Vicinity motor corp. reports third quater 2021 financial results

Company: Vicinity Motor Corp(formerly Grande West Transportation )
Listings :TSXV , NASDAQ
Ticker: VMC.V & VEV
Market cap at time of publication: $179 MCAD
Stock price at time of publication: $5.20 CAD
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 cap $2400 MCAD
Website: https://vicinitymotorcorp.com/

ESGFIRE comment: We are pleased to see that the Year over year 9 month growth was 128 % ( 49,3 MCAD in 2021 compared to $21.6 million in 2020) . Although the quarterly sales dropped with 67% to $2.9 million for the three months ended September 30, 2021, as compared to $8.9 million in the three months ended September 30, 2020. This drop is not a big concern since the company has positioned themselves for massive growth in 2022 and they even seem confident that they may be able to exceed their own projections of 140 million CAD in sales for 2022!

VANCOUVER, BC, November 12, 2021 – Vicinity Motor Corp. (TSXV:VMC) (NASDAQ: VEV) (FRA:6LG)(“Vicinity Motor” or the “Company”), a North American supplier of commercial electric vehicles, today reported its financial and operational results for the third quarter of 2021.

Third Quarter 2021 and Subsequent Operational Highlights

Management Commentary

“The third quarter of 2021 was instrumental in our foundation building for 2022, having secured exciting new lines of business – namely EV chassis sales alongside EAVX and low-floor electric shuttle bus sales through our new partner Optimal-EV,” said William Trainer, Founder and Chief Executive Officer of Vicinity Motor Corp. “While revenues from our transit bus business are at times irregular and see some periods of lower deliveries as illustrated this quarter, per the financial guidance we’ve released, we are on a trajectory to realize over $140 million in revenue next year – marking what will be a record-breaking year for Vicinity by any measure.  Our entry into the high demand electric truck and electric shuttle bus market is expected to fill in the gaps for periods of lower transit bus deliveries in the future.

“We made significant moves towards fortifying our balance sheet in recent months as well to support some of these exciting new growth initiatives, supplementing our $20 million line of credit with a $10.3 million debt financing and the proceeds from a US$17 million underwritten public offering.

“Our near-term sales momentum is beginning to accelerate and given the inherent delay between a customer placing a purchase order today and the revenue realized from vehicle deliveries months later, I firmly believe that we are lining ourselves up for a strong 2022.  This creates the potential to notably exceed our financial guidance – helping to generate sustainable, long-term value for our shareholders,” concluded Trainer.

Third Quarter 2021 Financial Results

Revenue decreased 67% to $2.9 million for the three months ended September 30, 2021, as compared to $8.9 million in the three months ended September 30, 2020. The decreased revenue was primarily driven by the delivery of six buses in the quarter, as compared to 20 buses in the third quarter of 2020 – reflecting low order intake during the first nine months of the pandemic and delivery delays related to shipping delays and the global supply chain challenges for certain parts currently experienced in the industry. Revenue grew 128% to $49.3 million for the nine months ended September 30, 2021, as compared to $21.6 million in the nine months ended September 30, 2020. The Company delivered 119 buses for the nine months ended September 30, 2021, as compared to 49 buses for the nine months ended September 30, 2020.

Gross loss totaled $(0.7) million, or (24.9%) of revenue, in the third quarter of 2021, as compared to a gross profit of $0.6 million, or 6.3% of revenue, in the same year-ago quarter.  Gross profit increased to $5.7 million, or 11.6% of revenue for the nine months ended September 30, 2021, as compared to gross profit of $1.2 million, or 5.3% of revenue for the nine months ended September 30, 2020. The margins for the three months ended September 30, 2021, were negatively affected by sales of higher than average cost buses in inventory and the sales of fewer buses compared to the prior year period.  The gross profit in the nine months ended September 30, 2021, was positively affected by sales mix with 2021 deliveries generally having higher margins than those realized in 2020.

Net loss for the third quarter of 2021 was $4.8 million, or ($0.16) per share, as compared to a net loss of $1.3 million, or ($0.05) per share, in the same year-ago quarter. Net loss for the nine months ended September 30, 2021, was $3.1 million, as compared to a net loss of $3.8 million for the nine months ended September 30, 2020.

Adjusted EBITDA loss for the third quarter of 2021 was $3.5 million, as compared to an adjusted EBITDA loss of $0.7 million in the same year-ago quarter.  Adjusted EBITDA loss for the nine months ended September 30, 2021 was $0.5 million, as compared to an adjusted EBITDA loss of $2.4 million for the nine months ended September 30, 2020.

Cash and cash equivalents as of September 30, 2021 totaled $5.0 million, further fortified through the addition of $10.3 million in debt financing and the proceeds from a US$17 million public offering subsequent to quarter end. Working capital as at September 30, 2021, totaled $16.4 million, as compared to $16.7 million as of December 31, 2020.

Third Quarter 2021 Results Conference Call

Date: Friday, November 12, 2021
Time: 4:30 p.m. Eastern time
U.S./Canada Dial-in: 1-877-300-8521
International Dial-in: 1-412-317-6026
Conference ID: 10161722
Webcast: https://viavid.webcasts.com/starthere.jsp?ei=1509656&tp_key=0936465e20

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 Sunday, December 12, 2021. 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 10161722. A webcast will also be available by clicking here: Vicinity Q3 2021 Webcast.

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