Hexagon Purus ASA: Results for the second quarter 2024

Hexagon Purus ASA: Results for the second quarter 2024

Issuer

Hexagon Purus ASA

Key developments in Q2 2024:

* All-time high quarterly revenue of NOK 528 million in the second quarter of
2024, up 60% from the second quarter of 2023. YTD revenue as per the second
quarter of 2024 stood at NOK 935 million, up 63% compared to the same period
in 2023;
* EBITDA was NOK -97 million in the second quarter of 2024, compared to NOK
-89 million in the same period last year. This corresponds to an EBITDA
margin of -18% in the second quarter of 2024, up from -27% in the second
quarter of 2023. YTD as per the second quarter of 2024, the EBITDA margin is
-21%, up from -35% in the same period last year;
* The Hydrogen Mobility & Infrastructure (HMI) segment turned EBITDA positive
during the second quarter, delivering EBITDA of NOK 17 million, equal to an
EBITDA margin of 3%. This has also brought the year-to-date EBITDA into
positive territory for the HMI segment;
* Launched the Tern RC8, a zero-emission truck to be delivered under the long-
term agreement between Hexagon Purus and Hino Trucks for complete battery
electric vehicles, to be distributed through Hino's dealer network in the
U.S;
* Announced serial production partnership with Toyota North America for supply
of hydrogen storage systems and battery systems for Toyota's fuel cell
electric powertrain kit for commercial vehicles for the North American
market;
* Exited the quarter with order backlog consisting of firm purchase orders of
approximately NOK 1.0 billion, providing solid line-of-sight to full-year
revenue target.

"We have just reported yet another record quarter for Hexagon Purus, adding to
an already strong start to the year and keeping us well on track to deliver on
our targets. We continue to expect that full-year 2024 will be a year of
significant revenue growth and a large step in the right direction towards
EBITDA breakeven in 2025.", says Morten Holum, CEO of Hexagon Purus. "It is very
encouraging to see that our hydrogen business in Europe and North America is
already EBITDA positive for the first half of 2024, and we expect performance to
further improve towards year-end as volume and scale increase".

Hexagon Purus Q2 2024 consolidated financials

In the second quarter of 2024, Hexagon Purus ("the Company" or "the Group")
generated all-time high quarterly revenue of NOK 528 million, up 60% from the
corresponding period in 2023. Hydrogen infrastructure and hydrogen mobility
solutions were the main drivers of growth year-over-year. Year-to-date as of the
second quarter of 2024, accumulated revenue stood at NOK 935 million, up 63%
compared to the same period in 2023.

Total assets at the end of the second quarter of 2024 amounted to NOK 4,619
(3,818) 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 a higher activity level. Trade receivables
increased to NOK 401 (256) million in the second quarter of 2024 and reflects
the strong revenue growth experienced in the quarter. Inventory stood at NOK
611 (449) million, and the year-over-year increase is partly driven by the ramp-
up phase that the battery systems & vehicle integration (BVI) business is in.
The Company's working capital position reflects the Company's sustained growth
track-record, which is expected to continue going forward.

Net cash flow from operating activities in the second quarter of 2024 was NOK
-232 (-172) million, of which NOK -120 (-71) 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 -180 (-264) million in the
second quarter of 2024, of which NOK 133 million relates to investments in
production equipment and facilities related to the Company's capacity expansion
program and NOK 43 million relates to the final earn-out payment related to the
acquisition of Wystrach in 2021. Net cash flow from financing in the second
quarter of 2024 was NOK -5 (56) million. Cash interest payments and repayment of
lease liabilities amounted to NOK 26 (18) million in the second quarter of 2024.

Cash and cash equivalents stood at NOK 543 (973) million at the end of the
second quarter of 2024.

Hydrogen Mobility and Infrastructure (HMI)

Revenue for the HMI segment in the second quarter of 2024 totaled NOK 526
million, up 71% year-over-year. Year-to-date as of the second quarter of 2024,
revenue amounted to NOK 914 million, which represents growth of 69% compared to
the corresponding period in 2023. 62% (59%) of the HMI segment revenue in the
second quarter of 2024 stemmed from hydrogen infrastructure solutions, which
grew 82% 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 its strong growth momentum from the start of
the year and made up 28% (11%) of HMI segment revenue in the second quarter of
2024. This represents 335% year-over-year growth.

EBITDA for the HMI segment in the second quarter of 2024 ended at NOK 17 (2)
million, equivalent to an EBITDA margin of 3% (1%). Year-to-date as per the
second quarter of 2024, EBITDA was NOK 1 (-32) million, equivalent to an EBITDA
margin of 0% (-6%). It is highly encouraging to see that the HMI segment now has
passed the point of EBITDA break-even, as higher volume with solid gross margins
is increasing scale and fixed cost absorption, leading to improved
profitability.

Historical financials for HMI are made available on www.hexagonpurus.com
(http://www.hexagonpurus.com) together with Q2 2024 report and presentation.

Battery Systems and Vehicle Integration (BVI)

Revenue for the BVI segment in the second quarter of 2024 totaled NOK 2 (11)
million, and year-to-date as of the second quarter, revenue stood at NOK 21
million.

The segment's revenue development is largely in line with expectations, and any
significant revenue recognition related to the two major agreements signed for
delivery of complete battery electric utility and heavy-duty vehicles to Hino
Trucks and Daimler Trucks North America is not expected until the fourth quarter
of 2024.

Historical financials for BVI are made available on www.hexagonpurus.com
(http://www.hexagonpurus.com) together with Q2 2024 report and presentation.

Outlook

The Company's financial and operational performance in the second quarter of
2024 and year-to-date 2024 has developed in line with expectations, and the
focus for the remainder of the year is to increase the capacity utilization of
the new production footprint combined with operational improvements while
minimizing further capital spend. 2024 is an important transitional year from a
profitability perspective to reach Group EBITDA break-even in 2025. It is highly
pleasing and encouraging to see that the profitability trend in 2024 has
developed as expected and that the HMI segment is now EBITDA positive. This
gives further confidence to the Group's 2025 EBITDA break-even target. The
current capacity expansion program will be mostly behind us by the end of this
year, and beyond this, the level of investments in new production capacity will
be tempered going forward.

The hydrogen infrastructure and mobility offering is expected to continue to be
a key growth driver for revenue for the remainder of 2024. More significant
revenue recognition related to the Company's battery electric utility and heavy-
duty vehicles for Daimler Trucks North America and Hino Trucks is expected to
commence during the fourth quarter of 2024 and will be an important driver of
revenue growth in 2025.

The Company's order backlog, consisting of firm customer purchase orders, stood
at approximately NOK 1.0 billion as of the second quarter of 2024, with about
86% due for execution in 2024 and the remaining 14% for execution in 2025.
Combining the year-to-date revenue as of the second quarter of 2024 with the
backlog for the rest of 2024, gives 90% coverage of this year's revenue target.
The backlog for 2025 is expected to increase significantly during the second
half of 2024 as the planning for 2025 deliveries with the Company's major
hydrogen distribution customers will commence during the third quarter of 2024.
The backlog dynamic is 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.

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.

Presentation of the results

Hexagon Purus will present the Q2 2024 results at 08:30 CEST on Thursday 18 July
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 | [email protected]
(mailto:[email protected])

Salman Alam, CFO, Hexagon Purus ASA
Telephone: +47 476 12 713 | [email protected]
(mailto:[email protected])

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 Twitter 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

623797_HPUR Q2 2024 Presentation.pdf
623797_HPUR Q2 2024 Report.pdf