On Monday, GreenPower Motor Company Inc shares (NASDAQ: GP) maintained a Neutral rating by a BTIG analyst following the company's report of its fiscal fourth quarter 2024 financial performance. The electric vehicle (EV) manufacturer disclosed revenue of approximately $5.1 million, falling short of the consensus estimate of around $8.7 million.
The company also reported an adjusted EBITDA loss of about $4.1 million, which was larger than the anticipated loss of $2.8 million. Despite these figures, the company's stock remained relatively unchanged by mid-morning.
GreenPower's stock has experienced a significant decline, dropping roughly 67% this year, mirroring the downtrend seen across the EV sector. Industry challenges include a weakening demand environment and slower-than-expected rollout of government incentives. However, GreenPower has managed to maintain positive gross margins, distinguishing itself from many of its peers.
In terms of production, GreenPower ended fiscal year 2024 with approximately 222 vehicle deliveries. This is a decrease from the 299 vehicles delivered in fiscal year 2023 but an increase from the 93 vehicles delivered in fiscal year 2022.
The breakdown for FY2024 included about 43 e-bus and transit vehicles, which encompassed only 2 transit buses, and 179 EV Stars. Notably, e-bus and transit deliveries saw a 291% increase, while EV Star deliveries fell by 38%, attributed to a halt in orders from a core customer, Workhorse.
Looking ahead to fiscal year 2025, GreenPower has received a new order for approximately 88 e-bus units from the state of West Virginia. This order expands the company's existing commitments from the state to over 100 vehicles.
Currently, 37 Type D BEAST buses from this new order are already being produced, with a significant portion expected to be delivered by the end of the calendar year. The company aims to reach a production rate of 50 to 60 e-buses per quarter by the end of FY2025.
The analyst concluded by noting the anticipation of an increase in e-bus production due to the new West Virginia production facility becoming operational. However, the timing of deliveries is subject to change and will largely depend on the receipt of government incentives.
It was mentioned that last year, the company did not generate any revenue from Environmental Protection Agency (EPA) incentives, but expectations are set for this to change.
In other recent news, GreenPower Motor Company Inc. has been making significant strides in its operations. The company has set the price for its $2.3 million public offering, which includes 1.5 million common shares and equal warrants, each bundle priced at $1.55. The net proceeds from this offering will be directed towards manufacturing its all-electric vehicles, including the BEAST school buses and EV Star commercial vehicles.
In addition to the public offering, GreenPower has announced the appointment of Paul Start as its Vice President of Sales for the School Bus Group. With over three decades of experience in the school bus sector, Start's role will focus on expanding sales and managing dealer relationships for GreenPower's lineup of electric school buses.
The company also plans to deliver 88 all-electric school buses to several school districts in West Virginia during its fiscal year 2025. This move is part of a broader initiative to deploy environmentally friendly transportation solutions in the state.
The buses are being produced at GreenPower's South Charleston facility and are part of the second round of the Environmental Protection Agency's (EPA) Clean School Bus Program.
On the analyst front, Roth/MKM adjusted its price target for GreenPower, dropping it to $3 from the previous $7 while retaining a Buy rating on the stock. Despite this adjustment, the firm noted that GreenPower has experienced improved growth visibility, attributed to an increase in orders and deliveries of electric vehicle (EV) school buses.
These recent developments highlight GreenPower's ongoing initiatives and strategic position in the EV market.
InvestingPro Insights
GreenPower Motor Company Inc (NASDAQ: GP) is navigating a challenging financial landscape, underscored by recent data from InvestingPro. With a market capitalization of $27.29 million and a negative P/E ratio of -1.4, reflecting investor concerns about profitability, the company's financial health requires careful consideration.
Gross profit margins have remained weak at 13.64%, and the company has been operating at a loss, with an operating income margin of -42.78%. This data aligns with the concerns mentioned by the BTIG analyst regarding the company's fiscal fourth quarter performance.
InvestingPro Tips suggest that GreenPower operates with a significant debt burden and may face difficulties in making interest payments, which is critical for investors to consider given the company's reported revenue shortfall. Moreover, while analysts anticipate sales growth in the current year, they do not expect the company to be profitable within this timeframe.
On a positive note, GreenPower's liquid assets do exceed its short-term obligations, providing some financial cushion. The stock is also trading near its 52-week low, which could signal a potential entry point for investors believing in the company's long-term prospects.
Prospective investors and current shareholders looking to deepen their analysis may find additional InvestingPro Tips by visiting the dedicated page for GreenPower Motor Company Inc. For those interested in an InvestingPro subscription, use the coupon code PRONEWS24 to get up to 10% off a yearly Pro and a yearly or biyearly Pro+ subscription. With 11 more tips available on InvestingPro, users can gain a more comprehensive understanding of the investment landscape surrounding GreenPower.
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