Danbury company exits 2018 with $62M loss
FuelCell Energy inched sales back upward in the final three months of its fiscal year, even as the Danbury company quietly put up as collateral its interests in a pair of power plants backed by the state, as part of a $100 million loan it secured in December.
FuelCell plants generate electricity through a chemical process the company likens to that of a battery, with Connecticut having subsidized the installation of FuelCell plants in Bridgeport, Hartford and elsewhere to make the total cost competitive with other electric generators like natural gas plants. FuelCell has its headquarters in Danbury under CEO Chip Bottone and its main manufacturing plant in Torrington.
Despite those state-backed contracts and others, FuelCell generated a $62.2 million loss for its 2018 fiscal year ending in October, including $14.1 million in its fourth fiscal quarter not including dividends accrued by investors holding preferred stock.
On Thursday, FuelCell reported sales of $17.9 million in the fourth quarter, up from $12.1 million in the third quarter though well below the $47.9 million it took in a year ago. Prior to the opening bell, shares were up 9 percent to 61 cents, with the issue trading at a third of its value of a year ago.
Last month, FuelCell secured a $100 million loan from Generate Lending to finance the manufacture of fuel cells, with the possibility of another $200 million in credit if approved by the Generate Capital affiliate. The deal’s provisions include a three-month period at the end of any installation under which FuelCell can either sell the power plant or refinance the loan; and if it does not do either, giving Generate Lending the option to take ownership of the plant in exchange for erasing any repayment obligation by FuelCell.
FuelCell has already drawn $10 million from the loan to finance construction of a 5 megawatt fuel cell for the Bolthouse Farms subsidiary of Campbell Soup, whose subsidiaries include Pepperidge Farm in Norwalk. FuelCell agreed to put up as collateral projects in Hartford and Derby awarded by the Connecticut Department of Energy and Environmental Protection, as well as three more with the Long Island Power Authority.
Alex.Soule@scni.com; 203-842-2545; @casoulman