Hexagon Purus ASA: Results for the third quarter 2024

28 Nov 2024 07:00 CET

Key developments in Q3 2024 and after balance sheet date:

Record-high quarterly revenue of NOK 544 million in the third quarter of 2024,
up 43% from the third quarter of 2023. Year-to-date (YTD) revenue as per the
third quarter of 2024 stood at NOK 1,480 million, up 55% compared to the same
period in 2023;

* 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
(http://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
(http://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.

Presentation of the results

Hexagon Purus will present the Q3 2024 results at 08:30 CEST on Thursday 28
November and the presentation will be broadcast live via
https://hexagonpurus.vivida.live
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The presentation will be held in English and will be virtual. Recording of the
presentation will be made available on www.hexagonpurus.com
(http://www.hexagonpurus.com/).

For more information:

Mathias Meidell, IR Director, Hexagon Purus ASA
Telephone: +47 909 82 242 | mathias.meidell@hexagonpurus.com
(mailto:mathias.meidell@hexagonpurus.com)

Salman Alam, CFO, Hexagon Purus ASA
Telephone: +47 476 12 713 | salman.alam@hexagonpurus.com
(mailto:salman.alam@hexagonpurus.com)

About Hexagon Purus ASA

Hexagon Purus enables zero emission mobility for a cleaner energy future. The
company is a world leading provider of hydrogen Type 4 high-pressure cylinders
and systems, battery systems and vehicle integration solutions for fuel cell
electric and battery electric vehicles. Hexagon Purus' products are used in a
variety of applications including light, medium and heavy-duty vehicles, buses,
ground storage, distribution, refueling, maritime, rail and aerospace.

Learn more at www.hexagonpurus.com and follow @HexagonPurus on X and LinkedIn.

This information is subject to the disclosure requirements pursuant to Section
5-12 the Norwegian Securities Trading Act

More information:
Access the news on Oslo Bors NewsWeb site

633348_HPUR Q3 2024 Presentation.pdf
633348_HPUR Q3 2024 Report.pdf