PLUG - Earnings call transcript Q3 2019

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Operator

Greetings, and welcome to the Plug Power Third Quarter Earnings Call. [Operator Instructions].

As a reminder, this conference is being recorded.

It is now my pleasure to introduce Teal Hoyos, Director of Marketing Communications. Thank you.

begin. may You

Teal Hoyos

by contained believe of the morning, in Third future Good forward-looking to Plug important communicate be that and it of Securities Act Exchange expectations the We provisions XXA the Thank our of Earnings and Call. XXXX is covered to XXE statements Securities Quarter these Section to include of safe This statements Power harbor intend for you. forward-looking welcome the Act XXXX call forward-looking statements. Section XXXX. investors. We to will

to XA from and on forward-looking cautioned Factors with because and discussed to and XXXX However, to our materially a but investors are fiscal ending Item risks file not may limited uncertainties various results XX-K involve the unduly from Form uncertainties, rely well and December under of we on time report discussed as as reports year including, XX, the result for statements time risks those SEC. differ they other annual factors, as Risk actual not

on These date as forward-looking or after to any speak the statements we only not of intend update the made, undertake call. forward-looking this statements do are statements and which

Plug to like the At I this point, would call Power's over turn to CEO.

Andrew Marsh

We're I'd in performance $XX include, provided excites of this EBITDA like charges. have everyone. to the over indicator over is We I Few with as higher the without normal highlight that in morning, continues go warrant me. and million. earlier the quarter achieved we pleased improve a the an billings. would for was and EBITDA scale. million I'd billion, day. this Good really $X.X highlights. had our to highlights to the $X.X one released like our operating been believe detailed description than quarter, in shareholder letter gross some adjusted We

Today, we Fiat and Chrysler's of for VW, Honda, handling have validation applications. GM for our over BMW, XXX now Chrysler material order in first proposition value automotive Daimler, Our for Fiat units, another customers.

our with product at and the a applications were in BMW Power Three, new the handling XXX of expansion was activity leveraging the support European programs and channel of funding part order for that nearly app German continuing. funnel This Plug supported an some partners sales in deal for engines for Leipzig are recent Germany. factory our ProGen announcement. continues stacks units non-material

range large-scale aerial We have and many testing variety of that projects. This and our OEMs are Including of we stationary and wide projects includes applications, systems off-road and integrators stacks. a pursuing. a activities on-road

with quarters. We closed the liquid and supply also, which margins generation into a of quarter, the strategy. with part key positively partners is agreement Hydrogen integrating our in in gross our future hydrogen, United will vertically Hydrogen impact for

as achieve Plug adjusted for the EBITDA we record accomplishment Power will million company. revenue $XXX Fourth in million for $XXX for on the year, major a to track quarter to be are and breakeven a

StreetScooter deployment is with X have X our ProGen XXX by DHL. Germany in StreetScooter major We of engine using announcements XXX% of year: our the First was one units by for owned DHL. announced

without footprint Plug for has a new a million. that This Power global worth identified with ENGIE $X with across a is ENGIE have ENGIE. ENGIE. order We've in global would Our an closed region been nations. never partnership over already XX deal

new which quarter. Announcement further have them three, for preparing four, will Announcement working for We will customer We're already that be XXXX. announced deal plans pending our Plug Symposium. for the the be can outlined hydrogen in the years. this slides X multisite their early our Power At the will X this strategy, a plan extend which another was be with next our sites year. should from at supporting in X-year found out the that All presentation Power September symposium, rolled website. close Plug

a in and million for An power. income. plan plan, revenue fuel EBITDA broad turnkey in the $XXX capability our of cell $XXX million material by we highlight enunciated. with in with XXXX, goals targeting the is offering million the items. handing, rolled a The in operating these were At seminar, $XXX shop $XXX To are company XXXX, mix million billion targets these and space, the believe million Plug aggressive of as clearly stationary only but $XX logic in achievable. $X a in out few on-road vehicles achieving

Paul are your take I now questions. and pleased to

Operator

Instructions]. [Operator

comes first from Horn question Our Van Chris FBR. Riley B. with

Christopher Van Horn

additional on bit could more guys from maybe that provide award, you came geographical maybe detail the Chrysler Fiat a the I probably timing just little of where it perspective, how detail is? just -- about? the a to And some wanted rollout,

Andrew Marsh

Sure.

positive -- be over think be It is over million approximately looking And will Plug yesterday, was X units. we're occur It'll cycle that expand And I for the course, where in X overall, in Chrysler sales range relationship. activity. item Detroit, relatively the There the short. months. was to talked XXX about to deployment worth The of Power. a release was to $XX press this it'll of Michigan.

Christopher Van Horn

you back for right thanks now? think of directionally I you how about can how tell see Or playing out? is weighted? think XXXX When see half do the set year XXXX, I more about there it that detail. XXXX -- Okay, on you us Is When you plans. out that anything kind looking

Andrew Marsh

you'll symposium, and Good I will quarter and range. that laid second strong year. be at lighter, question, third the the the be in stronger And think a revenue first this Chris. XX% than I quarter out will expect much growth that would ramp I we overall, think see but

than visibility in great a have had XXXX deal we've already, ever We business. the to more of

of XX% we is everything which where ship to for about know we go, So will plan us. extraordinary

really it think business that I maturing. shows is the

Christopher Van Horn

that working it. one you how about are got in area? forward? the And specifically me. When we on Okay, going think that about last what do R&D, think for spend And you

Andrew Marsh

have will But we on variety the sees are of applications. increasing going. of probably our spend us front, funnel that, working about R&D items where in stacks. And at talk to the X the what XX let XX our I I'll look a he honestly, XX of about talk really that -- to when key And Sure. products funnel, a about on. you opportunities capacity lot I or the for with want. power it, applications quite And and about power really, we're Paul in there's higher starts XX

are customers products by is to think products would with that's So an going can plug without start one by vision looking battery fuel should that about additional someone it not them will Chris, second for pick use And at with Plug cells battery. be from we're the quarter, up, looking fuel as ProGen with have to expert, is And support in and We soon cells that, to it achieve a as when designed our start our easy cells to start that, to as XXX-kilowatt fuel -- of why works I so of well who that have Power. batteries. to sometimes. And testing ProGens already a ProGen, in possible. as mid people engine. wanting as We start them want they lot which range we're as be

cell. in easy, the rate? box, has Paul, philosophy add the X made and spend you're or X a on connections, put it So design fuel our ready-to-use

Paul Middleton

that the exciting into piggybacking guess for that is don't other on off what these a -- building most building technology base triple Andy have order think one way other I opportunities. a shared, -- aspects these platform into a resources Yes, those and applications to markets. me it applications. It's in to translate double of I in and we're to that other of makes take We easy leverageability advantage in very

that get X% And some other in hydrogen it's the opportunities in, spaces. that on the evaluate be probably areas like nominal incremental those of time, the anomalies strategic to will areas, in involved continue things there'll might of those we be so only X%, terms and in determined range. upper over to And that other are we've as be strategies, that some to nurture we but increase end talked about

Operator

with Stine Craig-Hallum. Eric from comes question next The

Eric Stine

just we hoping ENGIE. start with was could I

And You on any specifics of mentioned both that share agreement, had maybe it broad-ranging award it's X pretty like the X know a pretty already can you just I and that near-term. you sounds those, other areas? in but love I hear, how you're there just in, means to out? color kind quarter then a that be you of also see Any helpful. that's mean, What would would that playing

Andrew Marsh

Sure.

will So -- we let I back. expect Eric, step a take so me

named to systems again, will ability be and a for will that which actually that opportunity is includes a our You're this as vehicles should fueling as one our be around them have solutions, widespread. first handling station -- later. a second equipment deal we is with Plug And participated positioning is provide of in of both to support one, correct. This a The that close material for world. deployments And actually country handling the has world other fueling And equipment, fairly applications in. never material the it that announced quarter. in is ENGIE region fueling well

and will those in of that and I a our combination leveraging Plug $XX think million capability. two be expertise for well capabilities the Is broad helpful? combination $XX to million. products of it's over ENGIE's service And

Eric Stine

I'll that guess No, going just... stay forward. I question Yes. next is tuned Maybe helpful.

Andrew Marsh

of or will next them early first the both -- by Eric, the way of And will be half in year. be

Eric Stine

Okay.

deployments? For

Andrew Marsh

Yes.

Eric Stine

that on the two the announcements had changed maybe that I something like whether a curious stationary more then I left kind And major And so has Okay. out in that thought to my of that next this bit wrong described laid had applications. you're but is sounds extent? And -- read differently, just you misunderstanding, past just one I was or it guess it targeting. little some you in the

Andrew Marsh

Eric, I handling it you material to more obviously traditional the would But is a the wrong way say, customer. of explained have in past. large it with retail our I along must

Eric Stine

Got it.

third all leave Maybe guess the that's third -- And -- that have alone. you that announcement right. maybe discussed. customer that's the the I -- official of That I'll or your -- mega Okay.

Andrew Marsh

fourth as associated it, And Eric. got the hydrogen. You mentioned, is quarter, I with

Eric Stine

last All for me. one it. Got right. Maybe

clearly as you Hydrogen, I think that coverage that United to geographic that But part Hydrogen, mean know well. this targeted customers? the announcement out has you more you as potentially is roll that from that replicate I strategy. I mean, so your that do can aside greater something you to have Just strategy -- that is that United something of fourth

Andrew Marsh

of as your well partnerships the we've on Power were hydrogen you agreements of talked the as you providers one the -- in path for Tim Symposium and Plug one items at highlighted the question, the generation So the extensive if with as, side answer more -- to the looking items that Eric, about is production was together.

negotiations in But So we think to similar name every be I can type won't you provider are deals. in -- that. limited North just we for hydrogen are America, we

in think with in a be to expand call really I is to a there leveraging footprint as we for we green push just both are nontraditional work with that is market part this and of position, of in big before, hydrogen. I would that ownership our the natural players electrolyzers not generation renewable hydrogen with front in mentioned discussions customer partnership product. gas our to what And and plans a renewable

Operator

Our Souther & with from next question comes Christopher Company. Cowen

Christopher Souther

in subscription My get talked a was the more new about guys letter. hoping just that I I you program details little could first question, on bit the

kind and kind flow of of of that. recognized some quarter the subscription in were overtime? the examples through And how the as could P&L recognized? far what of GenDrive percent If you the kind give gets shipments of As

Andrew Marsh

want Paul, take do to that? you

Paul Middleton

Yes.

the So the a when over paying like when and they're -- vendor it's access to how financing you subscription, they're solution works, give doing our customer time. to a really it on answer and I try with access we guess, solution us simple

duration a leaseback. operating be financing it with the But lease deploy doing commercial that And finance goes period. projects, those them that rules, our of a recognition. we there'll into amount P&L them. recurring for And when banks So because sale we traditional qualifies revenue that over sale we're of accounting today, basically of and

the that the day monetizing project. X are off basically selling we equipment and revenue So associated recognizing with project

those in duration programs in for the our -- equipment will a recurring And X-year again, X, subscription revenues monetize so over show financials X, we'd as term have portion customer. revenue up of of we that. for from the of those then program, the And

Andrew Marsh

the over grow about under of add expect looking at in And wind been more kind that. me XX% our so solar fall program. let We've more like way decline XXXX, expect able and Chris, time of becomes to rapidly to the the and and we And interest rates subscription to wind competitive. as revenue rapidly. were solar, will we Plug

-- our this been and how program have over a to many scale. very rapidly out growing we more larger and aggressive about It revenue institutions the market. the believe more We at rapidly revenue that's more are this thinking because many margin We roll about for to with banks generate with grow Plug how we're how cash will position. will engaging Power, increase really

Christopher Souther

are FDA so? that waiting Okay. type it? Is And And then should next follow-up customers we the were of on program there solution? joining to how or pending other kind of for kind of them that the or quarter that, see kind of you do with any this over see

Andrew Marsh

you Chris. didn't what Who were hear I company was that? referencing,

Christopher Souther

The Fiat Chrysler.

Andrew Marsh

That is subscription model. not a

Christopher Souther

talk of XXXX think a on Europe little ENGIE you on to then, good have Okay, and got do about looking kind In Could bit other it. term, markets longer lot the that? be sense it StreetScooter guidance and a Do billing of international. of billion? touch Hamburg, of to strokes, seems you international focus that? that at of $X and make-up what broad you And a

Andrew Marsh

Europe. would I million primarily be in in range, would Sure. the put $XXX Chris,

Christopher Souther

Got it.

And and us... With one. give Okay. Walmart, you last can the then Amazon just

Andrew Marsh

you X/X think StreetScooter, we what with about it. represent if could have already And that of

Christopher Souther

Okay. the have with just could of and other kind far percent what then revenue sense customers of the give you Amazon us And Walmart, a of grown? is thus year-to-date, versus that

Andrew Marsh

next Chris. Probably will range, XX% it year. XX% the be in to And lower

Operator

[Operator Instructions].

comes from question next Arch Oppenheimer with Company. Our Colin

Colin Rusch

customers as that potential as may look Guys, addressable and subscription to positive at EBITDA particularly get capital business, Rusch. situation, talk the strategy reduce of your about evolve? cost the you with general, that then Colin And to and market? on you you actually can sustainable in enhance how It's pricing your

Andrew Marsh

long-term be to infrastructure, me Well, hydrogen may the at of there's Plug very, to the those opportunities years. for assets generation certain have could are extremely to example Colin, generators give for valuable. just available which Power. the -- assets. there an you assets those generating are here revenue industrial period. for subscription cash And valuable in gas And end company assets ability assets is very we And let hydrogen own that X, are like assets like round own Those

I those So our lot hydrogen the process associated value of thought a infrastructure long-term. is think of with especially

to we performance. get allow as that, pricing, have strategy the and work I numbers for our business that and XXXX, to think on today that our we pricing to goals in us support XX% EBITDA is of kind

Colin Rusch

the lower the of hydrogen. in in consumer ability are largest the and technology that of cadence then the Okay. of power side couple of terms what take seeing But offline. of just cost fuel terms you're an also, on drive then industry's to costs scale now a terms I reduction? guys And at there's in as in reduction. for what of Obviously, in of element have seeing this purchasing cost the hydrogen you follow-ups. sort evolution and I'll of you

Andrew Marsh

point, So me you Colin. reference give a let

U.S. is out XX to hydrogen rolled cost a member Power which the the give in they was felt I'm drive day, Plug the of range. where those also presented And of roadmap, participated I'm previous $X Advisory infrastructure in developing those to the in And presentations, total number which McKinsey to HTAC, including -- the the Technical companies Department companies. would of of about of what $X and to yesterday, one So was Committee both the scale Energy. Hydrogen is hydrogen you

hydrogen, per $X.XX range. puts if -- if X think about about back, step take you gallon. fact, against in about about you a that's hour effective especially think that you're kilowatt And $XXX the $X you comparing $X.XX when gallon per the gasoline, or if for So of you

Hey, it's a great report.

And to you roadmap a really coming if will there'll up it can I broad what companies website people days. know be. this the you forward So in McKinsey, there google, that a summaries And view in today. the U.S. up think be be hydrogen I the there will will executive thinking market link give are a description

Operator

with comes Roth next from Capital Partners. question Irwin Craig Our

Craig Irwin

pieces chart vehicles. presentation Post, out battery fuel one things Albany most of from Andy, for of electric had that demand by data he shareholder Deutsche showed range versus payload cells the of in So the was the how pencil and the Where you interesting economics versus right?

talked also lot UAV the translates years. to where Now environment, we've basic right, same you're a different next analysis opportunities important. aviation about pursuing and the and the over right, things the the grow of is extremely on-road, weight into But couple

You basis. future bought it or that update Power? in believe that as we unless for vision an about regular can in this us market. whole with business have you a hear there this you future a never on and lot don't would as for in anything share the maybe fits But EnergyOR where progress Is Plug plans far the a at

Andrew Marsh

that your start So think taxis, engaging to taxis, of and power aerial applications. be will I almost Craig, people to said, one being you vehicle going learnings will for the them not of and I weight XXXX. think and X more with space, overnight. think valuable programs that to applications That's talking description where vertical engaged is in real application was our be programs that XXXX, we is -- deeply about long-term. with aerial the which with And perfect. in issue extremely because be going surprise. That The cells. it's I'm you the in we people, for density on-road fuel a We're on-road team same -- I have were where of discussions quite customers are Those see identical

Craig Irwin

us there publicly? Is that. that an about learning to to line forward approximate see look for We Okay. time

Andrew Marsh

Yes.

usually months. tell would months, months but turn into I you So Craig,

months. say, in the I So next would X

Craig Irwin

Fantastic, fantastic.

Obviously, delivered question largest This is guys. buyer the the next right? as cost is focus intense hydrogen, So for you of of an about hydrogen. my

prices Over buy and you ready for we're produce looking can seeing the and were of that cell several it next to And some years the technologies coming us the have for best out on even at to within production, adoption next beyond ranging fuel there. whole ago, nuclear for purpose-built of any are hydrogen hydrogen your years, at hydrogen today? fairly market? best real Do there's possible ideas spectrum that production reactors So give around major tailwind customers cost X horizon to tossed number years There exotic above the prices. right? possible maybe what the the see the in a a particular

Andrew Marsh

HTAC. I can -- electricity, because I hydrogen. frame would to companies strain this, I activity to good mentioned of hydrogen. deal associated -- were there Tuesday or X-year. presentation use to that's and a Craig do put like you so to going presentations -- about of the Monday energy, I XX% how much electricity week And of in the say nuclear great as is a you time company say generate at Southern this listened on heat on of of the

X deal think good I probably said, activity of there's but that's nontraditional players. areas, I a more think in years I think being out. That than going X on

scale, pricing. of really could to utilities think it hydrogen, don't some be if at in which I see beneficial on but helping be the know You RNG I focusing

there's think solar with of leverage drive a interest electrolyzers down companies costs. to I to lot with it

tiered have think I miles. in XXX need though, sites to a best, work to that For within you

generation need You of facility XXX that miles customers. within a

on we're practical managing and our transportation bigger that near -- term on There's in that we're negotiating is, then also, negotiation, generation. keeping cost with the way what and of is as then Craig, way customers And on-site cost this and bigger variable. much site third, focused the a work the

upon a power higher transportation a us yesterday the that But see some be we're where I impacting in of the range help? probably it little -- in that as $X in eliminate a range. is be as is. the little next mentioned, us the I of depending we're $X year between I all with for cases, ownership can think doing probably out I assets. more to the variable on see, don't basis, It was I that a can depending as $X realistic. probably site to think that roadmap of more you'll cost. Today, to buying rolled on see $X Does lower, well most that kilogram

Operator

now floor ladies turn concludes gentlemen. back Mr. Thank the and Marsh. over question-and-answer you, This our to session. I'll

Andrew Marsh

for attend enjoy we And did Symposium, everyone. Plug not which you, who the have you minute video, Thank snippets, Power some a provides hope those few I it.

you call, big thank forward looking and fourth the coming. a to talking you, quarter So we conference quarter got to for

Plug Power (PLUG) 7 Nov 192019 Q3 Earnings call transcript