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Westport Fuel Systems Reports Fourth Quarter and Full Year 2019 Financial Results - Strong 2019 Financial Performance
Monday, March 23, 2020Company Profile | Careers | Follow Company
Vancouver, BC, March 23, 2020--(T-Net)--Westport Fuel Systems Inc.(TSX:WPRT / Nasdaq:WPRT) reported financial results for the fourth quarter and year ended December 31, 2019 and provided an update on operations.
All figures are in U.S. dollars unless otherwise stated.
Key Accomplishments
2019 was a pivotal year for Westport Fuel Systems. We continued our trend of year-over-year financial improvements to both our top- and bottom-lines. Importantly, our core business is thriving and Westport HPDI 2.0™ is demonstrating scalability, in both economics and operations,"
"Strong year-over-year revenue growth and continued cost control underpins our ongoing HPDI commercialization efforts. Each of our business units delivered improved operating results and we remain confident in our outlook as the demand for our technology continues to strengthen in key markets like Europe, China, and India. Our focus on delivering on our commitments to customers and enhancing our operating performance is unwavering" said David M. Johnson, Chief Executive Officer of Westport Fuel Systems.
Financial Highlights
2020 Key Priorities
Our key strategic priorities for 2020 are:
2020 Outlook
We are closely tracking and monitoring the impact of COVID-19 on our business, including our operations in China and Italy. Given the high degree of uncertainty in markets around the world and the recent drop in oil prices, we expect that the headwinds which are developing now may persist for much of the rest of the year. We are working to continue the growth of the business for long term profitability and to ensure we have the liquidity to invest and operate our businesses and meet our financial obligations.
Q4 2019 & Full Year 2019 Financial Highlights
CONTINUING OPERATIONS
($ in millions, except per share amounts) | 3 Months Ended Dec 31 |
Change Better / (Worse) |
12 Months Ended Dec 31 |
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2019 | 2018 | 2019 | 2018 | ||
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Revenues* | $74.3 | $60.5 | 23% | $305.3 | $270.3 |
Gross Margin | 13.8 | 12.3 | 13% | 68.3 | 64.2 |
Gross Margin % | 19% | 20% | — | 22% | 24% |
Operating Expenses | 19.3 | 27.3 | 29% | 89.6 | 116.9 |
Income from Unconsolidated Joint Ventures[3] | 6.8 | 5.8 | N/A | 26.7 | 22.7 |
Net Loss from Continuing Operations | 0.6 | (10.4) | 106% | 0.2 | (40.8) |
Net Loss Per Share from Continuing Operations | — | (0.08) | 100% | — | (0.31) |
EBITDA[1] | 5.0 | (5.3) | 194% | 24.9 | (13.5) |
Adjusted EBITDA[1] | 3.6 | 0.2 | 1,700% | 28.4 | 9.6 |
Cummins Westport Inc. Highlights
CUMMINS WESTPORT HIGHLIGHTS
($ in millions, except unit amounts) | 3 Months Ended Dec 31 |
Over / (Under) |
12 Months Ended Dec 31 |
Change Better / (Worse) |
||
2019 | 2018 | 2019 | 2018 | |||
Units | 2,407 | 2,362 | 2% | 7,883 | 7,393 | 7% |
Revenue | $102.5 | $94.1 | 9% | $361.8 | $319.4 | 13% |
Gross Margin | 28.3 | 21.0 | 35% | 104.1 | 91 | 14% |
Gross Margin Percentage | 28% | 22% | — | 29% | 28% | — |
Operating Expenses | $ 8.2 | $ 9.2 | 11% | $ 35.6 | $ 35.5 | — |
Segment Operating Income | 20.1 | 11.7 | 72% | 68.4 | 55.4 | 23% |
Westport Fuel Systems 50% Interest | 6.7 | 5.7 | 18% | 26.6 | 22.7 | 17% |
GAAP and NON-GAAP Financial Measures
Management reviews the operational progress of its business units and investment programs over successive periods through the analysis of net income, EBITDA and Adjusted EBITDA. Westport Fuel Systems defines EBITDA as net income or loss from continuing operations before income taxes adjusted for interest expense (net), depreciation and amortization. Westport Fuel Systems defines Adjusted EBITDA as EBITDA from continuing operations excluding expenses for stock-based compensation, unrealized foreign exchange gains or losses, and non-cash and other adjustments. Management uses Adjusted EBITDA as a long-term indicator of operational performance since it ties closely to the business units' ability to generate sustained cash flow. Adjusted EBITDA includes the Westport Fuel Systems's share of income from joint ventures.
The term Adjusted EBITDA is not defined under U.S. generally accepted accounting principles ("U.S. GAAP") and is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP. Adjusted EBITDA has limitations as an analytical tool, and when assessing the Westport Fuel Systems operating performance, investors should not consider Adjusted EBITDA in isolation, or as a substitute for net loss or other consolidated statement of operations data prepared in accordance with U.S. GAAP. Among other things, Adjusted EBITDA does not reflect Westport Fuel Systems actual cash expenditures. Other companies may calculate similar measures differently than Westport Fuel Systems, limiting their usefulness as comparative tools. Westport Fuel Systems compensates for these limitations by relying primarily on its U.S. GAAP results and using Adjusted EBITDA as supplemental information.
GAAP & NON-GAAP FINANCIAL MEASURES FROM CONTINUING OPERATIONS
($ in millions) 3 months ended |
31-Dec-18 |
31-Mar-19 | 30-Jun-19 |
30-Sep-19 |
31-Dec-19 |
Net Loss from Continuing Operations | $(10.4) | $(3.0) | $(2.3) | $4.9 | $0.6 |
Interest Tax Expense | (1.5) | 1.1 | 0.9 | 0.8 | (0.9) |
Interest Expense, Net | 2.6 | 1.8 | 1.4 | 1.8 | 1.5 |
Depreciation and Amortization | 4.0 | 4.3 | 4.0 | 4.2 | 5.0 |
EBITDA | (5.3) | 4.2 | 4.0 | 11.7 | 5.0 |
Stock Based Compensation | 0.7 | 0.4 | 0.3 | 0.3 | 0.5 |
Unrealized Foreign Exchange (Gain) Loss | 1.6 | 0.1 | (0.7) | 0.7 | (2.6) |
Asset Impairment | 0.6 | — | — | — | 0.7 |
Restructuring, Termination and other Exit Costs | — | 0.8 | — | — | — |
Legal costs associated with SEC investigation | 3.1 | 1.8 | 4.5 | — | — |
Other | (0.5) | — | — | (3.3) | — |
Adjusted EBITDA | $0.2 | $7.3 | $8.1 | $9.4 | $3.6 |
Financial Statements & Management's Discussion & Analysis
To view Westport Fuel Systems full financials for the fourth quarter and year ended December 31, 2019, please visitwww.wfsinc.com/investors/financials.
About Westport Fuel Systems
At Westport Fuel Systems, we are driving innovation to power a cleaner tomorrow. We are a leading supplier of advanced fuel delivery components and systems for clean, low-carbon fuels such as natural gas, renewable natural gas, propane, and hydrogen to the global automotive industry. Our technology delivers the performance and fuel efficiency required by transportation applications and the environmental benefits that address climate change and urban air quality challenges. Headquartered in Vancouver, Canada, with operations in Europe, Asia, North America and South America, we serve our customers in more than 70 countries with leading global transportation brands. At Westport Fuel Systems, we think ahead. For more information, visit www.wfsinc.com.
Cautionary Note Regarding Forward Looking Statements
This press release contains forward-looking statements, including statements regarding revenue and cash usage expectations, future strategic initiatives and future growth, future of our development programs (including those relating to HPDI), the impact of COVID-19 and the recent drop in oil prices on our business, the demand for our products, the future success of our business and technology strategies, intentions of partners and potential customers, the performance and competitiveness of Westport Fuel Systems' products and expansion of product coverage, future market opportunities, speed of adoption of natural gas for transportation and terms and timing of future agreements as well as Westport Fuel Systems management's response to any of the aforementioned factors. These statements are neither promises nor guarantees, but involve known and unknown risks and uncertainties and are based on both the views of management and assumptions that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activities, performance or achievements expressed in or implied by these forward looking statements.
These risks, uncertainties and assumptions include those related to our revenue growth, operating results, industry and products, the general economy, conditions of and access to the capital and debt markets, solvency, governmental policies and regulation, technology innovations, fluctuations in foreign exchange rates, operating expenses, continued reduction in expenses, ability to successfully commercialize new products, the performance of our joint ventures, the availability and price of natural gas, global government stimulus packages and new environmental regulations, the acceptance of and shift to natural gas vehicles, the relaxation or waiver of fuel emission standards, the inability of fleets to access capital or government funding to purchase natural gas vehicles, the development of competing technologies, our ability to adequately develop and deploy our technology, the actions and determinations of our joint venture and development partners, the effects and duration of COVID-19 as well as other risk factors and assumptions that may affect our actual results, performance or achievements or financial position discussed in our most recent Annual Information Form and other filings with securities regulators.
Readers should not place undue reliance on any such forward-looking statements, which speak only as of the date they were made. We disclaim any obligation to publicly update or revise such statements to reflect any change in our expectations or in events, conditions or circumstances on which any such statements may be based, or that may affect the likelihood that actual results will differ from those set forth in these forward looking statements except as required by National Instrument 51-102. The contents of any website, RSS feed or twitter account referenced in this press release are not incorporated by reference herein.
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