Ebusco Holding (EBUS) Q3 2024 TU earnings summary

Executive summary

• Christian Schreyer appointed CEO in September 2024, with management changes including consolidation of CTO and COO roles and CFO's planned departure after the rights issue.

• A comprehensive Turnaround Plan focuses on operational restructuring, cost reduction, a shift to an Original Equipment Design model, and European market concentration.

• The plan targets a monthly run rate of 40-50 buses by end-2025 (up from ~15/month in 2024) and a structural annual cost reduction of €30 million.

• Ebusco is rationalizing its production footprint, reducing locations from seven to five, and combining facilities in the Netherlands.

• Severe liquidity issues in H2 2024 resulted in production nearly halting, delayed deliveries, and strained supplier/customer relations.

Financial highlights

• 135 buses delivered in the first nine months of 2024, with 37 in Q3; orderbook as of 30 September 2024 stands at 1,595 buses.

• Orderbook impacted by cancellations: Qbuzz (45 buses), Connect Bus (47), Keolis (50), and a major customer (59); some produced buses may be reassigned.

• Overdue accounts payable of approximately €33 million; breach of payment obligations under guarantee facilities totaling €6.2 million.

• Production has nearly halted, leading to severe cash shortages and delayed deliveries.

Outlook and guidance

• 2024 outlook withdrawn in June due to financial and operational challenges.

• The Turnaround Plan is expected to be fully implemented by end-2025, with all actions completed before then.

• Working capital expected to reach its lowest in Q1 2025, with improvement anticipated in Q2 2025.

• Rights issue of €36 million planned to restore balance sheet and support liquidity, targeted for completion in November 2024.

• If the rights issue is not fully subscribed, the offering will be canceled.