Vicinity Motor Corp.

Greetings and welcome to the Vicinity Motor Corps' fourth quarter and full year 2021 earnings conference call. At this time, all participants are in a listen-only mode. A question and answer session will follow the formal presentation for telephone participants. 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 Corps. William, the floor is yours.

Thank you, operator, and good morning, everyone. I'm pleased to welcome you to today's fourth quarter and full year-end 2021 earnings conference call. The fourth quarter of 2021 and subsequent period was marked by continued order momentum across our continually growing expanding product portfolio, combined with multiple strategic partnerships and agreements to expand our breadth and depth as a company. While revenues from our transit bus business are at times irregular and we see some periods of lower deliveries, our foundation building in 2021 has positioned us with the capability to deliver our backlog of over 100 million Canadian in 2022. This is a significant accomplishment made possible through our Tier 1 strategic partnerships and the continued expansion of our all-electric product line, which has positioned Vicinity as an emerging leader in the EV transit vehicle sector. The highly successful rollout of our VMC 1200 EV truck for which we already have over 250 orders from several dealers across Canada will help smooth out the fluctuating revenues from our transit bus business. This supplemented by partnerships with EAVX for EV chassis sales and sales of our optimal EV vehicles that we maintain exclusive license to, providing additional revenue streams that are less correlated to our core bus business. To prepare for the robust growth we see ahead, we have taken steps to shore up our supply chain in this time of uncertainty. Chiefly, we have secured a 600 vehicle battery supply agreement with Proterra, a leading EV battery systems provider. supplementing our supply from various other providers such as BMW and Electrovia. These steps are taken with the goal of eliminating any single point of failure within our battery supply chain, a common pain point for many EV manufacturers we're facing. Taken together, we enter into 2022 with a strong foundation for growth. The land grab for the EV market share underway and we are well positioned to gain traction throughout through our long-standing partnerships with North American transit agencies and expanding continent-wide dealer network during the quarter and into the new year we have received several hundred orders for EVs reflecting the rapid diversification of our portfolio in this EV space we ended the year with a fortified balance sheet to support our growth initiatives, supplementing our cash position and our Canadian $20 million line of credit with strategic financings to support product line expansion and construction of our Buy America compliant US assembly facility in Ferndale, Washington. Construction of our Ferndale facility is on track and we expect to begin initial shipments in the second half of this year. allowing us to further penetrate the U.S. market with an American-built offering. With that, I'll now turn it over to Dan to review the financial results for our quarter and year-ending December 31st, 2021. Dan?

Thank you, William. Good morning, everyone. I will keep my portion to a brief review of our financial results. A full breakdown is available in the press release and MD&A that crossed the wire before market opened today. Please note that all figures will now be reported in U.S. dollars, unless stated otherwise. In addition, 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 fiscal year 2021 MD&A, which will be available on CDAR. Revenue in 2021 grew to $41.7 million, a 113% increase. as compared to revenue of $19.6 million in 2020. Revenue in the fourth quarter of 2021 totaled $2.3 million, as compared to $3.5 million in the fourth quarter of 2020. Gross margin in 2021 grew 64% to $4.2 million, or 10% of revenue, as compared to $2.6 million, or 13% of revenue in 2020. Gross margin in the fourth quarter of 2021 totaled negative 0.3 million as compared to 1.7 million in the fourth quarter of 2020. Gross margins were affected by sales mix as well as the loss on disposal of eight buses sold from the company's lease pool relative to the low volume of buses sold in the fourth quarter. Cash provided by operating activities in 2021 totaled $3.6 million. as compared to cash used in operating activities of 5.7 million in 2020. Net loss in 2021 was $7.3 million, or negative 24 cents per share, as compared to a net loss of 3.2 million, or negative 13 cents per share, in 2020. Net loss in the fourth quarter of 2021 totaled 4.8 million, or negative 14 cents per share, compared to a net loss of 0.4 million or negative 0.2 cents per share in the fourth quarter of 2020. Adjusted EBITDA loss in 2021 totaled $2.7 million as compared to an adjusted EBITDA loss of 1.6 million for 2020. Adjusted EBITDA loss for the fourth quarter of 2021 totaled 2.2 million as compared to an adjusted EBITDA $0.2 million in the fourth quarter of 2020. Cash and cash equivalents as of December 31, 2020, totaled $4.4 million, as compared to $1 million as at December 31, 2020. Subsequent to the close of the fourth quarter, the company fortified its balance sheet through a $12 million financing to fully fund the Ferndale Washington facility. in addition to being awarded a Canadian $2.6 million non-repayable grant from a Canadian government foundation. In summary, our company is in a strong position. We have a robust balance sheet, are well positioned to make sustained revenue growth, and the fundamentals of our operations are very positive. I'd now like to pass it back to William to offer some closing remarks, after which we will begin our question and answer session.