Workhorse Group Reports Q2 2024 Financial Results
Workhorse Group Inc. (Nasdaq: WKHS), an American technology company focused on pioneering the transition to zero-emission commercial vehicles, today reported financial results for the second quarter ended June 30, 2024.
Management Commentary
“During the second quarter, we continued to advance our EV product roadmap and worked diligently to gain momentum with prospective customers,” said Workhorse CEO Rick Dauch. The company executed field demonstrations with multiple national fleets, secured new dealer partnerships, and generated interest through a recently awarded contract for procurement in the category of Class 4-8 cab chassis and related equipment. Production for the W56 vehicle is expected to begin in the fourth quarter, with initial orders already secured.
Mr. Dauch concluded, “While we made important progress during the quarter, our financial results reflect significant work ahead. We are optimistic regarding EV adoption rates and are making disciplined decisions to preserve cash and extend our financial runway.”
Executing Strategic and Financial Actions
Key actions taken during the second quarter include:
- Delivering to Customers: The company received a purchase order for 141 W4 CC cab chassis from Kingsburg Truck Sales. However, delays in voucher approval limited revenue recognition that quarter. The company expects substantial revenue recovery throughout 2024.
- Advancing EV Product Roadmap: Workhorse is finalizing engineering and testing for expanding the W56 product offering with a new 1200 cubic feet capacity model expected to be available by year-end.
- Expanding Dealer Network: The recent Sourcewell contract allows Workhorse to extend its reach to government and nonprofit sectors across multiple regions.
- Divestiture of Aero Business: This divestiture, completed in June, is expected to save the company approximately $0.4 million monthly, enabling a stronger focus on commercial electric vehicles.
- Regained NASDAQ Compliance: Workhorse received notification of compliance with NASDAQ's minimum bid price requirement following a reverse stock split in June.
- Conserving Cash: The company continues to manage costs through workforce reductions and other measures, achieving significant cost savings.
Second Quarter Financial Results
For the second quarter of 2024, net sales were $0.8 million, a decline from $4.0 million year-over-year, primarily driven by lower sales of the W4 CC vehicles.
The company's cost of sales decreased to $7.3 million, primarily due to reduced costs in materials and consulting as well as employee expenses resulting from earlier furloughs.
SG&A expenses were down to $12.1 million, and R&D expenses reduced to $2.0 million as a result of lower headcount and consulting costs. Net interest expense was $5.2 million, resulting in a net loss of $26.3 million compared to $23.0 million in the prior year.
Conference Call
Workhorse management will hold a conference call today to discuss these results in detail.
U.S. dial-in: 877-407-8289
International dial-in: 201-689-8341
About Workhorse Group Inc.
Workhorse is focused on providing electric vehicles to the last-mile delivery sector and offers a fleet optimization telematics system fully integrated with its vehicles. For additional information, visit workhorse.com.
Frequently Asked Questions
What were the key financial results for Q2 2024?
Net sales for Q2 2024 were $0.8 million compared to $4.0 million in Q2 2023, reflecting a notable decline primarily due to reduced W4 CC vehicle sales.
What strategic actions has Workhorse taken in Q2 2024?
Workhorse has expanded its dealer network, progressed on EV product enhancements, and successfully managed costs while conserving cash.
How did Workhorse's operating expenses change?
Operating expenses decreased significantly, with SG&A costs reducing to $12.1 million and R&D expenses down to $2.0 million year-over-year.
What impact did the reverse stock split have on the company's NASDAQ listing?
The reverse stock split enabled Workhorse to regain compliance with NASDAQ's minimum bid price requirement.
What is the future outlook for Workhorse?
The company remains optimistic about the long-term market opportunity for electric vehicles, especially in the Class 4-6 work truck segment, anticipating accelerated adoption rates.
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