ElectraMeccanica Reports Fourth Quarter and Full Year 2020 Financial Results
March 23 2021 - 04:15PM
ElectraMeccanica Vehicles Corp. (NASDAQ:
SOLO) ("ElectraMeccanica" or the "Company"), a designer
and manufacturer of electric vehicles, reported financial results
for the fourth quarter and full year ended December 31, 2020 in
conjunction with the filing of its Annual Report on Form 20-F
earlier today.
Recent Company Highlights
- Selected Mesa, AZ, in the greater Phoenix area, for the
Company’s U.S. based assembly facility and engineering technical
center. The decision marked the culmination of a year-long
nationwide search. The proposed facility in Mesa will support
ElectraMeccanica’s strategic plan to meet anticipated demand for
its flagship SOLO EV. When fully operational, the
facility is expected to create up to 500 new jobs and will be
capable of producing up to 20,000 SOLOs per year. Altogether it
will feature both a light vehicle assembly plant along with a
state-of-the-art engineering technical center, including multiple
labs to support comprehensive research facilities as well as
vehicle chassis, battery pack and power electronics testing
workshops. The Company will also work with local municipalities to
initiate a pilot “SOLO share” program as part of
its larger drive, share, utility and fleet ecosystem.
- Expanded the SOLO retail footprint into ten
(10) additional high-end shopping centers and related areas as well
as two (2) new states. After the opening of seven (7) new locations
in May and June, the Company will then operate a total of twenty
(20) retail locations, counting eleven (11) in California, five (5)
in Arizona, two (2) in Oregon, one (1) in Washington and one (1) in
Colorado.
- Delivered a limited first shipment of SOLO EVs
into the U.S. In-line with the Company’s ongoing vehicle rollout
strategy, these SOLO EVs will be and have been
used specifically for high ROI activities, including press events,
marketing, retail distribution, test drives, corporate and
advertising purposes and fleet demonstrations.
- Hosted a “SOLO Drive Tour” for early adopters,
providing select reservation holders with the opportunity to look,
see and “Drive SOLO.” The multi-state tour began
in Scottdale, AZ, in the first quarter of 2021, and will be
followed by events in Cerritos, Walnut Creek and Corte Madera, CA,
as well as in Portland, OR.
- Scaled the “Drive SOLO” marketing campaign to
key eco-conscious cities with existing SOLO EV
retail presences. Drive SOLO is aimed at educating
and challenging consumers to reconsider their driving habits,
particularly when commuting to work, the gym or visiting friends.
The tradition/digital hybrid campaign features approximately 300
billboard and digital mall displays as well as social content
across the Company’s Facebook, LinkedIn, Twitter and Instagram
pages.
Management Commentary“2020 was
a transformative year for ElectraMeccanica, one that began with the
launch of our first retail locations and ended with the arrival of
the first production SOLO EVs onto U.S. soil,”
said Company CEO Paul Rivera. “In a relatively short amount of
time, we have expanded our geographic presence across soon-to-be 20
locations in five U.S. states and made great progress in building
our order book to support our long-term scaling efforts. We’re also
close to breaking ground on our new U.S. facility in Mesa, which,
when complete, will dramatically increase our technical and
production capabilities while creating hundreds of new jobs for the
local economy.
Fourth Quarter 2020 Financial
Summary (All amounts reported in USD)
- Cash and cash
equivalents and short-term deposits were $129.5 million as of
December 31, 2020, compared with $8.6 million as of December 31,
2019.
- Cash used in
operations in the fourth quarter of 2020 was $10.5 million,
compared with cash used in operations of $3.6 million in the same
year-ago quarter.
- Total revenue in
the fourth quarter of 2020 was $224,000, compared to $238,000 in
the same year-ago quarter. The decrease in revenue was primarily
attributable to a decrease in revenue associated with the sale of
custom-built roadsters.
- General and
administrative expenses in the fourth quarter of 2020 were $3.8
million, compared to $1.7 million in the same year-ago quarter. The
increase in G&A expenses was primarily due to increased rent,
office, legal and professional, investor relations and salary
expense, offset by decreased consulting fees.
- Research and
development expenses in the fourth quarter of 2020 were $3.8
million, compared to $2.0 million in the same year-ago quarter. The
increase in R&D expenses was primarily due to an increase in
labor costs, offset by a decrease in materials costs.
- Operating loss
in the fourth quarter of 2020 was $11.1 million, compared to an
operating loss of $6.3 million in the same year-ago quarter. The
increase in operating loss was primarily due to increases in
G&A, R&D and sales and marketing expenses.
- Net loss in the
fourth quarter of 2020 was $41.1 million, compared to a net loss of
$6.1 million in the same year-ago quarter. The increase in net loss
was primarily related to the increased expenses previously noted as
well as a change in the fair value of the Company’s warrant
derivative liability.
Full Year 2020 Financial Summary (All
amounts reported in USD)
- Cash used in
operations in 2020 was $22.5 million, compared to $16.9 million in
2019.
- Total revenue in
2020 was $569,000, compared to $586,000 in 2019. The decrease in
revenue was primarily attributable to a decrease in revenue
associated with the sale of custom-built roadsters.
- General and
administrative expenses in 2020 were $8.8 million, compared to $6.1
million in 2019. The increase in G&A expenses was primarily due
to increased rent, office, legal and professional, investor
relations and salary expense, offset by decreased consulting
fees.
- Research and
development expenses in 2020 were $7.9 million, compared to $7.2
million in 2019. The increase in R&D expenses was primarily due
to an increase in labor costs, offset by a decrease in materials
costs.
- Operating loss
in 2020 was $27.2 million, compared to $20.7 million in 2019. The
increase in operating loss was primarily due to increases in
G&A, R&D, sales and marketing expenses as well as increased
stock-based compensation expenses.
- Net loss in 2020
was $63.0 million, compared to $23.2 million in 2019. The increase
in net loss was primarily related to the increased expenses
previously noted as well as a change in the fair value of the
Company’s warrant derivative liability.
Company CFO Bal Bhullar added, “We ended the
year with more than $129 million in cash on the balance sheet,
putting us in the driver’s seat heading into 2021. With the
construction of our U.S. assembly facility and engineering
technical center on the horizon, we are in our strongest financial
position to date, both from a cash position as well as our controls
and procedures. As we continue to scale our production efforts
going forward, there will need to be additional strategic
investments in R&D, sales and marketing, and other key areas.
While we are making investments to support ElectraMeccanica’s
long-term growth, our focus remains on conservate capital
allocation and risk mitigation.”
The SOLO is a purpose-built,
three-wheeled, all-electric solution for the urban environment.
Engineered for a single occupant, it offers a unique driving
experience for the environmentally conscious consumer. The
SOLO has a range of 100 miles and a top speed of
80 mph, making it safe for highways. The SOLO
features front and rear crumple zones, side impact protection, roll
bar and torque-limiting control, as well as power steering, power
brakes, air conditioning and a Bluetooth entertainment system. It
blends a modern look with safety features at an accessible price
point of $18,500. The SOLO is currently available
for pre-orders here.
About ElectraMeccanica Vehicles
Corp.
ElectraMeccanica Vehicles Corp. (NASDAQ: SOLO)
is a Canadian designer and manufacturer of environmentally
efficient electric vehicles (EVs). The company’s flagship vehicle
is the innovative, purpose-built, single-seat EV called the
SOLO. This three-wheeled vehicle will
revolutionize the urban driving experience, including commuting,
delivery and shared mobility. The SOLO provides a
driving experience that is unique, trendy, fun, affordable and
environmentally friendly. InterMeccanica, a subsidiary of
ElectraMeccanica, has successfully been building high-end specialty
cars for 61 years. For more information, please visit
www.electrameccanica.com.
Safe Harbor Statement
Except for the statements of historical fact
contained herein, the information presented in this news release
and oral statements made from time to time by representatives of
the Company are or may constitute “forward-looking statements” as
such term is used in applicable United States and Canadian laws and
including, without limitation, within the meaning of the Private
Securities Litigation Reform Act of 1995, for which the Company
claims the protection of the safe harbor for forward-looking
statements. These statements relate to analyses and other
information that are based on forecasts of future results,
estimates of amounts not yet determinable and assumptions of
management. Any other statements that express or involve
discussions with respect to predictions, expectations, beliefs,
plans, projections, objectives, assumptions or future events or
performance (often, but not always, using words or phrases such as
“expects” or “does not expect”, “is expected”, “anticipates” or
“does not anticipate”, “plans, “estimates” or “intends”, or stating
that certain actions, events or results “may”, “could”, “would”,
“might” or “will” be taken, occur or be achieved) are not
statements of historical fact and should be viewed as
forward-looking statements. Such forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the
Company to be materially different from any future results,
performance or achievements expressed or implied by such
forward-looking statements. Such risks and other factors include,
among others, the availability of capital to fund programs and the
resulting dilution caused by the raising of capital through the
sale of shares, accidents, labor disputes and other risks of the
automotive industry including, without limitation, those associated
with the environment, delays in obtaining governmental approvals,
permits or financing or in the completion of development or
construction activities or claims limitations on insurance
coverage. Although the Company has attempted to identify important
factors that could cause actual actions, events or results to
differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events
or results not to be as anticipated, estimated or intended. There
can be no assurance that such statements will prove to be accurate
as actual results and future events could differ materially from
those anticipated in such statements. Although the Company believes
that the expectations reflected in such forward-looking statements
are based upon reasonable assumptions, it can give no assurance
that its expectations will be achieved. Forward-looking information
is subject to certain risks, trends and uncertainties that could
cause actual results to differ materially from those projected.
Many of these factors are beyond the Company’s ability to control
or predict. Important factors that may cause actual results to
differ materially and that could impact the Company and the
statements contained in this news release can be found in the
Company’s filings with the Securities and Exchange Commission. The
Company assumes no obligation to update or supplement any
forward-looking statements whether as a result of new information,
future events or otherwise. Accordingly, readers should not place
undue reliance on forward-looking statements contained in this news
release and in any document referred to in this news release. This
news release shall not constitute an offer to sell or the
solicitation of an offer to buy securities.
Company ContactMs. Bal Bhullar, CPA, CGA,
CRMChief Financial Officer & Director(604)
428-7656Bal@electrameccanica.com
Investor Relations ContactGateway Investor
RelationsMatt Glover and Tom Colton(949)
574-3860SOLO@gatewayir.com
Public Relations ContactMichelle
RaveloR&CPMK for ElectraMeccanica(714)
403-9534michelle.ravelo@rogersandcowanpmk.com
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