GreenPower Motor Company Inc. Q1 FY2025 earnings call

• GreenPower has turned an important corner with increased orders and quotes, showing rebound in EV market demand.
• Delivered all-electric purpose built school buses in California with follow-ons in California and Oregon.
• Significant uptick in sales pipeline for all-electric commercial vehicles, including 28 specialty vehicles for Canada, 20 EV Star Cargo Plus and passenger vans, and 30 school buses for California and Oregon.
• Go-to-market strategy includes horizontal market for medium duty Class 4 vehicles and vertical market for school buses.
• West Virginia manufacturing facility is operational, with production capacity to meet national demand.
• Participated in industry events to discuss EV school bus safety, 2030 mandates, and zero emission deployment.
• Introduced EV Star ReeferX, a modern refrigerated box utilizing EV Star Cab & Chassis.

For the period ended June 30, 2024, GreenPower generated revenue of $3 million with a cost of sales of $2.8 million, resulting in a gross profit of approximately $222,000. At quarter end, the company had nearly $14 million in working capital, including $33.7 million in inventory, with $13.4 million being finished goods. The company has significant inventory of EV Star Cab & Chassis, Nano BEASTs, and other vehicles, with many opportunities involving sales of existing finished goods inventory requiring limited additional capital outlays.

• Expect revenue to step up from the most recent quarter through the remaining quarters of the fiscal year due to increased orders, inventory, and production capabilities to meet demand.
• Leveraging existing inventory and production to capitalize on growing market demand for all-electric vehicles.

Q: Can you update on the order book size beyond the specific numbers mentioned?

A: There are follow-on orders for many of the initial orders, with follow-ons having varying approval statuses but significant magnitude.

Q: Talk about natural margins for products, differences between Cab & Chassis, EV Star Cargo Plus, and school buses?

A: Traditionally, gross profit has been in the high teens. Current quarter margins were impacted by limited throughput in West Virginia, but improved throughput will increase gross profit.

Q: Update on finished vehicles and inventory?

A: Largest inventory category is EV Star Cab & Chassis, depleting rapidly; over 40 EV Stars of various types including repossessed/returned; over 10 Nano BEASTs, with additional BEASTs received since quarter-end.

Q: Discuss subsidies in West Virginia?

A: West Virginia provides numerous subsidies including tax subsidies, training program support, and a sale-leaseback on the manufacturing facility.

Q: Availability on EDC facility?

A: Ended the quarter with nearly $2 million available on the $5 million EDC revolving credit facility, with a drawn balance of slightly over $3 million at quarter-end.