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Mar 31, 2021
Workhorse Q1 2021 Earnings Report
Workhorse reported first quarter 2021 results, marked by increased sales and strategic developments, but also a significant net loss due to a reduction in the fair value of its investment in Lordstown Motor Corporation.
Key Takeaways
Workhorse Group reported a significant increase in sales for Q1 2021, driven by increased truck deliveries. However, the company experienced a substantial net loss due to a non-cash reduction in the fair value of its investment in Lordstown Motor Corporation. Despite production bottlenecks, Workhorse is taking steps to improve production and solidify its supply chain.
Sales increased to $521,000 compared to $84,000 in the first quarter of 2020, driven by increased truck deliveries.
Net loss was $120.5 million, compared to net income of $4.8 million in the same period last year, primarily due to a non-cash loss related to the reduction in fair value of the Company’s investment in Lordstown Motor Corporation.
The company produced 38 C-Series vehicles year-to-date, more than doubling the number produced in comparison to the combined previous three quarters.
Workhorse entered into a strategic development agreement with EAVX to expand its product line and a supply agreement with Coulomb Solutions, Inc. for battery systems.
Workhorse
Workhorse
Forward Guidance
Workhorse adjusted its 2021 production estimate to 1,000 units, focusing on quality control and supply chain improvements to position the company for increased volumes in 2022 and beyond.
Positive Outlook
- Solidified inspection processes for quality control.
- Grown production workforce significantly.
- Bolstered supply chain with the addition of another battery supplier in CSI/CATL.
- Made enhancements to customer service processes through an improved, end-to-end approach.
- Proactive steps taken to build volumes and ensure consistent production.
Challenges Ahead
- Bottlenecks within the global supply chain.
- Offshore shipping delays of commodity raw materials and components.
- Initial stages of production limited capacity.
- Adjusted 2021 production estimate to 1,000 units.
- Experienced a step function improvement in production later than planned.