FuelCell Energy Inc. (NASDAQ: FCEL) reported a wider loss in the fourth quarter of 2019 due to lower revenue and a non-cash charge related to the decision to operate the Triangle Street Project under a merchant model for the next five years. The bottom line was wider than the analysts’ expectations while the top line missed consensus estimates.
Net loss widened to $36 million from $17.9 million a year ago while loss per share narrowed to $0.23 from $2.31 last year. Revenue dropped by 38% year-over-year to $11 million. Analysts had expected a loss of $0.11 per share on revenue of $11.51 million.
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The decline in the top line reflected the company’s previous decision to deemphasize Product sales to focus on utility-scale Power Purchase Agreement opportunities and grow its generation portfolio. This was partially offset by increased Generation and Advanced Technologies contract revenues.
For the fourth quarter, Generation revenues soared by 206% to $5.5 million as a result of the acquisition of the 14.9 megawatts Bridgeport Fuel Cell Project in 2019, which increased generation assets by 133% to 26.1 MW from 11.2 MW on a year-over-year basis.
Advanced Technologies’ contract revenues increased by 16% to $4.3 million due to increased activity, mainly in conjunction with the carbon capture joint development agreement with ExxonMobil Research and Engineering Company.
Service and License revenues decreased by 72% to $0.8 million due to the timing of planned service work performed in the comparative periods. Product sales plunged by 95% to $0.5 million primarily due to the inclusion of the sale of the Trinity College fuel cell project in the previous year quarter.
Contract backlog increased by 17% year-over-year to $1.32 billion as of October 31, 2019. This reflects an additional generation backlog from the Bridgeport Fuel Cell, San Bernardino, and the LIPA Yaphank Solid Waste Management projects, offset by the removal of the Bolthouse Farms project and revenue recognized during the period.
In a separate release, FuelCell announced its comprehensive strategy to strengthen its business and maximize operational efficiencies. This is expected to enable the company to capture future growth opportunities by executing its core business, focusing on customer relationships, delivering on and expanding its project backlog, and developing and commercializing new technologies with its partners.