VANCOUVER, British Columbia, Nov. 08, 2021 (GLOBE NEWSWIRE) — Westport Fuel Systems Inc. (“WFS“) (TSX:WPRT / Nasdaq:WPRT) reported financial results for the third quarter ended September 30, 2021, and provided an update on operations. All figures are in U.S. dollars unless otherwise stated.
THIRD QUARTER 2021 HIGHLIGHTS
-
Revenues of $74.3 million, up 14% compared to the same period in 2020, due to the continued recovery of sales volumes in our light-duty OEM businesses since the beginning of the COVID-19 pandemic and $7.1 million revenue from our recently acquired fuel storage business, partially offset by the decrease in the independent aftermarket (“IAM”) business
-
Net loss of $5.8 million and net loss per share of $0.03 mainly due to increased operating expenses, lower government wage-subsidy and support programs, and lower foreign exchange gain
-
Global supply chain challenges and the shortage of semiconductors adversely impacted growth of our HPDI sales, independent aftermarket business, and delayed OEM businesses due to lower production compared to customer demand
-
Awarded our single largest IAM tender bid of €9 Million for the supply of 60,000 LPG systems to NAFTAL, a branch of SONATRACH, the national Algerian Oil & Gas company
-
Published our annual ESG report, featuring 34.4% lower overall GHG emissions (tonnes-CO2e) and reduced GHG intensity by 20.6% year over year
-
Cartesian Capital Group debt converted into common shares of the company
“While this was a challenging quarter for our company as we felt the larger effects of both the ongoing semi-conductor shortage and global supply chain issues across key parts of our business; despite these challenges, market conditions for our company and the potential for our clean, affordable products remain positive and we are still showing an improving trend in our business. Sales of our light-duty LPG and CNG components in Europe showed recovery over last year, we expect continued positive growth in Europe, as well as growth in emerging markets. The heavy-duty business remains fundamentally strong and we anticipate a return to expected full-year growth trend when the semi-conductor shortage challenges are resolved, as market and customer feedback is positive. Demand for heavy-duty vehicles will continue to increase and our HPDI technology, fueled by LNG and RNG today and next by green Hydrogen, is in a key competitive position to expand as OEMs need to act to respond to environmental regulations and meet the demand for clean, efficient, and affordable solutions. Our products will continue to play an important role in the immediate future towards overall carbon reduction in transportation and ensuring a clean and prosperous future for all.”
David M. Johnson, Chief Executive Officer
Third Quarter Financial Highlights Operations
|
CONSOLIDATED RESULTS |
|||||||||||||||||||
|
($ in millions, except per share amounts) |
Over / (Under) % |
Over / (Under) % |
|||||||||||||||||
|
3Q21 |
3Q20 |
9M’21 |
9M’20 |
||||||||||||||||
|
Revenues |
$ |
74.3 |
$ |
65.4 |
14 |
% |
$ |
229.8 |
$ |
168.6 |
36 |
% |
|||||||
|
Gross Margin |
10.1 |
10.0 |
1 |
% |
38.9 |
26.5 |
47 |
% |
|||||||||||
|
Gross Margin % |
14 |
% |
15 |
% |
— |
17 |
% |
16 |
% |
— |
|||||||||
|
Operating Expenses |
18.8 |
13.2 |
43 |
% |
59.4 |
47.8 |
24 |
% |
|||||||||||
|
Income from Investments Accounted for by the Equity Method(1) |
4.1 |
4.6 |
(12 |
) |
% |
18.7 |
14.1 |
33 |
% |
||||||||||
|
Net Income (Loss) |
$ |
(5.8 |
) |
$ |
0.8 |
(802 |
) |
% |
$ |
8.3 |
$ |
(11.5 |
) |
173 |
% |
||||
|
Net Income (Loss) per Share |
$ |
(0.03 |
) |
$ |
0.01 |
(400 |
) |
% |
$ |
0.05 |
$ |
(0.08 |
) |
163 |
% |
||||
|
EBITDA(2) |
$ |
(1.2 |
) |
$ |
4.9 |
(124 |
) |
% |
$ |
14.6 |
$ |
3.0 |
387 |
% |
|||||
|
Adjusted EBITDA(2) |
$ |
(1.4 |
) |
$ |
4.0 |
(135 |
) |
% |
$ |
7.5 |
$ |
6.6 |
14 |
% |
|||||
(1) This includes income primarily from our Cummins Westport Inc. (“CWI”) and Minda Westport Technologies Limited joint ventures.
(2) EBITDA and Adjusted EBITDA are non-GAAP measures. Please refer to GAAP and NON-GAAP FINANCIAL MEASURES for the reconciliation to equivalent GAAP measures and limitations on the use of such measures.
Revenues in 3Q21 increased 14% to $74.3 million in the three months ended September 30, 2021, resulting from higher sales volume and recovery in our light-duty OEM business and the addition of $7.1 million in revenue from our recently acquired fuel storage business, partially offset by the decrease in the IAM business.
WFS reported a net loss of $5.8 million for the quarter ended September 30, 2021, compared to net income of $0.8 million for the same quarter last year. The $6.6 million decrease in earnings was primarily the result of increases in research and development expenditures and general and administrative expenditures, lower foreign exchange gain and increase in income tax expense compared to the prior quarter. Equity income from CWI was $1.0 million lower compared to the same prior year quarter. Government-wage subsidies and support programs received were also $0.9 million lower compared to the same prior year quarter.
WFS recorded negative $1.4 million Adjusted EBITDA for the quarter ended September 30, 2021 compared to $4.0 million. Adjusted EBITDA for the same period in 2020. This was due to increased R&D spending and higher SG&A expenses.
Segment Information
|
SEGMENT RESULTS |
Three months ended September 30, 2021 |
||||||||||||||
|
Revenue |
Operating income (loss) |
Depreciation & amortization |
Equity income (loss) |
||||||||||||
|
OEM |
$ |
48.0 |
$ |
(7.4 |
) |
$ |
2.4 |
$ |
0.3 |
||||||
|
IAM |
26.3 |
0.7 |
0.8 |
— |
|||||||||||
|
Corporate |
— |
(1.9 |
) |
0.1 |
3.8 |
||||||||||
|
CWI – 50% |
41.7 |
5.1 |
0.1 |
— |
|||||||||||
|
Total segment |
116.0 |
(3.5 |
) |
3.4 |
4.1 |
||||||||||
|
Less: CWI – 50% |
(41.7 |
) |
(5.1 |
) |
(0.1 |
) |
— |
||||||||
|
Total Consolidated |
$ |
74.3 |
$ |
(8.6 |
) |
$ |
3.3 |
$ |
4.1 |
||||||
|
SEGMENT RESULTS |
Three months ended September 30, 2020 |
||||||||||||||
|
Revenue |
Operating income (loss) |
Depreciation & amortization |
Equity income (loss) |
||||||||||||
|
OEM |
$ |
37.4 |
$ |
(4.9 |
) |
$ |
2.1 |
$ |
(0.2 |
) |
|||||
|
IAM |
28.0 |
1.7 |
1.3 |
— |
|||||||||||
|
Corporate |
— |
0.1 |
0.1 |
4.9 |
|||||||||||
|
CWI – 50% |
42.2 |
6.3 |
— |
— |
|||||||||||
|
Total segment |
107.6 |
3.1 |
3.5 |
4.7 |
|||||||||||
|
Less: CWI – 50% |
(42.2 |
) |
(6.3 |
) |
— |
— |
|||||||||
|
Total Consolidated |
$ |
65.4 |
$ |
(3.1 |
) |
$ |
3.5 |
$ |
4.7 |
||||||
Original Equipment Manufacturer Segment
Revenue for the three and nine months ended September 30, 2021 was $48.0 million and $138.2 million, respectively, compared with $37.4 million and $90.8 million for the three and nine months ended September 30, 2020. Revenue for the OEM business segment increased by $10.6 million and $47.4 million, respectively. The increase during the current quarter was mainly due to higher light-duty OEM sales volumes, particularly sales to Indian and Russian OEMs, and $7.1 million additional revenue from the recently acquired fuel storage business. The impact of COVID-19 was significant in the prior year period, which was impacted by plant shutdowns combined with lower light-duty OEM sales to German and Russian OEMs. HD OEM revenue was comparable year-over-year and reflects the impact of manufacturing delays caused by the shortage of semiconductors on our initial OEM launch partner. Despite the headwinds from supply chain issues and increases in LNG prices, we expect to see continued growth in HPDI through the remainder of this year as production recovers.
Independent Aftermarket Segment
Revenue for the three and nine months ended September 30, 2021, was $26.3 million and $91.6 million, respectively, compared with $28.0 million and $77.8 million for the three and nine months ended September 30, 2020. Revenue for the third quarter decreased by $1.7 million year-over-year because of a slowdown in sales due to supply chain issues, including semiconductors shortages. Year-to-date, revenues are higher by $13.8 million compared to the same prior year period, mainly due to due to the recovery from the impact of COVID-19 across all markets and growth in the emerging markets offset by the aforementioned global supply chain issues. We expect to see continued improvement in revenues from the IAM business segment in the fourth quarter of the year, but we temper expectations due to the ongoing global shortage of semiconductors, and recent spike in LPG and CNG prices which could continue to impact the IAM business.
CUMMINS WESTPORT INC.
Revenue for the three months ended September 30, 2021 for the Cummins Westport Inc. (“CWI”) joint venture, was $83.3 million compared to $84.4 million year-over-year. Unit sales for the three months ended September 30, 2021, were 1,764 compared to 1,912 year-over-year. The decrease in unit sales is a result of delays in OEM orders due to supply chain issues in the quarter. Parts revenue for the three months ended September 30, 2021 was $29.4 million compared to $25.1 million year-over-year. Currently, we are working with Cummins to wrap up the final terms for the conclusion of the joint-venture. We expect engines with our HPDI technology to have an important role in the North American market, as they have had in Europe.
Revenue for the nine months ended September 30, 2021 was $255.8 million compared to $227.5 million for the same prior year period. Unit sales for the nine months ended September 30, 2021 were 5,642 compared to 4,777 for the same prior year period. Unit sales were higher in the current year reflecting the impact of OEM factory shutdowns in April and May 2020 in response to the COVID-19 pandemic. Parts revenue for nine months ended September 30, 2021 was $83.3 million compared to $79.2 million for same prior year period.
|
CUMMINS WESTPORT HIGHLIGHTS |
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|
Over / (Under) % |
Over / (Under) % |
|||||||||||||||||
|
($ in millions, except unit amounts) |
3Q21 |
3Q20 |
9M’21 |
9M’20 |
||||||||||||||
|
Units |
1,764 |
1,912 |
(8 |
) |
% |
5,642 |
4,777 |
18 |
% |
|||||||||
|
Revenue |
$ |
83.3 |
$ |
84.4 |
(1 |
) |
% |
$ |
255.8 |
$ |
227.5 |
12 |
||||||
|
Product revenue |
53.9 |
59.3 |
(9 |
) |
% |
172.5 |
148.3 |
16 |
% |
|||||||||
|
Parts revenue |
29.4 |
25.1 |
17 |
% |
83.3 |
79.2 |
5 |
% |
||||||||||
|
Gross Margin |
16.5 |
19.0 |
(13 |
) |
% |
59.9 |
58.8 |
2 |
% |
|||||||||
|
Gross Margin % |
20 |
% |
22 |
% |
— |
23 |
% |
26 |
% |
— |
||||||||
|
Operating Expenses |
6.3 |
6.4 |
(2 |
) |
% |
14.7 |
22.2 |
(34 |
) |
% |
||||||||
|
Operating Income |
$ |
10.3 |
$ |
12.5 |
(18 |
) |
% |
$ |
45.2 |
$ |
36.6 |
23 |
% |
|||||
|
WFS 50% Interest |
3.8 |
4.9 |
(21 |
) |
% |
18.2 |
14.4 |
26 |
% |
|||||||||
FINANCIAL STATEMENTS & MANAGEMENT’S DISCUSSION AND ANALYSIS
To view WFS financials for the second quarter ended September 30, 2021, please visit https://investors.wfsinc.com/financials/
LIVE CONFERENCE CALL & WEBCAST
WFS has scheduled a conference call for Tuesday, November 9, 2021, at 7:00 am Pacific Time (10:00 am Eastern Time) to discuss these results. To access the conference call by telephone, please dial 1-800-319-4610 (Canada & USA toll-free) or 604-638-5340. The live webcast of the conference call can be accessed through the WFS website at https://investors.wfsinc.com/
REPLAY CONFERENCE CALL & WEBCAST
To access the conference call replay, please dial 1-800-319-6413 (Canada & USA toll-free) or +1-604-638-9010 using…
Read More:Westport Fuel Systems Reports Third Quarter 2021 Financial Results
2021-11-08 22:00:00
