Workhorse(US:WKHS)2023-03-01 19:24Financial Data and Key Metrics Changes - Sales net of returns and allowances for Q4 2022 were $3.5 million compared to a negative $2 million in Q4 2021, primarily due to increased W4 CC sales [36] - Cost of sales decreased to $21.2 million from $99.9 million in the same period last year, influenced by noncash charges related to the discontinued C1000 program [37] - Net loss for Q4 2022 was $38.6 million compared to $156.1 million in the same period last year [40] - For the full year 2022, sales net of returns and allowances were $5 million compared to a negative $0.9 million in 2021 [41] - Full year net loss was $117.3 million compared to a net loss of $401.3 million last year [47] Business Line Data and Key Metrics Changes - In Q4, the company delivered 23 W4 CC vehicles and resolved shipping issues, with over 100 base W4 CC vehicles ready for production in Q1 [10][23] - The W750 pilot builds are underway, with regular production expected to start in Q2 2023 [10][24] - The C1000 program was discontinued due to engineering challenges, reallocating resources to other products [21][22] Market Data and Key Metrics Changes - The company is experiencing strong customer interest in the W4 CC and W750 vehicles, with expectations to ramp up production in 2023 [24][74] - The company plans to unveil the W56 at the NTEA Work Truck Show, with production starting in Q3 2023 [11][25] Company Strategy and Development Direction - The company aims to transition from a technology start-up to a commercial EV OEM, focusing on building a strong team and effective systems [7][59] - The strategic focus includes ramping up production of multiple Class 4 to Class 6 commercial vehicles and advancing drone development [59][60] - The company is also working on securing federal and state grants for its Aero business and expects to start drone production later in 2023 [18][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's progress and the potential for significant revenue growth in 2023, with expectations of $75 million to $125 million in revenue [51][52] - The company has resolved legacy legal and regulatory issues, allowing a sharper focus on strategic priorities [20][61] - Management highlighted the importance of infrastructure and economic models for the EV transition, emphasizing the need for government support [94] Other Important Information - The company has transformed its manufacturing facilities into a world-class operation, ready for production [33][60] - Capital expenditures for 2023 are expected to be between $15 million and $25 million, primarily for facility upgrades [49][101] Q&A Session Summary Question: Production cadence and cost reduction efforts - Management indicated that production is currently at about two W4 CC vehicles per day, targeting 40 to 50 by Q2, with cost efficiencies expected to improve as production ramps up [65][69] Question: Customer engagement and sales pipeline - The company has hired a new sales leader and built a strong sales team, with positive feedback from customers who have visited the facilities [72][74] Question: Guidance and production ramp-up - Visibility into the low end of the revenue range is primarily based on the W4 CC platform, with contributions expected from the W56 and W750 as they ramp up [84] Question: Royalties from the Lordstown deal - Management believes royalties still apply regardless of the agreement's status, contingent on Lordstown shipping trucks [111]