GreenPower Motor Company Inc. Q3 FY2025 earnings call

• Fraser Atkinson noted improvement in gross profit, growing demand for electric school buses driven by health concerns, driver shortage, and grid resiliency. GreenPower is the only OEM with purpose-built Class IV Type A and Type D school buses.
• Brendan Riley discussed increasing output from West Virginia facility, set to deliver 1 BEAST per week with production to rise to 2 per week by April, added James Redd as West Virginia production manager. Also, finalized plans to consolidate California operations into one facility in Riverside for better collaboration, cost savings, and efficiency.

For the three months ended December 31, 2024, GreenPower generated revenue of $7.2 million. Revenue was from the sale of 13 BEAST Type D all-electric school buses, 1 Nano BEAST Type A school bus, 14 EV Star model vehicles, leases, parts, and truck body division. Cost of sales was $6.2 million, resulting in gross profit of approximately $1.05 million or 14.6% of revenues. Gross profit improved due to BEAST, Nano BEAST, and EV Star sales, partially offset by lower margins from truck body division and West Virginia operations.

• Management expects gross profits to improve over time as West Virginia facility reaches higher output.
• Consolidation of California operations is expected to lead to improved management oversight, lower G&A expense, and better gross profit margin over time.
• Continues to utilize EDC revolving credit facility and letters of credit for production funding.
• Net proceeds from October's stock offering used for electric vehicle production, product development, and general corporate purposes.

• Political uncertainty affecting federal and state incentive programs for electric school buses.
• Overcapacity in the truck body division leading to lower demand and impact on gross profit.
• Dependence on external funding sources like EDC revolving credit facility and letters of credit which could be affected by market conditions.

Q: Could you comment on the mix of state funding and update on federal funding?

A: At federal level, fluid with need for more time to see shakeout; at state level, strong support in California with $500 million for electric school buses and New York's $500 million program.

Q: Explain the sequential increase in general and administrative expenses?

A: Primarily due to headcount increases, but expect reductions from California consolidation. No significant one-time charges related to consolidation.

Q: How many electric school buses are on the road and performance?

A: Delivered about 10 so far from West Virginia, with measured deployment in areas like Arizona, Oregon, expecting activity in Washington; strong service and support network key for adoption.

Q: What drives throughput in truck body division?

A: Split is third-party vehicles; overcapacity in sector leads to less demand, and consolidation will bring efficiencies by folding into other operations.