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WESTPORT FUEL SYSTEMS INC.
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|
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By:
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/s/ Richard Orazietti
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Name:
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Richard Orazietti
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Title:
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Chief Financial Officer
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Management's Discussion and Analysis
|
|
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Management's Discussion and Analysis
|
•
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Independent aftermarket (“IAM”): We sell systems and components across a wide range of brands primarily through a global network of distributors that consumers can purchase and have installed onto their vehicles to use LPG or CNG fuels in addition to gasoline.
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•
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DOEM: We directly or indirectly convert new passenger cars for OEMs or importers, to address local market needs when a global LPG or CNG bi-fuel vehicle platform is not available directly from the OEM.
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•
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Light-duty OEM: We sell systems and components to OEMs that are used to manufacture new, direct off the assembly line LPG or CNG-fueled vehicles.
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•
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Heavy-duty OEM: We sell systems and components, including HPDI products, to engine OEMs and commercial vehicle OEMs. Our fully integrated Westport HPDI 2.0TM system, powered primarily by liquefied natural gas, matches the power, torque, and fuel economy benefits found in traditional compression ignition engines using only diesel fuel, resulting in reduced greenhouse gas emissions and the capability to cost-effectively run on renewable fuels.
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•
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Electronics: We design, industrialize and assemble electronic control modules.
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•
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Hydrogen: We design, develop, produce and sell hydrogen components for transportation and industrial applications. Also, we are adapting our HPDI system to use hydrogen or hydrogen/natural gas blends.
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Management's Discussion and Analysis
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•
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On March 25, 2020, $6.0 million in principal deferrals on our term loan from Export Development Canada ("EDC");
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•
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On May 28, 2020, a €5.0 million government backed term loan from UniCredit S.p.A. ("UniCredit") to our Emer S.p.A. ("Emer") subsidiary;
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•
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On July 17, 2020, a €15.0 million government backed term loan from UniCredit to our MTM S.r.l. ("MTM") subsidiary;
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•
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On July 23, 2020, a $10.0 million bridge loan secured from EDC at a 6.25% interest rate;
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•
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On July 24, 2020, we announced the refinancing of our convertible notes with Cartesian Capital Group and its affiliates ("Cartesian"). Under the terms of the agreement, we agreed to pay down the principal amount of the existing convertible notes from $17.5 million to $10.0 million. Concurrent with such repayment, the maturity of the remaining amended notes was extended to three years from the date of the amendments, the coupon rate was reduced from 9.0% annually to 6.5% annually, and the conversion price was revised from $2.17 per share to $1.42 per share.
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Management's Discussion and Analysis
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(a)
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At June 30, 2020 we have three significant debt and royalty obligations combining to approximately $18.8 million coming due in the next twelve months, as follows:
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Management's Discussion and Analysis
|
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Management's Discussion and Analysis
|
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Management's Discussion and Analysis
|
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Three months ended June 30,
|
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Six months ended June 30,
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||||||||||
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2020
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2019
|
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2020
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|
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2019
|
|
||||
(expressed in millions of US dollars, except for per share amounts and shares outstanding)
|
||||||||||||||||
Revenue
|
|
$
|
36.0
|
|
|
$
|
82.4
|
|
|
$
|
103.2
|
|
|
$
|
155.6
|
|
Gross margin
|
|
$
|
12.2
|
|
|
$
|
19.3
|
|
|
$
|
16.5
|
|
|
$
|
36.5
|
|
Gross margin %
|
|
33.9
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%
|
|
23.4
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%
|
|
16.0
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%
|
|
23.5
|
%
|
||||
Net income (loss) from continuing operations
|
|
$
|
3.0
|
|
|
$
|
(2.3
|
)
|
|
$
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(12.3
|
)
|
|
$
|
(5.4
|
)
|
Net loss from discontinued operations
|
|
$
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—
|
|
|
$
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(0.2
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)
|
|
$
|
—
|
|
|
$
|
(0.2
|
)
|
Net income (loss)
|
|
$
|
3.0
|
|
|
$
|
(2.6
|
)
|
|
$
|
(12.3
|
)
|
|
$
|
(5.6
|
)
|
Net income (loss) per share - basic and diluted
|
|
$
|
0.02
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.04
|
)
|
Weighted average basic shares outstanding
|
|
136,564,290
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133,600,880
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136,496,757
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133,525,464
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||||
Weighted average diluted shares outstanding
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|
146,323,733
|
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|
133,600,880
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136,496,757
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133,525,464
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June 30, 2020
|
|
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December 31, 2019
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(expressed in millions of United States dollars)
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|
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||||
Cash and short-term investments
|
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$
|
28.9
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$
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46.0
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Total assets
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262.7
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279.9
|
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||
Long-term debt, including current portion
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55.3
|
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48.9
|
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Royalty payable, including current portion
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13.7
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18.2
|
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Total liabilities
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185.0
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190.6
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Shareholders' equity
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77.8
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|
|
89.4
|
|
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Management's Discussion and Analysis
|
|
Three months ended June 30,
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|
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Change
|
|
Six months ended June 30,
|
|
|
Change
|
||||||||||||||||||||
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
|
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
|||||||||
OEM
|
$
|
19.1
|
|
|
$
|
44.8
|
|
|
$
|
(25.7
|
)
|
|
(57
|
)%
|
|
$
|
53.4
|
|
|
$
|
83.9
|
|
|
$
|
(30.5
|
)
|
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(36
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)%
|
IAM
|
16.9
|
|
|
37.6
|
|
|
(20.7
|
)
|
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(55
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)%
|
|
49.8
|
|
|
71.7
|
|
|
(21.9
|
)
|
|
(31
|
)%
|
||||||
Total Revenue
|
$
|
36.0
|
|
|
$
|
82.4
|
|
|
$
|
(46.4
|
)
|
|
(56
|
)%
|
|
$
|
103.2
|
|
|
$
|
155.6
|
|
|
$
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(52.4
|
)
|
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(34
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)%
|
|
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Management's Discussion and Analysis
|
|
|
Three months ended June 30,
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% of
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Three months ended June 30,
|
|
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% of
|
|
Change
|
|||||||||
|
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2020
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|
|
Revenue
|
|
2019
|
|
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Revenue
|
|
$
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|
%
|
|||||||
OEM
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|
$
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9.2
|
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|
48
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%
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|
$
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8.9
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|
|
20
|
%
|
|
$
|
0.3
|
|
|
3
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%
|
IAM
|
|
3.0
|
|
|
18
|
%
|
|
10.4
|
|
|
28
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%
|
|
(7.4
|
)
|
|
(71
|
)%
|
|||
Total gross margin
|
|
$
|
12.2
|
|
|
34
|
%
|
|
$
|
19.3
|
|
|
23
|
%
|
|
$
|
(7.1
|
)
|
|
(37
|
)%
|
|
|
Six months ended June 30, 2020
|
|
|
% of Revenue
|
|
Six months ended June 30, 2019
|
|
|
% of Revenue
|
|
Change
|
|||||||||
|
|
|
|
|
|
$
|
|
%
|
|||||||||||||
OEM
|
|
$
|
3.1
|
|
|
6
|
%
|
|
$
|
16.4
|
|
|
20
|
%
|
|
$
|
(13.3
|
)
|
|
(81
|
)%
|
IAM
|
|
13.4
|
|
|
27
|
%
|
|
20.1
|
|
|
28
|
%
|
|
(6.7
|
)
|
|
(33
|
)%
|
|||
Total gross margin
|
|
$
|
16.5
|
|
|
16
|
%
|
|
$
|
36.5
|
|
|
23
|
%
|
|
$
|
(20.0
|
)
|
|
(55
|
)%
|
|
|
Management's Discussion and Analysis
|
|
|
Three months ended June 30,
|
|
|
Change
|
|
Six months ended June 30,
|
|
|
Change
|
||||||||||||||||||||
|
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
|
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
|||||||||
OEM
|
|
$
|
3.2
|
|
|
$
|
4.8
|
|
|
$
|
(1.6
|
)
|
|
(33
|
)%
|
|
$
|
7.6
|
|
|
$
|
9.1
|
|
|
$
|
(1.5
|
)
|
|
(16
|
)%
|
IAM
|
|
0.9
|
|
|
2.0
|
|
|
(1.1
|
)
|
|
(55
|
)%
|
|
2.2
|
|
|
4.3
|
|
|
(2.1
|
)
|
|
(49
|
)%
|
||||||
Corporate
|
|
—
|
|
|
0.1
|
|
|
(0.1
|
)
|
|
(100
|
)%
|
|
0.1
|
|
|
0.3
|
|
|
(0.2
|
)
|
|
(67
|
)%
|
||||||
Total R&D expenses
|
|
$
|
4.1
|
|
|
$
|
6.9
|
|
|
$
|
(2.8
|
)
|
|
(41
|
)%
|
|
$
|
9.9
|
|
|
$
|
13.7
|
|
|
$
|
(3.8
|
)
|
|
(28
|
)%
|
|
|
Management's Discussion and Analysis
|
|
|
Three months ended June 30,
|
|
|
Change
|
|
Six months ended June 30,
|
|
|
Change
|
||||||||||||||||||||
|
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
|
2020
|
|
|
2019
|
|
|
$
|
|
%
|
||||||||||
OEM
|
|
$
|
3.6
|
|
|
$
|
5.7
|
|
|
$
|
(2.1
|
)
|
|
(37
|
)%
|
|
$
|
6.9
|
|
|
$
|
10.2
|
|
|
$
|
(3.3
|
)
|
|
(32
|
)%
|
IAM
|
|
3.0
|
|
|
4.4
|
|
|
(1.4
|
)
|
|
(32
|
)%
|
|
6.5
|
|
|
8.6
|
|
|
(2.1
|
)
|
|
(24
|
)%
|
||||||
Corporate
|
|
1.9
|
|
|
6.9
|
|
|
(5.0
|
)
|
|
(72
|
)%
|
|
5.0
|
|
|
14.0
|
|
|
(9.0
|
)
|
|
(64
|
)%
|
||||||
Total SG&A expenses
|
|
$
|
8.5
|
|
|
$
|
17.0
|
|
|
$
|
(8.5
|
)
|
|
(50
|
)%
|
|
$
|
18.4
|
|
|
$
|
32.8
|
|
|
$
|
(14.4
|
)
|
|
(44
|
)%
|
|
|
Management's Discussion and Analysis
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Total revenue
|
|
$
|
66.4
|
|
|
$
|
84.0
|
|
|
$
|
143.1
|
|
|
$
|
176.3
|
|
Gross margin
|
|
$
|
18.2
|
|
|
$
|
25.2
|
|
|
$
|
39.8
|
|
|
$
|
53.1
|
|
Gross margin %
|
|
27.4
|
%
|
|
30.0
|
%
|
|
27.8
|
%
|
|
30.1
|
%
|
||||
Net income before income taxes
|
|
$
|
11.0
|
|
|
$
|
16.0
|
|
|
$
|
24.9
|
|
|
$
|
36.5
|
|
Net income attributable to the Company
|
|
$
|
4.2
|
|
|
$
|
5.9
|
|
|
$
|
9.5
|
|
|
$
|
14.5
|
|
|
|
Management's Discussion and Analysis
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Interest expense on long-term debt
|
|
$
|
0.8
|
|
|
$
|
0.8
|
|
|
$
|
1.6
|
|
|
$
|
1.9
|
|
Royalty payable accretion expense
|
|
0.7
|
|
|
1.0
|
|
|
1.4
|
|
|
1.8
|
|
||||
Total interest on long-term debt and accretion on royalty payable
|
|
$
|
1.5
|
|
|
$
|
1.8
|
|
|
$
|
3.0
|
|
|
$
|
3.7
|
|
|
|
Management's Discussion and Analysis
|
|
|
Management's Discussion and Analysis
|
|
|
Carrying amount
|
|
Contractual cash flows
|
|
< 1 year
|
|
1 - 3 years
|
|
4-5 years
|
|
> 5 years
|
||||||||||||
Accounts payable and accrued liabilities
|
|
$
|
71.2
|
|
|
$
|
71.2
|
|
|
$
|
71.2
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Long-term debt, principal, (1)
|
|
55.3
|
|
|
55.3
|
|
|
20.9
|
|
|
29.8
|
|
|
4.4
|
|
|
0.2
|
|
||||||
Long-term debt, interest (1)
|
|
—
|
|
|
5.2
|
|
|
2.6
|
|
|
2.6
|
|
|
—
|
|
|
—
|
|
||||||
Long-term royalty payable (2)
|
|
13.7
|
|
|
20.3
|
|
|
7.3
|
|
|
6.3
|
|
|
3.9
|
|
|
2.8
|
|
||||||
Operating lease obligations (3)
|
|
15.4
|
|
|
17.6
|
|
|
2.0
|
|
|
7.3
|
|
|
4.5
|
|
|
3.8
|
|
||||||
|
|
$
|
155.6
|
|
|
$
|
169.6
|
|
|
$
|
104.0
|
|
|
$
|
46.0
|
|
|
$
|
12.8
|
|
|
$
|
6.8
|
|
|
|
June 30, 2020
|
|
|
August 6, 2020
|
|
|
|
Number
|
|
|
Number
|
|
|
|
|
|
|
|
|
Common Shares outstanding
|
|
136,757,404
|
|
|
136,857,012
|
|
Share Units
|
|
|
|
|
|
|
Outstanding
|
|
1,694,927
|
|
|
1,595,319
|
|
Exercisable
|
|
99,608
|
|
|
—
|
|
|
|
Management's Discussion and Analysis
|
|
|
Management's Discussion and Analysis
|
Three months ended
|
|
30-Sep-18
|
|
31-Dec-18
|
|
31-Mar-19
|
|
30-Jun-19
|
|
30-Sep-19
|
|
31-Dec-19
|
|
31-Mar-20
|
|
30-Jun-20
|
||||||||||||||||
(expressed in millions of United States dollars except for per share amounts)
|
|
(1)
|
|
|
|
|
|
|
|
|
|
|
|
(2)
|
|
(3)
|
||||||||||||||||
Total revenue
|
|
$
|
65.5
|
|
|
$
|
60.5
|
|
|
$
|
73.2
|
|
|
$
|
82.4
|
|
|
$
|
75.4
|
|
|
$
|
74.3
|
|
|
$
|
67.2
|
|
|
$
|
36.0
|
|
Cost of product and parts revenue
|
|
$
|
49.9
|
|
|
$
|
48.2
|
|
|
$
|
56.0
|
|
|
$
|
63.1
|
|
|
$
|
57.5
|
|
|
$
|
60.5
|
|
|
$
|
62.9
|
|
|
$
|
23.8
|
|
Gross margin
|
|
$
|
15.6
|
|
|
$
|
12.3
|
|
|
$
|
17.2
|
|
|
$
|
19.3
|
|
|
$
|
17.9
|
|
|
$
|
13.8
|
|
|
$
|
4.3
|
|
|
$
|
12.2
|
|
Gross margin percentage
|
|
23.8
|
%
|
|
20.3
|
%
|
|
23.5
|
%
|
|
23.4
|
%
|
|
23.7
|
%
|
|
18.6
|
%
|
|
6.4
|
%
|
|
33.9
|
%
|
||||||||
Net income (loss) from continuing operations
|
|
$
|
(12.1
|
)
|
|
$
|
(10.4
|
)
|
|
$
|
(3.0
|
)
|
|
$
|
(2.3
|
)
|
|
$
|
4.9
|
|
|
$
|
0.6
|
|
|
$
|
(15.3
|
)
|
|
$
|
3.0
|
|
Net income (loss)
|
|
$
|
(3.2
|
)
|
|
$
|
(9.2
|
)
|
|
$
|
(3.0
|
)
|
|
$
|
(2.6
|
)
|
|
$
|
4.9
|
|
|
$
|
0.7
|
|
|
$
|
(15.3
|
)
|
|
$
|
3.0
|
|
EBITDA (4)
|
|
$
|
(3.0
|
)
|
|
$
|
(5.3
|
)
|
|
$
|
4.2
|
|
|
$
|
4.0
|
|
|
$
|
11.7
|
|
|
$
|
5.0
|
|
|
$
|
(11.1
|
)
|
|
$
|
9.2
|
|
Adjusted EBITDA (5)
|
|
$
|
4.3
|
|
|
$
|
0.2
|
|
|
$
|
7.3
|
|
|
$
|
8.1
|
|
|
$
|
9.4
|
|
|
$
|
3.6
|
|
|
$
|
(3.6
|
)
|
|
$
|
6.2
|
|
Euro to U.S. dollar average exchange rate
|
|
1.16
|
|
|
1.14
|
|
|
1.14
|
|
1.12
|
|
|
1.11
|
|
|
1.11
|
|
|
1.10
|
|
|
1.10
|
|
|||||||||
Canadian dollar to U.S. dollar average exchange rate
|
|
0.77
|
|
|
0.76
|
|
|
0.75
|
|
0.75
|
|
|
0.76
|
|
|
0.76
|
|
|
0.74
|
|
|
0.72
|
|
|||||||||
Earnings (loss) per share
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Basic and diluted from continuing operations
|
|
$
|
(0.09
|
)
|
|
$
|
(0.08
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
0.04
|
|
|
$
|
0.00
|
|
|
$
|
(0.11
|
)
|
|
$
|
0.02
|
|
Basic and diluted
|
|
$
|
(0.02
|
)
|
|
$
|
(0.07
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
(0.02
|
)
|
|
$
|
0.04
|
|
|
$
|
0.00
|
|
|
$
|
(0.11
|
)
|
|
$
|
0.02
|
|
CWI net income attributable to the Company
|
|
$
|
7.7
|
|
|
$
|
5.7
|
|
|
$
|
8.6
|
|
|
$
|
5.9
|
|
|
$
|
5.4
|
|
|
$
|
6.7
|
|
|
$
|
5.3
|
|
|
$
|
4.2
|
|
|
|
Management's Discussion and Analysis
|
Three months ended
|
|
30-Sep-18
|
|
|
31-Dec-18
|
|
|
31-Mar-19
|
|
|
30-Jun-19
|
|
|
30-Sep-19
|
|
|
31-Dec-19
|
|
|
31-Mar-20
|
|
|
30-Jun-20
|
|
||||||||
Income (loss) before income taxes from continuing operations
|
|
$
|
(9.5
|
)
|
|
$
|
(11.9
|
)
|
|
$
|
(1.9
|
)
|
|
$
|
(1.4
|
)
|
|
$
|
5.7
|
|
|
$
|
(0.3
|
)
|
|
$
|
(16.0
|
)
|
|
$
|
4.6
|
|
Interest expense, net (1)
|
|
2.3
|
|
|
2.6
|
|
|
1.8
|
|
|
1.4
|
|
|
1.8
|
|
|
1.5
|
|
|
1.5
|
|
|
1.2
|
|
||||||||
Depreciation and amortization
|
|
4.2
|
|
|
4.0
|
|
|
4.3
|
|
|
4.0
|
|
|
4.2
|
|
|
3.8
|
|
|
3.4
|
|
|
3.4
|
|
||||||||
EBITDA
|
|
$
|
(3.0
|
)
|
|
$
|
(5.3
|
)
|
|
$
|
4.2
|
|
|
$
|
4.0
|
|
|
$
|
11.7
|
|
|
$
|
5.0
|
|
|
$
|
(11.1
|
)
|
|
$
|
9.2
|
|
|
|
Management's Discussion and Analysis
|
Three months ended
|
30-Sep-18
|
|
|
31-Dec-18
|
|
|
31-Mar-19
|
|
|
30-Jun-19
|
|
|
30-Sep-19
|
|
|
31-Dec-19
|
|
|
31-Mar-20
|
|
|
30-Jun-20
|
|
||||||||
EBITDA
|
$
|
(3.0
|
)
|
|
$
|
(5.3
|
)
|
|
$
|
4.2
|
|
|
$
|
4.0
|
|
|
$
|
11.7
|
|
|
$
|
5.0
|
|
|
$
|
(11.1
|
)
|
|
$
|
9.2
|
|
Stock based compensation
|
0.6
|
|
|
0.7
|
|
|
0.4
|
|
|
0.3
|
|
|
0.3
|
|
|
0.5
|
|
|
0.6
|
|
|
0.6
|
|
||||||||
Unrealized foreign exchange (gain) loss
|
2.2
|
|
|
1.6
|
|
|
0.1
|
|
|
(0.7
|
)
|
|
0.7
|
|
|
(2.6
|
)
|
|
6.9
|
|
|
(3.6
|
)
|
||||||||
Intangible impairment
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
0.7
|
|
|
—
|
|
|
—
|
|
||||||||
Asset impairment
|
—
|
|
|
0.6
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Restructuring, termination and other exit costs
|
—
|
|
|
—
|
|
|
0.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Legal costs associated with SEC investigation
|
3.5
|
|
|
3.1
|
|
|
1.8
|
|
|
4.5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Other
|
1.0
|
|
|
(0.5
|
)
|
|
—
|
|
|
—
|
|
|
(3.3
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||||
Adjusted EBITDA
|
$
|
4.3
|
|
|
$
|
0.2
|
|
|
$
|
7.3
|
|
|
$
|
8.1
|
|
|
$
|
9.4
|
|
|
$
|
3.6
|
|
|
$
|
(3.6
|
)
|
|
$
|
6.2
|
|
WESTPORT FUEL SYSTEMS INC.
|
Condensed Consolidated Interim Balance Sheets (unaudited)
|
(Expressed in thousands of United States dollars, except share amounts)
|
June 30, 2020 and December 31, 2019
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|
||
Assets
|
|
|
|
|
|
|
||
Current assets:
|
|
|
|
|
|
|
||
Cash and cash equivalents (including restricted cash, note 3(d))
|
|
$
|
28,928
|
|
|
$
|
46,012
|
|
Accounts receivable (note 6)
|
|
61,925
|
|
|
66,950
|
|
||
Inventories (note 7)
|
|
56,105
|
|
|
47,806
|
|
||
Prepaid expenses
|
|
9,056
|
|
|
7,417
|
|
||
Total current assets
|
|
156,014
|
|
|
168,185
|
|
||
Long-term investments (note 8)
|
|
10,807
|
|
|
10,587
|
|
||
Property, plant and equipment (note 9)
|
|
55,832
|
|
|
58,856
|
|
||
Operating lease right-of-use assets (note 12)
|
|
15,392
|
|
|
17,524
|
|
||
Intangible assets (note 10)
|
|
12,001
|
|
|
13,075
|
|
||
Deferred income tax assets
|
|
2,581
|
|
|
1,929
|
|
||
Goodwill
|
|
3,111
|
|
|
3,110
|
|
||
Other long-term assets
|
|
7,002
|
|
|
6,660
|
|
||
Total assets
|
|
$
|
262,740
|
|
|
$
|
279,926
|
|
Liabilities and Shareholders’ Equity
|
|
|
|
|
|
|
||
Current liabilities:
|
|
|
|
|
|
|
||
Accounts payable and accrued liabilities (note 11)
|
|
$
|
71,195
|
|
|
$
|
86,180
|
|
Current portion of operating lease liabilities (note 12)
|
|
3,864
|
|
|
4,406
|
|
||
Current portion of long-term debt (note 13 and 21)
|
|
22,270
|
|
|
13,567
|
|
||
Current portion of long-term royalty payable (note 14)
|
|
7,268
|
|
|
5,936
|
|
||
Current portion of warranty liability (note 15)
|
|
13,885
|
|
|
4,505
|
|
||
Total current liabilities
|
|
118,482
|
|
|
114,594
|
|
||
Long-term operating lease liabilities (note 12)
|
|
11,528
|
|
|
13,118
|
|
||
Long-term debt (note 13 and 21)
|
|
33,067
|
|
|
35,312
|
|
||
Long-term royalty payable (note 14)
|
|
6,439
|
|
|
12,322
|
|
||
Warranty liability (note 15)
|
|
5,159
|
|
|
4,396
|
|
||
Deferred income tax liabilities
|
|
4,349
|
|
|
4,445
|
|
||
Other long-term liabilities
|
|
5,940
|
|
|
6,380
|
|
||
Total liabilities
|
|
184,964
|
|
|
190,567
|
|
||
Shareholders’ equity:
|
|
|
|
|
|
|
||
Share capital (note 16):
|
|
|
|
|
|
|
||
Unlimited common and preferred shares, no par value
|
|
|
|
|
|
|
||
136,757,404 (2019 - 136,416,981) common shares
|
|
1,095,147
|
|
|
1,094,633
|
|
||
Other equity instruments
|
|
7,523
|
|
|
6,857
|
|
||
Additional paid in capital
|
|
10,079
|
|
|
10,079
|
|
||
Accumulated deficit
|
|
(1,010,619
|
)
|
|
(998,320
|
)
|
||
Accumulated other comprehensive loss
|
|
(24,354
|
)
|
|
(23,890
|
)
|
||
Total shareholders' equity
|
|
77,776
|
|
|
89,359
|
|
||
Total liabilities and shareholders' equity
|
|
$
|
262,740
|
|
|
$
|
279,926
|
|
Commitments and contingencies (note 18)
|
|
|
|
|
|
|
||
Subsequent events (note 21)
|
|
|
|
|
Approved on behalf of the Board:
|
Daniel M. Hancock
|
Director
|
Brenda J. Eprile
|
|
Director
|
WESTPORT FUEL SYSTEMS INC.
|
Condensed Consolidated Interim Statements of Operations and Comprehensive Income (Loss) (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Revenue
|
|
$
|
35,964
|
|
|
$
|
82,419
|
|
|
$
|
103,187
|
|
|
$
|
155,610
|
|
Cost of revenue and expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cost of revenue
|
|
23,775
|
|
|
63,091
|
|
|
86,723
|
|
|
119,127
|
|
||||
Research and development
|
|
4,090
|
|
|
6,910
|
|
|
9,890
|
|
|
13,708
|
|
||||
General and administrative
|
|
6,109
|
|
|
12,718
|
|
|
12,741
|
|
|
24,683
|
|
||||
Sales and marketing
|
|
2,378
|
|
|
4,284
|
|
|
5,703
|
|
|
8,101
|
|
||||
Restructuring costs
|
|
—
|
|
|
—
|
|
|
—
|
|
|
825
|
|
||||
Foreign exchange (gain) loss
|
|
(3,626
|
)
|
|
(705
|
)
|
|
3,269
|
|
|
(646
|
)
|
||||
Depreciation and amortization
|
|
1,511
|
|
|
2,000
|
|
|
3,007
|
|
|
4,454
|
|
||||
|
|
34,237
|
|
|
88,298
|
|
|
121,333
|
|
|
170,252
|
|
||||
Income (loss) from operations
|
|
1,727
|
|
|
(5,879
|
)
|
|
(18,146
|
)
|
|
(14,642
|
)
|
||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income from investments accounted for by the equity method
|
|
4,121
|
|
|
5,885
|
|
|
9,488
|
|
|
14,540
|
|
||||
Interest on long-term debt and accretion on royalty payable
|
|
(1,467
|
)
|
|
(1,785
|
)
|
|
(3,019
|
)
|
|
(3,702
|
)
|
||||
Interest and other income, net of bank charges
|
|
174
|
|
|
348
|
|
|
259
|
|
|
469
|
|
||||
Income (loss) before income taxes
|
|
4,555
|
|
|
(1,431
|
)
|
|
(11,418
|
)
|
|
(3,335
|
)
|
||||
Income tax expense
|
|
1,565
|
|
|
887
|
|
|
881
|
|
|
2,022
|
|
||||
Net income (loss) from continuing operations
|
|
2,990
|
|
|
(2,318
|
)
|
|
(12,299
|
)
|
|
(5,357
|
)
|
||||
Net loss from discontinued operations (note 5)
|
|
—
|
|
|
(240
|
)
|
|
—
|
|
|
(240
|
)
|
||||
Net income (loss) for the period
|
|
2,990
|
|
|
(2,558
|
)
|
|
(12,299
|
)
|
|
(5,597
|
)
|
||||
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Cumulative translation adjustment
|
|
(633
|
)
|
|
1,279
|
|
|
(464
|
)
|
|
753
|
|
||||
Comprehensive income (loss)
|
|
$
|
2,357
|
|
|
$
|
(1,279
|
)
|
|
$
|
(12,763
|
)
|
|
$
|
(4,844
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Income (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
From continuing operations - basic and diluted
|
|
$
|
0.02
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.04
|
)
|
From discontinued operations - basic and diluted
|
|
$
|
—
|
|
|
$
|
(0.00
|
)
|
|
$
|
—
|
|
|
$
|
(0.00
|
)
|
Net income (loss) per share - basic and diluted
|
|
$
|
0.02
|
|
|
$
|
(0.02
|
)
|
|
$
|
(0.09
|
)
|
|
$
|
(0.04
|
)
|
Weighted average common shares outstanding:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Basic
|
|
136,564,290
|
|
|
133,600,880
|
|
|
136,496,757
|
|
|
133,525,464
|
|
||||
Diluted
|
|
146,323,733
|
|
|
133,600,880
|
|
|
136,496,757
|
|
|
133,525,464
|
|
|
WESTPORT FUEL SYSTEMS INC.
|
Condensed Consolidated Interim Statements of Shareholders' Equity (unaudited)
|
(Expressed in thousands of United States dollars, except share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
|
Common Shares Outstanding
|
|
|
Share capital
|
|
|
Other equity instruments
|
|
|
Additional paid in capital
|
|
|
Accumulated deficit
|
|
|
Accumulated other comprehensive income (loss)
|
|
|
Total shareholders' equity
|
|
||||||
|
|
Three Months Ended June 30, 2019
|
|||||||||||||||||||||||||
April 1, 2019
|
|
133,517,924
|
|
|
$
|
1,087,420
|
|
|
$
|
12,992
|
|
|
$
|
10,079
|
|
|
$
|
(1,001,400
|
)
|
|
$
|
(21,584
|
)
|
|
$
|
87,507
|
|
Issue of common shares on exercise of share units
|
|
145,850
|
|
|
356
|
|
|
(356
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
330
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
330
|
|
||||||
Net loss for the period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(2,558
|
)
|
|
—
|
|
|
(2,558
|
)
|
||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,279
|
|
|
1,279
|
|
||||||
June 30, 2019
|
|
133,663,774
|
|
|
$
|
1,087,776
|
|
|
$
|
12,966
|
|
|
$
|
10,079
|
|
|
$
|
(1,003,958
|
)
|
|
$
|
(20,305
|
)
|
|
$
|
86,558
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Six Months Ended June 30, 2019
|
|||||||||||||||||||||||||
January 1, 2019
|
|
133,380,899
|
|
|
$
|
1,087,068
|
|
|
$
|
12,948
|
|
|
$
|
10,079
|
|
|
$
|
(998,361
|
)
|
|
$
|
(21,058
|
)
|
|
$
|
90,676
|
|
Issue of common shares on exercise of share units
|
|
282,875
|
|
|
708
|
|
|
(708
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
726
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
726
|
|
||||||
Net loss for the period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,597
|
)
|
|
—
|
|
|
(5,597
|
)
|
||||||
Other comprehensive income
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
753
|
|
|
753
|
|
||||||
June 30, 2019
|
|
133,663,774
|
|
|
$
|
1,087,776
|
|
|
$
|
12,966
|
|
|
$
|
10,079
|
|
|
$
|
(1,003,958
|
)
|
|
$
|
(20,305
|
)
|
|
$
|
86,558
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
|
|
Three Months Ended June 30, 2020
|
|||||||||||||||||||||||||
April 1, 2020
|
|
136,465,872
|
|
|
$
|
1,094,720
|
|
|
$
|
7,361
|
|
|
$
|
10,079
|
|
|
$
|
(1,013,609
|
)
|
|
$
|
(23,721
|
)
|
|
$
|
74,830
|
|
Issue of common shares on exercise of share units
|
|
291,532
|
|
|
427
|
|
|
(427
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
589
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
589
|
|
||||||
Net income for the period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,990
|
|
|
—
|
|
|
2,990
|
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(633
|
)
|
|
(633
|
)
|
||||||
June 30, 2020
|
|
136,757,404
|
|
|
$
|
1,095,147
|
|
|
$
|
7,523
|
|
|
$
|
10,079
|
|
|
$
|
(1,010,619
|
)
|
|
$
|
(24,354
|
)
|
|
$
|
77,776
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
Six Months Ended June 30, 2020
|
|||||||||||||||||||||||||
January 1, 2020
|
|
136,416,981
|
|
|
$
|
1,094,633
|
|
|
$
|
6,857
|
|
|
$
|
10,079
|
|
|
$
|
(998,320
|
)
|
|
$
|
(23,890
|
)
|
|
$
|
89,359
|
|
Issue of common shares on exercise of share units
|
|
340,423
|
|
|
514
|
|
|
(514
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Stock-based compensation
|
|
—
|
|
|
—
|
|
|
1,180
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,180
|
|
||||||
Net loss for the period
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(12,299
|
)
|
|
—
|
|
|
(12,299
|
)
|
||||||
Other comprehensive loss
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(464
|
)
|
|
(464
|
)
|
||||||
June 30, 2020
|
|
136,757,404
|
|
|
$
|
1,095,147
|
|
|
$
|
7,523
|
|
|
$
|
10,079
|
|
|
$
|
(1,010,619
|
)
|
|
$
|
(24,354
|
)
|
|
$
|
77,776
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
WESTPORT FUEL SYSTEMS INC.
|
Condensed Consolidated Interim Statements of Cash Flows (unaudited)
|
(Expressed in thousands of United States dollars)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Cash flows from (used in) operating activities:
|
|
|
|
|
|
|
|
|
|
|||||||
Net income (loss) for the period from continuing operations
|
|
$
|
2,990
|
|
|
$
|
(2,318
|
)
|
|
$
|
(12,299
|
)
|
|
$
|
(5,357
|
)
|
Items not involving cash:
|
|
|
|
|
|
|
|
|
|
|
||||||
Depreciation and amortization
|
|
3,402
|
|
|
3,963
|
|
|
6,771
|
|
|
8,293
|
|
||||
Stock-based compensation expense
|
|
617
|
|
|
330
|
|
|
1,241
|
|
|
726
|
|
||||
Unrealized foreign exchange loss (gain)
|
|
(3,626
|
)
|
|
(705
|
)
|
|
3,269
|
|
|
(646
|
)
|
||||
Deferred income tax
|
|
1,458
|
|
|
671
|
|
|
(683
|
)
|
|
671
|
|
||||
Income from investments accounted for by the equity method
|
|
(4,121
|
)
|
|
(5,885
|
)
|
|
(9,488
|
)
|
|
(14,540
|
)
|
||||
Interest on long-term debt and accretion of royalty payable
|
|
1,467
|
|
|
1,785
|
|
|
3,019
|
|
|
3,702
|
|
||||
Change in inventory write-downs to net realizable value
|
|
381
|
|
|
(166
|
)
|
|
64
|
|
|
(18
|
)
|
||||
Change in bad debt expense
|
|
214
|
|
|
192
|
|
|
252
|
|
|
579
|
|
||||
Restructuring obligations
|
|
—
|
|
|
—
|
|
|
—
|
|
|
224
|
|
||||
Net cash from (used) before working capital changes
|
|
2,782
|
|
|
(2,133
|
)
|
|
(7,854
|
)
|
|
(6,366
|
)
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Changes in non-cash operating working capital:
|
|
|
|
|
|
|
|
|
||||||||
Accounts receivable
|
|
4,042
|
|
|
(11,219
|
)
|
|
4,618
|
|
|
(23,228
|
)
|
||||
Inventories
|
|
(4,329
|
)
|
|
1,038
|
|
|
(8,056
|
)
|
|
(1,144
|
)
|
||||
Prepaid and other assets
|
|
(919
|
)
|
|
(382
|
)
|
|
(1,559
|
)
|
|
(1,877
|
)
|
||||
Accounts payable and accrued liabilities
|
|
(9,623
|
)
|
|
15,324
|
|
|
(16,820
|
)
|
|
18,061
|
|
||||
Deferred revenue
|
|
(471
|
)
|
|
24
|
|
|
1,030
|
|
|
2,359
|
|
||||
Warranty liability
|
|
(534
|
)
|
|
(188
|
)
|
|
9,781
|
|
|
(588
|
)
|
||||
Net cash from (used in) operating activities of continuing operations
|
|
(9,052
|
)
|
|
2,464
|
|
|
(18,860
|
)
|
|
(12,783
|
)
|
||||
Net cash used in operating activities of discontinued operations
|
|
—
|
|
|
(240
|
)
|
|
—
|
|
|
(240
|
)
|
||||
Cash flows from (used in) investing activities:
|
|
|
|
|
|
|
|
|
|
|
||||||
Purchase of property, plant and equipment and other assets
|
|
(1,562
|
)
|
|
(1,578
|
)
|
|
(3,186
|
)
|
|
(3,591
|
)
|
||||
Dividends received from joint ventures
|
|
3,420
|
|
|
7,381
|
|
|
9,243
|
|
|
13,371
|
|
||||
Net cash from investing activities of continuing operations
|
|
1,858
|
|
|
5,803
|
|
|
6,057
|
|
|
9,780
|
|
||||
Cash flows from (used in) financing activities:
|
|
|
|
|
|
|
|
|
|
|
||||||
Repayment of operating lines of credit and long-term facilities
|
|
(7,176
|
)
|
|
(8,170
|
)
|
|
(18,893
|
)
|
|
(13,778
|
)
|
||||
Drawings on operating lines of credit and long-term facilities
|
|
10,996
|
|
|
6,363
|
|
|
22,066
|
|
|
8,402
|
|
||||
Payment of royalty payable
|
|
(5,948
|
)
|
|
(6,034
|
)
|
|
(5,948
|
)
|
|
(6,034
|
)
|
||||
Net cash used in financing activities
|
|
(2,128
|
)
|
|
(7,841
|
)
|
|
(2,775
|
)
|
|
(11,410
|
)
|
||||
Effect of foreign exchange on cash and cash equivalents
|
|
(842
|
)
|
|
(758
|
)
|
|
(1,506
|
)
|
|
(1,076
|
)
|
||||
Decrease in cash and cash equivalents
|
|
(10,164
|
)
|
|
(572
|
)
|
|
(17,084
|
)
|
|
(15,729
|
)
|
||||
Cash and cash equivalents, beginning of period (including restricted cash)
|
|
39,092
|
|
|
45,962
|
|
|
46,012
|
|
|
61,119
|
|
||||
Cash and cash equivalents, end of period (including restricted cash)
|
|
$
|
28,928
|
|
|
$
|
45,390
|
|
|
$
|
28,928
|
|
|
$
|
45,390
|
|
WESTPORT FUEL SYSTEMS INC.
|
Condensed Consolidated Statements of Cash Flows (unaudited)
|
(Expressed in thousands of United States dollars)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Supplementary information:
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest paid
|
|
$
|
465
|
|
|
$
|
608
|
|
|
$
|
2,390
|
|
|
$
|
2,864
|
|
Taxes paid, net of refunds
|
|
167
|
|
|
280
|
|
|
(20
|
)
|
|
286
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
•
|
On March 25, 2020, $6,000 in principal deferrals on the Company's term loan with Export Development Canada ("EDC");
|
•
|
On May 28, 2020, a Euro 5,000 government backed term loan from UniCredit S.p.A. ("UniCredit") to the Company's Emer S.p.A. ("Emer") subsidiary;
|
•
|
On July 17, 2020, a Euro 15,000 government backed term loan from UniCredit to the Company's MTM S.r.l. ("MTM") subsidiary;
|
•
|
On July 23, 2020, a $10,000 bridge loan secured through EDC at a 6.25% interest rate;
|
•
|
On July 24, 2020, the Company announced the refinancing of the convertible notes with Cartesian Capital Group and its affiliates ("Cartesian"). Under the terms of the agreement, the Company agreed to pay down the principal amount of the existing convertible notes from $17,500 to $10,000. Concurrent with such repayment, the maturity of the remaining amended notes was extended to three years from the date of the amendments, the coupon rate was reduced from 9.0% annually to 6.5% annually, and the conversion price was revised from $2.17 per share to $1.42 per share.
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
(a)
|
The Company has three significant debt and royalty obligations combining to approximately $18,768 coming due in the next twelve months, as follows:
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
Period ended
|
|
Average for the three months ended
|
|
Average for the six months ended
|
||||||||||||
|
June 30, 2020
|
|
|
December 31, 2019
|
|
|
June 30, 2020
|
|
|
June 30, 2019
|
|
|
June 30, 2020
|
|
|
June 30, 2019
|
|
Canadian Dollar
|
0.73
|
|
|
0.77
|
|
|
0.72
|
|
|
0.75
|
|
|
0.73
|
|
|
0.75
|
|
Euro
|
1.12
|
|
|
1.12
|
|
|
1.10
|
|
|
1.12
|
|
|
1.10
|
|
|
1.13
|
|
Argentina Peso
|
0.01
|
|
|
0.02
|
|
|
0.01
|
|
|
0.02
|
|
|
0.02
|
|
|
0.02
|
|
RMB
|
0.14
|
|
|
0.14
|
|
|
0.14
|
|
|
0.15
|
|
|
0.14
|
|
|
0.15
|
|
Swedish Krona
|
0.11
|
|
|
0.11
|
|
|
0.10
|
|
|
0.11
|
|
|
0.10
|
|
|
0.11
|
|
Indian Rupee
|
0.0132
|
|
|
0.0140
|
|
|
0.0132
|
|
|
0.0144
|
|
|
0.0135
|
|
|
0.0143
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Customer trade receivables
|
|
$
|
49,860
|
|
|
$
|
62,974
|
|
Other receivables
|
|
18,002
|
|
|
9,092
|
|
||
Income tax receivable
|
|
52
|
|
|
475
|
|
||
Due from related parties (note 8(a))
|
|
97
|
|
|
272
|
|
||
Allowance for doubtful accounts
|
|
(6,086
|
)
|
|
(5,863
|
)
|
||
|
|
$
|
61,925
|
|
|
$
|
66,950
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Purchased parts
|
|
$
|
36,948
|
|
|
$
|
32,814
|
|
Work-in-process
|
|
3,104
|
|
|
2,854
|
|
||
Finished goods
|
|
16,053
|
|
|
12,134
|
|
||
Inventory on consignment
|
|
—
|
|
|
4
|
|
||
|
|
$
|
56,105
|
|
|
$
|
47,806
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Cummins Westport Inc. (a)
|
|
$
|
8,122
|
|
|
$
|
7,850
|
|
Weichai Westport Inc. (b)
|
|
1,824
|
|
|
1,824
|
|
||
Other equity-accounted investees
|
|
861
|
|
|
913
|
|
||
|
|
$
|
10,807
|
|
|
$
|
10,587
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Current assets:
|
|
|
|
|
|
|
||
Cash and short-term investments
|
|
$
|
93,454
|
|
|
$
|
90,296
|
|
Accounts receivable
|
|
655
|
|
|
1,363
|
|
||
Long-term assets:
|
|
|
|
|
||||
Property, plant and equipment
|
|
722
|
|
|
844
|
|
||
Deferred income tax assets
|
|
20,327
|
|
|
21,322
|
|
||
Total assets
|
|
$
|
115,158
|
|
|
$
|
113,825
|
|
Current liabilities:
|
|
|
|
|
||||
Current portion of warranty liability
|
|
$
|
19,530
|
|
|
$
|
19,816
|
|
Current portion of deferred revenue
|
|
14,875
|
|
|
16,678
|
|
||
Accounts payable and accrued liabilities
|
|
8,144
|
|
|
3,858
|
|
||
|
|
42,549
|
|
|
40,352
|
|
||
Long-term liabilities:
|
|
|
|
|
||||
Warranty liability
|
|
28,815
|
|
|
30,463
|
|
||
Deferred revenue
|
|
23,714
|
|
|
23,667
|
|
||
Other long-term liabilities
|
|
3,826
|
|
|
3,631
|
|
||
|
|
56,355
|
|
|
57,761
|
|
||
Total liabilities
|
|
$
|
98,904
|
|
|
$
|
98,113
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Product revenue
|
$
|
41,499
|
|
|
$
|
54,626
|
|
|
$
|
89,045
|
|
|
$
|
116,575
|
|
Parts revenue
|
24,933
|
|
|
29,394
|
|
|
54,055
|
|
|
59,703
|
|
||||
|
66,432
|
|
|
84,020
|
|
|
143,100
|
|
|
176,278
|
|
||||
Cost of revenue and expenses:
|
|
|
|
|
|
|
|
|
|
|
|||||
Cost of product and parts revenue
|
48,234
|
|
|
58,813
|
|
|
103,261
|
|
|
123,227
|
|
||||
Research and development
|
4,186
|
|
|
3,908
|
|
|
8,652
|
|
|
7,579
|
|
||||
General and administrative
|
366
|
|
|
122
|
|
|
792
|
|
|
694
|
|
||||
Sales and marketing
|
2,882
|
|
|
5,675
|
|
|
6,269
|
|
|
9,572
|
|
||||
Foreign exchange (gain) loss
|
83
|
|
|
(1
|
)
|
|
4
|
|
|
2
|
|
||||
|
55,751
|
|
|
68,517
|
|
|
118,978
|
|
|
141,074
|
|
||||
Income from operations
|
10,681
|
|
|
15,503
|
|
|
24,122
|
|
|
35,204
|
|
||||
Interest and investment income
|
231
|
|
|
499
|
|
|
729
|
|
|
1,267
|
|
||||
Income before income taxes
|
10,912
|
|
|
16,002
|
|
|
24,851
|
|
|
36,471
|
|
||||
Income tax expense
|
2,493
|
|
|
4,263
|
|
|
5,822
|
|
|
7,528
|
|
||||
Net income
|
$
|
8,419
|
|
|
$
|
11,739
|
|
|
$
|
19,029
|
|
|
$
|
28,943
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
|
|
|
Accumulated
|
|
|
Net book
|
|
|||
June 30, 2020
|
|
Cost
|
|
|
depreciation
|
|
|
value
|
|
|||
Land and buildings
|
|
$
|
4,944
|
|
|
$
|
1,629
|
|
|
$
|
3,315
|
|
Computer equipment and software
|
|
5,715
|
|
|
4,522
|
|
|
1,193
|
|
|||
Furniture and fixtures
|
|
4,148
|
|
|
3,659
|
|
|
489
|
|
|||
Machinery and equipment
|
|
93,618
|
|
|
46,399
|
|
|
47,219
|
|
|||
Leasehold improvements
|
|
11,658
|
|
|
8,042
|
|
|
3,616
|
|
|||
|
|
$
|
120,083
|
|
|
$
|
64,251
|
|
|
$
|
55,832
|
|
|
|
|
|
|
Accumulated
|
|
|
Net book
|
|
|||
December 31, 2019
|
|
Cost
|
|
|
depreciation
|
|
|
value
|
|
|||
Land and buildings
|
|
$
|
4,764
|
|
|
$
|
1,565
|
|
|
$
|
3,199
|
|
Computer equipment and software
|
|
5,601
|
|
|
4,521
|
|
|
1,080
|
|
|||
Furniture and fixtures
|
|
4,213
|
|
|
3,715
|
|
|
498
|
|
|||
Machinery and equipment
|
|
91,926
|
|
|
41,775
|
|
|
50,151
|
|
|||
Leasehold improvements
|
|
11,463
|
|
|
7,535
|
|
|
3,928
|
|
|||
|
|
$
|
117,967
|
|
|
$
|
59,111
|
|
|
$
|
58,856
|
|
|
|
|
|
Accumulated
|
|
|
Net book
|
|
||||
June 30, 2020
|
|
Cost
|
|
|
amortization
|
|
|
value
|
|
|||
Brands, patents and trademarks
|
|
$
|
20,376
|
|
|
$
|
9,903
|
|
|
$
|
10,473
|
|
Technology
|
|
5,443
|
|
|
4,956
|
|
|
487
|
|
|||
Customer contracts
|
|
12,138
|
|
|
11,097
|
|
|
1,041
|
|
|||
Other intangibles
|
|
328
|
|
|
328
|
|
|
—
|
|
|||
Total
|
|
$
|
38,285
|
|
|
$
|
26,284
|
|
|
$
|
12,001
|
|
|
|
|
|
Accumulated
|
|
|
Net book
|
|
||||
December 31, 2019
|
|
Cost
|
|
|
amortization
|
|
|
value
|
|
|||
Patents and trademarks
|
|
$
|
20,386
|
|
|
$
|
9,333
|
|
|
$
|
11,053
|
|
Technology
|
|
5,457
|
|
|
4,917
|
|
|
540
|
|
|||
Customer contracts
|
|
12,150
|
|
|
10,668
|
|
|
1,482
|
|
|||
Other intangibles
|
|
328
|
|
|
328
|
|
|
—
|
|
|||
Total
|
|
$
|
38,321
|
|
|
$
|
25,246
|
|
|
$
|
13,075
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Trade accounts payable
|
|
$
|
44,085
|
|
|
$
|
60,170
|
|
Accrued payroll
|
|
18,212
|
|
|
15,906
|
|
||
Taxes payable
|
|
4,286
|
|
|
3,497
|
|
||
Deferred revenue
|
|
1,934
|
|
|
2,717
|
|
||
Accrued interest
|
|
777
|
|
|
1,568
|
|
||
Due to related parties
|
|
384
|
|
|
794
|
|
||
Other payables
|
|
1,517
|
|
|
1,528
|
|
||
|
|
$
|
71,195
|
|
|
$
|
86,180
|
|
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||
Operating lease cost:
|
|
|
|
|
|
|
|
|
||||||||
Amortization of right-of-use assets
|
|
$
|
789
|
|
|
$
|
944
|
|
|
$
|
1,476
|
|
|
$
|
1,829
|
|
Interest
|
|
69
|
|
|
261
|
|
|
223
|
|
|
506
|
|
||||
Total lease cost
|
|
$
|
858
|
|
|
$
|
1,205
|
|
|
$
|
1,699
|
|
|
$
|
2,335
|
|
|
|
|
||
The remainder of 2020
|
|
$
|
2,041
|
|
2021
|
|
3,646
|
|
|
2022
|
|
3,570
|
|
|
2023
|
|
2,542
|
|
|
2024
|
|
1,978
|
|
|
Thereafter
|
|
3,816
|
|
|
Total undiscounted cash flows
|
|
17,593
|
|
|
Less: imputed interest
|
|
(2,201
|
)
|
|
Present value of operating lease liabilities
|
|
15,392
|
|
|
Less: current portion
|
|
(3,864
|
)
|
|
Long term operating lease
|
|
$
|
11,528
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Term loan facilities, net of debt issuance costs (a)
|
|
$
|
26,722
|
|
|
$
|
22,207
|
|
Senior financing (b)
|
|
2,130
|
|
|
2,504
|
|
||
Convertible debt (c)
|
|
17,456
|
|
|
17,431
|
|
||
Other bank financing (d)
|
|
6,834
|
|
|
5,105
|
|
||
Capital lease obligations (e)
|
|
2,195
|
|
|
1,632
|
|
||
Balance, end of period
|
|
55,337
|
|
|
48,879
|
|
||
Current portion
|
|
(22,270
|
)
|
|
(13,567
|
)
|
||
Long-term portion
|
|
$
|
33,067
|
|
|
$
|
35,312
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Term loan facilities
|
|
Senior financing
|
|
Convertible Debt
|
|
Other bank financing
|
|
Capital lease obligations
|
|
Total
|
||||||||||||
Remainder of 2020
|
|
$
|
3,352
|
|
|
$
|
766
|
|
|
$
|
7,500
|
|
|
$
|
5,151
|
|
|
$
|
482
|
|
|
$
|
17,251
|
|
2021
|
|
11,187
|
|
|
895
|
|
|
—
|
|
|
532
|
|
|
689
|
|
|
13,303
|
|
||||||
2022
|
|
8,984
|
|
|
469
|
|
|
—
|
|
|
532
|
|
|
426
|
|
|
10,411
|
|
||||||
2023
|
|
2,050
|
|
|
—
|
|
|
9,956
|
|
|
532
|
|
|
373
|
|
|
12,911
|
|
||||||
2024 and thereafter
|
|
1,149
|
|
|
—
|
|
|
—
|
|
|
87
|
|
|
225
|
|
|
1,461
|
|
||||||
|
|
$
|
26,722
|
|
|
$
|
2,130
|
|
|
$
|
17,456
|
|
|
$
|
6,834
|
|
|
$
|
2,195
|
|
|
$
|
55,337
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Balance, beginning of period
|
|
$
|
18,258
|
|
|
$
|
20,935
|
|
Accretion expense
|
|
1,397
|
|
|
3,357
|
|
||
Repayment
|
|
(5,948
|
)
|
|
(6,034
|
)
|
||
Balance, end of period
|
|
13,707
|
|
|
18,258
|
|
||
Current portion
|
|
(7,268
|
)
|
|
(5,936
|
)
|
||
Long-term portion
|
|
$
|
6,439
|
|
|
$
|
12,322
|
|
|
|
|
|
|
||
2021
|
|
|
|
$
|
7,268
|
|
2022
|
|
|
|
5,103
|
|
|
2023
|
|
|
|
1,162
|
|
|
2024
|
|
|
|
1,637
|
|
|
2025
|
|
|
|
2,270
|
|
|
2026
|
|
|
|
2,851
|
|
|
|
|
|
|
$
|
20,291
|
|
|
|
June 30, 2020
|
|
December 31, 2019
|
||||
Balance, beginning of period
|
|
$
|
8,901
|
|
|
$
|
4,941
|
|
Warranty claims
|
|
(1,192
|
)
|
|
(1,863
|
)
|
||
Warranty accruals
|
|
11,265
|
|
|
6,794
|
|
||
Change in estimate
|
|
(43
|
)
|
|
(481
|
)
|
||
Impact of foreign exchange
|
|
113
|
|
|
(490
|
)
|
||
Balance, end of period
|
|
19,044
|
|
|
8,901
|
|
||
Less: current portion
|
|
(13,885
|
)
|
|
(4,505
|
)
|
||
Long-term portion
|
|
$
|
5,159
|
|
|
$
|
4,396
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Six months ended June 30, 2020
|
|
|
Six months ended June 30, 2019
|
|
||||||||
|
|
Number of
units
|
|
|
Weighted
average
grant
date fair
value
(CDN $)
|
|
|
Number of
units
|
|
|
Weighted
average
grant
date fair
value
(CDN $)
|
|
||
Outstanding, beginning of period
|
|
1,777,941
|
|
|
$
|
3.19
|
|
|
2,667,403
|
|
|
$
|
6.00
|
|
Granted
|
|
271,426
|
|
|
1.61
|
|
|
309,236
|
|
|
2.53
|
|
||
Exercised
|
|
(340,423
|
)
|
|
2.09
|
|
|
(282,875
|
)
|
|
3.11
|
|
||
Forfeited/expired
|
|
(14,017
|
)
|
|
2.65
|
|
|
(26,387
|
)
|
|
3.79
|
|
||
Outstanding, end of period
|
|
1,694,927
|
|
|
$
|
3.15
|
|
|
2,667,377
|
|
|
$
|
4.35
|
|
Units outstanding and exercisable, end of period
|
|
99,608
|
|
|
$
|
1.72
|
|
|
2,219,207
|
|
|
$
|
4.60
|
|
|
|
June 30, 2020
|
|
|
|
|
(CDN $)
|
|
|
Share units:
|
|
|
||
Outstanding
|
|
$
|
2,797
|
|
Exercisable
|
|
164
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Three Months Ended June 30,
|
|
|
Six Months Ended June 30,
|
|
||||||||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
||||||
Cost of revenue
|
|
$
|
46
|
|
|
$
|
—
|
|
|
$
|
58
|
|
|
$
|
—
|
|
||
Research and development
|
|
58
|
|
|
23
|
|
|
106
|
|
|
97
|
|
||||||
General and administrative
|
|
473
|
|
|
231
|
|
|
980
|
|
|
523
|
|
||||||
Sales and marketing
|
|
40
|
|
|
76
|
|
|
97
|
|
|
106
|
|
||||||
|
|
$
|
617
|
|
|
$
|
330
|
|
|
$
|
1,241
|
|
$
|
1,241
|
|
$
|
726
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
Three months ended June 30, 2020
|
|||||||||||
|
Revenue
|
|
Operating income (loss)
|
|
Depreciation & amortization
|
|
Equity income (loss)
|
|
||||
OEM
|
$
|
19,079
|
|
$
|
1,106
|
|
$
|
2,147
|
|
$
|
(89
|
)
|
IAM
|
16,885
|
|
(1,185
|
)
|
1,184
|
|
—
|
|
||||
Corporate
|
—
|
|
1,806
|
|
71
|
|
4,210
|
|
||||
CWI - 50%
|
33,216
|
|
5,341
|
|
30
|
|
—
|
|
||||
Total segment
|
69,180
|
|
7,068
|
|
3,432
|
|
4,121
|
|
||||
Less: CWI - 50%
|
(33,216
|
)
|
(5,341
|
)
|
(30
|
)
|
—
|
|
||||
Total consolidated
|
$
|
35,964
|
|
$
|
1,727
|
|
$
|
3,402
|
|
$
|
4,121
|
|
|
Three months ended June 30, 2019
|
|||||||||||
|
Revenue
|
|
Operating income (loss)
|
|
Depreciation & amortization
|
|
Equity income
|
|
||||
OEM
|
$
|
44,856
|
|
$
|
(2,970
|
)
|
$
|
2,591
|
|
$
|
16
|
|
IAM
|
37,563
|
|
3,450
|
|
1,326
|
|
—
|
|
||||
Corporate
|
—
|
|
(6,359
|
)
|
47
|
|
5,869
|
|
||||
CWI - 50%
|
42,010
|
|
7,752
|
|
(96
|
)
|
—
|
|
||||
Total Segment
|
124,429
|
|
1,873
|
|
3,868
|
|
5,885
|
|
||||
Less: CWI - 50%
|
(42,010
|
)
|
(7,752
|
)
|
96
|
|
—
|
|
||||
Total Consolidated
|
$
|
82,419
|
|
$
|
(5,879
|
)
|
$
|
3,964
|
|
$
|
5,885
|
|
Discontinued Operations
|
$
|
—
|
|
$
|
(240
|
)
|
$
|
—
|
|
$
|
—
|
|
|
Six months ended June 30, 2020
|
|||||||||||
|
Revenue
|
|
Operating income (loss)
|
|
Depreciation & amortization
|
|
Equity income (loss)
|
|
||||
OEM
|
$
|
53,351
|
|
$
|
(13,367
|
)
|
$
|
3,994
|
|
$
|
(26
|
)
|
IAM
|
49,836
|
|
3,574
|
|
2,645
|
|
—
|
|
||||
Corporate
|
—
|
|
(8,353
|
)
|
132
|
|
9,514
|
|
||||
CWI - 50%
|
71,550
|
|
12,061
|
|
61
|
|
—
|
|
||||
Total Segment
|
174,737
|
|
(6,085
|
)
|
6,832
|
|
9,488
|
|
||||
Less: CWI - 50%
|
(71,550
|
)
|
(12,061
|
)
|
(61
|
)
|
—
|
|
||||
Total Consolidated
|
$
|
103,187
|
|
$
|
(18,146
|
)
|
$
|
6,771
|
|
$
|
9,488
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
Six months ended June 30, 2019
|
|||||||||||
|
Revenue
|
|
Operating income (loss)
|
|
Depreciation & amortization
|
|
Equity income
|
|
||||
OEM
|
$
|
83,867
|
|
$
|
(5,722
|
)
|
$
|
5,404
|
|
$
|
69
|
|
IAM
|
71,743
|
|
5,691
|
|
2,765
|
|
—
|
|
||||
Corporate
|
—
|
|
(14,611
|
)
|
125
|
|
14,471
|
|
||||
CWI - 50%
|
88,139
|
|
17,602
|
|
(20
|
)
|
—
|
|
||||
Total Segment
|
243,749
|
|
2,960
|
|
8,274
|
|
14,540
|
|
||||
Less: CWI - 50%
|
(88,139
|
)
|
(17,602
|
)
|
20
|
|
—
|
|
||||
Total Consolidated
|
$
|
155,610
|
|
$
|
(14,642
|
)
|
$
|
8,294
|
|
$
|
14,540
|
|
Discontinued Operations
|
$
|
—
|
|
$
|
(240
|
)
|
$
|
—
|
|
$
|
—
|
|
|
|
% of revenue
|
||||||||||
|
|
Three months ended June 30,
|
|
|
Six months ended June 30,
|
|
||||||
|
|
2020
|
|
|
2019
|
|
|
2020
|
|
|
2019
|
|
Europe
|
|
66
|
%
|
|
67
|
%
|
|
66
|
%
|
|
67
|
%
|
Americas
|
|
15
|
%
|
|
19
|
%
|
|
17
|
%
|
|
17
|
%
|
Asia
|
|
9
|
%
|
|
8
|
%
|
|
8
|
%
|
|
9
|
%
|
Other
|
|
10
|
%
|
|
6
|
%
|
|
9
|
%
|
|
7
|
%
|
|
|
June 30, 2020
|
|
|
December 31, 2019
|
|||
OEM
|
|
$
|
124,511
|
|
|
$
|
132,179
|
|
IAM
|
|
113,558
|
|
|
119,769
|
|
||
Corporate
|
|
24,671
|
|
|
27,978
|
|
||
CWI - 50%
|
|
57,579
|
|
|
56,913
|
|
||
Total segment assets
|
|
320,319
|
|
|
336,839
|
|
||
Less: CWI - 50%
|
|
(57,579
|
)
|
|
(56,913
|
)
|
||
Total consolidated assets
|
|
$
|
262,740
|
|
|
$
|
279,926
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
|
Carrying
amount
|
|
|
Contractual
cash flows
|
|
|
< 1 year
|
|
|
1-3 years
|
|
|
4-5 years
|
|
|
>5 years
|
|
||||||
Accounts payable and accrued liabilities
|
|
$
|
71,195
|
|
|
$
|
71,195
|
|
|
$
|
71,195
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Term loan facilities (note 13 (a))
|
|
26,722
|
|
|
29,963
|
|
|
9,236
|
|
|
17,491
|
|
|
3,236
|
|
|
—
|
|
||||||
Senior financing (note 13 (b))
|
|
2,130
|
|
|
2,208
|
|
|
830
|
|
|
1,378
|
|
|
—
|
|
|
—
|
|
||||||
Convertible debt (note 13 (c))
|
|
17,456
|
|
|
18,943
|
|
|
7,500
|
|
|
11,443
|
|
|
—
|
|
|
—
|
|
||||||
Other bank financing (note 13 (d))
|
|
6,834
|
|
|
6,846
|
|
|
5,156
|
|
|
1,069
|
|
|
532
|
|
|
89
|
|
||||||
Long-term royalty payable (note 14)
|
|
13,707
|
|
|
20,291
|
|
|
7,268
|
|
|
6,265
|
|
|
3,907
|
|
|
2,851
|
|
||||||
Capital lease obligations (note 13 (e))
|
|
2,195
|
|
|
2,568
|
|
|
765
|
|
|
1,130
|
|
|
599
|
|
|
74
|
|
||||||
Operating lease obligations
|
|
15,392
|
|
|
17,593
|
|
|
2,042
|
|
|
7,216
|
|
|
4,519
|
|
|
3,816
|
|
||||||
|
|
$
|
155,631
|
|
|
$
|
169,607
|
|
|
$
|
103,992
|
|
|
$
|
45,992
|
|
|
$
|
12,793
|
|
|
$
|
6,830
|
|
WESTPORT FUEL SYSTEMS INC.
|
Notes to Condensed Consolidated Interim Financial Statements (unaudited)
|
(Expressed in thousands of United States dollars, except share and per share amounts)
|
Three and six months ended June 30, 2020 and 2019
|
|
Level 1 –
|
Unadjusted quoted prices in active markets for identical assets or liabilities.
|
|
|
|
|
Level 2 –
|
Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
|
|
|
|
|
Level 3 –
|
Inputs for the asset or liability that are not based on observable market data (unobservable inputs).
|