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Andy Marsh is the chief executive of Plug Power.
DONNA ABBOTT-VLAHOS
When Andy Marsh walked onto the factory floor at Plug Power for the first time in 2008, it was silent.
The company wasn't making anything.
Plug Power was spending $40 million a year on research and product development. It had racked up an accumulated deficit of a half billion dollars. And it had just finished the year with $16.3 million in sales.
The Latham fuel cell manufacturer (Nasdaq: PLUG) had seen its value on the stock market, something traders refer to as market capitalization, fall from $8 billion shortly after it went public in 1999 to about $300 million when Marsh walked in as the new chief executive officer.
The outlook for Plug Power and Andy Marsh is on a much different path today. Shares that were trading for $3.16 on New Year's Eve 2019 have been trading for between $30 and $37 a share for the past week.
Meanwhile, the company's market cap has climbed from $1 billion at the end of last year to roughly $16 billion. Market cap is calculated by multiplying current stock price by the number of outstanding shares.
With Plug Power's climb, the Albany region once again is home to a public company with a market cap above $1 billion. Momentive Performance Materials, the Waterford silicone maker, previously held that position before it was acquired by a group of Korean companies and investors.
Prior to that, it was Albany International before the company ended its 115-year run in the region, moving its headquarters from Menands to New Hampshire in October 2010, after changing its focus from the paper industry to aerospace.
For Plug Power, the homegrown manufacturer has climbed the ranks of Albany public companies as revenue nearly tripled from $83 million in 2016 to $230 million last year.
Marsh expects gross billings will reach somewhere between $325 million and $330 million this year.
The company is moving toward Marsh's goal of hitting $1.2 billion in annual sales and $250 million in earnings before interest, taxes, depreciation and amortization by the end of 2024.
As growth is accelerating, Marsh is careful not to be overly optimistic about his projections.
"I've done this for a dozen years," Marsh told analysts during a November earnings call. "I have been less wrong recently than I've been in the past. ... It's taught me to be conservative."
The company has grown by building a market making and selling fuel cells as an alternative to batteries. Those fuel cells are used to power forklifts in distribution centers and factories for Walmart, Amazon, Home Depot, Kroger and BMW.
To help feed the sales pipeline and add revenue, Plug Power decided several years ago to start building hydrogen fueling stations for customers to make it quicker, cheaper and easier for forklift operators to reload.
Now, the company has expanded to make fuel cells for everything from delivery trucks and drones to backup power supplies for data centers and power producers.
That has attracted the attention of customers and investors because of the growing thirst for hydrogen and other renewable energy sources amid the push to reduce carbon emissions.
As a result, the company that sold 4,000 of its GenDrive fuel cells in 2016 shipped that same number during its most recent quarter.
"This business is growing as expected. And we're moving into on-road vehicles and large-scale backup power systems," Marsh said during the November earnings call.
Now, Plug is investing heavily to build out its hydrogen fueling network.
The company spent $123 million in June to purchase United Hydrogen Group and Giner ELX Inc., part of a plan to build hydrogen generation plants, while adding the ability to make hydrogen electrolyzers to give customers more options for reloading fuel cells.
Last month, Plug Power took another major step, compiling a large amount of cash as Marsh prepares to build five hydrogen generation plants at an estimated cost of about $100 million apiece.
In November, nine investment banks collectively spent close to $1 billion buying Plug stock. It was the largest capital raise in Plug's 23-year history. Plug has now stockpiled about $1.7 billion in cash.
Plug's growth also comes during the global Covid-19 pandemic that has hurt many industries across the United States. Marsh is quick to point out that the company has fared well during the pandemic with many of its customers seeing a spike in demand.
Marsh estimates that Plug Power fuel cells are used to move 30% or more of the groceries and retail food in the United States.
