- Earnings call transcript Q4 2022

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Operator

Good morning and welcome to FuelCell Energy's Fourth Quarter and Fiscal Year 2022 Financial Results Conference Call. All participants are in a listen-only mode. After the speakers' presentation, we'll conduct a question-and-answer session. [Operator Instructions] As a reminder, this conference call is being recorded. I'd now like to turn the call over to Tom Gelston, Senior Vice President of Finance and Investor Relations. you. Thank Mr. ahead, go Please Gelston.

Tom Gelston

you and joining thank for everyone, good on the morning, us and call you Thank today.

quarter have be results earnings As posted practice, our our a addition this FuelCell the and financial press morning in Form press report we our of release are recorded. being year and fourth release, our call. for our our This website recorded we replay conclude earnings slide www.fuelcellenergy.com. reminder, this is Consistent with section Energy after available our website. a call released call to in X on available website is presentation being and Investors and hours at XXXX, on the approximately webcast fiscal and on for annual will This XX-K our the

and beliefs regarding some within the our Before or hear of provided you begin, financing limitation: note to our and we meaning respect our XXXX. our please development, expectations, the technology intentions financial the cell of our business Commission continuing forward-looking information that will will of Securities Such statements with Exchange consist statements Act strategies. include express and and today of be and that fuel results, the with and anticipated statements plans of without commercialization, plans expectations future regarding and the

recently Commission, section our and Harbor on slide risks and with a filings and of from in risks the of implied filed or particularly available in Form report number forward-looking uncertainties. regarding materially Risk Exchange the because XX-K. described could those actual differ the Safe the annual of results Factors is Our future by statement, such More our uncertainties statements such most in Securities and presentation information

release those to financial we measures. During measures. the our GAAP reconciliation press of the for non-GAAP earnings you we our website discussing measures course be refer and the slide And presentation and appendix the to this call, certain will of to of financial

press www.fuelcellenergy.com earnings release of and today's website are copy Investors. at webcast under a presentation our Our available on

For President Officer; I and Mike Vice joined Officer. our Jason by Executive Executive Bishop, Chief President FuelCell our Energy's call and am Chief today Few, Financial and

questions by available members Following our to of the your the remarks, other will be I will hand joined we leadership be take remarks. call opening Jason to and Jason? team. prepared now for over

Jason Few

a our an like I in stationary platforms. Slide FuelCell of energy Energy Powerhouse in some good give everyone. sales leader strategy. FuelCell But on business and new on us for enable journey the Thank a minutes. FuelCell met our since morning, Energy on business to to our that operation execution energy. few to the In fuel clean on be always who over years, More developing we And results, XX a we by world Since best you, the of achieved announced joining as annual our call of empowered exciting Tom. is Thanks last progress for into X, cell Today, quarter, for strong anyone revenue product story. today. getting before be accomplishments we to result on continued overview might XXXX

technologies. focused we Our commercialize North around goal in Europe. scale America, operate Asia technologies our hydrogen. produce markets to we We And world as is decarbonize the power to and leverage are and entering proprietary and on our more

content requirements. facilities and Germany, distribution manufacturing located efficient creates States, meet expertise, local us and United an centers leverages our in Canada the helps to currently which Our are network, of

installations in which XX we have feasibility commercial the believe platform platforms. commercial operation, demonstrates of energy We our

produced fuel on-site. Japan, using we biofuels where deployed flexibility our Our platform was first in commercial in XXXX demonstrated

sources XXXX fiscal of Fuel and but XXXX, sales, from across orders revenue mix Technologies Generation, XXXX they Service four year to represent returned for we under with million had our revenue contracts. Cell. in Agreements, and revenue For modules $XXX categories: over we product fuel fiscal Product, year Korea cell recurring from revenue the XX diversified revenues multiyear no Advanced full year reported fiscal which XXXX, molten carbonate In of together

have agreement Ex for to provide purpose, that customers our by company, XX Fuel company's purpose Across market, our the agreements important as which sights other the markets, our keep to these in Works long-term existing It in megawatts provide with enabling new KOSPO shared new in POSCO South its where service shown X. We installations Middle select KFC delivered base to North Korea we Slide Energy a is directly. work directly and X, countries to for installed well and service Korea the in addition on January Energy a as modules existing Asian we our a already empowered to in sales Korea Africa is generating product we Starting Europe, clean Cell are South us. on of can committed energy. priority East, settlement world we America is with limitations the XXXX, POSCO also

shown events passion path carbon-zero, believe and the our Energy this is well FuelCell safe, be transition. and work. the our meaningfully industry to positioned our energy customers purpose assisting to drives on a will secure that focus in and us, part by have strategic We world recently As solution be impacted for every practical by of future

the X. business to Slide developments turn let's during the quarter Next, on key shown

and backlog, strategic the Over and against projects our technologies. product year, toward our new delivering execute orders we commercialization completing delivering of in our tangible fiscal progress agenda, to making continued

Cell orders during quarter, placed earlier a XX to of modules As I fourth total for initial this mentioned, we year. modules Works two delivered eight the the completing Fuel more Ex Korea

developing other commercial a scale in Korea in opportunities Korea our pipeline of We anticipation continuing organization are markets. to and of in Asia

December amended purchase agreement to we U.S. Base customers Navy plant Municipal Korea operate the is with Electric as Korea operations. the legacy with X.X its closed entered XX, In output year Technical next solely were December reduced Improvement stated, Connecticut will of Importantly, including On megawatts, commercial January previously megawatts XXth, we Submarine X the XXXX, Cooperative, regain this Energy of in approximately capacity Fuel previously access previously and announced Groton, have a platform West the into rated the power with a conjunction serviced by while a of goal full on commercial achieved transaction the X, I implemented announced market, platform allow a to starting at Bancorp. or we XXXX. CMEEC, that restated project over Plan Connecticut to with tax reaching that to an bringing at equity by operation, East Cell. We

project Scope ability U.S. FuelCell while of to Navy’s platforms the emissions. perform expect to to and at high this to objectives Energy's the continue efficiencies, Incorporation in X sustainability highlight contributing reduction We advancing the U.S. cell resiliency, grid base into the the microgrid while to supporting is stability expected Energy's energy efforts fuel platform to of to a increase of fortify and demonstrate supply. the project capacity platforms Military's FuelCell

solid milestone accepting and power electrolysis we for that for announced our are we platform oxide recently generation both Next, important orders the hydrogen applications.

our into Trinity repeat We entered customer have a Hartford, for also in first with oxide fuel cell College solid Connecticut. our contract

patented just we solid invest in minute. to full of We details a this oxide as More on R&D activities focus in our continue internal commercialization on our platform.

agriculture. factors. will and in will The our this be about Reactor to ammonia to support our for believe and in timing announced unfortunate platform produce have excited Modular electrolysis deploy and Ukraine oxide resolution an Small are intent we hydrogen security energy We this integrated to NuScale’s of solid Ukraine and Additionally, project solid application on predicated important conflict oxide further technology other the opportunity. the be of with

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application Under for joint Technology Advanced development EMTEC, commercialization and that agreement collaboration. Exxon and with a of and opportunities strategies FuelCell joint will commercialization Company we we're marketing capture. recently Next, progress our pursue to carbon continuing Engineering to Energy toward study in completed or our Technologies ExxonMobil define

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into further oxide platform, the about enough go design to Next, orders. in now are on like detail our and Slide progressed far we X, commercialization I'd cycle accepting which has solid that process customer

performed order Hartford, from Trinity quarters, well of with and events. has to validated that lab FuelCell’s Over broad units. XXX the has months, fuel National prototype oxide you allowed INL. has photographs several unexpected with a validation their us undergone including conditions Idaho at our we teams College updates, range specific a in of the provided in for test first past And move or independent independent In Connecticut, forward kilowatt in Labs solid cell. technology have This recent the stack testing our

future generation to Union very the the generation In first phase with space we European platform our targeted capacity. our are potential production for support opportunities we manufacturing oxide sub of sub and of part a megawatt Canada, as in increased power across expanding dedicated power addition markets We Calgary, geographic about and the currently megawatt of facility UK. offer the are additional in solid platforms excited

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$X platform attractive, electrolysis-produced important Next, and of characteristics one fuel most on is Energy’s factor our reliability, will while the to overall XXXX. the a is most more maximizing highlight give Slide strategy. flexibility, There costs, believe efficiencies, costs, the this electricity. we most oxide many to we among we platform hydrogen among advantages that chances hydrogen, X, available. technology We Efficiency of opportunity levelized cost fuel one The our and by implement flexible believe FuelCell cost including Energy’s is for presents the technologies and the solid that best cost a solid the technologies. of energy efficient solid believe the and technologies, offers the easy of to footprint the make U.S. oxide ways platform Energy achieving oxide colocation. best however, solid production electrolysis oxide of is option are FuelCell Department by efficiency, organizations hydrogen solid targeted of for facilities small competing kilogram lower effective Therefore, the oxide cell, of minimize per of the specific cell electrolysis

extended in In positioned now, energy platform nuclear I our addition, nuclear on developing generation on oxide with for over power for to operational source an temperature of we is the is And Mike? detail. the dates to electrolysis solid capitalize the to more excellent the well believe and will energy, this turn financial Mike opportunity. recognition renewed that focus electrolysis, third quarter call the utilizing hydrogen discuss results high

Mike Bishop

on Thank you, the good morning call everyone today. Jason. And to

results. heard you've I that from details will financial Now provide our some regarding Jason,

fourth million of fiscal of to XXX%. year fiscal $XX.X the year XXXX, we an quarter in reported revenues $XX.X total fourth compared increase million the of For quarter XXXX, of

under the year a XX, approximately revenue fiscal from compared to slightly of project in $XX Torrington, primarily quarter. comparable the and Connecticut. by compared recognized revenues of year contract module eight estimates, Product of a were estimates sales from to for Company consulting in modules fourth an in increase loss the related fourth the million operating facility manufacturing $XX driven revenue future ExxonMobil by XXXX cannot LIPA margin operating fiscal negative higher our recognized increased as fiscal $XX.X were construction offset quarter $X.X an year from revenues than Fuel was margins on product and to which million. and in year on are million Technology Korea on KFC, module related quarter ongoing offset additional loss to the quarter, $X.X sales Operating higher reflecting Works estimates carbon quarter to compared portfolio gross increased of or expenses to prior quarter, more $XX.X fourth $X.X contract million Toyota decrease compared oxide to our to prior million platform compensation $XX.X prior from million. costs Ex lower Power accelerating and the category. $XX $XX.X company and the the the the lower to the headcount. from January favorable the comparable Advanced million marketing Gross the to $X.X result million lower, drivers increased revenues XXXX. up KFC. future to negative fuel of in $X.X selling of These the from result the higher our completion quarter. year delivery $X.X sales, by fourth of million in Technologies exchanges future million Technology Cell service decreased Company rebranding prior our at commercial and higher $XX.X of solutions. future primarily $X.X to by development exchanges sales prior for to cell quarter. in year million increased no loss for service the we agreement gross variances, revenue and million Product in result output contract Looking the XXXX, months million the expenses of revenues of project, XXXX as Service fiscal during R&D the manufacturing Yaphank of and which Generation to loss to including due from fiscal Advanced expenses margin. to Engineering to higher The result module sales million $X.X driven totaled higher $X.X which a primarily resulted revenues $XX.X was comparable other marketing reduction offset in a partially solid of to cost of development revenues the government million. capitalized million million agreement increase $X to quarter Technology recognized continuously net under with ended as three quarter, loss due during the to contracts joint loss revenues in during recognized and our and XXXX fleet million was of Advanced efforts, year of revenues and teams, improvements module $XX.X million related expense increased comparable the generation were commercialization Island compared gross spending related invest in Administrative of and Authority size million XXXX million our increasing due efforts increase by in XX% that exchanges year costs a capture increased in year the Long The expenses. in of Net quarter $X.X be module or cost from the

additional fourth a was XXXX. the Adjusted earnings fiscal for the tax in negative provision adjusted $XX.X non-GAAP release. of million quarter was of the due the common XXXX. higher higher million of stockholders net due the attributable the common in since The of of share to to to the attributable fiscal number offset XXXX. the stockholders, income in partially loss fourth in the of slide October net shares, and per $XX.X of EBITDA weighted year fiscal $X.XX negative $X.XX year EBITDA common compared year million compared hand by the higher Additionally, graphically loss year fourth we the to average XXXX higher including year primarily The in negligible The measures in net to at to of totaled discussion in XX, reviewed the quarter at adjusted the XXXX $X.X quarter is fiscal fourth compared outstanding of of issuances of our share share backlog. fourth performance to appendix numbers fiscal XX fourth financial for shows per side amount turn to loss quarter our financial details years EBITDA end see the of Please and XXXX, some chart Slide XXXX. the quarters XXXX. Please quarter left just fiscal on

of XX, in quarter the the right XXXX of XX.X% not due finished decision $X.XX slide, development fiscal with quarter their was an backlog with driver October on a projects of we generation decrease economic Looking since and primary XX year project backlog fourth ongoing move megawatt the in is megawatt billion, the hand On update at XXXX. reduction Hartford given the The X.X current side the approximately investments of to X.X assets. to of the and forward our profiles. the in liquidity Slide

As total in equivalents cash of we by approximately cash million on of $XXX.X October blue XX, includes and had of represented lighter of darker the $XX and bar and the slide equivalents cash of the million by and blue bar. XXXX, This restricted approximately million. chart restricted the cash unrestricted cash equivalents center total cash, the $XXX represented cash

in shareholders. construction. spent spent to that only on as capital date long-term side company-owned a on under our grow portfolio which well at right slide, generation portfolio. of our project those drive completed assets Investments make to illustrating reflect the on a up development focus operating projects and hand clear of to FuelCell projects assets capital currently is total the with and chart Looking develop, continue will to value our projects our and Energy there We construct project intend as

XX, project which depreciation. October assets excludes our gross XXXX, totaled $XXX.X approximately of As accumulated million,

as XX.X megawatts portfolio XX.X Slide our XXXX. XX.X October operating projects of appendix includes megawatts and generation process. of of XX, assets in This of XX, this totaled As megawatts the detailed of presentation, on in assets

revenue. process to generation begin commercial expected they are in contribute higher projects operation, As

to projects additional commercial reach expect as and/or tax long-term Additionally, reinvest in capital seek as back transactions business. completion mechanical operation, these achieve equity to financing, debt further the as into well process we back-leverage

$XX the expenditures areas to expected fiscal continued portfolio. generation introduce products is per systems. range increase in oxide to solid and oxide drive includes cell for that upgrades research expect future megawatt and molten million year in the capacity electrolysis X in our test capital from target to to solid our new fiscal our an underway components, million XXXX projected year capacity facility our year are: for cell for solid order middle expansion, per will out of to capacity of expenditures, Turning manufacturing Slide business build is megawatts of of which expansion carbonate production XX between expected laboratories three XX, addition are we development, by investments and X facilities XX-megawatt expansion to both to Calgary, and I of of to growth. and production primary XXXX, the Canada investments The for year Capital facilities and $XX investments production solid oxide expansion of to production fuel the oxide and megawatt facility of fiscal The XXXX. in our make expected manufacturing year our

In currently support complement that is facilities additional and to evaluating addition potential anticipate. Calgary FCE for the we the manufacturing growth

be at range focused efforts million. continue long estimate to in We our research R&D R&D for fiscal of our hydrogen of expenses technologies, full energy including XXXX that Looking $XX $XX be storage. will year the year to commercialization million development, on duration and

this in under recurring power revenues. we purchase generation As growth portfolio long-term to expect our begin agreements, into projects translate in operation

to to out million, range construction. project the of estimates, to this that down portfolio, investment removal had $XX Hartford to October projects assets we prior under remaining of As from in XX, projects of development megawatts mentioned. And $XX the XXXX, XX.X the in million we I our and estimate the build due previously be of

XXXX, the of for exceed to XXXX. end XXXX year to by of of billion revenues targets, company. presented all to in year by revenues Day expect in in whereby result growth aggregate We for we our exceed $XXX these investments sustainable revenue revenue long-term million $X we At and of Investor fiscal the end March expect the fiscal

year we during a the revenue or And expect our turn IRA. now long-term with from passed see Reduction we discussed, as Act, Inflation Jason. XXXX. result, I to fiscal call will tailwinds to targets As And favorable back recently that, Jason revise the

Jason Few

strategy important of Thanks, serves first grow. on Slide grounded toward with Mike. our long-term we tenant is Powerhouse the strategy remain that feel quarter the each growth. achieving which XX, business I it’s guiding our as summary Shown

significant our We for growth are working business to for our markets opportunities see optimize technology. in achieving we where

We capacity. carbon The annualized technologies innovating. across our the innovate. the of our our scale our integrated history, human on-site scale. and us in, platform by never in our culture in Over economy achieving making our with to have believe we our participation total enable manufacturing, growth third, megawatts our on carbonate XXX hydrogen for And are Across second drive deliver and existing platform to plan conditioning XX-year is deepening we investing purpose. and optimizing We the organization. capital capacity molten extending operation, leadership progress stopped capture, the goal of our and and in of

Report. the transition. that are global want beginning dedication I remains achieving forefront published net-zero by we Scope the to delivering by energy X streams commitment which At first We our We services of Sustainability priorities. X Scope developing multiple Energy's our to emissions the achieving XXXX. products on diversified and by support year, reiterated XXXX in Today, emissions our revenue the of X and net-zero and FuelCell to reaffirm

Climate and believe leading Action United We are with Nations organizations goals impact. we the can we standard that the aligned

employees, equitable our to diverse, communities are live, a our and and we inclusive and safety focused to in commitments the the addition in we maintaining our environmental people In organization. work objectives, which of are on

my Before with takeaways XX. moving prepared I to on conclude some Q&A, Slide will remarks

to have We on strong a strategy. execute activities as sheet, to positions our which in projects well fund us balance as development growth commercialization

well established of sources funding, with multiple relationships have financing We providers. including

liquidity transactions, flexibility capital of to equity the transaction projects as recycled These be sources West as with our operations such completion. provide tax Bancorp. expanded our East allowing by reach recent scale have We through to

We contracts. billion of $X have from recurring with backlog revenues over long-term

rigorous that toward a We phase opportunity. thoughtful is and allocating next approach aligned of capital, market with the addressable growth have the so

in power market our global passage our technologies platform the to the And are FuelCell helping policies over achieve high deliver opportunity. have in by momentum, investments oxide in enhanced the expansion shareholder making generation market portfolio. are talent, in over gaining of turn an sub opportunities evidenced to important goals. and we play Q&A. position this will capture and efficiency transition the We the and capture I We're Act support solid megawatt over begin run. which United Global to Our investing States. coming electrolysis Energy global strong to energy believe to adds Reduction role we Inflation as product capacity, society it will the now our years, sustainability returns capability believe to long capacity

Operator

[Operator Instructions] Manav Our from first Gupta from question UBS. comes

Manav Gupta

both of guys. the the of lot is positive obviously cell developments leg fuel here. A Congratulations, The of LCC commercialization next the the development and side. electrolyzer on solid oxide

are confident that? some actually future? cell start in about through can or more How just you're from the solid orders If you how So, that. electrolyzer could getting walk talk on you achieving cells us orders that help more us fuel details you oxide

Jason Few

thank least thank fact have may some to then oxide Jason start have well. you Manav, for the platform, you megawatts, jump scale we With commercialization not quite pursue our our have This Trinity is respect which where of with order in started morning. opens smaller I'll and and for us that for enough, could members X.X team those the we opportunities call the and this as on for bit the as We're in really take we here our question, process platform joining orders are to Few. excited far indicated, in we at solid initial at maybe up because Connecticut most advanced platform. with the the kilowatt part the U.S., secured for aperture that about opportunity, that opportunities a XXX carbonate in molten previously domestically.

and platform INL we're done the both electrolysis work for already strong that and deliver On the to to doing same the has with our electrolysis. the demonstrated respect utilizing electrolysis demonstrate that our work really solid efficiencies we've been it's side, we've that oxide to capabilities, internally with performance

as our for be are, a on to scaling to company, is our we differentiation. we where now, right manufacturing platform really believe giving meet and going what our capabilities demand So focused is efficiency

and about So to we we've confident made, we progress for feel the ability that commercialization our very are, where platform. about scale manufacturing

Manav Gupta

next understand Perfect. rate of money you My if little you 'XX versus CapEx a these increase a a Help changer. is couple in should very the there game be commercialize is run here spending this that follow-up this will quick is businesses? is, all And as new the be good us case, for 'XX. whether and of IRA bit how years

Jason Few

ask that one. I'll Mike take to

Mike Bishop

And Good morning, for on, are as thank manufacturing. you call. solid hit Jason joining the oxide Manav. in investing we And

We in our we we the are indicated footprint size our Calgary. expanding of have -- in that XX-K,

that, with capacity come expansion. So will

chunk the so power as the thinking So CapEx carbonate that in then in carbonate we're the in for about 'XX as technology to at expenditures capacity parallel we're future as well. additional opportunity looking in We're that, the to going a related the facilities, facilities that. also growth looking around also carbon that, about preparing capture platform automation gen. In investing potentially for around U.S. we fiscal oxide in both to and the large electrolysis are of for solid well. as large think our also that Torrington, growth implementing and expansion well, prepared with And in

to is I future. confidence be obviously would out to So later that company into evaluate as and CapEx making on the that around this We'll but in that's the say expenditures we is 'XX, coming 'XX. in growth fiscal capitalize being fiscal in 'XX go the in meaningful plans investment hit able to laid CapEx we've fiscal gives us for future this where able this a the of growth. 'XX chunk from

Jason Few

And a $X in we just at in think that, add Day, out the intend laid to of market, mean, I IRA. you we our about maybe if to Investor what to trillion which light relook

now If you you we that market outlook. another and $XXX $X in capture, tag just hydrogen that opportunities between total that's our think storage, distributed take or viewed around XXXX. about at we billion about the and so carbon then if And energy available trillion

you the when and those is at EU look in do are opportunities. Asia. opportunities. smart make for to those to you pursue deploying think something kind that to look investments Canada's And us so happening to IRA, same going to certainly believe that that to IRA, then of to IRA, you response you programs similar capital those We and have we're go the aggressively is at after And have

Manav Gupta

Thank hoping are And Thank want and thank you the detailed difference. does questions people you let decarbonize you. you and need the for of for cheering to are taking you response. you know and the lot guys making world a succeed, to just a that

Jason Few

We appreciate you. really Thank that.

Operator

comes Our from next Gianarikas Genuity. from Canaccord question George

George Gianarikas

backlog the Hartford, just into on how from detail happened going first maybe -- what about could little bit forward? go and in just should more a of that So think we

Jason Few

Yes.

pick then a up ask maybe So, start here Mike I'll bit. to little and I'll

risk of we to agreement at the looked we able terms PPA. exposure when gas where as comply at a this significant being with as evaluated timing It's we our factor we did PPA, around at around had and the pretty decision done be looked we of to a we as that timing in interconnection originally prices. to a gas the So there's Hartford, prices. in and in times the became program. that project been a there's of is, factors And now, terms looked couple the One in interconnection of shift PPA questions to

manage restructure price that And exposure, little that had to being back said, not for move forward. didn't the for ways made that add to capital And conversations we've ability look our expenditure interconnection, we backlog. to financials gas look risk into in you that now sense this That right we've decision move to anything? we Mike, project, us risk so to as for now, and around a and program to decision make made have continue forward. want the to this at we'll bring the And to But we we continue do quarter. will if on the very we PPA. which can, reflected that our looked

Mike Bishop

larger Hartford at project the I different signed time. would was said. a echo Jason Particularly what

growth projects, for in this the And We about have capital to charge decision shareholders, the we into have investments. much project. quarter not investing took that in point made be project. just to will in We $XXX,XXX and the back that stop related these a invested a really, evaluated and want that and capital for reinvest return company our to at small and that to

George Gianarikas

a as gave any are that And as follow-up. just to there if trigen It could the you more? anything around deploy at you Wondering seems customers platform looking if platform trigen give the Beach. more us detail well? of bit about And Long detail other in also a there. little potential progress But

Jason Few

George. Yes,

with we So for we've on in now that, right that commissioning for started platform, trigen phase project Beach the Long Toyota. is the are where

consistent for platform, of or progress utilization acceptable as in hydrogen trigen purely making this at We RNG. hydrogen an opportunity using the our are producing of is plan overall, where distributed point. case way just whether port think, it are applications, applications fuel be the We with we the type this

hydrogen, infrastructure there's power platform opportunity initial market deliver terms think So for in the carbon-neutral water. in hydrogen is efficient to midstream for way. or in a we're that producing We where behind infrastructure this We ports. especially hydrogen, of green technology very is at there's distributed and think a ability the where opportunities the when you're

a even efficiency. energy low as where electrolysis But of $X going kilogram. that, if energy think our has be And to down going in difficult. because think to that's also or that's you're think the we big in a opportunity, where hydrogen great the hydrogen this high the the with cost creates have to somewhere $X.XX goal a distributed environment, as is prices, part high comes a we platform high And because platform to on -- price in of opportunity. even we So bring

help a hydrogen, process. So can economic produce we through this as can we deliver best whether decision we how the customer that hydrogen really for make see be they or electrolysis the and platform fuel where from it

Operator

comes from Our Company. & Osborne Cowen question from next Jeff

Jeff Osborne

the I repowering in the will or what I be could have questions. couple touch expectation is facilities a for on which you wondering was upcoming repowered year, if of service revenue?

Jason Few

for then Korea as Jeff, a around bit see thank want program you the talk do joining speak and stack a we call. maybe what little we well. can you. our Good little to for bit Mike, do replacements? service we morning, even how about and thanks And

Mike Lisowski

Yes, question. Jeff, the morning. you good is Thank This Lisowski. for Mike

at Our schedule. end the generation And portfolio product according according installed. life the the has assets of that's are overall technology degradation to really to replaced that that have we

on Those We have platforms now of keep that replacement. deployed to performance those have a five-year that life those a to technology, replacements them we schedules the keep rolling that assets. rolling we our coming life quarter-by-quarter And we view of seven-year work -- optimize frames number those replace forecasted. are we’ve basis. according We of on the and are over happening a plants then times view the a to

put will we I and for quantity guidance although the are that be replaced, haven't on and of schedule can fact to So when modules the yet 'XX. on say that out fiscal those track that we

Mike Bishop

is this bit Bishop, a Mike Jeff, to dimensionalize little And just more.

$XX back million were total revenues to had the $XX If in about million, you XXXX, 'XX the year back in and look million going in we at range service we $XX.X fiscal 'XX, to range. that

the years from So perspective. at if was project, And replacement KOSPO history, ago. installed certainly five you around example, light look just the 'XX year a for was service a

for So that up is replacement. module

higher transition to just other year, service that coming a mentioned, of as see as sites from So during that up one are expect on alone. there's revenue Mike you this And would that project the of well. course number

Jeff Osborne

is. my Can second you articulate question --

in your before Xst. after folks? You a January is. for potential but do shown what agreements be it alluded Xst, you unclear bit be articulate that service existing was would potentially alluding that with was being to potentially expire you like backlog, Can with some partner issues So the on existing January -- their signing up you positives to were Korean sites or revenue it need to what to to alleviated it sounded wait

Jason Few

Jeff. sure, Yes,

So that regained couple before, is that as settlement POSCO, the RFP to in we access largely things the to a opportunities. of about new the we've market. access reached we related market and an talked market to Korea One, And agreement the with happened. market,

able we have be opportunities, and settlement. the to So been with able in compete to those will do so since those

RFPs the what really impacted is have has call the the in the GENCOs for market. Korea factors that been government, standard the which the the volume in Korea they of to portfolio to released waiting really be framework in One market for sets Korean clean hydrogen MOTIE by of the or what the date pricing

existing for was though in that's The second part Korea. the of that fleet related the to settlement

and already to we XX, able module replacement in to For end sold with until about December market megawatts not were have That expiration will next now year, standpoint on opportunity those opportunity. At customers those what's replacement the been XXX a in of that LTSAs. years XXXX. January X, POSCO couple we those settlement of provision the work were be with replaced extending customers their agreement, terms that Energy, of of the work up which is the potential from on over customers those of the coming kind up based LTSA what's by to module this on versus of

settlement, modules. that third point to the no right that key I is of the maybe our longer other in manufacture make in POSCO dimension settlement, the that The would that, retain

modules or those Energy KFC LTSA LTSA, or does So that provided does by that be FuelCell Energy. rather POSCO FuelCell must

this opportunity we us. So for as see a great

we to Now, are work X LTSA. their are where need platform intentions a from with an understand customers really perspective, they to around those starting January what

we'll our So I that an suspect by to some more more opportunity would customers. fully color with provide after we've next to directly able engage had to quarter, be those

Operator

Sam comes question next from from Jefferies. Burwell Our

Sam Burwell

oxide absorb or should which positive more can as mean then, sales, there? more is forward inflect anything once you're product gross margins you when that fiscal stronger can costs get and or I see And biggest impactful mean is I talk maybe you've to it sense the commercializing the a from number with -- but the you I or a of really project them take gross products, most year-on-year? fixed the better What items out called and factors wanted territory? look costs that guys. you maybe 'XX, we mean, margins Toyota solid maybe higher about the enter call I are non-capitalizable already

Mike Bishop

Good take I This morning, question. Mike. that Sam. will is

and a hit that of at has then the level, maybe historically high on gross describe a there. how the few things brought about up So thought margins, you I'll company

from And course, that mentioned this. also we're statements, for company lines about margins the so out, from, XX% in perspective you long-term product range; our And of think north if range. targeting -- at and the Currently the But look the XX% really non-capitalized Advanced of we're we EBITDA revenue XX% really margins XX% typically to Toyota that's a financial depreciation revenue, XX%; agreements, when targeting related service, you generation, we’re So project. has from have company margins we research in statements, targets there of the then the Technologies, in and back to costs through. contribution financial four in margins EBITDA our you taking charges coming development. to

You've strong over XX% seen there in to range XX% the time. margins

is are those So, company But when we're think percentages I what over the long-term. laid we new would from the business that expect a at that Advanced level. about Technologies together to continue out we or perspective, either of high-level kind deals targeting the how just putting

Sam Burwell

I it thing and generation project in-service like kind that of fell of like Triangle noticed in seems the was a portfolio. of two Street out one then certainly or Okay, was Looked helpful. other UCI. One them

assets or could you what any if happened -- redeployed? be how color curious give might The of there just other and sort any on recovered

Jason Few

R&D our and that us. to local couple platform, essentially observation. over evolved of of project The high project we're it is certain project fuel out has the a Sure, here for cell. test that the type of the -- Street project efficiency from good past using years, in Triangle thanks more an We've down aspects that's to question right Danbury, where street

taking R&D project. have evolved revenue we're from more to site that where of an So, generation a just

felt it appropriate our So to backlog. that from remove generation

into They its Medical the end expansion We of the that term. the Center. an agreement project, a with reached On entered UCI going capital of the UCI UCI the project, Center. are owner Medical project the at through

in asset paid service arrangement that to be they redeployed Parts out of essentially fleet. an So essentially us asset. -- that we remove worked our are where to able

Operator

Our Riley. next question comes from Ryan B. from Pfingst

Ryan Pfingst

milestones August, hit to JDA with of like to the commercialization? would about move the that next would you talk Exxon to closer extended can that For help that some guys you

Jason Few

Sure.

the to the to platform generation and this technical a our move to address the to way demonstrate which only with cost we targets, will power able that to is market really are that but in carbon -- we continue project the hurdles not targets that forward as show achieve way continues targets So our opportunity. the there be capture leveraging technology capture

started we to Going we do through that look for completed will study, we'll result a that August, now and FuelCell. marketing Exxon demonstrations couple are do. marketing We there that marketing study, a to things technology a study. of of And customer between with opportunities begin as collectively the

will that Exxon actually this. technology optimization at set continue make that thing work as well that for as do Rotterdam we'll project respect decision the up with to will part other we'll of an facility demonstrate ultimately technology the where the Exxon on the to is The the

start largely agreement. And work answered. so that thus more a transition view commercialization. have to that working our it's the questions August, that of to will from we That's through of be demonstrations And extension and testing to we’ll technical toward begin and the the goal the all as company

Ryan Pfingst

then And time? the the on project oxide maybe And more think up order over there? then solid about broadly, with solid oxide one just in Trinity, we revenue should how ramp timing more

Jason Few

here we as Danbury facility, in the Calgary. unit in And we around doing our in slated that We're XXXX work for a are, Torrington project. So locally expanding project technology. speak, is as our also capacity Trinity facility

have a expand our larger space to manufacturing lease for We capabilities. on taken

And so, orders as And 'XX. we said, are taking in we very expansion we're focused manufacturing now. on

And would volume more expect in to so, XXXX. we be there

Operator

question Craig-Hallum. from Eric next from Our comes Stine

Eric Stine

modules would was an by you. XX mentioned, module And us could sales wondering, I to replacement was market thought previously, KFC you believe then likely you come about, those I So number had that you as update? give potential just year-end. I to know from the

we into think going maybe get about sales as you forward So module how calendar 'XX? year

Mike Bishop

you're to In Eric. laid that with the agreement thank KFC, the settlement morning, point. correct and KFC and for and there had out modules. fixed provision December is XX provisions. order we XXst. Energy by a Mike Good warranty until is a the question available could KFC observation. your And That This was an which you around additional Sure. price We agreement POSCO to fixed a option and

option of has been As exercise. today, not that

and as potentially go the will happen We as have module And opportunity over POSCO currently out forward talk to the going certainly Jason January Jason available customers replacements currently XXX company mentioned, customers of capture Xst, are megawatts to over Energy Korea, that that of mentioned, not announced time. in are after that. can

to and through getting that in in So to earnest 'XX. those discussions prepared work of Korea be for the beginning expect

Eric Stine

then And one. maybe second

I XX portfolio, of lot of And the had past the breakeven. kind generation you where at a was Just parts. megawatts. on In provided know moving saw you time, it I the believe

And whether so forward? and think ways curious, there's just play a you you 'XX in about going that can here out specific they or number give as then that

Mike Bishop

given opportunity XX about. at energy that an that of market one positive, that's as And business, breakeven generation a EBITDA business the well. here portfolio then you're pivot, has strong the take I we to Jason when the a at megawatt talked get and a think past pointed in EBITDA if I level. I'll from Eric. think Sure, the transition Since the so done could about that company bit potentially perspective think had as you

So investments. we've increased

expenses our up and we're also of solid and our gone commercializing So advantage oxide. opportunity, our R&D the as taking market SG&A have expenses

from the generation look and will been fleet it Korea, just and talking even. as into generation increase from And would I we Europe, the here, continues you contributions revenue grow. at opportunities look online, company the I opportunities it revenues the go contributions project in whether from at product about to increased coming of obviously generation totality now in service break So with revenues whether Groton our further the we've the to elsewhere this be U.S. portfolio also, XXXX. as see coming wouldn't that be point the leading at

of year, come million has about prior $XX portfolio $XX of revenue to from, we that compared kind at look million in you if this So year. where did the past

So contribution Toyota forward you've And seen can coming as of nice increase well. we from course, the online and look coming XXXX in to generation portfolio.

the characterize opportunities forward, go the So and of that's we sort I how breakeven business would as Eric.

Operator

next Our Satish from Wells from Praneeth Fargo. question comes

Praneeth Satish

Ukraine was what could power you for with like it you're maximum that the paired I doing source of I like would intermittent if plans kind wind solid developing. work power on Or elaborate efficiency? to And electrolyzer would applications with? an and what you solar? for a oxide wondering it need could your with this more you're guess, pair be source ratable long-term in

Jason Few

heat in We the Praneeth, high high-efficiency sets. keep one call electrolysis, fast a situation to good is of property of use so it morning. for think we then platform. are available. things could firm way store use be trace way to that when applications reverse thank ability around the platform in continue do our to in you to wind and to properties few with about is used our resources we amounts small respect and in solid the to of keep platform our where think oxide be electricity to then for high as the a intermittent those way used temperature in solar, it can of intermittent power a resources Yes, addition thermal which core capacity will joining actually like a when not temperature, as and ramp a hydrogen the and managing resources from in different thermal We've water either platform those intermittent to producing done electrolysis a generation we perspective up

convert at that efficiency large that or to we from So to Ukraine and electrical that's greater abundant of to as reactor nuclear way the is the a between temperature, anyone technologies there respect like that high waste electricity an today, differentiation that technology highly which hydrogen hydrogen. With to think advantage Alkaline, fact the an our ability heat the And to but and then significant take converting because And about a, able baseload example, nuclear, only scale platforms is XXX% efficiency efficient. we're in from scale electrolysis. be a generate of not between leverage exist and our waste low intermittent ability operate the operate feel to of even up nuclear use that really PEM the for as through already small a confident resources like the to we which at difference efficiency. heat without that temperature heat, difference material like can't waste nuclear resources,

very mineral-based think store that about than salt exists same today minerals confident a potentially think -- doesn't gas resources. similar but in It from it better produced. that to challenges feel tied to we with locally like And that. application, store both so, mining, our only a operate hydrogen other batteries, actually is have an important. regenerative. very to lithium-ion store ability we electrolysis and And we in think ability with intermittent hydrogen you not the -- is your caverns, a resources. resource geopolitical, issues using to type a also It that's rare and and we And earth nuclear natural is Because that's that hydrogen, that incredibly energy with much as

feel pretty we about So opportunity. that excited

Operator

Our from last question Parks Brothers. Noel come from Tuohy will

Noel Parks

with last integrating that sources, or you're intermittent in-house the that proprietary start are energy talking just integrating integrating about When on with developing of the envisioning with a third-party you're piece as technology is software hydrogen topic. you storage technology the EMF, medium, that, piece? I'll that

Jason Few

to I'll about question. Tony great ask little bit talk a that. Leo No,

Tony Leo

Yes.

software that in-house. We are developing

production between and for right where will in storage We're proprietary is through what evolved electrolysis works actually lab alternating are, a the example, and that product we're system, operating into like our that We we our with learning phase now, now be energy our that best, design. demonstrated system technology. we've control working reversible just at that operating hydrogen algorithms standard right and consumption, a now

Noel Parks

long and clearly, are want so ahead? learned I Any with path Groton, other experience was for forth. the hindsight second far implementations particularly Navy's the back a as did within to there, the a you benefit to step applicable procedures lessons processes, as on just slog of that the of some to have of including implementation

Jason Few

the our site the lessons of of practices we technology at that we to the look really process one can platform. core do, in we project to we from the host EPC how implementation, learn, with terms every to everything on engage of improve, how in construct No, a is itself use

learned Groton, all put And those lessons there's a our with will so of implementation and to work. certainly in we lot of certainly

around In platform management. of we how the those new addition lessons the look to and or we'll how deal technologies work new that, fleet, and at apply thermal to all it's lessons fleet, through those the improvements existing terms obviously on We've that we've of continue platforms. in this process, our made rather taken we're with across for innovations our to doing

going And indicated. a continue we've to And platform, we're we're so, to to at as that do certainly optimize lot learned. and glad things that we're COD,

Noel Parks

one last me. just And for

could what will that through as you that a far maybe you types great. about far down prospect as in? be they a talked study, learned the like JV bit think markets be might With and be having that kind the for of marketing been you Exxon of as it you've customers as Anything drill would

Jason Few

sure. Yes,

clearly boilers, represents of And industrial opportunity. work certainly for technologies, oil that go landscape, to what and and industrial need. industrial economics of that example, for that the the XXQ across willingness different IRA the customers segments, lot capture, enhanced use the interested there sequestration, So lot demand where you cut and beverage you to about that study that deploy thousands in number industrial opportunity. is from for food interest all the of across of people just you a carbon ton the a and industrial a we we the look there And in see I certainly, to that how gas confirmed a to at there's think interest was through -- the are learned $XX got customer very that when if work that really And everything petrochemical. that sector, gets we at sector think and of to and did and looked across

pretty And that. so, about I we're think excited

Operator

back to turn like would the I questions. further no call to over have closing We for remarks. Jason Few

Jason Few

you thank And joining us you. for thank Julian, again today.

growth on Powerhouse enabling business Energy joining great to on will strategy and and empowered The working by We We happy for And FuelCell about excited season. world everyone optimize execute and to continue a clean day. deliver our wish our thank deliver holiday a is returns. a joyous energy. you have team purpose to our of work

Operator

Thank concludes This call. participation. you today's your conference for

disconnect. now may You

FuelCell Energy (FCEL) 20 Dec 222022 Q4 Earnings call transcript