HydrogenPro published the Company’s interim report for the first quarter of 2025 on May 15, 2025.

Below are some highlights of the report:

• Revenues amounted to NOK 22m (NOK 70m Q4 24 and NOK 4m in Q1 24) – primarily related to deliveries for the SALCOS project (110 MW) with Andritz in Germany
• Gross profit amounted to NOK 7m, representing a 32% gross margin (41% Q4 24) but was impacted by NOK 8.2m in ACES project costs, compared to NOK 17.1m in Q4 2024. When adjusted for these ACES-related expenses, the gross margins for Q1 2025 and Q4 2024 reached 69% and 66%, respectively.
• OPEX of NOK 57m, a decrease of NOK 16m compared to Q4 24, reflecting the cost reduction measures taking effect.
• EBITDA of NOK -50m (NOK -44m Q4 24 and NOK -56m in Q1 2024), corresponding to a margin of -127% (-62% Q4 24).
• Cash balance of NOK 165m compared to NOK 191m at end of Q4 2024 with a capital injection of NOK 68m included from the strategic capital raise of NOK 70m secured from key partners Mitsubishi and Andritz – an additional NOK 70m is expected to be raised from Longi in Q2, although pending approval regarding Chinese regulations on foreign investments.
• HydrogenPro received one confirmed purchase order of USD 2.5m (NOK 26m).
• Backlog amounts to NOK 318m (NOK 305m in Q4 2024).

Successful Delivery and Project Execution

During the first quarter, Hydrogenpro continued delivering to the Green Steel SALCOS project with partner Andritz, demonstrating strong project execution regarding components being delivered on time and meeting complex requirements associated with a large-scale green hydrogen project. Most of the electrolyzer components for the Andritz order have now been delivered, with the remaining parts primarily constituting of the 3^rd generation electrodes.

The strong project execution is particularly important, considering the future potential this partnership presents, as highlighted by a new 100 MW order from Andritz expected to be confirmed in 2025. Andritz announced the receipt of an order for the authority engineering of a 100 MW green hydrogen plant in Rostock, Germany. Subject to the investment decision of the final customer, ANDRITZ expects to receive the notice to proceed with the supply of the plant. Upon receipt of the notice to proceed, ANDRITZ will supply the green hydrogen plant on an EPC (Engineering, Procurement, Construction) basis using HydrogenPro pressurized alkaline technology for the electrolysis process.

Strong Results from the Testing of Next Generation Electrodes

During Q1, a joint full-scale validation program was conducted together with Andritz in HydrogenPro’s test facility in Herøya. The program consisted of 500 testing hours where 50% of electrolyzers was equipped with 2^nd generation electrodes, while 50% was equipped with 3^rd generation electrodes for a direct comparison. The test confirmed the expected breakthrough in the technology where electrode performance improved efficiency with >12-14%. The efficiency parameter is one of the most important bases for evaluation from customers, as it reduces the operational costs for plant operators. The strong performance from the validation program therefore secures a continued highly competitive offering, positioning the Company to be considered for all large-scale projects moving forward.

Also, the partnership with the global leader Andritz, which assembles HydrogenPro’s components and cooperated in the validation program, confirms HydrogenPro’s strategic position regarding maintaining a slim organization while utilizing partners’ core competencies to sustain logistical flexibility and validate improvements in electrolyzer performance.

Confirmed Order

HydrogenPro received one confirmed order amounting to USD 2.5m. Although this represents a small order in comparison with the large-scale projects having been delivered on earlier, the confirmed order highlights an initial success in also targeting small-scale projects beyond the larger ones. A flexible strategy with exposure towards large-scale projects while also addressing small-scale projects through the partnership with J.H.K. is particularly relevant when navigating through a challenging market environment as small-scale projects often are characterized by shorter delivery times, potentially reducing revenue volatility over time. Analyst Group expects more orders of this nature to be secured throughout 2025.

Strong Financial Position

The cash position stands at NOK 165m, compared with NOK 191m in Q4 2024. The decrease is explained by a negative EBITDA of NOK -50m, changes in working capital of NOK -23m and CAPEX of NOK -22m, while the equity raise of NOK 70m from Andritz and Mitsubishi resulted in a net capital injection of NOK 68m to the Company. An additional NOK 70m is expected in Q2 from the capital raise from Longi, awaiting governmental approvement. While securing financing for strategic investments, the capital raises also strengthens the partnerships further, ensuring a shared interest in securing orders moving forward. The latest partnership with Longi also opens the Chinese market for HydrogenPro, which currently constitutes of 2/3 of the global electrolyzer demand.

Due to a challenging market, the Company is implementing cost reduction measures, where HydrogenPro is downsizing in Europe while also reducing the use of external consultants. Furthermore, activity in China is being reduced both in the Tianjin manufacturing plant and the Shanghai office. The cost reduction initiative is expected to save the Company NOK 40m on an annual basis. These measures are expected to be temporary in nature and are a response to the current market environment. The Company remains flexible in scaling up activity quickly when the market improves.

Challenging Market Environment but Signs of a Turning

The first quarter included a market backdrop with several cancellations of previously announced projects, ranging from 50 MW to 200 MW, confirming the challenging market environment observed since 2023. The primary reasons for this market backdrop can be summarized in rising costs, insufficient funding and infrastructure constraints, as well as reconsidered priorities in the U.S. with regards to green investments.

However, regions such as EU, Middle East, China and India still present strong opportunities with support through directed subsidies, exemplified by the European Hydrogen Bank, which has approximately EUR 2.2b earmarked for investments in the coming years.  These regions have a long-term vision of increased usage of green hydrogen, and as HydrogenPro already has presence in Europe and the U.S., as well as exposure towards China through the partnership with Longi, the Company is now looking to increase its focus on India and Middle East with new partnerships expected to be communicated in 2025.

Despite several project cancellations, the Company updated the prioritized sales pipeline, which now amounts to 13.3 GW or USD 4,4b in potential, demonstrating an expanded addressable market in new regions through the partnership with Longi and also the ability to target more types of projects through the partnership with J.H.K.

Strategic Investments

While taking cost reduction measures, targeting operational expenses, HydrogenPro continues to make strategic long-term investments, highlighted by continued investments in the third generations electrodes, strengthening the position for when the hydrogen market returns to a climate with more positive Final Investment Decisions.

HydrogenPro is taking strategic initiatives in upgrading the annual manufacturing capacity for the 3^rd generation electrodes to 350 MW, securing delivery capacity for the SALCOS project as well as for future projects. In parallel with the 350 MW capacity investment in electrodes, HydrogenPro is considering investments to develop a H2 Gigafactory for the 3^rd generation electrodes in 2027. If the Company chooses to proceed, part of the financing for a H2 gigafactory buildout has already been secured through grants from the Danish government amounting to ≈ NOK 240m. A buildout would bring the total capacity to at least 500 MW in annual electrode capacity, matching the current 500 MW capacity of electrolyzer while enabling flexibility with possible spare capacity, to be used as the Company deems most beneficial, possibly selling the electrode spare capacity to external electrolyzer producers and thereby adding new revenue streams.

The positive results from the joint-full scale validation program together with Andritz, in combination with the possibility of future mass production of electrodes, presents a game-changing potential in terms of HydrogenPro’s offering and competitiveness in the market. As HydrogenPro is leading the way in an innovative space that increases energy efficiency and makes large-scale hydrogen projects more cost-efficient, the Company is positioned to receive orders for more large-scale projects in the future.

In summary, while market conditions remain challenging, the Company has secured a stable financial foundation, strengthening the capital base and enabling continued growth-driven activities such as validation of the 3^rd generation electrodes and associated capacity expansion. Through these measures and a further enhanced partnership with industry leaders, HydrogenPro is positioned to capitalize on the strong sales pipeline of 13.4 GW with a leading electrolyzer solution and groundbreaking electrode technology that increase energy efficiency significantly.

Analyst Group initiates equity research coverage on HydrogenPro (“HydrogenPro” or “the Company”), which includes equity research coverage with, among other things, equity research reports with quarterly updates, comments on press releases and CEO interviews.

HydrogenPro is a leader in high pressure alkaline electrolyzers, which are used to produce green hydrogen. Electrolyzers are evaluated on energy efficiency, where HydrogenPro’s latest tests regarding a groundbreaking electrode technology delivers a substantial improvement with an increase up to 14%, setting a new industry benchmark. The Company has strong global partners and has proven its concept by delivering electrolyzers to some of the largest hydrogen projects to date, and HydrogenPro is uniquely positioned to capitalize on expected market growth in green hydrogen during the forecast period.

About HydrogenPro

HydrogenPro, founded in 2013, pioneers green hydrogen technology solutions. Today, the Company is a technology owner and a global original equipment manufacturer specializing in the world’s largest high-pressure alkaline electrolyzer, electrolyzers are essential for production of green hydrogen. In 2021, the Company established in-house manufacturing capacity in China through a joint venture with Tianjin HQY Hydrogen Machinery, today known as HydrogenPro Tianjin. The plant has a 500 MW annual capacity, capable of producing ≈90 electrolyzers stacks. While manufacturing of electrolyzer components takes place in China, the assembly is conducted locally near end-user’s, thereby securing logistical flexibility and compliance with local regulations.

Three Reasons as to Why HydrogenPro is an Attractive Investment Today

Groundbreaking Energy Efficiency

HydrogenPro holds a competitive advantage with the Company’s high-pressure alkaline electrolyzers, achieving 80% energy efficiency – defined as the share of renewable energy converted to hydrogen rather than lost. Higher energy efficiency lowers the plant operator’s operational costs significantly, as electricity accounts for 70-90% of total project costs in green hydrogen production.

Proof of Concept

The Company has successfully delivered electrolyzers for two large-scale projects: 220 MW with an order value of more than USD 50m and 100 MW with EUR 18m. This validates HydrogenPro’s technology, while demonstrating successful execution in manufacturing and delivery capabilities for large-scale, complex, projects. HydrogenPro’s prioritized sales pipeline was recently updated and totals 12,1 GW, and with established proof of concept, the Company is expected to capitalize on this, securing orders and thereby continuing the growth journey.

Strong Partners with Ownership Stake

HydrogenPro has exclusive partnerships with leading industry players in the industry, which entails that HydrogenPro is an exclusive supplier of electrolyzers for their projects. The partners Mitsubishi, Andritz and Longi have extensive experience securing orders for large-scale projects. Additionally, all three have demonstrated confidence in HydrogenPro’s technology by jointly acquiring a 40% ownership stake, of which Longi’s stake is anticipated to be finalized in Q2. This latest investment of NOK 140m secured financing for the Company while strengthening the partnership and positioning HydrogenPro to secure future orders.

HydrogenPro published the Company’s interim report for the fourth quarter of 2024 on February 25, 2025.

Below are some highlights of the report:

• Revenues amounted to NOK 70 million (NOK 127 million) –primarily related to deliveries for the SALCOS project (100 MW) with Andritz in Germany
• Gross margin amounted to NOK 29 million, representing a 41% gross margin (69%)
• OPEX of NOK 73 million, an increase of NOK 13 million compared to Q3 24, of which approximately NOK 9 million were extraordinary costs of a nonrecurring nature
• EBITDA of NOK -44 million (NOK 17 million), corresponding to a margin of -62% (13%)
• Cash balance of NOK 191 million compared to NOK 188 million at end of Q3 2024, the positive figure is primarily explained by changes in working capital amounting to NOK 58 million
• Strategic capital raise amounting to NOK 70 million secured from key partners Mitsubishi and Andritz, and NOK 70 million expected to be raised from Longi, although pending approval regarding Chinese regulations on foreign investments.

Successful Delivery and Project Execution

During the fourth quarter, HydrogenPro made successful deliveries to the Green Steel SALCOS project with the partner Andritz, demonstrating continued strong project execution regarding components being delivered on time and meeting complex requirements associated with a large-scale green hydrogen project. Most of the electrolyzer components for the Andritz order have now been delivered, with the remaining parts primarily related to the 3^rd generation electrodes. Before these are delivered, a joint full-scale validation program is being conducted together with Andritz in HydrogenPro’s test facility in Herøya. One electrolyzer will be equipped with 50% 3^rd generation electrodes and 50% 2^nd generation for a direct comparison. The test starts now and will conclude in 500 testing hours for one month. Positive results are expected and set to confirm the groundbreaking energy efficiency enhancements of 14% previously demonstrated, associated with the Company’s 3^rd-generation electrodes. The partnership with the global leader Andritz, which assembles components and now cooperates in the validation program, confirms HydrogenPro’s strategic position regarding maintaining a slim organization while utilizing partners’ core competencies to sustain logistical flexibility and validate improvements in electrolyzer performance.

Strategic Investments

The fourth quarter included a market backdrop with several cancellations of previously announced projects, ranging from 50 MW to 200 MW, confirming the challenging market environment observed since 2023. The primary reasons for this market backdrop can be summarized in higher inflation, increased capital costs and lack of government funding, which partly is related to the war in Ukraine and reprioritized investments regarding that matter.

However, the Company continues to make strategic investments, strengthening the position for when the hydrogen market returns to a climate with more positive Final Investment Decisions, the seeds of which are being sown through the European Hydrogen Bank, which has approximately EUR 2,2 billion earmarked for investments in the coming years.

HydrogenPro is taking strategic initiatives in upgrading the annual manufacturing capacity for the 3^rd generation electrodes to 350 MW, securing delivery capacity for the SALCOS project as well as for future projects. In parallel with the 350 MW capacity investment in electrodes, HydrogenPro is planning the development of the H2 Gigafactory for the 3^rd generation electrodes with an additional 500 MW in annual electrode capacity, which match the current 500 MW capacity of electrolyzer while enabling flexibility with the additional 350 MW capacity, to be used as the Company deems most beneficial, possibly selling the electrode spare capacity to external electrolyzer producers and thereby adding new revenue streams.

The expected positive results from the joint-full scale validation program together with Andritz, in combination with future mass production of electrodes, are expected to be a gamechanger in terms of HydrogenPro’s offering and competitiveness in the market. Financing for the H2 gigafactory buildout were secured through grants from the Danish government in 2024 amounting to ≈ NOK 240 million. As HydrogenPro is leading the way in an innovative space that increases energy efficiency and makes large-scale hydrogen projects more cost-efficient, the Company is positioned to receive further potential grants in the future.

The strategic investments have additional associated financing through a recently announced capital raise amounting to NOK 70 million from the partners Andritz and Mitsubishi and an additional NOK 70 million from Longi, both with a 22% share price premium. However, the Longi investment is pending on approval regarding Chinese regulations. While securing financing for strategic investments, this capital injection also strengthens the partnerships further, ensuring a shared interest in securing orders moving forward. The latest partnership with Longi also opens the Chinese market for HydrogenPro, which currently constitutes of 2/3 of the global electrolyzer demand.

Despite several project cancellations, the Company updated the prioritized sales pipeline, which now amounts to 12,1 GW or USD 4,1 billion in potential, demonstrating an expanded addressable market through the new partnerships with Longi and J.H.K.

Strong Financial Position

The cash position increased by NOK 3 million to NOK 191 million, excluding the capital raise of NOK 140 million. The increase is explained by changes in working capital amounting to NOK 58 million. Due to a challenging market, the Company is implementing cost reduction measures, where HydrogenPro is downsizing in Europe while also reducing the use of external consultants. Furthermore, activity in China is being reduced both in the Tianjin manufacturing plant and the Shanghai sales office. The cost reduction initiative is expected to save the Company NOK 40 million on an annual basis. These measures are expected to be temporary, and the Company remains flexible in scaling up activity when the market improves.

In summary, while market conditions remain challenging, the Company has secured a stable financial foundation, strengthening the capital base and enabling continued growth-driven activities such as validation of the 3^rd generation electrodes and associated capacity expansion. Through these measures and a further enhanced partnership with industry leaders, HydrogenPro is positioned to capitalize on the strong sales pipeline of 12,1 GW with a leading electrolyzer solution that increase energy efficiency significantly.

Analyst Group will follow up with an equity research report on HydrogenPro.