(Reuters) - Canadian fuel cell maker Hydrogenics Corp’s (HYG.TO) HYGS.O quarterly net loss tripled as costs jumped and customers delayed taking deliveries, driving the company’s shares down as much as 15 percent.
The company’s quarterly sales fell for the first time in two years and its order backlog for the first quarter ended March 31 rose 2.6 percent, slower than the growth in the preceding two quarters.
Hydrogenics’ results also weighed on the shares of rival fuel cell makers Ballard Power Systems Inc BLD.TO BLDP.O and Fuel Cell Energy Inc (FCEL.O).
Fuel cells convert hydrogen and oxygen into electricity and offer a cleaner alternative to lead-acid batteries. They are used in everything from power backup to forklifts to refrigerators.
The clean technology had captured the attention of investors over the past year and they pushed the stock of fuel cell makers rose to multi-year highs earlier this year.
But lingering worries about the sustainability of the companies were aggravated last week when privately owned fuel cell maker ClearEdge Power Inc filed for bankruptcy protection.
“I think the Clear Edge filing will make it difficult for less mature or commercially centered players to attract capital,” Canaccord Genuity analyst Sara Elford told Reuters earlier this week.
Hydrogenics on Wednesday reported that its net loss widened to $3.7 million, or 41 cents per share, in the first quarter from $1.1 million, or 15 cents per share, a year earlier.
Operating costs rose 22.3 percent.
The Mississauga, Ontario-based company’s sales fell by more than a third to $8.1 million, hurt by the customer delays it had warned of in early April and the absence of deliveries to a key partner, that had helped the year-earlier quarter.
The company reaffirmed its full-year revenue forecast of at least $50 million. Analysts’ on average were expecting revenue of $53.8 million, according to Thomson Reuters I/B/E/S.
Hydrogenics shares fell to a low of $18.27 by late morning on Wednesday on the Nasdaq. The stock hit a six-year high of $35.52 on March 11 but has since fallen nearly 40 percent, excluding Wednesday’s losses.
Short interest in the stock has touched a five-year high with nearly 4.7 percent of the stock have being sold short as of April 15, according to Thomson Reuters data.
However, the short interest in Hydrogenics is less than that in Plug Power Inc (PLUG.O), Ballard and Fuel Cell, all of whom have a short interest in the 10-20 percent range.
Investors who borrow and sell shares short are betting that bad news will push prices down, allowing them to buy and return the shares at a lower price and pocket the difference.
Writing by Sayantani Ghosh in Bangalore; Editing by Savio D'Souza