PPSI - Earnings call transcript Q3 2024 | Pioneer Power Solutions, Inc.

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Operator

Greetings, and welcome to the Pioneer Power Third Quarter 2024 Earnings Conference Call. [Operator Instructions] As a reminder, this conference is being recorded. It is now my pleasure to introduce your host, Brett Maas of Hayden Investor Relations. Thank you.

You may begin.

Brett Maas

Thank you, operator. eMobility. be Walter Nathan and Michalec, President Pioneer will Chief Chairman Geo today of Officer; Executive Chief Power call hosted Mazurek, by and Murickan, The Financial Officer;

Q&A Following session call. this appreciate to results quarter opportunity the the will highlights. and discussion, be recent We open participants business on there to the third financial review a

Before webcast. and is being we get recorded started, let me remind you, this call

Mazurek, subject and to to differ These call, and regarding to statements and go please forward-looking earnings the forward-looking release are assumptions management CEO. to the and the current on materially. Please ahead. text this could are applies of Nathan During that which statements. like call. I'd expectations today, call risks Chairman to statements content uncertainties cause the the in now may Nathan, issued contained based results turn make earlier actual to cautionary over refer

Nathan Mazurek

you joining you, and for us Brett. all thank today. afternoon, Good Thank

our XXth, approximately a supporting provider likely United As million line Mill transition of the solutions aware are New Voltaris sold now. in approximately in System of addition, significant its business, primary in E-Bloc whose purchased sale business is platform. Concurrently equity also group, build you Products Electrical Electrical to from the Voltaris specifically, on new the ERMCO product in transaction. More going the Capital, generational Jefferson on equity as with right equity proceeds business $XX received into of Integrated for Electric Point's by efforts October from Products, York-based part Point X% E-Bloc and received Point an a unit, Mill the dry-type Power energy power million PSEP we the States purchase Pioneer cash our Mill stake a to transformer Pioneer now, private cash Custom $XX and in

original equity business as and platform. are owners profitably be E-Bloc part to of grow expect we We pleased to Voltaris, of to this the continue rapidly and

November of XXth, of announced of XXXX. Pioneer's we XX, XXXX, paid Board cash declared record that per dividend of to $X.XX X, on be Directors special shareholders December January Finally, share to as a onetime on

Power Critical sale Point by platform, indeed and November remarks. of anchored Pioneer our first Mill remains charging sole in be business operating Our is This the business business to in the that mobile will after our unit focus the introduced XXXX. prepared E-BOOST is

In addition, traditional and revenue related service and some mobile sales. on-site power

introduction of November quarter time outstanding and third first During of revenue growth for generated the delivered since year-over-year of the the business XXXX, E-BOOST XXX% the platform operating income this in XXXX. positive of

each system and solution new DC of most evolving a we in limited mobile EV service vehicle truck our fast and charging EV we E-Boost DC charging Pod, charging users. E-Boost be trailer-based energy XXXX. In units the What E-Boost expect Mini, believe delivered the the groundbreaking become design a ability Mobile, X-plus $XX with to a E-Boost over into wider pulled we the with collaboration, storage evolved truck-mounted and off-grid platform value over unlock XX EV solutions, the XX,XXX and charging battery truck-mounted that end systems. Together, or a diverse semi-permanent fast storage of charging integrated year, backlog fact, integrating to SparkCharge, solutions. Since And about zero rapidly aim XX% our XXXX a tractor. E-Boost date, business approximately shipping of expansion of these provider charging began units can the net inclusive has charging industry SparkCharge's the integrated fast has solutions. a regions a To the proven base by economical this date, XXX E-Boost can our innovate not either. deliver have that E-Boost the sessions and market provides this container to at for mobile truck sustainable solution Critical we power. Innovation As EV powered mobile in charging and/or E-Boost that have a extreme into needs address year, million, fast technological to November in model. total announced we AAA largest to years of fast has rural, work unit that electrically G.O.A.T, invokes spawned a has projected our compared and year-end more for our single quarter, the taken plus for synonymous for this battery $XX one a XXXX. And accelerate mechanically megawatts and/or of the as of an weather segment, two finally, drive in system charging, delivered and off-grid charging increase we XXXX scope to be mobile the units customize reliable applications. With the E-Boost usually approximately prominent this of DC August a original sustainably moved and unique and market utilizing States. Through over scalable and can SparkCharge million United have charging advancements the of to product for energy backlog of as last revenue towards collaboration E-BOOST adoption solution XXXX. active we August, with suit been basis our the forklift, skid-based had E-BOOST solution revenue guidance most unit. Product high-growth the in of DC Power in to third a charging and to

cases, that have of for electrification variety bus vertical municipalities fleets. and we use identified their across and opportunities diverse including a markets ports, of municipal, tremendous are addition, the airports, with fleets, growth In proceeding vehicle utilities

We are massive for sale business our and and continue to zero from growing with the the opportunities debt. believe e-mobility PSEP of proceeds

our fund over necessary plans the growth next capital years. the to have several We

and guidance $XX $XX revenue initiating million. We are for XXXX between million of

we the sale, smaller some of quarter-to-quarter. result will PSEP see and business variability are likely a a As we

to this meet guidance. in looking XXXX, of However, are ability full across the we year our confident

EPA-rated streams on resiliency in the million consistent generate backup the innovating point, Home EV products million charging regional XXXX residential expand to revenue new the also XX/X. This the approximately per millions events, XXXX to the powered which commercial States of equipment by the revenue product expect be needs a be additionally maintenance small fast-charging by to hours addresses mall addresses and This produced our minimal and for can continually our $X.X of plan business provide too remain and to and be $XX further, need United rental of as committed across our that homeowners and are to service meet E-Boost distributors for simultaneously EV expect during or set to a frequent service to we bring common for growing market subject uptime E-Boost revenue markets. Home for now $XX our adverse about $XX climate natural expect of engine address and power and home, on developed from our the demand launching customers. it of agreements. We the at product gas of We market per line sale product we million generators during prime derived day is plus run business. Of million, constricted from can lease/-rental type equipment. Breaking an we market, are was approximately line bit rental longer-term and the from currently first can fast that especially year, in run growth. To majority to of outages. It on our and sales dealers. of our their that the that businesses, longer-term early smaller charging emerging it the maintenance lines. needs well solution primarily focused on that and centers, their as operate utilize and existing E-Boost approximately option for designed includes especially is and through And unlike or charging the mini segment product targeted and the retail to down same solution to

additional We are market. on commercial growing to capitalize focus and resources deploying on this

Another units. our Pure the dynamic for has E-Boost sale and market Power is developed us that rental of

for of large energy reformers been With where recharge offers powerful power Power demand hydrogen not or the grid today raw reliable large, the for power quickly hydrogen and needs increasing and power, powered battery growth hydrogen and and fueling on-site has units Pure are to customers. sustainably there storage BESS will station, deployment connections BESS systems, available the to in power the future. E-Boost of on-site battery near more to units support deployable, the

single a looked usually that massive our application will units as to commercial away from utility diversify exploring a not additional We enterprises, do connection. for footprint electrical have be expensive particularly businesses opportunities

offices surgery Specifically, the are medical/dental centers, restaurants solutions we power small to those type facilities, and marketing like. and

nothing opportunistic plan we terms of in to that acquisitions while Finally, strategic there is imminent, with be might we pursue. any transactions,

are in for businesses E-Boost the I our that, and platform would with to indeed at that our least looking immediately million will We be current revenue $XX call earnings. With sizable primarily complementary Walter. to are turn over accretive to

Walter Michalec

Nathan, and you, good everyone. Thank afternoon,

our successfully L.A. gross we proceeds primarily strong sale million $XX balance cash equity the leaving earlier, total for and in As of in very our a as cash October cash Nathan on business, on we closed position. PSEP, of received mentioned million, XX, transaction, sheet a $XX

solutions, is the operating Power the Critical after which remains Our E-Boost business sole sale. includes the that business, unit

the recently my business. So, the continuing prepared operations, of only sold the results PSEP remarks consider excluding

of Critical The due $X.X business. the quarter increase growth business in $X.X E-Boost Third our increase the million compared Power was an in million XXX%. revenue for segment approximately was primarily to year to quarter, ago the

million at million that customer Pioneer quarter recognizing in of business total delivering alone. To was all perspective, $X a Our approximately XXXX. successful put our in contract was this third Canada, to charging revenue E-mobility from in E-Boost during revenue approximately for multiple solutions from $X E-Boost team in the

Critical margin growth to in of year. The profit our the E-Boost third million gross last gross was $X.X profit the Third XX% gross of approximately or business. again Power a $XXX,XXX quarter segment XX% quarter approximately once in to was of of revenue the compared increase or for due

than the mentioned blended extremely a E-Mobility higher million at historical gross job third percentage successful that $X quarter, generating E-Boost margin roughly while hard-working approximately the the during Just on was XX our XX% and is of target. at points job. This team shipped that Pioneer dedicated

a and improve continue both that manufacturing our efforts, sales follow we suit. in We our margins expect will as to and team,

$XXX,XXX quarter last solutions XXXX, of Power and operating due During our in $XXX,XXX the the segment of the E-Boost large business. the an revenue of operating generated $XXX,XXX that primarily quarter from year. The sale Critical the higher improvement was income are seeing in margins from compared to to third generating increase our third of of loss we

we Power October, operating $XX in for updating in from given business expect to expect million to $XX indeed our and revenue now are XXXX. operations recognize guidance and segment income Lastly, continuing the significant of Critical from generate between the sale the quarter during fourth of our PSEP XXXX, also million revenue

mentioned, full year. As the the in over expect Nathan $XX any to This concludes back now I revenue to million for operator questions. call will XXXX, turn deliver of for to remarks. million we the $XX my

Operator

Street [Operator Lake first from Instructions] Our question Brown Rob is from Capital.

Robert Brown

all on progress. Congratulations the

Are out that much and And some should of what ramp? Are how refill current Or get wins? you're their how terms sort in sort these demand overall watch good XXXX customers these customer but operations to coming pipeline seeing. of you base? new through? of I in to the and are the starting laid for new are at we activity expanding activity is orders just more just see your there detail color little do customer on a You market, the of want on drivers areas

Nathan Mazurek

head overall. It's and the Yes. I new, in chime my if really of I repeat by maybe didn't segment XXXX break down as who's it. Geo all and in own well, can percentage-wise, just who's finish

repeats. of is the quasi-government. A being or are by Some segment driven lot it government that's

big however call city, comes or municipalities, Those purchase So, the that us. electric for order bus school we as buses, related, are it's them, both to particular city state, the buses moving in group so in not the forward, what charging trying going the very guess that's carriers. I but do they package is been final decisions drivers. And to active determine on making active

us FedEx, Geo, big been really in said? DHL, so for taken charging Amazons, many So, I lot And a big for a we you solutions made form electrical the Alphas, choices. that that 'XX. vehicles, unfolding to vans, every see going they've in of Service, appetite or indeed that. add have truck, do edit want Postal anything Haven't the XXXX, stronger into

Geo Murickan

Nathan. Certainly,

municipality are segment are ramp a Rob, most business that starting the do different city. from fleets coming see, numerous I related some they think you utilities and did electrifying within it. cover as more We up of a to the robust to

There's on the movement off-highway see expect a and to especially things side trucks construction. in other electrification trash some in equipment terms We and of electrification related sanitation to that. farm also equipment, like of the

of these as more electric up movements we newer orders. seeing as we all start school So, shore movements, expect well to bus transit as and

Robert Brown

a a you going it the then market. what's in have And on business see you're about of of model, particular of your sort to business that another? product you'd one couple one terms on is way you you kind you of sale. mentioned developing ways different This to or be? do preference Do versus Or rental see sort what like view or I a the Do of sort know of the developing? in

Nathan Mazurek

whatever call that to in like be go We're the we're municipalities, is us. you many to to lower plus. budgeting more off X/X that for rental, citizens budgeted X what in believe I'd for. for to think customers. Otherwise, way. side. their it. lease that want It's see XXXX That's of creditworthy X they're up got That's Many term type on they the We'd very really cost would with lucrative XXXX. lease buy. their like Yes. long to you better it capital doing sales for the They right want

buy-only cases. many in So, those it's of

both of somebody not. can the Some So, see if maybe Amazon, with carriers, we a would ways. orientation to leasing hypothetical, that do some other engage is right going it's that that lease you trying lease What's want in everything on move? basis. We way. of with use the course, of their it package sort start-up would we they the charging long-term who business, service They

Robert Brown

E-BOOST in last of at What's thinking where production business the all your your is question Do terms the capacity on kind of you need are there? for capacity? more? changes, Then with production add you to

Nathan Mazurek

California fixed really states projected investing those revenue. for cost ones and a even and it gentleman the Washington, in few been and part and We're to with do a an having keep the steady we're first That's we ourselves. capacity over course on expand for do X-unit particular what subcontractors are of one to beginning an type as reason Champlain, of outsized without one all with so, you're prototyping, the 'XX, well-suited and Southern California. The need representing continue United going have are portion I'd that Champlain, complicated that, to very call have you Oregon Yeah, single jobs. Truly to all first on been that to partner a we working West in the in don't site. Outside to States. to size similarly economical expand and of or love trying develop we've valuable XXXX to special, huge relief the of articles pressure device any on the of Champlain. Hopefully, you've couple eastern of a on idea. We're basis, the that the a

have take any to than we now we facility or on plans don't Minneapolis. any in expand right more do So,

Operator

Next Wainwright. here from Instructions] [Operator is Joshi question H.C. Sameer from

Sameer Joshi

progress. quarters? any it to gross Congrats into the the on a of all rental million the want many there mentioned coming expect And questions answered particular, $X because A a gross very there. what remarks, order in color But that a it? sale? like that my Was prepared or good of the XX%. Was actually, margins about get margins were I levels to closer of component to we being do on you in delivered was like similar should was the service

Nathan Mazurek

were complicated an maybe guys well not also on kinds that Yeah, margins. that It rated than did where really I to to at and and the faster did and able it, needed for more really which with might is those subcontractors, and job. set able amazing valuable We have gross was units, complicated, did price beginning. But we see a of features that didn't on was have X, so we And job very actually the Should we expected. final do we team very less mechanical other the expected They working than better portion. that sales lower below do E-BOOST the amazing time. shoot XX for only sale. time. We I more expertise an of certain time. especially all we been takes came it, faster, very, but all all Frankly, the electrification economically it a have in of the that wiring to they the

I It's extent better all budgeting and variable been and We've the all for test bit material. hours not units. us the a takes that the big doing been predicting things the has do to on we little probably think to special to and it us that material. that the the been other do the

at As so we've more experience, gotten better that, we've gotten too.

by years. The Finally, was when we've the little probably and probably the the quarter a event that, fourth view point quarter single laid higher this far had, than we just largest of a had will for -- quarter first the sales way X-plus out. from the XXXX last largest be are things of ever

going I come as where to to out us too as instructive far margins be out really modeling before into future. those the start gross out think to well we it's

Sameer Joshi

the to sticking diversity based of demand Rob's sort drivers customer Just here, the question. you out on and laid

represented million, But or million In it's think sales Are $XX of of many X-, this that? they how maintenance is the in customers What million, terms $XX it? is long this Like of and of cadence? mentioned. $XX are X-year I the services is rental, how the backlog most contracts? of you X-,

Nathan Mazurek

It's is strong. anything depends It on X like too to the X-year be that. That's so forth. The customer going have out. we super agreements. and to cadence think I don't type way way,

out category backlog fleet giving names, single related, be to biggest would fleet-related. is includes sometimes that or bus municipal comprising it's ask I'd school the without for whether related. Then going single in portion you But the be to backlog second broad what's If the which say the the electric a is it's probably biggest fleet, private going be a everything largest. and anything the

Sameer Joshi

one one. just last Then

Of after $XX distribute $XX think, sitting you January, probably to I on be million course, will your million dividend. whenever you

Nathan Mazurek

X. Yes, January

Sameer Joshi

opportunistic identified You did are you the you intention, your Have already M&A to front. mention potential targets on acquire?

Nathan Mazurek

that. big on a way, little a I've in not yes. general In work a done We're rush.

to are We that to We in to through, we've got can't redundancies, to and everything got drain some be compelling be that more we're accretive. after getting got on suggestions. somehow It aren't. doing a open gone a We're us. It's technology and open, it we enhances it's It's advanced quicker way. super us. or can't for has be to we're be cash enhance somewhat Sameer, we're what

Sameer Joshi

the for that squeeze of currently. any the we more I It $X around there SG&A May that on I'm your forward? the be some on must the you business on one should segment that overhead outlook revenue sure million front? overhead you SG&A seems gets was retain corporate going added level as to what SG&A expect have divestiture. of percent a it from or after Do But

Nathan Mazurek

the for it? overall how we going XXXX, into business For budgeted

Sameer Joshi

laid divested for in continuing Yes, it the for business Q, the corporate, for you business? because and the have out

Nathan Mazurek

Yes, right.

let do. Walter answer. we So, I'll

Walter Michalec

or revenue as corporate for your going in costs you overhead the a roughly thank to expenses corporate. Sameer, we of for so revenue. here to We're to expecting Overall, at of at seek question. Yes, percentage XX% are cut come

isn't, the we scale It that Critical actually layered corporate some in there. the be grow there and Power mentioned two. overhead business, might separate we As you

we depends $X Critical just it mark. R&D around the at over that business will somewhere expense be Power how SG&A the do. Then on much work million really all So,

Operator

Romano, Our next investor. a private Rob is question from

Rob Romano

profitable you the think be next can year? guidance you revenue Do on

Nathan Mazurek

we Yes, do.

Rob Romano

sequentially Critical the noticed grow Power, be significant was XXXX, you some there backlog I down pretty the into there. may do in backlog in a lumpiness and manner? you Can think

Nathan Mazurek

years. and we single are That's and we're we're every X on on goal pretty what various negotiations, Based the proposals our seeing confident where next for day.

Rob Romano

just you had bonuses if wonder filing that that. some last I large I know you regarding could comment week paid. on a were

Nathan Mazurek

with $X had me bonus was the had that and Board there. Legal $XX experience from prior the We million, Yes, they it. no price the a sale. a so had that investment for much were such. years ago, was was rewarded there That very was a largest Mill on banker, business as The we investment rest very, we to as fees low because very banker or was very no shortened were case price I less. in that very, decided Point felt X this fees fair gotten high that the well. and million me. There

Operator

If turn no comments. to further I'd there closing are floor for the to like management questions, back any

Nathan Mazurek

you support, all you our and for next to updating forward thank your and we Sure, look time on again call.

Operator

teleconference. today's concludes This

Thank may You you at for participation. disconnect again your lines your time. this

Pioneer Power Solutions (PPSI) 18 Nov 242024 Q3 Earnings call transcript