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Lion Electric posts record revenue in Q2 results

The company managed approximately $538,000 in gross profits

IMAGE: Aerial view of Lion Electric's Joliet, Ill. facility
An aerial view of Lion Electric's Joliet, Ill. facility. (Courtesy the Lion Electric Company)

The Lion Electric Company (LEV-T) reports record revenues of approximately $78.1 million in its Q2 2023 financial report, up from $39.7 million in the same period last year.

While that record also comes with a net loss of $15.8 million for the period ending June 30, as compared to net earnings of $50.5 million in Q2 2022, the medium- and heavy-duty electric vehicle manufacturer managed around $538,000 in gross profits.

"We are pleased with our performance in the second quarter of 2023, as we continued to see gradual growth in revenue and in truck deliveries," Marc Bedard, Lion Electric’s (LEV-T) CEO and founder, said in a statement.

"As we recently closed a $142 million financing that provides us with the flexibility to execute our growth plans, we will continue to focus our efforts on achieving profitability, which is moving in the right direction, as demonstrated by the positive gross margin we posted this quarter.”

Lion Electric designs and manufactures Class 5 to Class 8 commercial urban trucks and all-electric buses and minibuses for schools, paratransit and mass transit. The company went public in May 2021.

It currently has approximately 1,450 employees.

Lion Electric’s Q2

As of August 2, the Saint-Jérôme, Que.-based company has more than 1,400 vehicles on the road, with over 14 million miles driven.

It has a vehicle order book of 2,559 all-electric vehicles, consisting of 304 trucks and 2,255 buses, representing a combined total order value of approximately $842.1 million. There is also an order book of 275 charging stations and related services via LionEnergy.

This quarter, Lion Electric delivered 199 vehicles, an increase of 94 vehicles as compared to the 105 delivered in the same period in 2022. This included 33 trucks, 14 of which were ordered by Tampa-based Bolt Logistics.

The increase in revenue was primarily due to this increase in vehicle sales.

“Our average selling price also trended upwards, positively impacting our gross margins,” Nicholas Brunet, Lion Electric’s executive vice-president and chief financial officer, said during the earnings call. “During Q2 '23, we also continued to improve gross margins, reaching 0.7 per cent due to the positive impact of increased sales volumes, product mix and higher manufacturing tube.”

Lion Electric reported an adjusted EBITDA of approximately minus $13 million, as compared to minus $19.4 million in Q2 2022, after mainly adjusting for certain non-cash items such as change in fair value of share warrant obligations and share-based compensation.

The company now has 12 experience centres in the U.S. and Canada, aimed at customer service. Bedard said this is enough “for the foreseeable future.”

Lion Electric looking ahead  

Lion Electric recently inaugurated its 900,000-square-foot Joliet, Ill. manufacturing facility, which is aiming for a manufacturing capacity of 2,500 all-electric school buses annually by the end of 2023. This will include production of the new Lion5 Class 5 electric truck, which was launched in May.

“We are working closely with school districts and operators to help our clients secure grant funding under this program,” Bedard said during the earnings call. “This is just one example out of many others as we are seeing new programs and legislation, including in Texas, Michigan, Illinois, among others.”

The company is confident it will experience increased revenues in the school bus sector in the quarters to come.

“If you're looking, also the results that we have with respect to the EPA and a lot of Canadian programs as well, we're doing good. We're doing good,” Bedard said in response to a question. “So definitely, we see an increase in the revenues and the number of deliveries in the upcoming quarters. But that's going to be sequential.”

At its battery campus in Mirabel, Que., the company plans to have a production capacity of 1.7 gigawatt-hours per year by the end of 2023. This will be enough to power approximately 5,000 of Lion Electric’s school buses and trucks.

It is progressing on final certification of the first Lion battery packs. As stated during the webcast, Lion’s Electric’s goal is to gradually decrease its reliance on third-party battery manufacturers.

Lion's capital expenditures, which included costs related to the Joliet facility and the Lion campus, amounted to $25.7 million, down $33.9 million as compared to $59.6 million in the same period in 2022.

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