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We stay assured within the function that different fuels will play in driving sustainability in the way forward for the transportation and industrial software area. Relating to hydrogen, we acknowledge the slowdown in infrastructure improvement within the international market, which has tapered the adoption of automotive and industrial functions powered by hydrogen. The success of this market will depend on the set up of infrastructure and the manufacturing of unpolluted hydrogen, each of which have been gradual to materialize.  Nonetheless, we’re steadfast in our perception that hydrogen as a gasoline will prevail – though gradual versus fast – and develop into a clear gasoline supply that’s adopted worldwide. Within the meantime, Westport at the moment delivers a collection of confirmed and progressive elements and techniques for a variety of inexpensive different low-carbon fuels comparable to pure fuel, renewable pure fuel, propane, and hydrogen. We’re driving cleaner efficiency by addressing decrease emissions laws with sensible functions utilizing innovation accessible right this moment.

As we navigate the following quarter, and the following yr, Westport is strongly dedicated to driving operational excellence, nurturing innovation, and supporting Cespira, all to place the Firm for sustainable development in an evolving panorama. We’re targeted and devoted to the current and our future.”

Dan Sceli, Chief Government Officer, Westport Fuel Systems

Q3 2024 Highlights

• Revenues decreased by 14% to $66.2 million in comparison with $77.4 million in the identical quarter final yr, primarily pushed by the transition of the Heavy-Responsibility OEM revenues now being mirrored within the outcomes of Cespira, of which Westport accounts for as an fairness funding.
• Web lack of $3.9 million for the quarter, an enchancment over the web lack of $11.9 million for a similar quarter final yr. This was primarily the results of an enchancment in gross margin by $1.3 million in comparison with the prior yr quarter, a big lower in working expenditures and depreciation and amortization as prices beforehand related to our HPDI enterprise at the moment are accrued by Cespira, price reductions in Westport and a web international trade achieve of $1.1 million.
• Continued enchancment in Adjusted EBITDA ^[2] reaching damaging $0.8 million in comparison with damaging $3.0 million for a similar interval in 2023.
• Money and money equivalents had been $33.3 million on the finish of the third quarter of 2024. Money utilized in working actions was $9.9 million primarily from a rise in working capital of $11.4 million. Money supplied by investing actions included the sale of investments for $9.6 million associated to the gathering of $8.4 million from the formation of the HPDI JV and sale of our possession curiosity in Westport Weichai Inc. (“Weichai”), partially offset by the acquisition of capital belongings of $2.1 million. Money utilized in financing actions represented debt repayments of $7.0 million within the quarter.
• In September 2024, HPDI Expertise, the three way partnership between Volvo Group and Westport, launched as Cespira.

⁽¹⁾ This contains revenue (loss) from Minda Westport Applied sciences Restricted and Cespira.

⁽²⁾ Gross margin, EBITDA and Adjusted EBITDA are non-GAAP measures. Please confer with GAAP and NON-GAAP FINANCIAL MEASURES for the reconciliation to equal GAAP measures and limitations on using such measures.

Phase Data

Mild-Responsibility Phase

Income for the three and 9 months ended September 30, 2024 was $61.5 million and $194.2 million, respectively, in contrast with $60.2 million and $200.4 million for the three and 9 months ended September 30, 2023.

Mild-Responsibility income elevated by $1.3 million for the three months ended September 30, 2024 in comparison with the prior yr quarter, primarily a results of a rise in gross sales in our light-duty OEM and IAM companies and partially offset by decreased gross sales in our gasoline storage, DOEM, and electronics companies. For the 9 months ended September 30, 2024, Mild-Responsibility income decreased by $6.2 million in comparison with the prior yr interval, primarily pushed by a lower in gross sales in our DOEM, and gasoline storage companies and partially offset by a rise in gross sales in our light-duty OEM, electronics, and IAM companies.

Gross margin elevated by $1.9 million to $13.9 million, or 23% of income, for the three months ended September 30, 2024 in comparison with $12.0 million, or 20% of income, for the three months ended September 30, 2023. This was primarily pushed by a slight improve in gross sales volumes, a change in gross sales combine with will increase in gross sales to European clients and discount in gross sales to creating areas.

Gross margin elevated by $4.3 million to $41.4 million, or 21% of income, for the 9 months ended September 30, 2024 in comparison with $37.1 million, or 19% of income, for the 9 months ended September 30, 2023. This was primarily pushed by a change in gross sales combine with a rise in gross sales to European clients and a discount in gross sales to creating areas.

Westport started supplying its Euro 6 LPG gasoline system to its international OEM buyer in early 2024. Regardless of a slower begin to manufacturing than anticipated, Westport expects to exceed deliberate Euro 6 LPG gasoline system deliveries in 2024. This manufacturing provide settlement has been instrumental in bettering income and delivering greater margins, which greater than offset the decline in income on account of a key delayed OEM buyer persevering with to work by their stock. Manufacturing for the Euro 7 LPG gasoline system for a similar international OEM buyer is anticipated to start mid-to-late 2025.

The Mild-Responsibility phase continues to evolve our LPG gasoline system resolution, offering extra clients with a cost-competitive different gasoline resolution. Just lately, two new product platforms had been introduced using our techniques. Westport was excited to be a part of the first-ever OEM hybrid automobile powered by HEV and LPG applied sciences – the Kia Niro Tri-Gasoline in Italy. This revolutionary product, born from Westport’s historic partnership with Kia Italia, presents three gasoline sources—petrol, electrical, and LPG—delivering over 1,600 km on full tanks with decreased emissions and uncompromised efficiency. Westport additionally introduced the worldwide availability of a LPG gasoline system for the RAM 1500 Hurricane 3.0 DI Twin Turbo engine, enabling clients to learn from decrease emissions and decrease gasoline prices.

Excessive-Strain Controls & Methods Phase

Income for the three and 9 months ended September 30, 2024, was $1.6 million and $7.4 million, respectively, in contrast with $3.7 million and $9.4 million for the three and 9 months ended September 30, 2023. The lower in income for the three months ended September 30, 2024 in comparison with the prior yr quarter was primarily pushed by the overall slowdown within the hydrogen infrastructure improvement resulting in a slower adoption of automotive and industrial functions powered by hydrogen.

Gross margin decreased by $0.6 million to $0.4 million, or 25% of income, for the three months ended September 30, 2024 in comparison with $1.0 million or 27% of income, for the three months ended September 30, 2023. Gross margin decreased by $0.9 million to $1.5 million, or 20% of income, for the 9 months ended September 30, 2024 in comparison with $2.4 million, or 26% of income, for the 9 months ended September 30, 2023. This was primarily pushed by decrease gross sales quantity within the quarter.

Heavy-Responsibility OEM Phase

Income for the three and 9 months ended September 30, 2024 contains income from the HPDI enterprise from January 1 to June 3, the cut-off date of the transaction to kind Cespira plus income earned beneath a transitional providers settlement. Income for the three and 9 months ended September 30, 2024 was $3.1 million and $25.6 million, respectively, in contrast with $13.5 million and $34.9 million for the three and 9 months ended September 30, 2023.

The lower in income for the three months ended September 30, 2024 is a results of the transition of this enterprise to Cespira and the ensuing change in accounting therapy. We proceed to earn service income from Cespira beneath the transitional providers settlement for the quarter, which is represented on this phase.

Gross margin was $0.2 million, or 6% of income, for the three months ended September 30, 2024 in comparison with $0.2 million or 1% of income, for the three months ended September 30, 2023. Gross margin decreased by $1.0 million to $0.4 million, or 2% of income, for the 9 months ended September 30, 2024 in comparison with $1.4 million, or 4% of income, for the 9 months ended September 30, 2023.

Chosen Cespira Statements of Operations Knowledge

We account for Cespira utilizing the fairness methodology of accounting for investments.

The next desk units forth a abstract of the monetary outcomes of Cespira for the three months ended September 30, 2024 and the interval between June 3, 2024 to September 30, 2024:

⁽¹⁾ Gross margin is a non-GAAP measure. Please confer with GAAP and NON-GAAP FINANCIAL MEASURES for the reconciliation to equal GAAP measures and limitations on using such measures.

Cespira earned income of $16.2 million for 3 months ended September 30, 2024. For the prior yr quarter, the Heavy-Responsibility OEM phase included our HPDI enterprise which earned $13.5 million. The income improve is basically pushed by a rise in HPDI techniques bought.

Cespira misplaced $1.1 million on gross margin for 3 months ended September 30, 2024. For the prior yr quarter, the Heavy-Responsibility OEM phase earned $0.2 million.

Cespira had working losses of $5.3 million for the three months ended September 30, 2024. For the prior yr quarter, Heavy-Responsibility OEM had incurred working losses of $3.7 million.

As beforehand introduced, Westport and Weichai are events to a know-how improvement and provide settlement which incorporates an obligation for Weichai to order, and Westport to provide, sure volumes of HPDI gasoline system elements previous to December 31, 2024. Vital orders for HPDI gasoline system elements towards this settlement haven’t been acquired thus far and we don’t at the moment anticipate that orders for any important extra volumes can be acquired previous to yr finish. Westport and Cespira proceed to collaborate with Weichai Energy Co. Ltd (“Weichai Energy”) on an HPDI gasoline system outfitted model of the Weichai Energy engine platforms. The events are at the moment discussing the following phases of this work and the obligations of every social gathering going ahead.

Q3 2024 Convention Name
Westport has scheduled a convention name on November 13, 2024, at 7:00 am Pacific Time (10:00 am Japanese Time) to debate these outcomes. To entry the convention name please register at https://register.vevent.com/register/BI0e453d34cd1c4f7da856b4eec14f0d4c . The stay webcast of the convention name could be accessed by the Westport web site at https://investors.wfsinc.com/ .

The webcast can be archived on Westport’s web site at https://traders.wfsinc.com.

Monetary Statements and Administration’s Dialogue and Evaluation
To view Westport financials for the second quarter ended September thirtieth, 2024, please go to https://investors.wfsinc.com/financials/

About Westport Fuel Systems

At Westport Fuel Systems, we’re driving innovation to energy a cleaner tomorrow. We’re a number one provider of superior gasoline supply elements and techniques for clear, low-carbon fuels comparable to pure fuel, renewable pure fuel, propane, and hydrogen to the worldwide transportation trade. Our know-how delivers the efficiency and gasoline effectivity required by transportation functions and the environmental advantages that deal with local weather change and concrete air high quality challenges. Headquartered in Vancouver, Canada, with operations in Europe, Asia, North America, and South America, we serve our clients in additional than 70 nations with main international transportation manufacturers. At Westport Fuel Systems, we expect forward. For extra data, go to www.wfsinc.com.

Cautionary Be aware Relating to Ahead Trying Statements
This press launch incorporates forward-looking statements, together with statements relating to income and money utilization expectations, future strategic initiatives and future development, way forward for our improvement applications (together with these regarding HPDI and hydrogen), the demand for our merchandise, the long run success of our enterprise and know-how methods, intentions of companions and potential clients, the efficiency and competitiveness of Westport’s merchandise and enlargement of product protection, future market alternatives, pace of adoption of pure fuel and hydrogen for transportation and phrases and timing of present and future agreements in addition to Westport’s administration’s response to any of the aforementioned components. These statements are neither guarantees nor ensures, however contain recognized and unknown dangers and uncertainties and are primarily based on each the views of administration and assumptions that will trigger our precise outcomes, ranges of exercise, efficiency or achievements to be materially totally different from any future outcomes, ranges of actions, efficiency or achievements expressed in or implied by these ahead wanting statements. These dangers, uncertainties and assumptions embody these associated to our income development, working outcomes, trade and merchandise, the overall economic system, situations of and entry to the capital and debt markets, solvency, governmental insurance policies and regulation, know-how improvements, fluctuations in international trade charges, working bills, continued discount in bills, capability to efficiently commercialize new merchandise, the efficiency of our joint ventures, the provision and worth of pure fuel and hydrogen, international authorities stimulus packages and new environmental laws, the acceptance of and shift to pure fuel and hydrogen automobiles, the relief or waiver of gasoline emission requirements, the lack of fleets to entry capital or authorities funding to buy pure fuel and hydrogen automobiles, the event of competing applied sciences, our capability to adequately develop and deploy our know-how, the actions and determinations of our three way partnership and improvement companions, ongoing provide chain challenges in addition to different threat components and assumptions that will have an effect on our precise outcomes, efficiency or achievements or monetary place mentioned in our most up-to-date Annual Data Kind and different filings with securities regulators. Readers mustn’t place undue reliance on any such forward-looking statements, which communicate solely as of the date they had been made. We disclaim any obligation to publicly replace or revise such statements to mirror any change in our expectations or in occasions, situations or circumstances on which any such statements could also be primarily based, or that will have an effect on the chance that precise outcomes will differ from these set forth in these ahead wanting statements besides as required by Nationwide Instrument 51-102. The contents of any web site, RSS feed or twitter account referenced on this press launch are usually not integrated by reference herein.

Contact Data
Investor Relations
Westport Fuel Systems
T: +1 604-718-2046

GAAP and NON-GAAP FINANCIAL MEASURES

Administration critiques the operational progress of its enterprise models and funding applications over successive durations by the evaluation of gross margin, gross margin as a share of income, web revenue, EBITDA and Adjusted EBITDA. The Firm defines gross margin as income much less price of income. The Firm defines EBITDA as web revenue or loss from persevering with operations earlier than revenue taxes adjusted for curiosity expense (web), depreciation and amortization. Westport Fuel Systems defines Adjusted EBITDA as EBITDA from persevering with operations excluding bills for stock-based compensation, unrealized international trade achieve or loss, and non-cash and different changes. Administration makes use of Adjusted EBITDA as a long-term indicator of operational efficiency because it ties carefully to the enterprise models’ capability to generate sustained money stream and such data is probably not applicable for different functions.  Adjusted EBITDA contains the corporate’s share of revenue from joint ventures.

The phrases gross margin, gross margin as a share of income, EBITDA and Adjusted EBITDA are usually not outlined beneath U.S. usually accepted accounting rules (” U.S. GAAP “) and are usually not a measure of working revenue, working efficiency or liquidity introduced in accordance with U.S. GAAP. EBITDA and Adjusted EBITDA have limitations as an analytical software, and when assessing the corporate’s working efficiency, traders mustn’t think about EBITDA and Adjusted EBITDA in isolation, or as an alternative to web loss or different consolidated assertion of operations information ready in accordance with U.S. GAAP. Amongst different issues, EBITDA and Adjusted EBITDA don’t mirror the corporate’s precise money expenditures. Different firms could calculate comparable measures in another way than Westport Fuel Systems, limiting their usefulness as comparative instruments. The corporate compensates for these limitations by relying totally on its U.S. GAAP outcomes and utilizing EBITDA and Adjusted EBITDA as supplemental data.