Canoo Inc. Announces Third Quarter 2021 Results
Canoo Inc. (Nasdaq: GOEV) reported its Q3 2021 financial results, noting an expanded manufacturing partnership with Oklahoma and new facilities in Arkansas. The company targets $400 million in non-dilutive financial incentives and anticipates $100 million in vehicle orders from local entities. Despite a net loss of $80.9 million for Q3, cash and equivalents totaled $414.9 million. The workforce increased by 22% to 800. Looking ahead, Canoo expects operating expenses between $95 million and $115 million, along with capital expenditures of $60 million to $80 million.
- Expansion of facilities to Arkansas and Oklahoma, promising $400 million in financial incentives.
- Workforce grew by 22% to approximately 800 employees.
- Anticipated vehicle orders of $100 million from partnerships with states and universities.
- GAAP net loss increased to $80.9 million in Q3 2021 from $23.4 million in Q3 2020.
- Operating cash used totaled $180.6 million for 2021, up from $65.1 million in 2020.
- Adjusted EBITDA was $(85.8) million, worsening from $(20.1) million year-over-year.
JUSTIN, Texas, Nov. 15, 2021 /PRNewswire/ -- Canoo Inc. (Nasdaq: GOEV) ("Canoo"), a company developing breakthrough electric vehicles ("EV") with a proprietary and highly versatile EV platform for personal and business use, today announced its financial results for the third quarter of 2021.
"Our discipline continues to be Big News or No News. Therefore, we will accelerate our advanced manufacturing production in the U.S. to begin before Q4 2022," stated Tony Aquila, Investor, Chairman & CEO at Canoo Inc. "In June we announced Pryor, Oklahoma as the location for our owned manufacturing facility. We have expanded this partnership to include Arkansas and additional locations in Oklahoma. We will now focus on completing the definitive agreements with each state, which will include approximately
Recent Updates:
- Selected Bentonville, Arkansas as location for Corporate Headquarters and Advanced Industrialization Facility
- Fayetteville, Arkansas for R&D Center
- Expanded Our Oklahoma Partnership to Include R&D, Software Development, Customer Support & Finance Centers
- Approximately
$100 million of Anticipated Additional Non-Dilutive State and Local Financial Incentives - Accelerated Our Timeline for Production in the U.S.
- Selected Panasonic as battery supply partner
Third Quarter Business Highlights:
- Engineering design is complete and sourced for LV Gamma builds
- Grew workforce by
22% sequentially to approximately 800 at close of Q3
Third Quarter Financial Highlights:
- Cash and cash equivalents of
$414.9 million as of September 30, 2021. - GAAP net loss and comprehensive loss of
$80.9 million and$208.7 million for the three and nine months ended September 30, 2021, compared to a GAAP net loss and comprehensive loss of$23.4 million and$77.5 million for the three and nine months ended September 30, 2020, respectively. The GAAP net loss and comprehensive loss for the three and nine months ended September 30, 2021, included a gain of$25.8 million and$101.2 million on the fair value change of the contingent earnout shares liability, respectively. - Adjusted EBITDA of
$(85.8) million and$(212.3) million for the three and nine months ended September 30, 2021, compared to$(20.1) million and$(60.8) million for the three and nine months ended September 30, 2020, respectively. - Net cash used in operating activities totaled
$180.6 million for the nine months ended September 30, 2021, compared to$65.1 million for the nine months ended September 30, 2020. - Net cash used in investing activities was
$100.1 million during the nine months ended September 30, 2021, compared to$1.2 million during the nine months ended September 30, 2020.
Fourth Quarter 2021 Business Outlook
Based upon our current projections, Canoo expects:
- Operating Expenses (excluding stock-based compensation and depreciation) of:
$95 million to$115 million - Capital Expenditures of:
$60 million to$80 million
Conference Call Information
Canoo will host a conference call to discuss the results today, November 15, 2021, at 5:00 PM ET.
To listen to the conference call via telephone dial (866) 682-6100 (U.S.) and (862) 298-0702 (international callers/U.S. toll) and enter the conference ID number 13724844. To listen to the webcast, please click here. A telephone replay will be available until November 29, 2021, at (877) 660-6853 (U.S.) and (201) 612-7415 (international callers/U.S. toll), with Conference ID number 13724844. To listen to the webcast replay, please click here.
About Canoo
Canoo's mission is to bring EVs to Everyone. The company has developed breakthrough electric vehicles that are reinventing the automotive landscape with bold innovations in design, pioneering technologies, and a unique business model that spans the full lifecycle of the vehicle. Distinguished by its experienced team from leading technology and automotive companies – Canoo has designed a modular electric platform purpose-built to deliver maximum vehicle interior space that is customizable across all owners in the vehicle lifecycle to support a wide range of vehicle applications for consumers and businesses.
Canoo has offices in California and Texas. For more information, please visit www.canoo.com. For Canoo press materials, including photos, please visit press.canoo.com. For investors, please visit investors.canoo.com.
Non-GAAP Financial Measures
EBITDA and Adjusted EBITDA
"EBITDA" is defined as net loss before interest expense, income tax expense or benefit, and depreciation and amortization. "Adjusted EBITDA" is defined as EBITDA adjusted for stock-based compensation, restructuring charges, asset impairments, and other costs associated with exit and disposal activities, acquisition and related costs, changes to the fair value of contingent earnout shares liability, and any other one-time non-recurring transaction amounts impacting the statement of operations during the year. Adjusted EBITDA is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP. We believe Adjusted EBITDA, when combined with net loss, and EBITDA, is beneficial to an investor's complete understanding of our operating performance. We believe that the use of EBITDA and Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors. However, you should be aware that when evaluating EBITDA and Adjusted EBITDA we may incur future expenses similar to those excluded when calculating these measures. In addition, our presentation of these measures should not be construed as an inference that our future results will be unaffected by unusual or non-recurring items. Our computation of EBITDA and Adjusted EBITDA may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate EBITDA and Adjusted EBITDA in the same fashion.
Because of these limitations, EBITDA and Adjusted EBITDA should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We manage our business utilizing EBITDA and Adjusted EBITDA as supplemental performance measures.
Third Quarter 2021 Financial Results
CANOO INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except par values) UNAUDITED | ||||||
September 30, | December 31, | |||||
2021 | 2020 | |||||
Assets | ||||||
Current assets | ||||||
Cash and cash equivalents | $ | 414,904 | $ | 702,422 | ||
Restricted cash | 1,410 | — | ||||
Prepaids and other current assets | 14,546 | 6,463 | ||||
Total current assets | 430,860 | 708,885 | ||||
Property and equipment, net | 140,867 | 30,426 | ||||
Operating lease right-of-use assets | 14,501 | 12,913 | ||||
Other assets | 28,319 | 1,246 | ||||
Total assets | $ | 614,547 | $ | 753,470 | ||
Liabilities and stockholders' equity | ||||||
Liabilities | ||||||
Current liabilities | ||||||
Accounts payable | $ | 63,322 | $ | 17,243 | ||
Accrued expenses and other current liabilities | 43,388 | 10,625 | ||||
Total current liabilities | 106,710 | 27,868 | ||||
Contingent earnout shares liability | 32,337 | 133,503 | ||||
Private placement warrants liability | — | 6,613 | ||||
Operating lease liabilities | 14,032 | 13,262 | ||||
Long-term debt | — | 6,943 | ||||
Other long-term liabilities | — | 39 | ||||
Total liabilities | 153,079 | 188,228 | ||||
Stockholders' equity | ||||||
Preferred stock, | — | — | ||||
Common stock, | 24 | 24 | ||||
Additional paid-in capital | 1,015,461 | 910,579 | ||||
Accumulated deficit | (554,017) | (345,361) | ||||
Total stockholders' equity | 461,468 | 565,242 | ||||
Total liabilities and stockholders' equity | $ | 614,547 | $ | 753,470 | ||
CANOO INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share values) UNAUDITED | |||||||||||||
Three months ended | Nine months ended | ||||||||||||
September 30, | September 30, | ||||||||||||
2021 | 2020 | 2021 | 2020 | ||||||||||
Revenue | $ | — | $ | 2,550 | $ | — | $ | 2,550 | |||||
Costs and Operating Expenses | |||||||||||||
Cost of revenue, excluding depreciation | — | 670 | — | 670 | |||||||||
Research and development expenses, excluding depreciation | 59,387 | 18,923 | 158,033 | 52,858 | |||||||||
Selling, general and administrative expenses, excluding depreciation | 45,510 | 8,405 | 144,072 | 15,897 | |||||||||
Depreciation | 2,109 | 1,738 | 6,317 | 5,179 | |||||||||
Total costs and operating expenses | 107,006 | 29,736 | 308,422 | 74,604 | |||||||||
Loss from operations | (107,006) | (27,186) | (308,422) | (72,054) | |||||||||
Other (expense) income | |||||||||||||
Interest income (expense) | 33 | (1,094) | 79 | (10,465) | |||||||||
Gain on extinguishment of debt | — | 5,045 | — | 5,045 | |||||||||
Gain on fair value change in contingent earnout shares liability | 25,764 | — | 101,166 | — | |||||||||
Loss on fair value change in private placement warrants liability | — | — | (1,639) | — | |||||||||
Other income (expense), net | 334 | (155) | 160 | (47) | |||||||||
Loss before income taxes | (80,875) | (23,390) | (208,656) | (77,521) | |||||||||
Provision for income taxes | — | — | — | — | |||||||||
Net loss and comprehensive loss | $ | (80,875) | $ | (23,390) | $ | (208,656) | $ | (77,521) | |||||
Per Share Data: | |||||||||||||
Net loss per share, basic and diluted | $ | (0.35) | $ | (0.20) | $ | (0.92) | $ | (0.82) | |||||
Weighted-average shares outstanding, basic and diluted | 228,477 | 116,293 | 226,747 | 94,058 | |||||||||
CANOO INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (in thousands) UNAUDITED | ||||||
Nine months ended | ||||||
September 30, | ||||||
2021 | 2020 | |||||
Cash flows from operating activities: | ||||||
Net loss | $ | (208,656) | $ | (77,521) | ||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||
Depreciation | 6,317 | 5,179 | ||||
Non-cash operating lease expense | 774 | 471 | ||||
Loss on the disposal of property and equipment | — | 9 | ||||
Debt discount amortization | — | 2,590 | ||||
Gain on extinguishment of debt | — | (5,045) | ||||
Stock-based compensation | 89,758 | 1,059 | ||||
Gain on fair value in contingent earnout shares liability | (101,166) | — | ||||
Loss on fair value change in private placement warrants liability | 1,639 | — | ||||
Changes in operating assets and liabilities: | ||||||
Prepaids and other current assets | (8,915) | (3,186) | ||||
Other assets | (939) | 726 | ||||
Accounts payable | 23,920 | 1,082 | ||||
Accrued interest expense | — | 7,927 | ||||
Accrued expenses and other current liabilities | 16,647 | 1,618 | ||||
Net cash used in operating activities | (180,621) | (65,091) | ||||
Cash flows from investing activities: | ||||||
Purchases of property and equipment | (73,976) | (1,209) | ||||
Prepayment to VDL Nedcar | (26,134) | — | ||||
Net cash used in investing activities | (100,110) | (1,209) | ||||
Cash flows from financing activities: | ||||||
Proceeds from related party convertible debt | — | 90,000 | ||||
Proceeds from convertible debt | — | 90,500 | ||||
Loan advance | — | 7,017 | ||||
Repayments on loan advance | — | (57) | ||||
Proceeds from issuance of shares | — | 3 | ||||
Repurchase of restricted shares | — | (27) | ||||
Proceeds from exercise of public warrants | 6,879 | — | ||||
Repurchase of unvested shares | (7) | — | ||||
Payment of offering costs | (5,306) | (1,307) | ||||
Repayment of PPP loan | (6,943) | — | ||||
Net cash (used in) provided by financing activities | (5,377) | 186,129 | ||||
Net (decrease) increase in cash, cash equivalents, and restricted cash | (286,108) | 119,829 | ||||
Cash, cash equivalents, and restricted cash | ||||||
Cash, cash equivalents, and restricted cash, beginning of period | 702,422 | 29,507 | ||||
Cash, cash equivalents, and restricted cash, end of period | $ | 416,314 | $ | 149,336 | ||
Reconciliation of cash, cash equivalents, and restricted cash to the condensed consolidated balance sheets | ||||||
Cash and cash equivalents at end of period | $ | 414,904 | $ | 148,836 | ||
Restricted cash at end of period | 1,410 | 500 | ||||
Total cash, cash equivalents, and restricted cash at end of period shown in the condensed consolidated statements of | $ | 416,314 | $ | 149,336 | ||
Supplemental non-cash investing and financing activities | ||||||
Acquisition of property and equipment included in current liabilities | $ | 46,774 | $ | 4,137 | ||
Offering costs included in accounts payable | $ | 8,001 | $ | — | ||
Offering costs included in accrued and other current liabilities | $ | — | $ | 2,254 | ||
Recognition of operating lease right-of-use asset | $ | 2,362 | $ | — | ||
Conversion of private placement warrants to public warrants | $ | 8,252 | $ | — | ||
Exchange of convertible debt | $ | — | $ | 291,309 | ||
Gain on extinguishment of related party convertible debt recorded in additional paid-in capital | $ | — | $ | 44,785 | ||
Issuance of long-term debt in exchange for loan advance | $ | — | $ | 7,017 | ||
Supplemental disclosures of cash flow information | ||||||
Cash paid for interest | $ | 60 | $ | — | ||
CANOO INC.
ADJUSTED EBITDA RECONCILIATION TABLE
The following table reconciles Net loss to EBITDA and Adjusted EBITDA: | ||||||||||||
Three Months Ended | Nine Months Ended | |||||||||||
September 30, | September 30, | |||||||||||
(in thousands) | 2021 | 2020 | 2021 | 2020 | ||||||||
Net loss | $ | (80,875) | $ | (23,390) | $ | (208,656) | $ | (77,521) | ||||
Interest (income) expense | (33) | 1,094 | (79) | 10,465 | ||||||||
Provision for income taxes | — | — | — | — | ||||||||
Depreciation | 2,109 | 1,738 | 6,317 | 5,179 | ||||||||
EBITDA | (78,799) | (20,558) | (202,418) | (61,877) | ||||||||
Adjustments: | ||||||||||||
Gain on fair value change in contingent earnout shares liability | (25,764) | — | (101,166) | — | ||||||||
Loss on fair value change in private placement warrants liability | — | — | 1,639 | — | ||||||||
Other (income) expense, net | (334) | 155 | (160) | 47 | ||||||||
Stock-based compensation | 19,098 | 319 | 89,758 | 1,059 | ||||||||
Adjusted EBITDA | $ | (85,799) | $ | (20,084) | $ | (212,347) | $ | (60,771) | ||||
Forward-Looking Statements
The information in this press release includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "estimate," "plan," "project," "forecast," "intend," "will," "expect," "anticipate," "believe," "seek," "target" or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. These forward-looking statements include, but are not limited to, statements regarding estimates and forecasts of financial and performance metrics, projections of market opportunity and market share, expectations and timing related to commercial product launches and achievement of other operational milestones, including the ability to meet and/or accelerate anticipated production timelines, Canoo's ability to capitalize on commercial opportunities, anticipated customer orders, and expectations regarding development of facilities and the negotiation, availability or receipt of state incentives. These statements are based on various assumptions, whether or not identified in this press release, and on the current expectations of Canoo's management and are not predictions of actual performance. These forward-looking statements are provided for illustrative purposes only and are not intended to serve as, and must not be relied on by any investor as, a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of Canoo. These forward-looking statements are subject to a number of risks and uncertainties, including changes in domestic and foreign business, market, financial, political and legal conditions; failure to realize the anticipated benefits of the business combination with Hennessy Capital Acquisition Corp. IV; the rollout of Canoo's business and the timing of expected business milestones and commercial launch; future market adoption of Canoo's offerings; risks related to Canoo's go-to-market strategy and manufacturing strategy; the effects of competition on Canoo's future business; the ability to issue equity or equity-linked securities, and those factors discussed under the captions "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in Canoo's Annual Report on Form 10-K for the fiscal year ended December 31, 2020 filed with the U.S. Securities and Exchange Commission (the "SEC") on March 31, 2021, as well as its Quarterly Reports on Form 10-Q and other filings with the SEC, copies of which may be obtained by visiting Canoo's Investors Relations website at investors.canoo.com or the SEC's website at www.sec.gov. If any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. There may be additional risks that Canoo does not presently know or that Canoo currently believes are immaterial that could also cause actual results to differ from those contained in the forward-looking statements. In addition, forward-looking statements reflect Canoo's expectations, plans or forecasts of future events and views as of the date of this press release. Canoo anticipates that subsequent events and developments will cause Canoo's assessments to change. However, while Canoo may elect to update these forward-looking statements at some point in the future, Canoo specifically disclaims any obligation to do so. These forward-looking statements should not be relied upon as representing Canoo's assessments as of any date subsequent to the date of this press release. Accordingly, undue reliance should not be placed upon the forward-looking statements.
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