Accelerates revenue growth and
commercialization as average daily production rates increase
Reiterates full-year 2022 revenue guidance
supported by growing diversity of customer relationships across
previously untapped markets
Romeo Power, Inc. (“Romeo Power” or the “Company”) (NYSE: RMO),
an energy technology leader delivering advanced electrification
solutions for complex commercial vehicle applications, today
announced its financial results for the fiscal first quarter ended
March 31, 2022.
Quarterly Financial Highlights
- Delivered total revenues of $11.6 million, in-line with the
Company’s annual expectations
- Supported by product revenues of $11.4 million, an increase of
$10.8 million compared to the first quarter 2021
- Revenue growth was driven primarily by increased delivery
levels, as the Company continued to satisfy major supply contracts
and expanded production capacity
- Captured improved fixed cost leverage and manufacturing scale
as production volumes continue to increase
- Current backlog of $412.0 million based on minimum purchase
commitments as of quarter end
Recent Business Updates
- Continued to expand scope of Romeo Power’s total addressable
market, pursuing a broad range of potential customer relationships
across previously untapped markets, with expanded vehicle types and
electrification opportunities
- Selected by a U.S. manufacturer of Low-Speed Electric Vehicles
(LSEVs) as the sole provider of lithium-ion batteries for its next
generation vehicle
- Shipped first production pedigree packs to a key customer that
manufactures fully electric heavy-duty commercial vehicles
- Forged relationship with bus and heavy-duty truck EV powertrain
manufacturer, Wrightspeed Inc., to build “Powertrain in a Crate”
kits, using Romeo Power’s high-capacity battery pack and module
technology
- Awarded the first phase of a multi-phase commercial program
with Indigo Technologies, an automotive OEM specializing in
lightweight electric vehicles for rideshare and delivery
driving
- Announced a three-year extension of an existing supply
agreement with one of Romeo’s long-standing customers, with a
minimum contractual commitment valued at approximately $17 million
and additional upside potential over the same time period
- Delivered units to four new pilot customers, two of which were
previously restricted prior to the acquisition of the Company’s
former joint venture earlier this year
- Accelerated growth and commercialization by increasing 2022
average daily module production rates by up to 75% over the fourth
quarter of 2021
- Added a third shift to Vernon, CA facility to support execution
against the Company’s current backlog
- Drove significant operations and production throughput
enhancements by continued focus on process improvement and
manufacturing capacity expansions
- Met major milestones in the transition of operations to the
Company’s new state of the art manufacturing facility in Cypress,
California
Management Commentary
Susan Brennan, Chief Executive Officer of Romeo Power,
commented: “The first quarter of 2022 marked solid progress and a
continuation of the momentum we began driving in the second half of
last year. We accelerated our commercial production ramp and
increased daily production rates substantially. This allowed for
improved deliveries of our leading battery pack technology to
customers, thus positioning our Company for continued operational
and commercial success. These improved production rates and
throughput have not only been crucial in establishing and
supporting the foundation for our growth trajectory, but have also
allowed Romeo to capture scale and drive a meaningful decline in
operating costs relative to our revenues. We expect to continue
benefitting from our enhanced operating capabilities and improved
processes as we move closer to having all of our operations and
R&D under one roof at our state of the art facility in Cypress,
California.”
“On the commercial front, we have also made meaningful strides
to support our growth and corporate development. In the first
quarter we successfully finalized a multi-year supply agreement
extension and enhancement with a leading commercial vehicle
customer, entered into a new multi-phase commercial program with an
automotive OEM to power rideshare and delivery vehicles, and began
shipping the first production of 80 kWh pedigree packs to a key
customer manufacturing heavy-duty EVs. We are encouraged by the
traction we are gaining in attracting new customers and pilot
programs, while opening up discussions with a broad range of other
vehicle providers that are interested in how our leading battery
technology and battery management systems can create value in the
rapidly expanding market for electrification,” said Brennan.
Brennan concluded, “While we made marked strides executing
against our areas of immediate focus, we remain committed to making
the necessary steps to best position the Company for long-term
success and shareholder value creation. We will remain diligent in
the refinement of our operational performance, establishing
operational processes and capacity enhancements that will
facilitate our production and further strengthen our revenue
trajectory. We have leading proprietary technology that is being
recognized by multiple industries, and we will leverage that
superior performance and capabilities into improved value and
financial performance alongside the quickly expanding market for
electrification and EV battery technology. 2022 will be a
transformative year for Romeo Power, and we look forward to
updating you on the exciting progress we are making as we power the
next generation of electric vehicles.”
Liquidity and Balance Sheet
- The Company ended the first quarter with cash and cash
equivalents and investments of $66.9 million
- Completed acquisition of BorgWarner’s interest in the joint
venture between Romeo Power and BorgWarner during the quarter for a
total consideration of approximately $37 million, including cash
costs to close the transaction
- Raised approximately $25 million through common stock standby
equity line of credit during the quarter
- Continue to pursue additional equity financing sources to
complement previously announced common stock standby equity line of
credit with Yorkville Advisors
2022 Outlook
Based on the Company’s current backlog and commercial outlook,
Romeo Power reaffirmed the following outlook for fiscal year 2022
ending December 31, 2022:
- Total Revenue to range between $40 million to $50 million
Kerry Shiba, Chief Financial Officer of Romeo Power, concluded,
“Given our commercial momentum and growing diversity of
electrification opportunities, we are reaffirming our previously
announced expectations for between $40 to $50 million of revenue in
fiscal 2022. While the completion of the purchase of our prior
joint venture was a significant use of capital during the period,
it brought us full control of our valuable intellectual property,
as well as our research and development focus. It also has allowed
us to pursue a broader range of strategic and customer engagements
that were previously restricted during our prior partnership, which
is evidenced by the accelerated pace of commercial announcements
we’ve had over the last few months. During the quarter, we
continued to make thoughtful investments in the business, focused
on supporting our growing commercial opportunities and
strengthening the foundation for long-term growth. This included
the buildout of our new Cypress, CA facility, and the addition of
critical production and commercial personnel. To support these
continued efforts, we have filed our proxy statement for the 2022
annual meeting of our stockholders, which includes two
capital-related proposals that are important to support Romeo’s
path forward and future growth. We’ve made strong progress in
revitalizing the foundation of our organization in a short period
of time, and believe we remain well positioned to help our growing
customer base leverage our valuable technologies in the
electrification and clean technology ecosystem.”
Conference Call Information
Romeo Power will host a conference call to discuss these
financial and operational results at 2:00 p.m. U.S. Pacific Time
(5:00 p.m. U.S. Eastern Time), on May 9, 2022. Participating on the
call will be Susan Brennan, President and Chief Executive Officer,
Kerry Shiba, Chief Financial Officer, Anne Devine, Chief Operating
Officer, Dr. AK Srouji, Chief Technology Officer, and Lauren Webb,
Chief Strategy and Commercial Officer of Romeo Power. To access the
conference call, parties should visit the events section of the
Investor Relations website at https://investors.romeopower.com/. A
recording of the webcast will also be available following the
conference call.
About Romeo Power, Inc.
Founded in 2016 and headquartered in Los Angeles, California,
Romeo Power (NYSE: RMO) is an energy technology leader delivering
advanced electrification solutions for complex commercial vehicle
applications. The Company’s suite of advanced battery electric
products, combined with its innovative battery management system,
delivers the safety, performance, reliability and configurability
its customers need to succeed. To keep up with everything Romeo
Power, please follow the Company on social media @romeopowerinc or
visit www.romeopower.com.
Disclosures & Forward Looking Statements
Romeo Power files reports with the Securities and Exchange
Commission (the “SEC”), which are available on the Company’s
website under “Investor Relations” free of charge. This includes
Annual Reports on Form 10-K, Quarterly Reports on Form 10-Q,
Current Reports on Form 8-K and amendments to those reports as soon
as reasonably practicable after the Company electronically files
such materials with or furnishes them to the SEC. The SEC also
maintains an Internet site that contains Romeo Power’s reports,
proxy and information statements, and other information at
www.sec.gov.
Certain statements in this press release may constitute “forward
looking statements” within the meaning of the “safe harbor”
provisions of the United States Private Securities Litigation
Reform Act of 1995. When used in this press release, the words
“estimates,” “projected,” “expects,” “anticipates,” “forecasts,”
“plans,” “intends,” “believes,” “seeks,” “may,” “will,” “should,”
“future,” “propose” and variations of these words or similar
expressions (or the negative versions of such words or expressions)
are intended to identify forward-looking statements. These
forward-looking statements, including, without limitation, express
or implied statements concerning Romeo Power’s ability to develop
or sell new products, or to pursue customers in new product or
geographic markets, Romeo Power’s expectations regarding its future
financial performance, the demand for safe, effective, affordable
and sustainable EV products, Romeo Power’s ability to produce and
deliver such products on a commercial scale, and Romeo Power’s
expectations that its customers will adhere to contracted purchase
commitments on the currently expected timeframe are not guarantees
of future performance, conditions or results, and involve a number
of known and unknown risks, uncertainties, assumptions and other
important factors, many of which are outside Romeo Power’s
management’s control, that could cause actual results or outcomes
to differ materially from those discussed in the forward-looking
statements. Important factors, among others, that may affect actual
results or outcomes include: Romeo Power’s ability to execute on
its plans to develop and market new products and the timing of
these development programs; Romeo Power’s ability to increase the
scale and capacity of its manufacturing processes; Romeo Power’s
estimates of the size of the markets for its products; the rate and
degree of market acceptance of Romeo Power’s products; the success
of other competing technologies that may become available; Romeo
Power’s ability to identify and integrate acquisitions; Romeo
Power’s potential need for and ability to secure additional
capital; the performance of Romeo Power’s products and customers;
potential litigation involving Romeo Power; demand for battery
cells and supply shortages; the potential effects of COVID-19; and
general economic and market conditions impacting demand for Romeo
Power’s products. You should carefully consider the foregoing
factors and the other risks and uncertainties described in the
Company’s filings with the SEC. If any of these risks materialize
or our assumptions prove incorrect, actual results could differ
materially from those implied by our forward-looking statements.
Forward-looking statements speak only as of the date they are made.
Readers are cautioned not to put undue reliance on forward-looking
statements, and Romeo Power undertakes no obligation to update or
revise any forward-looking statements, whether as a result of new
information, future events or otherwise, except as required by
law.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220509006126/en/
For Investors: Joe Caminiti or Ashley Gruenberg Alpha IR
Group RMO@alpha-ir.com 312-445-2870
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