Workhorse Group Reports Sales for the First Quarter Ended March 31, 2017
CINCINNATI, May 10, 2017 /PRNewswire/ -- Workhorse Group Inc. (NASDAQ: WKHS), a technology company focused on providing sustainable and cost-effective solutions to the commercial transportation sector and an American manufacturer, that designs and builds high performance battery-electric electric vehicles and aircraft that make movement of people and goods more efficient and less harmful to the environment, today announced its financial results for the first quarter of 2017.
QUARTERLY SUMMARY and HIGHLIGHTS
- Completed Delivery of UPS's 125-unit order (35 E-GEN units delivered)
- Q4/2016 vs. Q1/2017 revenue was down by $1,260,163
- Q1/2016 vs. Q1/2017 revenue was up by $1,542,307
- Preparation began for assembly of 218 units for Q2/Q3 2017 delivery
- Concept W-15 Pickup Truck unveiled on May 2, 2017
- 2,150 W-15 units under letter-of-intent received by 3/31/17 grown to 4,650 received by 5/1/17
- First DOE/FedEx Hydrogen Fuel Cell Chassis delivered to Plug Power
- Two Workhorse E-GEN vehicles placed on-route by a large parcel delivery company
- UPS conducted a successful real world test using our electric truck-based autonomous UAV delivery system
- Completed a $22.4 million equity financing
Sales for the first quarter ended March 31, 2017 were $1.7 million in sales and delivery of their battery-electric Workhorse vehicles this quarter. The vehicles delivered were the range-extended Workhorse E-GEN.
Steve Burns, Chief Executive Officer, commented, "As we continue to deliver our battery-electric medium-duty trucks to our customers, we are experiencing a wide adoption of this innovative technology that we believe will transform the industry. We will continue to ramp up production and execute delivery of customer orders on a fast pace and we are receiving great feedback and accolades for our product's efficiency and user experience."
Gross margin was negative $2.5 million for the quarter. As we increase volume, we are starting to get volume pricing from our suppliers, continuing to engineer out costs and achieving manufacturing efficiencies so we are on track to profitability faster than anticipated. Research and Development for the quarter were $3.2 million higher than last year due to an added focus on the US Postal Service's Next Generation Delivery Vehicles (NGVD) project, and for building the W-15 pickup truck and the multi-copter prototypes.
Cash used from operation year to date was $13 million used for working capital, including inventory purchases for our current backlog and R&D expenses primarily related to the USPS Next Generation Delivery Vehicle project and the W-15 pickup truck. On the financing activities, we received funds from a stock public offering ($20.5 million net).
Forward Looking Statements
This press release includes forward-looking statements. These statements are made under the "safe harbor" provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements may be identified by words such as "believes," "expects," "anticipates," "estimates," "projects," "intends," "should," "seeks," "future," "continue," or the negative of such terms, or other comparable terminology. 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 herein. Factors that could cause actual results to differ materially include, but are not limited to: our limited operations and need to expand in the near future to fulfill product orders; risks associated with obtaining orders and executing upon such orders; the ability to protect our intellectual property; the potential lack of market acceptance of our products; potential competition; our inability to retain key members of our management team; our inability to raise additional capital to fund our operations and business plan; our inability to maintain our listing of our securities on the Nasdaq Capital Market; our ability to continue as a going concern; our liquidity and other risks and uncertainties and other factors discussed from time to time in our filings with the Securities and Exchange Commission ("SEC"), including our annual report on Form 10-K filed with the SEC. Workhorse expressly disclaims any obligation to publicly update any forward-looking statements contained herein, whether as a result of new information, future events or otherwise, except as required by law.
About Workhorse Group
Workhorse Group Inc. is a technology company focused on providing sustainable and cost-effective solutions to the commercial transportation sector. As an American manufacturer, we design and build high performance battery-electric electric vehicles and aircraft that make movement of people and goods more efficient and less harmful to the environment. As part of our solution, we also develop cloud-based, real-time telematics performance monitoring systems that enable fleet operators to optimize energy and route efficiency. For additional information visit www.workhorse.com
| Workhorse Group, Inc. |
||
| Consolidated Statements of Operations |
||
| For the Three Months Ended March 31, 2017 and 2016 |
||
| (Unaudited) |
||
| 2017 |
2016 |
|
| Sales |
$ 1,778,037 |
$ 236,000 |
| Cost of Sales |
$ 4,312,088 |
464,377 |
| Gross loss |
$ (2,534,051) |
(228,377) |
| Operating Expenses |
||
| Selling, general and administrative |
$ 2,107,582 |
1,170,992 |
| Research and development |
$ 3,243,322 |
2,940,940 |
| Total operating expenses |
$ 5,350,904 |
4,111,932 |
| Interest expense, net |
$ 35,651 |
39,703 |
| Net loss |
$ (7,920,606) |
$ (4,380,012) |
| Basic and diluted loss per share |
$ (0.24) |
$ (0.20) |
| Weighted average number of common |
||
| shares outstanding |
32,965,419 |
21,580,604 |
| Workhorse Group, Inc. |
||
| Consolidated Balance Sheets |
||
| March, 31 2017 Unaudited and December 31, 2016 |
||
| March 31, 2017 |
December 31, 2016 |
|
| Assets |
||
| Current assets: |
||
| Cash and cash equivalents |
$ 10,240,895 |
$ 469,570 |
| Accounts receivable |
978,000 |
628,700 |
| Lease receivable current |
95,096 |
98,400 |
| Inventory |
5,067,487 |
2,464,835 |
| Prepaid expenses and deposits |
1,533,537 |
255,163 |
| 17,915,015 |
3,916,668 |
|
| Property, plant and equipment, net |
5,895,372 |
6,002,631 |
| Lease receivable long-term |
213,080 |
320,494 |
| $ 24,023,467 |
$ 10,239,793 |
|
| Liabilities and Stockholders' Equity (Deficit) |
||
| Current liabilities: |
||
| Accounts payable |
$ 2,618,499 |
$ 3,923,758 |
| Accounts payable, related parties |
24,097 |
101,339 |
| Shareholder advances |
- |
229,772 |
| Current portion of long-term debt |
80,003 |
79,521 |
| 2,722,599 |
4,334,390 |
|
| Long-term debt |
2,083,159 |
2,088,429 |
| Stockholders' equity (deficit): |
||
| Series A preferred stock, par value of $.001 per share 75,000,000 shares |
||
| authorized, 0 shares issued and outstanding at June 30, 2016 |
||
| and December 31, 2015 |
- |
- |
| Common stock, par value of $.001 per share 50,000,000 shares authorized, |
||
| 35,956,800 shares issued and outstanding at March 31, 2017 and |
||
| 27,578,864 shares issued and outstanding at December 31, 2016 |
35,956 |
27,579 |
| Additional paid-in capital |
90,175,572 |
66,862,608 |
| Accumulated deficit |
(70,993,819) |
(63,073,213) |
| 19,217,709 |
3,816,974 |
|
| $ 24,023,467 |
$ 10,239,793 |
|
| Workhorse Group, Inc. |
||
| Consolidated Statements of Cash Flows |
||
| For the Three Months Ended March 31, 2017 and 2016 |
||
| (Unaudited) |
||
| 2017 |
2016 |
|
| Cash flows from operating activities: |
||
| Net loss |
$ (7,920,606) |
$ (4,380,012) |
| Adjustments to reconcile net loss from operations |
||
| to cash used by operations: |
||
| Depreciation |
143,142 |
93,469 |
| Stock based compensation |
327,262 |
233,057 |
| Write down of inventory |
- |
78,917 |
| Effects of changes in operating assets and liabilities: |
- |
- |
| Accounts receivable |
(349,300) |
(20,000) |
| Inventory |
(2,602,652) |
- |
| Prepaid expenses and deposits |
(1,278,374) |
(94,808) |
| Accounts payable |
(1,278,532) |
908,671 |
| Accounts payable, related parties |
(77,242) |
(213,618) |
| Net cash used by operations |
(13,036,302) |
(3,394,324) |
| Cash flows from investing activities: |
||
| Capital expenditures |
(35,883) |
(28,899) |
| Proceeds on sale of assets |
110,718 |
|
| Net cash used by investing activities |
74,835 |
(28,899) |
| Cash flows from financing activities: |
||
| Proceeds from notes payable |
- |
- |
| Payments on long-term debt |
(4,788) |
(2,722,500) |
| Shareholder advances, net of repayments |
- |
1,575,500 |
| Issuance of common and preferred stock |
22,485,999 |
- |
| Exercise of warrants and options |
251,581 |
2,110,000 |
| Net cash provided by financing activities |
22,732,792 |
963,000 |
| Change in cash and cash equivalents |
9,771,325 |
(2,460,223) |
| Cash at the beginning of the period |
469,570 |
7,677,163 |
| Cash at the end of the period |
10,240,895 |
5,216,940 |
SOURCE Workhorse Group Inc.
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