Workhorse Group, Inc.

Ladies and gentlemen, greetings and welcome to Workforce Group's second quarter 2021 investor conference call. As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Workforce Group's Vice President of Finance, Tony Furey.

Sir, you may begin. Thank you, Operator, and good morning, everyone. We appreciate you taking the time to join us for our call. Before the market opened, we issued a press release with our results for the second quarter ended June 30th, 2021, a copy of which is in the Investor Relations section of our website. We also released our Form 10-Q this morning. I'm going to turn the call over to our CEO, Rick Dauk, in a few moments. And Rick will give you an update on our business. After that, our CEO, Steve Schrader, will walk us through the financial results for the quarter. But before we begin, I want to call to your attention our Safe Harbor provision for forward-looking statements that is posted on our website and is part of our quarterly update. The Safe Harbor provision identifies risk factors that may cause actual results to differ materially from the content of our forward-looking statements. Our 2020 Form 10-K and other periodic filings on file with the SEC provide further detail about the risk factors related to our business. And with that, We'd like to turn the call over to our CEO, Rick Douck. Rick?

Thanks, Tony, and thank you to all who are joining us for today's call. Let me start off by thanking our board of directors for giving me the opportunity to lead the Workhorse team as we take the next step in our journey from tech startup to a real-world operating company. I'd also like to thank my predecessor, Dwayne Hughes, for his leadership of the company over the past two-plus years and his outstanding support of me during our transition process. As most of you know, while I'm new to Workhorse, I am not new to the automotive industry, EV technology, or the last mile commercial vehicle delivery space. My first day here at Workhorse was August 2nd, and as you can see on slide one, it's been a very busy week. In the past seven days, we have conducted board meetings, held three town hall events with our workforce, toured our Union City factory, taken test drives in two of our delivery vehicles that are just like the one you can see on slide two, I've witnessed drone package delivery test flights. I've interviewed the entire executive leadership team, held introductory calls with our key customers, and laid out a plan for me to get fully oriented to the company by the fourth quarter of this year. I've also secured housing and moved to downtown Cincinnati. What I have seen, heard, and experienced in the last week confirms exactly why I decided to get off the bench and join the Workhorse team. With that said, please turn your attention to slide three. As you can see, we are the clear technology leaders in the class three to five last mile delivery segment, both for electrified vehicles and drones. Our backlog is real and stands today at nearly 8,000 vehicle orders that are confirmed with standard vehicle purchase agreements, which include typical terms and conditions. Slides four and five show our Metron data. We have 381 vehicles on the road and in the hands of our customers operating in 21 states with over 8 million miles of real-world driving experience. Metron can provide a multitude of operating data both to us and our customers that allows us to gain data and provide users with increased vehicle efficiency. And most importantly, we have a capable team of associates from the C-suite to the plant floor who are dedicated and focused on becoming the unquestioned market leader in the last mile delivery truck and aerospace markets. That being said, we need to overcome some growing pains as we make the transition from a tech startup to a full-blown operating company. We have a lot of work to do around vehicle designs, bill of material costs, and efficient lean manufacturing operations. areas where I've spent most of my career over the past three decades. I'm excited to be here and look forward to digging in and learning more about our company. Let me now provide a few quick updates on our business units. Let me turn to our truck business first, where we have made significant improvements in our production process. Year to date, we have produced over 133 vehicles, both for our own use as a test fleet and for select customers. Fourteen of those trucks were delivered in the second quarter, and we anticipate the remainder to be leased or sold to niche markets within the next 12 months. In building these vehicles, we have learned valuable lessons about what we can do to make our C1000 series vehicles easier to produce and even better value for our customers. Our initial production run has confirmed the excitement in the market for our C1000 product, which we have shown to existing customers and dealers and are beginning to deliver in limited quantities. What is clear from initial customer feedback is that we need to further increase the payload capacity of our vehicles. Although there are niche market opportunities for the lower payload vehicle, those opportunities are limited. The majority of our customers need a higher payload vehicle, which serves a much larger market segment. Our engineering teams are already hard at work on the revised designs of the C1000. Meanwhile, we can continue with a limited level of production for customers, where our current payload is adequate for those who want to road test one of the few, if not only, electrically powered commercial vehicles in our market that are available to them now. As I said earlier, Workforce is making the transition from an advanced technology startup to a leading manufacturer of last mile delivery vehicles, and that is not always an easy journey. I've been through many manufacturing transitions in the past, and I know what it takes to be successful. We recognize that there is a lot of work still to be done and likely difficult decisions ahead to position our company for long-term success. I look forward to working with our team, our valued customers, and industry partners as we take Workhorse into the next phase of vehicle development and production planning. We will have a revised business and operating plan for our commercial vehicle business by the next earnings call. Let me provide a quick sales and marketing update. We have nearly 8,000 confirmed orders with customers, most of whom I spoke with last week. Thankfully, they are being quite patient with us as we work through our internal design and production challenges. We continue to receive significant customer and market interest due to the recent purpose-built tour and the personal efforts of the entire Pritchard family group enterprise in making that cross-country campaign such a success. Taking full advantage of the increased interest generated, we will be launching a rebranding campaign this quarter, which will include a new website, additional show trucks that will make their way across numerous high visibility events throughout 2021, as well as unveiling our customer experience and training center right next to our manufacturing facility in Union City, Indiana. Turning to slide six, our aerospace team has had a lot to do this quarter. And I have a lot of work ahead of me to better understand both the technical and commercial potential of our industry-leading drone delivery technologies. Our goal is to develop a system that safely and reliably carries a meaningful payload, a significant distance, and then certify that system under FAA's regulations. We are making progress down that design path. Our team is routinely in the field conducting test flights to validate our designs, and those tests are going quite well. This quarter, our aircraft demonstrated the endurance we need and the ability to fly multiple sorties in quick succession. Safe, reliable flying, adequate endurance on a flight, and the ability to fly many times in a duty day are the key elements of any system that supports commercial package delivery service. In the second quarter, we flew our system more than 20 missions in a duty day, validating our design and our ability to hit the op tempos the market will demand. Our work with the FAA is moving forward. The FAA has assigned us a project manager and a team of subject matter experts to work with on the certification process. There is new FAA guidance which may stretch certification for some systems in the pipeline, including ours. From our point of view, the FAA is working hard to strike a healthy balance between public safety and the fielding of new technologies as quickly as possible. With that, I'll turn the call over to our CFO, Steve Schrader, to discuss our second quarter financial results. Steve?