Twin Vee PowerCats Co.

Welcome to the Twin V PowerCats Co. First Quarter 2022 Investor Call. As a reminder, this call is recorded and all participants are in listening mode. Your speakers for today's program is Joseph Visconti, Chairman of the Board and CEO of Twin V PowerCats Co., and Carrie Gunnarsson, CSO of Twin V PowerCats Co. Before I send the call over to Joseph, please remember that certain statements made during this investor call are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements on this call are statements of historical facts, including statements regarding the company's future operations and financial position, business strategy, and plans and objectives of management for future operations are forward-looking statements. In some cases, forward-looking statements can be identified by terminologies such as believe, may, estimates, continue, anticipates, intends, should, plan, expect, predict, potential, or the negative of these terms or other similar expressions. The company has based these forward-looking statements largely on our current expectations and projections about future events and financial trends that it believes can affect its financial conditions, results of operations, business strategy, and financial needs. These forward-looking statements are subject to a number of risks and uncertainties and presumptions described, including those set forth in our filings with the Securities and Exchange Commission, which are available on our website at www.twinbee.com. You should not rely upon forward-looking statements as predictions of future events. We cannot assure you that the events and circumstances reflected in the forward-looking statements will be achieved or occur. Finally, this conference is being webcast. The webcast will be available in the Investor Relations section of our website at ir.twinvee.com for at least 90 days. Audio cast quality is subject to your equipment, available bandwidth, and internet traffic. If you experience unsatisfactory audio quality, please use the telephone dial-in option. The question and answer session will follow the presentation. Please note that only those that have dialed in via telephone may ask a question. Those listening via webcast will be unable to submit questions unless called on instead. If you would like to ask a question, you may signal by pressing star one on your telephone keypad. I would now turn the call over to Mr. Joseph Visconti. Please go ahead.

Thank you. I am Joseph Visconti, the CEO of Twin V PowerCats. Thank you and good afternoon, and I would thank you for taking the time to participate in our Q1 2022 financial results call. I will start off by providing several Q1 updates on our company's progress and discuss our plans moving forward. Can you hear me? Terry Gunnarsson, our CFO, will then give a financial update on the company, and that will conclude with our Q&A. Twin V PowerCats manufactures and sells a variety of catamaran sport boats here in our Fort Pierce, Florida factory. We currently employ around 145 employees. Through Q1, sustained demand for our products continues. Our backlog of orders remains around 200 boats, and the stocking inventory of our dealers remains at low levels, under 20 boats as of this week. As previously discussed, we are currently manufacturing and selling our GFX model line of twin Vs. With the addition of our new 400 GFX and 260 GFX, Twin V will have a total of eight GFX models available through our dealer network. Twin V's GFX models include the 240 center console, two 24-foot dual consoles, 26, our new 26 center, 228 center consoles, our 34 center console, and our new 40-foot center console. Prices of our boats range from $120,000 for a 24 to over $800,000 for a fully equipped 40-foot GFX. We continue to experience ongoing but manageable supply chain issues. Material and component prices continue to rise. Shipping delays still exist. Windv is dealing with the same supply chain challenges that most manufacturers are facing today. Our purchasing and procurement team really stepped up big time. Our team members are being proactive, chasing down parts, opening new vendor relationships for components and materials, making sure that our assembly line continues to hum. I can report that other than a dozen boats requiring a 350 horsepower motor, we have successfully shipped all completed and finished boats. As you can see, Even with the supply chain challenges, our revenues were still up 83% for the Q. The supply of 350 horsepower motors from Suzuki that powers our 34 and our new 40-foot boats, unfortunately, is not enough to fill the orders we currently have. The good news is that we do have ample supply of motors that power every other Twin V model. To make up for any loss of revenue with a 34 foot, we have increased production of our smaller boats. And you can see from the increase in revenues for Q1 that this strategy has been working. A quick update on our brand new 400 GFX. The fiberglass parts are completed. The boat is being rigged and assembled as we speak. The 400 GFX is the largest twin V produced to date. QNV is hosting an annual dealer meeting July 8th and 9th of this year. It's important that our 400 is in the water and ready to wow our dealers at this July meeting. The dealer meetings is typically where orders are placed for the new model year, so very exciting. As we increase our unit production and add new models to our lineup, the expansion of our national dealer footprint is vital. With that, I would like to mention a recent key hire to Team Twin V. To help lead our sales and marketing expansion, we've hired Mr. John Plante to be Twin V's new national sales director. John will be working hand-in-hand with Lolliball, our in-house dealer liaison, who has single-handedly led the charge of developing our existing dealer network from the time I became involved with this company over six years ago. John Plancy was the COO of Freeman Boat Works, one of the top and leading offshore catamaran boat builders. John comes to us with an extensive knowledge of recreational marine industry. We are super excited to bring on new dealers and begin shipping our twin Vs into new markets such as the Great Lakes, the Ozarks, and along the Northeast seaboard. Now moving on to our electric vehicle manufacturing subsidiary, Forza X1. Our initiative into sustainable marine technologies includes the design, development, and sale of fully integrated affordable electric boats for the masses. Jim LeFou, Forza's president, and Dan Norton, Forza's director of engineers, are doing a phenomenal job. The progress Jim and Dan and the rest of Team Forza are making is simply impressive and very exciting. We have made some big strides at Forza X1. We see a path forward that includes a dedicated factory that is being designed to manufacture up to 1,000 units annually. Now let's start with our Forza outboard motor. Our prototype motor and control system is completed, and we are now in the testing phase. The motor is currently hung on a test bed, 22-foot classic twin V. The outboard motor and control systems are working in functioning order. In a parallel path, The FX-1 center console boat has begun the tooling process. This is also extremely exciting. The tooling is the initial manufacturing process to make the molds that are required to produce and manufacture the final fiberglass parts for the FX-1 model. Our goal is by Q3 of 2022 Forza should have a completed FX1 center console boat fully rigged in the water and starting final testing phase before production. I am excited to announce that we received our first prototype battery from American Battery Solutions or ABS. As you recall in January we announced a major five-year supply agreement with Michigan based ABS for production grade 52 kilowatt high-powered lithium ion batteries that will be used to power Forza FX1 electric boats. This supply agreement is a huge step forward for Forza X1 to distinguish itself as a mass producer of electric boats in the evolving EV marine market. As lithium ion battery supplies remain roadblocked, bottlenecked across the entire EV industry, We are not familiar with any other electric boat manufacturers that have contractually secured access to production level quantities of high powered lithium ion batteries for their electric boats. This is a really big deal for our company. Overall, Forza X1 has made substantial progress since the beginning of the year. We have built a tremendous team of in-house engineers and our laser focus mission is to lead the transition of electrification in the recreational sport boat industry. I hope you enjoyed my presentation. Now let me turn it over to our CFO, Carrie Gunnarsson, who will now give a more detailed review of our financial results from Q1.

Thank you, Joseph. Beginning with the income statement, our revenue for the quarter was up 83% or approximately $2,678,000 from $3,208,000 in 2021 to $5,886,000 in 2022. Our gross profit for the quarter was up 64% or approximately $946,000 from $1,488,000 in 2021 to $2,434,000 in 2022. We continue to monitor the cost of our raw materials and our purchase components and are adjusting our sales price accordingly. Our net loss for the quarter was approximately $1,191,000 compared to net income of $132,000 in 2021. However, in 2021, we did not have either of our subsidiaries. Forza's portion of our net loss was approximately $514,000. The net loss from our core business gas powered boats was approximately $626,000. Further, when we look into our adjusted net loss for the quarter, which excludes non-cash charges, our adjusted net loss for our core business, gas-powered boats, was only approximately $152,000. Our net loss is a reflection of the investment the company continues to make to increase the number of models and the production line capacity. We continue to aggressively recruit experienced production staff and are not only increasing productivity but also efficiency. Our short-term goal of one boat a day will increase our annual production to over 200 boats in 2022, which will add to our financial strength. Turning to the balance sheet, we had cash, cash equivalents, and marketable securities of approximately $11,039,000 as of March 31, 2022. At this time, we believe our cash, cash equivalents, and cash from operations will provide sufficient cash to finance operations. With that, I'll turn the call back over to Joseph.

Thank you, Carrie. In conclusion, I believe Twinbee is coming off a very strong first quarter. We're continuing to see a significant backlog of orders and low dealer inventory. We've also begun production on new boat models that will increase the variety of our product offerings. In addition, we're working on expanding our dealer footprint to allow our products to reach new customers across this country. Based on all this forward momentum, we remain confident in our ability to deliver value to our shareholders and believe the remainder of 2022 and beyond will be an exciting time for Twin V PowerCats and our stakeholders. I want to thank Twin V and Forza One team members. We could not thrive without the many skilled and experienced men and women that come to work every day, build our beautiful boats, and push a marine electrification forward. And finally, I want to thank our shareholders for their support and everyone on the call today for their time and interest in Twin V PowerCats.

I would like to open it up for questions now.

We're going to begin the question and answer session.

To ask a question, you may press star then 1 on your telephone keypad. If you are using a speakerphone, please pick up your handset before pressing the keys. Which are your questions, please press star then 2.

At this time, we'll pause momentarily to assemble our roster. As a reminder, if you have a question, please press star then 1. Looks like we have a question. And our first question comes from Brian Carson from Bank Equity.

Please go ahead.

Thanks Joseph and congratulations on the quarter. I'm just curious how do you see yourself positioned relative to your competitors and how do you see this space continuing to evolve? Thanks.

Thank you Brian. It's a great question. You know we can see continued momentum in the catamaran multi-haul industry. I think it's really taking shape and there's a lot more kind of onesie twosie catamaran boat builders that are appearing at these boat shows on national level. So that shows a lot of excitement in the multi-hull space. And I think that when you're talking about any producer that's building over 100 units annually, there's only a couple, well, there's two companies, WorldCat and Twin V. WorldCat, I believe, builds 330 units annually. Twin V will build over 200 units annually. this year, and this is under the 40 foot segment. So with our new 26 coming online this year and our 40 foot, our largest boat, I think in our current backlog and the excitement, people learning about multi-hull and ride quality and fuel efficiency and all the great attributes that multi-hull boats offer, I think that we're going to continue to grow.

And as another reminder, if you have a question, please press star then 1. Give another minute for any further questions.

Final reminder, star then 1 to join the question queue.

And our next question comes from Keith Van Allen, a private investor.

Please go ahead.

Yeah, hi. Thanks for taking my question. I'm just wondering if you could give me an update on the Forza IPO.

Sure. So the good news is that the SEC gave us a no comment letter about two weeks ago. We're working with our bank, Think Equity, to refine our presentation. Obviously, the market's in a pretty rough condition right now. So You know, think equity is, you know, driving this process. Obviously, the lead bank on our deal. And, you know, what I'm being told, and I think we all know, is we need to start to see the market stabilize a little bit, and then we'll begin our roadshow. But as far as, you know, going through the SEC and NASDAQ with our S-1, you know, that's, we're ready to roadshow. So I think the good news is that we, with these higher gas prices, You know, we see electrification happening all over the world in many different industries. So hopefully this market kind of like figures out what it wants to do so we can get public. But that's not stopping us, by the way. You know, we continue to, Twin V has $11 million in the bank. We continue to push forward. We're doing the tooling on our you know, on our center console, our dual console. We've designed our factory. We're receiving, you know, our orders for our batteries. I mean, so nothing has slowed. I mean, I think the IPO, from a financial perspective, will add, you know, to putting up the factory. Much of that raised capital was to build out a new factory. So, you know, UNV, as you saw, is well capitalized and continues to fund the progress forward. Okay, great.

Thank you very much.

You're welcome.

And a final reminder, if you have a question, please press star, then 1. At this time, I'll now... Pardon me.

At this time, I'll now have to turn the conference back over to Mr. Jesse Visconti for any closing remarks.

I just want to thank everyone for their time, and I want to thank all of Twin V, and everyone have a great day.

Thank you.

The conference is now concluded. Thank you for attending today's presentation. You may now disconnect.