Volcon has reported its operational highlights and financial results for the first quarter of 2023.
- The company has 143 dealers as of March 31, 2023
- If all orders are fulfilled, the company has taken Stag pre-orders of more than $113 million of expected revenue
- The company has delivered its first five Stag validation units in 2023 that include the custom suspension parts in addition to the GM propulsion components
- The Grunt EVO and Runt LT launch are expected in the second quarter of 2023
- The company signed its Brazil distributor agreement
- Revenue: The Company’s revenue for the first quarter of 2023 was $1.2 million, an increase of $0.8 million over the fourth quarter 2022, and consistent with the revenue for the first quarter of 2022. The increase over the fourth quarter of 2022 was partially due to an increase in Brats and partially due to Grunts sold in the fourth quarter of 2022. Revenue for the first quarter of 2022 represents the sale of Grunts and accessories directly to consumers from the deposits paid by these customers during 2021.
- Net loss: The Company’s net loss was $7.3 million for the first quarter of 2023 compared to a net loss of $7.8 million for the fourth quarter of 2022 and $8.6 million for the first quarter of 2022.
- Adjusted EBITDA: The Company’s adjusted EBITDA for the first quarter of 2023 was a loss of $4.4 million compared to a loss of $5.4 million for the fourth quarter of 2022 and a loss of $6.9 million for the first quarter of 2022.
Volcon had a net loss of eight dealers and Stag pre-orders in the quarter due to dealer terminations.
“We stated in our press release announcing our annual 2022 results that we purposely slowed signing of powersports dealers as management expected product shortages in transitioning the manufacturing of the Grunt to a third-party manufacturer,” says Jordan Davis, CEO of Volcon. “The shortage of certain parts due to supply chain delays also was a factor. The company still expects to have over 250 dealers in the U.S. and Canada signed by the end of 2023.”
He continues, “Preorders for the Grunt EVO and Runt LT from dealers and distributors began in April 2023 and shipments are expected to begin in the second quarter 2023. Pre-orders and interest for the Stag from dealers and consumers continues to be strong and we continued to take waitlist orders from interested dealers and end users alike during the first quarter of 2023, with shipments expected to begin in late second quarter or early third quarter 2023.”
Shipping is expected to begin in the second quarter of 2023. The company also signed an agreement with a distributor in Brazil in March with minimum purchase requirements of $12 million (net of discounts and rebates) of Volcon products over three years.
The company’s third-party manufacturer has entered into an agreement to have Electrameccanica Motor Vehicles (EMV) (Nasdaq ticker SOLO) complete final assembly of the Grunt EVO, RUNT and Stag in their Mesa, Arizona facility. Vertical integration of components such as frames, panels and suspension components will continue to be done in the manufacturer’s Puebla, Mexico facility for the foreseeable future.
Davis comments, “Having final assembly of our products in the United States allows for better distribution to our domestic customers and reduces costs to move key components, primarily the GM propulsion components for the Stag,” Davis says. “We will continue exploring gains in distribution efficiency for our Latin American and South American partners as well.”
The Stag’s development continued to progress during the first quarter of 2023. In early 2023, Volcon took delivery of the first three Stag validation units that include the Volcon designed suspension, GM propulsion components, as well as Elka shocks. The company has taken delivery of two more Stag validation units.
“These additional advanced validation units continue to improve in performance, fitment and finish and we are pleased with the progress we are making as each additional unit is fielded,” says Christian Okonsky, Chief Technology Officer of Volcon.
Delivery of the Stag is expected to begin late in the second quarter of 2023 or early third quarter of 2023.
Volcon continues to receive and test iterations of the Grunt EVO, the replacement for the Grunt, which includes replacing the chain drive with a Gates belt drive, an improved rear suspension and ergonomically improved seat, as well as modifications to styling. The Grunt EVO will also be available in three colors.
“The improvements the Grunt EVO provides in comparison to the Grunt demonstrates our commitment to continuously improve our products,” says Davis. “Similarly, we continue to receive and test iterations of the Runt LT, Grunt EVO’s baby brother, which has a hub motor rather than a chain or belt drive and will also be available in two colors.”
Volcon expects the Grunt EVO and Runt LT to be available for sale in the second quarter of 2023.