VivoPower International PLC (NASDAQ: VVPR) (“VivoPower,” the
“Company”) today announced its results for the fiscal year ended
June 30, 2023.
Highlights for the fiscal year ended June 30,
2023:
- Annual group revenue from
continuing operations declined 33% year-on-year ("y-o-y") to $15.1
million, primarily due to fewer solar projects being executed at
Aevitas Solar, with ongoing skills shortages in the Australian
electrical and building & construction industry causing
difficulties in resourcing projects to meet demand, as well as a
further decline in the Australian dollar versus the US dollar.
Excluding the effect of movements in the AUD/USD exchange rate,
annual group revenue from continuing operations declined by
28%.
- Annual group gross loss from
continuing operations decreased y-o-y to ($2.3) million from $0.3
million gross profit in Fiscal Year 2022 ("FY22") due to unseasonal
wet weather conditions in Australia (as a result of the La Niña
weather phenomenon) which delayed works. The loss recognized during
the period for the Edenvale solar farm in Aevitas Solar amounted to
$3.9 million. Excluding this one-off loss, group gross profit was
$1.6 million.
- Annual net after-tax loss from
continuing operations of ($20.1) million and earnings per share
("EPS") of ($0.82) per share, improved from a ($21.4) million loss
and ($1.03) per share for FY22. Annual adjusted net after-tax loss1
of ($14.2) million and adjusted EPS1 of ($0.58) per share narrowed
from a ($19.1) million loss and ($0.92) per share respectively for
FY22.
- Annual underlying group adjusted
EBITDA1 loss from continuing operations was ($5.7) million,
representing an improvement versus ($9.1) million EBITDA loss from
continuing operations for FY22, reflecting lean management modus
operandi.
- Group cash level was $0.6 million
at June 30, 2023 (excluding restricted cash balances, bank
guarantee deposits and other cash equivalents) but on a pro-forma
basis, inclusive of earnout proceeds from the J.A. Martin ex-solar
sale, initial cash investment received from UAE private investment
office announced in June and loans from AWN Holdings, cash balance
was $2.8m.
- In June 2023, VivoPower’s major
shareholder agreed to further amend the loan and bridge financing
facilities terms to extend the deferred interest payment date to 1
April 2025, further de-risking the Company’s balance sheet.
- In Fiscal Year 2023 (“FY23”), Tembo
successfully negotiated several large distribution agreements with
partners around the globe. In November 2022, the Company signed a
definitive agreement with ETC Mauritius in Kenya for the
distribution of 4,000 conversion kits, which marked Tembo’s largest
agreement to date and its entry into the second hand light utility
vehicle market. In that same month, it signed a supply agreement
with Evolution Group Holdings to convert their fleet of Toyota
Hilux ICE vehicles in Australia and New Zealand to
battery-electric, making Evolution the first traffic management
company to commit to the conversion of its fleet to EVs. In
February, it signed a definitive agreement with Ulti-Mech in
Australia to distribute 1,000 conversion kits, adding to its
geographic coverage the important Western Australia mining region,
a leading destination in the world for mining investment. In March,
it signed a memorandum of understanding with Petrosea, a key
supplier to the mining and oil & gas sectors in Indonesia, to
distribute 2,000 conversion kits. In June, it signed a definitive
agreement with Fourche Maline, an engineering and technical
services company in Ghana, one of the largest mining countries in
the world and the number one gold mining country in Africa, for
2,500 conversion kits.
- In June, Tembo signed a memorandum
of understanding with Al Taif to form a partnership spanning
distribution of Tembo EUV conversion kits, research &
development, training in electric mobility and high voltage, as
well as local assembly operations in the UAE.
- Post June 30, 2023, Tembo signed a
landmark joint venture agreement with Francisco Motors, the
pioneering manufacturer of jeepneys in the Philippines to electrify
the iconic public transport vehicles. Francisco Motors and Tembo
have already secured their first orders and have commenced work to
deliver on those orders. The agreement will also give Tembo access
to low-cost assembly and supply chains in the Philippines and Asia
more broadly.
- VivoPower was recognized by B Lab
United Kingdom as one of the Best for the World (BFTW) for
Governance in 2022 and by Real Leaders as one of the top 200 global
impact companies in the 2023 Real Leaders Impact Awards for the 3rd
year in a row.
(1) Adjusted EBITDA,
adjusted net after-tax loss and adjusted EPS are non-GAAP measures.
See the “About Non-IFRS Financial Measures” section and
reconciliation tables accompanying the release.
A reconciliation of IFRS (“International
Financial Reporting Standards”) to non-IFRS financial measures has
been provided in the financial statement table included in this
press release. An explanation of these measures is also included
below, under the heading “About Non-IFRS Financial Measures.”
Executive Chairman, Kevin Chin noted “The financial year ended
June 30, 2023 was challenging. We delivered considerable progress
on Tembo operationally and commercially but at a group level we
were adversely impacted by the negative consequences of unexpected
and prolonged adverse weather conditions and skills shortages in
Australia, where the majority of our revenue, gross profit and
earnings are currently generated. Both have now abated and we are
looking at a much more promising Fiscal Year 2024 with a resumption
of growth expected across all of our business units.
The uncontrollable factors in Australia have resulted in
significant delays in both projects and deliveries, resulting in
gross profit being below budget. This includes a one-off loss of
$3.9m at the gross profit level, attributable to the Edenvale solar
project in Australia, which became unprofitable directly as a
consequence of extreme unprecedented weather conditions and damage
to completed works, requiring remediation. The focus for our
Australia-based Critical Power businesses will be on Kenshaw which
has consistently performed and is set to resume its growth
trajectory as it seeks services-based contracts and new sources of
revenue having obtained its AS/NZS3800 capability.
In our Electric Vehicle segment, Tembo’s order and commitment
book increased by 160% to 13,000+ EV drivetrain kits (excluding
MOUs and E-jeepneys in the Philippines), demonstrating the
increasing demand for fleet electrification solutions across the
globe and across sectors. On the operational side, the first
version of the next generation EUV conversion kit was fully
integrated into a vehicle in December and underwent extensive
testing to prepare the ramp-up in production required to deliver to
our existing partners and customers later this calendar year 2023.
Post balance date, we also secured access to a new complementary
$10bn+ addressable market by signing a definitive deal with the
original jeepney manufacturer, E-Francisco Motors in the
Philippines to converting the iconic jeepney public utility
vehicles to electric.
Throughout FY2023, Tembo also continued to
selectively hire experienced engineering talent in its key markets,
several of them world leading experts in their field having worked
for the likes of Tesla, Rivian, Toyota, amongst others. Since 1
July 2022, we have hired 15 full time engineers in the UK,
Netherlands, Australia and the United States for Tembo and Vivo
SES, as well as a number of key engineering advisers. In doing so,
we have more than doubled the cumulative years of direct EV
engineering experience to over 100 years.
On the Caret front, we have signed a term sheet with Backbone
Digital, contributing 2 of our Texas solar projects (totalling
96.5MW-DC) at a valuation of US$7.7m.
As always, the VivoPower team remains focused on
achieving its medium to long term strategic, financial and impact
goals.”
About Non-IFRS Financial
Measures
Our results include certain non-IFRS financial
measures, including adjusted EBITDA, adjusted net after-tax loss
and adjusted EPS. Management believes that the use of these
non-IFRS financial measures provides consistency and comparability
with our past financial performance, facilitates period-to-period
comparisons of our results of operations, and also facilitates
comparisons with peer companies, many of which use similar non-IFRS
or non-GAAP (“Generally Accepted Accounting Principles”) financial
measures to supplement their IFRS or GAAP results. Non-IFRS results
are presented for supplemental informational purposes only to aid
in understanding our results of operations. The non-IFRS results
should not be considered a substitute for financial information
presented in accordance with IFRS, and may be different from
non-IFRS or non-GAAP measures used by other companies.
The tables included in this press release titled
“Reconciliation of Adjusted (Underlying) EBITDA for Continuing
Operations to IFRS Financial Measures” and “Reconciliation of
Adjusted (Underlying) Net After-Tax Loss for Continuing Operations
and Adjusted (Underlying) EPS to IFRS Financial Measures” provide
reconciliations of non-IFRS financial measures to the most recent
directly comparable financial measures calculated and presented in
accordance with IFRS.
Adjusted (Underlying) EBITDA equates to earnings
before interest, taxes, depreciation and amortization,
non-cash-based share compensation, impairment of assets, impairment
of goodwill, and restructuring and other non-recurring costs. See
the reconciliation of non-IFRS measures on next page.
Adjusted net after-tax loss equates to net
after-tax loss adjusted for restructuring and other non-recurring
costs and cost of sales – nonrecurring. See the reconciliation of
non-IFRS measures on next page.
Adjusted (Underlying) EPS equates to earnings
per share adjusted for restructuring and other non-recurring costs
and cost of sales - nonrecurring. See the reconciliation of
non-IFRS measures on next page.
Reconciliation of Adjusted (Underlying)
EBITDA for Continuing Operations to IFRS Financial
Measures
|
|
Twelve months ended June 30 |
(US dollars in thousands) |
|
2023 |
|
|
|
2022 |
|
Net after-tax loss |
|
(24,355 |
) |
|
|
(22,054 |
) |
Loss from discontinued
operations |
|
4,207 |
|
|
|
625 |
|
Net after-tax Loss from
continuing operations |
|
(20,148 |
) |
|
|
(21,429 |
) |
Income tax |
|
540 |
|
|
|
(1,968 |
) |
Net finance expense |
|
6,210 |
|
|
|
8,431 |
|
Share based compensation |
|
148 |
|
|
|
1,900 |
|
Restructuring & other
non-recurring costs |
|
2,084 |
|
|
|
443 |
|
Depreciation and
amortisation |
|
1,581 |
|
|
|
1,620 |
|
Non-recurring cost of sales
1 |
|
3,850 |
|
|
|
1,881 |
|
Adjusted (Underlying) EBITDA
for continuing operations |
|
(5,735 |
) |
|
|
(9,122 |
) |
Note: (1) Non-recurring cost of sales is related
to one-off loss on Edenvale solar farm in FY23 and Bluegrass
project in FY22.
Reconciliation of Adjusted (Underlying)
Net After-Tax Loss for Continuing Operations and Adjusted
(Underlying) EPS to IFRS Financial Measures
|
|
Twelve months ended June 30 |
(US dollars in thousands except per share
amounts) |
|
2023 |
|
|
|
2022 |
|
Net after-tax loss from
continuing operations |
|
(20,148 |
) |
|
|
(21,429 |
) |
Restructuring & other
non-recurring costs |
|
2,084 |
|
|
|
443 |
|
Non-recurring cost of sales
1 |
|
3,850 |
|
|
|
1,881 |
|
Adjusted (Underlying) net
after-tax loss from continuing operations |
|
(14,215 |
) |
|
|
(19,105 |
) |
|
|
|
|
|
|
Loss from continuing
operations – per share |
|
(0.82 |
) |
|
|
(1.03 |
) |
Restructuring & other
non-recurring – per share |
|
0.08 |
|
|
|
0.02 |
|
Non-recurring cost of sales 1
– per share |
|
0.16 |
|
|
|
0.09 |
|
Adjusted (Underlying)
continuing EPS |
|
(0.58 |
) |
|
|
(0.92 |
) |
Note: (1) Non-recurring cost of sales is related
to one-off loss on Edenvale solar farm in FY23 and Bluegrass
project in FY22.
About VivoPower
VivoPower is an award-winning global sustainable
energy solutions B Corporation company focused on electric
solutions for customised and ruggedised fleet applications, battery
and microgrids, solar and critical power technology and services.
The Company’s core purpose is to provide its customers with turnkey
decarbonisation solutions that enable them to move toward net-zero
carbon status. VivoPower has operations and personnel in Australia,
Canada, the Netherlands, the United Kingdom, the United States, the
Philippines, and the United Arab Emirates.
Forward-Looking Statements
This communication includes certain statements
that may constitute “forward-looking statements” for purposes of
the U.S. federal securities laws. Forward-looking statements
include, but are not limited to, statements that refer to
projections, forecasts or other characterisations of future events
or circumstances, including any underlying assumptions, information
regarding the future economic performance and financial condition
of the Company, the plans and objectives of the Company’s
management, and the Company’s assumptions regarding such
performance and plans. The words “anticipate,” “believe,”
“continue,” “could,” “estimate,” “expect,” “intends,” “may,”
“might,” “plan,” “possible,” “potential,” “predict,” “project,”
“should,” “would” and similar expressions may identify
forward-looking statements, but the absence of these words does not
mean that a statement is not forward-looking. Forward-looking
statements may include, for example, statements about the
achievement of performance hurdles, or the benefits of the events
or transactions described in this communication and the expected
returns therefrom. These statements are based on VivoPower’s
management’s current expectations or beliefs and are subject to
risk, uncertainty, and changes in circumstances. Actual results may
vary materially from those expressed or implied by the statements
herein due to changes in economic, business, competitive and/or
regulatory factors, and other risks and uncertainties affecting the
operation of VivoPower’s business. These risks, uncertainties and
contingencies include changes in business conditions, fluctuations
in customer demand, changes in accounting interpretations,
management of rapid growth, intensity of competition from other
providers of products and services, changes in general economic
conditions, geopolitical events and regulatory changes, and other
factors set forth in VivoPower’s filings with the United States
Securities and Exchange Commission. The information set forth
herein should be read in light of such risks. VivoPower is under no
obligation to, and expressly disclaims any obligation to, update or
alter its forward-looking statements whether as a result of new
information, future events, changes in assumptions or
otherwise.
Contact
Investor Relationsshareholders@vivopower.com
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