FuelCell Energy, Inc.

Ladies and gentlemen, thank you for standing by. And welcome to the Fuel Cell Energy fourth quarter and fiscal year 2020 conference call. At this time, all participants are in a listen only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this time, you will need to press star then one on your telephone. If you require any further assistance, please press star then zero and an operator will come back on to assist you. I would now like to hand the conference over to your speaker today. Mr. Sean Justin, please go ahead.

Thank you, Amy. Good morning, everyone, and thank you for joining us on today's call. As a reminder, this call is being recorded. This morning, Fuel Cell Energy released our financial results for the fourth quarter and fiscal year ended October 31st, 2020, and the earnings press release is available on the investor relations section of our website at fuelcellenergy.com. Consistent with our practice, in addition to this call and press release, we have posted a slide presentation on our website. This webcast is being recorded and will be available for replay on the company's website approximately two hours after we conclude the call. Before we begin our prepared comments, please direct your attention to the disclosure statement on slide two of the presentation and the disclaimers included in the press release related to forward-looking statements. The discussion today will contain forward-looking statements including, without limitations, statements with respect to the company's anticipated financial results and statements regarding the company's plans and expectations regarding the continuing development, commercialization, and financing of its fuel cell technology and its business plans. These forward-looking statements are intended to qualify for safe harbor from the liability established by the Private Securities Litigation Reform Act of 1995. All statements made on this call today, other than statements of historical fact, are forward-looking statements and include statements regarding our anticipated financial and operational performance. Forward-looking statements made on this call represent management's current expectations and are based on information available at the time such statements are made. Forward-looking statements involve numerous known and unknown risks, uncertainties, and other factors that may cause our actual results to differ materially from any results predicted, assumed, or implied by the forward-looking statements. We strongly encourage you to review the information in the report to be filed with the SEC regarding these risks and uncertainties. In particular, those that are described in the risk factor sections on our annual report on Form 10-K and cautionary statements and forward-looking statements in our quarterly filings. You should also review the section entitled cautionary statements concerning forward-looking statements in this morning's earnings press release. During this call, we will use non-GAAP financial measures when talking about the company's performance and financial condition. And according with SEC regulations, you can find a reconciliation of these non-GAAP measures to the comparable GAAP measures in this morning's earnings press release and reconciliation document posted on the investor relations portion of our website. For our call today, I am joined by Jason Pugh, Fuel Cell Energy's President and Chief Executive Officer, and Mike Bishop, Executive Vice President and Chief Financial Officer and Treasurer. Following our prepared remarks, we will be available to take your questions and be joined by other members of the leadership team. I would like to now hand the call over to Jason for opening remarks. Jason? Thank you, Tom, and good morning, everyone.

Thanks for joining us on our call today. We truly appreciate your interest in our company. One year ago, I hosted my first earnings call as CEO of Fuel Cell Energy, and today I am very proud of what the team has accomplished and the groundwork we are laying for long-term and sustainable success. In a year in which all of us face the serious challenges created by the COVID-19 pandemic, as well as social unrest in many parts of the world, we've made progress toward our long-term goals of profitable growth, developing and executing our backlog, and advancing our clean energy platforms, all of which contribute to the global energy transition. As we begin the second year of our powerhouse business strategy, we will continue to drive operational excellence by focusing on delivering value to our customers and stockholders, adhering to prudent capital deployment to support growth, and decreasing our overall cost of capital. We are focused on delivering revenue growth by commercializing our proprietary technologies to deliver differentiated value to our customers in capturing some of the significant opportunities in the energy markets that are emerging today and that will continue to develop in the years ahead. Before delving into results for the quarter, we have included an overview of our company shown on slide three for investors who may be new to our story. During fiscal year 2020, which ended on October 31st, we delivered double-digit revenue growth, achieving approximately $71 million in total revenue across our three largest categories, servicing licenses, advanced technologies, and generation, which together represent a diversified source of recurring revenue under multi-year contracts with investment grade customers. While we did not have revenue from product sales in fiscal year 2020, we are refocusing our efforts on new product sales and our ongoing market reentry in the largest fuel cell market in the world today, South Korea, as well as other global markets, including near-term opportunities in Europe and the Middle East. Like many, the COVID-19 pandemic impacted our operations and timing of our growth prospects throughout the year, but as we turn the page entering 2021, we are optimistic about the energy transition opportunities before us. At the top of the slide, we highlight many of our important customers currently using our technology platforms. These include a number of customers with our newest seven-year stack life fuel cells, many of which integrate combined heat and power capabilities that operate at extremely high energy efficiency levels, as well as other installations that enable microgrids, utilize biofuels, resulting in carbon neutral to carbon negative power, and can leverage multiple fuel types. Our SureSource fuel cell platform is capable of directly supplying hydrogen, and as an example of this, We are currently installing our first commercial hydrogen production platform in Long Beach, California, to power Toyota zero-emission fuel cell trucks and consumer vehicles. We have the ability to extend our carbonate fuel cell platform to deliver hydrogen through a process known as reforming, electrolysis, and purification, or REP. And with our solid oxide fuel cell platform, we will produce hydrogen through highly efficient electrolysis, long-duration hydrogen-based energy storage, and zero-carbon hydrogen power generation. Electrolysis, long-duration hydrogen energy storage, and zero-carbon power generation platform solutions will be commercialized with our solid oxide technology, which we expect to support the increasing penetration of intermittent renewable technologies such as wind and solar by providing a way to store the off-peak energy generated by renewables, and produce power at a later date on demand. Moving to slide four, as a company, we remain energized by our purpose of enabling the world to live a life empowered by clean energy. This purpose drives our strategic focus and the work we do. We believe consumers and businesses around the world will increasingly need always-on power. The electric grid continues to evolve around the world, but grid reliability is critical. And Feel So Energy is uniquely positioned to meet this challenge with our broad decarbonization product portfolio. We believe the future of clean energy begins with Feel So Energy. Next, on slide five, there are some key messages we would like to convey to you today. The first is to highlight the progress we are making toward completion of projects in our backlog as we execute our powerhouse business strategy for fiscal year 2020 revenue grew 17% to $70.9 million, which was primarily due to our expanded generation portfolio and growth in revenues from advanced technology projects, while we continue to maintain and emphasize managing operating expenses and positioning the company for growth. To put some mile markers behind our generation portfolio, we had 32.6 megawatts of operating power plants in our on-balance sheet generation portfolio at the end of the year, representing 25% growth from 26.1 megawatts one year ago. Growth in advanced technology stems from our joint development agreement with ExxonMobil Research and Engineering Company as we work toward commercializing our proprietary carbon capture solution. We continue to make progress against our circa $1.3 billion in contracted revenue backlog including completion of our 2.8 megawatt project in Tulare, California, utilizing our proprietary gas cleanup skid technology. This facility utilizes 100% on-site renewable biogas from the wastewater treatment facility to produce clean power for the San Joaquin Valley in California, one of the most productive agricultural regions in the world. We are near completion of construction on our next biofuel power platform in California at the San Bernardino Municipal Waste Water Treatment Department, extending our platform portfolio, utilizing on-site biofuels to produce carbon-neutral power. Fuso Energy's SureSource power platform will use methane-rich biogas that would otherwise be flared, wasting energy and producing emissions to produce clean, renewable, carbon neutral power. We are proud to note that our power platform is the only fuel cell power platform certified by CARB, the California Air Resources Board, for operations on biogas. We are also nearing mechanical completion of our microgrid project at the Naval Submarine Base in Groton, Connecticut. Once third-party interconnections and other safety-related work is complete, the platform will be ready for commissioning and commercial operation. We are excited to have the opportunity to deploy our microgrid platform in support of the United States federal government's defense critical electrical infrastructure objectives. We recently began early stage construction activity on 24.5 megawatts of additional projects, including the 2.3 megawatt Trigen platform that will deliver carbon neutral electricity green hydrogen, and produced water to Toyota at the Port of Long Beach in California, and our utility-scale deployments in Yapank, New York, and Derby, Connecticut. The Derby, Connecticut project is expected to deliver competitively priced Class I renewable energy and renewable energy credits from a compact footprint by remediating and repurposing a municipal brownfield in the city of Derbyshire. Managing through COVID-19 made 2020 a challenging year. First, I want to offer our prayers of support for the millions of families around the world that lost loved ones and for those who are currently battling COVID-19. I also want to thank healthcare workers, first responders, and the frontline workers at our company and around the world for their selfless sacrifice to show up to work every day. Thank you. As a company, We are proud of the actions we took to safeguard our team members and our community during the pandemic by temporarily shutting down our manufacturing facility and requiring all employees who were capable to work from home while maintaining full wages and benefits for team members unable to work from home due to their job functions. We made a number of improvements in our manufacturing processes and capabilities while implementing applicable social distancing protocols and restarting production in late June at an annualized production rate of 17 megawatts. Despite these challenges, we increased production after recommencing operations and expect to increase our production to an annualized production rate of 45 megawatts during 2021. The second key message I want to highlight is the progress we've made toward bolstering our financial foundation, strengthening our liquidity, and creating an opportunity to reduce our cost of capital. Mike will go into more detail, so I will just provide a few highlights, starting with our current balance sheet position. During fiscal year 2020 and early fiscal year 2021, we raised over $325 million in capital. In the fourth quarter, we completed an equity offering resulting in net proceeds to the company of approximately $98.3 million net of expenses. we had strong institutional and retail demand for our shares. And subsequent to the fiscal year end, we completed an additional equity offering, resulting in net proceeds to the company of approximately $156.3 million after deducting expenses. These subsequent proceeds allowed us to repay $87.3 million, representing all amounts owed to lenders and the agent under the Orion Credit Agreement. as well as pay $21.5 million owed to Enbridge under our Series 1 preferred share obligation. As a result of these activities, we significantly reduced our corporate debt and our unrestricted cash balance on a pro forma basis increased to approximately $209 million, $11.2 million of which represents cash formerly restricted by Orion that was released upon the payoff. Altogether, The results of these offerings provide us with an opportunity to reduce our cost of borrowing going forward and enables us to have significant liquidity to execute our project backlog and accelerate commercialization of our advanced technologies. And third, I want to highlight our goal of extending our leadership in sustainability and environmental stewardship. Markets around the world are increasingly looking for decarbonization solutions that drive the transition to clean energy address climate challenges, and enhance grid reliability. The energy transition is being further driven by regulatory support. Based on the initial policy objectives outlined by the new White House administration, we expect clean energy and climate policies in the U.S. to be a significant focus and receive broad support which is consistent with what we are seeing in markets across the world. To meet the growing need of clean energy, Fuel Cell Energy remains focused on developing and deploying our decarbonization product portfolio solutions for some of the largest global energy opportunities. One, distributed baseload generation, which is provided by our current SureSource platform. Two, distributed hydrogen generation using our carbonate platform. Our solution has the advantage of a clean water delivery capability, utilization of multiple fuel types while delivering hydrogen that can then be used as a feedstock in industrial applications, as a fuel for transportation, and for decarbonizing and or repowering existing gas turbine power generation infrastructure or blending down the carbon intensity of low carbon natural gas. This is the technology platform we plan to deploy at our facility in Long Beach, California. And it is the first of its kind in the US. And it is the first of its kind in the US. We are also developing a hybrid reforming electrolysis solution, REP, based on our carbonate platform to produce hydrogen from fuels and power when power coal production is not needed. Three. Long-duration hydrogen energy storage, power generation, and electrolysis using our solid oxide platform. The generation of hydrogen through electrolysis can enable a zero-carbon energy storage platform. Our hydrogen energy storage system is a closed-loop platform and is designed such that when it operates in reverse mode, it can leverage stored hydrogen to produce carbon-free power. Our differentiated technologies position fuel cell energy to capture meaningful opportunities in the growing hydrogen economy around the world and support increased penetration of intermittent renewable technologies. And fourth, carbon capture, sequestration, and utilization. We believe that carbon capture is key to making material reduction to the world's carbon footprint, enabling existing power generation infrastructure to remain in place and avoiding the need for much of the world to forego economic development. Fuel Cell Energy's carbon capture technology is the only solution that we know of that concentrates and captures carbon while simultaneously producing more energy and has the ability to deliver hydrogen from a single platform. Together with ExxonMobil Research and Engineering Company, we continue to develop our fuel cell technology that has the ability to concentrate CO2 across industrial applications such as coal and gas fire power plants, industrial and chemical processing, while also producing power from the fuel cell stack. Our technology also has the ability to extract and deliver carbon dioxide from our fuel cell platforms for utilization in a number of applications such as food processing and carbonated beverages, dry ice production, water purification, and more. In fiscal 2021, we plan to focus on commercially advancing new applications of our technology, including the demonstration of our solid oxide electrolysis platform, while continuing to execute on our backlog of projects by delivering our traditional distributed generation platforms. Said simply, we believe our technologies will position Fuel Cell Energy to be a leading energy platform solutions provider for the world's energy transition. Now, I will turn the call over to Mike to discuss our financial results in more detail. Mike?