April 19, 2024

Plug Energy (PLUG) CEO Andy Marsh brushed apart Wall Road’s considerations about the way forward for the hydrogen gas cell developer after PLUG inventory plunged on the corporate’s going concern warning.

“We’re fairly assured after we take a look at all the pieces,” Marsh instructed Yahoo Finance (video above). “If we take a look at our skill to handle this, we are going to cope. We’re speaking to folks about methods to try this. “We’re elevating much more money than we’d like. And we simply strive to try this prudently in order that our buyers are in a great place for the long run.”

Plug Energy shares fell on Friday and remained beneath strain on Monday. The selloff got here after the corporate reported weaker-than-expected outcomes and issued a “going concern” warning that it might not be capable to fund operations subsequent yr.

“Given the Firm’s projected capital expenditures and working necessities beneath its present marketing strategy, the Firm expects that its present money, available-for-sale securities and fairness securities will probably be inadequate to fund its operations for the subsequent twelve months,” the corporate mentioned wrote in a submitting launched Thursday. “These circumstances and occasions increase appreciable doubts in regards to the firm’s skill to proceed as a going concern.”

On Monday, Marsh painted a extra optimistic image of the corporate’s prospects, saying the corporate plans to proceed “prudently” in order that buyers are “in a great place for the long run.” He emphasised that the corporate has “no debt” and an “unlevered stability sheet of $5 billion.” Marsh additionally mentioned Plug Energy is contemplating various choices, together with debt financing to boost $500 million and slowing plant openings.

“I might be disingenuous if I didn’t say it is a bump within the highway,” Marsh mentioned. “However we have now sturdy demand from massive prospects.”

Plug shares have fallen greater than 70% because the begin of the yr as clear vitality shares come beneath extreme strain, pushed by considerations about increased rates of interest in a capital-intensive sector and falling valuations.

The story goes on

Marsh added: “If the market grew a little bit quicker it could be simpler.”

Within the third quarter, Plug Energy posted a lack of $0.47 per share, wider than Wall Road’s anticipated lack of $0.30 per share. Web gross sales for the quarter had been $198.7 million. The corporate’s internet loss totaled $283.5 million for the quarter.

Andy Marsh, CEO of Plug Energy, at an illustration. (GLOBE NEWSWIRE) (Globe Newswire)

In its earnings launch, the corporate blamed the loss on “unprecedented provide difficulties” for hydrogen, saying this contributed to quantity constraints and delays in provide. The disruption comes as Plug plans to fee two new inexperienced hydrogen manufacturing amenities in Georgia and Louisiana. Marsh mentioned the Georgia plant alone, scheduled to open later this yr, could be sufficient to ease the strain.

Following Plug’s outcomes on Thursday, JPMorgan, Oppenheimer and RBC Capital downgraded the inventory and lowered their worth targets.

“Whereas we imagine Plug Energy can overcome its present money stream points, the present working and capital markets atmosphere is difficult,” JPMorgan’s Invoice Peterson wrote in a be aware to purchasers. The analyst downgraded the inventory to Impartial and lowered his worth goal to $6 from $10 per share.

Akiko Fujita is an anchor and reporter for Yahoo Finance. Observe her on Twitter @AkikoFujita.

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