At a Glance:
- Exro generated revenue of $2,443,292 for the three months ended
June 30, 2023 and $2,768,061 for the six months ended June 30, 2023
- On May 15th Exro announced the
signing of a definitive commercialization agreement with strategic
partner, and global tier-1 automotive supplier, Linamar
Corporation
- On May 23rd Exro announced
closing of a common share bought deal financing for aggregate gross
proceeds to the Company of $34,931,250
- On June 30th Exro announced
the election of three new Directors, Aleksandra Miziolek, Anita Ganti, and Frank
Simpkins and the appointment of Rod
Copes to Chairman of the Board.
CALGARY,
AB, Aug. 10, 2023 /CNW/ - Exro Technologies
Inc. (TSX: EXRO) (OTCQB: EXROF) (the "Company" or
"Exro"), a leading clean technology company which has
developed a new generation power control electronics that expand
the capabilities of electric motors and batteries, announced today
its financial results for the quarter ended June 30, 2023.
"The second quarter of 2023 demonstrated continued progress
towards commercialization of our next generation technologies for
electric vehicles and stationary energy storage", said Exro CEO
Sue Ozdemir. "We finished the
quarter in a strong financial position, significantly expanded the
expertise of our Board of Directors, and are in final preparations
to start our production before the end of Q3. We have customers
proceeding towards additional purchase orders and are digging in
with our new leading global automaker partner on our power train
innovation project – evidence that we are capitalizing on the
efforts we have put in over the last three years."
2023 score card check-in
In January, Exro kicked-off its launch year with a Q1 Letter to
Shareholders which outlined its strategic objectives for 2023
(LINK). The purpose in setting these objectives was to continue
transparency to investors while aligning with what management
believes are demonstrable value drivers for the Company's
shareholders. A status update on these objectives is included
below:
- Signing additional Coil Driver™ strategic
partners that amplify its market presence. In Q1 2023, Exro
announced signing a partnership with a global European-based tier-1
OEM automotive supplier. Currently under a non-disclosure agreement
("NDA"), Exro and partner remain on track for partner motor-Exro
Coil Driver™ inverter integration and testing in Q3 2023. Following
successful testing it is anticipated the identity of the 25,000+
employee partner will be announced along with commercialization
plans. In Q2 2023, Exro announced signing the world's third largest
motor manufacturer, Wolong Electric Group, as a strategic partner.
The companies are collaborating on various motor-inverter
combinations for integration and testing in Q4 2023 across a
variety of low voltage and high voltage applications. Additionally,
in early Q3 2023, Exro announced an innovation agreement with a
Major Global Automaker, to mutually explore powertrain innovations
in the Company's electric passenger vehicles utilizing Exro's
advanced power electronics technology. The Parties anticipate
completion of the proof-of-concept Coil Driver™ plus optimized
motor design system by the end of Q4 2023 that demonstrate improved
continuous torque and performance, followed by delivery of
functional prototypes to the OEM by the end of Q4 2024.
- Delivery of low-voltage and high-voltage
design-for-manufacture (DFM) samples for customer validation.
On March 25, 2023, Exro delivered an
initial batch of low-voltage DFM samples to Italian OEM supplier
and partner HB4. These samples have been integrated into vehicles
(a truck and passenger car) and showcased in recent European trade
shows. Exro has recently shipped an initial batch of DFM
high-voltage samples to an NDA customer in Brazil and is readying for DFM sample
integrations with both SEA Electric and Vicinity Motors in
September 2023.
- Delivery of 48V hybrid-diesel samples to our European
off-highway NDA-partner in Q1. Of note, this project
includes two NDA's under one umbrella partnership – one is a large
European OEM which supplies vehicles for off-highway applications,
the second is a large European-based motor supplier. As previously
announced, NDA partner timing bumped sample delivery into Q2 2023.
Integration of the partner motor-Exro inverter solution for the
OEM's hybrid-diesel platform was completed in Q2 with on-site
commissioning of the combined solution scheduled in Europe in late August. On successful customer
validation, the development agreement is anticipated to transition
to a series production agreement for 8,000-10,000+ Coil Driver™
units annually.
- Signing additional multi-year commercial agreements that
build our Coil Driver™ order backlog. With the
continued roll out of low-voltage and high-voltage DFM samples
through Q3 2023, Exro has been engaged in commercial agreement
discussions with numerous parties. Following customer vehicle
integration and in-field validation, it is anticipated discussions
will translate into supply agreements in the near term and into
2024.
- Work through phase-2 validation and towards
commercialization agreement with Linamar. In May, Exro
announced the signing of a definitive commercialization agreement
following the successful validation by Linamar of the parties'
co-developed integrated e-Axle utilizing Exro's coil Driver™
traction inverter. The agreement is set for an initial five-year
term, with parties committing to milestones and commercial volume
targets. In accordance with the agreement, by early 2024 the
parties intend to have completed a demonstration vehicle containing
the e-Axle product to be utilized as a joint marketing asset for
commercial vehicle customers. Series production of the e-Axle is
anticipated to begin in late 2024 to support customer
deliveries.
- Growing contract services for software engineering and
vehicle integration through Exro Vehicle Systems. In Q2,
Exro announced a contract award by its Exro Vehicle Systems valued
at US$2.35 million. The contract is
for design services, including a custom battery pack solution, for
a light-duty on-road electric vehicle for a leading automotive
Tier-1 supplier. Delivery is on track for scheduled completion in
Q4 2023.
- Achieve Cell Driver™ UL Certification in Q2.
As previously announced, Exro's Cell Driver™ Energy Storage System
has successfully completed two of the three major certification
phases. The system is on track to complete UL certification in Q3
2023, pushed back slightly due to scheduling at UL's certification
laboratories. UL certification is required prior to connecting to
the grid in North America.
- Signing US Cell Driver™ distribution and
installer partnerships and build order backlog. In Q1
2023, Exro announced a distribution partnership with Greentech
Renewables Southwest, the largest distributor of renewable energy
products in the southwestern United
States with more than 80 sales centers. In Q2 2023, Exro
named Re:Build Manufacturing as exclusive manufacturing partner for
the Company's Cell Driver cabinets along with four new channel
sales partnerships: Photovoltaics California, ProSolar, Shaw Solar,
and High Point Electric which provide access to customer networks
in California, Colorado, Florida, the Caribbean, and regions within Canada. Channel partners are being trained on
Cell Driver™ and are currently marketing and quoting the
technology with solar energy, electric vehicle charging
infrastructure and energy management projects. Following UL
certification, Exro anticipates technology deployment with initial
customer deliveries and in-field pilots to demonstrate and collect
"real-world" data.
- Achieve first deliveries and revenues for Coil
Driver™ and Cell Driver™ products in Q3.
Exro remains on schedule to start production of its Coil
Driver™ and Cell Driver™ products in Q3 2023.
Low-voltage Coil Driver™ products are on schedule for
deliveries in September which will be followed by the start of
high-voltage products in Q4 2023. Following UL Certification for
Exro's Cell Driver™ Energy Storage System, the Company
is on track to start production in Q3 2023 with initial customer
deliveries and in-field pilots.
- Continue to evaluate market conditions for a Nasdaq up
list. The Company remains committed to an eventual up list
and will do so when it deems an opportune time and in the best
interest of shareholders.
Second quarter and subsequent
operating highlights
On June 30, 2023, Exro announced
the election of three new Directors: Aleksandra Miziolek, Anita Ganti, and Frank
Simpkins. On June 7, 2023 the
Company announced that Rod Copes had
moved from Interim Chairman to Chairman of the Board.
On May 23, 2023, Exro announced
the closing of its bought deal financing, including the exercise in
full of the Underwriters' (as defined below) over-allotment option,
for a total of 15,525,000 common shares (the "Common Shares") sold
at a price of $2.25 per Common Share
for aggregate gross proceeds to the Company of $34,931,250 (the "Offering").
On May 15, 2023, Exro announced
the signing of a definitive commercialization agreement with
strategic partner, and global tier-1 automotive supplier, Linamar
Corporation. The agreement follows successful testing and
validation by Linamar of the Parties' co-developed integrated
electric axle ("e-Axle") utilizing Exro's Coil Driver™ traction
inverter and signals a commitment by the Parties to commercialize
the product for multi-year series production. In Q4 2022, Exro
supplied 800V Coil Driver™ inverter samples designed for
integration into Linamar's e-Axle program. Following successful
continued testing of the samples by Linamar through the first half
of 2023, the Parties have progressed to a definitive agreement
intended to commercialize the co-developed e-Axle into series
production. The agreement is set for an initial five-year term with
the Parties committing to milestones and commercial volume targets.
In accordance with the agreement, by Q4 2023, the Parties intend to
build a demonstration vehicle containing the e-Axle product to be
utilized as a joint marketing asset for commercial vehicle
customers.
On May 8, 2023, the Company
announced Re:Build Manufacturing as Exro's exclusive manufacturing
partner for its Cell Driver™. The partnership with Re:Build
Manufacturing provides Exro the ability to quickly scale to capture
the significant opportunity in energy storage while removing all
future capital expenditure and inventory working capital
requirements associated with Cell Driver™ manufacturing from Exro's
balance sheet. The Company also announced new channel sales
partnerships with Photovoltaics California, ProSolar, Shaw Solar,
and High Point Electric, renewable energy and energy management
integrators that cover customer networks in California, Colorado, Florida, the Caribbean, and regions within Canada.
On July 13, 2023, Exro announced
an innovation agreement with a leading Major Global Automaker, to
mutually explore powertrain innovations in the Company's electric
passenger vehicles utilizing Exro's advanced power electronics
technology. The purpose of the collaboration is to determine the
performance of Exro's Coil Driver™ product for improving the
continuous power and torque output of the powertrain in the OEM's
vehicles. Under the terms of the agreement, the Parties will work
together to design a proof-of-concept Coil Driver™ plus motor
system that would specifically fit into a defined electric machine
housing. Under the agreement, the Parties anticipate completion of
the proof-of-concept Coil Driver™ plus optimized motor design
system by the end of Q4 2023, followed by delivery of functional
prototypes to the OEM by the end of Q4 2024. The prototypes are
then expected to enter a period of testing, including performance,
durability, and reliability while determining next steps.
First quarter 2023 financial
highlights
For the three months ended June 30, 2023
- Revenue of $2,443,292
(2022 – $142,078)
- Comprehensive loss of $12,649,383 (2022 – $8,739,338)
- Selling, general and administration expense increased by
$38,348 to $3,208,175 from $3,169,827
- Payroll and consulting fees increased by $1,471,670 to $4,645,443 from $3,173,773
- Research and development increased by $1,208,913 to $3,212,787 from $2,003,874
For the six months ended June 30, 2023
- Revenue of $2,768,061
(2022 – $246,338)
- Comprehensive loss of $20,761,344 (2022 – $18,911,341)
- Selling, general and administration expense decreased by
$1,173,540 to $4,650,285 from $5,823,825
- Payroll and consulting fees increased by $2,223,906 to $8,294,939 from $6,071,033
- Research and development increased by $835,339 to $5,122,451 from $4,287,112
The Company saw revenue generated of $2,443,292 for the three months ended
June 30, 2023 and $2,768,061 for the six months ended June 30, 2023, through the execution of
engineering services agreements.
Exro saw an overall increase in operating costs for the six
months ended June 30, 2023, which was
driven largely by higher payroll and research and development costs
compared to the same period in 2022, in addition to higher non-cash
costs related to depreciation and share-based payments, offset by
lower selling, general and administration costs. The Company
continues to invest in talent to gear up for the start of
production in 2023.
Liquidity and capital
resources
As of June 30, 2023, the Company
had cash of $34,966,644 and amounts
receivable of $338,302. The Company
had accounts payable and accrued liabilities of $3,544,077.
Results of operations and selected financial data
For the six
months
ended
|
Revenue
|
Comprehensive
loss
|
Basic and
diluted loss per
common share
|
Weighted average
number of common
shares
|
June 30,
2023
|
$2,768,061
|
$(20,761,344)
|
$(0.14)
|
154,277,348
|
June 30,
2022
|
$246,338
|
$(18,911,341)
|
$(0.14)
|
132,622,843
|
Outstanding share data
As of August 10, 2023, there were 168,656,309 Common Shares
issued and outstanding, and other securities convertible into
Common Shares as summarized in the following table:
|
Number outstanding
as of
|
|
August 10,
2023
|
June 30,
2023
|
|
Common Shares issued
and outstanding
|
168,656,309
|
168,627,709
|
|
Options
|
11,435,846
|
10,644,626
|
|
Warrants
|
16,500,983
|
16,522,983
|
|
RSU's
|
212,262
|
212,262
|
|
PSU's
|
754,375
|
754,375
|
|
Additional information
The condensed consolidated interim financial statements and
Management's Discussion and Analysis for the quarter ended
June 30, 2023, released August 10, 2023, can be viewed at
www.exro.com/investors or on SEDAR+ under Exro Technologies
Inc. at www.sedarplus.ca.
Unless otherwise noted, all figures are in Canadian currency,
Cdn.
ABOUT EXRO TECHNOLOGIES
INC.
Exro Technologies Inc. is a leading clean technology company
that has developed new generation power control electronics that
change how the world optimizes energy by expanding the capabilities
of electric motors and batteries. The company's innovative
technologies serve to bridge the performance-cost gap in e-mobility
(Coil Driver™) and stationary energy storage (Cell
Driver™), and act to accelerate adoption towards a
circular electrified economy by delivering more with less – minimum
energy for maximum results.
For more information visit our website at www.exro.com.
To view our Corporate Presentation visit us at
www.exro.com/investors
Visit us on social media @exrotech.
On behalf of the board of directors
Sue Ozdemir, Chief Executive
Officer
CAUTIONARY STATEMENT REGARDING FORWARD LOOKING
STATEMENTS
This news release contains forward-looking statements and
forward-looking information (together, "forward-looking
statements") within the meaning of applicable securities laws. All
statements, other than statements of historical facts, are
forward-looking statements. Generally, forward-looking statements
can be identified by the use of terminology such as "plans",
"expects", "estimates", "intends", "anticipates", "believes" or
variations of such words, or statements that certain actions,
events or results "may", "could", "would", "might", "will be
taken", "occur" or "be achieved". Forward looking statements
involve risks, uncertainties and other factors disclosed under the
heading "Risk Factors" and elsewhere in the Company's filings with
Canadian securities regulators, that could cause actual results,
performance, prospects and opportunities to differ materially from
those expressed or implied by such forward-looking statements.
Although the Company believes that the assumptions and factors used
in preparing these forward-looking statements are reasonable based
upon the information currently available to management as of the
date hereof, actual results and developments may differ materially
from those contemplated by these statements. Readers are therefore
cautioned not to place undue reliance on these statements, which
only apply as of the date of this news release, and no assurance
can be given that such events will occur in the disclosed times
frames or at all. Except where required by applicable law, the
Company disclaims any intention or obligation to update or revise
any forward-looking statement, whether as a result of new
information, future events or otherwise.
This information is qualified in its entirety by cautionary
statements and risk factor disclosure contained in filings made by
the Company with the Canadian securities regulators, including the
Company's annual information form for the financial year ended
December 31, 2022, and financial
statements and related MD&A for the financial year ended
December 31, 2022, filed with the
securities regulatory authorities in certain provinces of
Canada and available at
www.sedarplus.ca. Should one or more of these risks or
uncertainties materialize, or should assumptions underlying the
forward-looking information prove incorrect, actual results may
vary materially from those described herein as intended, planned,
anticipated, believed, estimated or expected. Although the Company
has attempted to identify important risks, uncertainties and
factors which could cause actual results to differ materially,
there may be others that cause results not to be as anticipated,
estimated or intended. The Company does not intend, and does not
assume any obligation, to update this forward-looking information
except as otherwise required by applicable law.
Neither the Toronto Stock Exchange nor the Investment Industry
Regulatory Organization of Canada
accepts responsibility for the adequacy or accuracy of this press
release.
View original content to download
multimedia:https://www.prnewswire.com/news-releases/exro-technologies-announces-second-quarter-2023-financial-results-301898425.html
SOURCE Exro Technologies Inc.