Nel, provider of renewable hydrogen (H2) solutions, ends the year as the largest electrolyzer company in the world and with an all-time high order backlog.

The company has reported in its 2017 Annual Report revenues of NOK 298.4m ($38m) compared to NOK 114.5m ($14.6m) in 2016. This increase follows the acquisition of Proton OnSite as of 30th June 2017 and an increased interest in H2 solutions such as fuelling stations, electrolyzers as well as integrated systems.

At the end of 2017, Nel had an order book of approximately NOK 465m ($59.1m).

Costs of goods sold increased to NOK 163.6m ($20.8m). Wage and social cost expenses amounted to NOK 130m ($16.5m), and other operating costs increased to NOK 86m ($11m). The increased cost level follows the integration of Proton OnSite, increased business development activities and considerable growth initiatives. The costs were also negatively impacted by non-recurring project costs related to the deployment of certain installations requiring extra resources to fulfil the company’s quality standards.

To reduce the risk for adverse effects going forward, work is ongoing to improve routines and procedures and to further strengthen the organisation in areas like project management/execution, contract development and supplier follow-up.

Depreciation increased to NOK 36m ($4.6m). The increase is mainly a result of the depreciation of intangible assets related to technology, customer contracts and relationships arising from the purchase price allocation (PPA) tied to the acquisition of Proton OnSite.

Operating loss ended at NOK -117.2m (-$14.9m). Share of loss from associates and joint ventures of NOK 7.1m ($9000) is mainly related to ownership in, and elimination of, profit from sales to Uno-X Hydrogen AS, where Nel has a 39% ownership.

upwardtrend profit

Financial position

Total assets were NOK 1,725.7m ($219.4m) at the end of 2017, compared to NOK 762.9m ($97m) at the end 2016. The increase follows the acquisition of Proton OnSite. Goodwill totalled NOK 591.7m ($75.2), as of 31st December 2017.

Cash flow

Net cash flow from operating activities in 2017 was NOK -113m (-$14.4m), compared to NOK -34.2m (-$4.4m) in 2016, following an increased pre-tax loss and effects from working capital changes. Net cash flow from investing activities was NOK -219.3m (-$27.9), mainly related to the Proton OnSite acquisition, investments in the new facility in Herning and development costs throughout the divisions.

Jon André Løkke, CEO, commented, “Turning the page to 2018, we continue to focus on market development efforts, while increasingly moving into a mode of execution and scaling. Nel is evaluating several initiatives to strengthen the organisation in areas such as project management, execution, contract development, supplier follow-up, as well as operational excellence. These initiatives will serve us well as we consider capacity expansions in different locations. Capacity expansions are needed to accommodate larger orders in the future and will enable us to further reduce production cost. We are also working on concepts for fully automated, large-scale, production lines that would serve both these purposes. Cost reductions will ensure that we maintain an industry leading cost position and enable us to offer renewable H2 projects that are fully competitive with fossil-fuel alternatives. This is to everyone’s benefit.

“Altogether, our efforts are taking us closer towards our vision of Empowering generations with clean energy forever, whereby our technology allows people and businesses to make everyday use of H2, the most abundant element in the universe,” He concluded.