Workhorse Group Inc. (Nasdaq: WKHS)
(“Workhorse” or “the Company”), an American technology
company focused on pioneering the transition to zero-emission
commercial vehicles, today reported financial results for the
fourth quarter and full year ended December 31, 2023.
Management Commentary
“Over the past year, we have advanced our product roadmap and
navigated challenges that slowed, but never stopped, our progress,”
said Workhorse CEO Rick Dauch. “Among the highlights of the year,
we rolled out our first W56 step van, secured our first W56 fleet
customers, and increased our production capabilities for our W4 CC
and W750 vehicles. We also expanded our commercial network, adding
key dealers and partners in multiple states.”
Mr. Dauch continued, “This is an important time for Workhorse,
and we are taking critical steps to strengthen our financial
position. We are in the process of negotiating with financing
sources for a transaction that would make liquidity available both
in the short term and over time. Such a financing, in combination
with our intended Union City sale/leaseback transaction and
aggressive cost reduction actions across the organization, should
provide a financial runway to execute our plans for 2024. As part
of our cost-saving actions, we have made the decision to transition
the Aero business to a less capital-intensive Drones-as-a-Service
model. We are also reducing headcount significantly across the rest
of our organization. I’m incredibly proud of the Workhorse team and
grateful for the contributions of all our employees, including
those whose jobs are impacted by the difficult but necessary
actions we are taking.”Mr. Dauch concluded, “I remain optimistic
about the future of Workhorse. Recent dealer and fleet operator W56
demonstrations and feedback have reinforced our belief in the
potential of our commercial EV trucks. We are committed to our
mission and will continue taking decisive steps to win in the
market and drive value for our shareholders.”
Executing Strategic Commercial Vehicle Product
Roadmap
Workhorse continued to advance its strategic product roadmap for
its commercial EV delivery offerings.
- W56: Workhorse received final HVIP
certification approval of the W56 step van in Q4 2023, the final,
critical milestone to delivering these vehicles to the important
California market in advance of the Advanced Clean Fleet
regulation. The Company continued production and received its first
two 15-vehicle fleet orders for the W56, which are expected to be
delivered later in 2024. Workhorse also intends to introduce a
longer-wheelbase version of the W56 in 2024. The Company has
multiple demonstrations already underway or set to begin in early
2024 with several large last-mile fleet operators as well as state
and municipal fleets and other fleet operators.
- W4 CC/W750: The Company has stabilized
production of both W4 CC and W750 models. Dealer programs and field
demonstrations continue for both vehicles. Workhorse successfully
overcame unexpected issues with California’s HVIP program and
worked with the California Air Resources Board to list the W4 CC
and W750 with HVIP in a first-of-its-kind program for intermediate
vehicle manufacturers by demonstrating the strength of service,
warranty and delivery network, and complete care options for
customers purchasing any Workhorse-badged product.
- Continued Build Out of Commercial Dealer and Service
Footprint: Workhorse successfully added new certified
dealers to its network in 2023, expanding to 11 dealers nationwide.
Within the past two months, the Company also announced partnerships
with both W.W. Williams and Zeem Solutions to expand service and
support coverage options for Workhorse customers.
- Completed Revamp of Manufacturing Complex: In
2023, the Company completed the overhaul of its Union City, Indiana
manufacturing complex. The “Workhorse Ranch” is now capable of
building and painting more than 5,000 vehicles per year on one
shift. The Company’s lean, highly flexible production facility can
ramp up staffing and production in-line with market demand. In Q1
2024, the Company entered into a non-binding purchase and sale
agreement arrangement with a third party for the sale and leaseback
of its Union City manufacturing complex to strengthen its financial
position. The Company continues to support the activities of the
purchaser and intends to close in May 2024.
- Stables by Workhorse: In 2023, the Company
continued to electrify its fleet of delivery vehicles being used to
operate Stables by Workhorse, a series of FedEx Ground delivery
routes in the greater Cincinnati, Ohio area. The Company now has
seven Class 4 EV units in the delivery fleet and expects the entire
fleet to be electrified in 2024 with the first W56 step vans coming
into service during Q1 2024.
Aero
In the first quarter of 2024, the Company decided to suspend
drone design and manufacturing and to exclusively focus on
Drones-as-a-Service (“DaaS”) business. The Company further
developed the DaaS business in 2023, and in 2024, has continued to
win additional grant awards from the USDA to support the National
Resources Conservation Service. In January, Workhorse received a
$500,000 grant and in February, received a separate $350,000 grant
to provide actionable data from sensor scanning to increase the
efficiency of underserved farmers’ and ranchers’ land use.
Fourth Quarter 2023 Financial Results
Sales, net of returns and allowances, for the fourth quarter of
2023 were $4.4 million compared to $3.4 million in the same period
last year. The increase was primarily due to increased vehicle
sales as well as Stables by Workhorse and DaaS revenue
contributions.
Cost of sales decreased to $18.1 million from $21.2 million in
the same period last year, primarily driven by a reduction in
disposal costs for the discontinued C1000 program.
Selling, general and administrative (“SG&A”) expenses
increased to $15.1 million from $13.5 million in the same period
last year. The increase in SG&A expenses was primarily driven
by increased legal and professional fees.
Research and development (“R&D”) expenses decreased to $6.4
million compared to $8.0 million in the same period last year. The
decrease in R&D expenses was primarily due to reduced
consulting and prototype costs as the Company started production of
the W4 CC, W750 and W56 vehicles.
Net interest expense was $10.2 million compared to net interest
income of $0.5 million in 2022. Net interest expense in 2023 was
driven by a fair value adjustment of our convertible notes and
warrants, and fees paid in connection with the previously disclosed
issuance of a $20 million green senior secured convertible note and
the equity line of credit purchase agreement. Net interest income
in 2022 was primarily driven by interest payments on the Company’s
money market investment account.
Net loss was $45.3 million compared to $38.7 million in the same
period last year.
As of December 31, 2023, the Company had $ 25.8 million in cash
and cash equivalents, as well as restricted cash balance of $10.0
million.
Full Year 2023 Financial Results
Sales increased $8.1 million to $13.1 million for the full year
2023 compared to $5.0 million in 2022, primarily resulting from an
increase in W4 CC sales volumes. The W750 and W56 products, which
launched in 2023, as well as Stables by Workhorse, and the
Company’s DaaS offering also contributed to the increase.
Cost of sales for the full year 2023 increased $0.7 million to
$38.4 million compared to $37.7 million in 2022. The increase was
primarily due to increased production and overhead costs to support
higher sales volumes related to new vehicle platforms and an
increase in employee compensation and related expenses compared to
2022 levels. This increase was partially offset by a decrease in
inventory reserves, adjustments, and disposals, which were driven
by the disposition of C-Series inventory in 2022.
SG&A expenses for the full year 2023 were $55.6 million, a
decrease of $17.6 million compared to $73.2 million in 2022. The
decrease was driven by a $25.2 million reduction in expenses
attributable to the securities and derivative litigation
settlements and legal expenses recognized in the prior year. This
decrease was partially offset by a $3.0 million increase in
employee compensation and related expenses, including non-cash
stock-based compensation expense, a $2.1 million increase in
professional and other services expenses, and a $0.6 million
increase in corporate insurance expenses.
R&D expenses for the full year 2023 were $24.5 million, an
increase of $1.3 million compared to $23.2 million in 2022. The
increase was primarily driven by an increase of $1.4 million in
employee compensation and related expenses and a $0.8 million
increase in development expenses for new products. These increases
were partially offset by a $1.4 million decrease in consulting
expenses.
Other loss for the full year 2023 was $10.0 million compared to
other income of $13.6 million in 2022. Other loss in 2023
represented the impairment of the Company’s investment in Tropos.
Other income in 2022 represented proceeds from the sale of C-Series
inventory that was previously fully reserved.
Net interest expense for the full year 2023 was $8.7 million
compared to $1.8 million in 2022. Net interest expense in 2023 was
driven by a fair value adjustment of our convertible notes and
warrants, and fees paid in connection with the previously disclosed
issuance of a $20 million green senior secured convertible note and
the equity line of credit purchase agreement, offset by interest
earned on cash balances in the Company’s money market investment
account. Net interest expense in 2022 was primarily related to fair
value adjustments, contractual interest expense, and loss on
conversion of former convertible notes, which were exchanged for
shares of common stock during 2022.
For the years ended December 31, 2023 and 2022, the Company
incurred taxable losses and thus no provisions for income tax
expense have been recorded.
Net loss for the full year 2023 was $123.9 million compared to a
net loss of $117.3 million in 2022. Loss from operations for the
full year 2023 was $105.3 million compared to $129.1 million in
2022.
Strengthening Workhorse’s Financial
Position
As the Company recently disclosed, it is negotiating with
financing sources for a transaction that would provide a financial
runway for the business to execute on its plans. The Company
intends to consummate such a transaction in the near future.
Workhorse is also taking steps to aggressively cut costs across
the organization to ensure it can deliver for its customers and
stakeholders. These steps include:
- In the process of completing a reduction in force (the “RIF”)
pursuant to which approximately 20% of the total workforce,
excluding direct labor, was terminated in addition to Aero
reductions as well. The Company does not expect to incur material
costs in connection with the RIF.
- Each executive officer agreed to defer payment of 20% of their
cash compensation for at least the next three months.
- Transitioning the Aero business from a design and manufacturing
drone business to DaaS model. This transition has resulted in,
among other things, stopping production and development of both
drone product lines and the termination of employees who performed
the related work.
2024 Overview
“Workhorse is entering 2024 with strong production and delivery
capabilities as well as a keen focus on financial discipline and
cost control,” said Workhorse CFO Bob Ginnan. “As we speak, we are
working hard to resolve our short-term liquidity issues described
in our 10-K. Over the year, we will maintain our focus on
operational excellence and cost reduction as we increase production
and expand delivery of our commercial vehicles to meet our
financial targets for 2024. At the same time, we will continue to
evaluate opportunities to strengthen our financial position and
ensure we have the runway to achieve our goals. Given the number of
key customer demonstrations underway in Q1 2024, we will report on
our progress when it occurs, and, as a result, will not be
providing specific annual revenue or unit guidance at this
time.”
Conference Call
Workhorse management will hold a conference call today, March
12, 2024 at 12:00 p.m. Eastern time (9:00 a.m. Pacific time) to
discuss these results and answer related questions.
U.S. dial-in: 877-407-8289International dial-in:
201-689-8341
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 3:00 p.m. Eastern time on the same day through March 19,
2024.
Toll-free replay number: 877-660-6853International replay
number: 201-612-7415Replay ID: 13744384
Annual Meeting of Stockholders
The Company also announced that its Annual Meeting of
Stockholders will take place on May 14, 2024, with a record date of
March 15, 2024.
About Workhorse Group Inc.
Workhorse is a technology company focused on providing ground
and air-based electric vehicles to the last-mile delivery sector.
As an American original equipment manufacturer, we design and build
high performance, battery-electric trucks and drones. 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
The discussions in this press release contain forward-looking
statements reflecting our current expectations that involve risks
and uncertainties. These statements are made under the “safe
harbor” provisions of the U.S. Private Securities Litigation Reform
Act of 1995. When used in this Report, the words “anticipate,”
“expect,” “plan,” “believe,” “seek,” “estimate” and similar
expressions are intended to identify forward-looking statements.
These are statements that relate to future periods and include, but
are not limited to, statements about the features, benefits and
performance of our products, our ability to introduce new product
offerings and increase revenue from existing products, expected
expenses including those related to selling and marketing, product
development and general and administrative, our beliefs regarding
the health and growth of the market for our products, anticipated
increase in our customer base, expansion of our products
functionalities, expected revenue levels and sources of revenue,
expected impact, if any, of legal proceedings, the adequacy of our
liquidity and capital resources, the likelihood of us obtaining
additional financing in the immediate future and the expected terms
of such financing, and expected growth in business. Forward-looking
statements are statements that are not historical facts. Such
forward-looking statements are subject to risks and uncertainties,
which could cause actual results to differ materially from the
forward-looking statements contained in this Report. Factors that
could cause actual results to differ materially include, but are
not limited to: our ability to develop and manufacture our new
product portfolio, including the W4 CC, W750, W56 and WNext
programs; our ability to attract and retain customers for our
existing and new products; risks associated with obtaining orders
and executing upon such orders; the unavailability, reduction,
elimination or adverse application of government subsidies,
incentives and regulations; supply chain disruptions, including
constraints on steel, semiconductors and other material inputs and
resulting cost increases impacting our Company, our customers, our
suppliers or the industry; our ability to capitalize on
opportunities to deliver products to meet customer requirements;
our limited operations and need to expand and enhance elements of
our production process to fulfill product orders; our general
inability to raise additional capital to fund our operations and
business plan; our ability to obtain financing to meet our
immediate liquidity needs and the potential costs, dilution and
restrictions imposed by any such financing; our ability to regain
compliance with the listing requirements of the Nasdaq Capital
Market and otherwise maintain the listing of our securities thereon
and the impact of any steps we take to regain such compliance, such
as a reverse split of our common stock, on our operations, stock
price and future access to liquidity; our ability to protect our
intellectual property; market acceptance for our products; our
ability to obtain sufficient liquidity from operations and
financing activities to continue as a going concern and, our
ability to control our expenses; the effectiveness of our cost
control measures and impact such measures could have on our
operations; potential competition, including without limitation
shifts in technology; volatility in and deterioration of national
and international capital markets and economic conditions; global
and local business conditions; acts of war (including without
limitation the conflicts in Ukraine and Israel) and/or terrorism;
the prices being charged by our competitors; our inability to
retain key members of our management team; our inability to satisfy
our customer warranty claims; the outcome of any regulatory or
legal proceedings; and other risks and uncertainties and other
factors discussed from time to time in our filings with the
Securities and Exchange Commission (“SEC”), including under the
“Risk Factors” section of our annual report on Form 10-K filed with
the SEC. Forward-looking statements speak only as of the date
hereof. We expressly disclaim any obligation or undertaking to
release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in our
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based,
except as required by law.
Media Contact:Aaron Palash / Greg KlassenJoele
Frank, Wilkinson Brimmer Katcher212-355-4449
Investor Relations Contact:Matt Glover and Tom
ColtonGateway Investor
Relations949-574-3860WKHS@gateway-grp.com
Workhorse Group Inc. |
Consolidated Balance Sheets |
|
|
December 31, |
|
2023 |
|
2022 |
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
$ |
25,845,915 |
|
|
$ |
99,276,301 |
|
Restricted cash |
|
10,000,000 |
|
|
|
— |
|
Accounts receivable, less allowance for credit losses of
$0.2 million and zero at December 31, 2023 and 2022,
respectively |
|
4,470,209 |
|
|
|
2,079,343 |
|
Other receivable |
|
— |
|
|
|
15,000,000 |
|
Inventory, net |
|
45,408,192 |
|
|
|
8,850,142 |
|
Prepaid expenses and other current assets |
|
8,101,162 |
|
|
|
14,152,481 |
|
Total current assets |
|
93,825,478 |
|
|
|
139,358,267 |
|
Property, plant and equipment,
net |
|
37,876,955 |
|
|
|
21,501,095 |
|
Investment in Tropos |
|
— |
|
|
|
10,000,000 |
|
Lease right-of-use assets |
|
9,795,981 |
|
|
|
11,706,803 |
|
Other assets |
|
176,310 |
|
|
|
176,310 |
|
Total Assets |
$ |
141,674,724 |
|
|
$ |
182,742,475 |
|
Liabilities |
|
|
|
Current liabilities: |
|
|
|
Accounts payable |
$ |
12,456,272 |
|
|
$ |
10,235,345 |
|
Accrued liabilities and other |
|
4,862,740 |
|
|
|
46,207,431 |
|
Deferred revenue, current |
|
4,714,331 |
|
|
|
3,375,000 |
|
Warranty liability |
|
1,902,647 |
|
|
|
2,207,674 |
|
Current portion of lease liability |
|
3,560,612 |
|
|
|
1,285,032 |
|
Warrant liability |
|
5,605,325 |
|
|
|
— |
|
Current portion of convertible notes |
|
20,180,100 |
|
|
|
— |
|
Total current liabilities |
|
53,282,027 |
|
|
|
63,310,482 |
|
Deferred revenue,
long-term |
|
— |
|
|
|
2,005,000 |
|
Lease liability,
long-term |
|
5,280,526 |
|
|
|
8,840,062 |
|
Total Liabilities |
|
58,562,553 |
|
|
|
74,155,544 |
|
Commitments and
contingencies |
|
|
|
Stockholders’
Equity |
|
|
|
Series A preferred stock, par value of $0.001 per share, 75,000,000
shares authorized, zero shares issued and outstanding at December
31, 2023 and 2022 |
|
— |
|
|
|
— |
|
Common stock, par value of $0.001 per share, 450,000,000 and
250,000,000 shares authorized, 285,980,843 and 165,605,355 shares
issued and outstanding at December 31, 2023 and 2022,
respectively |
|
285,981 |
|
|
|
165,605 |
|
Additional paid-in capital |
|
834,394,441 |
|
|
|
736,070,388 |
|
Accumulated deficit |
|
(751,568,251 |
) |
|
|
(627,649,062 |
) |
Total stockholders' equity |
|
83,112,171 |
|
|
|
108,586,931 |
|
Total Liabilities and Stockholders' Equity |
$ |
141,674,724 |
|
|
$ |
182,742,475 |
|
Workhorse Group Inc. |
Consolidated Statements of Operations |
|
|
For the Years Ended December 31, |
|
2023 |
|
2022 |
Sales, net of returns and allowances |
$ |
13,094,752 |
|
|
$ |
5,023,072 |
|
Cost of sales |
|
38,350,545 |
|
|
|
37,672,308 |
|
Gross loss |
|
(25,255,793 |
) |
|
|
(32,649,236 |
) |
Operating expenses |
|
|
|
Selling, general and administrative |
|
55,574,740 |
|
|
|
73,220,088 |
|
Research and development |
|
24,467,933 |
|
|
|
23,213,540 |
|
Total operating expenses |
|
80,042,673 |
|
|
|
96,433,628 |
|
Loss from operations |
|
(105,298,466 |
) |
|
|
(129,082,864 |
) |
Interest expense, net |
|
(8,731,247 |
) |
|
|
(1,837,882 |
) |
Other (loss) income |
|
(10,000,000 |
) |
|
|
13,646,528 |
|
Loss before income taxes |
|
(124,029,713 |
) |
|
|
(117,274,218 |
) |
Benefit from income taxes |
|
(110,524 |
) |
|
|
— |
|
Net loss |
$ |
(123,919,189 |
) |
|
$ |
(117,274,218 |
) |
|
|
|
|
Net loss per share of common
stock |
|
|
|
Basic & Diluted |
$ |
(0.60 |
) |
|
$ |
(0.74 |
) |
|
|
|
|
Weighted average shares used
in computing net loss per share of common stock |
|
|
|
Basic & Diluted |
|
207,293,249 |
|
|
|
158,576,305 |
|
Workhorse (NASDAQ:WKHS)
過去 株価チャート
から 4 2024 まで 5 2024
Workhorse (NASDAQ:WKHS)
過去 株価チャート
から 5 2023 まで 5 2024