Company: Vicinity Motor Corp
Listings :TSXV , NASDAQ
Ticker: VMC.V & VEV
Market cap at time of publication: $71 MCAD
Stock price at time of publication: $ 1.61 CAD
Target price: 14 CAD by Catalyst Research
Business: Leading supplier of electric, CNG, gas and clean-diesel buses for
both public and commercial enterprise use in the U.S and Canada
Comparable peer : Lion Electric Market
As expected Vicinity Motors did not report strong figures in Q3 due to supply chain issues. What’s good to see is that the new class 3 last mile vehicle VMC 1200 seems like an exception to this and the company is exxpected to begin deliveries in end of November 2022 for the new vehicle model. CEO William Trainer expects 2023 will be a record year with a backlog of over USD$190 million.
Full press release below:
Vicinity Motor Corp. Reports Third Quarter 2022 Financial Results
VANCOUVER, BC / November 15, 2022 / Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC)(FRA:6LGA) (“Vicinity” or the “Company”), a North American supplier of commercial electric vehicles, today reported its financial and operational results for the third quarter ended September 30, 2022.
Third Quarter 2022 and Subsequent Highlights
- Current order backlog exceeds $190 million, the vast majority of which are for electric vehicles.
- Secured a further US$100M+ purchase order for 1,000 VMC 1200 electric trucks from Pioneer Auto Group – Vicinity’s exclusive dealer in the province of British Columbia, Canada – with initial deliveries to this customer beginning in November 2022.
- Secured an order from strategic partner Sustainability Partners LLC, an ESG focused Public Benefit Company committed to eliminating deferred maintenance infrastructure by enabling sustainability, for four (4) Vicinity Lightning™ electric buses via Soderholm Sales & Leasing, Inc. (“Soderholm”), Vicinity’s Pacific Islands distributor.
- Secured distributions agreements for Vicinity’s vehicle portfolio with:
- The TOK Group, a Canadian transportation solutions provider, to offer the Company’s VMC 1200 class 3 electric trucks.
- Schetky Bus and Van Sales, a dealership and transportation solutions provider in the Northwestern U.S., which will offer the Vicinity LightningTM, Vicinity Classic and VMC-Optimal vehicles, including an initial commitment for 18 vehicles.
- Fortified the Company’s balance sheet subsequent to the end of the third quarter, opportunistically raising US$4.8 million utilizing the Company’s at-the-market (“ATM”) program.
“The third quarter of 2022 was highlighted by strong momentum in our VMC 1200 Class 3 electric truck and Vicinity Lightning™ electric bus product lines – all propelled by intense customer demand for commercial EVs,” said William Trainer, Founder and Chief Executive Officer of Vicinity Motor Corp. “Our recent US$100+ million purchase order for 1,000 VMC 1200 vehicles from Pioneer Auto Group was a transformational milestone in Vicinity’s evolution as a leading commercial EV manufacturer. The order validates the years of innovation and development we have invested in, all with the goal of expanding our capabilities beyond our strong legacy in transit buses and into the vast commercial truck market. Taken together, our backlog grew to over USD$190 million, the vast majority of which are for electric vehicles.
“Our VMC 1200 supply chain is fairly insulated from the global supply chain disruptions that have impacted our transit bus business – which pushed the delivery of many bus orders into 2023. Initial VMC 1200 deliveries began in November and we expect these sales to gradually ramp up to meet the immense demand we are seeing for this product line. Our first vehicles will be assembled in British Columbia, Canada – and now that we have sourced a solution to the power switch issue we faced previously – we believe that our new Ferndale, Washington facility will begin to supplement our Canadian assembly capabilities in the first quarter 2023. To support these growing production goals, we are currently working on increasing our credit facilities to support the short-term working capital requirements of the rapidly ramping VMC 1200 production.
“Looking ahead to 2023, we are incredibly well positioned for success – particularly as supply chains normalize and we can resume full-fledged transit bus production. Given the VMC 1200 doesn’t face the same supply chain pressures that transit buses do – paired with the significant incentives and subsidies available to end-users seeking to electrify their fleets – we expect they will prove to be a significant contributor to our revenue growth and profitability. I look forward to continuing to update our investors as we build the foundation for what I believe will be a record 2023,” concluded Trainer.
Third Quarter 2022 Financial Results
All figures stated in this press release are in U.S. dollars unless stated otherwise.
Revenue totaled $1.5 million in the third quarter of 2022, as compared to $2.3 million in the same year-ago quarter. Revenue totaled $16.4 million for the nine months ended September 30, 2022, as compared to $39.4 million in the nine months ended September 30, 2021. The decrease is primarily attributable to lower vehicle deliveries due to global supply chain disruptions.
Gross loss in the quarter ended September 30, 2022 totaled $0.2 million, or 15% of revenue, as compared to $0.6 million, or 25% of revenue, for the quarter ended September 30, 2021. Gross profit totaled $1.0 million, or 6% of revenue for the nine months ended September 30, 2022, as compared to gross profit of $4.6 million, or 12% of revenue for the nine months ended September 30, 2021. Gross margins were affected by product mix and the low volume of buses delivered, with global supply chain disruptions affecting certain transit bus components continuing to delay deliveries.
Cash used in operating activities in the nine months ended September 30, 2022 totaled $5.2 million, as compared to cash provided by operating activities of $7.8 million in the nine months ended September 30, 2021.
Net loss in the quarter ended September 30, 2022 was $7.4 million, or $(0.19) per share, as compared to a net loss of $3.8 million, or ($0.13) per share, in the third quarter of 2021. Net loss for the nine months ended September 30, 2022 was $14.1 million, as compared to net loss of $2.5 million for the nine months ended September 30, 2021.
Adjusted EBITDA loss for the three months ended September 30, 2022 was $2.7 million, as compared to an adjusted EBITDA loss of $2.8 million for the three months ended September 30, 2021. Adjusted EBITDA loss for the nine months ended September 30, 2022 was $6.0 million, as compared to an adjusted EBITDA loss of $0.5 million for the nine months ended September 30, 2021.
Cash and cash equivalents as of September 30, 2022 totaled $1.1 million, as compared to $4.4 million as of December 31, 2021. Subsequent to the end of the third quarter, the Company fortified its balance sheet through an opportunistic US$4.8 million raise utilizing the Company’s at-the-market (“ATM”) program.
Third Quarter 2022 Results Conference Call
Management will host an investor conference call at 4:30 p.m. Eastern time today to discuss Vicinity Motors’ third quarter financial results, provide a corporate update, and conclude with a question and answer session from telephone participants. To participate, please use the following information:
Q3 2022 Conference Call and Webcast
Date: Tuesday, November 15, 2022
Time: 4:30 p.m. Eastern time
U.S./Canada Dial-in: 1-844-850-0545
International Dial-in: 1-412-542-4118
Conference ID: 10173008
Webcast: Vicinity Motors Q3 2022 Webcast
Please dial in at least 10 minutes before the start of the call to ensure timely participation.
A playback of the call will be available through Thursday, December 15, 2022. To listen, call 1-844-512-2921 within the United States and Canada or 1-412-317-6671 when calling internationally. Please use the replay pin number 10169971. A webcast will also be available by clicking here: Vicinity Motors Q3 2022 Webcast.
About Vicinity Motor Corp.
Vicinity Motor Corp. (NASDAQ:VEV)(TSXV:VMC)(FRA:6LGA) is a North American supplier of electric vehicles for both public and commercial enterprise use. The Company leverages a dealer network and close relationships with world-class manufacturing partners to supply its flagship electric, CNG and clean-diesel Vicinity buses, the VMC 1200 electric truck and a VMC Optimal-EV shuttle bus. For more information, please visit www.vicinitymotorcorp.com.
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