EBITDA was NOK -51 million in the third quarter of 2024, compared to NOK -116 million in the same period last year. This corresponds to an EBITDA margin of -9% in the third quarter of 2024, up from -30% in the third quarter of 2023. Financials in the quarter was positively impacted by the contract termination payment from Daimler Trucks North America. YTD as per the third quarter of 2024, the EBITDA margin is -17%, up from -33% in the same period last year;
Successfully raised gross proceeds of approximately NOK 1 billion through an equity private placement;
Entered into a multi-year supply agreement with GILLIG, a leading designer and manufacturer of heavy-duty transit buses in the US, for supply of hydrogen fuel storage systems;
Hexagon Purus and Panasonic Energy agreed to amend terms for battery cell supply agreement, which inter alia reduces outstanding pre-payment amount by USD 21.5 million;
Selected by New Flyer for the fifth consecutive year to supply hydrogen cylinders for transit buses in North America. Total value of contract estimated to approx. USD 6.3 million;
Daimler Truck North America and Hexagon Purus end supply agreement for battery electric vocational vehicles;
Exited the quarter with order backlog consisting of firm purchase orders of NOK 913 million, providing full backlog coverage for FY 2024 revenue target.

“Q3 2024 was another record quarter for Hexagon Purus, continuing the strong positive momentum we’ve built throughout the year. We have consistently grown revenue quarter by quarter, but most importantly, we have reported positive EBITDA in our hydrogen business in Europe and North America for two consecutive quarters”, says Morten Holum, CEO of Hexagon Purus. “In Q3 2024, we also put the finishing touches to the new vehicle integration facility in Dallas, marking the end of our multi-year capacity expansion program. Our new manufacturing footprint gives us capacity to continue growing significantly in the years ahead without major new capital investments”.

Hexagon Purus Q3 2024 consolidated financials

In the third quarter of 2024, Hexagon Purus (“the Company” or “the Group”) generated all-time high quarterly revenue of NOK 544 million, up 43% from the corresponding period in 2023. Hydrogen infrastructure and hydrogen mobility solutions were the main drivers of growth year-over-year. In the quarter, NOK 29 million in contract termination payment from Daimler Truck North America was also recognized under other operating revenue. Year-to-date as of the third quarter of 2024, accumulated revenue stood at NOK 1,480 million, up 55% compared to the same period in 2023.

Total assets at the end of the third quarter of 2024 amounted to NOK 4,620 (3,786) million. The year-over-year increase in total assets is mainly driven by increases to property, plant and equipment and right-of-use assets resulting from the Company’s capacity expansion program, combined with an increase in working capital to cater for higher revenue. Inventory amounted to NOK 678 (438) million as of the end of the third quarter of 2024, and the majority of inventory consists of raw materials and items in work-in-progress. Trade receivables increased to NOK 468 (311) million in the third quarter of 2024 and reflects the revenue increase experienced in the quarter.
Net cash flow from operating activities in the third quarter of 2024 was NOK -115 (-284) million, of which NOK -59 (-152) million was due to an increase in net working capital, driven by an increase in inventory and trade receivables on the back of strong revenue growth.

Net cash flow from investing activities was NOK -135 (-117) million in the third quarter of 2024, of which NOK 128 million relates to investments in production equipment and facilities related to the Company’s capacity expansion program. Net cash flow from financing in the third quarter of 2024 was NOK -25 (-21) million. Cash interest payments and repayment of lease liabilities amounted to NOK 23 (20) million in the third quarter of 2024, while repayment of interest bearing loans amounted to NOK 2 (1) million.

Cash and cash equivalents stood at NOK 269 (566) million at the end of the third quarter of 2024.

Hydrogen Mobility and Infrastructure (HMI)

Revenue for the HMI segment in the third quarter of 2024 totaled NOK 514 million, up 35% compared to the corresponding period in 2023. Year-to-date as of the third quarter of 2024, revenue amounted to NOK 1,427 million, which represents growth of 55% compared to the corresponding period in 2023. 59% (59%) of the HMI segment revenue in the third quarter of 2024 stemmed from hydrogen infrastructure solutions, which grew 34% year-over-year. Hydrogen mobility, which covers revenue from the sale of type 4 hydrogen cylinders and cylinder systems for hydrogen-powered on-road and off-road vehicles, continued to develop strongly in the quarter and made up 29% (15%) of HMI segment revenue in the third quarter of 2024. This represents 163% year-over-year growth and was mainly driven by increased deliveries to transit bus OEM customers such as Solaris, CaetanoBus and New Flyer and heavy-duty vehicle customer Nikola.

EBITDA for the HMI segment in the third quarter of 2024 ended at NOK 11 (-29) million, equivalent to an EBITDA margin of 2% (-8%). Year-to-date as per the third quarter of 2024, EBITDA was NOK 13 (-61) million, equivalent to an EBITDA margin of 1% (-7%). The Company’s hydrogen infrastructure and aerospace and specialty cylinder business recorded close to double-digit EBITDA margin during the third quarter of 2024, but HMI segment EBITDA was negatively offset by the Company’s hydrogen mobility business.

Historical segment financials are made available on www.hexagonpurus.com together with Q3 2024 report and presentation.

Battery Systems and Vehicle Integration (BVI)

Revenue for the BVI segment in the third quarter of 2024 was NOK 29 (0) million, which was almost solely related to the contract termination payment from Daimler Truck North America (as announced on 4 October). Year-to-date as of the third quarter of 2024, revenue stood at NOK 50 (31) million. Revenue recognition for the BVI segment is expected to pick-up during the fourth quarter of 2024 as initial deliveries of complete battery electric heavy-duty vehicles are expected to be made to Hino Trucks.

BVI segment EBITDA ended at NOK -21 (-36) million in the third quarter of 2024 and was positively affected by the DTNA contract termination payment and CVIC funding contribution.

Historical segment financials are made available on www.hexagonpurus.com together with Q3 2024 report and presentation.

Outlook

With the multi-year capacity expansion program close to completion, the Company now has sufficient capacity to cover the expected growth over the next few years. The Company’s focus for the coming years will be to optimize the utilization of existing capacity, drive operational improvements and profitability, and minimize further capital spend. On 31 October, the Company announced the successful completion of a private placement of new shares, raising approximately NOK 1 billion in gross proceeds. The proceeds from the private placement will be used to finance the Company’s business plan and are intended to fund the Company past the point of cash flow break-even.

The Company’s order backlog, consisting of firm customer purchase orders, stood at approximately NOK 0.9 billion as of the third quarter of 2024, with about 56% due for execution in 2024 and about 44% for execution in 2025. Combining the year-to-date revenue as of the third quarter of 2024 with the backlog for the rest of 2024, gives coverage of this year’s revenue target of at least 50% year-over-year revenue growth. The backlog for 2025 is expected to continue to increase going forward. The backlog dynamic is also expected to change somewhat going forward as mobility applications becomes a larger part of the revenue mix. The Company’s mobility customers, compared to its hydrogen infrastructure customers, usually have much shorter lead-time from purchase order to delivery, which means backlog coverage far out in time will usually also be lower in relative terms.

The new incoming administration following the US presidential election has increased uncertainty around the near-term outlook for the energy transition and zero emission mobility in North America, and it is currently unclear what impact this will have on the Company’s end-markets. For the full-year 2024, the Company continues to expect revenue growth of at least 50% year-over-year, as well as significant year-over-year improvement in the Group’s EBITDA margin. For 2025, based on preliminary estimates, the Company still believe it is achievable to deliver revenue growth of at least 50% year-over-year and continued significant improvement in EBITDA margin. The Company expects to reach EBITDA break-even and be cash flow positive during 2026.

New Research: Renewable Hydrogen Delivers a Viable Path to a Clean Energy Future