-			2			581
Other (income) expense, net ⁽²⁾		2,218			(403	)		3,278			(216		)
Gain on extinguishment of finance obligations and debt, net⁽⁴⁾		-			(15,337	)		-			(15,337		)
Interest income		(3,269	)		(3,966	)		(10,726	)		(11,064		)
Interest expense		2,555			1,912			7,168			4,926
EBITDA	$	(24,379	)	$	(34,772	)	$	(90,067	)	$	(81,049		)
Stock-based compensation expense		3,350			3,166			9,227			8,997
Unrealized loss on natural gas contract derivative assets ⁽³⁾		895			-			5,072			-
Adjusted EBITDA	$	(20,134	)	$	(31,606	)	$	(75,768	)	$	(72,052		)

^{(1) Includes depreciation and amortization on our Generation portfolio of $7.3 million and $21.3 million for the three and nine months ended July 31, 2024, respectively, and $5.4 million and $14.9 million for the three and nine months ended July 31, 2023, respectively.} ^{(2) Other (income) expense, net includes gains and losses from transactions denominated in foreign currencies, interest rate swap income earned from investments and other items incurred periodically, which are not the result of the Company’s normal business operations.} ^{(3) The Company recorded a mark-to-market net loss of $0.9 million and $5.1 million for the three and nine months ended July 31, 2024, respectively, related to natural gas purchase contracts. There was no comparable loss in the prior year as the Company changed its designation in the fourth quarter of fiscal year 2023 and in the second quarter of fiscal year 2024, as a result of net settling certain natural gas purchases under previous normal purchase normal sale contract designations, which resulted in a change to mark-to-market accounting. There were no mark-to-market gains or losses for the three and nine months ended July 31, 2023. These losses are classified as Generation cost of sales.} ^{(4) The gain on extinguishment of finance obligations and debt, net was $15.3 million for the three and nine months ended July 31, 2023 and represents a one-time gain on the payoff of certain finance obligations of the Company to PNC Energy Capital, LLC, which payoff occurred in conjunction with a new project financing facility entered into in May 2023.}

FuelCell Energy Reports Third Quarter of Fiscal 2024 Results