Lordstown Motors Provides Production and Financial Update
September 30 2021 - 6:01PM
Lordstown Motors Corp. (Nasdaq: RIDE), (“Lordstown Motors” or the
“Company”), a provider of electric light duty trucks focused on the
commercial fleet market, today announced that the Company and Hon
Hai Technology Group (“Foxconn”) (TWSE: 2317) have reached an
agreement in principle to work jointly on electric vehicle programs
in the Company’s assembly plant in Lordstown, Ohio. In
connection with this announcement, the Company is today updating
its production plan and financial outlook.
Production of the Endurance™ - The Lordstown Motors team
continues to move forward with its plan to build a limited number
of vehicles for testing, validation, verification and regulatory
approvals during the balance of 2021 and the first part of 2022. In
light of the Foxconn agreement, the Company will evaluate the
potential impact of the parties’ contract manufacturing
relationship on commercial production, supply chain opportunities
with Foxconn and the appropriate integration and timing of the
parties’ operations teams and will provide an update on its
production plan during our upcoming Q3 2021 earnings call currently
slated for mid-November. See “Forward-Looking Statements”
below.
Financial outlook - The Company is updating its 2021 financial
outlook last provided during its Q2 2021 earnings call, as
follows:
- Capital expenditures – unchanged in
total from $375 to $400 million, including changes in timing of
tooling and equipment purchases and the inclusion of forecasted
soft tooling expense purchases previously included in R&D
expense.
- SG&A expenditures - $105 to $120
million, up from $95 to $105 million, primarily due to higher legal
and professional fees.
- R&D expenditures - $320 to $340
million, up from $310 to $320 million, largely due to increased
prototyping and pre-production expenses, reduced by the impact of
moving forecasted soft tooling expense to capital expenditures as
mentioned above.
- Cash balance on September 30, 2021 -
$210 to $240 million, down from $225 to $275 million, which
includes approximately $20 million of proceeds from the issuance of
common stock under the Company’s Equity Purchase Agreement in
August and September but excludes proceeds from Foxconn’s purchase
of $50 million of the Company’s common stock as announced
today.
These updated financial projections regarding pre-production
expenses may be affected by numerous factors, including the results
of validation and regulatory testing, supply chain constraints and
delays, and the timing of tooling and equipment purchases. See
“Forward-Looking Statements” below.
Lordstown Motors has engaged Jefferies LLC to advise the Company
on additional financing alternatives, which may include private or
public equity transactions, debt financings, or some combination of
these.
About Lordstown Motors Corp.
Lordstown Motors is an Ohio-based electric vehicle (EV)
innovator developing high-quality light duty commercial fleet
vehicles, with the Endurance all electric pick-up truck as its
first vehicle being launched in the Lordstown, Ohio facility. The
Company has engineering, research and development facilities in
Farmington Hills, Michigan and Irvine, California. For additional
information visit www.lordstownmotors.com.
About Foxconn Technology Group
Established in Taiwan in 1974, Hon Hai Technology Group
(Foxconn) (ticker 2317 in Taiwan) is the world’s largest
electronics manufacturer. Foxconn is also the leading technological
solution provider, and it continuously leverages its expertise in
software and hardware to integrate its unique manufacturing systems
with emerging technologies. By capitalizing on its expertise in
Cloud Computing, Mobile Devices, IoT, Big Data, AI, Smart Networks,
and Robotics / Automation, the Group has expanded not only its
capabilities into the development of electric vehicles, digital
health and robotics, but also three key technologies –AI,
semiconductors and new-generation communications technology – which
are key to driving its long-term growth strategy and the four core
product pillars: Consumer Products, Enterprise Products, Computing
Products and Components and Others. For additional information
visit https://www.foxconn.com/en-us/.
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 “feel,” “believes,” “expects,”
“estimates,” “projects,” “intends,” “should,” “is to be,” 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 not guarantees of future
performance and are subject to risks and uncertainties, which could
cause actual results to differ materially from the forward-looking
statements contained herein due to many factors, including, but not
limited to: our limited operating history and our significant
projected funding needs; our liquidity position; the need to raise
substantial additional capital to continue ongoing operations;
risks associated with the conversion and retooling of our facility
and ramp up of production; our inability to obtain binding purchase
orders from customers and potential customers’ inability to
integrate our electric vehicles into their existing fleets; our
inability to retain key personnel and to hire additional personnel;
competition in the electric pickup truck market; supply chain
disruptions; the potential inability to source essential
components; our inability to develop a sales distribution network;
the ability to protect our intellectual property rights; and the
failure to obtain required regulatory approvals. In addition, our
agreement in principle with Foxconn is non-binding and subject to
the negotiation and execution of definitive agreements. No
assurances can be given that definitive agreements will be entered
into on the terms contemplated, or at all. Nor can any assurances
be given as to the timing of any such agreements. Furthermore,
potential supply chain disruptions, and their consequences on
testing and other activities, could present challenges that impact
the timing of our commercial production. Any forward-looking
statements speak only as of the date on which they are made, and
Lordstown Motors undertakes no obligation to update any
forward-looking statement to reflect events or circumstances after
the date of this press release.
Contacts:
InvestorsCarter W. Driscoll, CFAlordstownIR@icrinc.com
MediaKimberly SpellKimberly.spell.ext@lordstownmotors.com
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