Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jul. 31, 2017 | Sep. 06, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | FUELCELL ENERGY INC | |
Entity Central Index Key | 886,128 | |
Document Type | 10-Q | |
Document Period End Date | Jul. 31, 2017 | |
Amendment Flag | false | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q3 | |
Trading Symbol | FCEL | |
Current Fiscal Year End Date | --10-31 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 61,485,741 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 |
Current assets: | ||
Cash and cash equivalents, unrestricted | $ 35,683 | $ 84,187 |
Restricted cash and cash equivalents - short-term | 4,605 | 9,437 |
Accounts receivable, net | 26,316 | 24,593 |
Inventories | 71,984 | 73,806 |
Other current assets | 6,011 | 10,181 |
Total current assets | 144,599 | 202,204 |
Restricted cash and cash equivalents - long-term | 33,480 | 24,692 |
Project assets | 67,201 | 47,111 |
Property, plant and equipment, net | 41,876 | 36,640 |
Goodwill | 4,075 | 4,075 |
Intangible asset | 9,592 | 9,592 |
Other assets | 16,445 | 16,415 |
Total assets | 317,268 | 340,729 |
Current liabilities: | ||
Current portion of long-term debt | 21,738 | 5,010 |
Accounts payable | 8,757 | 18,475 |
Accrued liabilities | 13,122 | 20,900 |
Deferred revenue | 8,971 | 6,811 |
Preferred stock obligation of subsidiary | 862 | 802 |
Total current liabilities | 53,450 | 51,998 |
Long-term deferred revenue | 19,430 | 20,974 |
Long-term preferred stock obligation of subsidiary | 14,380 | 12,649 |
Long-term debt and other liabilities | 70,338 | 80,855 |
Total liabilities | 157,598 | 166,476 |
Redeemable preferred stock (liquidation preference of $64,020 as of July 31, 2017 and October 31, 2016) | 59,857 | 59,857 |
Shareholders’ equity: | ||
Common stock ($0.0001 par value); 125,000,000 and 75,000,000 shares authorized as of July 31, 2017 and October 31, 2016, respectively; 60,972,037 and 35,174,424 shares issued and outstanding as of July 31, 2017 and October 31, 2016, respectively | 6 | 4 |
Additional paid-in capital | 1,033,744 | 1,004,566 |
Accumulated deficit | (933,554) | (889,630) |
Accumulated other comprehensive loss | (383) | (544) |
Treasury stock, Common, at cost (88,861 and 21,527 shares as of July 31, 2017 and October 31, 2016, respectively) | (280) | (179) |
Deferred compensation | 280 | 179 |
Total shareholders’ equity | 99,813 | 114,396 |
Total liabilities and shareholders' equity | $ 317,268 | $ 340,729 |
Consolidated Balance Sheets (U3
Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 |
Statement Of Financial Position [Abstract] | ||
Preferred Stock, Liquidation Preference, Value | $ 64,020 | $ 64,020 |
Common stock, par value | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 125,000,000 | 75,000,000 |
Common stock, shares issued | 60,972,037 | 35,174,424 |
Common stock, shares outstanding | 60,972,037 | 35,174,424 |
Treasury stock, shares | 88,861 | 21,527 |
Consolidated Statements of Oper
Consolidated Statements of Operations (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2017 | Jul. 31, 2016 | |
Revenues: | ||||
Product | $ 611 | $ 13,681 | $ 3,155 | $ 54,178 |
Service and license | 4,809 | 4,280 | 24,337 | 20,840 |
Generation | 1,690 | 200 | 5,409 | 533 |
Advanced technologies | 3,248 | 3,555 | 14,876 | 8,228 |
Total revenues | 10,358 | 21,716 | 47,777 | 83,779 |
Costs of revenues: | ||||
Product | 4,266 | 13,740 | 11,525 | 53,247 |
Service and license | 4,453 | 4,087 | 22,878 | 21,527 |
Generation | 1,500 | 197 | 3,909 | 596 |
Advanced technologies | 2,765 | 3,258 | 9,895 | 8,298 |
Total costs of revenues | 12,984 | 21,282 | 48,207 | 83,668 |
Gross (loss) profit | (2,626) | 434 | (430) | 111 |
Operating expenses: | ||||
Administrative and selling expenses | 6,310 | 5,458 | 18,797 | 18,939 |
Research and development expenses | 5,394 | 5,299 | 16,172 | 15,720 |
Restructuring expense | 1,355 | |||
Total costs and expenses | 11,704 | 10,757 | 36,324 | 34,659 |
Loss from operations | (14,330) | (10,323) | (36,754) | (34,548) |
Interest expense | (2,279) | (1,373) | (6,856) | (3,200) |
Other (expense) income, net | (393) | 749 | (270) | (110) |
Loss before provision for income taxes | (17,002) | (10,947) | (43,880) | (37,858) |
Benefit (provision) for income taxes | 1 | (120) | (44) | (402) |
Net loss | (17,001) | (11,067) | (43,924) | (38,260) |
Net loss attributable to noncontrolling interest | 0 | 57 | 0 | 165 |
Net loss attributable to FuelCell Energy, Inc. | (17,001) | (11,010) | (43,924) | (38,095) |
Preferred stock dividends | (800) | (800) | (2,400) | (2,400) |
Net loss attributable to common shareholders | $ (17,801) | $ (11,810) | $ (46,324) | $ (40,495) |
Loss per share basic and diluted: | ||||
Net loss per share attributable to common shareholders | $ (0.31) | $ (0.38) | $ (1.01) | $ (1.41) |
Basic and diluted weighted average shares outstanding | 57,420,050 | 31,015,658 | 45,903,033 | 28,680,596 |
Consolidated Statements of Ope5
Consolidated Statements of Operations (Unaudited) (Parenthetical) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2017 | Jul. 31, 2016 | |
Product | $ 611 | $ 13,681 | $ 3,155 | $ 54,178 |
Service and license | 4,809 | 4,280 | 24,337 | 20,840 |
Related Party [Member] | ||||
Product | 100 | 12,000 | 400 | 37,300 |
Service and license | $ 1,300 | $ 2,300 | $ 4,200 | $ 6,900 |
Statement of Comprehensive Loss
Statement of Comprehensive Loss Statement - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2017 | Jul. 31, 2016 | |
Statement Of Income And Comprehensive Income [Abstract] | ||||
Net loss | $ (17,001) | $ (11,067) | $ (43,924) | $ (38,260) |
Foreign currency translation adjustments | 199 | (228) | 161 | (26) |
Total comprehensive loss | $ (16,802) | $ (11,295) | $ (43,763) | $ (38,286) |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2017 | Jul. 31, 2016 | |
Cash flows from operating activities: | ||
Net loss | $ (43,924) | $ (38,260) |
Adjustments to reconcile net loss to net cash used in operating activities: | ||
Share-based compensation | 3,432 | 2,530 |
Loss (gain) from change in fair value of embedded derivatives | 94 | (16) |
Depreciation | 6,502 | 3,583 |
Interest expense on preferred stock and debt obligations | 4,607 | 2,193 |
Unrealized foreign exchange losses | 1,052 | 41 |
Other non-cash transactions, net | 165 | 303 |
(Increase) decrease in operating assets: | ||
Accounts receivable | (9,296) | 26,590 |
Inventories | (5,460) | (12,450) |
Project assets | 0 | (15,459) |
Other assets | 85 | 108 |
(Decrease) increase in operating liabilities: | ||
Accounts payable | (8,147) | (196) |
Accrued liabilities | (7,547) | (145) |
Deferred revenue | 616 | (15,333) |
Net cash used in operating activities | (57,821) | (46,511) |
Cash flows from investing activities: | ||
Capital expenditures | (10,469) | (3,962) |
Project asset expenditures | (12,796) | (6,505) |
Cash acquired from asset acquisition | 633 | 0 |
Net cash used in investing activities | (22,632) | (10,467) |
Cash flows from financing activities: | ||
Repayment of debt | (7,467) | (9,549) |
Proceeds from debt | 17,891 | 44,781 |
Payment of deferred financing costs | (119) | (994) |
Payment of preferred dividends and return of capital | (3,102) | (3,125) |
Cash received for common stock issued for stock plans | 86 | 177 |
Proceeds from sale of common stock, prefunded warrants and warrant exercises, net | 28,455 | 68,785 |
Net cash provided by financing activities | 35,744 | 100,075 |
Effects on cash from changes in foreign currency rates | 161 | (26) |
Net (decrease) increase in cash, cash equivalents and restricted cash | (44,548) | 43,071 |
Cash, cash equivalents and restricted cash-beginning of period | 118,316 | 85,740 |
Cash, cash equivalents and restricted cash-end of period | 73,768 | 128,811 |
Supplemental cash flow disclosures: | ||
Cash interest paid | 2,022 | 1,295 |
Noncash financing and investing activity: | ||
Common stock issued for Employee Stock Purchase Plan in settlement of prior year accrued employee contributions | 50 | 105 |
Noncash reclass of inventory to project assets | 7,282 | 0 |
Assumption of debt in conjunction with asset acquisition | 2,289 | 0 |
Acquisition of project assets | 2,386 | 0 |
Accrued purchase of fixed assets, cash paid in subsequent period | 1,581 | 453 |
Accrued purchase of project assets, cash paid in subsequent period | $ 2,597 | $ 0 |
Nature of Business and Basis of
Nature of Business and Basis of Presentation | 9 Months Ended |
Jul. 31, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Nature of Business and Basis of Presentation | Note 1. Nature of Business and Basis of Presentation FuelCell Energy, Inc. together with its subsidiaries (the “Company”, “FuelCell Energy”, “we”, “us”, or “our”) is a leading integrated fuel cell company with a growing global presence. We design, manufacture, install, operate and service ultra-clean, efficient and reliable stationary fuel cell power plants. Our SureSource power plants predictably generate electricity and usable high quality heat for commercial, industrial, government and utility customers. We have commercialized our stationary carbonate fuel cells and are also pursuing the complementary development of planar solid oxide fuel cells and other fuel cell technologies. Our operations are funded primarily through sales of equity instruments to strategic investors or in public markets, corporate and project level debt financing and local or state government loans or grants. In order to produce positive cash flow from operations, we need to be successful at increasing annual order volume and production and in our cost reduction efforts. Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial information. Accordingly, they do not contain all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of management, all normal and recurring adjustments necessary to fairly present our financial position and results of operations as of and for the three and nine months ended July 31, 2017 have been included. All intercompany accounts and transactions have been eliminated. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The balance sheet as of October 31, 2016 has been derived from the audited financial statements at that date, but it does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These financial statements should be read in conjunction with our financial statements and notes thereto for the year ended October 31, 2016, which are contained in our Annual Report on Form 10-K previously filed with the SEC. The results of operations for the interim periods presented are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year. Certain reclassifications have been made to conform to the current year presentation. The Company has adopted Accounting Standards Update (“ASU”) 2015-03, Interest – Imputation of Interest effective January 31, 2017, and retrospective application is required which resulted in a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $0.3 million of debt issuance costs from Current assets to be a direct deduction from Current portion of long-term debt and a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $1.1 million of debt issuance costs from Other assets, net to be a direct deduction from Long-term debt and other liabilities. The Company has also early adopted ASU 2016-18, “Statement of Cash Flows (Topic 230) Restricted Cash” effective October 31, 2016 and has applied a retrospective transition method. Accordingly, Restricted cash and cash equivalents has been reclassified as a component of “Cash, cash equivalents, and restricted cash” in the Consolidated Statement of Cash Flows for nine months ended July 31, 2016. The Company has also included an additional line item, “Generation,” in the “Revenues” and “Cost of revenues” sections of the Statements of Operations to include revenues generated from the Company’s project assets (refer to the Revenue Recognition section below for more information). The prior year amounts associated with power purchase agreements have been reclassified to the new “Generation” line item. Revenue Recognition We earn revenue from (i) the sale and installation of fuel cell power plants (ii) the sale of component part kits, modules and spare parts to customers, (iii) site engineering and construction services, (iv) performance under long-term service agreements, (v) the sale of electricity and other value streams under power purchase agreements (“PPAs”) and project assets retained by the Company under sales-leaseback transactions, (vi) license fees and royalty income from manufacturing and technology transfer agreements, and (vii) government and customer-sponsored advanced technology projects. Given the growing revenue related to PPAs and project assets retained by the Company, beginning in the first quarter of 2017, the Company began classifying such revenues in a separate line item called Generation, and prior period amounts have been reclassified. As further clarification, revenue elements are classified as follows: Product. Includes the sale and installation of fuel cell power plants, the sale of component part kits, modules and spare parts to customers, and site engineering and construction services. Service and license. Includes performance under long-term service agreements for power plants owned by third parties and license fees and royalty income from manufacturing and technology transfer agreements. Generation. Includes the sale of electricity under PPAs and project assets retained by the Company, and revenue received from the sale of other value streams from these assets including the sale of heat, steam and renewable energy credits. Advanced technologies. Includes revenue from customer-sponsored and government-sponsored advanced technology projects that is recorded as “Advanced technologies” revenues in the Consolidated Statements of Operations. Our revenue is primarily generated from customers located throughout the U.S., Europe and Asia and from agencies of the U.S. Government. For customer contracts for complete SureSource power plants, with which the Company has adequate cost history and estimating experience, and with respect to which management believes it can reasonably estimate total contract costs, revenue is recognized under the percentage of completion method of accounting. The use of percentage of completion accounting requires significant judgment relative to estimating total contract costs, including assumptions relative to the length of time to complete the contract, the nature and complexity of the work to be performed, anticipated increases in wages and prices for subcontractor services and materials, and the availability of subcontractor services and materials. Our estimates are based upon the professional knowledge and experience of our engineers, project managers and other personnel, who review each long-term contract on a quarterly basis to assess the contract’s schedule, performance, technical matters and estimated cost at completion. When changes in estimated contract costs are identified, such revisions may result in current period adjustments to operations applicable to performance in prior periods. Revenues are recognized based on the percentage of the contract value that incurred costs to date bear to estimated total contract costs, after giving effect to estimates of costs to complete based on most recent information. For customer contracts for new or significantly customized products, where management does not believe it has the ability to reasonably estimate total contract costs, revenue is recognized using the completed contract method and therefore all revenue and costs for the contract are deferred and not recognized until installation and acceptance of the power plant is complete. We recognize anticipated contract losses as soon as they become known and estimable. Actual results could vary from initial estimates and estimates will be updated as conditions change. Site engineering and construction services revenue is recognized on a percentage of completion basis as costs are incurred. Revenue from fuel cell kits, modules and spare parts sales is recognized upon shipment or title transfer under the terms of the customer contract. Terms for certain contracts provide for a transfer of title and risk of loss to our customers at our factory locations upon completion of our contractual requirement to produce products and prepare the products for shipment. A shipment in place may occur in the event that the customer is not ready to take delivery of the products on the contractually specified delivery dates. Revenue from service agreements is generally recorded ratably over the term of the service agreement, as our performance of routine monitoring and maintenance under these service agreements is generally expected to be incurred on a straight-line basis. For service agreements where we expect to have a module exchange at some point during the term (generally service agreements in excess of five years), the costs of performance are not expected to be incurred on a straight-line basis, and therefore, a portion of the initial contract value related to the module exchange is deferred and is recognized upon such module replacement event. The Company receives license fees and royalty income from POSCO Energy (“POSCO”) as a result of manufacturing and technology transfer agreements entered into in 2007, 2009 and 2012. The Cell Technology Transfer Agreement we entered into on October 31, 2012 provides POSCO with a technology license to manufacture SureSource power plants in South Korea. On March 17, 2017, the Company entered into a Memorandum of Understanding (“2017 MOU”) with POSCO to engage in discussions to further amend the above referenced agreements and other agreements between the parties, as well as engaging in discussions relating to entering into new agreements to further the parties mutual interests. The 2017 MOU contemplates that POSCO will continue to service the existing installed base of fuel cell plants in South Korea. In addition, the 2017 MOU contemplates entering into a module procurement agreement with POSCO that the Company anticipates will provide that POSCO will commit to a specified level of module purchases from the Company to supplement its own local manufacturing for servicing its existing fleet. Definitive agreements are expected to be finalized in 2017 subject to completion of due diligence, regulatory approvals, and customary closing conditions. Pursuant to the 2017 MOU, the Company commenced marketing the entire suite of SureSource solutions in South Korea as well as the broader Asian markets for the supply, recovery and storage of energy. Under PPAs and project assets retained by the Company, revenue from the sale of electricity and other value streams is recognized as electricity is provided to the customer. These revenues are classified as a component of generation revenues. Advanced technologies contracts include both private industry and government entities. Revenue from most government sponsored advanced technology projects is recognized as direct costs are incurred plus allowable overhead less cost share requirements, if any. Revenue from fixed price advanced technology projects is recognized using percentage of completion accounting. Advanced technology programs are often multi-year projects or structured in phases with subsequent phases dependent on reaching certain milestones prior to additional funding being authorized. Government contracts are typically structured with cost-reimbursement and/or cost-shared type contracts or cooperative agreements. We are reimbursed for reasonable and allocable costs up to the reimbursement limits set by the contract or cooperative agreement, and on certain contracts we are reimbursed only a portion of the costs incurred. Use of Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Estimates are used in accounting for, among other things, revenue recognition, excess, slow-moving and obsolete inventories, product warranty costs, accruals for service agreements, allowance for uncollectible receivables, depreciation and amortization, impairment of goodwill, indefinite-lived intangible assets and long-lived assets, income taxes, and contingencies. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Due to the inherent uncertainty involved in making estimates, actual results in future periods may differ from those estimates. Related Parties POSCO is a related party and owned approximately 4.0% of the outstanding common shares of the Company as of July 31, 2017. Revenues from POSCO for the three months ended July 31, 2017 and 2016 represent 13% and 65%, respectively, of consolidated revenues and revenues from POSCO for the nine months ended July 31, 2017 and 2016 represent 9% and 52%, respectively, of consolidated revenues. NRG Energy, Inc. (“NRG”) is a related party and owned approximately 2.0% of the outstanding common shares of the Company as of July 31, 2017. NRG Yield is a dividend growth-oriented company formed by NRG that owns, operates and acquires a diversified portfolio of contracted renewable and conventional generation and thermal infrastructure assets in the United States. Revenues from NRG and NRG Yield for the three months ended July 31, 2017 and 2016 represent 0.6% and 0.3%, respectively, of consolidated revenues and revenues form NRG and NRG Yield for the nine months ended July 31, 2017 and 2016 represent 0.4% and 0.2%, respectively, of consolidated revenues. Recent Developments Production Rate Adjustment : In June 2017, the Company reduced its production to approximately fifteen megawatts on an annualized basis. This adjustment was made to manage inventory levels, prepare to transition to new product introductions and complete certain building expansion activities. From June through September 2017 approximately 110 manufacturing employees will work shortened work weeks. The Company is participating in the State of Connecticut’s “Shared Work Program” allowing affected employees to collect unemployment benefits for days they do not work. This production level is anticipated to be temporary and will be reevaluated as order flow dictates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements (Notes) | 9 Months Ended |
Jul. 31, 2017 | |
Recent Accounting Pronouncements [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles | Recently Adopted Accounting Guidance In October 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-18, “Statement of Cash Flows (Topic 230) Restricted Cash.” The amendments require that a statement of cash flows explain the change during the period in the total of cash, cash equivalents, and amounts generally described as restricted cash or restricted cash equivalents. Therefore, amounts generally described as restricted cash and restricted cash equivalents should be included with cash and cash equivalents when reconciling the beginning-of-period and end-of-period total amounts shown on the statement of cash flows. The Company early-adopted ASU 2016-18 as of October 31, 2016 using the retrospective transition method. Accordingly, the Consolidated Statement of Cash Flows for the nine months ended July 31, 2016 has been revised to include “Restricted cash and cash equivalents” as a component of “cash, cash equivalents, and restricted cash.” In April 2015, the FASB issued ASU 2015-03, “Interest – Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs.” This ASU simplifies the presentation of debt issuance costs by requiring that such costs be presented in the balance sheet as a direct deduction from the carrying value of the associated debt instrument, consistent with debt discounts. The Company has adopted ASU 2015-03 effective January 31, 2017 and retrospective application is required which resulted in a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $0.3 million of debt issuance costs from Current assets to be a direct deduction from “Current portion of long-term debt” and a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $1.1 million of debt issuance costs from “Other assets” to be a direct deduction from Long-term debt and other liabilities. In January 2017, the FASB issued ASU 2017-01, “Business Combinations.” ASU 2017-01 was issued to clarify the definition of a business with the objective of adding guidance to assist entities with evaluating whether transactions should be accounted for as acquisitions (or disposals) of assets or businesses. The Company has elected to early adopt ASU 2017-01 effective November 1, 2016. |
Description of New Accounting Pronouncements Not yet Adopted | Recent Accounting Guidance Not Yet Effective In February 2016, the FASB issued ASU 2016-02, “Leases” which, for operating leases, requires a lessee to recognize a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in its balance sheet. The standard also requires a lessee to recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease term, on a generally straight-line basis. This ASU is effective for public companies for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years (first quarter of fiscal year 2020 for the Company). Early adoption is permitted. The Company has both operating and capital leases (refer to Note 16. Commitments and contingences) as well as sale-leasebacks accounted for under the finance method and may have other arrangements that contain embedded leases as characterized in this ASU. We expect this will result in the recognition of right-of-use assets and lease liabilities not currently recorded in our consolidated financial statements under existing accounting guidance, however we are still evaluating all of the Company’s contractual arrangements and the impact that adoption of ASU 2016-02 will have on the Company’s consolidated financial statements. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606).” This topic provides for five principles which should be followed to determine the appropriate amount and timing of revenue recognition for the transfer of goods and services to customers. The principles in this ASU should be applied to all contracts with customers regardless of industry. The amendments in this ASU are effective for fiscal years, and interim periods within those years beginning after December 15, 2016, with two transition methods of adoption allowed. Early adoption for reporting periods prior to December 15, 2016 is not permitted. In March 2015, the FASB voted to defer the effective date by one year to fiscal years, and interim periods within those fiscal years beginning after December 15, 2017 (first quarter of fiscal year 2019 for the Company), but allow adoption as of the original adoption date. The Company has numerous different revenue sources including the sale and installation of fuel cell power plants, site engineering and construction services, sale of modules and spare parts, extended warranty service agreements, sale of electricity under power purchase agreements, license fees and royalty income from manufacturing and technology transfer agreements and customer-sponsored advanced technology projects. This requires application of various revenue recognition methods under current accounting guidance. Although we anticipate that, upon adoption of this new ASU the timing of revenue recognition for certain of our revenue sources might change, we are still evaluating the financial statement impacts of the guidance in this ASU and determining which transition method we will utilize. In May 2016, the FASB issued ASU 2016-12, “Revenue from Contracts with Customers (Topic 606).” This topic provides narrow-scope improvements and practical expedients regarding collectability, presentation of sales tax collected from customers, non-cash consideration, contract modifications at transition, completed contracts at transition and other technical corrections. We have initiated a review of the contracts for our significant revenue streams to understand the impact of the adoption of this ASU. |
Restructuring
Restructuring | 9 Months Ended |
Jul. 31, 2017 | |
Restructuring And Related Activities [Abstract] | |
Restructuring | Note 3. Restructuring On November 30, 2016, a business restructuring was announced to reduce costs and align production levels with current levels of demand in a manner that is consistent with the Company’s long-term strategic plan. The Company reduced materials spend as well as implemented various cost control initiatives. The workforce was reduced at both the North American production facility in Torrington, Connecticut, as well as at the corporate offices in Danbury, Connecticut and remote locations. A total of 96 positions, or approximately 17% of the Company’s global workforce, were eliminated. The production rate was reduced to twenty-five megawatts annually, from the prior rate of fifty megawatts annually, in order to position for delays in anticipated order flow. This production level is anticipated to be temporary and will be reevaluated as order flow dictates, with any future increases being undertaken from what is now a lower cost basis (refer to Note 1. Nature of Business and Basis of Presentation for further information on production rate reductions). Restructuring expense relating to eliminated positions of $1.4 million has been recorded for the nine months ended July 31, 2017, which has been presented on a separate caption in the Consolidated Statement of Operations. |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Jul. 31, 2017 | |
Receivables [Abstract] | |
Accounts Receivable | Note 4. Accounts Receivable Accounts receivable as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Commercial Revenue: Amount billed $ 3,494 $ 5,411 Unbilled recoverable costs (2) 11,590 13,651 15,084 19,062 Advanced Technology (including U.S. Government (1)): Amount billed 2,231 2,463 Unbilled recoverable costs 9,001 3,068 11,232 5,531 Accounts receivable, net $ 26,316 $ 24,593 (1) Total U.S. Government accounts receivable outstanding as of July 31, 2017 and October 31, 2016 were $3.7 million and $2.2 million, respectively. (2) Additional unbilled recoverable costs of $13.0 million and $5.7 million are included within “Other assets” as of July 31, 2017 and October 31, 2016, respectively. We bill customers for power plant sales based on certain contractual milestones being reached. We bill service agreements based on the contract price and billing terms of the contracts. Generally, our advanced technology contracts are billed based on actual recoverable costs incurred, typically in the month subsequent to incurring costs. Some advanced technology contracts are billed based on contractual milestones or costs incurred. Unbilled recoverable costs relate to revenue recognized on customer contracts that have not been billed. Accounts receivable are presented net of an allowance for doubtful accounts of $0.1 million and $0.2 million as of July 31, 2017 and October 31, 2016, respectively. Uncollectible accounts receivable are charged against the allowance for doubtful accounts when all collection efforts have failed and it is deemed unlikely that the amount will be recovered. Accounts receivable from commercial customers (including unbilled recoverable costs) included amounts due from POSCO of $2.0 million and $5.0 million as of July 31, 2017 and October 31, 2016, respectively and amounts due from NRG and NRG Yield of $0.02 million and $0.1 million as of July 31, 2017 and October 31, 2016, respectively. |
Inventories
Inventories | 9 Months Ended |
Jul. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Inventories | Note 5. Inventories The components of inventories as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Raw materials $ 22,525 $ 25,286 Work-in-process (1) 49,459 48,520 Inventories $ 71,984 $ 73,806 (1) Included in work-in-process as of July 31, 2017 and October 31, 2016 was $40.1 million and $40.6 million, respectively, of completed standard components. Raw materials consist mainly of various nickel powders and steels, various other components used in producing cell stacks and purchased components for balance of plant. Work-in-process inventory is comprised of material, labor, and overhead costs incurred to build balance of plant components, fuel cell stacks and modules, which are subcomponents of a power plant. Raw materials and work in process are net of a valuation allowance of approximately $0.2 million as of July 31, 2017 and October 31, 2016. |
Project Assets
Project Assets | 9 Months Ended |
Jul. 31, 2017 | |
Project Assets [Abstract] | |
Project Assets | Note 6. Project Assets Project assets as of July 31, 2017 and October 31, 2016 were $67.2 million and $47.1 million, respectively. Project assets as of July 31, 2017 include $31.4 million which represents four completed, commissioned installations where we have a PPA with the end-user of power and site host. These assets are the subject of sale-leaseback arrangements with PNC Energy Capital, LLC (“PNC”), which are recorded under the financing method of accounting for a sale-leaseback. Under the finance method, the Company does not recognize the proceeds received from the lessor as a sale of such assets. The Project assets balance also includes assets aggregating $32.4 million which are being constructed by the Company under PPAs which have been executed or are expected to be executed in fiscal year 2017. In November 2016, the Company’s wholly-owned subsidiary, FuelCell Energy Finance, LLC (“FuelCell Finance”) entered into a membership interest purchase agreement with GW Power LLC (“Seller”) whereby FuelCell Finance purchased all of the outstanding membership interests in New Britain Renewable Energy, LLC (“NBRE”) from Seller. Seller assigned the NBRE interest to FuelCell Finance free and clear of all liens other than a pledge in favor of Webster Bank, National Association. The Company adopted ASU 2017-01 which resulted in the transaction being accounted for as an asset acquisition of a power plant with a fair value of $2.3 million ($2.0 million as of July 31, 2017) which has been classified as a long-term project asset in support of an Energy Purchase Agreement. Project construction costs incurred for the long-term project assets are reported as investing activities in the Consolidated Statements of Cash Flows. The proceeds received from the sale and subsequent leaseback of project assets are classified as “Cash flows from financing activities” within the Consolidated Statements of Cash Flows and are classified as a financing obligation within “Current portion of long-term debt” and “Long-term debt and other liabilities” on the Consolidated Balance Sheets (refer to Note 14 for more information). |
Other Current Assets
Other Current Assets | 9 Months Ended |
Jul. 31, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Other Current Assets | Note 7. Other Current Assets Other current assets as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Advance payments to vendors (1) $ 800 $ 1,247 Deferred finance costs (2) 129 152 Notes receivable (3) — 1,007 Prepaid expenses and other (4) 5,082 7,775 Other current assets $ 6,011 $ 10,181 (1) Advance payments to vendors relate to payments for inventory purchases ahead of receipt. (2) Represents the current portion of direct deferred finance costs that relate primarily to securing a $40.0 million loan facility with NRG which is being amortized over the five-year life of the facility. (3) Notes receivable were included in the consideration paid for the acquired fuel cell power plant discussed in Note 6. (4) Primarily relates to other prepaid vendor expenses including insurance, rent and lease payments. |
Goodwill and Intangible Asset
Goodwill and Intangible Asset | 9 Months Ended |
Jul. 31, 2017 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Asset | Note 8. Goodwill and Intangible Asset As of July 31, 2017 and October 31, 2016, the Company had goodwill of $4.1 million and an intangible asset of $9.6 million associated with the December 2012 acquisition of Versa Power Systems. The intangible asset represents indefinite lived in-process research and development for cumulative research and development efforts associated with the development of solid oxide fuel cells (SOFC) stationary power generation. The Company completed its annual impairment analysis of goodwill and in-process research and development assets as of July 31, 2017. The Company performed a quantitative assessment in the prior year and determined that the estimated fair value of the reporting unit and in-process research and development intangible asset exceeded the respective carrying value and therefore no impairment was recognized as of July 31, 2016. The Company performed a qualitative assessment for the current year and determined that it was more likely than not that there was no impairment of goodwill or the indefinite lived intangible asset. |
Other Assets
Other Assets | 9 Months Ended |
Jul. 31, 2017 | |
Other Assets Noncurrent [Abstract] | |
Other Assets | Note 9. Other Assets Other assets as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Long-term accounts receivable (1) $ — $ 8,353 Long-term stack residual value (2) 657 — Deferred finance costs (3) 129 225 Long-term unbilled recoverable costs (4) 13,032 5,714 Other (5) 2,627 2,123 Other assets $ 16,445 $ 16,415 (1) The balance as of October 31, 2016 represents receivables, which were subsequently collected and relate to project and stack replacement reserve accounts for a sale-leaseback transaction. As of July 31, 2017, the funds were recorded as long-term restricted cash. (2) Relates to estimated residual value for module exchanges performed under the Company’s service agreements where the useful life extends beyond the contractual term of the service agreement and the Company obtains title for the module from the customer upon expiration or non-renewal of the service agreement. If the Company does not obtain rights to title from the customer, the full cost of the module is expensed at the time of the module exchange. The increase from October 31, 2016 represents residual value for two module replacements performed during the nine months ended July 31, 2017. (3) Represents the long-term portion of direct deferred finance costs relating to the Company’s loan facility with NRG which is being amortized over the five-year life of the facility. (4) Represents unbilled recoverable costs that relate to revenue recognized on customer contracts that will be billed in future periods in excess of twelve months from July 31, 2017. (5) The Company entered into an agreement with one of its customers on June 29, 2016 which includes a fee for the purchase of the plants at the end of the term of the agreement. The option fee is payable in installments over the term of the agreement and the total paid as of July 31, 2017 was $1.4 million. Also included within other are long-term security deposits. |
Accrued Liabilities
Accrued Liabilities | 9 Months Ended |
Jul. 31, 2017 | |
Accrued Liabilities Current [Abstract] | |
Accrued Liabilities | Note 10. Accrued Liabilities Accrued liabilities as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Accrued payroll and employee benefits $ 4,311 $ 4,183 Accrued contract loss 29 — Accrued product warranty cost (1) 226 516 Accrued material purchases (2) 3,199 6,908 Accrued service agreement costs (3) 3,076 6,030 Accrued taxes, legal, professional and other 2,281 3,263 Accrued liabilities $ 13,122 $ 20,900 (1) Activity in the accrued product warranty costs for the nine months ended July 31, 2017 included additions for estimates of future warranty obligations of $0.5 million on contracts in the warranty period and reductions related to actual warranty spend of $0.8 million as contracts progress through the warranty period or are beyond the warranty period. (2) The Company acts as a procurement agent for POSCO under an Integrated Global Supply Chain Agreement whereby the Company procures materials on POSCO’s behalf for its Asian production facility. This liability represents amounts received for the purchase of materials on behalf of POSCO. Amounts due to vendors is recorded as “Accounts payable.” (3) Activity in service agreement costs represents a decrease in loss accruals on service contracts of $1.8 million from $2.7 million as of October 31, 2016 to $0.9 million as of July 31, 2017. The decrease primarily relates to module exchanges performed during the nine months ended July 31, 2017. The accruals for performance guarantees also decreased from $3.3 million as of October 31, 2016 to $2.1 million as of July 31, 2017 resulting from guarantee payments to customers partially offset by additional accruals for the minimum output falling below the contract requirements for certain service agreements. |
Shareholders' Equity
Shareholders' Equity | 9 Months Ended |
Jul. 31, 2017 | |
Equity [Abstract] | |
Shareholders' Equity | Note 11. Shareholders’ Equity Changes in shareholders’ equity Changes in shareholders’ equity were as follows for the nine months ended July 31, 2017: Total Shareholders’ Equity Balance as of October 31, 2016 $ 114,396 Share-based compensation 3,432 Sale of common stock, net 12,427 Sale of common stock and warrants, public offering 13,888 Warrant exercises 1,782 Stock issued under benefit plans net of taxes paid upon vesting of restricted stock awards 51 Preferred dividends – Series B (2,400 ) Other comprehensive income - foreign currency translation adjustments 161 Net loss (43,924 ) Balance as of July 31, 2017 $ 99,813 Common Stock Sales The Company may sell common stock on the open market from time to time under an effective shelf registration statement. The proceeds of these sales is used for general corporate purposes or to pay obligations related to the outstanding Series 1 preferred shares of our subsidiary, FCE FuelCell Energy, Ltd., and the Company’s outstanding Series B preferred shares. During the nine months ended July 31, 2017, the Company sold 7.2 million shares of the Company’s common stock at prevailing market prices through periodic trades on the open market and raised approximately $12.4 million, net of fees. Public Offering and Outstanding Warrants On May 3, 2017, the Company completed an underwritten public offering of (i) 12,000,000 shares of its common stock, (ii) Series C warrants to purchase 12,000,000 shares of its common stock and (iii) Series D warrants to purchase 12,000,000 shares of its common stock, for gross proceeds of approximately $15.4 million, at a public offering price of $1.28 per share and accompanying warrants. Total net proceeds to the Company were approximately $13.9 million. The Series C warrants have an exercise price of $1.28 per share and a term of one year. The Series D warrants have an exercise price of $1.60 per share and a term of five years. A total of 1,377,540 shares of common stock were issued during the third quarter of fiscal year 2017 upon the exercise of Series D warrants and the Company received total proceeds of $1.8 million. On July 12, 2016, the Company closed on a registered public offering of securities to a single institutional investor pursuant to a placement agent agreement with J.P. Morgan Securities LLC. In conjunction with the offering the Company issued 7,680,000 Series A Warrants, all of which remained outstanding as of July 31, 2017, at an exercise price of $5.83 per share. The Company also issued 4,926,000 prefunded Series B Warrants. There were 3,826,000 prefunded Series B Warrants outstanding as of October 31, 2016, all of which were exercised during the nine months ended July 31, 2017. On July 30, 2014, the Company issued a warrant to NRG in conjunction with the entry into a Securities Purchase Agreement for the sale of common stock. Pursuant to the warrant agreement, NRG had the right to purchase up to 0.2 million shares of the Company’s common stock at an exercise price of $40.20 per share. The warrants expired on July 30, 2017. |
Loss Per Share
Loss Per Share | 9 Months Ended |
Jul. 31, 2017 | |
Earnings Per Share [Abstract] | |
Loss Per Share | Note 12. Loss Per Share The calculation of basic and diluted loss per share was as follows: Three Months Ended July 31, Nine Months Ended July 31, 2017 2016 2017 2016 Numerator Net loss $ (17,001 ) $ (11,067 ) $ (43,924 ) $ (38,260 ) Net loss attributable to noncontrolling interest — 57 — 165 Preferred stock dividend (800 ) (800 ) (2,400 ) (2,400 ) Net loss attributable to common shareholders $ (17,801 ) $ (11,810 ) $ (46,324 ) $ (40,495 ) Denominator Weighted average basic common shares 57,420,050 31,015,658 45,903,033 28,680,596 Effect of dilutive securities (1) — — — — Weighted average diluted common shares 57,420,050 31,015,658 45,903,033 28,680,596 Basic loss per share $ (0.31 ) $ (0.38 ) $ (1.01 ) $ (1.41 ) Diluted loss per share (1) $ (0.31 ) $ (0.38 ) $ (1.01 ) $ (1.41 ) (1) Due to the net loss to common shareholders in each of the periods presented above, diluted loss per share was computed without consideration to potentially dilutive instruments as their inclusion would have been antidilutive. As of July 31, 2017 and 2016, potentially dilutive securities excluded from the diluted loss per share calculation are as follows: July 31, July 31, 2017 2016 May 2017 Offering - Series C Warrants 12,000,000 — May 2017 Offering - Series D Warrants 10,622,460 — July 2016 Offering - Series A Warrants 7,680,000 7,680,000 July 2016 Offering - Series B Warrants — 4,926,000 July 2014 Offering - NRG Warrant — 166,666 Outstanding options to purchase common stock 316,330 247,776 Unvested Restricted Stock Awards 2,004,330 910,079 5% Series B Cumulative Convertible Preferred Stock 454,043 454,043 Series 1 Preferred Shares to satisfy conversion requirements 15,166 15,166 Total potentially dilutive securities 33,092,329 14,399,730 Refer to Note 12, Redeemable Preferred Stock, which is included in our Annual Report on Form 10-K for the year ended October 31, 2016, for information on the calculation of the common shares upon conversion. |
Restricted Cash
Restricted Cash | 9 Months Ended |
Jul. 31, 2017 | |
Restricted Cash And Investments [Abstract] | |
Restricted Cash | Note 13. Restricted Cash As of July 31, 2017, there was $38.1 million of restricted cash and cash equivalents pledged as collateral for letters of credit for certain banking requirements and contractual commitments, compared to $34.1 million of restricted cash and cash equivalents pledged as of October 31, 2016. The restricted cash balance for both periods presented includes $15.0 million which has been placed in a Grantor’s Trust account to secure certain obligations under a 15-year service agreement and has been classified as long-term. The restricted cash balance as of July 31, 2017 also includes $17.0 million to support obligations related to PNC sale-leaseback transactions. As of July 31, 2017 and October 31, 2016, outstanding letters of credit totaled $2.9 million and $7.9 million, respectively. These expire on various dates through April 2019. |
Debt and Finance Obligation
Debt and Finance Obligation | 9 Months Ended |
Jul. 31, 2017 | |
Debt [Abstract] | |
Debt and Finance Obligation | Note 14. Debt and Finance Obligation Debt as of July 31, 2017 and October 31, 2016, consisted of the following: July 31, October 31, 2017 2016 Connecticut Development Authority Note $ 2,410 $ 2,589 CT Green Bank Note 6,052 6,050 NRG Energy, Inc. Loan Agreement — 1,755 PNC Energy Capital, LLC Finance Obligation 46,980 41,603 State of Connecticut Loan 10,000 10,000 Hercules Loan and Security Agreement 21,229 20,521 New Britain Renewable Energy Term Loan 1,845 — Capitalized lease obligations 738 660 Deferred finance costs (1,415 ) (1,408 ) Total debt $ 87,839 $ 81,770 Current portion of long-term debt and finance obligation (21,738 ) (5,010 ) Long-term debt $ 66,101 $ 76,760 The Company has a loan agreement with the Connecticut Development Authority to finance equipment purchases associated with manufacturing capacity expansion allowing for a maximum amount borrowed of $4.0 million. The interest rate is 5.0 percent and the loan is collateralized by the assets procured under this loan as well as $4.0 million of additional machinery and equipment. Repayment terms require monthly interest and principal payments through May 2018. The Company has a long-term loan agreement with the CT Green Bank totaling $5.9 million in support of the Bridgeport Fuel Cell Park project. The loan agreement carries an interest rate of 5.0 percent. Interest only payments commenced in January 2014 and principal payments will commence on the eighth anniversary of the project’s provisional acceptance date, which is December 20, 2021, payable in forty-eight equal monthly installments. Outstanding amounts are secured by future cash flows from the Bridgeport Fuel Cell Park service agreement. In July 2014, the Company, through its wholly-owned subsidiary, FuelCell Finance, entered into a Loan Agreement (the “Loan Agreement”) with NRG. Pursuant to the Loan Agreement, NRG has extended a $40.0 million revolving construction and term financing facility for the purpose of accelerating project development by the Company and its subsidiaries. We may draw on the facility to finance the construction of projects through the commercial operating date of the power plants. The interest rate is 8.5 percent per annum for construction-period financing and 8.0 percent thereafter. Fees that were paid by FuelCell Finance to NRG for making the loan facility available and related legal fees incurred were capitalized and are being amortized straight-line over the life of the related loan agreement, which is five years. The term of the loans are up to five years but may be repaid early should the projects be sold or refinanced at the option of the Company. In 2015, the Company entered into an agreement with PNC, whereby the Company’s project finance subsidiaries may enter into sale-leaseback agreements for commissioned projects where we have entered into a PPA with the site host/end-user of produced power. Under the financing method of accounting for a sale-leaseback, the Company does not recognize as income any of the sale proceeds received from the lessor that contractually constitute payment to acquire the assets subject to these arrangements. Instead, the sale proceeds received are accounted for as financing obligations. The outstanding finance obligation balance as of July 31, 2017 was $47.0 million and the increase from October 31, 2016 includes a sale-leaseback transaction which was completed in December 2016 and the recognition of interest expense offset by lease payments. In November 2015, the Company closed on a definitive Assistance Agreement with the State of Connecticut and received a disbursement of $10.0 million for the first phase of the expansion project to expand the existing 65,000 square foot manufacturing facility in Torrington, Connecticut by approximately 102,000 square feet for a total size of 167,000 square feet. In conjunction with this financing, the Company entered into a $10.0 million Promissory Note and related security agreement securing the loan with equipment liens and a mortgage on its Danbury, Connecticut location. Pursuant to the terms of the loan, payment of principal is deferred for the first four years. Interest at a fixed rate of 2.0 percent is payable beginning in December 2015. The financing is payable over 15 years, and is predicated on certain terms and conditions, including the forgiveness of up to half of the loan principal if certain job retention and job creation targets are reached. On April 17, 2017, the Company entered into an amendment to the Assistance Agreement extending certain of the job creation target dates. In April 2016, the Company entered into a loan and security agreement with Hercules Capital, Inc. (“Hercules”) for an aggregate principal amount of up to $25.0 million, subject to certain terms and conditions. The Company drew down $20.0 million during fiscal year 2016. The loan is a 30 month secured facility and the term loan interest was previously 9.5 percent and increased to 9.75 percent resulting from the increase in the prime rate. Interest is paid on a monthly basis. Interest only payments were to be made for the first 18 months as a result of the Company achieving certain milestones. In addition to interest, principal payments are to commence on November 1, 2017 in equal monthly installments. The loan balance and all accrued and unpaid interest is due and payable by October 1, 2018. Per the terms of the loan and security agreement, there is an end of term charge of $1.7 million which is being accreted over the 30 month term using the effective interest rate method. As collateral for obligations under the loan and security agreement, the Company granted Hercules a security interest in FuelCell Energy, Inc.’s existing and hereafter-acquired assets except for intellectual property and certain other excluded assets. Collateral does not include assets held by FuelCell Finance or any project subsidiary thereof. The Company may continue to collateralize and finance its project subsidiaries through other lenders and partners. The loan contains a financial covenant whereby the Company is required to maintain an unrestricted cash balance of at least (a) 75% of the outstanding Loan balance plus (b) the amount of accounts payable (as defined under GAAP) not paid within 90 days of the date payment was issued. In November 2016, in connection with the acquisition of NBRE, debt with Webster Bank was assumed as a part of the transaction in the amount of $2.3 million. The term loan interest rate is 5.0 percent and payments are due on a quarterly basis commencing in January 2017. The balance outstanding as of July 31, 2017 was $1.8 million. The Company leases computer equipment under master lease agreements. Lease payment terms are generally thirty-six months from the date of acceptance for leased equipment. Direct deferred finance costs relate primarily to sale-leaseback transactions entered into with PNC which are being amortized over the ten-year term and direct deferred finance costs relating to the Hercules loan and security agreement entered into in April 2016 which is being amortized over the 30 month life of the loan. |
Benefit Plans
Benefit Plans | 9 Months Ended |
Jul. 31, 2017 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Benefit Plans | Note 15. Benefit Plans The Company has 2006 and 2010 Equity Incentive Plans (collectively, the “Equity Plans”). In April 2017, the number of shares of common stock reserved for issuance under the 2010 Equity Incentive Plan was increased to 4.5 million shares. As of July 31, 2017 there were 0.2 million shares available for grant under the 2010 Equity Incentive Plan. As of July 31, 2017, equity awards outstanding consisted of incentive stock options, nonstatutory stock options, restricted stock awards (“RSAs”) and restricted stock units (“RSUs”). Restricted Stock Awards and Units RSAs and RSUs granted during the nine months ended July 31, 2017 totaled 2.6 million. RSA and RSU expense is based on the fair value of the award at the date of grant and is amortized over the vesting period which is either over 3 or 4 years. As of July 31, 2017, there were 3.1 million total RSAs and RSUs outstanding. Stock Awards During the nine months ended July 31, 2017, the Company awarded 86,000 shares of fully vested, unrestricted common stock to the independent members of its board of directors as a component of board of director compensation which resulted in recognition of $0.1 million of expense. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jul. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 16. Commitments and Contingencies Lease Agreements As of July 31, 2017 and October 31, 2016, the Company had equipment financing and capital lease obligations of $0.7 million. Payment terms are generally thirty-six months from the date of acceptance for leased equipment. The Company also leases certain computer and office equipment and manufacturing facilities in Torrington and Danbury, Connecticut under operating leases expiring on various dates through 2030. Non-cancelable minimum payments applicable to operating and capital leases as of July 31, 2017 were as follows (in thousands): Operating Leases Capital Leases Due Year 1 $ 1,324 $ 384 Due Year 2 966 244 Due Year 3 497 90 Due Year 4 350 15 Due Year 5 374 5 Thereafter 3,471 — Total $ 6,982 $ 738 Service Agreements Under the provisions of our service agreements, we provide services to maintain, monitor, and repair customer power plants to meet minimum operating levels. Under the terms of our service agreements, the power plant must meet a minimum operating output during the term. If minimum output falls below the contract requirement, we may be subject to performance penalties and/or may be required to repair or replace the customer’s fuel cell module. An estimate is not recorded for a potential performance guarantee liability until a performance issue has occurred at a particular power plant. At that point, the actual power plant’s output is compared against the minimum output guarantee and an accrual is recorded. The review of power plant performance is updated for each reporting period to incorporate the most recent performance of the power plant and minimum output guarantee payments made to customers, if any. The Company has provided for an accrual for performance guarantees, based on actual fleet performance, which totaled $2.1 million and $3.3 million as of July 31, 2017 and October 31, 2016, respectively, and is recorded in “Accrued liabilities.” Our loss accrual on service agreements, excluding the accrual for performance guarantees, totaled $0.9 million and $2.7 million as of July 31, 2017 and October 31, 2016, respectively, and is recorded in “Accrued liabilities.” Our accrual estimates are performed on a contract by contract basis and include cost assumptions based on what we anticipate the service requirements will be to fulfill obligations under each contract. The decrease primarily relates to module exchanges performed during the nine months ended July 31, 2017. Power Purchase Agreements Under the terms of our PPAs, customers agree to purchase power from our fuel cell power plants at negotiated rates. Electricity rates are generally a function of the customers’ current and future electricity pricing available from the grid. As lessee of the power plants, we are responsible for all operating costs necessary to maintain, monitor and repair the power plants. Under certain agreements, we are also responsible for procuring fuel, generally natural gas, to run the power plants. Expansion of Torrington Facility and Related Financing In December 2015, the Company commenced the first phase of its project to expand the existing 65,000 square foot manufacturing facility in Torrington, Connecticut by approximately 102,000 square feet for a total size of 167,000 square feet. Initially, this additional space will be used to enhance and streamline logistics functions through consolidation of satellite warehouse locations and will provide the space needed to reconfigure the existing production process to improve manufacturing efficiencies. On November 9, 2015, the Company closed on a definitive Assistance Agreement with the State of Connecticut and received a disbursement of $10.0 million to be used for the first phase of the expansion project. In conjunction with this financing, the Company entered into a $10.0 million Promissory Note and related security agreements. The second phase of our manufacturing expansion, for which we will be eligible, subject to certain conditions to receive an additional $10.0 million in low-cost financing from the State of Connecticut, will commence as demand supports. Other As of July 31, 2017, the Company had unconditional purchase commitments aggregating $26.4 million, for materials, supplies and services in the normal course of business. Under certain sales and financing agreements, the Company is contractually committed to provide compensation for any losses that its customers and finance partners may suffer in certain limited circumstances resulting from reductions in the U.S. Investment Tax Credit. Such obligations would arise as a result of reductions to the value of the underlying fuel cell projects as assessed by the U.S. Internal Revenue Service (IRS). The Company does not believe that any payments under these contracts are probable based on the facts known at the reporting date. The maximum potential future payments that the Company could have to make under these obligations would depend on the difference between the fair values of the fuel cell projects sold or financed and the values the IRS would determine as the fair value for the systems for purposes of claiming the Investment Tax Credit. The value of the Investment Tax Credit in the Company’s agreements is based on guidelines provided by the statutory regulations from the IRS. The Company and its customers use fair values determined with the assistance of independent third-party appraisals. We are involved in legal proceedings, claims and litigation arising out of the ordinary conduct of our business. Although we cannot assure the outcome, management presently believes that the result of such legal proceedings, either individually, or in the aggregate, will not have a material adverse effect on our consolidated financial statements, and no material amounts have been accrued in our consolidated financial statements with respect to these matters. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jul. 31, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 17. Subsequent Events 20 Megawatt Order in South Korea On August 29, 2017, we entered into a contract to sell 20 megawatts of fuel cell power plants to Hanyang Industrial Development Company Ltd. (HYD), for installation at South Korean utility Korea Southern Power Company Ltd. (KOSPO). We expect that this project will represent in excess of $60 million of product revenue and any product not shipped by the end of the fourth fiscal quarter of 2017 will be added to backlog. Revenue for the fourth quarter of 2017 is expected to increase compared to the third quarter of 2017, as revenue begins to be recognized on this contract. Product revenue recognition will carry into fiscal year 2018. Convertible Preferred Offering On September 5, 2017, the Company priced an underwritten offering of 33,500 shares of convertible preferred stock (the “Series C Preferred”). The Series C Preferred carries a 0.0% dividend and a $1.84 conversion price. Each share of Series C Preferred is being sold at a price of $895.52 for gross proceeds of approximately $30 million. FuelCell Energy intends to use the net proceeds from this offering for working capital, project financing, and general corporate purposes. The offering closed on September 8, 2017. In connection with the convertible preferred offering, we have agreed with Hercules to amend the loan and security agreement (1) to permit us to make certain cash payments that may be required pursuant to the terms of the Series C Preferred Shares, (2) to require us to maintain an unrestricted blocked cash balance of at least the greater of (x) (a) $20.0 million plus (b) the amount of accounts payable not paid within 90 days of the date payment was issued and (y) (a) 100% of the outstanding loan balance plus (b) the amount of accounts payable not paid within 90 days of the date payment was issued and (3) to add an event of default in the event of the delivery of a notice by the holders to redeem the Series C Preferred Shares following a triggering event pursuant to the certificate of designations governing the Series C Preferred Shares. Proxy Ratification Vote On September 5, 2017, we filed a definitive proxy statement with the SEC which provides notice to our shareholders of a special meeting of shareholders to be held on Friday, September 29, 2017 to ratify the filing and effectiveness of the certificate of amendment to our amended and restated certificate of incorporation filed with the Secretary of State of the State of Delaware on December 3, 2015 and the 1-for-12 reverse stock split of our common stock that was effected thereby and became effective on December 3, 2015. 1 |
Nature of Business and Basis 25
Nature of Business and Basis of Presentation (Policies) | 9 Months Ended |
Jul. 31, 2017 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”) regarding interim financial information. Accordingly, they do not contain all of the information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. In the opinion of management, all normal and recurring adjustments necessary to fairly present our financial position and results of operations as of and for the three and nine months ended July 31, 2017 have been included. All intercompany accounts and transactions have been eliminated. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principles generally accepted in the United States of America have been condensed or omitted. The balance sheet as of October 31, 2016 has been derived from the audited financial statements at that date, but it does not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. These financial statements should be read in conjunction with our financial statements and notes thereto for the year ended October 31, 2016, which are contained in our Annual Report on Form 10-K previously filed with the SEC. The results of operations for the interim periods presented are not necessarily indicative of results that may be expected for any other interim period or for the full fiscal year. Certain reclassifications have been made to conform to the current year presentation. The Company has adopted Accounting Standards Update (“ASU”) 2015-03, Interest – Imputation of Interest effective January 31, 2017, and retrospective application is required which resulted in a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $0.3 million of debt issuance costs from Current assets to be a direct deduction from Current portion of long-term debt and a reclassification in our Consolidated Balance Sheet as of October 31, 2016 of $1.1 million of debt issuance costs from Other assets, net to be a direct deduction from Long-term debt and other liabilities. The Company has also early adopted ASU 2016-18, “Statement of Cash Flows (Topic 230) Restricted Cash” effective October 31, 2016 and has applied a retrospective transition method. Accordingly, Restricted cash and cash equivalents has been reclassified as a component of “Cash, cash equivalents, and restricted cash” in the Consolidated Statement of Cash Flows for nine months ended July 31, 2016. The Company has also included an additional line item, “Generation,” in the “Revenues” and “Cost of revenues” sections of the Statements of Operations to include revenues generated from the Company’s project assets (refer to the Revenue Recognition section below for more information). The prior year amounts associated with power purchase agreements have been reclassified to the new “Generation” line item. |
Revenue Recognition | Revenue Recognition We earn revenue from (i) the sale and installation of fuel cell power plants (ii) the sale of component part kits, modules and spare parts to customers, (iii) site engineering and construction services, (iv) performance under long-term service agreements, (v) the sale of electricity and other value streams under power purchase agreements (“PPAs”) and project assets retained by the Company under sales-leaseback transactions, (vi) license fees and royalty income from manufacturing and technology transfer agreements, and (vii) government and customer-sponsored advanced technology projects. Given the growing revenue related to PPAs and project assets retained by the Company, beginning in the first quarter of 2017, the Company began classifying such revenues in a separate line item called Generation, and prior period amounts have been reclassified. As further clarification, revenue elements are classified as follows: Product. Includes the sale and installation of fuel cell power plants, the sale of component part kits, modules and spare parts to customers, and site engineering and construction services. Service and license. Includes performance under long-term service agreements for power plants owned by third parties and license fees and royalty income from manufacturing and technology transfer agreements. Generation. Includes the sale of electricity under PPAs and project assets retained by the Company, and revenue received from the sale of other value streams from these assets including the sale of heat, steam and renewable energy credits. Advanced technologies. Includes revenue from customer-sponsored and government-sponsored advanced technology projects that is recorded as “Advanced technologies” revenues in the Consolidated Statements of Operations. Our revenue is primarily generated from customers located throughout the U.S., Europe and Asia and from agencies of the U.S. Government. For customer contracts for complete SureSource power plants, with which the Company has adequate cost history and estimating experience, and with respect to which management believes it can reasonably estimate total contract costs, revenue is recognized under the percentage of completion method of accounting. The use of percentage of completion accounting requires significant judgment relative to estimating total contract costs, including assumptions relative to the length of time to complete the contract, the nature and complexity of the work to be performed, anticipated increases in wages and prices for subcontractor services and materials, and the availability of subcontractor services and materials. Our estimates are based upon the professional knowledge and experience of our engineers, project managers and other personnel, who review each long-term contract on a quarterly basis to assess the contract’s schedule, performance, technical matters and estimated cost at completion. When changes in estimated contract costs are identified, such revisions may result in current period adjustments to operations applicable to performance in prior periods. Revenues are recognized based on the percentage of the contract value that incurred costs to date bear to estimated total contract costs, after giving effect to estimates of costs to complete based on most recent information. For customer contracts for new or significantly customized products, where management does not believe it has the ability to reasonably estimate total contract costs, revenue is recognized using the completed contract method and therefore all revenue and costs for the contract are deferred and not recognized until installation and acceptance of the power plant is complete. We recognize anticipated contract losses as soon as they become known and estimable. Actual results could vary from initial estimates and estimates will be updated as conditions change. Site engineering and construction services revenue is recognized on a percentage of completion basis as costs are incurred. Revenue from fuel cell kits, modules and spare parts sales is recognized upon shipment or title transfer under the terms of the customer contract. Terms for certain contracts provide for a transfer of title and risk of loss to our customers at our factory locations upon completion of our contractual requirement to produce products and prepare the products for shipment. A shipment in place may occur in the event that the customer is not ready to take delivery of the products on the contractually specified delivery dates. Revenue from service agreements is generally recorded ratably over the term of the service agreement, as our performance of routine monitoring and maintenance under these service agreements is generally expected to be incurred on a straight-line basis. For service agreements where we expect to have a module exchange at some point during the term (generally service agreements in excess of five years), the costs of performance are not expected to be incurred on a straight-line basis, and therefore, a portion of the initial contract value related to the module exchange is deferred and is recognized upon such module replacement event. The Company receives license fees and royalty income from POSCO Energy (“POSCO”) as a result of manufacturing and technology transfer agreements entered into in 2007, 2009 and 2012. The Cell Technology Transfer Agreement we entered into on October 31, 2012 provides POSCO with a technology license to manufacture SureSource power plants in South Korea. On March 17, 2017, the Company entered into a Memorandum of Understanding (“2017 MOU”) with POSCO to engage in discussions to further amend the above referenced agreements and other agreements between the parties, as well as engaging in discussions relating to entering into new agreements to further the parties mutual interests. The 2017 MOU contemplates that POSCO will continue to service the existing installed base of fuel cell plants in South Korea. In addition, the 2017 MOU contemplates entering into a module procurement agreement with POSCO that the Company anticipates will provide that POSCO will commit to a specified level of module purchases from the Company to supplement its own local manufacturing for servicing its existing fleet. Definitive agreements are expected to be finalized in 2017 subject to completion of due diligence, regulatory approvals, and customary closing conditions. Pursuant to the 2017 MOU, the Company commenced marketing the entire suite of SureSource solutions in South Korea as well as the broader Asian markets for the supply, recovery and storage of energy. Under PPAs and project assets retained by the Company, revenue from the sale of electricity and other value streams is recognized as electricity is provided to the customer. These revenues are classified as a component of generation revenues. Advanced technologies contracts include both private industry and government entities. Revenue from most government sponsored advanced technology projects is recognized as direct costs are incurred plus allowable overhead less cost share requirements, if any. Revenue from fixed price advanced technology projects is recognized using percentage of completion accounting. Advanced technology programs are often multi-year projects or structured in phases with subsequent phases dependent on reaching certain milestones prior to additional funding being authorized. Government contracts are typically structured with cost-reimbursement and/or cost-shared type contracts or cooperative agreements. We are reimbursed for reasonable and allocable costs up to the reimbursement limits set by the contract or cooperative agreement, and on certain contracts we are reimbursed only a portion of the costs incurred. |
Use of Estimates | Use of Estimates The preparation of financial statements and related disclosures in conformity with accounting principles generally accepted in the U.S. requires management to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and the disclosure of contingent assets and liabilities. Estimates are used in accounting for, among other things, revenue recognition, excess, slow-moving and obsolete inventories, product warranty costs, accruals for service agreements, allowance for uncollectible receivables, depreciation and amortization, impairment of goodwill, indefinite-lived intangible assets and long-lived assets, income taxes, and contingencies. Estimates and assumptions are reviewed periodically, and the effects of revisions are reflected in the consolidated financial statements in the period they are determined to be necessary. Due to the inherent uncertainty involved in making estimates, actual results in future periods may differ from those estimates. |
Related Parties | Related Parties POSCO is a related party and owned approximately 4.0% of the outstanding common shares of the Company as of July 31, 2017. Revenues from POSCO for the three months ended July 31, 2017 and 2016 represent 13% and 65%, respectively, of consolidated revenues and revenues from POSCO for the nine months ended July 31, 2017 and 2016 represent 9% and 52%, respectively, of consolidated revenues. NRG Energy, Inc. (“NRG”) is a related party and owned approximately 2.0% of the outstanding common shares of the Company as of July 31, 2017. NRG Yield is a dividend growth-oriented company formed by NRG that owns, operates and acquires a diversified portfolio of contracted renewable and conventional generation and thermal infrastructure assets in the United States. Revenues from NRG and NRG Yield for the three months ended July 31, 2017 and 2016 represent 0.6% and 0.3%, respectively, of consolidated revenues and revenues form NRG and NRG Yield for the nine months ended July 31, 2017 and 2016 represent 0.4% and 0.2%, respectively, of consolidated revenues. |
Recent Developments | Recent Developments Production Rate Adjustment : In June 2017, the Company reduced its production to approximately fifteen megawatts on an annualized basis. This adjustment was made to manage inventory levels, prepare to transition to new product introductions and complete certain building expansion activities. From June through September 2017 approximately 110 manufacturing employees will work shortened work weeks. The Company is participating in the State of Connecticut’s “Shared Work Program” allowing affected employees to collect unemployment benefits for days they do not work. This production level is anticipated to be temporary and will be reevaluated as order flow dictates. |
Accounts Receivable | Accounts Receivable We bill customers for power plant sales based on certain contractual milestones being reached. We bill service agreements based on the contract price and billing terms of the contracts. Generally, our advanced technology contracts are billed based on actual recoverable costs incurred, typically in the month subsequent to incurring costs. Some advanced technology contracts are billed based on contractual milestones or costs incurred. Unbilled recoverable costs relate to revenue recognized on customer contracts that have not been billed. Accounts receivable are presented net of an allowance for doubtful accounts of $0.1 million and $0.2 million as of July 31, 2017 and October 31, 2016, respectively. Uncollectible accounts receivable are charged against the allowance for doubtful accounts when all collection efforts have failed and it is deemed unlikely that the amount will be recovered. |
Inventories | Inventories Raw materials consist mainly of various nickel powders and steels, various other components used in producing cell stacks and purchased components for balance of plant. Work-in-process inventory is comprised of material, labor, and overhead costs incurred to build balance of plant components, fuel cell stacks and modules, which are subcomponents of a power plant. |
Goodwill and Intangible Asset | Goodwill and Intangible Asset The Company completed its annual impairment analysis of goodwill and in-process research and development assets as of July 31, 2017. The Company performed a quantitative assessment in the prior year and determined that the estimated fair value of the reporting unit and in-process research and development intangible asset exceeded the respective carrying value and therefore no impairment was recognized as of July 31, 2016. The Company performed a qualitative assessment for the current year and determined that it was more likely than not that there was no impairment of goodwill or the indefinite lived intangible asset. |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Receivables [Abstract] | |
Schedule of Accounts Receivable | Accounts receivable as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Commercial Revenue: Amount billed $ 3,494 $ 5,411 Unbilled recoverable costs (2) 11,590 13,651 15,084 19,062 Advanced Technology (including U.S. Government (1)): Amount billed 2,231 2,463 Unbilled recoverable costs 9,001 3,068 11,232 5,531 Accounts receivable, net $ 26,316 $ 24,593 (1) Total U.S. Government accounts receivable outstanding as of July 31, 2017 and October 31, 2016 were $3.7 million and $2.2 million, respectively. (2) Additional unbilled recoverable costs of $13.0 million and $5.7 million are included within “Other assets” as of July 31, 2017 and October 31, 2016, respectively. |
Inventories (Tables)
Inventories (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Inventory Disclosure [Abstract] | |
Components of Inventories | The components of inventories as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Raw materials $ 22,525 $ 25,286 Work-in-process (1) 49,459 48,520 Inventories $ 71,984 $ 73,806 (1) Included in work-in-process as of July 31, 2017 and October 31, 2016 was $40.1 million and $40.6 million, respectively, of completed standard components. |
Other Current Assets (Tables)
Other Current Assets (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |
Other Current Assets | Other current assets as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Advance payments to vendors (1) $ 800 $ 1,247 Deferred finance costs (2) 129 152 Notes receivable (3) — 1,007 Prepaid expenses and other (4) 5,082 7,775 Other current assets $ 6,011 $ 10,181 (1) Advance payments to vendors relate to payments for inventory purchases ahead of receipt. (2) Represents the current portion of direct deferred finance costs that relate primarily to securing a $40.0 million loan facility with NRG which is being amortized over the five-year life of the facility. (3) Notes receivable were included in the consideration paid for the acquired fuel cell power plant discussed in Note 6. (4) Primarily relates to other prepaid vendor expenses including insurance, rent and lease payments. |
Other Assets (Tables)
Other Assets (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Other Assets Noncurrent [Abstract] | |
Schedule of Other Assets | Other assets as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Long-term accounts receivable (1) $ — $ 8,353 Long-term stack residual value (2) 657 — Deferred finance costs (3) 129 225 Long-term unbilled recoverable costs (4) 13,032 5,714 Other (5) 2,627 2,123 Other assets $ 16,445 $ 16,415 (1) The balance as of October 31, 2016 represents receivables, which were subsequently collected and relate to project and stack replacement reserve accounts for a sale-leaseback transaction. As of July 31, 2017, the funds were recorded as long-term restricted cash. (2) Relates to estimated residual value for module exchanges performed under the Company’s service agreements where the useful life extends beyond the contractual term of the service agreement and the Company obtains title for the module from the customer upon expiration or non-renewal of the service agreement. If the Company does not obtain rights to title from the customer, the full cost of the module is expensed at the time of the module exchange. The increase from October 31, 2016 represents residual value for two module replacements performed during the nine months ended July 31, 2017. (3) Represents the long-term portion of direct deferred finance costs relating to the Company’s loan facility with NRG which is being amortized over the five-year life of the facility. (4) Represents unbilled recoverable costs that relate to revenue recognized on customer contracts that will be billed in future periods in excess of twelve months from July 31, 2017. (5) The Company entered into an agreement with one of its customers on June 29, 2016 which includes a fee for the purchase of the plants at the end of the term of the agreement. The option fee is payable in installments over the term of the agreement and the total paid as of July 31, 2017 was $1.4 million. Also included within other are long-term security deposits. |
Accrued Liabilities (Tables)
Accrued Liabilities (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Accrued Liabilities Current [Abstract] | |
Schedule of Accrued Liabilities | Accrued liabilities as of July 31, 2017 and October 31, 2016 consisted of the following: July 31, October 31, 2017 2016 Accrued payroll and employee benefits $ 4,311 $ 4,183 Accrued contract loss 29 — Accrued product warranty cost (1) 226 516 Accrued material purchases (2) 3,199 6,908 Accrued service agreement costs (3) 3,076 6,030 Accrued taxes, legal, professional and other 2,281 3,263 Accrued liabilities $ 13,122 $ 20,900 (1) Activity in the accrued product warranty costs for the nine months ended July 31, 2017 included additions for estimates of future warranty obligations of $0.5 million on contracts in the warranty period and reductions related to actual warranty spend of $0.8 million as contracts progress through the warranty period or are beyond the warranty period. (2) The Company acts as a procurement agent for POSCO under an Integrated Global Supply Chain Agreement whereby the Company procures materials on POSCO’s behalf for its Asian production facility. This liability represents amounts received for the purchase of materials on behalf of POSCO. Amounts due to vendors is recorded as “Accounts payable.” (3) Activity in service agreement costs represents a decrease in loss accruals on service contracts of $1.8 million from $2.7 million as of October 31, 2016 to $0.9 million as of July 31, 2017. The decrease primarily relates to module exchanges performed during the nine months ended July 31, 2017. The accruals for performance guarantees also decreased from $3.3 million as of October 31, 2016 to $2.1 million as of July 31, 2017 resulting from guarantee payments to customers partially offset by additional accruals for the minimum output falling below the contract requirements for certain service agreements. |
Shareholders' Equity (Tables)
Shareholders' Equity (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Equity [Abstract] | |
Schedule of Stockholders Equity | Changes in shareholders’ equity were as follows for the nine months ended July 31, 2017: Total Shareholders’ Equity Balance as of October 31, 2016 $ 114,396 Share-based compensation 3,432 Sale of common stock, net 12,427 Sale of common stock and warrants, public offering 13,888 Warrant exercises 1,782 Stock issued under benefit plans net of taxes paid upon vesting of restricted stock awards 51 Preferred dividends – Series B (2,400 ) Other comprehensive income - foreign currency translation adjustments 161 Net loss (43,924 ) Balance as of July 31, 2017 $ 99,813 |
Loss Per Share (Tables)
Loss Per Share (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Earnings Per Share [Abstract] | |
Calculation of Basic and Diluted Loss Per Share | The calculation of basic and diluted loss per share was as follows: Three Months Ended July 31, Nine Months Ended July 31, 2017 2016 2017 2016 Numerator Net loss $ (17,001 ) $ (11,067 ) $ (43,924 ) $ (38,260 ) Net loss attributable to noncontrolling interest — 57 — 165 Preferred stock dividend (800 ) (800 ) (2,400 ) (2,400 ) Net loss attributable to common shareholders $ (17,801 ) $ (11,810 ) $ (46,324 ) $ (40,495 ) Denominator Weighted average basic common shares 57,420,050 31,015,658 45,903,033 28,680,596 Effect of dilutive securities (1) — — — — Weighted average diluted common shares 57,420,050 31,015,658 45,903,033 28,680,596 Basic loss per share $ (0.31 ) $ (0.38 ) $ (1.01 ) $ (1.41 ) Diluted loss per share (1) $ (0.31 ) $ (0.38 ) $ (1.01 ) $ (1.41 ) (1) Due to the net loss to common shareholders in each of the periods presented above, diluted loss per share was computed without consideration to potentially dilutive instruments as their inclusion would have been antidilutive. As of July 31, 2017 and 2016, potentially dilutive securities excluded from the diluted loss per share calculation are as follows: |
Schedule of Potentially Dilutive Securities Excluded from the Diluted Loss Per Share Calculation | As of July 31, 2017 and 2016, potentially dilutive securities excluded from the diluted loss per share calculation are as follows: July 31, July 31, 2017 2016 May 2017 Offering - Series C Warrants 12,000,000 — May 2017 Offering - Series D Warrants 10,622,460 — July 2016 Offering - Series A Warrants 7,680,000 7,680,000 July 2016 Offering - Series B Warrants — 4,926,000 July 2014 Offering - NRG Warrant — 166,666 Outstanding options to purchase common stock 316,330 247,776 Unvested Restricted Stock Awards 2,004,330 910,079 5% Series B Cumulative Convertible Preferred Stock 454,043 454,043 Series 1 Preferred Shares to satisfy conversion requirements 15,166 15,166 Total potentially dilutive securities 33,092,329 14,399,730 |
Debt and Finance Obligation (Ta
Debt and Finance Obligation (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Debt [Abstract] | |
Schedule of Debt | Debt as of July 31, 2017 and October 31, 2016, consisted of the following: July 31, October 31, 2017 2016 Connecticut Development Authority Note $ 2,410 $ 2,589 CT Green Bank Note 6,052 6,050 NRG Energy, Inc. Loan Agreement — 1,755 PNC Energy Capital, LLC Finance Obligation 46,980 41,603 State of Connecticut Loan 10,000 10,000 Hercules Loan and Security Agreement 21,229 20,521 New Britain Renewable Energy Term Loan 1,845 — Capitalized lease obligations 738 660 Deferred finance costs (1,415 ) (1,408 ) Total debt $ 87,839 $ 81,770 Current portion of long-term debt and finance obligation (21,738 ) (5,010 ) Long-term debt $ 66,101 $ 76,760 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 9 Months Ended |
Jul. 31, 2017 | |
Commitments And Contingencies Disclosure [Abstract] | |
Schedule of Non-Cancelable Minimum Payments Applicable to Operating and Capital Leases | Non-cancelable minimum payments applicable to operating and capital leases as of July 31, 2017 were as follows (in thousands): Operating Leases Capital Leases Due Year 1 $ 1,324 $ 384 Due Year 2 966 244 Due Year 3 497 90 Due Year 4 350 15 Due Year 5 374 5 Thereafter 3,471 — Total $ 6,982 $ 738 |
Nature of Business and Basis 35
Nature of Business and Basis of Presentation - Additional Information (Details) $ in Thousands | 1 Months Ended | 3 Months Ended | 4 Months Ended | 9 Months Ended | ||||
Jun. 30, 2017MW | Jul. 31, 2017USD ($) | Jul. 31, 2016 | Sep. 30, 2017Employee | Jul. 31, 2017USD ($) | Jul. 31, 2016 | Oct. 31, 2016USD ($) | ||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Debt issuance costs, deduction of current portion of long term debt | [1] | $ 129 | $ 129 | $ 152 | ||||
Debt issuance costs, deduction of long-term debt and other liabilities | [2] | $ 129 | $ 129 | 225 | ||||
Reduction in production capacity due to production rate adjustment | MW | 15 | |||||||
Scenario, Forecast [Member] | ||||||||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Number of manufacturing employees | Employee | 110 | |||||||
POSCO Energy [Member] | ||||||||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Common stock ownership percentage | 4.00% | 4.00% | ||||||
Significant customer revenue percentage | 13.00% | 65.00% | 9.00% | 52.00% | ||||
NRG Energy, Inc. [Member] | ||||||||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Common stock ownership percentage | 2.00% | 2.00% | ||||||
Significant customer revenue percentage | 0.60% | 0.30% | 0.40% | 0.20% | ||||
Accounting Standards Update 2015-03 [Member] | Current Assets [Member] | ||||||||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Debt issuance costs, deduction of current portion of long term debt | 300 | |||||||
Accounting Standards Update 2015-03 [Member] | Other Assets [Member] | ||||||||
Nature of Business and Basis of Presentation [Line items] | ||||||||
Debt issuance costs, deduction of long-term debt and other liabilities | $ 1,100 | |||||||
[1] | Represents the current portion of direct deferred finance costs that relate primarily to securing a $40.0 million loan facility with NRG which is being amortized over the five-year life of the facility. | |||||||
[2] | Represents the long-term portion of direct deferred finance costs relating to the Company’s loan facility with NRG which is being amortized over the five-year life of the facility. |
Recent Accounting Pronounceme36
Recent Accounting Pronouncements - Additional Information (Details) - Accounting Standards Update 2015-03 [Member] $ in Millions | Oct. 31, 2016USD ($) |
Current Assets [Member] | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Reclassification of debt issuance costs to be direct deduction of current portion of long term debt | $ 0.3 |
Other Assets, Net [Member] | |
New Accounting Pronouncements Or Change In Accounting Principle [Line Items] | |
Reclassification of debt issuance costs to be direct deduction of long-term debt and other liabilities | $ 1.1 |
Restructuring - Additional Info
Restructuring - Additional Information (Details) $ in Thousands | 9 Months Ended |
Jul. 31, 2017USD ($)Rate | |
Restructuring And Related Activities [Abstract] | |
Restructuring and Related Cost, Expected Number of Positions Eliminated | 96 |
Restructuring and Related Cost, Number of Positions Eliminated, Inception to Date Percent | Rate | 17.00% |
Restructuring Charges | $ | $ 1,355 |
Accounts Receivable - Schedule
Accounts Receivable - Schedule of Accounts Receivable (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Receivables [Abstract] | |||
Contract receivable | $ 3,494 | $ 5,411 | |
Unbilled contracts receivable | [1] | 11,590 | 13,651 |
Commercial customers accounts receivable | 15,084 | 19,062 | |
Government contract receivable | 2,231 | 2,463 | |
Government contract receivable, unbilled amounts | 9,001 | 3,068 | |
U.S. government accounts receivable total | [2] | 11,232 | 5,531 |
Accounts receivable, net | $ 26,316 | $ 24,593 | |
[1] | Additional unbilled recoverable costs of $13.0 million and $5.7 million are included within “Other assets” as of July 31, 2017 and October 31, 2016, respectively. | ||
[2] | Total U.S. Government accounts receivable outstanding as of July 31, 2017 and October 31, 2016 were $3.7 million and $2.2 million, respectively. |
Accounts Receivable - Schedul39
Accounts Receivable - Schedule of Accounts Receivable (Details) (Parenthetical) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Accounts Notes And Loans Receivable [Line Items] | |||
U.S. government accounts receivable total | [1] | $ 11,232 | $ 5,531 |
Long-term investments and receivables, net | 13,000 | 5,700 | |
Government [Member] | |||
Accounts Notes And Loans Receivable [Line Items] | |||
U.S. government accounts receivable total | $ 3,700 | $ 2,200 | |
[1] | Total U.S. Government accounts receivable outstanding as of July 31, 2017 and October 31, 2016 were $3.7 million and $2.2 million, respectively. |
Accounts Receivable - Additiona
Accounts Receivable - Additional Information (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 |
Accounts Notes And Loans Receivable [Line Items] | ||
Allowance for Doubtful Accounts Receivable, Current | $ 100 | $ 200 |
POSCO Energy [Member] | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Related Parties, Current | 2,000 | 5,000 |
NRG Energy, Inc. [Member] | ||
Accounts Notes And Loans Receivable [Line Items] | ||
Accounts Receivable, Related Parties, Current | $ 20 | $ 100 |
Inventories - Components of Inv
Inventories - Components of Inventories (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Inventory Disclosure [Abstract] | |||
Raw materials | $ 22,525 | $ 25,286 | |
Work-in-process | [1] | 49,459 | 48,520 |
Inventories | $ 71,984 | $ 73,806 | |
[1] | Included in work-in-process as of July 31, 2017 and October 31, 2016 was $40.1 million and $40.6 million, respectively, of completed standard components. |
Inventories - Components of I42
Inventories - Components of Inventories (Parenthetical) (Details) - USD ($) $ in Millions | Jul. 31, 2017 | Oct. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Completed Standard Component | $ 40.1 | $ 40.6 |
Inventories - Additional Inform
Inventories - Additional Information (Details) - USD ($) $ in Millions | Jul. 31, 2017 | Oct. 31, 2016 |
Inventory Disclosure [Abstract] | ||
Inventory valuation reserves | $ 0.2 | $ 0.2 |
Project Assets - Additional Inf
Project Assets - Additional Information (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Nov. 30, 2016 | Oct. 31, 2016 |
Project Assets [Abstract] | |||
Project assets without a sale-leaseback | $ 32,400 | ||
Long-term project assets | 67,201 | $ 47,111 | |
Sale leaseback transaction, net book value | 31,400 | ||
Fair value of acquired long-term project assets | $ 2,000 | $ 2,300 |
Other Current Assets (Details)
Other Current Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Deferred Costs Capitalized Prepaid And Other Assets Disclosure [Abstract] | |||
Advance payments to vendors | [1] | $ 800 | $ 1,247 |
Deferred finance costs | [2] | 129 | 152 |
Notes receivable | [3] | 1,007 | |
Prepaid expenses and other | [4] | 5,082 | 7,775 |
Other current assets | $ 6,011 | $ 10,181 | |
[1] | Advance payments to vendors relate to payments for inventory purchases ahead of receipt. | ||
[2] | Represents the current portion of direct deferred finance costs that relate primarily to securing a $40.0 million loan facility with NRG which is being amortized over the five-year life of the facility. | ||
[3] | Notes receivable were included in the consideration paid for the acquired fuel cell power plant discussed in Note 6. | ||
[4] | Primarily relates to other prepaid vendor expenses including insurance, rent and lease payments. |
Other Current Assets (Parenthet
Other Current Assets (Parenthetical) (Details) - NRG Energy, Inc. [Member] | 9 Months Ended |
Jul. 31, 2017USD ($) | |
Other Current Assets [Line Items] | |
Line of credit facility, expiration period | 5 years |
Line of Credit Facility, Maximum Borrowing Capacity | $ 40,000,000 |
Goodwill and Intangible Asset -
Goodwill and Intangible Asset - Additional Information (Details) - USD ($) | 9 Months Ended | ||
Jul. 31, 2017 | Jul. 31, 2016 | Oct. 31, 2016 | |
Goodwill And Intangible Assets Disclosure [Abstract] | |||
Goodwill | $ 4,075,000 | $ 4,075,000 | |
Intangible asset | 9,592,000 | $ 9,592,000 | |
Goodwill and intangible assets, impairment | $ 0 | $ 0 |
Other Assets - Schedule of Othe
Other Assets - Schedule of Other Assets (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Other Assets Noncurrent [Abstract] | |||
Long-term accounts receivable | [1] | $ 0 | $ 8,353 |
Long-term stack residual value | [2] | 657 | 0 |
Deferred finance costs | [3] | 129 | 225 |
Long-term unbilled recoverable costs | [4] | 13,032 | 5,714 |
Other | [5] | 2,627 | 2,123 |
Other assets | $ 16,445 | $ 16,415 | |
[1] | The balance as of October 31, 2016 represents receivables, which were subsequently collected and relate to project and stack replacement reserve accounts for a sale-leaseback transaction. As of July 31, 2017, the funds were recorded as long-term restricted cash. | ||
[2] | Relates to estimated residual value for module exchanges performed under the Company’s service agreements where the useful life extends beyond the contractual term of the service agreement and the Company obtains title for the module from the customer upon expiration or non-renewal of the service agreement. If the Company does not obtain rights to title from the customer, the full cost of the module is expensed at the time of the module exchange. The increase from October 31, 2016 represents residual value for two module replacements performed during the nine months ended July 31, 2017. | ||
[3] | Represents the long-term portion of direct deferred finance costs relating to the Company’s loan facility with NRG which is being amortized over the five-year life of the facility. | ||
[4] | Represents unbilled recoverable costs that relate to revenue recognized on customer contracts that will be billed in future periods in excess of twelve months from July 31, 2017. | ||
[5] | The Company entered into an agreement with one of its customers on June 29, 2016 which includes a fee for the purchase of the plants at the end of the term of the agreement. The option fee is payable in installments over the term of the agreement and the total paid as of July 31, 2017 was $1.4 million. Also included within other are long-term security deposits. |
Other Assets - Schedule of Ot49
Other Assets - Schedule of Other Assets (Parenthetical) (Details) $ in Millions | 9 Months Ended |
Jul. 31, 2017USD ($) | |
Other Assets Noncurrent [Abstract] | |
Deferred finance costs amortization period | 5 years |
Contractual Obligation | $ 1.4 |
Schedule of Accrued Liabilities
Schedule of Accrued Liabilities (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | |
Accrued Liabilities Current [Abstract] | |||
Accrued payroll and employee benefits | $ 4,311 | $ 4,183 | |
Accrued contract loss | 29 | 0 | |
Accrued product warranty cost | [1] | 226 | 516 |
Accrued material purchases | [2] | 3,199 | 6,908 |
Accrued service agreement costs | [3] | 3,076 | 6,030 |
Accrued taxes, legal, professional and other | 2,281 | 3,263 | |
Accrued liabilities | $ 13,122 | $ 20,900 | |
[1] | Activity in the accrued product warranty costs for the nine months ended July 31, 2017 included additions for estimates of future warranty obligations of $0.5 million on contracts in the warranty period and reductions related to actual warranty spend of $0.8 million as contracts progress through the warranty period or are beyond the warranty period. | ||
[2] | The Company acts as a procurement agent for POSCO under an Integrated Global Supply Chain Agreement whereby the Company procures materials on POSCO’s behalf for its Asian production facility. This liability represents amounts received for the purchase of materials on behalf of POSCO. Amounts due to vendors is recorded as “Accounts payable.” | ||
[3] | Activity in service agreement costs represents a decrease in loss accruals on service contracts of $1.8 million from $2.7 million as of October 31, 2016 to $0.9 million as of July 31, 2017. The decrease primarily relates to module exchanges performed during the nine months ended July 31, 2017. The accruals for performance guarantees also decreased from $3.3 million as of October 31, 2016 to $2.1 million as of July 31, 2017 resulting from guarantee payments to customers partially offset by additional accruals for the minimum output falling below the contract requirements for certain service agreements. |
Schedule of Accrued Liabiliti51
Schedule of Accrued Liabilities (Parenthetical) (Details) - USD ($) $ in Millions | 9 Months Ended | |
Jul. 31, 2017 | Oct. 31, 2016 | |
Accrued Liabilities Current [Abstract] | ||
Product warranty accrual, warranties issued | $ 0.5 | |
Product warranty accrual, payment and adjustments | 0.8 | |
Loss reserve on service agreements | 0.9 | $ 2.7 |
Increase in reserve for service agreement costs | 1.8 | |
Reserve for performance guarantees | $ 2.1 | $ 3.3 |
Shareholders' Equity - Schedule
Shareholders' Equity - Schedule of Stockholders Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2017 | Jul. 31, 2016 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Preferred stock dividends | $ (800) | $ (800) | $ (2,400) | $ (2,400) |
Foreign currency translation adjustments | 199 | (228) | 161 | (26) |
Net loss | (17,001) | $ (11,067) | (43,924) | $ (38,260) |
Parent [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Stockholders' equity, Including Portion Attributable to Noncontrolling Interest | 114,396 | |||
Share-based compensation | 3,432 | |||
Warrant exercises | 1,782 | |||
Stock issued under benefit plans net of taxes paid upon vesting of restricted stock awards | 51 | |||
Preferred stock dividends | (2,400) | |||
Foreign currency translation adjustments | 161 | |||
Net loss | (43,924) | |||
Stockholders' equity, Including Portion Attributable to Noncontrolling Interest | $ 99,813 | 99,813 | ||
Common Stock and Pre-Funded Warrants [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Sale of common stock and warrants, net | 12,427 | |||
Public Offering [Member] | Common Stock and Warrants [Member] | Parent [Member] | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Sale of common stock and warrants, net | $ 13,888 |
Shareholders' Equity - Addition
Shareholders' Equity - Additional Information (Details) - USD ($) $ / shares in Units, $ in Millions | May 03, 2017 | Jul. 31, 2017 | Jul. 31, 2017 | Oct. 31, 2016 | Jul. 31, 2016 |
NRG Energy, Inc. [Member] | |||||
Stockholders' Equity Note | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 40.20 | $ 40.20 | |||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 200,000 | 200,000 | |||
Warrants expiration date | Jul. 30, 2017 | ||||
Series C Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 12,000,000 | 12,000,000 | |||
Series D Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 10,622,460 | 10,622,460 | |||
Series A Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 5.83 | $ 5.83 | |||
Class of Warrant or Right, Outstanding | 7,680,000 | 7,680,000 | |||
Series B Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of Warrant or Right, Outstanding | 4,926,000 | 4,926,000 | 3,826,000 | ||
Class of Warrant or Right, Number of Securities Called by Warrants or Rights | 4,926,000 | ||||
Underwritten Public Offering [Member] | |||||
Stockholders' Equity Note | |||||
Stock issued during period, shares, new issues | 12,000,000 | ||||
Gross proceeds from common stock and warrants | $ 15.4 | ||||
Common stock price per share | $ 1.28 | ||||
Net proceeds from common stock and warrants | $ 13.9 | ||||
Underwritten Public Offering [Member] | Series C Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of warrants or rights issued | 12,000,000 | ||||
Warrants issued, price per share | $ 1.28 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.28 | ||||
Class of warrant or right term | 1 year | ||||
Underwritten Public Offering [Member] | Series D Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Class of warrants or rights issued | 12,000,000 | ||||
Warrants issued, price per share | $ 1.28 | ||||
Class of Warrant or Right, Exercise Price of Warrants or Rights | $ 1.60 | ||||
Class of warrant or right term | 5 years | ||||
Common Stock [Member] | |||||
Stockholders' Equity Note | |||||
Stock issued during period, shares, new issues | 7,200,000 | ||||
Stock issued during period on open market, net of fees | $ 12.4 | ||||
Common Stock [Member] | Underwritten Public Offering [Member] | Series D Warrants [Member] | |||||
Stockholders' Equity Note | |||||
Stock issued during period, shares, new issues | 1,377,540 | ||||
Net proceeds from common stock and warrants | $ 1.8 |
Loss Per Share - Calculation of
Loss Per Share - Calculation of Basic and Diluted Loss Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | |||
Jul. 31, 2017 | Jul. 31, 2016 | Jul. 31, 2017 | Jul. 31, 2016 | ||
Numerator | |||||
Net loss | $ (17,001) | $ (11,067) | $ (43,924) | $ (38,260) | |
Net loss attributable to noncontrolling interest | 0 | 57 | 0 | 165 | |
Preferred stock dividends | (800) | (800) | (2,400) | (2,400) | |
Net loss attributable to common shareholders | $ (17,801) | $ (11,810) | $ (46,324) | $ (40,495) | |
Denominator | |||||
Weighted average basic common shares | 57,420,050 | 31,015,658 | 45,903,033 | 28,680,596 | |
Effect of dilutive securities | [1] | 0 | 0 | 0 | 0 |
Weighted average diluted common shares | 57,420,050 | 31,015,658 | 45,903,033 | 28,680,596 | |
Basic loss per share | $ (0.31) | $ (0.38) | $ (1.01) | $ (1.41) | |
Diluted loss per share | [1] | $ (0.31) | $ (0.38) | $ (1.01) | $ (1.41) |
[1] | Due to the net loss to common shareholders in each of the periods presented above, diluted loss per share was computed without consideration to potentially dilutive instruments as their inclusion would have been antidilutive. As of July 31, 2017 and 2016, potentially dilutive securities excluded from the diluted loss per share calculation are as follows: |
Loss Per Share - Schedule of Po
Loss Per Share - Schedule of Potentially Dilutive Securities Excluded from the Diluted Loss Per Share Calculation (Details) - shares | 9 Months Ended | |
Jul. 31, 2017 | Jul. 31, 2016 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Share-based compensation arrangement by share-based payment award, options, outstanding, number | 316,330 | 247,776 |
Convertible preferred stock, shares issued upon conversion | 454,043 | 454,043 |
Antidilutive securities excluded from computation of earnings per share, amount | 33,092,329 | 14,399,730 |
Series 1 Preferred Shares [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Convertible preferred stock, shares issued upon conversion | 15,166 | 15,166 |
Unvested Restricted Stock Awards [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Share-based compensation arrangement by share-based payment award, non-option equity instruments, outstanding, number | 2,004,330 | 910,079 |
Series A Warrant [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Class of warrant or right, number of securities called by warrants or rights | 7,680,000 | 7,680,000 |
Series C Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Class of warrant or right, number of securities called by warrants or rights | 12,000,000 | |
NRG Energy, Inc. [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Class of warrant or right, number of securities called by warrants or rights | 166,666 | |
Series D Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Class of warrant or right, number of securities called by warrants or rights | 10,622,460 | |
Series B Warrants [Member] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Class of warrant or right, number of securities called by warrants or rights | 4,926,000 |
Restricted Cash - Additional In
Restricted Cash - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Jul. 31, 2017 | Oct. 31, 2016 | |
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash and cash equivalents | $ 38,100 | $ 34,100 |
Restricted cash and cash equivalents - long-term | 33,480 | 24,692 |
Reserves for obligations | $ 17,000 | |
Letter of credit date of expiration | Apr. 30, 2019 | |
Letters of credit outstanding, amount | $ 2,900 | 7,900 |
Dominion Bridgeport FuelCell Park [Member] | ||
Restricted Cash and Cash Equivalents Items [Line Items] | ||
Restricted cash and cash equivalents - long-term | $ 15,000 | $ 15,000 |
Debt instrument, term | 15 years |
Debt and Finance Obligation - S
Debt and Finance Obligation - Schedule of Debt (Details) - USD ($) $ in Thousands | Jul. 31, 2017 | Oct. 31, 2016 | Nov. 09, 2015 |
Debt Instrument [Line Items] | |||
Capitalized lease obligations | $ 738 | $ 660 | |
Deferred finance costs | (1,415) | (1,408) | |
Total debt | 87,839 | 81,770 | |
Current portion of long-term debt and finance obligation | (21,738) | (5,010) | |
Long-term debt | 66,101 | 76,760 | |
Connecticut Development Authority Note [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | 2,410 | 2,589 | |
Debt Instrument, Face Amount | 4,000 | ||
Connecticut Clean Energy Fund [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | 6,052 | 6,050 | |
NRG Energy, Inc. [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | 1,755 | ||
PNC Energy Capital, LLC [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | 46,980 | 41,603 | |
CT Department of Economic & Community Development [Member] | |||
Debt Instrument [Line Items] | |||
Debt Instrument, Face Amount | 10,000 | 10,000 | $ 10,000 |
Hercules Capital, Inc. [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | 21,229 | $ 20,521 | |
New Britain Renewable Energy Member [Member] | |||
Debt Instrument [Line Items] | |||
Long-term Line of Credit | $ 1,845 |
Debt and Finance Obligation - A
Debt and Finance Obligation - Additional Information (Details) - USD ($) | 9 Months Ended | |||||
Jul. 31, 2017 | Jul. 31, 2016 | Nov. 30, 2016 | Oct. 31, 2016 | Nov. 09, 2015 | Mar. 05, 2013 | |
Debt Instrument [Line Items] | ||||||
Proceeds from Issuance of Debt | $ 17,891,000 | $ 44,781,000 | ||||
Lease Payment Terms | 36 months | |||||
Connecticut Development Authority Note [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Face Amount | $ 4,000,000 | |||||
Collateralized Agreements | $ 4,000,000 | |||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | |||||
Long-term Line of Credit | $ 2,410,000 | $ 2,589,000 | ||||
Connecticut Clean Energy Fund [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 5.00% | |||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 5,900,000 | |||||
Long-term Line of Credit | 6,052,000 | 6,050,000 | ||||
NRG Energy, Inc. [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 40,000,000 | |||||
NRG Energy, Inc. [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 8.50% | |||||
NRG Energy, Inc. [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 8.00% | |||||
PNC Energy Capital, LLC [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Long-term Line of Credit | $ 46,980,000 | 41,603,000 | ||||
CT Department of Economic & Community Development [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Face Amount | $ 10,000,000 | 10,000,000 | $ 10,000,000 | |||
State of Connecticut [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage | 2.00% | |||||
Term of loan | 15 years | |||||
Hercules Capital, Inc. [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of Credit Facility, Maximum Borrowing Capacity | $ 25,000,000 | |||||
Long-term Line of Credit | $ 21,229,000 | $ 20,521,000 | ||||
Term of loan | 30 months | |||||
Proceeds from Issuance of Debt | $ 20,000,000 | |||||
Other Deductions and Charges | $ 1,700,000 | |||||
Debt Instrument, Covenant Description | The loan contains a financial covenant whereby the Company is required to maintain an unrestricted cash balance of at least (a) 75% of the outstanding Loan balance plus (b) the amount of accounts payable (as defined under GAAP) not paid within 90 days of the date payment was issued. | |||||
Hercules Capital, Inc. [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 9.75% | |||||
Hercules Capital, Inc. [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 9.50% | |||||
New Britain Renewable Energy Member [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt Instrument, Interest Rate, Stated Percentage Rate Range, Maximum | 5.00% | |||||
Long-term Line of Credit | $ 1,845,000 | |||||
Notes Payable to Bank, Current | $ 1,800,000 | $ 2,300,000 |
Benefit Plans - Additional Info
Benefit Plans - Additional Information (Details) - USD ($) $ in Millions | 9 Months Ended | |
Jul. 31, 2017 | Apr. 30, 2017 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Stock Issued During Period, Shares, Issued for Services | 86,000 | |
Noninterest Expense Directors Fees | $ 0.1 | |
Restricted Stock Awards and Units [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Share-based compensation arrangement by share-based payment award, non-option equity instruments, granted | 2,600,000 | |
Share-based compensation arrangement by share-based payment award, non-option equity instruments, outstanding, number | 3,100,000 | |
Restricted Stock Awards and Units [Member] | Minimum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Restricted stock awards, general vesting period | 3 years | |
Restricted Stock Awards and Units [Member] | Maximum [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Restricted stock awards, general vesting period | 4 years | |
2010 Equity Incentive plan [Member] | ||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||
Common Stock, Capital Shares Reserved for Future Issuance | 4,500,000 | |
Share-based Compensation Arrangement by Share-based Payment Award, Number of Shares Available for Grant | 200,000 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Thousands | 9 Months Ended | ||
Jul. 31, 2017 | Oct. 31, 2016 | Nov. 09, 2015 | |
Commitments And Contingencies [Line Items] | |||
Capitalized lease obligations | $ 738 | $ 660 | |
Lease Payment Terms | 36 months | ||
Reserve for performance guarantees | $ 2,100 | 3,300 | |
Loss reserve on service agreements | 900 | 2,700 | |
Recorded Unconditional Purchase Obligation | 26,400 | ||
CT Department of Economic & Community Development [Member] | |||
Commitments And Contingencies [Line Items] | |||
Debt Instrument, Face Amount | $ 10,000 | $ 10,000 | $ 10,000 |
Commitments and Contingencies61
Commitments and Contingencies - Schedule of Non-Cancelable Minimum Payments Applicable to Operating and Capital Leases (Details) $ in Thousands | Jul. 31, 2017USD ($) |
Commitments And Contingencies Disclosure [Abstract] | |
Operating leases, due in one year | $ 1,324 |
Operating Leases, due in two years | 966 |
Operating leases, due in three years | 497 |
Operating leases, due in four years | 350 |
Operating leases, due in five years | 374 |
Operating leases, due thereafter | 3,471 |
Operating leases, future minimum payments due | 6,982 |
Capital leases, future minimum payments due, next twelve months | 384 |
Capital leases, future minimum payments due in two years | 244 |
Capital leases, future minimum payments due in three years | 90 |
Capital leases, future minimum payments due in four years | 15 |
Capital leases, future minimum payments due in five years | 5 |
Capital leases, future minimum payments due thereafter | 0 |
Capital leases, future minimum payments due | $ 738 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) $ / shares in Units, $ in Millions | Sep. 05, 2017USD ($)$ / sharesshares | Aug. 29, 2017USD ($)MW | Jul. 31, 2017 |
Subsequent Event [Line Items] | |||
Stockholders' equity, reverse stock split | 1-for-12 | ||
Hercules Capital, Inc. [Member] | |||
Subsequent Event [Line Items] | |||
Debt Instrument, Covenant Description | The loan contains a financial covenant whereby the Company is required to maintain an unrestricted cash balance of at least (a) 75% of the outstanding Loan balance plus (b) the amount of accounts payable (as defined under GAAP) not paid within 90 days of the date payment was issued. | ||
Series C Preferred Stock [Member] | Convertible Preferred Offering [Member] | Hercules Capital, Inc. [Member] | |||
Subsequent Event [Line Items] | |||
Debt Instrument, Covenant Description | to require us to maintain an unrestricted blocked cash balance of at least the greater of (x) (a) $20.0 million plus (b) the amount of accounts payable not paid within 90 days of the date payment was issued and (y) (a) 100% of the outstanding loan balance plus (b) the amount of accounts payable not paid within 90 days of the date payment was issued | ||
Subsequent Event [Member] | Series C Preferred Stock [Member] | Convertible Preferred Offering [Member] | |||
Subsequent Event [Line Items] | |||
Underwritten offering of convertible preferred stock | shares | 33,500 | ||
Preferred stock dividend rate | 0.00% | ||
Conversion of stock conversion price | $ / shares | $ 1.84 | ||
Stock price per share | $ / shares | $ 895.52 | ||
Gross proceeds from sale of preferred stock | $ 30 | ||
Offering closed date | Sep. 8, 2017 | ||
Subsequent Event [Member] | Series C Preferred Stock [Member] | Convertible Preferred Offering [Member] | Hercules Capital, Inc. [Member] | |||
Subsequent Event [Line Items] | |||
Minimum unrestricted blocked cash balance | $ 20 | ||
Subsequent Event [Member] | Hanyang Industrial Development Company Ltd. [Member] | |||
Subsequent Event [Line Items] | |||
Contract to sell fuel cell plants | MW | 20 | ||
Project represent in excess of product revenue | $ 60 |