CALGARY,
AB, May 15, 2024 /CNW/ - Exro
Technologies Inc. (TSX: EXRO) (OTCQB: EXROF) (the
"Company" or "Exro"), a leading clean-technology
company that provides proprietary motor-control and complete
electric propulsion system technology for e-mobility, is excited to
provide its first update highlighting the Company's transformative
shifts following the acquisition of SEA Electric on April 5th, 2024, and announces the release of
results for the three months ended March 31,
2024. With the strategic acquisition completed, Exro
navigates the integration with focus on the next twelve months'
strong growth prospects.
"The progress made since April
5th is a validation to the deal synergies
presented in January – Revenue, cost savings and complementary
technologies," said Exro CEO Sue
Ozdemir. "Immediately upon closing of the deal we began
initial SEA-Drive® propulsion system deliveries to key OEM
customers, and launched a broad-based integration process focused
on significant cost reduction and operational execution for
critical customers and programs. We have also identified
opportunities within supply chain and operations to further gain
efficiencies and reduce cost as we continue to merge and integrate
our Coil Driver™ technology into our blue-chip partnerships. We are
steadily ramping our output and expect deliveries of over 250
propulsion systems within the first six months post-close and more
than 1,000 systems in the 12 months post-close. The combination of
Exro's Coil Driver™ inverter with the SEA-Drive® propulsion system
provides the industry with a patented and proven solution to bridge
the cost-performance gap. We remain committed to our vision and
innovation in motor and battery control."
Operational Update
Exro proactively shifted strategies with the acquisition of SEA
Electric to create a larger technology company with immediate
significant revenue growth and line of sight to profitability,
uniquely positioned to be a leader in the electrification
transition. The acquisition brings together complementary
technologies, poised to address the evolving needs of the
commercial EV market segment, which shows a pronounced readiness
for electrification driven by regulatory mandates and environmental
imperatives. With industry-leading propulsion technology, equipped
with Exro's Coil Driver™, the combined entity is well-positioned to
cater to both short-term demands and long-term differentiation in
the industry. Furthermore, the acquisition brought blue-chip OEM
customers, providing a robust platform to grow and demonstrate our
proven technologies.
During the first quarter of 2024, Exro's attention was focused
both on completing the SEA Electric acquisition, and its continued
commitment to driving profitable revenue growth. Notably, Exro
successfully delivered Coil Driver™ units to HB4, Giaffone, and
Vicinity Motors and concurrently continued the e-Axle program with
Linamar. The Company also continued to advance through the second
phase of its innovation program with its leading global passenger
vehicle NDA OEM partner where the
program will reduce the need for rare-earth metals in electric
motors, driving unparalleled sustainability in e-mobility.
The closing of the SEA Electric acquisition marked a leap
forward in Exro's mission to utilize minimum energy for maximum
results and to expand the boundaries of control in e-mobility. In
conjunction with the acquisition, management outlined the key areas
to build the foundation of the Company's future growth. Below is an
update on these focus areas in the first month for the newly
combined entity:
- Revenue: A steady ramp in deliveries with our
blue-chip OEM customers will result in strong revenue growth in
2024 and beyond. The newly combined entity provides a combination
of complementary skills and experience and has already demonstrated
improved operational results. The Company remains committed to
delivering over 250 propulsion systems during the first six months
post-close and is executing a plan to achieve cash flow positive by
Q2 2025.
- Costs: Exro is implementing rigorous team integration
and cost cutting measures which target an annualized reduction in
General & Administrative expenses of up to US$10 million in 2024. Since April 5th, Exro has already recognized
an initial US$5 million in annualized
savings through redundancies, supply chain efficiencies, and
optimized business operations. The Company has a plan in place to
deliver further savings through facilities rationalization, a focus
on execution, and continued operational optimization. The Company
anticipates additional efficiencies to be realized and aligned with
a targeted path to profitability by Q2 2025. In line with this,
Exro is also currently in late-stage discussions with financial
institutions to secure non-dilutive working capital that will
further support its accelerated growth. These discussions reflect
the company's commitment to strategically fortifying its financial
infrastructure to seize emerging opportunities and drive sustained
expansion.
- Technology: Exro is engaged in technical review
discussions with its industry-leading OEM partners to integrate our
Coil Driver™ inverters into core propulsion systems. These
discussions include existing platforms currently being delivered as
well as new programs being developed. Validating our initial
acquisition strategic rational, it is anticipated that Coil
DriverTM pilots will begin with these partners in Q3
2024, bringing higher performance and lower costs which would
support a future where the Coil DriverTM inverter
becomes a core component of all existing SEA-Drive® propulsion
system agreements.
Exro's innovation program with its leading
global passenger vehicle automotive OEM under NDA continues to
progress well through phase two, which includes deliveries of Coil
DriverTM prototypes with optimized OEM partner's motor
in 2024. The intent of this innovation program is to demonstrate
the Coil Driver'sTM industry disruptive ability to
reduce dependency of rare-earth metals in electric motors. This
ability has also attracted the attention of other major global
automotive OEMs. Exro is optimistic that ongoing discussions with
these additional OEMs will lead to a second OEM innovation program
announcement by the end of Q3 2024.
Exro remains on track for UL certification of
its Cell Driver™ stationary energy storage system in Q2 2024,
further enhancing its product portfolio and market
competitiveness.
First Quarter 2024 Financial Highlights
The following is a summary from the Company's consolidated
interim financial statements and Management's Discussion and
Analysis for the quarter ended March
31, 2024. All dollar figures are in Canadian
dollars.
For the three
months
ended
|
Revenue
|
Net
loss
|
Basic and
diluted
loss per common
share
|
Weighted average
number of common
shares
|
March 31,
2024
|
$1,263,211
|
$(12,867,234)
|
$(0.08)
|
170,077,862
|
March 31,
2023
|
$324,769
|
$(8,163,404)
|
$(0.05)
|
149,820,687
|
Through Q1 2024, Exro began to reposition its business and
operations in preparation for the acquisition of SEA in Q2 2024.
Coil Driver™ orders were filled and delivered on time for
low-volume commitments by HB4, Vicinity Motors, and Giaffone, while
Cell Driver™ progressed through final testing requirements towards
UL certification.
For the three months ended March 31,
2024, the Company saw revenue generated of $1,263,211 driven by pilot Coil Driver™ unit
sales and engineering services agreements completed during the
quarter. While the Company incurred a net loss of $12,867,234 in Q1 2024, the loss was down from
$18,769,546 for the three months
ended December 31, 2023, and in-line
with Q2 2023. Included in the Q1 2024 operating loss are one-time
costs of $2,077,145 for transaction
costs directly related to the acquisition of SEA Electric, and a
non-cash loss on the revaluation of the Company's previously held
investment in SEA Electric of $903,238. These items did not exist in the
comparative period, which would have otherwise equated to a loss
in-line with Q1 2023.
The condensed consolidated interim financial statements and
Management's Discussion and Analysis for the quarter ended
March 31, 2024, from which the above
information was derived were filed on May
15, 2024, can be viewed at www.exro.com/investors or on
SEDAR under Exro Technologies Inc. at www.sedarplus.ca.
ABOUT EXRO TECHNOLOGIES INC.
Exro Technologies Inc., now expanded through the strategic
acquisition of SEA Electric, is a leading clean technology company
that has developed new generation power control electronics. Its
innovative suite of solutions, including Coil Driver™, Cell
Driver™, and SEA-Drive®, expand the capabilities of electric motors
and batteries and offer OEMs a comprehensive e-propulsion solution
with unmatched performance and efficiency. Exro is reshaping global
energy consumption, accelerating adoption towards a circular
electrified economy by delivering more with less – minimum energy
for maximum results.
For more information visit our website at www.exro.com.
To view our Corporate Presentation visit us at
www.exro.com/investors
Visit us on social media @exrotech.
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING
STATEMENTS
This news release contains forward-looking statements and
forward-looking information (together, "forward-looking
statements") within the meaning of applicable securities laws. All
statements, other than statements of historical facts, are
forward-looking statements. Generally, forward-looking statements
can be identified using terminology such as "plans", "expects",
"estimates", "intends", "anticipates", "believes" or variations of
such words, or statements that certain actions, events or results
"may", "could", "would", "might", "will be taken", "occur" or "be
achieved". Forward looking statements involve risks, uncertainties
and other factors disclosed under the heading "Risk Factors" and
elsewhere in the Company's filings with Canadian securities
regulators, that could cause actual results, performance,
prospects, and opportunities to differ materially from those
expressed or implied by such forward-looking statements. Although
the Company believes that the assumptions and factors used in
preparing these forward-looking statements are reasonable based
upon the information currently available to management as of the
date hereof, actual results and developments may differ materially
from those contemplated by these statements. Readers are therefore
cautioned not to place undue reliance on these statements, which
only apply as of the date of this news release, and no assurance
can be given that such events will occur in the disclosed times
frames or at all. Except where required by applicable law, the
Company disclaims any intention or obligation to update or revise
any forward-looking statement, whether as a result of new
information, future events or otherwise.
This information is qualified in its entirety by cautionary
statements and risk factor disclosure contained in filings made by
the Company with the Canadian securities regulators, including the
Company's annual information form for the financial year ended
December 31, 2022, and financial
statements and related MD&A for the financial year ended
December 31, 2022, filed with the
securities regulatory authorities in certain provinces of
Canada and available at
www.sedar.com. Should one or more of these risks or uncertainties
materialize, or should assumptions underlying the forward-looking
information prove incorrect, actual results may vary materially
from those described herein as intended, planned, anticipated,
believed, estimated or expected. Although the Company has attempted
to identify important risks, uncertainties and factors which could
cause actual results to differ materially, there may be others that
cause results not to be as anticipated, estimated or intended. The
Company does not intend, and does not assume any obligation, to
update this forward-looking information except as otherwise
required by applicable law.
Neither the Toronto Stock Exchange nor the Investment Industry
Regulatory Organization of Canada
accepts responsibility for the adequacy or accuracy of this press
release.
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SOURCE Exro Technologies Inc.