Hyliion Holdings Corp. (NYSE: HYLN) (“Hyliion”), a leader in
electrified powertrain solutions for Class 8 semi-trucks, today
reported its third-quarter 2022 financial results.
Key Business Highlights
- Closed acquisition of the KARNO™ generator from GE Additive, a
revolutionary hydrogen and fuel-agnostic technology
- Announcing Founders Program for first 200 Hypertruck ERXTM
units and releasing details around Hypertruck ERX go-to-market
strategy, launch facility and expected vehicle pricing
- Reached new milestone in Hypertruck ERX development with
deployment of test vehicles in controlled fleet trials with
GreenPath Logistics, Wegmans and Detmar Logistics to date
- Confirmed Hypertruck ERX system will qualify for tax credit of
30%, up to $40,000, under new Inflation Reduction Act
- Generated $0.5 million in revenue from Hybrid and full truck
sales with approximately $1.3 million in backlog of Hybrid
systems
- Appointed Jon Panzer as Chief Financial Officer
- Closed quarter with over $455 million of cash and marketable
investments, which is sufficient to commercialize the Hypertruck
ERX system and fund other development activities
- Updating full-year 2022 guidance to include revenue of
approximately $2.0 million and operating expenses of approximately
$130 million
Executive Commentary
“We reached multiple milestones in the third quarter, including
the start of controlled fleet trials for the Hypertruck ERX and our
acquisition from GE Additive of the KARNO generator technology, a
revolutionary hydrogen and fuel-agnostic generator that will be
central to our long-term product roadmap,” said Thomas Healy,
Hyliion’s founder and chief executive officer. “Additionally,
trucks with the Hypertruck ERX system are now fully eligible under
the Inflation Reduction Act, which became law in August, for a 30%
tax credit of up to $40,000. Incentives like this can reduce
up-front costs for customers and enable an easier transition to
electrification technology.”
“We now have filled our Founders Program and have committed
orders for our first 200 production slots. Additionally, we have
nearly 2,000 reservations in backlog. As we move towards
commercialization, we anticipate starting production in late 2023
and plan to have all 200 of these first trucks delivered to fleets
by the end of the first quarter of 2024.”
Hypertruck ERX Development
In the third quarter, the Company continued the
design-verification phase of its Hypertruck ERX system development
with the deployment of test vehicles in controlled fleet trials, of
which three have already commenced. Fleet trials include customers
driving hundreds of miles per day under real-world conditions on
their normal routes. Hyliion service technicians and engineers
provided support to collect data and driver feedback.
Also in the third quarter, the Company successfully completed
summer testing of the Hypertruck ERX system. Four
design-verification vehicles conducted a number of tests at
different weight loads at Davis Dam in Arizona. Testing featured
some of the most challenging road conditions in the United States,
including a 6% grade that stretches approximately 11 miles.
Overall, Hyliion remains on schedule to start winter testing by
the end of this year. This marks the fourth consecutive quarter
that the Company has met the commercialization goals initially laid
out on its third-quarter 2021 earnings call.
Hypertruck ERX Go-To-Market Strategy
Initially, powertrains will be installed at the Company’s
Austin, Texas facility and at modification centers near OEM
factories. As sales volumes increase, Hyliion’s strategy is to be a
powertrain company, selling solutions directly to OEMs who will
integrate them into their production lines. The Company expects
initial pricing, inclusive of the Inflation Reduction Act tax
credit, for a truck with a Hypertruck ERX system to be in the high
three hundred thousands, which is less expensive than battery and
fuel cell electric trucks. As such, buyers are expected to realize
a total cost of ownership benefit over other electrified solutions
and one that is comparable to a diesel truck when considering the
truck purchase price and the cost of fuel.
The Company is outlining plans for its Founders Program, which
will be the deployment of the first 200 production builds starting
in late 2023. The Founders Program will include a special
white-glove service and maintenance program centered out of a
Hyliion launch facility in Dallas. In addition to providing support
services, the launch facility is expected to offer onsite renewable
natural gas fueling capability. The Company is also working on a
nationwide service plan with partners who will be authorized to
work on the Hypertruck ERX powertrain.
Hyliion is confident that the completion of planned testing and
validation work, along with expanded fleet trials, and the
availability of truck pricing, will drive more orders for delivery
in 2024 and beyond.
Hybrid Update
In the third quarter, Hyliion continued to install and deliver
its Hybrid powertrain product, including hybrid systems and
complete vehicle deliveries. Due to persistent shortages and
extended lead times for commercial trucks, the Company continues to
experience delays in customer truck availability, which has
affected installation and delivery timing. The Company currently
has a backlog for the Hybrid system of approximately $1.3 million
and will continue to upfit customer trucks with Hybrid
products.
KARNO Acquisition
In the third quarter, Hyliion closed on its acquisition of the
KARNO generator and its associated IP from GE Additive, part of
General Electric (NYSE: GE) and a world leader in metal additive
technologies and manufacturing. Under the terms of the deal, GE
received $15 million in cash and approximately $16.1 million, or
5.5 million shares, in Hyliion stock.
In the years ahead, the KARNO generator will be deployed in
Hyliion’s Hypertruck powertrain platform to offer a
next-generation, fuel-agnostic, semi-truck solution. Hyliion is
integrating the Cincinnati-based engineering team that created the
KARNO system into the Company’s operations.
New Chief Financial Officer
In the third quarter, as previously announced, the Company
appointed Jon Panzer as its new Chief Financial Officer. Mr. Panzer
was previously senior vice president of intermodal operations at
Union Pacific Railroad Company. In his 26 years at Union Pacific,
his responsibilities included treasury operations, investor
relations, banking, capital budgeting, financial reporting, and
cost accounting. Additionally, as head of Union Pacific’s
information technology organization, Mr. Panzer was responsible for
managing application development, technology infrastructure and
cybersecurity.
Financial Highlights and Operating Expense Guidance
In the third quarter, the Company recorded $0.5 million in
revenue. The Company’s third-quarter operating expenses totaled
$62.9 million, driven primarily by R&D expenses including $28.8
million related to the KARNO acquisition. Hyliion ended the quarter
with over $455 million of cash and marketable investments, which is
sufficient to fund the organization through its current
commercialization plans for the Hypertruck ERX system and fund
other development activities. This includes cash and cash
equivalents of $154.2 million, short-term investments of $232.9
million, and long-term investments of $68.4 million.
For full-year 2022, Hyliion projects revenue of approximately $2
million from Hybrid sales and the sale of full trucks with Hybrid
systems and expects its operating expenses to be approximately $130
million.
Third Quarter 2022 Conference Call
Hyliion will host a conference call and accompanying webcast at
11:00 a.m. EST / 10:00 a.m. CST on Wednesday, November 9 to discuss
its financials, business results, and outlook. The live webcast of
the call, as well as an archived replay following, will be
available online on the Investor Relations section of Hyliion’s
website. Those wishing to participate can access the call using the
links below:
Conference Call Online Registration:
https://conferencingportals.com/event/vjUOPPlo
Webcast:
https://investors.hyliion.com/events-and-presentations/default.aspx
Third-quarter 2022 financial results for Hyliion Holdings Corp.
will also be filed with the SEC on Form 10-Q.
About Hyliion
Hyliion’s mission is to reduce the carbon intensity and
greenhouse gas (GHG) emissions of Class 8 semi-trucks by being a
leading provider of electrified powertrain solutions. Hyliion
offers fleets efficient and practical systems to decrease fuel and
operating expenses while seamlessly integrating with their existing
fleet operations. Headquartered in Austin, Texas, Hyliion designs,
develops, and sells electrified powertrain solutions that can be
installed on most major Class 8 semi-trucks, and leverages advanced
software algorithms and data analytics to improve overall
efficiencies. Hyliion’s goal is to transform the commercial
transportation industry’s environmental impact at scale. For more
information, visit www.hyliion.com.
Forward Looking Statements
The information in this press release includes “forward-looking
statements” within the meaning of Section 27A of the Securities Act
of 1933, as amended, and Section 21E of the Securities Exchange Act
of 1934, as amended. All statements, other than statements of
present or historical fact included in this press release,
regarding Hyliion and its future financial and operational
performance, as well as its strategy, future operations, estimated
financial position, estimated revenues, and losses, projected
costs, prospects, plans and objectives of management are forward
looking statements. When used in this press release, including any
oral statements made in connection therewith, the words “could,”
“should,” “will,” “may,” “believe,” “anticipate,” “intend,”
“estimate,” “expect,” “project,” the negative of such terms and
other similar expressions are intended to identify forward-looking
statements, although not all forward-looking statements contain
such identifying words. These forward-looking statements are based
on management’s current expectations and assumptions about future
events and are based on currently available information as to the
outcome and timing of future events. Except as otherwise required
by applicable law, Hyliion expressly disclaims any duty to update
any forward-looking statements, all of which are expressly
qualified by the statements herein, to reflect events or
circumstances after the date of this press release. Hyliion
cautions you that these forward-looking statements are subject to
numerous risks and uncertainties, most of which are difficult to
predict and many of which are beyond the control of Hyliion. These
risks include, but are not limited to, our status as an early stage
company with a history of losses, and our expectation of incurring
significant expenses and continuing losses for the foreseeable
future; our ability to develop to develop key commercial
relationships with suppliers and customers; our ability to retain
the services of Thomas Healy, our Chief Executive Officer; our
ability to disrupt the powertrain market; the effects of our
dynamic and proprietary solutions on commercial truck customers;
the ability to accelerate the commercialization of the Hypertruck
ERX; our ability to meet 2022 and future product milestones; the
impact of COVID-19 on long-term objectives; the ability of our
solutions to reduce carbon intensity and greenhouse gas emissions,
the expected performance and integration of the KARNO generator and
system, and the other risks and uncertainties described under the
heading “Risk Factors” in our other SEC filings including in our
Annual Report (See item 1A. Risk Factors) on Form 10-K filed with
the Securities and Exchange Commission (the “SEC”) on February 24,
2022 for the year ended December 31, 2021. Given these risks and
uncertainties, readers are cautioned not to place undue reliance on
such forward-looking statements. Should one or more of the risks or
uncertainties described in this press release occur, or should
underlying assumptions prove incorrect, actual results and plans
could different materially from those expressed in any
forward-looking statements. Additional information concerning these
and other factors that may impact Hyliion’s operations and
projections can be found in its filings with the SEC. Hyliion’s SEC
Filings are available publicly on the SEC’s website at www.sec.gov,
and readers are urged to carefully review and consider the various
disclosures made in such filings.
HYLIION HOLDINGS CORP.
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
(Dollar amounts in thousands,
except share and per share data)
Three Months Ended September
30,
Nine Months Ended September
30,
2022
2021
2022
2021
Revenues
Product sales and other
$
499
$
—
$
1,011
$
—
Total revenues
499
—
1,011
—
Cost of revenues
Product sales and other
2,916
—
7,160
—
Total cost of revenues
2,916
—
7,160
—
Gross loss
(2,417)
—
(6,149)
—
Operating expenses
Research and development
(52,678)
(18,150)
(88,543)
(40,871)
Selling, general and administrative
(10,264)
(8,660)
(32,255)
(26,111)
Total operating expenses
(62,942)
(26,810)
(120,798)
(66,982)
Loss from operations
(65,359)
(26,810)
(126,947)
(66,982)
Interest income
1,926
195
3,066
561
Gain (Loss) on disposal of assets
46
—
(89)
—
Net loss
$
(63,387)
$
(26,615)
$
(123,970)
$
(66,421)
Net loss per share, basic and diluted
$
(0.36)
$
(0.15)
$
(0.71)
$
(0.39)
Weighted-average shares outstanding, basic
and diluted
174,345,022
172,987,672
173,945,156
171,842,664
HYLIION HOLDINGS CORP.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(Dollar amounts in thousands,
except share data)
September 30,
2022
December 31,
2021
(Unaudited)
Assets
Current assets
Cash and cash equivalents
$
154,161
$
258,445
Accounts receivable
894
70
Inventory
140
114
Prepaid expenses and other current
assets
5,876
9,068
Short-term investments
232,917
118,787
Total current assets
393,988
386,484
Property and equipment, net
5,772
2,235
Operating lease right-of-use assets
6,792
7,734
Intangible assets, net
195
235
Other assets
1,730
1,535
Long-term investments
68,422
180,217
Total assets
$
476,899
$
578,440
Liabilities and stockholders’
equity
Current liabilities
Accounts payable
$
2,279
$
7,455
Current portion of operating lease
liabilities
325
21
Accrued expenses and other current
liabilities
14,168
7,759
Total current liabilities
16,772
15,235
Operating lease liabilities, net of
current portion
7,399
8,623
Other liabilities
1,492
667
Total liabilities
25,663
24,525
Commitments and contingencies
Stockholders’ equity
Common stock, $0.0001 par value;
250,000,000 shares authorized; 179,645,873 and 173,468,979 shares
issued and outstanding at September 30, 2022 and December 31, 2021,
respectively
18
17
Additional paid-in capital
396,085
374,795
Retained earnings
55,133
179,103
Total stockholders’ equity
451,236
553,915
Total liabilities and stockholders’
equity
$
476,899
$
578,440
HYLIION HOLDINGS CORP.
UNAUDITED CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Dollar amounts in
thousands)
Nine Months Ended September
30,
2022
2021
Cash flows from operating
activities
Net loss
$
(123,970)
$
(66,421)
Adjustments to reconcile net loss to net
cash used in operating activities:
Depreciation and amortization
823
657
Amortization and accretion of
investments
1,300
1,318
Noncash lease expense
922
720
Inventory write-down
5,634
—
Loss on disposal of assets
89
—
Share-based compensation
5,268
3,972
Acquired in-process research and
development
28,752
—
Changes in operating assets and
liabilities:
Accounts receivable
(824)
(267)
Inventory
(5,660)
—
Prepaid expenses and other assets
3,097
3,646
Accounts payable
(5,201)
5,617
Accrued expenses and other liabilities
7,228
1,309
Operating lease liabilities
(900)
(373)
Net cash used in operating activities
(83,442)
(49,822)
Cash flows from investing
activities
Purchase of property and equipment and
other
(2,621)
(2,213)
Proceeds from sale of property and
equipment
33
—
Purchase of in-process research and
development
(14,428)
—
Payments for security deposit, net
—
(29)
Purchase of investments
(160,116)
(268,714)
Proceeds from sale and maturity of
investments
156,382
205,355
Net cash used in investing activities
(20,750)
(65,601)
Cash flows from financing
activities
Proceeds from exercise of stock warrants,
net of issuance costs
—
16,257
Payments for Paycheck Protection Program
loan
—
(908)
Proceeds from exercise of common stock
options
65
553
Taxes paid related to net share settlement
of equity awards
(157)
—
Net cash (used in) provided by financing
activities
(92)
15,902
Net decrease in cash and cash equivalents
and restricted cash
(104,284)
(99,521)
Cash and cash equivalents and restricted
cash, beginning of period
259,110
389,705
Cash and cash equivalents and restricted
cash, end of period
$
154,826
$
290,184
Supplemental disclosure of noncash
investing and financing activities:
Common stock issued for purchase of
assets
$
16,115
$
—
Acquisitions of property and equipment
included in accounts payable and other
$
66
$
20
View source
version on businesswire.com: https://www.businesswire.com/news/home/20221108006272/en/
Hyliion Holdings Corp. Ryann Malone
press@hyliion.com (833) 495-4466
Sharon Merrill Associates, Inc. Nicholas Manganaro
hyln@investorrelations.com (617) 542-5300
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