Norwegian hydrogen company, Nel, has reported a significant increase in its second-quarter order intake, with an 81% rise compared to the previous year. However, the company continues to face challenges in terms of profitability due to ongoing capacity investments and the delivery of larger and more complex projects.
Nel’s electrolyser division experienced strong growth during the quarter, and overall demand for their products is on the rise. This positive trend is attributed to increased production volumes and improved contract terms. Chief Executive Hakon Volldal expressed confidence in the company’s electrolyser pipeline, which consists of increasingly larger projects. As the projects grow in size, Nel anticipates that complexity will work in their favor, as it necessitates a greater need for expertise and experience in the field.
On the other hand, Nel’s fueling unit had a low revenue performance in the second quarter due to limited order intake in previous quarters. To address this issue, the company is making investments in service and maintenance, robustness, and reliability. They acknowledge that these activities will entail high costs going forward.
Regarding financial results, Nel recorded a net loss of 342.3 million Norwegian kroner ($34 million) in the second quarter, compared to a loss of NOK274.5 million in the same period last year. However, total revenue and operating income increased significantly to NOK475.1 million from NOK183.2 million.
Although there was still a loss, the improvement is reflected in the decreased earnings loss before interest, tax, depreciation, and amortization. It narrowed to NOK138 million from NOK197 million.
Looking ahead, Nel’s order backlog stands at NOK2.96 billion at the end of the quarter, up from NOK1.44 billion a year earlier. Additionally, the company’s total order intake increased to NOK428 million from NOK236 million.
Nel recently secured an 11 million euro ($12.4 million) order from Bondalti for 40 megawatts of alkaline electrolyser equipment for a project in Portugal. This signals further confidence in Nel’s capabilities and reinforces their position in the market.
