Westport Reports First Quarter Financial Results



    VANCOUVER, Aug. 6 /CNW/ - Westport Innovations Inc.
(TSX:WPT/NASDAQ:  WPRT), a global leader in alternative fuel, low-emissions
transportation technologies, today reported financial results for the first
quarter of fiscal 2010 ended June 30, 2009, and provided an update on
operations.
    "During the quarter the two global leaders in truck production, Daimler
and Volvo, each launched new factory-built natural gas trucks into the North
American market using CWI engines, both the US House of Representatives and
the Senate introduced major long term incentives for heavy-duty natural gas
vehicles, and oil prices continued to rise in the quarter at the fastest rate
in history. All of these factors suggest continued strong opportunities for
Westport and our partners over the coming months," said David Demers,
Westport's CEO.
    "That said, we continue to see dramatic impact of the economic slowdown
in our markets around the world, with significant shifts in product mix and
order rates. This is due to macro factors such as the overall goods movement
activity, access to credit - both cost and timeliness - and the influence of
potential stimulus programs and the tendency to wait for potential tax
credits. The San Pedro Bay Ports are moving ahead now with 2009 procurements,
with a goal of hundreds of trucks with either our CWI engines or the Westport
HD 15-litre GX engine. In addition, we are seeing significant interest in
large private fleets as a result of the concern raised about oil price
volatility, future emissions regulations, and the significant economic
benefits of natural gas. We have directed resources to capitalize on the
shifting market opportunities and remain confident that we are on track on our
path to profitability and leadership of this growing market."

    
    First Quarter Financial and Business Highlights

        -  Reported consolidated revenues of $24.9 million for the quarter
           ended June 30th compared to $25.5 million for the same period last
           year, a decrease of 2.4%. On a U.S. dollar basis, revenue
           decreased by 13.6% as the Canadian dollar strengthened relative to
           the U.S. dollar quarter over quarter.
        -  Reported net loss of $9.2 million ($0.29 loss per share) for the
           period ending June 30, 2009 compared to a net loss of $3.5 million
           ($0.13 loss per share) for the same period last year.
        -  Reported a cash and short term investments balance as at June 30,
           2009 of $63.5 million compared to $82.6 million as at March 31,
           2009.
        -  Cummins Westport (CWI) reported an ISL G in-use emissions test
           performed on an urban transit bus recorded emissions significantly
           lower than the 2010 EPA and California Air Resources Board (CARB)
           Heavy Duty emission regulations.
        -  Cummins Westport appointed Roe East as President.
        -  Daimler Trucks North America announced it will offer the CWI ISL G
           natural gas engine in the Freightliner Business Class(R) M2 112
           truck in a total of six LNG and CNG tractor/truck configurations.
        -  Mack Trucks, a division of Volvo, announced that it will offer the
           CWI ISL G natural gas engine in their North American refuse
           trucks.
        -  Westport was named one of Canada's "50 Most Socially Responsible
           Corporations" in a joint Jantzi Research-Maclean's magazine
           report.
    

    First Quarter Fiscal Year 2010 Financial Results in Detail Westport's
consolidated revenue for the three months ended June 30, 2009 was $24.9
million compared to $25.5 million for the three months ended June 30, 2008.
CWI accounted for $23.4 million with unit shipments of 608 this quarter, down
from 1,077 for the same quarter last year. This reduction in revenue was
primarily the result of reduced demand for CWI engines in the Americas for
goods movement and refuse truck markets. Non-CWI revenues accounted for $1.5
million with 14 Westport HD LNG systems shipped in the quarter compared to 1
HD LNG system shipped same period last year.
    Westport reported a net loss of $9.2 million for the three months ended
June 30, 2009 ($0.29 loss per share), compared to a net loss of $3.5 million
($0.13 loss per share) in the same period in fiscal 2008. Operating results
for the period ended June 30, 2008 included a gain on sale of Clean Energy
shares of $2.8 million, net of taxes. Excluding the net gain on sale in the
prior period, the increase in net loss for the current period compared to the
prior period was $2.9 million.
    Westport's 50% share of CWI's net income decreased $0.9 million from $1.6
million in the prior period to $0.7 million in the current period. The
decrease in CWI net income was mainly due to a reduction in CWI's gross margin
of $2.1 million from $8.2 million to $6.1 million as a result of lower sales
volume and a decline in gross margin percentage from 33% to 26%. The gross
margin declined primarily due to higher warranty accruals associated mainly
with the ISL G engine. Non-CWI operating expenses (research and development,
general and administrative and sales and marketing) were up $1.2 million in Q1
2010 versus Q109 primarily due to higher costs relating to customer support
and market activities, an increase in stock based compensation, reduction in
program funding and other public company related expenditures. The Company
also recorded interest and accretion expense of $0.7 million on debenture
notes issued in July, 2008.
    Westport's cash and cash equivalents balance as at June 30, 2009 totalled
$63.5 million compared to $82.6 million on March 31, 2009. For the three
months ended June 30, 2009, cash flows used in operations were $14.3 million
compared to $5.0 million in the three months ended June 30, 2008 due primarily
to the timing of payments. Included in the reported decrease in cash and cash
equivalents is an advance to Cummins by CWI of $2.1 million during the quarter
and the Company repaid $0.3 million on the demand instalment loan.
Additionally, Westport incurred foreign exchange losses on U.S. dollar
denominated cash as the foreign exchange rate moved by 8% from March 31, 2009
to June 30, 2009 resulting in a negative impact on cash and cash equivalents
of approximately $2.5 million.

    Organizational Changes

    The current economic conditions, while challenging, represent a strategic
window to help position Westport's operations for future growth prospects.
Accordingly, Westport's Chief Financial Officer, Elaine Wong, will be changing
her role to focus on strategic development activities to accelerate the
Company's drive to profitability. Ms. Wong will remain CFO while Westport
recruits a new CFO.
    Cummins Westport Inc. (CWI) Business Unit Highlights In response to the
growing need for low-emission alternative fuel vehicles, international truck
brands are launching natural gas trucks featuring CWI engines. Specifically,
Daimler Trucks North America (DTNA) announced it will offer six configurations
of the Freightliner brand M2 112 with the Cummins Westport ISL G engine. These
will use either LNG or CNG storage.
    Furthermore, Mack Trucks, Inc. announced the availability of natural
gas-powered engines for refuse applications. The MACK(R) TerraPro(TM) Low
Entry model is now available for order with heavy-duty natural gas engines
supplied by Cummins Westport.

    Westport Global Heavy Duty Business Unit Highlights

    Revenue for the heavy duty business has increased to $1.5 million on 14
Westport HD LNG systems shipped, which compares to $0.4 million in the prior
year with 1 LNG system shipped. The Port of Long Beach (POLB) subsequent to
quarter end announced the results of its lottery system to award funding
towards the purchase of new clean trucks. Funding for 100 trucks was awarded
in which 96 out of 100 were natural gas. While the majority of natural gas
trucks were based on CWI engines, an additional proposal for the funding of
clean trucks at the port is underway and being administered by the Air Quality
Management District (AQMD) which may include a greater number of Westport
HD-based trucks. The AQMD and Ports have publicly stated their goal to get 500
natural gas trucks on the road before year end.

    Results Conference Call

    To coincide with the disclosure, Westport has scheduled a conference call
for Thursday, August 6, 2009 at 2:00 pm Pacific Time (5:00 pm Eastern Time).
The public is invited to listen to the conference call in real time or by
replay. To access the conference call by telephone, please dial: 866-226-1792
(North America Toll-Free) or 416-340-2216. To access the replay after the
call, please dial 800-408-3053 or 416-695-5800 using the passcode No.5548115.
The replay will be available until August 20, 2009, however, the webcast will
be archived on Westport's website. The webcast of the conference call can be
accessed on the Westport website at www.westport.com by selecting "Investors"
and then "Investor Overview" from the main menu. Replays will be available in
streaming audio on the same website after the conclusion of the conference
call.

    To view Westport's full First Quarter FY2010 financials, please point
your browser to the following link:
http://www.westport.com/investor/financial.php.

    About Westport Innovations Inc.

    Westport Innovations Inc. is a leading global supplier of proprietary
solutions that allow engines to operate on clean-burning fuels such as
compressed natural gas (CNG), liquefied natural gas (LNG), hydrogen and
biofuels such as landfill gas. Cummins Westport Inc., Westport's joint venture
with Cummins Inc., manufactures and sells the world's broadest range of
low-emissions alternative fuel engines for commercial transportation
applications such as trucks and buses. BTIC Westport Inc., Westport's joint
venture with Beijing Tianhai Industry Co. Ltd., manufactures and sells LNG
fuel tanks for vehicles. Westport's joint venture with OMVL SpA, Juniper
Engines Inc., offers light-duty LPG engine solutions for industrial
applications such as forklifts. www.westport.com

    This document contains forward-looking statements, including statements
regarding the demand for our products, the future success of our business,
profitability, and technology strategies, investment, cash and capital
requirements, intentions of partners and potential customers, the performance
of our products, future market opportunities, our estimates and assumptions
used in our accounting policies, accruals, and financial condition. These
statements are neither promises nor guarantees, but involve known and unknown
risks and uncertainties that may cause our actual results, levels of activity,
performance or achievements to be materially different from any future
results, levels of activities, performance or achievements expressed in or
implied by these forward looking statements. These risks include risks related
to our revenue growth, operating results, industry and products, the general
economy, conditions of the capital and debt markets, governmental policies and
regulation, technology innovations, as well as other risk factors that may
affect our actual results, performance or achievements or financial position
discussed in our most recent Annual Information Form and other filings with
securities regulators. Readers should not place undue reliance on any such
forward-looking statements, which speak only as of the date they were made. We
disclaim any obligation to publicly update or revise such statements to
reflect any change in our expectations or in events, conditions or
circumstances on which any such statements may be based, or that may affect
the likelihood that actual results will differ from those set forth in the
forward looking statements except as required by National Instrument 51-102.

    
    WESTPORT INNOVATIONS INC.
    Consolidated Balance Sheets
    (Expressed in thousands of Canadian dollars)
    -------------------------------------------------------------------------
                                                      June 30,      March 31,
                                                         2009           2009
    -------------------------------------------------------------------------
                                                   (unaudited)
    Assets
    Current assets:
      Cash and cash equivalents                  $     33,089   $     39,043
      Short-term investments                           30,445         43,576
      Accounts receivable                               8,814          6,417
      Loan receivable                                  12,442         11,234
      Inventories                                      14,411         13,982
      Prepaid expenses                                  1,175          1,387
      Current portion of future
       income tax assets                                4,395          4,451
      -----------------------------------------------------------------------
                                                      104,771        120,090

    Long-term investments                               2,026          1,935

    Equipment, furniture and leasehold
     improvements, net                                  7,261          7,712

    Intellectual property, net                            396            430

    Future income tax assets                            4,853          5,337
    -------------------------------------------------------------------------
                                                 $    119,307   $    135,504
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities and Shareholders' Equity
    Current liabilities
      Accounts payable and accrued
       liabilities                               $      9,062   $     14,359
      Current portion of deferred
       revenue                                            753            546
      Demand instalment loan                            4,306          4,642
      Short-term debt                                   1,489          1,614
      Current portion of long-term debt                    17             17
      Current portion of warranty
       liability                                       11,427         12,222
      -----------------------------------------------------------------------
                                                       27,054         33,400

    Warranty liability                                 11,231         12,369
    Long-term debt                                     11,671         11,353
    Deferred lease inducements                            249            284
    Deferred revenue                                    4,826          4,537
    Joint Venture Partners' share of
     net assets of joint ventures                      12,260         12,603
    -------------------------------------------------------------------------
                                                       67,291         74,546
    Shareholders' equity:
      Share capital:
        Authorized:
          Unlimited common shares,
           no par value
          Unlimited preferred shares in
           series, no par value
        Issued:
          32,080,124 (2009 - 32,040,540)
           common shares                              312,149        311,855
      Other equity instruments                         12,858         12,319
      Additional paid in capital                        5,221          5,263
      Deficit                                        (281,074)      (271,885)
      Accumulated other comprehensive
       income                                           2,862          3,406
      -----------------------------------------------------------------------
                                                       52,016         60,958

    -------------------------------------------------------------------------
                                                 $    119,307   $    135,504
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    WESTPORT INNOVATIONS INC.
    Consolidated Statements of Operations (unaudited)
    (Expressed in thousands of Canadian dollars, except share and per share
    amounts)

    -------------------------------------------------------------------------
                                                         Three months ended
                                                               June 30
                                                         2009           2008
    -------------------------------------------------------------------------

    Product revenue                              $     19,329   $     21,428
    Parts revenue                                       5,614          4,081
    -------------------------------------------------------------------------
                                                       24,943         25,509

    Cost of revenue and expenses:
      Cost of revenue                                  18,547         17,170
      Research and development                          6,756          7,163
      General and administrative                        2,621          1,462
      Sales and marketing                               3,787          2,595
      Foreign exchange loss (gain)                       (290)           (92)
      Depreciation and amortization                       519            376
      Bank charges, interest and other                     88            105
      -----------------------------------------------------------------------
                                                       32,028         28,779
    -------------------------------------------------------------------------

    Loss before undernoted                             (7,085)        (3,270)

    Loss from investment accounted for
     by the equity method                                (339)           (80)
    Interest on long-term debt
     and amortization of discount                        (658)             -
    Interest and other income                             125            303
    Gain on sale of investments                             -          3,813
    -------------------------------------------------------------------------

    Income (loss) before income taxes
     and Joint Venture Partners' share
     of income from joint ventures                     (7,957)           766

    Income tax recovery (expense):
      Current                                            (925)          (101)
      Future                                              270         (2,565)
      -----------------------------------------------------------------------
                                                         (655)        (2,666)
    -------------------------------------------------------------------------

    Net loss before Joint Venture
     Partners' share of income from
     joint ventures                                    (8,612)        (1,900)

    Joint Venture Partners' share of
     net income from joint ventures                      (577)        (1,564)

    -------------------------------------------------------------------------
    Net loss for the period                      $     (9,189)  $     (3,464)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Loss per share:
      Basic                                      $      (0.29)  $      (0.13)
      Diluted                                    $      (0.29)  $      (0.13)

    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    Weighted average common shares
     outstanding:
      Basic                                        32,049,294     27,443,257

      Diluted                                      32,049,294     27,443,257
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    WESTPORT INNOVATIONS INC.
    Consolidated Statements of Comprehensive Income (Loss) (unaudited)
    (Expressed in thousands of Canadian dollars)

    -------------------------------------------------------------------------
                                                         Three months ended
                                                               June 30
                                                         2009           2008
    -------------------------------------------------------------------------

    Loss for the period                          $     (9,189)  $     (3,464)
    Other comprehensive income (loss)
      Unrealized gain (loss) on available
       for sale securities, net of tax
       of $54 (2008 - $338)                               376         (1,717)
      Reclassification of net realized
       gains on available for sale
       securities to net loss, net of
       tax of $Nil (2008 - $676)                            -         (3,137)
       Cumulative translation adjustment                 (920)           (77)
       ----------------------------------------------------------------------
                                                         (544)        (4,931)
    -------------------------------------------------------------------------

    Comprehensive loss                           $     (9,733)  $     (8,395)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    WESTPORT INNOVATIONS INC.
    Consolidated Statements of Shareholders' Equity  (continued)
    (Expressed in thousands of Canadian dollars, except share amounts)

    Year ended March 31, 2009 (audited) and for the three months ended
    June 30, 2009 (unaudited)

    -------------------------------------------------------------------------
                                            Addit-            Accumu-
                                            ional              lated
                                     Other   paid              other  Total
                                    equity     in    Accumu-  compre- share-
                   Common    Share  Instru-  capi-    lated  hensive holders'
                   shares  capital   ments    tal   Deficit   income  Equity
    -------------------------------------------------------------------------
    Balance,
     March
     31, 2008  27,416,993 $258,202 $ 3,079 $5,097 $(247,460) $10,878 $29,796
    Issue of
     common
     shares on
     exercise
     of stock
     options      104,669      939       -   (357)        -        -     582
    Issue of
     common
     shares on
     exercise
     of
     performance
     share
     units          3,947       23     (23)     -         -        -       -
    Issue of
     common
     shares on
     settlement
     of accrued
     interest      14,931      249       -      -         -        -     249
    Issue of
     common
     shares on
     public
     offering   4,500,000   57,348       -      -         -        -  57,348
    Share issue
     costs              -   (4,906)      -      -         -        -  (4,906)
    Value of
     warrants
     issued
     with
     long-term
     debt               -        -   3,847      -         -        -   3,847
    Value of
     warrants
     issued to
     settle
     obligation
     to issue
     warrants           -        -   4,000      -         -        -   4,000
    Financing
     costs
     incurred           -        -    (307)     -         -        -    (307)
    Stock-based
     compensation       -        -   1,723    523         -        -   2,246
    Net loss for
     the period         -        -       -      -   (24,425)       - (24,425)
    Other
     comprehensive
     loss               -        -       -      -         -   (7,472) (7,472)
    -------------------------------------------------------------------------

    Balance,
     March
     31, 2009  32,040,540  311,855  12,319  5,263  (271,885)   3,406  60,958
    Issue of
     common
     shares on
     exercise
     of stock
     options       39,584      294       -   (108)        -        -     186
    Stock-based
     compensation       -        -     539     66         -        -     605
    Net loss
     for the
     period             -        -       -      -    (9,189)       -  (9,189)
    Other
     comprehensive
     income             -        -       -      -         -     (544)   (544)
    -------------------------------------------------------------------------

    Balance
     June
     30, 2009
    (un-
     audited)  32,080,124 $312,149 $12,858 $5,221 $(281,074)  $2,862 $52,016
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Westport Innovations Inc.
    Notes to Consolidated Financial Statements (unaudited)
    (Expressed in thousands of Canadian dollars except share and per share
    amounts)

    Three months ended June 30, 2009 and 2008

    -------------------------------------------------------------------------

    WESTPORT INNOVATIONS INC.
    Consolidated Statements of Cash Flows (unaudited)
    (Expressed in thousands of Canadian dollars)

    -------------------------------------------------------------------------
                                                         Three months ended
                                                               June 30
                                                         2009           2008
    -------------------------------------------------------------------------
                                                   (unaudited)    (unaudited)
    Cash flows from operations:
      Loss for the period                        $     (9,189)  $     (3,464)
      Items not involving cash:
        Depreciation and amortization                     519            376
        Stock-based compensation expense                  605            231
        Future income tax recovery                       (270)         2,565
        Change in deferred lease
         inducements                                      (35)           (89)
        Gain on sale of investments                         -         (3,813)
        Joint Venture Partners' share
         of net income from joint ventures                577          1,564
        Loss from investment accounted
         for by the equity method                         339             80
        Accretion of long-term debt                       322              -
      Changes in non-cash operating
       working capital:
        Accounts receivable                            (2,488)        (1,887)
        Inventories                                      (429)        (2,654)
        Prepaid expenses                                  199            141
        Accounts payable and accrued
         liabilities                                   (5,041)          (511)
        Deferred revenue                                  764            160
        Warranty liability                               (170)         2,294
      -----------------------------------------------------------------------
                                                      (14,297)        (5,007)
    Cash flows from investments:
      Purchase of equipment, furniture
       and leasehold improvements                         (55)        (2,349)
      Sale/Maturity of short-term
       investments, net                                13,131         15,202
      Disposition of long-term investments                  -          5,220
      Investment in joint venture                           -         (1,500)
      Advances on loans receivable                     (2,053)        (1,682)
      Leasehold inducement                                  -            325
      -----------------------------------------------------------------------
                                                       11,023         15,216
    Cash flows from financing:
      Issue of demand instalment loan                       -            500
      Repayment of demand instalment loan                (336)          (397)
      Repayment of other long-term debt                    (4)           (30)
      Shares issued for cash                              186            370
      -----------------------------------------------------------------------
                                                         (154)           443
    Effect of foreign exchange on cash
     and cash equivalents                              (2,526)          (186)

    -------------------------------------------------------------------------

    Increase (decrease) in cash and
     cash equivalents                                  (5,954)        10,466

    Cash and cash equivalents,
     beginning of period                               39,043          7,560
    -------------------------------------------------------------------------
    Cash and cash equivalents,
     end of period                               $     33,089   $     18,026
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------
    

    %SEDAR: 00004375E          %CIK: 0001370416




For further information:

For further information: Inquiries: Darren Seed, Director, Investor
Relations, Westport Innovations Inc., Phone: (604) 718-2046, Email:
invest@westport.com

Organization Profile

Westport Innovations Inc.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890