Plug Power Expects 2014 Loss as Higher Costs Offset Sales

Plug Power Inc., the fuel-cell system maker that’s the best performer on the Nasdaq in the past year, no longer expects to report a profit this year, as increasing costs offset rising revenue.

The company expects to report a loss, before interest, taxes, depreciation and amortization, of $500,000 to $3 million, Chief Executive Officer Andy Marsh said today on a conference call. In March he predicted positive EBITDA of as much as $3 million for the year. The company has never reported a profit since its 1999 initial public offering.

Sales are increasing as demand for the Latham, New York-based company’s fuel cell-powered forklifts swells. To feed customer interest Marsh plans to double the sales force, an effort that will increase costs by about $2.5 million.

“We need more people on the street so we can grow this company quicker than our projections,” Marsh said today on the call.

Plug is also spending money to integrate ReliOn Inc., the fuel-cell provider it acquired in April. The deal will reduce EBITDA by about $1 million this year, he said.

Marsh said revenue for the year will reach $75 million, a $5 million boost over his earlier forecast, and 2015 sales may reach $135 million.

Plug reported a net loss in the first quarter of $75.9 million, or 57 cents a share, from $8.6 million, or 18 cents, a year earlier, according to a statement today. Sales fell to $5.6 million from $6.4 million.

Stock Warrants

The results were affected by a $68.4 million charge related to the change in fair value of previously issued common stock warrants. Excluding that charge, the first-quarter adjusted loss of 6 cents a share missed the 5-cent average of two analysts’ estimates compiled by Bloomberg.

The shares slid 6.6 percent to $3.82 at the close in New York. Plug has surged more than 1,500 percent in the past 12 months as new orders for its fork lifts increase confidence among investors that its fuel-cell technology is becoming a viable alternative to fossil fuels. The company’s systems produce electricity from hydrogen through a chemical reaction that has no carbon emissions.

Plug’s fuel-cell powered fork lifts have won orders from customers including Wal-Mart Stores Inc. and Central Grocers Inc. this year. The company said yesterday it will deliver more than 3,000 units in 2014.

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