Nel ASA: A fully dedicated electrolyser company

Rhea-AI Summary

Nel ASA announced its full commitment to the development and delivery of electrolysers for renewable hydrogen production. This strategic refocus follows the spin-off of its Fueling division, now listed as Cavendish Hydrogen on the Oslo Stock Exchange. The company, with 450 employees in Norway and the US, aims to enhance its PEM and atmospheric alkaline electrolysers while investing heavily in next-generation technologies. Nel secured significant funding from the US Department of Energy and partnerships, including a deal with Reliance Industries. Production capacity has doubled in Norway, and a new gigafactory is planned in Detroit. Q1 2024 results showed improved revenues and a positive EBITDA in the alkaline division.

Positive

• Full commitment to electrolysers for renewable hydrogen production.
• Spin-off of Fueling division to focus on strengths.
• 450 dedicated employees in Norway and the US.
• Investment in next-generation technologies.
• Secured US Department of Energy funding for AEM technology.
• Partnership with Reliance Industries for global market access.
• Annual production capacity increased to 1 GW in Norway.
• Planned gigafactory in Detroit with USD 170 million support.
• Improved revenues and positive EBITDA for alkaline division in Q1 2024.

Negative

• Potential risks associated with rapid technological advancements.
• Dependence on external partnerships for market expansion.
• Uncertainty in scaling up new production capacities.
• Financial reliance on significant government funding.

OSLO, Norway, June 12, 2024 /PRNewswire/ -- Nel ASA (Nel) (OSE: NEL). As of today, Nel is solely dedicated to developing and delivering world-class electrolysers to produce renewable hydrogen.

"Nel has almost a century of experience developing electrolysers and has installed thousands of systems around the world. Building on our unparalleled track record, we will, from now on, spend one hundred percent of our capacity and hydrogen know-how on developing and delivering the most reliable and energy-efficient electrolysers," says Nel's CEO, Håkon Volldal.

Nel's CEO says this on the same day Nel's former Fueling division was spun out and listed on the Oslo Stock Exchange as Cavendish Hydrogen. Volldal sends his best wishes to his former colleagues, who now focus on developing hydrogen fueling equipment for heavy-duty vehicles.

"Cavendish has a solid starting point with lots of relevant experience from the light-duty fueling market, a diverse and strong customer base, a competent organization and now also a dedicated board of directors. I am convinced they can succeed, and I wish them the best of luck," says Volldal.

After the spin-off, Nel will have approximately 450 employees in Norway and the US. These resources will dedicate all their time to delivering on Nels's ambition to offer the most energy-efficient and reliable electrolyzers in the industry at scale.

Accelerated development of next-generation electrolysers

In addition to further developing and improving its existing PEM and atmospheric alkaline electrolysers, Nel is investing heavily in next-generation pressurized alkaline and PEM technologies. The development of next-generation PEM electrolysers, a collaboration utilizing the deep hydrogen knowledge in Nel and General Motors' R&D departments, is progressing rapidly. At the same time, Nel's game-changing redesign of the pressurized alkaline concept has reached the prototype stage. Nel has also secured funding from the US Department of Energy to further develop its AEM electrolyser technology.

Strategic partnerships with leading industry players

Recently, Nel signed a technology licensing agreement with India's largest private corporation, Reliance Industries. Through this agreement, Nel will gain access to a rapidly growing market and cater to Reliance's captive demand for electrolysers globally. Nel has also partnered with a handful of Engineering Procurement and Construction (EPC) companies to offer turnkey 100 MW building blocks. These will be available on the market shortly.

Gigawatts of annual production capacity

During the last year, Nel has taken large steps to prepare the company for further growth. The annual production capacity at the fully automated electrode manufacturing facility in Herøya, Norway, has doubled from 500 MW to 1 GW. In addition, Nel is scaling up its annual production capacity to 500 MW at its PEM manufacturing facility in Wallingford, Connecticut. As in Herøya, all major production steps at the Wallingford facility will be automated. Moreover, several production processes previously carried out by subcontractors will be insourced and optimized. The company has also secured about USD 170 million in support from the US Department of Energy and the state of Michigan for its planned gigafactory in Detroit, where Nel will manufacture next-generation PEM and pressurized alkaline electrolysers.

The company's first quarter 2024 results showed that Nel is on the right path toward black numbers, and the alkaline division achieved an important milestone, reaching a positive EBITDA.

"Our revenues and EBITDA continue to improve, showing that the business model works with scale," Volldal said when he presented the results.

For additional information, please contact:

Kjell Christian Bjørnsen, CFO, +47 917 02 097

Lars Nermoen, Head of Communications, +47 902 40 153

About Nel ASA | www.nelhydrogen.com

Nel has a history tracing back to 1927 and is today a leading pure play hydrogen technology company with a global presence. The company specializes in electrolyser technology for production of renewable hydrogen. Nel's product offerings are key enablers for a green hydrogen economy, making it possible to decarbonize various industries such as transportation, refining, steel, and ammonia.

Forward-looking statements: This announcement contains certain forward-looking statements. By their nature, forward-looking statements involve risk and uncertainty because they reflect the company's current expectations and assumptions as to future events and circumstances that may not prove accurate. A number of material factors could cause actual results and developments to differ materially from those expressed or implied by these forward-looking statements.

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SOURCE NEL ASA

FAQ

What is Nel ASA's new focus?

Nel ASA is now fully dedicated to developing and delivering electrolysers for renewable hydrogen production.

What happened to Nel ASA's Fueling division?

Nel ASA's Fueling division was spun out and listed on the Oslo Stock Exchange as Cavendish Hydrogen.

How many employees does Nel ASA have after the spin-off?

Nel ASA has approximately 450 employees in Norway and the US after the spin-off.

What recent partnerships has Nel ASA formed?

Nel ASA has formed a technology licensing agreement with Reliance Industries and partnered with several EPC companies.

What are Nel ASA's plans for production capacity?

Nel ASA plans to double its annual production capacity to 1 GW in Norway and establish a gigafactory in Detroit with a 500 MW capacity.

How did Nel ASA perform in Q1 2024?

Nel ASA showed improved revenues and achieved a positive EBITDA in its alkaline division in Q1 2024.