Mr. John Sheridan reports

BALLARD REPORTS 2011 RESULTS AND 2012 OUTLOOK; CONTINUED PROGRESS IN 2011, BUILDING ON 2010 ACHIEVEMENTS; REVENUE OF APPROXIMATELY $100M EXPECTED IN 2012; ADJUSTED EBITDA OF APPROXIMATELY BREAKEVEN EXPECTED IN 2012

Ballard Power Systems Inc. has released its consolidated financial results for the fourth quarter and year ended Dec. 31, 2011, and provided an outlook for 2012. All amounts are in U.S. dollars unless otherwise noted and have been prepared in accordance with international financial reporting standards.

Summary of 2011 results and 2012 outlook

Full-year 2011 results reflect continued progress in all key financial metrics, top line and bottom line, including 17-per-cent revenue growth, two-point gain in gross margin, 7-per-cent cash operating cost reduction and 15-per-cent adjusted earnings before interest, taxes, depreciation and amortization improvement.

The extent of progress in revenue and adjusted EBITDA, however, was less than the company's original full-year guidance. This was related to risk factors identified with the release of third-quarter 2011 results, specifically delays in the timing of major bus orders -- affecting both revenue and adjusted EBITDA -- and the added impacts on adjusted EBITDA of negative foreign exchange movements and restructuring charges. While these delays in timing of bus module shipments negatively impacted 2011 results, they had a positive impact on the 12-month order book, which was $45.3-million at year-end.

This strong order book is an underpinning to the company's outlook for 2012, together with cumulative progress Ballard has posted over the past two years, including 63-per-cent revenue growth and 43-per-cent adjusted EBITDA improvement over the 2009 to 2011 period.

This positioning, along with signs of increasing market momentum, supports management's strong outlook for 2012, with expectations for:

• Revenue of approximately $100-million;
• Adjusted EBITDA of approximately break-even.

John Sheridan, president and chief executive officer, said, "Given the challenges of developing new markets in a tough global economy, we are pleased with continued progress posted in 2011 and believe Ballard is well positioned to take a milestone step in 2012 on our path to profitability."

Key 2011 highlights:

• Revenue increased 17 per cent on a full-year basis, to $76.0-million:
  • Fuel cell product revenue grew 36 per cent and represented 61 per cent of total revenue.
• Gross margin declined to 20 per cent in the fourth quarter, due to the impact on product mix resulting from lower bus module shipments, and increased to 18 per cent for the full year.
• Cash operating costs were reduced to $8.6-million in the fourth quarter and $39.3-million for the full year, improvements of 11 per cent and 7 per cent, respectively.
• Full-year adjusted EBITDA was a loss of $22.3-million, an improvement of 15 per cent, despite a shortfall in bus module shipments, negative foreign exchange impacts of $2-million and restructuring charges of $1.4-million.
• In the fourth quarter, $3.9 million of positive cash was generated by operating activities, compared with $1.8-million in 2010. For the full year, cash used by operating activities increased by $3.9-million to negative $33.2-million, driven by increased working capital requirements of negative $10.2-million, which more than offset reductions in cash operating losses of $6.3-million.
• Cash reserves were $46.2-million, or $41.6-million net of $4.6-million outstanding on the company's bank operating line.

2012 business outlook

As context for the company's 2012 business outlook, Ballard notes a number of signs of increasing market momentum in 2011:

• Initial order activity in the large, high-growth markets of India, South Africa and Brazil;
• Establishment of partner relationships with major global companies;
• Demand for new PEM fuel cell applications in mining, waste-to-energy and large-scale backup power.

In addition, announcements by Ballard of several recent commercial developments provide more specific evidence of this increasing momentum in fuel cell markets:

• Supply agreement with Van Hool NV for FCvelocity-HD6 fuel cell modules in Europe;
• Letter of intent for FCvelocity-HD6 fuel cell modules for Sao Paulo, Brazil;
• Memorandum of understanding with Tata Motors for FCvelocity-1100 fuel cell stacks to be used in India buses;
• Dantherm Power system sales to customers in South Africa and Europe.

As such, Ballard's outlook is for aggressive growth in fuel cell products, which is expected to drive total revenue to approximately $100-million in 2012.

In terms of adjusted EBITDA, during 2012 Ballard expects to make improvements in the key enablers of gross margin and cash operating costs. Significant gross margin improvement is expected to be primarily driven by an aggressive product cost-reduction program and shift in product mix. A significant reduction in cash operating costs is anticipated, largely enabled by corporate streamlining undertaken in 2011 and planned selling, general and administrative reductions in 2012. In addition, the company expects to offset an increased proportion of research and product development expenditures through third party financing, thereby decreasing associated cash operating costs. With these expected improvements in gross margin and operating costs, along with the expected growth in revenue to approximately $100-million, Ballard expects adjusted EBITDA in 2012 to be approximately breakeven. This 2012 business outlook represents a milestone step for Ballard on its path to profitability.

The primary risks to this outlook relate to the timing of major orders and shipments for fuel cell bus modules and backup power systems.

                                          2011 FINANCIAL HIGHLIGHTS
                                          (millions of U.S. dollars)

                                        Three months ended Dec. 31,   12 months ended Dec. 31,
                                                     2011     2010             2011      2010
Revenue
Fuel cell products                                 $ 16.9   $ 13.7           $ 46.5    $ 34.2
Contract automotive                                   0.1      3.0              9.3       9.8
Material products                                     4.0      4.4             20.2      21.0
                                                   -------  -------          -------   -------
Total revenue                                        21.0     21.1             76.0      65.0
Fuel cell stack shipments (units)
Total fuel cell stack shipments                       942    1,119            3,265     3,014
Material handling                                     799      345            1,422     1,100
Backup power                                          124      654            1,447     1,664
12-month rolling order book                        $ 45.3   $ 35.0
Gross margin                                           20%      24%              18%       16%
Cash operating costs                               $  8.6   $  9.7           $ 39.3    $ 42.1
Adjusted EBITDA (loss)                               (3.8)    (3.6)           (22.3)    (26.2)
                                                   -------  -------          -------   -------
Net income (loss)                                  $ (7.3)  $ (9.0)          $(33.4)   $(31.5)
                                                   =======  =======          =======   =======
(Loss) per share                                   $(0.09)  $(0.11)          $(0.40)   $(0.37)
                                                   -------  -------          -------   -------

For a more detailed discussion of Ballard Power Systems' 2011 results and 2012 outlook, please see the company's financial statements, and management's discussion and analysis, which are available one the company's website, SEDAR and EDGAR.

Conference call

Ballard will hold a conference call on Thursday, Feb. 23, 2012, at 8 a.m. PST (11 a.m. EST), to review its 2011 operating results and 2012 outlook. The live call can be accessed by dialling 1-604-638-5340. Alternatively, a live audio webcast can be accessed through a link on Ballard's homepage. Following the call, the audio webcast will be archived in the quarterly results area of the investor section of Ballard's website.

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