Workhorse Group Reports Third Quarter 2019 Results
CINCINNATI, Nov. 8, 2019 /PRNewswire/ -- Workhorse Group Inc. (NASDAQ: WKHS) ("Workhorse" or "the Company"), an American technology company focused on providing sustainable and cost-effective electric-mobility solutions to the transportation sector, today reported financial results for the third quarter ended September 30, 2019.
Third Quarter and Recent Operational Highlights
"In the third quarter we continued to make considerable progress toward our goal of achieving initial production with our CSeries last-mile electric delivery vehicles," said Workhorse CEO Duane Hughes. "While we are laser-focused on achieving that near-term goal, we are also taking definitive steps, through strategic partnerships and licensing of our IP portfolio, that have us positioned for long-term sustainability and growth. More specifically, through our recently announced IPLA with Lordstown Motors Corp., we have successfully acquired non-dilutive equity with the added potential for meaningful additional revenue streams through licensing, royalties, and engineering services from LMC. Having an affiliated company in LMC, with their level of automotive production capacity, affords Workhorse a footprint unrivaled in commercial electric truck manufacturing. Looking ahead, we remain confident in our ability to begin initial production during the current calendar year with a sequential ramp in production, and delivery, starting in 2020. Put together, Workhorse occupies its strongest position to-date, both operationally and financially."
Third Quarter 2019 Financial Results
Selling, general and administrative expenses decreased 24% to $2.6 million from $3.4 million in the same period last year. The decrease in selling, general and administrative expenses was primarily due to decreased spending in areas such as marketing as well as decreases in other employee-related costs.
Research and development expenses increased 13% to $1.6 million from $1.4 million in the third quarter of 2018. The increase in research and development expenses was due primarily to increased spending on prototype development, which was partially offset by lower consulting costs.
Total operating expenses decreased 13% to $4.2 million from $4.8 million in the same period last year. The decrease in total operating expenses was due to the lower SG&A spend previously mentioned, which was offset by the higher R&D spend also just mentioned.
Net loss in the third quarter was $11.5 million, compared with a net loss of $5.5 million in the third quarter of 2018. The greater net loss was due to higher interest expense in the third quarter of 2019 compared to the third quarter of 2018. Interest expense in the current year period included a $4.0 million mark-to-market adjustment compared to a $(1.5) million mark-to-market adjustment in 2018 for warrants issued to lenders as well as a higher debt load in Q3 2019.
As of September 30, 2019, the company had cash, cash equivalents and short-term investments of $9.3 million compared to $1.5 million as of December 31, 2018.
Workhorse management will host the presentation, followed by a question and answer period.
U.S. dial-in: 877-407-8289
Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact Gateway Investor Relations at 949-574-3860.
The conference call will be broadcast live and available for replay here and via the Investor Relations section of Workhorse's website.
A telephonic replay of the conference call will be available after 4:00 p.m. Eastern time on the same day through November 14, 2019.
Toll-free replay number: 877-660-6853
About Workhorse Group Inc.
Investor Relations Contact:
Matt Glover and Tom Colton
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SOURCE Workhorse Group Inc.