By Toronto-listed shares of Lion Electric experienced a significant decline in early morning trading on Thursday, in response to the company’s announcement of a wider loss and upcoming temporary layoffs.
Trading Update
The shares were down by 8.8% at 2.08 Canadian dollars ($1.53). The company revealed plans to lay off approximately 100 employees, mostly night shift production workers at its Saint-Jerome manufacturing facility. This decision aims to align with lower vehicle production and deliveries, in an effort to streamline the cost structure.
Challenges and Impact
Lion Electric has encountered obstacles, including delays in securing government subsidies and incentives, which have hindered scheduled deliveries and sales operations. The fourth quarter results showed a substantial increase in loss, totaling $56.5 million or 25 cents per share, compared to the previous year’s loss of $4.64 million or 2 cents per share. This surge is primarily attributed to an inventory write-down, an impairment charge, and escalated costs.
Financial Performance
Despite the challenges, revenue saw a positive growth from $46.8 million to $60.4 million, with an additional 14 vehicles delivered, bringing the total to 188 vehicles for the quarter.
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