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Hyzon considers sale of fuel cell business to raise capital

Cash dwindling as SEC probe outcome clouds company’s future

Hyzon Motors would consider a sale or merger to get sufficient cash to keep operating. (Photo: Hyzon Motors)

Hyzon Motors would consider a sale or merger to keep its global fuel cell system business alive as it awaits the outcome of a Securities and Exchange Commission probe into possible phantom sales.

The spinoff of Singapore’s Horizon Fuel Cell Technologies went public via special purpose acquisition company Decarbonization Plus Acquisition Corp. in July 2021 and has cleared much of the underbrush that has hampered its business. It filed delinquent quarterly financial reports that returned it to the good graces of the Nasdaq, which had threatened Hyzon with delisting.

Hyzon reported a loss of $60.2 million or 25 cents per diluted share compared to income of $38.8 million or 16 cents a year ago. Adjusted earnings before interest, taxes, depreciation and amortization was negative $33 million compared to negative $28 million in Q2 2022.

Waiting on the SEC

But a shortage of cash and questions about whether it will face an SEC fine cloud its immediate future. Hyzon set aside $22 million to cover a potential fine. It spent $25.9 million in legal fees related to the investigation.

“We cannot predict the outcome or actions by the SEC,” CEO Parker Meeks told analysts on the company’s second-quarter earnings call.

Hyzon had $158 million in cash at the end of July. It expects cash burn of about $12 million a month or $65 million to $73 million in the second half. It projects a full-year 2024 cash burn of $110 million to $120 million. That would more than exhaust its current resources.


“Marketing conditions remain volatile. We continue to review all options available to us to raise additional capital including full merger and acquisitions,” Meeks said.

Hyzon is working on a fuel cell project with startup powertrain developer Hyliion Holdings, but executives of both companies demurred when asked about a merger.

During the quarter, Hyzon:

  • Deployed 10 fuel cell electric vehicles (FCEVs) and collected $2.9 million in cash.
  • Moved its 110-kilowatt truck program to production from prototype.
  • Received five 110kW FCEV truck orders from Performance Food Group expected to be delivered in late 2023.
  • Listed for sale its headquarters property near Rochester, New York, once the home of General Motors’ fuel cell operations.
  • Completed six single-stack 200kW Fuel Cell System B samples in addition to three completed in the first quarter of 2023.

Fontaine Modifications is Hyzon’s contract manufacturer for trucks based on Freightliner Cascadias. The asset-lite manufacturing helps Hyzon focus its spending on the single-stack 200kW fuel cell system that differentiates the company from competitors that typically combine two stacks to generate power.

Hyzon shares (NASDAQ: HYZN) closed Tuesday at $1.19, down 17.93%.

Editor’s note: Updates with closing stock price.

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Click for more FreightWaves articles by Alan Adler.

Alan Adler

Alan Adler is an award-winning journalist who worked for The Associated Press and the Detroit Free Press. He also spent two decades in domestic and international media relations and executive communications with General Motors.