Company falls short on FY24 revenue and EPS, but reduced losses through cost cuts.
Workhorse Group Inc. saw its shares trading higher in premarket on Monday following the release of its fiscal year 2024 earnings report. The company reported a decline in sales for FY24, dropping by 49.5% year-on-year to $6.616 million, falling short of the analyst consensus estimate of $7.750 million. This decrease in sales was mainly attributed to lower W4 CC truck sales compared to the same period in the previous year.
Additionally, Workhorse reported an earnings per share (EPS) loss of $51.69, missing the analyst consensus loss estimate of $30.44. Despite the lower sales and EPS, the company managed to narrow its operational loss for the year by 30%. The total operating loss for FY24 reduced to $73.88 million from $105.3 million in the previous year.
One of the key drivers behind the reduction in expenses was the decline in selling, general, and administrative expenses for the full year 2024, amounting to $42.5 million, down by $13.1 million compared to $55.6 million in 2023. This decrease was primarily due to a $8.2 million drop in employee compensation and related expenses resulting from a lower headcount within the company.
As of December 31, 2024, Workhorse held $4.64 million in cash and equivalents, showing that the company’s financial position remains stable despite the operational challenges faced during the fiscal year. CFO Bob Ginnan highlighted the efforts made by the company to reduce costs throughout 2024 in order to lower the operational cash burn. He also mentioned the execution of a financing arrangement with an institutional investor to provide near-term liquidity to navigate through a weaker-than-expected demand environment.
Ginnan emphasized the company’s commitment to seeking additional opportunities to reduce costs and cash use moving forward to ensure that Workhorse can achieve its strategic goals efficiently. The focus on cost reduction and financial stability is crucial for the company amidst the changing market conditions and challenges faced in the industry.
In premarket trading on Monday, Workhorse Group Inc. shares were up by 10.8% to $2.149, indicating a positive market reaction to the fiscal year 2024 earnings report. The company’s ability to navigate through a tough year and focus on improving its financial position is a positive sign for investors and stakeholders.
Overall, Workhorse Group Inc.’s performance in FY24, despite missing sales and EPS estimates, shows resilience and a strategic outlook towards financial sustainability and growth in the future. The company’s efforts to control costs and manage cash flow effectively position it well for future opportunities and challenges in the market.