- Ballard Power Systems (TSX:BLDP) is planning layoffs as part of an overhaul to slash 30 per cent of its expenses, including two executives
- The hydrogen fuel cell technology maker announced what it called “a global corporate restructuring” with an aim to reduce corporate spending to maintain balance sheet strength
- This comes amid a slowdown in hydrogen infrastructure development and delayed fuel cell adoption
- Ballard Power Systems Inc. opened trading at C$2.36 per share
Ballard Power Systems (TSX:BLDP) is planning layoffs as part of an overhaul to slash 30 per cent of its expenses, including two executives.
The hydrogen fuel cell technology maker announced what it called “a global corporate restructuring” with an aim to reduce spending to maintain balance sheet strength.
This comes amid a slowdown in hydrogen infrastructure development and delayed fuel cell adoption. The scope of Ballard’s overhaul includes a reduction in workforce, a rationalization in product development programs, operational consolidation, reduction in capital expenditures and some working capital improvement initiatives.
“As this delay represents a significant headwind to our corporate growth plan, we are implementing a cost restructuring to moderate our investment intensity and pacing to better align with delayed market adoption,” Randy MacEwen, Ballard Power Systems’ president and chief executive officer, said in a statement. “We expect our restructuring measures to impact our global operations, yielding annualized total operating expense savings in excess of 30 per cent, with a substantial part of the annualized savings being realized in 2025.”
“As part of the restructuring, Paul Dobson and Mark Biznek will be departing as our chief financial officer and chief operating officer, respectively,” CEO MacEwen continued. “Paul will be succeeded by Kate Igbalode as our new CFO effective immediately. Mark will be succeeded by Lee Sweetland as our new COO effective at the end of 2024.”
As part of the restructuring, Ballard’s team anticipates a restructuring charge in Q3 2024. As of June 30, the company held $678 million in cash and cash equivalents, but still reaffirms its 2024 guidance, projecting total operating expenses (excluding restructuring and related costs) to be between $145 million and $165 million, with capital expenditures to range from $25 million to $40 million.
MacEwen added that this restructuring also includes a review of the company’s China strategy, given challenges in the Chinese fuel cell market and underperformance of the Weichai Ballard joint venture.
The team stressed that these cost reduction measures are not expected to impact product delivery and program execution required to fulfill any customer commitments.
Ballard manufactures zero-emission fuel cells for buses, commercial trucks, trains, marine vessels and stationary power.
Ballard Power Systems Inc. (TSX:BLDP) opened trading at C$2.36 per share. The stock has given back more than 55 per cent year-over-year and has fallen more than 67 per cent over the past five years.
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