Sun, 21 Jul 2019

VANCOUVER, BC / ACCESSWIRE / April 16, 2019 / Grande West Transportation Group Inc. (TSXV: BUS; OTC PINK: GWTNF) (''Grande West'' or the ''Company''), a Canadian manufacturer of mid-sized multi-purpose transit vehicles for sale in Canada and the United States, is pleased to announce financial results for the fourth quarter and the year ended December 31, 2018.

Fourth Quarter and Yearly 2018 Highlights

  • Record bus, aftermarket parts and other revenue of $70,076,720 for the year ended December 31, 2018 compared to $54,701,931 for the year ended December 31, 2017
  • Record 2018 adjusted EBITDA of $5,224,549 for the year ended December 31, 2018 compared to $770,394 for the year ended December 31, 2017 (see ''reconciliation of net earnings to adjusted EBITDA'')
  • Record net income of $948,951 for the year ended December 31, 2018 compared to a net loss of $416,693 for the year ended December 31, 2017
  • Record deliveries of 180 Vicinity buses, including 7 new leased buses, for the year ended December 31, 2018 compared to 152 buses delivered for the year ended December 31, 2017
  • Bus, aftermarket parts and other revenue for the three months ended December 31, 2018 of $8,511,617 compared to for the three months ended December 31, 2017
  • Net loss for the three months ended December 31, 2018 of $1,154,588 compared to net loss of $641,714 for the three months ended December 31, 2017
  • Adjusted EBITDA for the three months ended December 31, 2018 of $26,927 compared to an adjusted EBITDA loss of $483,967 for the three months ended December 31, 2017 (see "reconciliation of net earnings to adjusted EBITDA")
  • Deliveries of 19 Vicinity buses, including one new leased bus, for the three months ended December 31, 2018 compared to 33 for the three months ended December 31, 2017

Selected Yearly, Quarterly and Periodic Information

The following table shows the financial results of the Company for the years and fourth quarters ended December 31, 2018 and December 31, 2017.

The results of operations for these periods are not necessarily indicative of the results of operations to be expected in any given comparable period.


3 Months Ended,
December 31, 2018

3 Months Ended,
December 31, 2017

12 Months Ended, December 31, 2018

12 Months Ended, December 31, 2017

(unaudited)

$

$

$

$

Revenue

8,511,617

12,508,075

70,076,720

54,701,931

Gross margin

2,116,977

1,425,214

11,924,317

6,319,415

Net income (loss)

(1,154,588)

(641,714)

948,951

(416,693)

Basic and diluted loss per share

(0.02)

(0.01)

0.01

(0.01)


December 31,
2018

December 31,
2017

(unaudited)

$

$

Cash and cash equivalents

2,732,437

4,223,350

Working capital

16,921,864

14,886,254

Total assets

40,445,904

46,962,090

Non-current financial liabilities

2,404,022

2,643,913

The Company reports results for the year ended December 31, 2018 of 180 Vicinity buses delivered, revenue of $70,076,720, net income of $948,951 and gross margin of 11,924,317. Results for the year ended December 31, 2017 were 152 buses delivered, revenue of $54,701,931, net loss of $416,693 and gross margin of $6,319,415. Gross margin for the year ended December 31, 2018 was 17% of revenue compared to 12% in 2017.

The Company reports Q4 2018 results of 19 Vicinity buses delivered, revenue of $8,511,617, net loss of $1,154,588 and gross margin of $2,116,977, which was 25% of revenue. Results for the fourth quarter of 2017 were 33 buses delivered, revenue of $12,508,075, net loss of $641,714 and gross margin of $1,425,214, which was 11% of revenue.

Backlog: Current total firm orders are for approximately 170 buses valued at over $58 million. Deliveries will vary from quarter to quarter to account for different build specifications, customer acceptance and revenue recognition.

Jean-Marc Landry, Grande West CEO, stated, ''2018 was the 10 year anniversary of Grande West and represented a pivotal year for the Company. We made significant changes at the board and management levels, recognized record deliveries of buses with increased margins and overall profit, and were successful in receiving our first Buy America orders to be delivered in 2019.''

Reconciliation of Net earnings to Adjusted EBITDA

Management believes that Adjusted EBITDA is an important measure in evaluating the historical operating performance of the Company. However, Adjusted EBITDA is not a recognized earnings measure under IFRS and does not have a standardized meaning prescribed by IFRS. Accordingly, Adjusted EBITDA may not be comparable to similar measures presented by other issuers. Readers of this MD&A are cautioned that Adjusted EBITDA should not be construed as an alternative to net earnings or loss determined in accordance with IFRS as indicators of the Company's performance, or cash flows from operating activities determined in accordance with IFRS as a measure of liquidity and cash flow. The Company defines and has computed EBITDA as earnings before interest, income taxes, depreciation and amortization, foreign exchange gains or losses, non-operating income and expenses, and share based compensation.

The following table reconciles net earnings or losses to Adjusted EBITDA based on the consolidated financial statements of the Company for the periods indicated.


3 Months Ended
December 31,
2018

3 Months Ended
December 31,
2017

Year Ended
December 31,
2018

Year Ended
December 31,
2017

(unaudited)

$

$

$

$

Net Comprehensive loss

(1,154,588)

(641,714)

948,951

(416,693)

Add back





Stock based compensation

429,837

(4,718)

1,592,310

366,637

Interest

214,489

193,767

1,114,721

789,573

Foreign exchange (gain) loss

233,447

(167,610)

835,585

(314,451)

Amortization

303,742

136,308

732,982

345,328

Adjusted EBITDA

26,927

(483,967)

5,224,549

770,394

Business Overview

Corporate Update

Grande West has delivered over 400 buses in the Canadian and U.S. markets and continues to deliver on its backlog of orders. The Company is the market leader in the mid-size bus category in Canada where it sells its Vicinity branded buses and has maintained this position through 2018.

During 2018, the Company made significant changes at the management and board levels. Jean-Marc Landry was named Chief Executive Officer, Dan Buckle joined the Company as Chief Financial Officer, and Rob Mowat joined the Company as VP of Sales and Marketing. The Company named two new directors, Christopher Strong joined the board as the chair of both the Audit Committee and Compensation Committee, and Keith Parker joined as a board member.

The Company announced on August 28, 2018 that it has successfully completed an independent third party audit of its Buy America assembly and financial bill of materials on its Vicinity bus in order to meet current Federal Transit Administration (''FTA'') requirements. Regarding U.S. manufacturing, we worked diligently to set up our U.S. assembly processes and increased our U.S. material content to meet Buy America requirements. We are scheduled to deliver our first Buy America bus builds in 2019.

Grande West's U.S. distributor, ABG was successful in winning:
  • The Georgia State bid for Vicinity 30' and 35' heavy-duty vehicles. The contract allows for all transportation authorities state-wide to purchase Vicinity buses with Federal funding as well as all public agencies nationally to purchase with local funding.
  • A five-year contract for 30' Buy America heavy-duty low floor buses. The order is for up to 63 Vicinity buses over the term of the contract. The City of Oxford, Mississippi is the Executive Agent on behalf of a group of agencies listed for the procurement of the heavy duty transit buses, under a management contract with RATP Dev USA. The Company received initial orders for a total of 7 buses with two different customers under this contract for delivery in 2019.
  • The Iowa Department of Transportation bid for Vicinity 30' and 35' heavy-duty diesel vehicles, with the option for CNG. This bid is conducted on behalf of Iowa's 35 designated public transit agencies, state of Iowa governmental agencies, state board of regents, and other states' public transit agencies that are in the same metropolitan planning organization as a designated public transit agency. The Bid is in place until October 2020. There are no minimum or maximum bus quantities, orders from the various agencies are subject to funding and agency needs.

Successfully winning these bids and contracts in the U.S. during the third and fourth quarters is confirmation that Grande West can compete in the U.S. public transit market.

Grande West announced that it would sell Vicinity buses directly to customers across all of Canada instead of going through a dealer in Eastern Canada effective October 31, 2018. The decision was made to be closer to customers and optimize all aspects of the relationship throughout the life of the bus. The Company has also hired a new customer engagement manager and service technician based in Montreal to focus on business development and customer support in Eastern Canada.

In Canada, Grande West received firm orders from The City of Medicine Hat, The County of Grande Prairie and a private operator in Quebec. These orders are all new customers for Grande West.

Other noteworthy achievements during 2018 were the substantial increase in margins and cashflows from operations in 2018 compared to 2017, the repayment of high interest debt, and the implementation a new ERP system which will help increase efficiencies and reduce costs into the future.

Recent Developments

In October of 2018, the Company announced a new contract to purchase Buy America Vicinity buses by a group of Mississippi-based transit authorities. Grande West, along with U.S. distributor Alliance Bus Group ('ABG'), was the winning bid for a five-year contract for 30' heavy-duty low floor buses. The order is for up to 63 Vicinity buses over the term of the contract. The City of Oxford, Mississippi is the Executive Agent on behalf of a group of agencies listed for the procurement of the heavy duty transit buses, under a management contract with RATP Dev USA. Each participating agency has submitted their purchase forecast for the term of this contract. Purchase orders will be announced as they are received by the Company. Grande West received initial orders for a total of 7 buses from two customers off this contract for delivery in 2019.

In November of 2018, Grande West received firm orders valued at approximately $6,000,000 from The City of Medicine Hat, The County of Grande Prairie and a private operator in Quebec.

In November of 2018, Grande West's U.S. distributor, ABG was successful in winning the Iowa DOT bid for Vicinity 30' and 35' heavy-duty diesel vehicles, with options for CNG. This bid is conducted on behalf of Iowa's 35 designated public transit agencies, state of Iowa governmental agencies, state board of regents, and other states' public transit agencies that are in the same metropolitan planning organization as a designated public transit agency. The Bid is in place until October 2020. There are no minimum or maximum bus quantities, orders from the various agencies are subject to funding and agency needs.

In March of 2019, Grande West announced a purchase order with BC Transit for over 30 CNG powered Vicinity buses for approximately $13,000,000.

Additional information is provided in the Management's Discussion and Analysis at http://sedar.com/.

A conference call for analysts and interested listeners will be held on Wednesday, April 17, 2019 at 11:00 AM EST. The call-in number is (844) 602-0380 and the webcast login is https://www.investornetwork.com/event/presentation/45575. A recording will be available on the website shortly after the call.

About Grande West Transportation Group

Grande West is a Canadian company that designs, engineers and manufactures mid-size multi-purpose transit vehicles for public and commercial enterprises. Grande West's Best-in-Class heavy-duty Vicinity bus is available in 27.5, 30 and 35 foot models powered by clean diesel or CNG designed with affordability, accessibility and global responsibility in mind. It costs significantly less than a regular 40 foot transit bus, is more maneuverable, burns less fuel and emits less harmful emissions.

The Company has been successful in supplying Canadian municipal transportation agencies and private operators with new buses and is receiving follow-on orders in many Canadian transit agencies. Grande West is compliant to Buy America certification, and along with Alliance Bus Group (''ABG''), its exclusive US distributor, is actively pursuing opportunities in public and private transit fleet operations that would benefit from Grande West's vehicles.

For further information please contact:

Grande West Transportation

John LaGourgue
VP Corporate Development
Ph: 1-604-607-4000
jlagourgue@grandewest.com
www.grandewest.com

Neither the TSX-V nor its Regulation Service Provider (as that term is defined in the policies of the TSX-V) accepts responsibility for the adequacy or accuracy of this release.

Cautionary Note Regarding Forward-Looking Statements

This press release includes certain 'forward-looking information" and 'forward-looking statements'' (collectively 'forward-looking statements'') within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical fact, included herein, including without limitation, statements regarding the use of proceeds from the Private Placement, are forward-looking statements. Forward-looking statements are frequently, but not always, identified by words such as 'expects'', 'anticipates", 'believes'', 'intends'', 'estimates'', 'potential", 'possible'', and similar expressions, or statements that events, conditions, or results 'will'', 'may'', 'could'', or 'should'' occur or be achieved. Forward-looking statements involve various risks and uncertainties. There can be no assurance that such statements will prove to be accurate, and actual results and future events could differ materially from those anticipated in such statements.

Important factors that could cause actual results to differ materially from Grande West's expectations include uncertainties relating to the receipt of final approval from the TSX-V; and other risk and uncertainties disclosed in Grande West's reports and documents filed with applicable securities regulatory authorities from time to time. Grande West's forward-looking statements reflect the beliefs, opinions and projections on the date the statements are made. Grande West assumes no obligation to update the forward-looking statements or beliefs, opinions, projections, or other factors, should they change, except as required by law.

SOURCE: Grande West Transportation

More Philadelphia News

Access More

Sign up for Philadelphia News

a daily newsletter full of things to discuss over drinks.and the great thing is that it's on the house!