Nel ASA

Earnings Release • Feb 16, 2018

Nel ASA: Fourth Quarter 2017 Results

Nel ASA: Fourth Quarter 2017 Results

(Oslo, 16 February 2018) Nel ASA ("Nel") reported revenues in the fourth quarter

of 2017 of NOK 111.9 million, up from NOK 50.6 million in the fourth quarter of

2016. The company entered into an exclusive partnership with Nikola Motor

Company ("Nikola") during the quarter and is evaluating a possible 10x capacity

expansion to accommodate mega-scale orders and to maintain a leading cost

position.

"Looking back at 2017, I am pleased to see that the ambitions we set out to

significantly accelerate the market activities have succeeded. We ended the year

with an all-time high order backlog of NOK 465 million and have entered into

exciting partnerships with companies such as H2V Product and Nikola Motor. We

expect to continue our market development efforts in 2018, while moving into a

mode of execution. This includes preparing for significant capacity expansions

to accommodate large orders and to continue to build the organization," says Jon

André Løkke, Chief Executive Officer of Nel.

In the fourth quarter of 2017, Nel reported revenues of NOK 111.9 million,

compared to NOK 50.6 million in the same quarter of 2016, representing a revenue

growth of 120 percent. The underlying organic revenue growth for the full year

was around 40 percent, excluding Proton Onsite. The high activity level within

business development, investments and preparations for production ramp-up

continued as planned. Also in the fourth quarter, the EBITDA was negatively

affected by certain costs and ended at NOK -11.1 million, when adjusting for

ramp-up costs and non-recurring items of NOK 10.9 million, in addition to non

-cash share option costs of NOK 5.7 million. Following new US tax rules, the

reported net profit ended at a positive NOK 22.7 million for the quarter.

The net cash balance at the end of the fourth quarter increased from NOK 85.6

million to NOK 295.0 million, as a result of positive net cash flow from

operations of NOK 2.7 million and the private placement, including a subsequent

offering, of 98,000,000 new shares at a price of NOK 2.50 per share.

During the fourth quarter, Nel entered into exclusive partnership agreement with

Nikola for development of mega-scale hydrogen fueling stations for the potential

construction of the world's largest hydrogen network, consisting of 14 large

-scale sites with a capacity up to 32 tons of hydrogen per day. The initial part

of the partnership includes building two demo-stations for hydrogen fueling,

which will serve the Nikola prototype fleet. The initial purchase order has a

value of USD 3.6 million and delivery of the demo stations is intended to start

in the second half of 2018.

"We were very pleased to announce the partnership with Nikola. This joint

endeavor will leverage Nel's highly scalable electrolyzers and targets to reduce

the cost of renewable hydrogen to achieve price parity with fossil fuels. The

network will be jointly developed and scaled into the world's most efficient

hydrogen production and fueling sites," says Løkke.

Nel's order backlog further increased to approximately NOK 465 million in the

quarter. Following the Nikola partnership, in addition to the previously

announced framework agreement with H2V Product, a subsidiary of Alain Samson

owned SAMFI-INVEST Group, Nel is currently evaluating a 10x expansion of the

production capacity at Notodden, Norway from 25MW to 250MW.

"We are evaluating a capacity expansion that will reduce our costs by more than

30% by developing a fully automated, large-scale production line at Notodden.

Driving down cost will not only allow us to maintain a leading cost position,

but also enable us to offer renewable hydrogen projects that are fully

competitive with fossil alternatives," says Jon André Løkke, and adds that the

initial capacity increase and debottlenecking from 25MW to 40 MW is about to be

completed at minimal cost.

Nel will host a presentation at 08:00 CET at Hotel Continental in Oslo on

February 16, 2018. A live webcast of the call will also be available on the

company's website, www.nelhydrogen.com/webcast, and on

http://webtv.hegnar.no/presentation.php?webcastId=77872733

The fourth quarter 2017 report and presentation will be made available through

www.newsweb.no (Ticker: NEL) and www.nelhydrogen.com

ENDS

For further information, please contact:

Jon André Løkke, CEO, Nel ASA, +47 907 44 949

Bent Skisaker, CFO, Nel ASA, +47 468 21 693

About Nel ASA | www.nelhydrogen.com

Nel is a global, dedicated hydrogen company, delivering optimal solutions to

produce, store and distribute hydrogen from renewable energy. We serve

industries, energy and gas companies with leading hydrogen technology. Since its

foundation in 1927, Nel has a proud history of development and continual

improvement of hydrogen plants. Our hydrogen solutions cover the entire value

chain from hydrogen production technologies to manufacturing of hydrogen fueling

stations, providing all fuel cell electric vehicles with the same fast fueling

and long range as conventional vehicles today.