November 10, 2004 |
Toronto, Canada [RenweableEnergyAccess.com] Public companies in the fuel cell sector enjoyed a 20 percent increase in revenues in 2003, up to US$243 million from US$203 million in 2002. For the first time in more than three years, revenues exceeded research and development (R&D) spending, which dropped 11 percent to US$204 million. But, according to PricewaterhouseCoopers' (PwC) 2004 Fuel Cell Industry Survey, the sector continued to experience operating losses, R&D spending, and technical, marketing and financing challenges.
The PwC 2004 Fuel Cell Industry Survey focused on the 2003 year-over-year
financial results of the world's 18 publicly traded companies whose primary
business is in the areas of fuel cell production, system integration and related
fueling infrastructure. Key findings are summarized as follows:
- The top two revenue earners in 2003 were Ballard Power Systems (US$120
million) and FuelCell Energy (US$34 million), accounting for 63 percent of the
total revenues of companies in the survey.
- Market capitalization (The total dollar value of all outstanding shares) for
the companies surveyed increased by 50 percent to US$3.6 billion in 2003 from
US$2.4 billion in 2002 -- outperforming the Dow Jones Industrial Average growth
of 25 percent during the same period.
- Cash flow from operations was negative during 2003 at minus US$222 million, an
improvement over minus US$311 million in 2002.
- None of the companies surveyed were profitable. Net losses decreased slightly
to US$367 million from US$384 million in 2002.
"While the financial results for the fuel cell sector were mixed for 2003,
there are encouraging signs that the industry may soon find its feet," says
John Webster, leader of PwC Canada's fuel cell practice. "The next two or
three years are critical for the sector to launch successful products as micro
fuel cells begin to trickle into the marketplace to meet the increasing power
demands of portable and hand-held electronic devices, largely driven by consumer
demand for greater functionality. This includes cell phones, lap tops, PDAs and
cameras."
The majority of the companies surveyed by PwC were focused on developing proton
exchange membrane (PEM) fuel cell technology and related fueling infrastructure.
Primarily designed for use in the transportation market, PEM-powered products
are expected to reach large-scale commercial production after portable and
stationary applications.
"The PwC survey revealed a continued trend towards consolidation and
strategic alliances within the fuel cell sector," said Alastair Nimmons,
PwC's 2004 Fuel Cell Industry Survey co-author. "Deals remained within the
same technology field as fuel cell companies strive to rationalize R&D and
administrative costs and consolidate financial, technological and intellectual
property. We also saw most fuel cell companies expand their customer base and
develop new supply chain relationships."
Environmental and economic factors continue to drive the need to develop fuel
cells, including the price of oil, energy security, climate change and air
quality. The growing energy demands of developing nations such as China and
India, conflicts in oil-producing regions, and governments' desire to protect
their citizens from the polluting effects of industrial development all play a
role in the fuel cell sector's evolution.
"We are seeing investment in fuel cells by large, well-funded
multi-nationals on all continents, with strong government support in Canada, the
United States, Japan, and a number of European Union countries," Webster
said. "With this public and private support, progress toward commercially
viable technical solutions will continue and fuel cells should become more
competitive with incumbent technologies."
Copies of the full survey are available on-line at the following link.
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