Earnings Release • Oct 8, 2021
Earnings Release
Open in ViewerOpens in native device viewer
2020 Annual report
| Letter from the CEO |
|---|
| HydrogenPro in brief |
| Hydrogen and main end-user segments |
| HydrogenPro's offerings |
| Board of Directors report |
| Corporate governance report |
| Board of Directors |
| Management |
| Financial statements |
| Independent Auditor's Report |
Dear shareholders,
What a difference a year can make! We entered the year with hopes of using 2020 to raise capital in order to build on the position the company had been able to take during the last 2-3 years in the electrolyser industry. As the Covid 19 virus travelled fast to all parts of the world and countries in Europe literally went into a lock down situation, we felt fairly pessimistic about the prospects for a capital raise. However, the equity markets soon turned positive and in combination with a strong interest for ESG related companies, we initiated preparations for a public offering and stock listing during the summer. Through an equity issue in October, which was several times oversubscribed, we raised NOK 550 million to support our future development. This capital was intended to grow the organisation, invest selectively in supply chain and R&D and to provide general working capital.
With the funding in place, we embarked on a program to strengthen our human resources, both technical and administrative, we have filled the positions as COO and CFO and we have hired competent and experienced electrolyser talent as new colleagues.
Soon after the capital raise, we initiated negotiations with the owners of the electrode technology in Advanced Surface Plating ApS ("ASP") in Denmark who had been our project partners in a EU funded research project. In our view the ASP technology is critical in our efforts to increase operating efficiency of our electrolyser to approximately 93% of the theoretical maximum and thus enabling a production cost of about USD 1,2 kg per kilo by 2022. In a deal which was closed before Christmas, we became the 100% owners of this technology and through a share-based compensation, the previous owners of ASP are fully aligned with the interests of HydrogenPro.
During the year we continued to work with our contract pipeline and with new opportunities and in January 2021, we were chosen as a partner to Repsol for a possible 100MW green hydrogen project at its' Petronor refinery in Bilbao. The project is i.e dependent on Green Deal funding. We continued to work closely with both H2V in France and Mitsubishi Power and DG in the US to support and assist in maturing their green hydrogen projects. We have reported on the status of these projects on a regular basis and latest in an update to be provided on 30th April in connection with the announcement of this annual report.
Since the IPO in October we have intensified our work with reshaping our supply chain model from relying on fabrication of the electrolyser bodies in China to developing fully independent supply chains including electrolyser fabrication in both Europe and the US – while China will remain as a production hub for Asia and Australia/New Zealand. We have announced that we are seeking industrial partners in order to accelerate these plans whilst maintaining quality.
Finally, a word on the market. The number of prospects continue to increase and ambitions within green – or emission free- hydrogen grow higher by the month as stated by both nations and large corporates. We believe that allocations from some of the larger funding programs as "Green Deal" and "IPCEI" will turn out to become a catalyst for large scale investments decisions to be made late this year and next year.
We are pleased and proud to have you as a shareholder as we play our part in reshaping the energy future!
Mårten Lunde CEO
HydrogenPro aims to become a world leading designer, supplier and system integrator of alkaline electrolyser technology plants and solutions to meet the highest standard for safety, reliability and long lifetime.
Our main target is to produce green hydrogen at a cost which is competitive with fossil hydrogen. We deliver customized turn-key plants for large scale production of green hydrogen to large industrial clients. Modular and compact in design, our advanced hydrogen production plants offer efficient, renewable green hydrogen tailored to your needs.
The company was established in 2013 by individuals with background from the electrolysis industry which was established in Telemark, Norway by Norsk Hydro in 1927. Our organisation comprises an experienced engineering team of leading industry experts, drawing upon unparalleled experience and expertise within the hydrogen and renewable sectors. By combining our in-depth knowledge with innovative design, we continuously aspire to pioneer game-changing ideas and solutions to realise and maximise new opportunities in a smarter, sustainable, hydrogen powered future.
Hydrogen (H2) is a colorless gas, but the market typically distinguishes between the source of the H2, in particular to distinguish non-renewable fossil-based H2 from renewably-sourced H2.
Grey H2 is produced by methane steam reforming (CH4 + 2H2O –> 4H2 + CO2) in a high temperature and pressure nickel heterogeneously catalyzed process, without collection of the associated carbon dioxide.
Blue H2 is produced in the same way but the carbon dioxide is separated from the H2 stream and stored for example, geologically in depleted gas fields or buried under the sea.
By contrast, green H2 is produced by a fossil-free water electrolysis process (2H2O –> 2H2 + O2), where the electricity comes from renewable sources, such as solar and wind. Currently, the main uses for H2 around the world are ammonia synthesis (55%), chemical and petrochemical refineries (25%), and methanol production (10%).
Turquoise hydrogen is a by-product of methane pyrolysis, which splits methane into hydrogen gas and solid carbon. Some consider that this makes turquoise hydrogen a low-emission hydrogen choice — but this depends on the energy-hungry thermal process being powered with renewable energy and the carbon being permanently stored.
"Pink" hydrogen is hydrogen generated through electrolysis powered by nuclear energy.
"Yellow" hydrogen is used by some to refer to hydrogen made through electrolysis with solar power, alternatively referred to as electrolysed hydrogen made using power of mixed origin i.e. the mix of renewable and fossil power actually flowing through the grid.
"White hydrogen" is naturally-occurring geological hydrogen found in underground deposits and created through fracking.
In our view green hydrogen is a key to a climate-friendly future. For industry, green hydrogen can be a real opportunity to achieve climate neutrality. To make use of this potential, it is important to take active steps to develop hydrogen technology and commercially develop sustainable business models across the entire value chain for hydrogen gas and gas-to-liquid.
The majority of costs stem from the cost of renewable power. The last few years we have seen a rapid growth in renewable capacity and this strong trend is forecasted to continue. Hydrogen will be needed to utilize the growth in renewables and the forecasted drop in renewable power prices will make green hydrogen competitive with fossil alternatives.
Awards by the several public financing programs, incl. IPCEI and EU Green Deal, are likely to be a catalyst to realize industrial scale projects going forward.
Refineries use large amounts of hydrogen in the refinery operations which is typically generated from fossil sources (natural gas).
Europe's hydrogen production is currently around 9 million
tonnes per year (Mt/y), according to the International Energy Agency (IEA), around half of this hydrogen is consumed by refineries.
The refinery companies are increasing their focus on green hydrogen projects, helping to reduce their carbon footprint. The introduction of hydrogen removes sulphur from raw materials for gasoline production, diesel oil and gasoil. Raw oil contains a number of natural sulphur compounds. Hydrogen is used for this, and the process produces hydrogen sulphide (H2S) which ends up in the refinery's fuel gas. Direct combustion of fuel gas that contains H2S, also known as "sour gas", results in major emissions of SO2 (Sulphur dioxide) from refineries. The fuel gas is therefore purified before being combusted in the refinery's combustion plant. The carbon emissions come later, when engines are used.
Ammonia—one nitrogen atom bonded to three hydrogen atoms—may not seem like an ideal fuel. Its energy density by volume is nearly double that of liquid hydrogen—its primary competitor as a green alternative fuel—and it is easier to ship
and distribute. You can store it, ship it, burn it, and convert it back into hydrogen and nitrogen. Around 40% of Europe's hydrogen production is consumed for ammonia production. Companies around the world already produce \$60 billion worth of ammonia from natural gas every year, primarily as fertilizer. Hydrogen from electrolysis could in the long term take large parts of this market, which today is covered by hydrogen from natural gas.
Steel is one of the largest industrial sources of greenhouse gases and responsible for roughly 7 to 9 per cent of all direct emissions from fossil fuels, according to the World Steel Association.
More green steel production is expected in the future due to, among other things, help from hydrogen from electrolysis. The potential use of hydrogen as a reducing agent is many times larger than the amount of H2 used in the ammonia industry.
Gas grid is more cost-effective than an electricity grid; for the same investment a gas pipe can transport 10-20 times more energy than an electricity cable. Europe has a well-developed gas grid that can be converted to accommodate hydrogen at minimal cost.
Several European studies have concluded that up to 10 percent hydrogen by volume can be mixed into natural gas, but that concentrations above 2 % by volume will/may (recommendations differ) entail further necessary changes to components in the natural gas network (subsurface storage, analysis equipment) and equipment that utilises natural gas and gas turbines. The capacity for mixing hydrogen in gas pipelines for export of natural gas to Europe may also be an option from Norway, Russia and North Africa. The hydrogen/natural gas mix may either be used directly like conventional natural gas, or the hydrogen may be separated from the natural gas and used as hydrogen. To combust these mixes, the challenges will be even more pronounced the higher percentage of hydrogen by volume is fed into the network regionally and between countries.
Electrofuels (drop-in fuels) could supply a large amount of aviation's growing e nergy needs. To meet half of Europe's 2050 aviation's energy needs would require 24 % of the current European electricity generation. Combining CO₂ and H₂ then results in the synthetic fuel, which can be gasoline,
diesel, gas, or even kerosene. Drop-in jet fuels have aggregate properties that are essentially equivalent to those of conventional (petroleum-based) jet fuels. As such, drop-in fuels are fully miscible with conventional jet fuels, and they are fully compatible with existing aircraft engines and the existing fuel infrastructure (tanks, pipelines, equipment, etc.). Present studies suggest that the fuel itself (excluding any excise duties) could cost between 1.00 and 1.40 euros a litre in the long run.
In 2019, the International Renewable Energy Agency (IRENA) predicted that the need for liquid fuel for all transport needs will be quadrupled from 2015 to 2030, when this will about 500 billion litres, to then rise all the way to 1120 billion litres in 2050. In IDA's Energy Vision 2050, it is also noted that electrofuels will be a key fuel everywhere electricity and batteries cannot do the job. This means that the majority of private automobiles will likely be pure electric cars, while a smaller number will run on electrofuel. With regards to ships, trains and aeroplanes, electrofuel will comprise a much larger proportion of fuel in tanks in the future. Upscaling the power fuels opportunity to meet 20% of global aviation fuel demand, would require 250 GW of electrolyser capacity, supported by a renewables fleet of 600 GW.
HydrogenPro has developed a unique 100 MW system.
HydrogenPro had revenues of NOK 26.7 million and an operating profit of – NOK6.0 million. The cash balance at year-end was NOK 506.1 million.
HydrogenPro was listed on Euronext Growth on 14 October 2020 raising gross proceeds of approx. NOK 550 million (the "Primary Offering") and a secondary offering through a sale of shares totalling NOK 50 million.
On 20 December 2020 HydrogenPro announced an acquisition of 100% of the shares in Advanced Surface Plating ("ASP"). The acquisition was completed on 22 December 2020. ASP is the owner of a proprietary next generation advanced electrode technology which has the potential to improve the operating efficiency of HydrogenPro's high pressure alkaline electrolysers with up to 14%, translating into a projected cost of USD 1.2/kg by 2022. HydrogenPro acquired the shares in ASP for a consideration consisting of 600,000 shares in the Company, as well as a potential additional cash consideration of up to NOK 6 million if certain targets are met.
In line with the growing market HydrogenPro continues to scale up the organization through hiring new management resources and personnel with extensive electrolyser and project experience.
HydrogenPro had revenues of NOK 26.7 million in 2020 which mainly consisted of engineering work related to Mitsubishi's project in the US and the H2V projects in France.
Operating expenses amounted to NOK 32.6 million, whereof NOK 6.3 million in raw materials and consumables used, NOK 11.0 million in payroll expenses, NOK 15.0 million in other operating expenses and depreciation & amortization expenses of NOK 0.4 million.
Operating profit was NOK - 6.0 million.
Net financial income and expenses amounted to NOK - 2.3 million, which consisted of NOK 1.9 million as financial income and NOK 4.2 million as financial expenses (incl. a disagio effect of NOK 3.5 million)
Tax on ordinary result was NOK 7.7 million which included a tax effect of the Company's accrued deferred losses of NOK 7.7 million which was reversed in Q2 2020.
Annual net profit for the year ended at NOK - 16.0 million.
Total assets as of 31st of December 2020 were NOK 570.0 million, whereof NOK 511.8 million in current assets (NOK 506.1million in cash and deposits and NOK 5.7 million in total debtors) and NOK 58.1 million in non-current assets, whereof NOK 55.3 million in intangible assets, NOK 2.8 million in tangible fixed assets and NOK 0.1 million in financial fixed assets.
Total equity amounted to NOK 515.7 million and total liabilities of NOK 54.3 million, whereof NOK 44.0 million in short-term liabilities and NOK 10.7 million in long-term liabilities/provisions.
The equity ratio was 90%.
Net increase in cash during the financial year was NOK 496.1 million. Net cash flow from operating activities was NOK 28.5 million. Note that a positive impact of NOK26.7 million relates to that HydrogenPro entered into a share purchase agreement with the initial shareholders of Advanced Surface Plating ApS on 20th of December 2020. As the payment was first settled through a share capital increase approved by the extraordinary general meeting on January 8th 2021, the claims at year end, was treated as part of other short term liabilities.)
Net cash flow from investing activities of NOK – 51.7 million (incl. R&D of NOK 46.9 million which relates to the acquisition of Advanced Surface Plating ApS).
Net cash flows from financing activities of NOK 519.4 million, mainly due to the gross proceeds of NOK 550 million raised in connection with the IPO.
The Front End Engineering Contracts (FEED) were completed during 2020 and based on this work, H2V submitted, relevant applications to French authorities. From our client we understand that these applications are still pending. We also understand that the client continues to work with various funding schemes for renewable energy projects, both EU and France based. In February 2021 H2V and Air Liquide announced a transaction which implies that Air Liquide acquires a 40% ownership in the Normandy project. HydrogenPro is currently working on a comprehensive invitation to bid ("ITB") process for sub-suppliers to these projects.
This project is developing, and the Company is in a close dialogue with the project initiators. Activity has stepped up recently partly due to a «green» re-focus in the US following the inauguration of the Biden administration in January 2021. The initiators have entered into longterm offtake agreements for parts of the planned production. Also, long-term pricing of environmental credits related to synthetic fuel is progressing. A leading US investment bank has been engaged to arrange the financing of the project. Company understands that a contract for detailed engineering work with a large engineering company is expected to be finalized within shortly.
The Company completed the design work related to developing a large 11MW electrolyser for the US market in January 2021. Discussions are ongoing regarding a possible pilot plant to be built and delivered to Mitsubishi Power in the US.
HydrogenPro is listed on Euronext Growth at Oslo Stock Exchange under the ticker "HYPRO".
As of 31st of December 2020 the number of shares outstanding was 57,169,312 with a par value of NOK 0,001/share, and the number of shareholders was 1993, compared to 225 at the date of listing on 14th of October 2020.
The market capitalization as of year-end 2020 was NOK 3.48bn.
Given the Company's early stage of development and strategic ambitions, the Board of Directors does not recommend a dividend for the year 2020.
Through its' ordinary operating activities, the Company is exposed to various types of risk and this exposure to risk is expected to increase as the Company gradually becomes more involved in the actual delivery and system integration of large-scale electrolyser plants. The Company is proactively working to identify risks and taking risk mitigating initiatives to the extent this is practicable and appropriate. The ongoing work with an ISO certification of the Company is an important part of the Company's efforts to manage and control risk.
Below follows a discussion of the Company's main risks and uncertainties. Additional risks and uncertainties that the Company currently believes are of less importance or that are currently not known to the Company, may also have a material adverse effect on the Company's business, financial condition, results of operations and cash flow.
Demand for hydrogen and thus the interest in acquiring the Company's services, may be volatile and are affected by numerous factors beyond the Company's control. Some of these relate to the cost of producing and delivering hydrogen, expectations regarding future energy prices, governmental laws, regulations and permissions, local and international energy and climate policies and economic conditions, technological changes etc.
Furthermore, the Company depends on its' ability to ensure sufficient product quality and performance of the electrolyser systems to meet the customer's expectations and to remain competitive.
Violations of and/or changes in laws and regulations, including environmental laws could increase costs or change the way the Company does business. Similarly, changes in laws could make operating the Company's business more expensive or require the Company to change the way in which it conducts its business. The hydrogen industry is in its development phase and is not currently subject to industry specific government regulations in all regions.
Disruptions of deliveries by the Company's suppliers could increase operating costs, decrease revenues and adversely impact the Company's operations. The Company has still not entered into final written agreements with material subcontractors.
The Company may be subject to litigation that could have an adverse effect on the Company's business, results of operations, cash flows, financial condition and/or prospects. There are inherent risks related to the Company's business which may expose the Company to litigation, including personal injury litigation, environmental litigation, contractual litigation with clients or other contract counterparties, intellectual property litigation and tax or securities litigation. The Company is not involved in any litigation.
A further spread of the corona virus (COVID-19) or a similar pandemic could potentially have a material adverse effect on the Company.
The Company uses information technology systems to conduct its business, and disruption, failure or security breaches of these systems could materially and adversely affect its business and results of operations.
The Company's functional currency is NOK. The Company operates globally and is therefore exposed to currency fluctuations, mainly related to USD, Euro and CNY. The Company's exposure to interest rates was mainly related to interest earned on the Company's cash position with banks. The Company's exposure to currencies and interest rates is managed on a continuous basis.
The Company is exposed to credit risk. Any failure in the ability or willingness of a counterparty to fulfil its contractual obligations may have a significant adverse effect on the Company's business, prospects, financial results and/or results of operations.
The Company may require additional capital in the future to execute its strategy or for other purposes, which may not be available on favorable terms, or at all.
With our ambition to become a leading supplier of water electrolyser systems for industrial applications, the Company has a responsibility to commit to high standards relating to working environment and personnel welfare, environmental impact and business practices.
Our ambition is to be an honest, ethical and reliable corporation and build a global reputation as a trusted supplier and partner. We will achieve this by adopting and complying with principles of corporate responsibility and in our daily operations, demonstrate integrity and transparency.
Following the IPO the Company has implemented guidelines, policies and procedures relating to human rights, employee rights and social matters including prevention of corruption, harassment and discrimination.
HydrogenPro's reports on the company's corporate governance in accordance with the Norwegian Accounting Act § 3-3b. Please see Corporate Governance Report in next section.
The company had 10 direct employees at the end of the financial year, whereof three women and seven men. The company had no accidents or injuries of staff during 2020 and sick leave was 0.0%.
During 2020 a Director's and Officer's ("D&O") insurance agreement was not in place. As the Company is growing its business a D&O insurance was entered into effective from 19th of April 2021.
The core of Hydrogen Pro's business model is to provide green hydrogen solutions for industrial purposes, i.e. sustainability is the core of our offering through combating climate change. The company's hydrogen solutions have zero emissions when connected to renewable power sources as solar, wind or hydro power.
On 8th of January 2021: In connection with the acquisition of Advanced Surface Plating ApS in Denmark (ASP), the Extraordinary General Meeting resolved to carry out a share capital increase of 600,000 shares bringing the total number of outstanding shares to 57,769,312.
On 8th of January 2021: A Memorandum of Agreement was entered into between Repsol S.A. Ariema S.A and HydrogenPro with a plan to develop joint hydrogen projects. Within the framework of a Memorandum of Understanding, HydrogenPro will assist the Spanish multi-energy provider Repsol to mature and accelerate projects which will help Repsol achieve its' target of becoming a zero emissions company by 2050. HydrogenPro will contribute technology and know how to build and deliver efficient high pressure alkaline electrolysers to produce green hydrogen which will contribute to the decarbonization of Repsol and to reaching its' zero-emission target.
In late January, an application was submitted for European Green Deal funding. A key component of the project is to implement the latest electrolyser technology with improved efficiency to design an optimized 100MW plan. Any future project depends on allocation of Green Deal funding, and at present, there are no assurances that such funding will be granted nor that Repsol will make a final decision to invest in an electrolyser plant in the future.
Ariema will act as facilitator and assist and support HydrogenPro during the project phase and assuming the project is approved, will support and assist HydrogenPro in establishing a supply chain for electrolyser projects in Spain.
On 8th of February 2021: Air Liquide (as 40% owner of Normandy project) announced a Memorandum of Understanding ("MoU") with Siemens for PEM electrolyser co-operation. Normandy project mentioned as opportunity for Siemens PEM electrolyser. Dunkirk-project not impacted by this MoU. The submitted application to French authorities is based on HydrogenPro's engineering studies and technology for both projects.
On 22nd of February 2021: HydrogenPro held its first quarterly presentation (Q4 2020) with a target to produce green hydrogen at USD 1.2/kg through its world-leading electrode technology.
On 23rd of April 2021: HydrogenPro and Hynion entered into two collaboration agreements on green hydrogen supply to fueling stations:
HydrogenPro will supply green hydrogen to Hynion´s fueling station from two of its test and demo electrolyser containers and further testing of full-scale electrodes with the novel surface treatment technology, as part of a larger program to verify its technologies. Hynion will be the offtaker of hydrogen at commercial terms. The parties will, together with Industrial Green Tech, apply for Enova grants as part of a larger project in the Grenland area.
A general collaboration with Hynion. The parties will collaborate on defined projects that are suitable for cooperation where HydrogenPro will deliver large-scale hydrogen production plants that will serve as production hubs to Hynion's further distribution to its hydrogen stations across different geographies. Further potential to build a centralized system of hydrogen production for further distribution to its network of fueling stations. There is a clear mutual win situation to co-operate at Herøya and within the Industrial Green Tech cluster at Herøya Industripark and HydrogenPro's focus on large scale industrial applications remain unchanged.
On 28th of April 2021: HydrogenPro and Kvina Energy Park (KEP) entered into a co-operation agreement on the development of a significant hydrogen hub in the Kvinesdal municipality in Norway. The plot is close to the main grid for electricity, which is expected to provide ample access to electric power of 500-800 MW of annual hydrogen gas production in the order of 100,000 tons per year, equaling an estimated 190,000 tons of CO2 per year to replace gray hydrogen.
The plot is conveniently located in relation to transport by rail, road and over sea. Plot regulation for industrial purposes that opens up for hydrogen production and works in parallel with the license application for electricity. At the same time, the company will intensify its efforts to develop demand and new value chains for green hydrogen.
The parties will establish a jointly owned company, Kvina Hydrogen AS, which will be responsible for the industrial and commercial development of the project. The initiators behind KEP will take daily responsibility for this development, while HydrogenPro will assist with support and assistance in the design and optimization of production facilities for electrolysis as well as assistance and support in dialogues with industrial users and in the development of new value chains.
The Board of Directors sees significant opportunities for HydrogenPro in the green hydrogen industry. The Company is strategically positioned in a fast-growing market, has a unique technology position and has been chosen as the supplier on four large projects. The company has a large and growing pipeline of potential future projects and is developing a possible partnership position with several companies. The Company has a well-capitalized balance sheet.
The Board believes that with expected awards of subsidized EU funding late this year and next year, Europe will start seeing some of the larger projects move into the stage of actually ordering the electrolyser equipment.
Please note that the outlook is subject to the risks outlined in the non-exhaustive description of risk factors described above.
In accordance with section 3(3a) of the Norwegian Accounting Act, the Board of Directors, confirms that the going-concern assumption is met and that the annual accounts for the Company for 2020, to the best of our knowledge, have been prepared in accordance with applicable accounting standards, and that the information provided in the financial statements gives a true and fair view of the Company's assets and liabilities.
Chairman of the Board Board member
Terje Mikalsen Richard Espeseth Board member Board member
Walter Quam Ellen Merethe Hanetho (Electronically signed) (Electronically signed)
(Electronically signed) (Electronically signed)
Mårten Lunde CEO (Electronically signed)
Good corporate governance is important when building a larger and robust organization to create shareholder valuecredibility and access to capital in the financial markets and also build a reputation as a trusted and reliable supplier and partner to large international corporates. While HydrogenPro is not subject to the Norwegian recommendations in NUES (Norwegian Code of Practice for Corporate Governance) updated as of 17 October 2018, the Company aims to comply with and seek direction from the guidelines and procedures in NUES.
HydrogenPro was listed on 14th of October 2020 on Euronext Growth Oslo, under the ticker "HYPRO". As a listed company, HydrogenPro will comply with applicable provisions of the Norwegian Securities Trading Act, and Market Abuse Regulation (MAR), the Continuing obligations for companies listed on Euronext Growth, the Norwegian Private Limited Liability Companies Act and all other applicable laws and regulations.
During 2020, the Board of Directors conducted 18 board meetings, the meetings were conducted as physical meetings, online meetings and electronic circulation of documents.
The General Meeting is the highest decision-making authority of the Company. All shareholders of the Company are entitled to attend and vote at General Meetings and to table draft resolutions for items to be included on the agenda for a General Meeting. The General Meeting will normally be held each year by the end of June, with notice of the event and documents available on the Company website no later than seven days before the annual general meeting. Shareholders may participate and vote, in person or by proxy, as long as they are registered with the Norwegian Registry of Securities (VPS).
Pursuant to Article 5 of the Articles of Association, the Board of Directors shall consist of 2-6 members elected by the general meeting. The current Board of Directors consists of four members, one woman and three men. All members are elected for a term of two years and may be reelected. In accordance with Norwegian law, the Board of Directors is responsible for, among other things, supervising the general and day-to-day management of the Company's business. This includes ensuring proper organization, preparing plans and budgets for its activities ensuring that the Company's activities, accounts, and assets management are subject to adequate controls and undertaking investigations necessary to perform its duties.
In accordance with Norwegian law and instructions set out by the Board of Directors, Management is responsible for the day-to-day management of the Company's operations. Among other responsibilities, the Company's Chief Executive Officer (the "CEO"), is responsible for keeping the Company's accounts in accordance with existing Norwegian legislation and regulations and for managing the Company's assets in a responsible manner. In addition, the CEO must, according to Norwegian law, brief the Board of Directors about the Company's activities, financial position and operating results as a minimum once a month.
We regard the health and safety of all employees and others directly associated with our activities, as our outmost priority. This is an area of continuous focus for the Company and has been particularly highlighted during the Covid 19 pandemic which continues to affect us. In general, the Company complies with relevant local health and safety laws, regulations, and best practices to provide and maintain a healthy and safe working environment.
Leave of absence was measured to 0.0% in 2020 of the total working hours in the Company in 2020. Furthermore, we had no incidents or accidents reported neither of personnel injury or materials during the year. The COVID-19 pandemic was an important event throughout 2020 and HydrogenPro has focused on safeguarding employees by implementing infection control measures and following government advice and regulations. This has included working fromhome orders when and where possible. No employees in HydrogenPro have been confirmed with COVID-19 during 2020.
HydrogenPro seeks transparency and is committed to provide its shareholders with precise and relevant information to ensure that the Company's share price reflects its true value and prospects. HydrogenPro upholds the equal treatment of shareholders and potential investors. HydrogenPro has implemented a process for handling of sensitive information to ensure that the Company, its employees, and representatives fulfill their obligations regarding the handling and publication of sensitive information. HydrogenPro's financial calendar, press releases and stock exchange notices are published on Oslo Børs' platform Newsweb and is also made available on the Company's web site.
The Investor Relations activities are conducted by the IR team, which includes the CFO, the CEO, and the Chairman of the Board as well as other personnel appointed by the team. Only members of the IR team act as spokespersons.
HydrogenPro's auditor is BDO AS. The partners of BDO AS are members of The Norwegian Institute of Public Accountants (Nw.: "Den Norske Revisorforeningen"). The auditors provide a statement each year confirming their independence (see "Independent Auditor's Report"). At each year's annual general meeting, the Board of Directors discloses the fees paid to the auditors.
Chairman of the board
Walter has 40 years of experience from executive management and board positions in international corporations such as DNV GL, Gemini Consulting, CapGemini and Kongsberg Gruppen ASA based in Norway, East Asia, Continental Europe and the Nordics.
Walter has since stepping down as the President and CEO of Kongsberg Gruppen ASA mid 2016 devoted his time to non-executive board roles and strategic engagements through his own advisory business, miway.no. He is currently chairperson in Petroleum Geo-Services ASA, SINTEF, Council of the Foundation DNV, mnemonic, wheel.me and Digital Norway. Walter holds a MSc from NTNU/NTH in Trondheim. Qvam is a Norwegian citizen and resides in Norway.
Terje has a long list of top management and board positions. He co-founded Norsk Data AS and has been an active owner in many companies as well as heading the listings of Norsk Data, Hafslund, Nycomed and NCL at the NY stock exchanges (NYSE/Nasdaq). Terje holds an MSc from NTH. He is a Norwegian citizen and resides in Norway.
Ellen has 20 years of experience from investment banking and private equity as a finance and business development executive in corporations such as Frigaard Invest, Credo Partners, Goldman Sachs Investment Banking Division in London and New York, and the Brussels Stock Exchange and Citibank in Brussels. She is founder and chairperson of Cercis, a cleantech investment company established in 2020. Ellen holds a BSBA from Boston University, US and an MBA from Solvay University, Belgium in addition to executive training from INSEAD, France and Harvard Business School, US. Hanetho is a Norwegian citizen and resides in Norway.
Director
Richard founded HydrogenPro in 2013. He has 25 years international industry experience from Norsk Hydro, Statoil, ABB and RPR. More than 10 years of experience from the hydrogen electrolyser business. M.Sc. in Mechanical Engineering from South Dakota School of Mine & Technology.
CEO
Mårten has held several positions as CEO and CFO, primarily within shipping and offshore. Previous CFO of Bonheur and CEO in Fred.Olsen Production and the Troms Offshore Supply group. M.Sc. in Economics and Business Administration from the Norwegian School of Economics (NHH). Mårten was appointed CEO as of 28th August 2020.
Richard founded HydrogenPro in 2013. He has 25 years international industry experience from Norsk Hydro, Statoil, ABB and RPR. More than 10 years of experience from the hydrogen electrolyser business. M.Sc. in Mechanical Engineering from South Dakota School of Mine & Technology.
Martin was appointed as CFO in December 2020 and joined HydrogenPro on 1st of March 2021. Martin comes from the position as VP, Head of Treasury and IR in Hurtigruten. Prior to this, he worked with strategy and M&A in Yara International and Corporate Finance in Carnegie. Martin holds a master's degree from Norwegian School of Economics (NHH) with a major in financial economics.
Additionally, Sindre Utne has been appointed as COO. He starts in HydrogenPro on 3rd of May 2021. He comes from the role as General Manager at Wärtsilä where he is heading the global business of Power & Energy Management Systems. Sindre has broad experience from business operations, strategy development, risk management and cost control. Sindre has a M.Sc. Offshore Safety and Risk Management.
| Hydrogenpro AS | Hydrogenpro Group |
||||
|---|---|---|---|---|---|
| 2020 | 2019 | Note | 2020 | 2019 | |
| Operating income and operating expenses | |||||
| 26 557 242 25 156 401 Revenue | 1, 2 | 26 557 242 | 0 | ||
| 136 330 | 0 Other operating income | 136 330 | 0 | ||
| 26 693 572 25 156 401 Operating Income | 26 693 572 | $\overline{\mathbf{0}}$ | |||
| 6 322 540 10 987 667 |
15 452 041 Raw materials and consumables used 7 705 967 Payroll expenses |
2 9 |
6 322 540 10 987 667 |
0 0 |
|
| 357 147 | 48 898 Depreciation and amortisation expense | 3 | 357 147 | 0 | |
| 14 980 530 16 556 202 Other operating expenses | 9 | 14 986 780 | 0 | ||
| 32 647 884 | 39 763 108 Operating expenses | 32 654 134 | $\overline{\mathbf{0}}$ | ||
| -5 954 312 -14 606 707 Operating profit | -5 960 562 | 0 | |||
| Financial income and expenses | |||||
| 449 068 | 9 994 Other interest income | 449 068 | 0 | ||
| 1455934 | 1 095 604 Other financial income | 1455934 | 0 | ||
| 491 562 | 1862 438 Other Interest expenses | 491 562 | 0 | ||
| 3 693 540 | 1 256 215 Other financial expenses | 3 693 540 | 0 | ||
| $-2280100$ | -2 013 054 Net financial income and expenses | 10 | -2 280 100 | 0 | |
| -8 234 412 -16 619 762 Operating result before tax 7 726 572 -3 748 614 Tax on ordinary result |
8 | $-8240662$ 7 726 572 |
0 0 |
||
| -15 960 984 -12 871 148 Operating result after tax | -15 967 234 | $\overline{\mathbf{0}}$ | |||
| -15 960 984 -12 871 148 Annual net profit | -15 967 234 | 0 | |||
| -15 960 984 -12 871 148 Majority share | -15 967 234 | 0 | |||
| Brought forward | |||||
| 15 960 984 12 871 148 Loss brought forward | 15 967 234 | 0 | |||
| -15 960 984 -12 871 148 Total allocated | 6 | -15 967 234 | $\overline{\mathbf{0}}$ |
| Hydrogenpro AS | Hydrogenpro Group | ||||
|---|---|---|---|---|---|
| 2020 | 2019 | Note | 2020 | 2019 | |
| Assets | |||||
| Fixed assets | |||||
| Intangible fixed assets | |||||
| 0 | 0 Research and development | 3 | 46 852 005 | 0 | |
| Concessions, patents, licences, trademarks, and | |||||
| 8 456 384 | 5 893 451 similar rights | 3 | 8 456 384 | 0 | |
| 0 | 7 726 572 Deferred tax asset | 0 | 0 | ||
| 8 456 384 | 13 620 023 Total intangible assets | 55 308 389 | O | ||
| Tangible fixed assets | |||||
| 2 715 897 | 0 Machinery | 3 | 2 715 897 | 0 | |
| 40 596 | 66 471 Equipment and other movables | 3 | 40 596 | 0 | |
| 2 756 494 | 66 471 Total tangible fixed assets | 2 756 494 | O | ||
| Financial fixed assets | |||||
| 36 533 706 | 50 000 Investments in subsidiaries | 13 | 50 000 | 0 | |
| 6702 36 540 408 |
6 702 Investments in shares 56 702 Total financial fixed assets |
6702 | 0 0 |
||
| 56 702 | |||||
| 47 753 285 | 13 743 195 Total fixed assets | 58 121 584 | $\overline{\mathbf{0}}$ | ||
| Current assets | |||||
| Debtors | |||||
| 3 182 831 | 1 146 300 Accounts receivables | 2 | 3 182 831 | 0 | |
| 2 540 970 | 2 185 381 Other receivables | 2 540 970 | 0 | ||
| 5723801 | 3 331 681 Total debtors | 5723801 | $\overline{\mathbf{0}}$ | ||
| 506 110 924 | 9 992 399 Cash and bank deposits | 5 | 506 110 924 | 0 | |
| 511 834 725 | 13 324 080 Total current assets | 511 834 725 | O | ||
| 559 588 010 | 27 067 275 Total assets | 569 956 309 | $\bf{0}$ |
| Hydrogenpro AS | Hydrogenpro Group | ||||
|---|---|---|---|---|---|
| 2020 | 2019 | Note | 2020 | 2019 | |
| Equity and liabilities | |||||
| Restricted equity | |||||
| 57 169 | 31 406 Share capital | 6.7 | 57 169 | 0 | |
| 542 170 113 | 9 843 138 Share premium reserve | 542 170 113 | 0 | ||
| 9 0 98 1 30 | 1 459 998 Other paid-in equity | 9 0 9 8 1 3 0 | 0 | ||
| 551 325 412 11 334 542 Total restricted equity | 551 325 412 | O | |||
| Retained earnings | |||||
| -35 648 245 -26 870 981 Loss brought forward | -35 648 245 | 0 | |||
| -35 648 245 -26 870 981 Total retained earnings | -35 648 245 | $\overline{\mathbf{0}}$ | |||
| 515 677 167 -15 536 439 Total equity | 6 | 515 677 167 | 0 | ||
| Liabilities | |||||
| Provisions | |||||
| 0 | 0 Deffered tax | 8 | 10 307 441 | 0 | |
| Ō | 0 Total provisions | 10 307 441 | O | ||
| Other long-term liabilities | |||||
| 0 | 22 911 739 Convertible loans | 0 | 0 | ||
| 0 | 352 707 Other long term liabilities | 0 | 0 | ||
| 0 | 23 264 446 Total of other long term liabilities | 0 | $\overline{\mathbf{0}}$ | ||
| Current liabilities | |||||
| 7 176 788 | 3 193 425 Trade creditors | 7 183 663 | 0 | ||
| 1 101 563 | 796 027 Public duties payable | 1 101 563 | 0 | ||
| 35 632 492 | 15 349 816 Other short term liabilities | 14 | 35 686 475 | 0 | |
| 43 910 843 | 19 339 268 Total short term liabilities | 43 971 701 | O | ||
| 43 910 843 | 42 603 714 Total liabilities | 54 279 142 | 0 | ||
| 559 588 010 27 067 275 Total equity and liabilities | 569 956 309 | 0 |
| Walter Quam | Ellen Merethe Hanetho |
|---|---|
| Chairman of the Board | Board member |
| (Electronically signed) | (Electronically signed) |
| Terje Mikalsen | Richard Espeseth |
| Board member | Board member |
| (Electronically signed) | (Electronically signed) |
Mårten Lunde CEO (Electronically signed)
| HydrogenPro AS | HydrogenPro Group |
||||
|---|---|---|---|---|---|
| 2020 | 2019 | Note | 2020 | 2019 | |
| Cash flows from operating activities -8 234 412 -16 619 762 Profit before tax |
$-8240662$ | 0 | |||
| 0 | 0 Gain of operating assets | 0 | 0 | ||
| $\Omega$ | 0 Payable tax | 0 | 0 | ||
| 357 147 | 48 898 Depreciation expense | 3 | 357 147 | 0 | |
| 0 | 188 427 Impairment of fixed assets | 0 | 0 | ||
| 7 638 132 | 1 459 998 Option based compensation | 12 | 7638132 | 0 | |
| 0 | 0 Change in inventory | O | 0 | ||
| -2 036 531 | -1 139 638 Change in accounts receivable | $-2036531$ | 0 | ||
| 3983363 | 1 387 311 Change in accounts payable | 3 990 238 | 0 | ||
| 0 | 0 Write-down shares | 0 | 0 | ||
| 26 702 049 | 6 966 011 Change in other time-limited items | 14 | 26 762 282 | 0 | |
| 28 409 748 | -7 708 755 Net cash flows from operating activities | 28 470 606 | O | ||
| Cash flows from investing activities | |||||
| -2 332 876 | -53 739 Additions on tangible assets | 3 | -2 332 876 | 0 | |
| $-2562933$ | 0 Additions on intangible assets | 3 | -49 414 938 | 0 | |
| 0 | 0 Disposal of fixed assets | 0 | 0 | ||
| 0 | 0 Disposal of intangible assets | 0 | 0 | ||
| -36 483 706 | -50 000 Change in other investing activities | 0 | 0 | ||
| -41 379 515 | -103 739 Net cash flows from investing activities | -51 747 814 | O | ||
| $-23264446$ | -770 115 Change in long term debt | $-23264446$ | 0 | ||
| 0 | 0 Change in non payable deferred tax due to consolidation 8 | 10 307 441 | 0 | ||
| 0 | 0 Payment of installments and advances in financial leasing | 0 | 0 | ||
| 0 | 0 Group contribution paid | o | 0 | ||
| 0 | 0 Payment of dividend | n | 0 | ||
| 532 352 738 | 9 844 544 Increased equity | 6, 7 532 352 738 | 0 | ||
| 509 088 292 | 9 074 429 Net cash flows from financing activities | 519 395 733 | 0 | ||
| 496 118 525 | 1 261 935 Net increase in cash | 496 118 525 | 0 | ||
| 9992399 | 8 730 464 Cash balanse at January 1 | 9992399 | 0 | ||
| 506 110 924 | 9992 399 Cash balanse at December 31 | 5 | 506 110 924 | O |
The financial statements have been prepared in accordance with the Norwegian Accounting Act and generally accepted accounting principles in Norway.
The Group's consolidated financial statements comprise HydrogenPro AS and companies in which HydrogenPro AS has a controlling interest. A controlling interest is normally obtained when the Group owns more than 50% of the shares in the company and can exercise control over the company.
The consolidated financial statement has been prepared in accordance with the same accounting principles for both parent and subsidiary.
Material transactions and balances between the companies in the group have been eliminated.
The purchase method is applied when accounting for business combinations. Companies which have been bought or sold during the year are included in the consolidated financial statements from the date when control is achieved and until the date when control ceases. Differences between the cost price of the subsidiaries' shares and the book value of net assets in the same subsidiaries at the time of acquisition have been analyzed and attributed to the assets to which the differences relate. The part of the excess cost that cannot be attributed to acquired assets is classified as goodwill and amortized over its economic life.
Consolidation has been carried out from the time of takeover until the time of disposal.
The preparation of financial statements in compliance with the Accounting Act requires the use of estimates. The application of the company's accounting principles also require management to apply assessments. Areas which to a great extent contain such assessments, a high degree of complexity, or areas in which assumptions and estimates are significant for the financial statements, are described in the notes.
Income from sale of goods and services are recognised at fair value of the consideration, net after deduction of VAT, returns,
discounts and reductions. Sales are taken to income when the company has delivered its products to the customer and there are no unsatisfied commitments which may influence the customer's acceptance of the product. Delivery is not completed until the products have been sent to the agreed place, and risks relating to loss and obsolescence have been transferred to the customer. Historical data is applied to estimate and recognise provisions for quantity rebates and returns at the sales date. Provisions for expected guarantee work are recognised as expenses and provisions for liabilities. Services are recognised in proportion to the work performed.
Assets intended for long term ownership or use have been classified as fixed assets. Assets relating to the trading cycle have been classified as current assets. Other receivables are classified as current assets if they are to be repaid within one year after the transaction date. Similar criteria apply to liabilities. First year's instalment on long term liabilities and long term receivables are, however, not classified as short term liabilities and current assets.
The purchase cost of assets includes the cost price for the asset, adjusted for bonuses, discounts and other rebates received, and purchase costs (freight, customs fees, public fees which are nonrefundable and any other direct purchase costs). Purchases in foreign currencies are reflected in the balance sheet at the exchange rate at the transaction date. For fixed assets and intangible assets purchase cost also includes direct expenses to prepare the asset for use, such as expenses for testing of the asset.
R&D expenses are taken into the balance sheet providing a future financial benefit relating to the development of an identifiable intangible asset can be identified and the expenses can be reliably measured. Otherwise such expenses are expensed as and when incurred. R&D expenses are depreciated on a straight-line basis over the asset's expected useful life.
Work in progress on long term fixed-price contracts is valued according to the percentage of completion method. The degree of completion is calculated as expenses incurred as a percentage of estimated total expense. Total expenses are reviewed on a regular basis. If projects are expected to result in losses, the total estimated loss is recognised immediately.
Trade debtors are recognised in the balance sheet after provision for bad debts. The bad debts provision is made on basis of an individual assessment of each debtor and an additional provision is made for other debtors to cover expected losses. Significant financial problems at the customers, the likelihood that the customer will become bankrupt or experience financial restructuring and postponements and insufficient payments, are considered indicators that the debtors should be written down.
Short term investments in listed companies the fair value principle is used. The value in the balance sheet corresponds to the market value of the investments at the period end. Dividends received, and both realised and unrealised gains/losses are recognised as other financial income.
Assets and liabilities in foreign currencies are valued at the exchange rate on the balance sheet date. Exchange gains and losses relating to sales and purchases in foreign currencies are recognised as operating income and cost of goods sold.
Liabilities, with the exception of certain liability provisions, are recognised in the balance sheet at nominal amount.
The tax charge in the income statement includes both payable taxes for the period and changes in deferred tax. Deferred tax is calculated at relevant tax rates on the basis of the temporary differences which exist between accounting and tax values, and any carryforward losses for tax purposes at the year-end. Tax enhancing or tax reducing temporary differences, which are reversed or may be reversed in the same period, have been eliminated. The disclosure of deferred tax benefits on net tax reducing differences which have not been eliminated, and carryforward losses, is based on estimated future earnings. Deferred tax and tax benefits which may be shown in the balance sheet are presented net.
Tax reduction on group contributions given and tax on group contribution received, booked as a reduction of cost price or taken directly to equity, are booked directly against tax in the balance sheet (offset against payable taxes if the group contribution has affected payable taxes, and offset against deferred taxes if the group contribution has affected deferred taxes).
Deferred tax is reflected at nominal value.
The cash flow statement has been prepared according to the indirect method. Cash and cash equivalents include cash, bank deposits, and other short-term investments which immediately and with minimal exchange risk can be converted into known cash amounts, with due date less than three months from purchase date.
| Note 1 | Revenue | ||
|---|---|---|---|
| Group geographical distribution | 2020 | 2019 | |
| Norway | 136 330 | 947 050 | |
| Europe | 8412867 | 24 209 351 | |
| America | 18 144 375 | ٠ | |
| Total | 26 693 572 | 25 156 401 |
| IVOLE 4 LUIR ICHII CUIRIGULS |
||
|---|---|---|
| Group balance sheet value of projects | 2020 | 2019 |
| Included in trade debtors | ||
| Accrued income, not invoiced | ٠ | 1 3 5 4 6 8 3 |
| Retained payments according to contract | ٠ | |
| Included in short term debt | ||
| Deferred income, invoiced amount in excess of earned | 786 700 | 6408752 |
| Result items relating to long term contracts | 2020 | 2019 |
| Result of work in progress | ||
| Total income in the income statement | 9 132 9 64 | 20 926 373 |
| Estimated contract profit | 5986573 | 6916517 |
| Fixed assets Note 3 |
|||||
|---|---|---|---|---|---|
| Group fixed assets | Container | Movables | Licences | R&D | Total fixed assets |
| Purchase cost 01.01. | 0 | 100 369 | 0 | 0 | 100 369 |
| Additions | 3 017 597 | 29 572 | 8456384 | 46 852 005 | 58 355 558 |
| Impairment | 0 | 0 | 0 | 0 | 0 |
| Purchase cost 31.12. | 3 017 597 | 129 941 | 8456384 | 46 852 005 | 58 455 927 |
| Accumulated depreciation 31.12 | 301 700 | 89 345 | 0 | 0 | 391 045 |
| Net book value 31.12. | 2715897 | 40 596 | 8 456 384 | 46 852 005 | 58 064 882 |
| Depreciation in the period | 340 547 | 16 600 | 357 147 | ||
| Expected useful life | 5 years | 5 years | |||
| Depreciation plan | Straight line Straight line |
As per 31.12.2020 the company had capitalized NOK 8,5 million relating to the FEED (front end and engineering study) to be used in the further development of 100MW production plants. No capitalization was made during the 4th quarter. Financial lifetime is expected to be 5-10 years and the depreciation starts when the FEED study is finished and the 100MW hydrogen production plants begin to develop.
The R&D corresponds to the acquisition of the subsidiary Advanced Surface Plating ApS. The financial lifetime is expected to be 10 years. The acquistion date was 22. of desember 2020, and the depreciaton is considered to be effective from Q1 2021.
| Parent company fixed assets | Container | Movables | Licences | Total fixed assets | |
|---|---|---|---|---|---|
| Purchase cost 01.01. | 0 | 100 369 | 5 893 451 | 5993820 | |
| Additions | 3 017 597 | 29 572 | 2 5 6 2 9 3 3 | 5 610 102 | |
| Impairment | 0 | 0 | 0 | ||
| Disposals | 0 | 0 | 0 | 0 | |
| Purchase cost 31.12. | 3 017 597 | 129 941 | 8 45 6 38 4 | 11 603 922 | |
| Accumulated depreciation 31.12. | 301 700 | 89 345 | $\Omega$ | 391 045 | |
| Net book value 31.12. | 2 715 897 | 40 596 | 8 456 384 | 11 212 877 | |
| Depreciation in the period | 340 547 | 16 600 | ٠ | 357 147 | |
| Expected useful life | 5 years | 5 years | |||
| Depreciation plan | Straight line | Straight line |
| Hydrogenpro AS Other long term liabilities |
Hydrogenpro Group Other long term liabilities |
||
|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 |
| 0 | 0 Group companies | 0 | 0 |
| 0 | 109 629 Associated companies | 0 | 0 |
| 0 | 352 707 Owners | ||
| Ω | 462 336 Total | ||
| 0 | 352 707 Long term liabilities (more than five years maturity) | 0 | 0 |
| 50 674 | 0 Short term with associated companies | 50 674 |
| Hydrogenpro AS | Hydrogenpro Group | ||||
|---|---|---|---|---|---|
| 2020 | 2019 | Restricted bank deposits | 2020 | 2019 | |
| 372 217 | 327 478 Withheld employee taxes | 372 217 |
| Share | Share | ||||
|---|---|---|---|---|---|
| Equity changes in the year | capital | premium | Other paid-in equity | Other equity | Total |
| Equity 01.01. | 31 40 6 | 9843138 | 1459998 | -26 870 981 | -15 536 439 |
| Profit for the year | -15 960 984 | -15 960 984 | |||
| Correction* | 7 183 720 | 7 183 720 | |||
| Captial increase | 25 763 | 532 326 975 | 7638132 | 539 990 870 | |
| Equity 31.12. | 57 169 | 542 170 113 | 9098130 | -35 648 245 | 515 677 167 |
| Equity changes in the year | Share capital |
Share premium |
Other paid-in equity | Other equity | Total |
|---|---|---|---|---|---|
| Equity 01.01. | 31 40 6 | 9843138 | 1459998 | -26 870 981 | $-15536439$ |
| Profit for the year | -15 967 234 | -15 967 234 | |||
| Correction* | 7 183 720 | 7 183 720 | |||
| Other changes** | 6 2 5 0 | 6 2 5 0 | |||
| Captial increase | 25 763 | 532 326 975 | 7638132 | 539 990 870 | |
| Equity 31.12. | 57 169 | 542 170 113 | 9098130 | -35 648 245 | 515 677 167 |
*Correction of error from previous year due too: The provision for losses has not been adjusted downwards as costs have been booked. This item has therefore accumulated incorrectly, but are now corrected.
** Loss carried forward for the year of subsidiary is excluded from consolidation. Lack of consolidation does not affect the assessment of the group's position and result.
| Number of | |||
|---|---|---|---|
| List of (20) major shareholders at 31.12. | shares | Ownership | |
| Richard Espeseth | Board member | 11 366 481 | 19,9% |
| TM Holding AS | Board member | 9585182 | 16.8% |
| Mitsubishi heavy Industries Ltd | 5 381 165 | 9,4% | |
| Vivian Espeseth | 3 173 571 | 5.6% | |
| Verdipapirfondet Norge Selektiv | 1733794 | 3.0% | |
| Folketrygdfondet | 1665000 | 2,9% | |
| Eneren Invest AS | partly owned by CEO | 1506966 | 2,6% |
| Barclays Capital Securities LTD. | 1500 000 | 2.6% | |
| Verdipapirfondet DNB SMB | 1415059 | 2,5% | |
| Clearstream Banking S.A. | 1392789 | 2,4 % | |
| Tor Danielsen | 1 3 7 3 5 7 1 | 2,4% | |
| Jan Fredrik Garvik | 1 3 3 7 4 1 1 | 2,3% | |
| Erste Group Bank AG | 1 250 000 | 2,2% | |
| Klaveness Marine Finance AS | 1 200 801 | 2,1% | |
| State Street Bank and Trust Comp | 960 500 | 1,7% | |
| DZ Private Bank S.A. | 641759 | 1,1% | |
| Verdipapirfondet Pareto Investment | 638 000 | 1,1% | |
| JP Morgan Chase Bank, N.A., London | 600 000 | 1,0% | |
| SEB Prime Solutions Sissener Canop | 600 000 | 1,0% | |
| Verdipapirfondet DNB Miljøinvest | 564 797 | 1,0% | |
| Sum largest shareholders | 47 886 846 | 83,8% | |
| Sum other shareholders | 9 2 8 2 4 6 6 | 16,2% | |
| Total number of shares | 57 169 312 | 100 % |
| Note 8 | Taxes | |||
|---|---|---|---|---|
| Hydrogenpro AS | Hydrogenpro Group | |||
| 2020 | 2019 | This year's tax expense | 2020 | 2019 |
| Entered tax on ordinary profit/loss: | ||||
| 0 | 0 Payable tax | $\Omega$ | 0 | |
| 7726572 | -3 748 614 Changes in deferred tax advantage | 7726572 | 0 | |
| 7726572 | -3 748 614 Tax expense on ordinary profit/loss | 7726572 | $\Omega$ | |
| Taxable income: | ||||
| -8 234 412 -16 619 762 Ordinary result before tax | $-8234412$ | 0 | ||
| -25 332 291 | -419 393 Permanent differences | -25 332 291 | 0 | |
| $-11346283$ | 6 387 712 Changes in temporary differences | $-11346283$ | 0 | |
| 0 | 0 Use of loss carried forward | 0 | 0 | |
| -44 912 985 -10 651 443 Taxable income | -44 912 985 | 0 | ||
| Payable tax in the balance: | ||||
| 0 | -441 308 Payable tax on this year's result | 0 | 0 | |
| 0 | -441 308 Total payable tax in the balance | 0 | 0 | |
| Calculation of effective tax rate: | ||||
| -8 234 412 -16 619 762 Profit before tax | $-8234412$ | O | ||
| 7726572 | -3 748 614 Calculated tax on profit before tax | 7726572 | 0 | |
| $-5573104$ | -92 266 Tax effect of permant differences | $-5573104$ | 0 | |
| 0 | 0 Effect of change in tax rate | o | 0 | |
| 0 | 0 Change in accounting principles regarding deferred tax | o | 0 | |
| o | 0 Deferred tax asset, not posted in the balance sheet | o | 0 | |
| 2 153 468 | -3 840 880 Total | 2 153 468 | 0 | |
| Effortiva tay rata |
| Hydrogenpro AS | Hydrogenpro Group | |||
|---|---|---|---|---|
| 2020 | 2019 | 2020 | 2019 | |
| 619041 | 73 119 Tangible assets | 619041 | 0 | |
| 0 | -1427 535 Receivables and borrowings in foreign currency | o | 0 | |
| 5743672 | 5 107 767 Production contracts | 5743672 | 0 | |
| -262 000 | -8 998 921 Allocations and more | $-262000$ | 0 | |
| 0 | 0 Differences due to consolidation | 46 852 005 | 0 | |
| 6 100 713 | -5 245 570 Total | 52 952 718 | 0 | |
| -74 788 198 -29 875 213 Accumulated loss to be brought forward | -74 788 198 | 0 | ||
| 68 687 486 | 0 Not included in the deferred tax calculation | 68 687 486 | 0 | |
| 0 -35 120 784 Basis for calculation of deferred tax | 46 852 005 | 0 | ||
| O | 7 726 572 Deferred tax asset (22% / 22%) | O | 0 | |
| 0 | 0 Deferred tax (22% / 22%) Effect of change in tax rate |
10 307 441 | 0 | |
| Hydrogenpro AS | Hydrogenpro Group | |||
|---|---|---|---|---|
| 2020 | 2019 | Payroll expenses | 2020 | 2019 |
| 9051331 | 5931858 Salaries/wages | 9 0 5 1 3 3 1 | 0 | |
| 1 339 843 | 1 194 374 Social security fees | 1 3 3 9 8 4 3 | 0 | |
| 556 715 | 506 633 Pension expenses | 556 715 | 0 | |
| 39 780 | 73 102 Other remuneration | 39 780 | 0 | |
| 10 987 668 | 7 705 967 Total | 10 987 668 | 0 |
The number of employees in the accounting period has been 10.
| Hydrogenpro AS | Hydrogenpro Group | |||
|---|---|---|---|---|
| CEO* | Board | Remuneration to executives | CEO* | Board |
| 2820000 | 171 150 Salaries/board fee | 2820000 | 171 150 | |
| 70 000 | 0 Pension expenses | 70 000 | 0 | |
| 156 130 | 0 Other benefits | 156 130 | 0 | |
| 3 046 130 | 171 150 Total | 3 046 130 | 171 150 |
*The figures combine both CEOs for 2020. The current CEO came in at the end of August 2020.
The CEO has a bonus agreement which is based on achievement of certain predefined KPIs entitles to a bonus of up to 50% of salary compensation. This is included in salaries.
No loans/sureties have been granted to the CEO, Board chairman or other related parties.
Mandatory Occupational Pensions
The company is obliged to have a service pension scheme pursuant to the Act on Mandatory Occupational Pensions.
The company's pension schemes satisfy the requirements of this Act.
| Hydrogenpro AS | Hydrogenpro Group | |||
|---|---|---|---|---|
| 2020 | 2019 | Expensed audit fee | 2020 | 2019 |
| 303 613 | 113 476 Statutory audit | 303 613 | 0 | |
| 216 438 | 264 990 Other assistance | 216 438 | 0 | |
| 520 051 | 378 466 Total audit fees | 520051 | 0 | |
| Staturoty audit includes technical assistance with financial statements |
Auditors fee are exclusive VAT
Note 9
| Note 10 | Finance income and expenses | |||
|---|---|---|---|---|
| Hydrogenpro AS | Hydrogenpro Group | |||
| 2020 | 2019 | Finance income | 2020 | 2019 |
| 449 068 | 9 994 Other interest income | 449 068 | 0 | |
| 6 1 9 2 | 6.056 Other financial income | 6 1 9 2 | 0 | |
| 1449742 | 1089 548 Foreign exchange gains (agio) | 1449742 | ||
| 1905 002 | 1 105 598 Total finance income | 1905 002 | 0 | |
| Hydrogenpro AS | Hydrogenpro Group | |||
| 2020 | 2019 | Finance expenses | 2020 | 2019 |
| 491 562 | 1862 438 Other interest expenses | 491 562 | 0 | |
| 242 708 | 0 Other financial expenses | 242 708 | 0 | |
| 3 450 832 | 1256215 Foreign exchange losses (disagio) | 3 450 832 | 0 | |
| 4 185 102 | 3 118 653 Total finance expenses | 4 185 102 | 0 |
The fair value of the options granted in the period has been calculated by using the Black-Scholes option pricing model and a deemed option price where relevant. The fair value has been calculated to NOK 10 676 838 per 31.12.
The basis for the valuation model consists of several factors which affects the calculated fair value of granted options. The assumptions used in the calculation are:
| Price at grant date | 7 |
|---|---|
| Exercise price | 7 |
| Option life | 4 years |
| Risk-free interest rate | 1.17 % |
| Volatility | 58 % |
During the period, member of the board, employees and others have been granted 2.249.000 new stock options. Total options awarded per 31.12.2020 is 3.740.000. Below is an overview of the Group Management and Board Members' share options:
| Opening | Granted | Exercised | |||
|---|---|---|---|---|---|
| balance | options | Forfeited options | options | Ending balance | |
| Walter Hafslo Qvam, Chair of | |||||
| the Board | 314 000 | 314 000 | |||
| TM Holding AS, Board member | 163 005 | 163 005 | |||
| Ellen Merete Hanetho, Board | |||||
| member | 216 000 | 216 000 | |||
| Other employees | 275 000 | 275 000 | |||
| Other | 936 995 | 1 935 000 | 100 000 | 2 771 995 | |
| 1 591 000 | 2 249 000 | 100 000 | - | 3 740 000 |
(A) - average exercise price for options exercised during the year
Granted options are generally vested or earned during a period of three years according to a predetermined schedule. Options vested or earned can be exercised at any time and must be exercised latest four years after award. The vesting requires continued employment or association with the company.
| Book value | |||
|---|---|---|---|
| Company | Location | Stake | 31.12.2020 |
| Advanced Surface Plating ApS | Aarhus (Denmark) | 100 % | 36 483 706 |
| HydrogenPro France SAS* | Lille (France) | 100 % | 50 000 |
| Total | 36 533 706 |
RDO AS Leirvollen 21A, 3736 Skien Løkkebakken 24, 3770 Kragerø
To the General Meeting in HydrogenPro AS
We have audited the financial statements of HydrogenPro AS.
We conducted our audit in accordance with laws, regulations, and auditing standards and practices generally accepted in Norway, including International Standards on Auditing (ISAs). Our responsibilities under those standards are further described in the Auditor's Responsibilities for the Audit of the Financial Statements section of our report. We are independent of the Company and the Group as required by laws and regulations, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.
Independent Auditor's Report HydrogenPro AS - 2020
$\overline{1}$
NSX2U-XUFQU-UEO75-7L8Z7-5QMOE-DUEI D
Dokumentnøkler!
Management is responsible for the other information. The other information comprises the Board of Directors' report and other information in the Annual Report, but does not include the financial statements and our auditor's report thereon.
Our opinion on the financial statements does not cover the other information and we do not express any form of assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated.
If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.
The Board of Directors and the Managing Director (management) are responsible for the preparation and fair presentation of the financial statements in accordance with the Norwegian Accounting Act and accounting standards and practices generally accepted in Norway, and for such internal control as management determines is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.
In preparing the financial statements, management is responsible for assessing the Company's and the Group's ability to continue as a going concern, disclosing, as applicable, matters related to going concern. The financial statements use the going concern basis of accounting insofar as it is not likely that the enterprise will cease operations.
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor's report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
For further description of Auditor's Responsibilities for the Audit of the Financial Statements reference is made to: https://revisorforeningen.no/revisjonsberetninger
Based on our audit of the financial statements as described above, it is our opinion that the information presented in the Board of Directors' report concerning the financial statements and the going concern assumption is consistent with the financial statements and complies with the law and regulations.
Based on our audit of the financial statements as described above, and control procedures we have considered necessary in accordance with the International Standard on Assurance Engagements (ISAE) 3000, «Assurance Engagements Other than Audits or Reviews of Historical Financial Information», it is our opinion that management has fulfilled its duty to produce a proper and clearly set out registration and documentation of the Company's and the Group's accounting information in accordance with the law and bookkeeping standards and practices generally accepted in Norway.
BDO AS
Espen Åsulfsen State Authorised Public Accountant (This document is signed electronically)
Independent Auditor's Report HydrogenPro AS - 2020
BDO AS, et norsk aksjeselskap, er deltaker i BDO International Limited, et engelsk selskap med begrenset ansvar, og er en del av det internasjonale nettverket BDO,
som består av uavhengige selskaper i de enkelte land. Fore
3
Signaturene i dette dokumentet er juridisk bindende. Dokument signert med "Penneo" - sikker digital signatur". De signerende parter sin identitet er registrert, og er listet nedenfor.
"Med min signatur bekrefter jeg alle datoer og innholdet i dette dokument."
Dokumentet er signert digitalt, med Penneo.com. Alle digitale signatur-data i dokumentet er sikret og validert av den datamaskin-utregnede hash-verdien av det opprinnelige dokument. Dokumentet er låst og tids-stemplet med et sertifikat fra en betrodd tredjepart. All kryptografisk bevis er integrert i denne PDF, for fremtidig validering (hvis nødvendig).
Hvordan bekrefter at dette dokumentet er orginalen?
Dokumentet er beskyttet av ett Adobe CDS sertifikat. Når du åpner dokumentet i
Adobe Reader, skal du kunne se at dokumentet er sertifisert av Penneo esignature service penneo@penneo.com. Dette garanterer at innholdet i dokumentet ikke har blitt endret.
Det er lett å kontrollere de kryptografiske beviser som er lokalisert inne i dokumentet, med Penneo validator - https://penneo.com/validate
HydrogenPro AS Hydrovegen 6 3933 Porsgrunn Norway www.hydrogen-pro.com
Building tools?
Free accounts include 100 API calls/year for testing.
Have a question? We'll get back to you promptly.