Management Commentary
“We are making progress on our strategic priorities, including moving forward with our revised product portfolio roadmap,” said Workhorse CEO
First Quarter 2022 and Recent Operational Highlights:
Workhorse delivered on its stated priorities from the first quarter by enhancing its team and strengthening its financial and operational position in the following key areas:
- Hired talented executives to oversee critical roles within the Company, including:
- Hired a Chief Information Officer with more than 35 years of supply chain and IT leadership experience in the automotive industry at leading OEMs and Tier 1 suppliers.
- Hired a new attorney as Corporate Counsel who brings 5-plus years of business and commercial law experience.
- Hired a Director of Quality with 35-plus years of quality systems experience at large OEMs, including within powertrain, assembly and Supplier Quality and Development.
- Hired a Director of Production Control and Logistics with more than 25 years of supply chain & LEAN systems experience at Tier 1 auto suppliers.
- Completed the consolidation and relocation of the Company’s headquarters to
Sharonville, Ohio . Bringing together the Company’s leadership and advanced technology teams has already improved efficiencies and teamwork across functions of the organization. - Recently opened a new technical design and testing center in
Wixom, Michigan to expand and enhance design, engineering and testing capabilities. Workhorse hired additional experienced engineers with automotive, controls and EV propulsion systems experience. - Made significant progress transforming Workhorse’s
Union City plant to become a world class manufacturing center with the goal of starting production in the facility in Q3 2022. - Entered into previously announced deleveraging transaction with
High Trail Capital to exchange outstanding notes for Workhorse’s common stock, eliminating the remaining debt on Workhorse’s balance sheet.
Executing Revised Strategic Product Roadmap
Workhorse is on track to execute its revised strategic product roadmap to deliver its electric vehicle delivery offerings through a multi-faceted approach across four electric vehicle platforms:
- C1000: All FMVSS changes have been finalized and released. Front suspension design and vehicle bill of materials are completed. The Company is on track to return vehicles to service starting in August of this year and repair 161 previously manufactured vehicles produced to date by year-end. Workhorse will also manufacture 50-75 additional C1000’s by year-end from inventory on hand. The Company will then retire the model, ending production of new vehicles while continuing to provide service and parts to customers with vehicles that are on the road.
- W750/W4CC: The Company expects to start production of these Class 4 delivery vehicles in Q3 2022. Both the step van and cab chassis configuration versions will have demonstration vehicles displayed at the Advanced Clean Transportation Expo in
Long Beach, CA fromMay 9-13, 2022 . Workhorse has already received its first purchase orders for this vehicle family, with both offerings having successfully achieved California HVIP approval. - W56: Workhorse continues to meet all timing milestones for the beginning of production for this vehicle serving the Class 5 and 6 delivery van and truck market segments. The Company expects to start production in Q3 2023. Sourcing decisions and contract commitments are already in place for more than 50% of the platform bill of materials.
- W34: The Company continues to expect the beginning of production for the new Class 3-4 vehicle in 2024.
Additionally, Workhorse has entered into a multi-year referral agreement with ChargePoint, the largest network of electric vehicle charging stations, throughout the
Progress in Aerospace Technology
Workhorse continues to invest in its drone operations and secure key partnerships, including:
- Finalizing development and testing phase for market segment-leading payload and range capabilities.
- Pursuing additional grants and contracts with the
U.S. Department of Agriculture (“USDA”) to provide monitoring, data procurement and analytics as part of demonstration projects. These efforts follow the grants the Company obtained from theUSDA in Q4 2021. - Through a dedicated development effort, Workhorse has designed an in-house, market-leading winch with 99.1% testing success rate. Extensive field testing continues.
- Currently operating in
North Dakota andMississippi to support government programs.
First Quarter 2022 Financial Results
Sales, net of returns and allowances, for the first quarter of 2022 were recorded at
Cost of sales decreased to
Selling, general and administrative (“SG&A”) expenses increased to
Research and development (“R&D”) expenses were nearly unchanged at
Net interest expense was
Other loss was zero compared to
Net loss was
As of
2022 Guidance
Workhorse is reaffirming its commitment to manufacture and sell at least 250 vehicles in 2022, assuming current supply chain visibility remains unchanged, and to generate at least
“The Workhorse team delivered a solid quarter of execution to start the year. By adding talent into our workforce, further strengthening our balance sheet and making progress on our clear plan to ramp up production, we are on track to achieve our annual outlook,” said Workhorse CFO
Conference Call
Workhorse management will hold a conference call today (
International dial-in: 201-689-8341
The conference call will be broadcast live and available for replay here and via the Investor Relations section of Workhorse's website: https://ir.workhorse.com/.
Please call the conference telephone number 10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 949-574-3860.
The conference call will be broadcast live and available for replay here and via the Investor Relations section of Workhorse's website.
A telephonic replay of the conference call will be available after
Toll-free replay number: 877-660-6853
International replay number: 201-612-7415
Replay ID: 13729472
About
Workhorse is a technology company focused on providing drone-integrated electric vehicles to the last-mile delivery sector. As an American original equipment manufacturer, we design and build high performance, battery-electric vehicles including trucks and aircraft. Workhorse also develops cloud-based, real-time telematics performance monitoring systems that are fully integrated with our vehicles and enable fleet operators to optimize energy and route efficiency. All Workhorse vehicles are designed to make the movement of people and goods more efficient and less harmful to the environment. For additional information visit workhorse.com.
Forward-Looking Statements
This press release contains forward-looking statements reflecting our current expectations that involve risks and uncertainties. These statements are made under the “safe harbor” provisions of the
Media Contact:
212-355-4449
Investor Relations Contact:
Gateway Investor Relations
949-574-3860
WKHS@gatewayir.com
Condensed Consolidated Statements of Operations
(Unaudited)
Three Months Ended | |||||||
2022 | 2021 | ||||||
Sales, net of returns and allowances | $ | 14,299 | $ | 521,060 | |||
Cost of sales | 3,923,351 | 6,225,299 | |||||
Gross loss | (3,909,052 | ) | (5,704,239 | ) | |||
Operating expenses | |||||||
Selling, general and administrative | 11,910,259 | 6,885,830 | |||||
Research and development | 4,011,934 | 3,863,715 | |||||
Total operating expenses | 15,922,193 | 10,749,545 | |||||
Loss from operations | (19,831,245 | ) | (16,453,784 | ) | |||
Interest expense (income), net | 2,223,290 | (14,920,473 | ) | ||||
Other loss | - | (136,605,952 | ) | ||||
Loss before benefit for income taxes | (22,054,535 | ) | (138,139,263 | ) | |||
Benefit for income taxes | - | (17,632,492 | ) | ||||
Net loss | $ | (22,054,535 | ) | $ | (120,506,771 | ) |
Condensed Consolidated Balance Sheets
(Unaudited) | |||||
Assets | |||||
Current assets: | |||||
Cash and cash equivalents | $ | 167,047,876 | $ | 201,647,394 | |
Accounts and lease receivable | 51,429 | 149,776 | |||
Inventory, net | 12,677,469 | 10,067,367 | |||
Prepaid expenses and other current assets | 8,872,177 | 4,357,829 | |||
Total current assets | 188,648,951 | 216,222,366 | |||
Property, plant and equipment, net | 10,738,355 | 7,897,807 | |||
Lease right-of-use assets | 10,012,515 | 1,538,852 | |||
Other assets | 126,310 | 2,479,865 | |||
Total Assets | $ | 209,526,131 | $ | 228,138,890 | |
Liabilities | |||||
Current liabilities: | |||||
Accounts payable | $ | 6,258,630 | $ | 7,849,607 | |
Accrued liabilities and other | 9,945,712 | 14,752,827 | |||
Warranty liability | 4,315,463 | 4,583,916 | |||
Current portion of lease liabilities | 975,466 | 363,714 | |||
Total current liabilities | 21,495,271 | 27,550,064 | |||
Lease liabilities, long-term | 6,763,734 | 1,191,053 | |||
Convertible notes, at fair value | 25,072,357 | 24,705,000 | |||
Total Liabilities | 53,331,362 | 53,446,117 | |||
Stockholders' equity | 156,194,769 | 174,692,773 | |||
Total Liabilities and Stockholders' Equity | $ | 209,526,131 | $ | 228,138,890 |
Source:
2022 GlobeNewswire, Inc., source