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Hydrogenics posts US$5.67 million Q2 loss, revenues down 36%

Published: 19:27 14 Aug 2009 BST

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Canadian hydrogen generation and fuel cell products manufacturer Hydrogenics Corporation (TSX: HYG, NYSE: HYGS) reported a steep drop in revenues for Q2 and the first half, due to delays in contract decisions.


In its quarterly report released today Hydrogenics said revenues were down to US$5.5 million for Q2 and US$11.1 million in H1, representing year on year declines of 36% and 35% respectively. Gross margins also tumbled 7% year on year to 16%. Losses also deepened, climbing to 5.67 million in Q2 from US$5.38 million from the equivalent period of the previous year and to US$9.72 million for H1, up year on year from US$9.62 million.


The company’s order backlog amounted to US$15.3, more than half of which is expected to be delivered and recognized as revenue in 2009.


Hydrogenics struggled in the quarter amid less favourable market conditions, but the company projected an improved performance in the second quarter, expecting to secure new orders as deliveries get back on track.


"This quarter was more challenging than expected from an operating standpoint as contract decisions were delayed due to ongoing global economic conditions, impacting both revenues and gross margin. However, we continue to see a very active pipeline of opportunities across our business units, which we anticipate will lead to improved sequential results as the year progresses," said President and CEO Daryl Wilson.


Hydrogenics also said it was in talks with major Indian telecommunications companies, hoping to land substantial orders after successful completion of demonstration units in that country.


“Our bidding activity and customer interest gives us confidence in much better order intake performance in the second half of this year,” added Wilson.

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