CLEVELAND, May 15, 2008 (PRIME NEWSWIRE) -- HydroGen Corporation (Nasdaq:HYDG), a designer and manufacturer of multi-megawatt air-cooled phosphoric acid fuel cell (PAFC) systems, today announced its financial results for the quarter ended March 31, 2008. HydroGen Corporation is currently in the development stage and is expected to remain so for at least the next several quarters.
Recent Corporate and Operational Highlights
* Start-up of Commercial Demonstration Power Plant. HydroGen
Corporation successfully started up its first full-scale
commercial demonstration fuel cell power plant at ASHTA
Chemicals, Inc.'s chlor-alkali facility. The start up of
the PAFC plant, which uses by-product hydrogen to generate
electrical power, positions the Company for near term
commercial deployment of its multi-megawatt PAFC plants
for the chemical industry. In the testing completed since
initial startup, the plant has demonstrated expected
performance during various start-up, operational, and
shut-down modes and power levels.
* Start-up of Coke Oven Gas Treatment Plant. HydroGen and its
project partners have successfully started up a pilot coke
oven gas (COG) treatment plant to process COG into hydrogen
of sufficient purity to support PAFC power plant requirements.
The pilot demonstration plant, which supports penetration
efforts into this target market segment, is located at a
potential customer's operating coke oven works. The pilot
plant is currently in the middle of a multi-week reliability
test run, and is processing gas directly from the potential
customer's coke oven operations. Preliminary results indicate
that the plant is effectively removing contaminants and is
producing a hydrogen fuel stream meeting HydroGen's PAFC plant
requirements.
* Progress on Multi-Megawatt PAFC Plant Design for First
Commercial Sale. The Company is working with an architect
engineering firm to complete engineering and design efforts
to support the Company's first planned sale of a multi-megawatt
plant to Samsung Corporation. The design package, which
includes process flow diagrams (including process simulations),
process and instrumentation drawings, equipment specifications
and data sheets, a preliminary hazardous operations study,
and development of cost reduction strategies, is on schedule.
* Next Generation PAFC Product Development Team Established. An
internal cross functional team has been established with the
charter to identify next generation fuel cell module and
balance of plant cost and power density improvements. Initial
design and sourcing strategies have identified an achievable
reduction of 50% in module costs. Similar work that targets
balance of plant improvements is underway.
* Development of Low Cost-High Volume Manufacturing. Progress
has been made in the development of lower cost, high volume
manufacturing approaches which will be implemented in
HydroGen's advanced manufacturing plant that is scheduled
to come on line in late 2009. A prototype of an automated
stack assembly line has been developed and successfully tested.
This equipment routes all completed stack components, including
plates and electrodes, and performs all cell and stack assembly
operations automatically. Additionally, the Company has placed
under test electrode materials manufactured utilizing a
newly-developed high volume catalyst deposition process,
using conventional, low capital cost equipment. In addition
to cost reductions, HydroGen expects improvement in quality
and repeatability of these manufacturing operations.
* Advanced Electrode Development. Development of advanced
electrode materials has progressed during the quarter. HydroGen
has accumulated over 20,000 cumulative hours of small scale
evaluation testing of first and second generation nano-catalyst
materials, including the lead cell which has operated for
nearly 4,000 hours. Advanced electrodes based on nano-materials
are expected to play an important role in cost reductions and
lifetime performance improvements in HydroGen's longer range
design and manufacturing plans.
2008 First Quarter Results
For the quarter ended March 31, 2008, HydroGen's net loss was $5.2 million, or $(0.41) per basic and diluted share, based on the weighted average of 12,769,904 common shares outstanding. This compares with a net loss of $3.1 million, or $(0.25) per basic and diluted share for the quarter ended March 31, 2007, based on the weighted average of 12,769,904 common shares outstanding.
The net loss for the quarter was due primarily to an increase in research and development expenses which amounted to $3.6 million in the first quarter 2008 compared to $2.3 million in the first quarter 2007. The increase in research and development expenses was due to the acceleration of the Company's efforts related to its commercial demonstration of its air-cooled phosphoric acid fuel cell module technology, as well as the ramp-up of manufacturing activities.
HydroGen's balance of cash, cash equivalents and short-term investments at March 31, 2008, totaled $2.6 million, as compared to a balance totaling $8.1 million at December 31, 2007. Spending on research and development for fiscal 2008 first quarter amounted to $3.6 million, increasing more than 55% over the first quarter of 2007. As of May 13, 2008, HydroGen had approximately $1 million in cash and will require additional capital to continue operations past May 30, 2008. The Company is in active discussions with our investment bankers and investors and is pursuing a private placement for financing. While the Company cannot assure that we will be able to conclude a financing, management is focused on concluding this financing in the timeframe necessary to continue operations.
"In the first quarter of this year we built on the progress made in 2007. We believe we have in place a strong foundation for further strategic, operational and technological development," said John Freeh Chief Executive Officer of HydroGen Corporation. "I am pleased with the startup and performance of the ASHTA plant thus far. This demonstration is one of HydroGen's most important achievements and, in conjunction with our strategic partnership with Samsung Corporation, positions us to become a global player in the growing distributed generation market for electricity and in the movement towards clean, hydrogen- and natural gas-based power generation."
About HydroGen Corporation
HydroGen Corporation is a manufacturer of multi-megawatt fuel cell systems utilizing its proprietary 400 kW phosphoric acid fuel cell (PAFC) technology. HydroGen's fuel cell technology, originally developed by Westinghouse Corporation, offers a multi-megawatt, zero-emission power generation product that supports the growth of industrial distributed energy. The Company targets market applications where hydrogen is currently available as well as applications that will utilize natural gas and other gaseous hydrocarbon fuel sources.
The HydroGen Corporation logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=3977
Forward-Looking Statements
Except for historical information contained herein, the statements in this release are forward-looking and made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are inherently unreliable and actual results may differ materially. Examples of forward-looking statements in this news release include statements regarding HydroGen's anticipated economically competitive fuel cell systems. Factors which could cause actual results to differ materially from these forward-looking statements include such factors as fluctuations in demand for HydroGen's products, HydroGen's ability to maintain strategic business relationships, the impact of competitive products and pricing, growth in targeted markets, the adequacy of HydroGen's liquidity and financial strength to support its growth, and other information that may be detailed from time to time in HydroGen's filings with the United States Securities and Exchange Commission. HydroGen undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
HYDROGEN CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONDENSED CONSOLIDATED BALANCE SHEETS
MARCH 31, DECEMBER 31,
2008 2007
----------- -----------
(unaudited)
ASSETS
------
CURRENT ASSETS
--------------
Cash and cash equivalents $ 2,641,075 $ 8,065,758
Accounts receivable 344,342 165,628
Other current assets 1,330,886 1,837,657
----------- -----------
TOTAL CURRENT ASSETS 4,316,303 10,069,043
Property and equipment, net 4,850,966 4,799,588
Other assets 66,433 66,433
----------- -----------
TOTAL ASSETS $ 9,233,702 $14,935,064
=========== ===========
LIABILITIES AND SHAREHOLDERS'
EQUITY
-----------------------------
CURRENT LIABILITIES
-------------------
Accounts payable and accrued
expenses $ 2,274,872 $ 3,094,511
Capital lease obligations,
current portion 104,268 102,804
----------- -----------
TOTAL CURRENT LIABILITIES 2,379,140 3,197,315
LONG-TERM LIABILITIES
---------------------
Capital lease obligations,
net of current portion 48,536 74,813
----------- -----------
TOTAL LIABILITIES $ 2,427,676 $ 3,272,128
=========== ===========
Commitments
SHAREHOLDERS' EQUITY
--------------------
Common stock, par value
$0.001, authorized 65,000,000
shares, 12,769,904 issued
and outstanding at March
31, 2008 and December 31,
2007. 12,770 12,770
Additional paid-in capital 43,540,416 43,180,779
Deficit accumulated during
the development stage (36,747,160) (31,530,613)
----------- -----------
TOTAL SHAREHOLDERS' EQUITY 6,806,026 11,662,936
----------- -----------
TOTAL LIABILITIES AND
SHAREHOLDERS' EQUITY $ 9,233,702 $14,935,064
=========== ===========
HYDROGEN CORPORATION AND SUBSIDIARY
(A Development Stage Company)
CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited)
NOVEMBER 11,
2001
FOR THE QUARTERS ENDED (INCEPTION)
March 31, THROUGH
-------------------------- March 31,
2008 2007 2008
----------- ----------- ------------
Grant Revenue $ 319,342 $ 436,065 $ 2,511,961
Research and development
expenses 3,552,349 2,290,489 18,566,509
Costs and expenses
(including stock-based
compensation expense of
$359,637, $120,053, and
$2,770,782 respectively) 2,027,169 1,556,244 20,969,513
----------- ----------- ------------
LOSS FROM OPERATIONS (5,260,176) (3,410,668) (37,024,061)
Interest and other
income 51,453 268,993 2,106,803
Interest and other
financing charges (7,824) (3,892) (806,091)
Charge for repricing
conversion price of
convertible debt -- -- (875,000)
----------- ----------- ------------
NET LOSS $(5,216,547) $(3,145,567) $(36,598,349)
=========== =========== ============
Weighted average common
shares outstanding
(basic and diluted) 12,769,904 12,769,904
----------- -----------
Net loss per share
(basic and diluted) $ (0.41) $ (0.25)
----------- -----------