The Lion Electric Company Common Shares

Good morning, everyone. Welcome to Lion Electric's first quarter 2024 results conference call. At this time, all participants are in a listen-only mode. A brief question and answer session will follow the formal presentation. As a reminder, this conference call is being recorded. I would now like to turn the call over to Isabel Ajay, Vice President, Investor Relations and Sustainable Development. Please go ahead, Ms. Ajay.

Good morning, everyone. Welcome to Lions first quarter 2024 results conference call. Today, I'm here with Marc Bédard, our CEO funder, Nicolas Brunet, our president, and Richard Coulombe, our chief financial officer. Please note that our discussion may include estimates and other forward-looking information and that our actual results could differ materially from those implied in any such statements. We invite you to review the questionnaire language in this morning's press release and in our MDMA, which contains important information regarding various factors, assumptions, and risks that could impact our actual results. With that, let me turn it over to Marc to begin.

Marc? Thank you, Isabelle. Good morning, everyone. Thank you for joining us today to discuss Lion Electric's performance for the first quarter of 2024. Q1 was marked by significant commercial and operational achievements we have been able to accomplish despite important challenges, mostly related to the timing of some subsidy programs. Let me start by aligning some of our achievements in Q1. The Canadian ZDTF fund approved the first sizable application for 200 buses for which we have delivered 50 buses in Q1. We started delivering our Lion 5 trucks equipped with our Lion MD battery packs, and we anticipate a gradual increase in Lion 5 production throughout the rest of the year as we fulfill orders and bolsters our market presence. We started the deliveries of our Lion D-School buses manufactured at our Joliet facility. We are planning the commercialization of our Lion 8 tractor truck this summer, and we will make its formal commercial introduction at the ACT conference in Las Vegas in two weeks. Our Lion 8 tractor will be equipped with our Lion battery HD pack, a state-of-the-art 105 kilowatt hour pack. The commercialization of our Lion 8 tractor truck expected this summer marks the end of our new model development, allowing us to be fully focused on our vehicle optimization, including cost reduction. Q1 was also the first quarter within the last few years with almost no capex investment, allowing us to capitalize on our previous investments made in our three factories and be fully focused on manufacturing process improvements and supply chain optimization. Lastly, our expertise has been recognized with the prestigious M-Hub Chicago's Manufacturer of the Year Award. that honors manufacturers and organizations for being innovative and focusing on economic growth. To date, we are proud to report that over 2,000 of our vehicles are on the road and have collectively driven 25 million miles, metrics that demonstrate Lion's leadership in the medium and heavy-duty electric world. On the financial front, Q1 revenues remain steady year over year, with margins impacted by initial increased costs related to the introduction of our Lion 5 and Lion D new models and the integration of our Lion batteries, as previously communicated. While we are pleased with the first ZDTF approval and the deliveries of 50 buses in Q1 under this program, revenues in Canada continue to be significantly impacted by the delays and challenges associated with the granting of subsidies related to the ZDTF program. This approval of 200 electric buses is a great news and definitely a step in the right direction, but this represents only a fraction of the program's potential. Revenues in the U.S. were largely impacted by the timing of orders and deliveries tied to the EPA program, being in a transition phase between two funding rounds for this $5 billion program that is crucial for advancing electrification in this market. In response to these timing challenges and to safeguard our liquidity, we continue to proactively make difficult but necessary decisions, including implementing additional cost control measures, such as right-sizing our workforce. Combined with the measures announced late last year and early this year, we estimate that these initiatives will result in annual IELTS cost savings of $40 million. Going forward, we are confident that the recent announcement of new funding programs, such as the additional $1 billion allocation under the EPA's Clean Heavy Duty Vehicles Grant Program, along with the renewal of Canadian programs, such as ECO-Camionage and the Quebec School Bus Subsidy Program, will positively impact orders and deliveries. For the rest of the year, our focus remains on growing our order book and accelerating deliveries. while diligently managing liquidity and controlling costs, including significant improvement of our working capital now that the supply chain crisis is behind us. Nicolas will now provide insights into our commercial performance.