Tritium Reports Record Revenue And Plans For Growth Amid New Partnerships
September 27 2023 - 8:45AM
IH Market News
Tritium (NASDAQ:DCFC), a prominent provider of electric vehicle
(EV) charging solutions, has reported record-breaking revenue for
the fiscal year ending on June 30, 2023, reaching an impressive
$185 million, marking a substantial 115% year-over-year increase.
Notably, the company has also achieved a substantial enhancement in
its gross margin, which reached 4% for the initial half of the
calendar year. Tritium’s Tennessee manufacturing facility has
effectively expanded its operations, attaining record unit
production, and the company has successfully established new
strategic partnerships with customers. Furthermore, Tritium is set
to unveil its MyTritium software platform before the end of the
year and has plans to introduce a modular and scalable 400-kilowatt
charger in 2024.
Key highlights from the earnings call include:
1. Tritium has reported remarkable revenue growth, with sales
orders totaling $146 million and a backlog of approximately $99
million.
2. The company’s production has experienced a substantial
increase, with 7,800 units manufactured during the fiscal year and
5,100 units produced during the six-month period concluding on June
30.
3. Tritium has secured financing commitments of up to $75
million to meet the anticipated strong demand in 2024.
4. The company has formed new customer partnerships, including a
major European utility, a global fleet company, and a global
automotive OEM.
5. Tritium plans to introduce a high-power, 250-mile range
addition in just 10 minutes, aiming to appeal to operators of
public charging networks and fleet customers.
6. Tritium anticipates achieving a positive EBITDA in the first
half of the upcoming year.
During the earnings call, Tritium discussed the notable
improvement in its financial performance over the past two years,
attributing a significant portion of this success to the expansion
of its Tennessee facility. The company has witnessed consistent
growth in its gross margin and anticipates this positive trend to
continue. Tritium achieved a 4% gross margin in the first half of
the calendar year and aims to achieve a guidance range of 10% to
12% in the latter half.
Tritium also disclosed that it maintains inventory worth $140
million, encompassing spare parts, finished products, and chargers
in transit. The company is confident that remote monitoring
services will emerge as a substantial source of revenue and intends
to aggressively roll out this service. Different customer segments,
including fuel, fleet, and charging networks, contribute to varying
volumes and margins.
The company intends to align its overhead and SG&A expenses
with sales forecasts. Tritium also outlined its strategy to address
interest expenses and debt servicing, mentioning the potential
conversion of certain debt into equity and the use of cash
generated from operations to retire debt. Tritium enjoys a
supportive relationship with its debt providers.
Tritium’s CEO, Jane Hunter, explained that the strong revenue
performance in the first half was partly due to delayed orders from
the previous year. Production records were achieved in May and
June, although July and August witnessed reduced production due to
inventory management and optimization of manufacturing processes.
Hunter expressed confidence in the second half and highlighted
strategic customers with imminent purchase orders, along with
ongoing negotiations with American CPOs.
Tritium anticipates its expected CapEx for 2023 to amount to
$7.95 million, with modest requirements anticipated for 2024.
Hunter noted that the transition from order backlog-driven to
flow-driven orders may result in a slightly lower backlog entering
2024, as customers now provide forecasts and letters of intent
instead of secured purchase orders. Nevertheless, the company
remains confident in its prospects for revenue and margin
growth.
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