Corporate Presentation March 2020 GrandeWest.com | VicinityBus.com - - PowerPoint PPT Presentation
Corporate Presentation March 2020 GrandeWest.com | VicinityBus.com - - PowerPoint PPT Presentation
Corporate Presentation March 2020 GrandeWest.com | VicinityBus.com TSX-V: BUS | OTC Pink: GWTNF Forward Looking Statements This presentation contains ''forward-looking statements'', which reflect the expectations of management regarding
TSX-V:BUS OTC:GWTNF
www.grandewest.com | www.vicinitybus.com
This presentation contains ''forward-looking statements'', which reflect the expectations of management regarding Grande West Transportation Group Inc.’s (the “Company”) future growth, results of operations, performance and business prospects and opportunities. The words ''believes'', ''anticipates'', ''plans'', ''expects'', ''intends'', ''projects'', ''estimates'' and similar expressions are intended to identify forward-looking statements. These forward-looking statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this presentation. Such forward-looking statements are based on a number of material factors and assumptions, including, but not limited in any manner to the availability of sufficient working capital to market the Company's products and provide after-sales maintenance and support services to the Company's customers, access to adequate services and supplies to operate the Company's business, economic conditions, commodity prices, foreign currency exchange rates, interest rates, access to capital and debt markets and associated costs of funds, availability of a qualified work force, and the ultimate ability to develop, manufacture and sell the Company's products on economically favourable terms. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under ''Risk Factors'' in the Company prospectus dated November 27, 2013 and which will be detailed from time to time in the Company’s interim and annual financial statements and management’s discussion and analysis of those statements, all of which are or will be available for review on SEDAR at www.sedar.com. Although the Company has attempted to identify important factors that could cause actual performance to differ materially from that described in forward-looking statements there may be
- ther factors that cause its performance not to be as anticipated. These forward-looking statements relate only to events or information as of the date on which the statements are made.
The Company neither intends nor assumes any obligation to update these forward-looking statements or information to reflect changes in assumptions or circumstances other than required by law. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those currently
- anticipated. Accordingly, readers should not place undue reliance on forward-looking statements.
Disclaimer This presentation does not form part of any offer of securities, or constitute a solicitation of any offer to purchase or subscribe for securities. The sole purpose of this presentation, in paper
- r electronic form, is strictly for information.
Forward Looking Statements
Grande West Transportation is a Canadian company that designs and engineers mid-size multi-purpose transit vehicles for public and commercial enterprises. Grande West utilizes world class manufacturing partners to produce the Best-in-Class, Purpose-Built Vicinity bus.
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Company Highlights
Pure Play Business with Focused Market Niche
- Cleansheet design approach has resulted in lower total cost of ownership vs. competitive offerings
- Vicinity bus right-sized for key service niche to optimize operational performance
- Outright leader in purpose-built heavy duty mid-sized bus offering in the market
Demonstrated Market Acceptance
- Has achieved ~90% market share in core product market in Canada with growing pipeline in the U.S.
- Established relationships with transit authorities
- Best-in-class U.S. Federal Transit Agency (“FTA”) Altoona test results
Substantial Upside from U.S. Market Opportunity
- Manufacturing and distribution partnerships now in place to support aggressive growth agenda
- Buy America compliance has been achieved
- Provides long runway for growth representing large pipeline of opportunity
Unrivaled Flexible and Scalable Operating Platform
- Unparalleled capacity to increase or decrease production with minimal overhead cost impact
- No minimum production level commitments
- World class manufacturing relationships
- Low breakeven threshold
We’re a Contract Manufacturer
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Vicinity’s Market Positioning
Larger Smaller “Cutaway” Bus
- Built on a Light Duty Truck Chassis
- No standees
- Costly to Operate
- 33% Higher Fuel Costs
- 30-40% Higher Capital Cost
- Higher Maintenance Costs
Traditional 40’ Bus
- r modified to 30’-35’
- Monocoque Frame
- Big Bus Technology
- Compact Platform
- Right-Sizing fleets
- Lower Capital Costs
- Lower Operating Costs
- Clean Diesel or CNG Powered
- Altoona Rated ‘Best-in-Class’
The Vicinity is the only purpose-built heavy duty mid-size bus in the market *The Vicinity LT 26’ & 28’ (medium duty, 8 year / 560,000kms) will be available in 2020
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www.grandewest.com | www.vicinitybus.com *Source: ARBOC Management estimates
Introducing New Products, Opening up New Markets
Vicinity LT 26’ & 28’ Vicinity Electric (2020) Demonstrated Market Acceptance ~90% Market share in Canada Vicinity 30’ model North American total annual demand 25,000 buses / year
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North American Bus Industry Snapshot
Available: Planned : Model Category Gasoline Diesel CNG Electric Vicinity 8.4m HD Vicinity 9.14m HD Vicinity 10.06m HD Vicinity 10.67m HD Vicinity LT Medium Duty 40 Ft Model 12m HD Motor Coach 10.67m Tour Bus Near-term
- pportunity
§ Adding electrification to current product mix is underway § Last stages of design for low floor Vicinity LT product
The 12m transit bus model is the next significant product introduction
LT 10.06m Electric 12m Transit 2019 2020 2021 New Model Development Schedule
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Tested for Service in North America
MANUFACTURER FAILURES MPG CLASS 1 CLASS 2 CLASS 3 CLASS 4 VICINITY
7 6.02
Competitor A
34 15 5.54
Competitor B
9 15 4.43
Competitor C 29'
20 2 4.1
Competitor D
12 6
Competitor E
31 13
Competitor F 40’
12 9
Competitor G 40’
14 4 2.97
Competitor H*(**)
4.8
Competitor I**
3 1 40 19
Competitor J
21 13
Competitor K**
32 7 4.28
* Partial test no durablity ** 10 YEAR TEST
Vicinity Scores
- Best in Class: Fuel economy
- Best in Class: Structural Durability
- Best in Class: Fewest repairs required
(only 7 minor Class 3 vs. Competitors) The US Federal Transit Authority’s (FTA) Altoona test is an internationally recognized tough testing regime, as it essentially performs 12 years and 500,000 miles of a New York City heavy duty cycle upon completion of the testing. It allows customers to measure performance and estimate life cycle costing of the vehicle.
Full test results: Vicinity Altoona Test
Altoona Test Results: Best-in-Class (30’ Diesel model)
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Business Model
- Grande West’s Vicinity bus costs significantly less, is more maneuverable, burns less fuel and emits less
harmful emissions than a regular 40 foot transit bus
- Unparalleled capacity to quickly increase or decrease production to meet customer demand with
minimal overhead cost impact
- No production facility overhead cost burden
- No minimum production level commitments
- Ability to deliver new products to market very quickly
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Vicinity Bus Deployment - Canada
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§ U.S. is the growth market opportunity for Grande West § U.S. transit is ~5x larger than Canada § Marketing is under way
NY 13 units MS 7 units CO 1 unit GA 23 units MA 11 units FL 3 units Grande West Units per Region Marketing is Under Way
Vicinity Bus Deployment - USA
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Corporate Timeline
- Grande West Founded
- BC Transit Strategic Partnership
- Vicinity 27.5’ Born
- Weichai Agreement
- CMVSS Certified
- Vicinity Prototypes Delivered
- Vicinity 27.5’
- First BC Transit Order (15)
- FMVSS Certified
- Marketing in Canada
- Vicinity 30’ Model
- Altoona Best in Class
- Large multi-year contracts
- Vicinity 35’ Model
- Alliance Bus Group Distribution
- CNG Option
- US Customers
- Buy America + US Assembly
- Profitable Operations Q2, Q3
- $100M Backlog
- $20M RBC ABL
- $54M annual revenue
2018
- Buy America Orders/Audit
- Executive/Board Changes:
- CFO, Dan Buckle
- Direct Sales Eastern Canada
- $70M annual revenue
2008 2016 2015 2013 2014 2019 2010 2017
- Spartan Motors - US Manufacturing
- USA & Can Sales Reorganized
- Medium Duty Bus Announced (LT)
- Vicinity EV Announced
- Executive Changes - Mr. Trainer CEO
- Buy America Orders increasing
2020
- USA Private Customer
Vicinity order valued $40M
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Our Partners
Spartan Motors Inc. - U.S. Manufacturing
- Specialty vehicle manufacturing and assembly
- Employs approximately 2,500 associates
- Operates facilities in Michigan, Indiana,
Pennsylvania, South Carolina, Florida, Missouri, California, Arizona, Texas, Nebraska, South Dakota. Saltillo, Mexico; and Lima, Peru.
- Nasdaq listed: SPAR
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Our Partners
Weichai - Manufacturing Partner
- Multi-Billion Dollar Company
- Over 80,000 employees internationally
- Global service, support and warranty network
- Produces over 5,000 buses / year internationally
- World’s largest HD engine manufacturer
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USA Distributor
- One of the largest U.S. retail bus resellers
- National distribution agreement
- Sales, parts and service
Our Partners
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Selected Quarterly Information Q3 (September 30, 2019)
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Transition & Focus
Recent Accomplishments
- 2017 and 2018 record revenues and deliveries
- Strong balance sheet with $14M in working capital
- Established world class manufacturing partners
- Increasing margins
- Parts and Service sales increasing
Important Milestones
- Successfully completed a mock audit for Buy America compliance
- Won U.S. public transit contracts (Georgia and Iowa)
- Received firm orders for Buy America buses (Mississippi)
- Went to direct sales model for Eastern Canada
Current and Future
- Canadian and U.S. sales focus, strengthen organization
- Vicinity LT (Crossover Vehicle) medium duty launched
- Vicinity EV (100% electric) under development
- Established world class manufacturing partners
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Management and Board of Directors
William Trainer – (Founder) CEO, President and Director 30+ years of business leadership with extensive overseas import and export experience John Wang – VP Chief of Engineering Accredited Mechanical Design Engineer and previously senior mechanical, designer and project manager Dan Buckle – CFO Experienced pubic company finance executive and former PwC audit manager James White - Director
- Mr. White has extensive experience as a corporate director for
public companies and is currently serving as Managing Partner with Baynes & White, a Toronto, Ontario based benefits and pension actuarial consulting firm. Andrew Imanse – Director Former President of Thor Industries Bus Group, grew the El Dorado bus business to $500M/year Joe Miller – Director & Chairman Global businessman with over 30 years in the construction field Christopher Strong – Director Senior executive with 30+ years experience in CEO, CFO and board roles with startups, acquisitions, IPOs, turnaround and sales. John LaGourgue – Director 20+ years in management, sales, and capital markets
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Capital Structure (as of November 28th, 2019)
Symbol TSXV: BUS / OTC Pink: GWTNF Shares Issued and Outstanding 74,530,409 Stock Options/RSU/DSU 3,909,802 Convertible Debentures 1 1,903,030 Fully Diluted 80,343,241 Insider/Founder Ownership 2 ~30%
Notes:
- 1. Unsecured $628,000, March 2020 8% coupon, 5
year, $0.33 strike
- 2. Includes management, directors and original
founding members
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