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Plug Power collapses after 'going concern' warning from hydrogen developer

Plug Power, which provides fuel cells for electrified industrial vehicles used by Amazon and Walmart, warned last night that it may not be able to survive it current cash squeeze.

Martin BaccardaxUpdated:Nov 10, 2023 8:04 AM EST
Updated at 8:03 am EST

https://finance.yahoo.com/m/d02dd117-de2f-314e-b871-7d98c20ba770/plug-power-collapses-after.html

Plug Power (PLUG) - shares plunged lower Friday after the hydrogen-fuel-cell developer warned that it may not be able to continue operations amid supply chain disruptions and a severe cash burn rate.

Plug Power, which provides fuel cells for electrified industrial vehicles used by Amazon (AMZN) - Get Free Report and Walmart (WMT) - also posted weaker-than-expected third quarter sales of $199 million last night, thanks in part to what it described as "unprecedented hydrogen supply challenges" in the north American hydrogen market.

In a later filing with the Securities and Exchange Commission, however, Plug Power also added that given its current cash position and expected capital spending, there is "substantial doubt about the Company’s ability to continue as a going concern."

The group is seeking a $1.5 billion loan from the Department of Energy, as part of its green hydrogen network financing, but funds are unlikely to being flowing into the Latham, New York-based group until early next year.

"To alleviate the conditions and events that raise substantial doubt about the Company’s ability to continue as a going concern, management is currently evaluating several different options to enhance the Company’s liquidity position, including the sale of securities, incurrence of debt or other financing alternative," Plug Power said.

"The Company’s plan includes various financing solutions from third parties with a particular focus on corporate level debt solutions, investment tax credit related project financings and loan guarantee programs, and/or large scale hydrogen generation infrastructure project financing," Plug Power added in the 10-Q filing.