Vicinity Motor Corp.

An answer session will follow the formal presentation. As a reminder, this conference is being recorded. Before we begin the formal presentation, I'd like to remind everyone that statements made on today's call and webcast, including those regarding future financial results and industry prospects, are forward-looking and may be subject to a number of risks and uncertainties that could cause actual results to differ materially from those described in the call. Please refer to the company's regulatory filings for a list of associated risks, and we would also refer you to the company's website for more supporting industry information. I would now like to hand the call over to William Treanor, founder and chief executive officer of Vicinity Motor Corp. William, the floor is yours.

Thank you, operator, and good afternoon, everyone. I'm pleased to welcome you to today's third quarter 2021 corporate update conference call. The third quarter of 2021 was instrumental in our foundation building for 2022, having secured exciting new lines of business, namely EV chassis sales alongside EAVX and low floor electric shuttle bus sales through our new partnership with Optimal EV. While revenues from our transit bus business are at times irregular, and see some periods of lower deliveries, as illustrated with this quarter. For our financial guidance we've released, we're on a trajectory to realize over $140 million in revenue next year, marking what will be a record-breaking year for vicinity by any measure. Our entry into the high-demand electric truck and shuttle bus market is expected to fill the gaps for periods of lower transit bus deliveries in the future. We are leveraging our strong momentum to accelerate the launch of next generation electric vehicle products, including our breakthrough Vicinity Lightning EV and our new VMC 1200 Class 3 truck. The S1 and E1 cutaway product lines from our strategic partner optimal ev and finally ev sales for upfitting into next generation municipal and delivery vehicles alongside eavx our strategic partner and business unit of north american commercial automotive leader jb point dexter the land grab for ev market share is well underway and we are positioned to gain traction through our long-standing partnerships with North American transit agencies and a continent-wide dealer network. Given the capital needs to fully fund our Washington State manufacturing facility and these exciting new business lines, namely our exclusive North American distributor agreement with Optimal EV and our strategic collaboration for chassis sales alongside EAVX, we've made significant moves towards fortifying our balance sheet in recent months, as well to support some of these exciting new growth initiatives, supplementing our $20 million line of credit with a $10.3 million debt financing and proceeds from a U.S. $17 million underwritten public offering. To support our 2022 financial guidance for revenues of at least $140 million and adjusted EBITDA of at least $10 million, numbers which we believe are conservative and provide room for significant potential upside driven by our continuously strong North American sales momentum, we have appointed respected commercial transportation veteran Brent Phillips, as our Senior Director of Sales in North America. Brent is an incredibly well-networked and talented individual, a perfect example of our ability to create a Tier 1 organization and setting up for an accessible future. We attended key investor industry events in this quarter as well, namely the FNN Network Summer Virtual Event, the H.G. Wainwright 23rd Annual Global Investing Conference, and the LD Micro Main Event on the investor side of things, as well as the CALAC 2021 Autumn Conference and Expo and the APTA Transform Conference and Expo on the industry side, both significant industry trade events where we're showcasing our newest, most advanced products for customers potential customers to familiarize themselves with. Now, with that, I'll turn it over to Dan to review the financial results of this quarter ended September 30th, 2021. Dan? Thanks, William.

Good afternoon, everyone. I will constrain my portion to a quick review of our financial results. Full breakdown is available in our regulatory filings and in the press release across the wire after market closed today. Please note, I'll refer to adjusted EBITDA and other non-GAAP measures. For the calculation of adjusted EBITDA and other non-GAAP measures, please refer to the Q3 MD&A, which is available on CDAR. Revenue decreased 67% to $2.9 million for the three months ended September 30, 2021, as compared to $8.9 million in the three months ended September 30, 2020. The decreased revenue was primarily driven by the delivery of six buses in the corridor. as compared to 20 buses in the third quarter of 2020, reflecting low order intake during the first nine months of the pandemic and delivery delays related to shipping and the global supply chain challenges for certain parts currently experienced in the industry. Revenue grew 128% to $49.3 million for the nine months ended September 30, 2021, as compared to $21.6 million in the nine months ended September 30, 2020. The company delivered 119 buses for the nine months ended September 30th, 2021 as compared to 49 buses for the nine months ended September 30th, 2020. Gross loss totaled $0.7 million or negative 24.9% of revenue in the third quarter of 2021 as compared to a gross profit of 0.6 million or 6.3% of revenue in the same year ago quarter. Gross profit increased to $5.7 million or 11.6% of revenue for the nine months ended September 30th, 2021 as compared to gross profit of $1.2 million or 5.3% of revenue for the nine months ended September 30th, 2020. The margins for the three months ended September 30th, 2021 were negatively affected by the sales of higher than average cost buses and inventory. and the sales of fewer buses compared to the prior year period. The gross profit in the nine months ended September 30th, 2021 was positively affected by sales mix with 2021 deliveries generally having higher margins than those realized in 2020. Net loss for the third quarter of 2021 was 4.8 million or 16 cents per share, negative 16 cents per share. As compared to a net loss of 1.3 million, or negative five cents per share in the same year ago quarter. Net loss for the nine months ended September 30th, 2021 was 3.1 million as compared to a net loss of 3.8 million for the nine months ended September 30th, 2020. Adjusted EBITDA loss for the third quarter of 2021 was $3.5 million as compared to an adjusted EBITDA loss of 0.7 million in the same year ago quarter. Adjusted EBITDA loss for the nine months ended September 30, 2021 was $0.5 million, as compared to an adjusted EBITDA loss of $2.4 million for the nine months ended September 30, 2020. Cash and cash equivalents as at September 30, 2021 totaled $5 million, further fortified through the addition of $10.3 million in debt financing. and the proceeds from a U.S. $17 million public offering subsequent to quarter end. Working capital, as at September 30, 2021, totaled $16.4 million, as compared to $16.7 million, as at December 31, 2020. Our company is in a strong position. We have a strong balance sheet, are well positioned to execute on our robust 2022 financial guidance, and the fundamentals of our operations are very positive. we remain well positioned for future growth. And now let's pass it back to William to offer some closing remarks after which we'll begin our question and answer session.