Economic success with hydrogen technology: For the second quarter and the first half of 2023/2024, Thyssenkrupp Nucera reports strong sales growth of 59% in its alkaline water electrolysis (AWE). Despite this positive development, the company is observing delays in final investment decisions among many of its customers, affecting the order situation.
In the field of alkaline water electrolysis (AWE), the company reported new orders of 11.6 million euros as of May 15, down from 82.0 million euros in the second quarter of 2022/2023. The order intake in the chlor-alkali (CA) sector increased by nearly one-third (30%) to 63.6 million euros (previous year's quarter: 48.9 million euros).
Despite the positive developments on the order side, there were also slowing factors. Increasingly, many potential customers are showing delays in making final investment decisions.
Overall, order intake in the first six months of the current reporting year was 250.8 million euros, 14.0% below the previous year's figure. However, the company expects a significant increase in order intake in the coming quarters.
As of March 31, 2024, the order backlog reached approximately 1.2 billion euros, of which 0.8 billion euros were attributable to the AWE business and 0.5 billion euros to the CA business. Nucera CFO Arno Pfannschmidt stated that the market for green hydrogen continues to offer "very high growth potential": "We at Thyssenkrupp Nucera are very well positioned with our strong financial power and our highly efficient electrolysis technology to exploit this potential. We therefore expect order intake to grow more strongly again."
Sales of Alkaline Water Electrolysis Grows by 59 Percent
According to the company, Nucera increased its sales in the second quarter of the current fiscal year by 11.1% to 168.0 million euros. The growth driver was sales of electrolyzers for the production of green hydrogen.
The "rapid" project execution in Saudi Arabia, Brazil, and Sweden led to a 59.1% increase in AWE sales to 95.0 million euros. In the CA business, sales fell by 20.2% to 73.0 million euros. The increase in new construction business could not offset the decline in service business "as expected"; the latter had grown very strongly in the previous year.
Overall, sales in the first half of 2023/2024 were 376.3 million euros, nearly a quarter (23%) higher than the previous year's figure. In the AWE business, sales increased even more significantly by 68.6% to a record level of 215.8 million euros. The AWE sales increase was driven in particular by the good progress of the NEOM project in Saudi Arabia. The Unigel project in Brazil and H2 Green Steel in Sweden also contributed to the positive development in the first half of the year.
Total Sales of Nearly 1 Billion Euros
At the end of the second quarter (March 31, 2024), the company employed 855 people worldwide, according to its own statements. Compared to the previous year, the number of employees increased by 261. Research and development costs almost doubled in the second quarter from 4.4 to 9.2 million euros. In the first half, they increased from 7.6 to 14.6 million euros.
The higher expenses due to the implementation of the strategy, a lower gross margin due to a higher AWE share of total sales, and mix effects from the lower service business led to a negative earnings before interest and taxes (EBIT) of -10.6 million euros in the second quarter of 2023/2024 (previous year's quarter: 2.3 million euros). In the first six months of the current fiscal year 2023/2024, the EBIT of the electrolyzer manufacturer "as expected" fell to -11.4 million euros (previous year's period: 13.3 million euros).
Currently, the Thyssenkrupp subsidiary expects total sales in the range of 820 to 900 million euros. The expected growth momentum will be mainly driven by the execution of already contractually agreed projects in the AWE sector. The company estimates AWE sales for the fiscal year 2023/2024 at 500 to 550 million euros compared to the previous year's figure of 323 million euros.
