Hexagon Purus

Well positioned to capitalize on the zero emission mobility opportunity

Hexagon Purus enables zero emission mobility for a cleaner energy future. A world-leading provider of Type 4 high-pressure hydrogen cylinders, battery packs and drivetrains for fuel cell electric and battery electric vehicles, Hexagon Purus’ world-class, high-pressure hydrogen storage cylinders also enable distribution, maritime, rail and aerospace applications.

Workforce (FTEs)
142
Facilities
USA, Germany, Canada, Norway
GSP5157

Product Areas

Light-Duty Vehicles
Transit Buses
Distribution
Heavy-Duty Trucks
Maritime & other
Rail
Battery Electric Trucks

Operating results

Hexagon Purus reported e-mobility revenues for the year 2020 that decreased by 15% to NOK 180 million compared with NOK 211 million in 2019. Reported EBITDA was NOK -141 (-143) million. The decline in revenue was due to the completion of an OEM heavy-duty battery electric vehicle (BEV) truck demonstration program which started in 2019 and was completed in Q1 2020. This was partially offset by increased activity with other OEMs in both BEV and fuel cell electric vehicle (FCEV) applications. Continued investments in personnel and infrastructure to support and accelerate Hexagon Purus’ development as well as the incremental costs of being an independent and publicly traded company drove negative profitability. Read more in the Board of Directors’ report.

Key developments and objectives achieved in 2020

  • Hexagon Purus (HPUR.OL) was successfully listed on the Euronext Growth exchange in Oslo, Norway, with Hexagon Composites ASA retaining a c. 75% ownership stake
  • Hexagon Purus raised NOK 750 million in gross proceeds through a private placement in conjunction with the listing
  • Agreed to transfer the CNG LDV business to Hexagon Composites, thus positioning Hexagon Purus as a pure play e-mobility solutions provider
  • Ended the year substantially debt-free and with over NOK 1.2 billion in cash
  • Nominated by a key Northeast Asian automotive leader for the serial supply of hydrogen cylinders for their current zero emission Fuel Cell Electric SUV, with an estimated sales value of EUR 25 million (approx. NOK 268 million)
  • Entered into frame agreement with Everfuel, supporting commercialization of zero emission hydrogen transport in Europe, with an estimated value of approximately EUR 14 million (approx. NOK 150 million)
  • Awarded to supply hydrogen systems to Toyota Motor North America (TMNA) for its newest prototype hydrogen-powered heavy-duty fuel cell electric truck
  • Awarded a contract by Hino Trucks, a Toyota Motors Company, to provide battery packs and powertrain integration for the development of Hino’s “Project Z” path to zero emission vehicles
  • Awarded a USD 5.2 million (approx. NOK 49 million) contract for high-performance Type 4 pressure vessels for a new aerospace customer
  • Signed a contract with Stadler Rail to develop and supply hydrogen cylinder storage systems for the first hydrogen commuter train in the U.S.

Key developments after balance sheet date

  • Signed joint venture agreements with CIMC Enric in March 2021, to enter the world’s largest zero emission hydrogen vehicle and distribution market
  • Selected by Talgo S.A., a leading manufacturer of intercity, standard and high-speed passenger trains, to deliver high pressure cylinders for its first prototype hydrogen train
  • Received orders from a global industrial gas company to provide cylinders for hydrogen transportation
  • Awarded an order for hydrogen cylinders from New Flyer, North America’s largest transit bus OEM

Objectives for 2021–2022

  • Grow revenue by at least 50% in 2021
  • Build organizational capabilities and resources to successfully execute on various strategic and growth initiatives
  • Prepare facilities in North America and Europe for increased volumes
  • Execute ramp up plan in China together with JV partner
  • Successfully execute existing FCEV and BEV heavy duty programs
  • Diversify customer base
  • Further improve cost efficiency and manufacturing productivity with increased automation and optimized value streams

Driving the transition to zero emission mobility

The momentum for a decarbonized future, of which zero emission transportation is a key foundational pillar, continues to build across the world. With several decades of experience in high pressure vessel technology through the Hexagon Composites lineage, Hexagon Purus is very well positioned across the hydrogen value chain with vehicle cylinders and storage systems for cars, trucks, buses, distribution, maritime, rail and aerospace applications. Additionally, with the contribution of Hexagon Agility’s hydrogen and EV business, Hexagon Purus has complete medium and heavy duty vehicle battery pack and electric drivetrain integration capabilities working with some of the world’s largest OEMs.

Hexagon Purus is one of the market leaders within the heavy duty battery electric (BEV) and fuel cell electric (FCEV) space with early success in flagship demonstration programs such as Daimler’s Innovation Fleet and ongoing development programs with Hino Trucks and Toyota Motors North America. This success builds on several years of experience of integrating low and zero emission energy storage systems on to heavy duty vehicles in highly demanding duty cycles. Hexagon Purus leads the way with energy dense, lightweight, durable and safe zero emission energy storage solutions (both hydrogen and battery) and has also developed strong vehicle integration capabilities.

Many opportunities are presenting themselves particularly in medium/heavy duty vehicle and hydrogen distribution applications. Additionally, there has been an uptick in interest in hydrogen for rail and maritime applications.

Light Duty Vehicles

In August 2020, Hexagon Purus was selected by a key Northeast Asian OEM for the serial supply of composite cylinders for their current zero emission Fuel Cell Electric SUV. The scope of the nomination is over a two-year period with an estimated sales value of EUR 25 million. The nomination also positions Hexagon Purus for further projects within a larger range of vehicle applications with this OEM.

Trucks

The zero emission medium/heavy duty truck market is developing at a rapid pace, particularly in North America, with a near-term focus on battery electric (BEV) solutions and a somewhat solutions. Hexagon Purus sees strong interest in the company’s hydrogen fuel storage and battery pack as well as electric drivetrain solutions and is involved in a number of ongoing development projects in the segment.

During the year Hexagon Purus was awarded a purchase order by Hino Trucks, a Toyota Motors company, to provide battery packs and drivetrain integration for three trucks as part of Hino’s “Project Z” BEV program.

Hexagon Purus was also awarded a contract to supply hydrogen systems to Toyota Motor North America (TMNA) for its newest prototype hydrogen-powered heavy-duty fuel cell electric truck powertrains. This was the third heavy-duty truck project in three years that Hexagon Purus collaborated on with Toyota. Earlier projects included Toyota’s proof of concept for the Los Angeles Ports, supporting the ports’ efforts to reduce harmful emissions (2017), and a hydrogen city bus from CaetanoBus that utilizes Toyota’s leading fuel cell electric technology (2019).

Transit

Interest in the company’s hydrogen cylinder and storage systems capabilities continues to grow in the bus segment.

In January 2021, New Flyer, North America’s largest transit bus manufacturer and an existing customer of the company, placed an order for the supply of high-pressure hydrogen cylinders for their zero emission Xcelsior CHARGE H2TM hydrogen fuel cell electric transit buses.

In addition, Hexagon Purus has previously been awarded development projects with CaetanoBus and Solaris to deliver hydrogen fuel storage systems.

During the year the H2Bus consortium announced an agreement with Wrightbus for the supply of hydrogen fuel cell electric buses in Europe. The consortium, in which Hexagon Purus is a member supplier of its on-board hydrogen storage solutions aims to deploy 1,000 hydrogen fuel cell electric buses, along with supporting infrastructure, in European cities at commercially competitive rates.

Hydrogen distribution

The demand for hydrogen distribution solutions is expected to grow as a result of increased energy demand. Hexagon Purus has served large industrial gas companies for several years. With increasing uses of hydrogen not only as an industrial gas but also more recently as a transportation fuel, the company is seeing rapidly increasing interest in its solutions in Europe and North America which enable hydrogen to be transported from the point of production to the point of use or sale. The market is steadily converting from heavier Type 1 to lighter and more efficient Type 4 cylinders.

During the year, Hexagon Purus signed a multiyear master frame agreement with Everfuel to deliver multiple units of newly designed 45-foot, hydrogen distribution systems with an estimated sales value of EUR 14 million (approx. NOK 150 million). The systems will be used to transport hydrogen to refuelling stations serving hydrogen fuel cell electric passenger car fleets (e.g. taxis), trucks and buses. At signing, Everfuel ordered its first six distribution units under the new frame agreement. The new system with a nominal payload capacity of 958 kg of compressed hydrogen at 300 bar includes an advanced monitoring system for improved filling efficiency and will be produced at Hexagon Purus’ production and assembly facility in Kassel, Germany.

Additionally, during the year, Hexagon Purus signed a contract with a major US hydrogen fuel supplier and refuelling station operator to provide multiple X-STORE transport modules for the distribution of high-pressure hydrogen gas with an estimated sales value of USD 4.8 million (approx. NOK 45 million). This represented the first order of its kind for the company in North America.

Rail and Maritime

Hexagon Purus is at the forefront of developing hydrogen solutions for the rail and maritime industry. The company is involved in several ongoing rail projects both in Europe and North America.

HEXAGON 01

The company signed a contract with Stadler Rail to develop cylinder storage system for the first hydrogen commuter train in the U.S. The contract includes the development and homologation of a new cylinder and tank system to be approved in the U.S. The train will be built and tested in Switzerland and other European locations, then transferred to California in 2023.

In addition, in January 2021 Hexagon Purus received an order to deliver high pressure cylinders to Talgo, S.A., a leading manufacturer of intercity, standard and highspeed passenger trains, for its first hydrogen prototype train on Spain.

Through its Hyon AS joint venture and Norwegian Hydrogen AS partnership, Hexagon Purus is involved in several ongoing demonstration projects in the Norwegian maritime sector where public funding (PILOT-E) has been made available for both hydrogen systems onboard vessels as well as the refueling infrastructure. Given the growing market interest for zero emission solutions in the maritime sector, Hexagon Purus intends to accelerate its commercial efforts within this segment.

Outlook

With its spin-off from Hexagon Composites ASA completed, Hexagon Purus is well positioned to pursue its own strategic and investment priorities and to reinforce its leading position in the rapidly growing e-mobility space. The company has a well-capitalized balance sheet and can continue to benefit from its close industrial linkage with the Hexagon Group. With strong activity, particularly in medium- and heavy-duty truck, transit bus and distribution module applications, Hexagon Purus expects to achieve more than 50% revenue growth in 2021.

Substantial organizational and capacity investments are being made to develop Hexagon Purus’ capabilities and to position it for future growth. These investments impact short- and medium-term profitability but are expected to be accretive to longer-term shareholder value. These investments also include actions necessary to secure a strong foothold and grow the Company’s presence in China.

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