Workhorse Group Inc. Q4 FY2024 earnings call

• Launched the new W56 208-inch wheelbase truck in both strip chassis and step van variants in the fourth quarter, with positive customer response and a purchase order for 13 step vans scheduled for Q2 2025.
• Received approval for sale of W750 and W56 step van models in Canada, with demos scheduled for April and May 2025.
• Made significant headcount and spending reductions in 2024 to extend operating runway. Team members took pay cuts, deferred pay, and endured furloughs and staffing reductions while remaining dedicated.
• W56 step van has proven performance in real-world tests, including a 165-mile highway trip with 12% state of charge remaining and a 45-mile daily route with 5,000-8,000 pounds payload for six months with minimal downtime.
• Worked with over 30 certified upfit and body partners, secured contracts like Sourcewell and GSA, and had dealer awards for selling to government fleets.
• Electrified 13 vehicles in their Stables by Workhorse initiative, delivered 154,000 packages to FedEx customers in 2024 with 93%-97% uptime.

For the full year 2024, sales net of returns and allowances were $6.6 million, a decrease of $6.5 million from 2023's $13.1 million. Cost of sales was $28.2 million in 2024, down from $38.4 million in 2023. SG&A expenses in 2024 were $42.5 million, a decrease of $13.1 million from 2023's $55.6 million. R&D expenses in 2024 were $9.1 million, down from $24.5 million in 2023. Net loss for 2024 was $101.8 million compared to $123.9 million in 2023. The company had a total working capital of $8.2 million as of December 31, 2024, including $4.6 million in cash and cash equivalents, net accounts receivable of $500,000, inventory net of reserves of $41.8 million, and accounts payable of $11.5 million.

• Given uncertainty in the EV landscape, Workhorse will not provide specific annual revenue or guidance at this time. They will focus on reducing costs, increasing cash, and maintaining financial runway to achieve strategic goals.

• Regulatory pauses such as California withdrawing its waiver request to the EPA and temporary freeze on federal fleet procurement creating uncertainty in the marketplace.
• Uncertain market readiness for commercial EV step vans at scale despite positive product performance and fleet commitments.
• External factors like changing government mandates, tariffs, and customer EV purchasing plans outside of the company's control.