XL Fleet Corp. (NYSE: XL) (“XL Fleet” or the “Company”), a
leading provider of fleet electrification solutions for commercial
vehicles in North America, today announced third quarter 2021
financial results.
Third Quarter 2021 and Recent Highlights
- Generated revenue for third quarter of 2021 of $3.2 million,
compared to $6.3 million in the prior year
- Realized gross profit for the third quarter of 2021 of $0.7
million, compared to $0.8 million in the prior year
- Delivered gross margins of approximately 22%, compared to gross
margins of approximately 12% in the prior year
- Exited third quarter of 2021 with cash and cash equivalents of
approximately $367 million
- Expanded platform availability for XL Hybrid system on Ram 2500
& 3500 heavy duty pickup trucks and Isuzu NPR-HD
- Appointed automotive and mobility sector veteran Eric Tech as
new CEO of XL Fleet, effective December 1, 2021
Management Commentary & Outlook
“Our third quarter results were negatively impacted by ongoing
supply chain challenges continuing to face the global automotive
industry, limiting chassis availability on which our new systems
are installed,” said Tod Hynes, Founder & President of XL
Fleet. “Despite lower sequential revenue, we maintained attractive
gross margins driven by the first full-quarter contribution of our
recently acquired World Energy business. We further expanded our
solutions offering during the third quarter, including the
extension of our XL Hybrid System onto popular vehicle models,
including the Ram 2500 and 3500 heavy duty pickup trucks and Isuzu
NPR-HD. The strategic growth of our XL Grid offering achieved
during 2021 provides meaningful diversification to our business,
while widening the scope and scale of the electrification services
we are able to deliver to customers. XL Fleet maintains significant
financial flexibility, including $367 million of cash on our
balance sheet, positioning us to weather near-term pressure while
continuing to execute on our strategy.”
“The unprecedented lack of commercial fleet availability
plaguing the industry is expected to extend into 2022,” continued
Mr. Hynes. “Our team remains focused on our long-term mission of
helping to electrify the commercial fleet industry, and the
partnerships we have reached throughout the year positions us well
to scale our business and leverage our flexible and nimble business
model to navigate the dynamic road ahead. Despite the supply
challenges impeding 2021 growth, we have been focused on investing
in future growth areas. In 2022, we expect to expand our business
beyond North America, while delivering our first all-electric
solutions in applications such as refuse and electrified
refrigerated trailers. As the need for electrification continues to
expand, we expect XL Fleet’s established track-record of delivering
sustainability and comprehensive electrification solutions to
commercial fleets to drive further success and value for all
stakeholders.”
Third Quarter 2021 Financial Results
Revenue totaled $3.2 million in the third quarter of 2021
compared to $6.3 million in the third quarter of 2020. Revenue from
the sale of drive systems in the third quarter of 2021 totaled $0.6
million compared with $6.3 million in the third quarter of 2020 due
to negative impacts from ongoing supply chain issues including
microchip shortages that have led to a lack of new fleet chassis.
Revenue from XL Grid in the third quarter of 2021 totaled $2.6
million, driven by the full-quarter contribution of the World
Energy acquisition completed in May 2021.
Gross profit was $0.7 million for the third quarter of 2021,
compared to a gross profit of $0.8 million in the third quarter of
2020. Gross margins for the third quarter of 2021 were 22%,
compared to gross margins for the third quarter of 2020 of 12%. The
increase in gross margins was primarily driven by contribution from
the Company’s XL Grid business, which carries higher margins than
drive systems. Adjusted EBITDA was ($13.9) million for the third
quarter of 2021, compared to ($6.0) million for the third quarter
of 2020.
Net loss was ($7.5) million for the third quarter of 2021,
compared to net loss of ($2.3) million in the third quarter of
2020. Net loss for the third quarter of 2021 includes a non-cash
gain from the change in fair value of warrant liability of ($7.2)
million. Adjusted net loss was ($14.7) million for the third
quarter of 2021, compared to adjusted net loss of ($7.5) million in
the third quarter of 2020. A reconciliation of net loss to adjusted
net loss and adjusted EBITDA to adjusted net loss is set out in the
tables below.
Balance Sheet and Capital
Cash and cash equivalents as of September 30, 2021 totaled
$366.7 million compared to $329.6 million as of December 31, 2020.
Total debt outstanding as of September 30, 2021 was approximately
$0.1 million. XL Fleet has approximately 139.4 million shares of
Common Stock outstanding as of September 30, 2021.
Operating Summary
Since the beginning of 2020, the Company shipped a total of
1,661 drive systems, of which, 36 drive systems were shipped during
the third quarter of 2021. Drive systems shipped since the
beginning of 2020 include XL Fleet’s hybrid and plug-in hybrid
drive systems. XL Fleet is currently developing all electric
drivetrains that we expect to deploy on new vehicles in 2022. We
have also substantially expanded our XL Grid solutions with the
acquisition of World Energy in May 2021.
Third Quarter 2021 and Recent Operational & Business
Updates
- In November 2021, XL Fleet announced that its Board of
Directors appointed Eric Tech as Chief Executive Officer of XL
Fleet, effective December 1. Mr. Tech brings nearly 35 years of
automotive and mobility industry experience and has held senior
leadership positions at Navistar International Corporation and Ford
Motor Company. He most recently served as Senior Vice President of
Corporate Development at Navistar, a publicly traded global
manufacturer and marketer of medium and heavy duty vehicles and
parts.
- In August 2021, XL Fleet announced the availability of its
hybrid electric drive system for Ram 2500 and 3500 heavy duty
pickup trucks. The XLH™ system represents the Company’s first
electrification product to be available for Ram Commercial,
Stellantis’ line of commercial pickup trucks.
- In July 2021, XL Fleet announced the XL Hybrid System is now
available on the Isuzu NPR-HD low cab forward vehicle that serves
demanding applications including last mile delivery, beverage
distribution, utility work and food service.
- In July 2021, XL Fleet and eNow announced a partnership
including a supply agreement that entitles XL Fleet to provide
battery and power electronics systems for the first 1,000 units of
eNow’s innovative electrified refrigerated trailer solution.
Concurrent with the agreement, XL Fleet invested $3 million in eNow
with the right to acquire 100% of eNow at a pre-determined
valuation.
Conference Call Information
The XL Fleet management team will host a conference call to
discuss its third quarter 2021 financial results today at 5:00 p.m.
Eastern Time. The conference call can be accessed live by dialing
877-407-3982, or for international callers, 201-493-6780 and
referencing XL Fleet. Alternatively, the call can be accessed via a
live webcast accessible on the Events & Presentations page in
the Investor Relations section of the Company’s website at
www.xlfleet.com. A replay will be available shortly after the call
and can be accessed by dialing 844-512-2921, or for international
callers, 412-317-6671. The passcode for the replay is 13723537. The
replay will be available until November 29, 2021. An archive of the
webcast will be available for a period of time shortly after the
call on the Investor Relations section of the Company’s website at
www.xlfleet.com.
About XL Fleet
XL Fleet is a leading provider of vehicle electrification
solutions for commercial and municipal fleets in North America,
with more than 170 million miles driven by customers such as The
Coca-Cola Company, Verizon, Yale University and the City of Boston.
XL Fleet’s hybrid and plug-in hybrid electric drive systems can
increase fuel economy up to 25-50 percent and reduce carbon dioxide
emissions up to 20-33 percent, decreasing operating costs and
meeting sustainability goals while enhancing fleet operations. For
additional information, please visit www.xlfleet.com.
Forward Looking Statements
Certain statements in this press release may constitute
“forward-looking statements” within the meaning of the federal
securities laws. Forward-looking statements generally are
accompanied by words such as “believe,” “may,” “will,” “estimate,”
“continue,” “anticipate,” “intend,” “expect,” “should,” “would,”
“plan,” “predict,” “potential,” “seem,” “seek,” “future,”
“outlook,” and similar expressions that predict or indicate future
events or trends or that are not statements of historical matters.
These statements are based on various assumptions, whether or not
identified in this press release, and on the current expectations
of management and are not predictions of actual performance.
Forward-looking statements are subject to a number of risks and
uncertainties that could cause actual results to differ materially
from the forward-looking statements, including but not limited to;
the effects of pending and future legislation; the highly
competitive nature of the Company’s business and the commercial
vehicle electrification market; litigation, complaints, product
liability claims and/or adverse publicity; cost increases or
shortages in the components or chassis necessary to support the
Company’s products and services; the introduction of new
technologies; the impact of the COVID-19 pandemic on the Company’s
business, results of operations, financial condition, regulatory
compliance and customer experience; the potential loss of certain
significant customers; privacy and data protection laws, privacy or
data breaches, or the loss of data; general economic, financial,
legal, political and business conditions and changes in domestic
and foreign markets; the inability to convert its sales opportunity
pipeline into binding orders; risks related to the rollout of the
Company’s business and the timing of expected business milestones,
including the ongoing global microchip shortage and limited
availability of chassis from vehicle OEMs and our reliance on our
suppliers; the effects of competition on the Company’s future
business; the availability of capital; changes in the preliminary
financial results for the quarter ended September 30, 2021 upon
completion of the Company’s financial closing procedures or upon
review and completion of procedures by the Company’s independent
registered public accounting firm, and the other risks discussed
under the heading “Risk Factors” in the Company’s Annual Report on
Form 10-K filed on March 31, 2021, as amended and supplemented by
the 10-K/A filed May 17, 2021, and other documents that the Company
has filed or files with the SEC from time to time. If any of these
risks materialize or our assumptions prove incorrect, actual
results could differ materially from the results implied by these
forward-looking statements. These forward-looking statements speak
only as of the date hereof and the Company specifically disclaims
any obligation to update these forward-looking statements
Use of Non-GAAP Financial Information
To supplement its consolidated financial statements, which are
prepared and presented in accordance with U.S. generally accepted
accounting principles (“GAAP”), XL Fleet Corp. reports EBITDA,
Adjusted EBITDA, and Adjusted Net Income (Loss) which are non-GAAP
financial measures. EBITDA is determined by taking net income and
adding interest, depreciation and amortization. Adjusted EBITDA is
determined by taking EBITDA and adding change in fair value of
obligation to issue shares of common stock to sellers of World
Energy, non-recurring World Energy acquisition expenses and
accreted contingent compensation obligation to sellers of World
Energy, change in fair value of warrant liability, change in fair
value of convertible notes payable derivative liabilities and loss
on extinguishment of debt. Adjusted Net Income (Loss) is determined
by taking Net Income (Loss) and adding change in fair value of
obligation to issue shares of common stock to sellers of World
Energy, non-recurring World Energy acquisition expenses, accreted
contingent compensation obligation to sellers of World Energy,
change in fair value of warrant liability, and change in fair value
of convertible notes payable derivative liabilities and loss on
extinguishment of debt. This prospective financial information was
not prepared with a view toward compliance with published
guidelines of the SEC or the guidelines established by the American
Institute of Certified Public Accountants for preparation and
presentation of prospective financial information or U.S. GAAP with
respect to forward looking financial information. We believe that
these non-GAAP measures, viewed in addition to and not in lieu of
our reported GAAP results, provides useful information to investors
by providing a more focused measure of operating results, enhances
the overall understanding of past financial performance and future
prospects, and allows for greater transparency with respect to key
metrics used by management in its financial and operational
decision making. The non-GAAP measures presented herein may not be
comparable to similarly titled measures presented by other
companies. EBITDA, Adjusted EBITDA and Adjusted Net Income (Loss)
have been reconciled to the nearest GAAP measures in the tables
within these this press release.
XL Fleet Corp. Unaudited Consolidated
Statements of Operations For the Three and Nine Months Ended
September 30, 2021 and September 30, 2020
Three Months Ended September 30, Nine Months Ended
September 30, (In thousands, except per
share and share amounts)
2021
2020
2021
2020
(restated) Revenues
3,200
6,328
7,569
9,472
Cost of revenues
2,510
5,561
6,633
8,713
Gross profit (Loss)
690
767
936
759
Operating expenses: Research and development
3,217
1,646
7,438
3,297
Selling, general, and administrative expenses
12,742
5,304
31,522
10,798
Loss from operations
(15,269)
(6,183)
(38,024)
(13,336)
Other (income) expense:
-
-
-
Interest expense, net
14
1,266
35
4,291
Loss on extinguishment of debt
-
-
-
1,038
Loss on asset disposal
24
-
45
-
Change in fair value of obligation to issue shares of common stock
to sellers of World Energy
(532)
-
(18)
-
Change in fair value warrant liability
(7,229)
-
(81,960)
-
Change in fair value of convertible notes payable derivative
liability
-
(5,172)
-
3,565
Other Income
(15)
-
(40)
-
Net (Loss) Income
$
(7,531)
$
(2,277)
$
43,914
$
(22,230)
Net (loss) income per share, basic
$
(0.05)
$
(0.03)
$
0.32
$
(0.27)
Net loss per share, diluted
$
(0.05)
$
(0.03)
$
0.30
$
(0.27)
Weighted-average shares outstanding, basic
139,392,170
83,299,127
138,082,355
82,820,099
Weighted-average shares outstanding, diluted
139,392,170
83,299,127
148,469,108
82,820,099
XL Fleet Corp. Reconciliation of
Non-GAAP Financial Measures For the Three and Nine Months
Ended September 30, 2021 and September 30, 2020
Three Months Ended September 30, Nine Months Ended
September 30, (In thousands, except per share and share
amounts)
2021
2020
2021
2020
Reconciliation of Net Income (Loss) to Adjusted EBITDA Net
(Loss) Income
$
(7,531)
$
(2,277)
$
43,914
$
(22,230)
Interest Expense, net
14
1,266
35
4,291
Depreciation and Amortization
473
168
1,074
821
EBITDA
(7,044)
(843)
45,023
(17,118)
Loss on extinguishment of debt
-
-
-
1,038
Non-recurring World Energy acquisition expenses
-
-
498
-
Accreted contingent compensation obligation to sellers of World
Energy
573
-
1,000
-
Change in fair value of obligation to issue shares of common stock
to sellers of World Energy
(532)
-
(18)
-
Change in fair value warrant liabilities
(7,229)
-
(81,960)
-
Change in fair value of convertible notes payable derivative
liabilities
-
(5,172)
-
3,565
Adjusted EBITDA
$
(14,232)
$
(6,015)
$
(35,457)
$
(12,515)
Three Months Ended September 30, Nine Months Ended
September 30, (In thousands, except per share and share
amounts)
2021
2020
2021
2020
Reconciliation of Net Income (Loss) to Adjusted Net Income
(Loss) Net (Loss) Income
$
(7,531)
$
(2,277)
$
43,914
$
(22,230)
Loss on extinguishment of debt
-
-
-
1,038
Non-recurring World Energy acquisition expenses
-
-
498
-
Accreted contingent compensation obligation to sellers of World
Energy
573
-
1,000
-
Change in fair value of obligation to issue shares of common stock
to sellers of World Energy
(532)
-
(18)
-
Change in fair value warrant liabilities
(7,229)
-
(81,960)
-
Change in fair value of convertible notes payable derivative
liabilities
-
(5,172)
-
3,565
Adjusted Net Loss
$
(14,719)
$
(7,449)
$
(36,566)
$
(17,627)
XL Fleet Corp. Unaudited Condensed
Consolidated Balance Sheets As of September 30, 2021 and
December 31, 2020
September 30, December 31, (In thousands, except
share and per share amounts)
2021
2020
(audited) (restated)
Assets Current assets: Cash and cash
equivalents
366,748
329,641
Restricted cash
150
150
Accounts receivable
2,822
10,559
Inventory, net
18,104
3,574
Prepaid expenses and other current assets
1,210
1,396
Total current assets
389,034
345,320
Property and equipment, net
3,201
579
Intangible assets, net
1,773
593
Right-of-use asset
4,471
-
Investment in Convertible Note
3,000
-
Goodwill
8,841
489
Other assets
80
32
Total assets
410,400
347,013
Liabilities and stockholders' equity (deficit) Current
liabilities: Current portion of long-term debt, net of debt
discount and issuance costs
86
110
Accounts payable
3,197
4,372
Lease liability, current
880
-
Accrued expenses and other current liabilities
12,954
4,601
Total current liabilities
17,117
9,083
Long-term debt, net of current portion
37
98
Deferred revenue
706
305
Lease liability, non-current
3,526
-
Warrant liabilities
13,582
143,295
Contingent consideration
1,006
924
New market tax credit obligation(1)
4,372
4,412
Total liabilities
40,346
158,117
Commitments and contingencies Stockholders' equity
(deficit) Common stock, $0.0001 par value; 350,000,000 shares
authorized at September 30, 2021 and December 31, 2020, 139,403,914
and 131,365,254 issued and outstanding at September 30,2021 and
December 31,2020 respectively.
14
13
Additional paid-in capital
454,327
317,084
Accumulated deficit
(84,287)
(128,201)
Total stockholders' equity (deficit)
370,054
188,896
Total liabilities and stockholders' equity (deficit)
410,400
347,013
(1) Held by variable interest entity.
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Investor Contact: xlfleetIR@icrinc.com
Media Contact: PR@xlfleet.com
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