Business Strategy and Market Focus - Ballard Power Systems reported a focus on developing, manufacturing, and servicing zero-emission PEM fuel cell technology products for various applications, including bus, truck, rail, and marine[11]. - The company has a 49% interest in Weichai Ballard Hy-Energy Technologies Co., Ltd., which manufactures fuel cell products for bus and commercial truck applications in China[15]. - Ballard's strategic focus includes targeting medium- and heavy-duty mobility applications, with key markets identified as Europe, North America, and China[21]. - The company aims to leverage its core competencies in PEM fuel cell stack technology and advanced manufacturing to expand its market presence and improve competitive positioning[19]. - Ballard's investments in hydrogen infrastructure and decarbonization funds include a 10.4% interest in HyCap Fund I SCSP and a 1.5% interest in Clean H2 Infra Fund[17]. - The company emphasizes the importance of supportive government policies and existing partnerships in selecting target geographic markets[21]. - Ballard's business plan includes increasing volume scaling to lower product and production costs, enhancing long-term business prospects[22]. - The company recognizes the challenges of addressing multiple market applications simultaneously but believes it will lead to diversified revenue streams and improved returns on investments[22]. Financial Performance and Outlook - The company has maintained its internal controls over financial reporting without any material changes during the first half of 2025[8]. - The hydrogen and fuel cell industry has faced significant headwinds, including an uncertain macroeconomic outlook and rising interest rates, leading to a multi-year push-out of project developments[23]. - In 2024, the company initiated a global corporate restructuring aimed at reducing annualized operating costs by approximately 30% compared to the first half of 2024[27]. - The company suspended a proposed $130 million investment for a new MEA production facility in China due to market uncertainties and underperformance of the Weichai Ballard JV[29]. - The 2025 outlook for total operating expenses is projected to be between $100 million and $120 million, with expectations to be at the lower end of the range excluding restructuring charges[34]. - The company’s 12-month Order Book is approximately $84.3 million, derived from an Order Backlog of approximately $146.2 million as of June 30, 2025[35]. - The company plans to achieve positive cash flow by the end of 2027 through enhanced cost discipline and optimized working capital[46]. - Annualized operating costs are expected to be reduced by approximately 30% in 2026 relative to the first half of 2025[46]. - The company has approximately $550 million in cash and cash equivalents as of June 30, 2025, indicating a strong liquidity position[46]. - The restructuring process may result in revisions to the 2025 business outlook, reflecting ongoing market uncertainties[34]. Revenue and Expense Analysis - Ballard's Fuel Cell Products and Services revenues for Q2 2025 were $17.8 million, an increase of 11% or $1.8 million compared to Q2 2024[62]. - Heavy-Duty Mobility revenues reached $16.1 million in Q2 2025, up $2.9 million or 22% from Q2 2024, driven by higher sales of rail fuel cell products[63]. - The gross margin for Fuel Cell Products and Services improved to -$1.5 million (-8% of revenues) in Q2 2025, compared to -$5.1 million (-32% of revenues) in Q2 2024, reflecting lower manufacturing overhead costs[67]. - Research and Product Development expenses decreased by 29% to $18.2 million in Q2 2025 from $25.5 million in Q2 2024[69]. - Operating expenses totaled $25.4 million in Q2 2025, down 30% from $36.0 million in Q2 2024[69]. - Total Operating Expenses for Q2 2025 were $25.4 million, a decrease of $10.7 million, or 30%, compared to Q2 2024[73]. - Cash Operating Costs for Q2 2025 were $22.7 million, a decrease of $8.3 million, or 27%, compared to Q2 2024[74]. - Adjusted EBITDA for Q2 2025 was ($30.6) million, compared to ($35.4) million for Q2 2024, reflecting a $4.7 million improvement[77]. - Net Loss from Continuing Operations for Q2 2025 was ($24.3) million, or ($0.08) per share, a decrease of $7.2 million, or 23%, compared to Q2 2024[78]. - Heavy-Duty Mobility revenues for the first half of 2025 were $28.996 million, an increase of $5.245 million, or 22%, compared to the first half of 2024[82]. - Gross Margin for the first half of 2025 improved to ($5.1) million, or (15%) of revenues, compared to ($10.5) million, or (35%) of revenues, for the first half of 2024[87]. - Total Operating Expenses for the first half of 2025 were $50.6 million, a decrease of $20.8 million, or 29%, compared to the first half of 2024[91]. - Cash Operating Costs for the first half of 2025 were $45.9 million, a decrease of $14.9 million, or 24%, compared to the first half of 2024[92]. - Research and Product Development expenses for the first half of 2025 were $36.281 million, a decrease of $14.562 million, or 29%, compared to the first half of 2024[90]. - Adjusted EBITDA for the first half of 2025 was $(58.2) million, an improvement of $13.8 million or 19% compared to $(72.0) million in the first half of 2024[95]. - Net loss from continuing operations for the first half of 2025 was $(45.3) million, a decrease of $27.2 million or 38% from $(72.5) million in the first half of 2024[97]. Investments and Financial Position - The company has committed to invest £25.0 million in the HyCap fund, with £19.4 million already invested as of June 30, 2025[167]. - The company has also committed to invest €30.0 million in the Clean H2 fund, with €9.7 million invested as of June 30, 2025[168]. - The company completed a bought deal offering of 14.87 million common shares at $37.00 per share, raising net proceeds of $527.3 million in February 2021[177]. - Actual use of net proceeds from the 2021 Offering includes $127.4 million for research and product development and $40.0 million for investments in property and equipment[181]. - As of June 30, 2025, the company reported revenues from related party transactions of $249,000 for the six months ended June 30, 2025, compared to $2.2 million for the same period in 2024[175]. - As of June 30, 2025, total liquidity was $552.1 million, with no bank debt reported[157]. - The liquidity objective is to maintain cash balances sufficient to fund at least six quarters of forecasted cash used by operating activities, with a focus on revenue growth and improving gross margins[160]. - As of June 30, 2025, total contractual obligations amount to $77.4 million, including finance leases of $32.6 million and hydrogen supply agreements of $9.9 million[167]. Restructuring and Corporate Changes - The company initiated a global corporate restructuring in September 2024, leading to workforce reductions and decreased commercial expenditures, particularly in China and Europe[121]. - Restructuring and related costs for Q2 2025 were $5.9 million, compared to $0.2 million for Q2 2024, reflecting significant corporate restructuring efforts[124]. - The company recognizes the challenges of addressing multiple market applications simultaneously but believes it will lead to diversified revenue streams and improved returns on investments[22]. Impairment and Asset Management - The company recognized goodwill impairment charges of $40.3 million in Q3 2024, reducing goodwill to nil[193]. - Impairment charges on property, plant, and equipment totaled $106.8 million in Q3 2024, with a fair value impairment allowance of $105.0 million[193]. - As of June 30, 2025, the net fair value impairment allowance against consolidated property, plant, and equipment was approximately $91.6 million[194]. - The company updated its asset impairment tests multiple times in 2024 and 2025 due to indicators of potential impairment, including a decline in market capitalization[188]. - The recoverable amount of assets is assessed annually or whenever events indicate that the carrying amount may not be recoverable[189].

Core Viewpoint - Ballard Power Systems aims to achieve positive cash flow by the end of 2027 through a strategic realignment and a significant reduction in operating costs, primarily driven by workforce reduction and product portfolio simplification [2][6][7]. Financial Performance - For Q2 2025, total revenue reached $17.8 million, reflecting an 11% year-over-year increase, with heavy-duty mobility revenue at $16.1 million, up 22% year-over-year [7][8]. - Gross margin improved to (8%), a 24-point increase compared to the previous year, attributed to lower manufacturing overhead costs from prior restructuring actions [6][7]. - Total operating expenses decreased by 12% to $31.7 million, with cash operating costs down 27% to $22.7 million, driven by restructuring efforts [6][7][8]. Order Backlog and Market Activity - The order backlog at the end of Q2 2025 was $146.2 million, a 7% decrease from the end of Q1 2025, influenced by soft order intake and the removal of high-risk orders [4][7]. - Despite challenges in order intake, the company secured new orders, including significant marine orders, indicating ongoing demand in the market [2][7]. Strategic Initiatives - The restructuring plan aims for a 30% reduction in annualized operating costs relative to the first half of 2025, with the majority of restructuring charges expected to be recognized in Q3 2025 [2][6]. - The company emphasizes a focus on operational excellence and cost discipline to support margin expansion and limit capital expenditures [2][6]. Cash Position - At the end of Q2 2025, Ballard reported $550 million in cash and cash equivalents, with no bank debt and no immediate financing requirements, positioning the company well for future operations [2][6][7].

Core Viewpoint - Ballard Power Systems is undergoing a strategic realignment to enhance growth, market execution, and financial performance, led by new President and CEO Marty Neese, in response to current market dynamics [1][2]. Strategic Realignment - The realignment focuses on immediate market opportunities with proven product-market fit and aims to establish a sustainable business model emphasizing operational excellence and margin discipline [2]. - Key elements of the strategy include a commitment to innovation while ensuring commercial durability and delivering shareholder value through prudent growth [3]. Operational Goals - The company aims to achieve positive cash flow by the end of 2027 through enhanced cost discipline, market prioritization, pricing improvements, and optimized working capital [6]. - Ballard plans to reduce annualized operating costs by at least 30% in 2026 compared to the first half of 2025 through workforce adjustments and streamlined operations [6]. - The focus will be on fuel cell products with strong commercial traction, discontinuing non-core programs, and driving higher-margin offerings [6]. Financial Management - Ballard is targeting enhanced gross margins through lower product costs, value-based pricing, and improved customer service [6]. - The company will continue to limit capital expenditures and rigorously manage cash, with a focus on inventory optimization and working capital control, maintaining approximately $550 million in cash and cash equivalents as of June 30, 2025 [6]. Vision and Commitment - The company remains committed to the belief that hydrogen and fuel cells are essential for decarbonizing global mobility, ensuring readiness and focus in leading this transition [4].

Group 1 - The focus has shifted towards offshore drilling, supply industry, and shipping, including tankers, containers, and dry bulk [1] - The fuel cell industry is being monitored as it is still in its early stages of development [1] Group 2 - The individual has extensive experience in auditing with PricewaterhouseCoopers before transitioning to day trading nearly 20 years ago [2] - Successfully navigated significant market events such as the dotcom bubble, the aftermath of the World Trade Center attacks, and the subprime crisis [2]

Core Viewpoint - Ballard Power Systems has secured a significant purchase order for 6.4 MW of fuel cell engines from eCap Marine for deployment on two vessels operated by Samskip, marking a major step in the decarbonization of marine transport [1][2][3] Group 1: Company Overview - Ballard Power Systems specializes in zero-emission PEM fuel cells that enable electrification across various mobility sectors, including marine vessels [4] - The company aims to deliver fuel cell power solutions that contribute to a sustainable planet [4] Group 2: Partnership and Collaboration - The new order continues the collaboration between Ballard Power Systems and eCap Marine, which began in 2021, emphasizing their joint commitment to operational excellence and environmental stewardship [2][3] - eCap Marine focuses on innovative solutions for emission-free shipping, providing comprehensive services from feasibility studies to technical design [7] Group 3: Technical Details - The order includes 32 FCwave™-200 kW engines, which will be integrated into green marine propulsion systems to decarbonize routes between Norway and the Netherlands [2] - Ballard's FCwave™ is the first DNV type-approved fuel cell module for marine applications, ensuring compliance with international safety and design standards [3] Group 4: Support and Validation - The project is supported by ENOVA, Norway's government agency for energy and climate initiatives, highlighting the importance of public-private collaboration in advancing sustainable marine energy solutions [3]

Core Points - Ballard Power Systems will hold a conference call on August 11th, 2025, to review its second quarter 2025 operating results [1] - The live call can be accessed via a toll-free number or through a webcast on Ballard's homepage [2] - Ballard Power Systems focuses on delivering zero-emission PEM fuel cells for various applications, including mobility and stationary power [3]

Leadership Transition - Verdagy has announced a leadership transition with Rahul Bammi appointed as CEO, succeeding Marty Neese who is leaving to join Ballard Power Systems [1] - Neese expressed confidence in Bammi's leadership capabilities, highlighting his experience in growing companies and commercializing new technologies as essential for Verdagy's next growth phase [2] Company Background - Verdagy specializes in green hydrogen electrolysis, manufacturing Dynamic Alkaline electrolyzers that offer the lowest levelized cost of hydrogen (LCOH) and high asset utilization [5] - The company operates a hydrogen production plant and R&D complex in Moss Landing, California, focusing on advancing its technologies [5] Leadership Experience - Bammi has 25 years of experience in scaling global technology and clean energy businesses, with a proven track record in the semiconductor industry, where he doubled revenues and profits in several businesses and raised over $2 billion in capital [3] - As President, Bammi led go-to-market initiatives and developed a global pipeline of hydrogen projects and customers [3] Strategic Partnerships - Bammi emphasized the importance of partnerships with visionary investors like Khosla Ventures and Temasek, as well as industry partners such as Shell, TDK Ventures, BHP, and Yara for Verdagy's long-term success [4] - These partnerships are crucial for the commercialization of Verdagy's technology and products at a large scale [4]

Leadership Transition - Ballard Power Systems announced a leadership transition with Randy MacEwen stepping down as President and CEO after over a decade, effective July 7, 2025, with Marty Neese taking over the role [1][2] - The Board of Directors appointed Marty Neese, who has extensive operational experience and has served on Ballard's Board for the past 10 years, as the new President and CEO [2][3] Industry Context - The fuel cell industry is undergoing a period of rationalization and competitive realignment, necessitating a leader with a strong operational background to guide the company [3] - The company aims to adapt to changing industry dynamics, focusing on product cost reduction and operational efficiency [2][3] Company Vision and Strategy - Ballard Power Systems aims to deliver fuel cell power for a sustainable planet, focusing on zero-emission PEM fuel cells for various mobility applications [4] - Marty Neese emphasized the importance of optimizing operations, accelerating innovation, and unlocking long-term value for stakeholders as part of the company's strategy moving forward [3]

Core Viewpoint - Ballard Power Systems has filed a final short form base shelf prospectus and a corresponding registration statement to maintain financial flexibility, allowing for the potential issuance of various securities over a 25-month period, although there are no current plans to offer any securities [1][2]. Group 1: Filing Details - The prospectus qualifies the issuance of common shares, preferred shares, warrants, debt securities, and units comprised of these securities [1]. - The prospectus replaces a previous one dated May 9, 2023, which expired on June 9, 2025 [4]. Group 2: Future Offerings - Should Ballard decide to offer securities during the effective period, the terms and intended use of net proceeds will be established at that time and described in a prospectus supplement [3]. - There is no certainty that any securities will be offered or sold under the prospectus and registration statement within the 25-month period [2]. Group 3: Company Overview - Ballard Power Systems aims to deliver fuel cell power for a sustainable planet, focusing on zero-emission PEM fuel cells for various applications including mobility and stationary power [6].

Core Points - Ballard Power Systems held its 2025 Annual General Meeting on June 4, 2025, where all nominees listed in the Management Proxy Circular were elected as directors [1][2] - KPMG LLP was re-appointed as the auditor for the company, and the approach to executive compensation received an advisory vote of approval [3][4] Director Elections - Kathy Bayless received 84,684,573 votes (97.71% for) with 1,988,964 votes withheld (2.29%) [3] - Michael Chen received 84,336,534 votes (97.30% for) with 2,337,005 votes withheld (2.70%) [3] - Jacqueline Dedo received 78,793,325 votes (90.91% for) with 7,880,214 votes withheld (9.09%) [3] - Douglas P. Hayhurst received 78,041,127 votes (90.04% for) with 8,632,412 votes withheld (9.96%) [3] - Randy MacEwen received 84,892,738 votes (97.95% for) with 1,780,800 votes withheld (2.05%) [3] - Hubertus M. Muehlhaeuser received 77,913,248 votes (89.89% for) with 8,760,291 votes withheld (10.11%) [3] - Marty Neese received 84,225,903 votes (97.18% for) with 2,447,635 votes withheld (2.82%) [3] - James Roche received 84,789,591 votes (97.83% for) with 1,883,947 votes withheld (2.17%) [3] - Yingbo Wang received 84,290,998 votes (97.25% for) with 2,382,540 votes withheld (2.75%) [3] - Janet Woodruff received 77,861,876 votes (89.83% for) with 8,811,662 votes withheld (10.17%) [3] Auditor and Compensation Votes - The appointment of auditors received 88,666,862 votes (85.24% for) with 15,351,003 votes against (14.76%) [4] - The executive compensation approach received 76,971,303 votes (88.81% for) with 9,702,236 votes against (11.19%) [4] Company Overview - Ballard Power Systems focuses on delivering fuel cell power for a sustainable planet, enabling electrification of various mobility sectors including buses, commercial trucks, trains, marine vessels, and stationary power [4]