WKHS (2019 - Q4)

Ladies and gentlemen, greetings and welcome to Workhorse Group's Fourth Quarter and Full Year 2019 Investor Conference Call. As a reminder, this conference call is being recorded. It is now my pleasure to introduce your host, Workhorse' Chief Operating Officer, Dr. Rob Willison. Thank you. Dr. Willison, you may begin. Robert W

Thank you, operator and good morning, everyone. We appreciate you for taking the time to join us for our call. Before the market opened, we issued a press release with our full year results for the period ended December 31, 2019. I want to talk about the progress of our award-winning C Series. We have achieved four certifications and milestones as they relate to our Q1 production activities. I will elaborate. The first one is EPA certification. On February 13, we received the EPA Certification of Conformity or COC for the C650 and C1000 which are our full electric zero emission last mile delivery vehicles. The COC is issued by the EPA to a vehicle manufacturer to officially confirm a specific vehicle class conforms to all EPA regulations and emission standards. With this approval, the vehicle class also has the right authority to operate on US roads and highways. Clearly, EPA approvals are key step in the delivery of production vehicles in the US. The second one is brake testing. On February 26, the C Series completed tests for final calibration of it's ABS anti-lock brake functionality. For a vehicle of this size, lending regenerative braking and ABS and certifying the system was a considerable effort, we are pleased to report this has been successfully completed. The third milestone is the myriad of Federal Motor Vehicle Safety Standard or FMBSS ranging from headlights to switches to hood latch systems, and we have passed testing of each of these standards except one, which we anticipate will be completed in March. Lastly, Workhorse has earned it's ISO 9001:2015 certifications for it's quality management system. ISO 9001:2015 is a globally recognized quality management standard developed and published by the International Organization for Standardization. It was issued by Perry Johnson Registrars and the scope of Workhorse's certification includes the design development and service of electric vehicles support equipment and services. I recently posted a video to LinkedIn that garnered a lot of attention. The video show the C1000 on the durability track at The Transportation Research Center in East Liberty, Ohio. It showed how impressively suspension absorbs the bumps, the independent front rear suspension is a first in this class of commercial last mile delivery vehicles, and the video of the C1000 running on the test-track shows ride a driver can expect. This paired with a non-oil canning composite body and frame makes a superior work truck environments and less fatigue for drivers. Our C650 is also accumulating additional test miles here in Loveland. We are confident in our technology and an overall platform. We have many potential customers drive the vehicles to assess the new features and this confirms we are meeting the market's needs and expectations. Speaking of which, we hosted a ride and drive last month directed at our fleet customers. With several of the largest worldwide fleet operators attending, there were glowing reviews of the vehicles operations. As a customer-focused company, it's great to hear that our ultra-low floor, high driver visibility, flexibility in order configuration, and cost is attractive to potential customers. And a little about the award previously mentioned; at the NTEA Show last week, Workhorse's C650 won the prestigious Innovation Award in the Green category. We are happy with the accolades and that the C Series is being recognized for the groundbreaking vehicle it is designed to be. In a few moments I'm going to turn the call over to our CFO, Steve Schrader, who will walk us through our financial results for the quarter and year. After that, our CEO, Duane Hughes and I will come on the line to provide an update to our business, our production and an outlook for the remainder of the year. Before we begin, I want to call your attention to our Safe Harbor provisions for forward-looking statements that is posted on our website and as part of our year-end update. The safe harbor provision identifies risk factors that may cause actual results to differ materially from the content of our forward-looking statements. Our 2019 Form 10-K and other periodic filings will provide further details about the risk factors related to our business. And with that, I would like to turn the call over to our CFO, Steve Schrader. Steve?

Thanks, Rob, and thank you to everyone joining us for today's call. Before I begin, I just want to say that I'm excited to be part of Workhorse which is clearly at the forefront of commercial electric delivery vehicle space. I've only been on the team for a few months now, I'm incredibly encouraged and excited by the work and the progress we're making against our long-term goals. Going forward my intention is to play an increasingly integral role in helping the company meet it's manufacturing and financial goals. As many of you have been following Workhorse are aware, we are in the final stages of transitioning from our first-generation vehicles to our next new generation vehicles, which are now known as the C Series, the absence of significant revenue is primarily due to our migration to this new platform. Just a minute, Duane will be able to provide the latest update with respect to our production efforts. First, I'll now discuss our financial results for the fourth quarter and full year ended December 31, 2019. Sales for the fourth quarter of 2019 were recorded at $3,000 which was down from $21,000 in the fourth quarter of 2018. For the full year, sales were 377,000 compared to 763,000 in 2018. Decrease in sales for both, the quarter and the year, was wholly due to a decrease in the volume of trucks delivered and the focus on the engineering and design of our C Series vehicles. Cost of goods sold decreased $2.1 million from $11.1 million in the fourth quarter of 2018. The decrease was driven by warranty expense and inventory write-downs in the previous year's quarter. The full year cost of goods sold were $5.5 million compared to $15.9 million in 2018, for the same reason as noted in the fourth quarter. Selling, general and administrative expenses in the fourth quarter of 2019 were $3.6 million compared to $2.7 million in the fourth quarter of 2018. The increase in SG&A expenses was primarily due to executive stock-based compensation and legal and professional fees related to the fourth quarter's transactions, which was offset by less advertising expenses compared to the prior year. For the full year selling, general and administrative expenses decreased to $10.2 million from $11.5 million in 2018. The decrease in SG&A was due primarily to reduced advertising and lower employee head count, offset by an increase in executive stock-based compensation and higher professional and legal fees associated with the various financial transactions throughout the year. Research and development expenses in the fourth quarter of 2019 increased to $4 million from $1.7 million in the fourth quarter of 2018. For the full year 2019, research and development expenses increased to $8.2 million from $7.4 million in the previous year. This increase in R&D expenses for both, the quarter and the year was primarily due to non-reoccurring engineering and design expenses associated with the C Series delivery trucks. Other income for both, the fourth quarter and the full year 2019 was $15.8 million compared to zero in Q4 last year in the full year of 2018. The increases due to the $12.2 million related to licensing income from the company's Lordstown Motors Corporation investment, and $3.6 million from a net gain on the sale of our former SureFly personal helicopter. Interest expense net in the fourth quarter of 2019 increased to $5.6 million compared to $2.2 million from the same period last year. For the full year, interest expense net increased to $29.1 million compared to $2.4 million in 2018. Increase in interest expense for both, the quarter and the year was impacted by the prepayment of the Marathon debt facility, and by a mark-to-market adjustment on the company's warrant liability. Mark-to-market is a non-cash adjustment that is primarily driven by movement in the company's stock price. Net income for the fourth quarter was $655,000 compared with a net loss of $17.7 million in the fourth quarter of 2018. Net loss, for the full year 2019 was $37.2 million compared to a net loss in 2018 at $36.5 million. Moving to our capital markets activities; in November of last year we announced that Workhorse had entered into a convertible debenture financing agreement with an institutional lender which let the company $39 million. Those proceeds along with the SureFly sale allowed us to repay our existing debt held by Marathon Asset Management, and let the company with nearly $24 million as shown on our latest balance sheet. As part of the convertible debenture agreement, we are required to hold back $8 million of cash for collateral providing us with $16 million of cash for operations. The intent of those financing activities to provide working capital and to support initial small-scale production output. As production output ramps up to a more material amount in the second quarter of 2020, we will need additional financing and are actively pursuing a traditional credit revolver debt facility to support the tooling, materials and components needed for our manufacturing process. As a new CFO, my experience is that most companies issue an earnings release prior to 10-K and 10-Q filings. As such, you should expect our 10-K filing later this week. Finally, before turning the call over to Duane, I'm happy to report that through the hard work of our financial staff and the addition of enhancements to our internal controls and financial systems, we have eliminated our previously recorded material weaknesses. With that overview completed, I'll now turn the call over to Workhorse CEO, Duane Hughes, to discuss some of our major operational updates and provide an outlook for our business in the current quarter and for the rest of the year.

Well done, Steve, and welcome, everyone. We appreciate you joining us on our call this morning. Before I jump into our 2019 discussion, I want to first address the most recent change in our management team. As you just heard from Steve Schrader, he is our CFO, having joined the company in December 2019. And comes to us with many years of experience in CFO positions, perhaps his most significant experience was as CFO of Duke Energy's regulated business with Synergy, which was acquired by Duke Energy in 2006. We are excited to have Steve join the Workhorse management team and fully appreciate his knowledge and experience helping to continue Workhorse's growth. Welcome aboard, Steve. Reflecting on 2019; it was quite a year with a very specific set of goals to be met. As some of you may recall, I took the reins as CEO officially on February 4 and quickly announced Rob Willison as our Chief Operating Officer. Rob and I together spelled out our plan for the remainder of 2019 beyond the all-important vehicle specific engineering and production priorities, we also recognized the need to implement stocks [ph] controls, eliminating our previously reported material weakness. As Steve mentioned earlier, our accounting team led the charge and together, we all spent a significant amount of time and energy designing and executing appropriate controls, enabling us to remedy the material weakness previously identified. To reiterate, in February of 2019, we began the transition from an entrepreneurial development stage company to a highly focused production-oriented company. As such, we identified our to-do list designed to help us better manage a smaller portfolio of innovative products and to focus on creating and manufacturing the vehicles our customers have ordered. Our focus was set squarely on our commercial vehicle business, specifically in the last mile delivery segment with our engine platform, now known as the C Series electric delivery vans. As I said then and reiterate today, designing and building electric vehicles is a complex and challenging business. To compete in this space requires meaningful capital, strong partnerships, proven performance and a healthy dose of sticktuitiveness [ph]. We continue to focus on last mile delivery as we strengthen our position in this space with our C Series platform and our integrated truck launched HorseFly delivery drone technology. We also announced last year that we would work to monetize other highly innovative technologies within the Workhorse portfolio. At this time last year, we had two additional vehicle based platforms in our development and engineering cubes; we had both, the SureFly, our NAND [ph] octocopter, and our W-15 electric pickup truck. We stated we would search for a buyer of the SureFly and ultimately completed the sale of the SureFly to move incorporated in December 2019. Not only did we improve our cash position for this non-dilutive sale, we also entered into a joint venture with Moog whereby we improved our opportunities to achieve required FAA certifications, as well as to bring the HorseFly to Market. We are actively working with two customers using our vehicle launch drone technology. We haven't yet named the second customer, but we are well entrenched in the used cases, third-party testing, and certification processes required to bring the technology to market. On November 7, 2019, we announced that we have signed an intellectual property licensing agreement with Lordstown Motors Corporations which concurrently acquired the Lordstown Assembly Complex from General Motors. Under the terms of the agreement, Workhorse is granting LMC an intellectual property license related to our electric truck platform in exchange for a 10% non-dilutive equity stake in the company. This transaction has tremendous value to Workhorse. We've benefited by eliminating the need to raise and spend hundreds of millions of dollars to bring the aforementioned W-15 to market which would have diluted our shareholders. The 10% non-dilutive equity position has already contributed $12.2 million as licensing income in the fourth quarter and it also represents the potential for additional Workhorse revenue and cash streams through licensing royalties and engineering services from LMC. For example, Workhorse is entitled to a license fee equal to 1% of the gross sales on the first 200,000 units sold. Additionally, the agreement cost for LMC to prepay a portion of the royalty that are now equal to 1% of their capital raise. Lordstown complex includes a 6.2 million square foot manufacturing facility on 740 acres, with more than 1200 robots, and an experienced workforce that has been producing automobiles for generations. This complex and the workforce experience provides Workhorse with many options for contract manufacturing, assembly and engineering services for future Workhorse vehicle platforms. We are now envisioning LMC production volumes may further help decrease Workhorse component costs and engineering costs on our Workhorse specific platforms. Having an affiliated company with this level of automotive production capacity, engineering expertise, and supply chain depth, gives Workhorse an engineering capability and manufacturing footprint unrivaled in the commercial electric delivery truck manufacturing business. We are quite pleased with our Lordstown ownership. All of these 2019 achievements are important to Workhorse's future as they demonstrate that we have revamped the company. These achievements give us the opportunity to improve our focus on our vehicle engineering and assembly operations. In 2019, we cleared the clutter that so many people felt was a distraction. We strengthened our operational capability. We developed an even more experienced management team, and we've engineered the most innovative electric last mile delivery van available to date. I will start our operational discussion by talking about our C Series production activities in Q1 2020. To this end, we've produced three C Series vehicles, two 1000 cubic foot vehicles and one 650 cubic foot. These vehicles are used to achieve the required regulatory approvals and the durability results to move to production-intent vehicles and for the sales and marketing team to attract new prospects and close additional orders. The C650 was on display at NTAs Work Truck Show last week in Indianapolis, where Rob mentioned, we were the recipients of the Innovation Award in the Green category. I'm pleased to report we had tremendous activity at our booth, and we received a lot of interest from prospective new customers. We expect to turn their interest into repeat orders going forward. As Rob said, we have been working towards the final stages of preparation and certification of our C Series vehicles with the intent to begin initial production and delivery in the first quarter of this year. During the quarter, we were impacted by the global coronavirus outbreak. As a US-based manufacturer, we remained focused on sourcing parts in the US as often as possible. However, in February, we were notified by two suppliers with factories in infected areas that these companies have been through extended shutdown periods, which in turn, negatively impacted the timing of our parts being received from our supply chain. And at least one case, we have a minimum six-week delay in receiving components necessary for the final assembly of our vehicles. Of course, we are working on potential alternatives and trying to reduce the delays as much as possible while keeping an eye on cost and preparing for any additional measure of impacts that may be present. Having said this, we expect to produce and deliver vehicles to our customers beginning in April. As of today, accounting for assembly line sub -- substation assembly setup, and production employee trend; we have the internal capacity to produce two C Series trucks per day at our Union City assembly complex. As training continues and substation assembly processes are completed, we can quickly move to five trucks per day with the ability to scale to as many as 10 trucks per day before we consider additional automation upgrades. Unfortunately, like any manufacturing process starting mass production, a downside to the initial production ramp-up is bill of materials cost that is higher due to smaller volume of material orders for limited production runs. Volume is the key objective to achieve the positive gross margin numbers we require. The mission is to get to the volume numbers for parts purchasing while building a limited number of units to demonstrate proof-of-performance and durability acceptance, ultimately enabling us to place substantially larger purchase orders knowing we have a fully vetted recipe. Our highly innovative and eagerly awaited C Series all electric delivery trucks with outstanding sales orders require parts from hundreds of suppliers. We have been engaged with key suppliers to negotiate the most effective parts pricing, which again, is a volume issue. We have encouraged substantial non-recurring engineering charges that are required as part of the tooling, fixtures and supply chain set up for the parts required. As you might imagine, millions of dollars of NRE has been spent since March 2019 to get our current C Series suite of products engineered and for the testing and certification process. While many parts of the current limited production run for the C Series are common to other OEM parts, at our initial production output we are paying low volume pricing while demonstrating proof-of-performance. Once our final parts are confirmed, our engineers will then work with our suppliers to create our own tooling and parts numbers, so we can acquire these parts at the most efficient pricing enabling us to reach our margin goals. We're making steady progress in production, while also focusing on conserving capital and expanding our supply chain options while building the least number of early production vehicles as possible. We expect to move from our current limited production state to moderate production in Q2 2020 while hitting our stride into more steady state production prior to the end of the year. Our intent is to produce and deliver a limited number of vehicles to our customers in the second quarter and then move to higher volumes and deliveries with a target of delivering roughly 300 to 400 delivery trucks in 2020. In conclusion, I'll provide a brief comment as we always do with respect to the United States Postal Service next-generation delivery vehicle program. As many of you are well aware, under our NDA Workhorse is only able to provide information which is already in the public domain. As has been the case throughout this process, any further information or announcements will be issued by the United States Postal Service. We appreciate the continued interest we receive, and we will provide updates to the market as we are able, however, we do not have any updates to share at this time. This concludes my prepared remarks. Thank you all for your time this morning. We look forward to updating you on our progress going forward. And we're now ready to open the call for your questions. Operator, please provide the appropriate instructions.

Thank you. Ladies and gentlemen, we will now be conducting the question-and-answer session. [Operator Instructions] Our first question comes from the line of Greg Lewis with BTIG. Please proceed with your question.

Yes, thank you and good morning everybody and congratulations on a busy few months. I guess Rob or Duane, you mentioned in the prepared remarks about the last standard that needs to be met in March before you can kind of start ramping up production. Just kind of curious, how we should think about that? Is that going to be impacted by travel bans or anything or is that any kind of color you could give around that I think would be helpful just as this seems like the last piece of the puzzle.

Sure, this is Rob Willison. The last -- excuse me, the last test that we're doing is a seatbelt pull test validation. It's being conducted currently in Indiana, will be completed at the end of this month or by the end of this month. There was some logistics to getting the vehicle out there but we don't anticipate any issues with it but that is the last of the FMBSS test.

Okay, perfect. And then, Duane, you mentioned the two trucks a day up to 5 to 10, and thanks for the guidance of 300 to 400 units this year. I guess what I would be wondering is what do you see as potential hurdles, if any to sort of -- kind of hit that guidance range?

Yes. Like any other type of hurdles in this business from a supply chain perspective, making sure that we have all of our suppliers in alignment with the actual number of units that they need to have in there few, and in their scheduled to deliver us timely. We are effectively trying to do as much as possible as we can, again, to conserve capital and so on with; I'll call it just in time parts and so on. So we don't have a backlog if you will or a shelf full of parts that we can pull-off to build trucks; so we're really dependent on working very closely with our supply chain to have a continual flow of parts coming into meet the number of units that we plan to deliver going forward.

Okay, great. And then, just a follow-up -- just to piggyback on that; you kind of mentioned the two trucks a day. I guess, thinking about it a little differently, what type of run rate do you think maybe we could see in the fourth quarter in terms of units per month? Like, how should I be thinking about that just as I think about what maybe 2021 could look like? What that exit rate in 2020 will look like?

Greg, this is Steve Schrader. I think the way I would frame it is to some extent is, when you talk about the capacity you're talking more about what we have the ability to do at the plant from an assembly standpoint, that's not really the issue. I think it's more thinking about any kind of production, somebody going from R&D or equipment and putting installing equipment going to mass production. And it certainly is -- you have to kind of ramp it up slowly; so I think you expect the -- the first quarter and the second quarter will be a lot smaller quantities and will be back loaded towards the fourth quarter in the 300 to 400. And then, thinking about steady state; I think what we see from a standpoint to and -- is we have basically -- we think 200 a month, it will be kind of steady state production, that kind of gets us to gross margins that you would expect an OEM to have and also profitable state.

Okay, great. Perfect. And then, just one more from me on the LMC timeline. I guess you received the $12 million net income this quarter. I guess as we think about the rollout of that truck; I mean, how -- any kind of guidance you can give around other potential income maybe this year? How you're thinking about additional cash being monetized from those licensing fees?

Yes, Greg, again, it's Steve. I think LMC being a private company part of the investment and the value comes from when they actually raise more money, as well as some of the fees that we get. So, I think we don't anticipate in 2020 that we'll receive any kind of fees for the most part, unless they have a big capital raise which will get 1% of that. So, but -- and it's all dependent on when they actually sell the truck too, so some of these other fees going forward from a cash standpoint. And the investment obviously changes when they raise more money at different values.

All right, thank you very much of time.

Thank you. Our next question comes from Jeff Osborne with Cowen. Please proceed with your question.

Yes, thanks guys. I appreciate all the detail on the call. Just a couple of quick ones on my end. Steve, can you talk about what the volumes would need to be per quarter to get to gross margin positive? I'm just trying to triangulate the two OE capacity to 200 a month being the ultimate destination. What sort of bridges the gap to get to breakeven gross margins, is that possible with the guidance that you just gave for the fourth quarter run rate, for example?

It wouldn't be in the fourth quarter. Most likely, I think we have to get to the 200 a month or 600 a quarter to get kind of the gross margins that you expect a breakeven kind of profitable situation.

That's gross margin breakeven, not net income breakeven. I wasn't sure which breakeven?

No, that's the gross margin. That's actually -- our target is 15% to 20% gross margin, very similar to other OEMs, so it's more be at 15%, 20% gross margin rate. And then, that will make us profitable too at that 200 a month kind of rate -- 600 a quarter.

Got it. So I was trying to get to, what -- do you have any sense of what the volume will need to be to be a gross margin of zero?

I think when you look at -- again, I think this year is kind of where most companies when they go from -- again, R&D or building capital and going for mass production, what you're trying to do is get to that gross margin positive. We think at a 100 a month, we think we're pretty close to gross margin positive.

Okay, that's helpful. And then, can you just give us a sense of that -- you mentioned a credit facility that you were pursuing; two part question around that. One, can you give us a sense of scope in potential rates on that? And then, also any sense of what the CapEx needs are of the company to move from 2 to 5 to 10 per week? It sounds like there is some costs involved, so I didn't know what the CapEx budget was for the guidance that you just provided.

I think what Duane said on the CapEx budget is, it's only above 10 that we actually would need CapEx. So I think from that standpoint, we don't need to really any additional CapEx this year, regarding that the assembly plant. From a standpoint of the capital that we're looking for and the facility we're looking for, probably be in the range of $40 million facility, a credit revolver. I'm not sure that we would need all that initially, obviously, but that's kind of the range. Interest rates, obviously, we're still talking to parties and we'll figure out kind of where that -- where that will be at.

Got it. And then is there any sense -- sort of three different interrelated topics here, but can you give us a sense of the UPS order book where that stands? Where the Duke relationship -- is that going to be -- I assume UPS is the initial customer receiving the deliveries; will that be using the Duke facility or not? Anything you can share about the order book more broadly post the show last week as well, would be helpful.

Yes. This is. Duane, and I appreciate the question, Jeff. Yes, so as you know, UPS being our customer of record for the last several years, they have 1,060 units on order that we are beginning to deliver in anticipation in late Q2 or Q3 this year, followed by a couple of other customers with some simultaneous deliveries that include DHL, Ryder and anticipating additional customers that we are expecting to close in short order, not just from the NTA show but other work that we've been doing, leading up to this point of production. So we have clearly a number of prospects in the queue that we think we can flip to closed orders pretty quickly. With that said, to your question about -- I guess timelines, again, this all goes towards building out to that 100 to 200 units a month where we have a consistent run rate going into 2021 so that we can reach those gross margin positive numbers as well as maintain and increase the run rate from month to month. But UPS is clearly still, an all important customer to us because they have the highest volume currently, and we expect that they will continue to be excited by the trucks that we're delivering. The feedback we've received from them from the early pilot reviews has gone quite well and given us good constructive feedback for how we can configure these vehicles with additional options that all net-net involved, collision mitigation type features, as well as configurable battery packs; the different things that we've designed, the truck to be able to do so that we can offer them trucks in a more configurable and dynamic mode, so they even -- they fit better on each individual route based on the duty cycle for that route.

Makes sense. And then, the Duke part of the question. Duane, are you going to be using their involvement that you had press release maybe six to nine months ago at all or no?

Yes, I think the Duke partnership is very helpful from a standpoint of customers and they may want to have a battery leasing as an option, and also from a standpoint of the infrastructure. So, we're currently -- we're working with customers right now, they're dealing with their infrastructure and waiting for delivery of trucks from that standpoint with Duke. So that is another important relationship we have.

It's interesting, Jeff, and I'll elaborate a little bit, is that we as part of the process. We're introducing our customers to Duke, if you will, from the perspective of building out, infrastructure battery leasing and so on. So it's a direct relationship between Duke and that customer of ours, but all three of us working together in terms of how that meets with delivery needs. The number of units going to which locations etcetera, so it's progressing forward as we anticipated.

That's good to hear. Last question I had for you, Steve, is just a housekeeping one. I'm sure it's in the 10-K but I missed it in the press release today. Do you happen to have the share count?

I think it's -- I don't know if I have the exact amount. I think it's 70 million or so.

Got it.

71.

71. All right, thank you.

Thank you. [Operator Instructions] Our next question comes from the line of Jay Burnham with Armory Advisors. Please proceed with your question.

Yes, hi guys. A quick question on the senior secured convertible note. I see that there is a mandatory conversion provisions in there where you're required to convert a certain amount of it by February 1 and a certain amount by April 1. Can you go over where you stand with those conversions?

Yes, we'll decide kind of whether we convert those or not. When we do convert them, they're going to be converted for stock. We also have the option to kind of make those conversions later as a catch-up in other quarter as well.

So am I reading the provisions incorrectly because they're called mandatory provisions, and it says you're required to convert 2.5 million principal amount by February 1 and 5 million by April 1?

Yes. We've done the 5 million already, that things converted.

Okay. That's my question.

Okay. Sorry [indiscernible] purpose of that.

Thanks. And then, on the Lordstown Investment. How much will you have that value debt [ph] on your 12/31 balance sheet?

It's 12.2. It's already valued out there. It's in the balance sheet on the press release.

Got you. Thank you.

Thank you. At this time, this concludes the company's question-and-answer session. If your question was not taken, you may contact Workhorse's Investor Relations team at wkhs@gatewayir.com. I'd now like to turn the call back over to Mr. Hughes for his closing remarks.

Well, thank you everyone for joining us on today's call. I especially want to thank our employees, partners and our all-important investors for their continued support. We appreciate your continued interest in Workhorse and look forward to updating you on our next call. Operator?

Thank you for joining us today for Workhorse Group's fourth quarter and full year 2019 earnings conference call. You may now disconnect.