Greetings. Welcome to the Workhorse Group's Fourth Quarter and Full Year 2024 Earnings Call. At this time, all participants will be in listen-only mode. A question-and-answer session will follow today's formal presentation. [Operator Instructions]. As a reminder, this conference is being recorded. At this time, I'll now turn the conference over to Stan March. Mr. March, you may begin.

Thank you, Rob. Good morning. We'd like to welcome all of you to Workhorse's 2024 results call. Before I begin, I'd like to note that we've posted our results for the year-ended December 31, 2024, via press release, as well as filed our 2024 10-K with the SEC this morning. You can find both of these documents and an accompanying presentation that will form the basis of today's conversation on this call in the Investor Relations section of our website. We'll be tracking along with the presentation during the call. Joining me on the call today are Rick Dauch, our CEO; and Bob Ginnan, our CFO. For today's agenda, please turn to Slide 3. Following my opening remarks, I'll hand it over to Rick, who will give you an update on our strategic and operational priorities throughout 2024. And Bob will then walk us through the financial results before discussing our continued actions to preserve cash and extend our financial runway. Then Rick will wrap us up before we open the call to questions. Our disclaimer can be found on Slide 4. Some of the comments that will be made today are forward-looking and are subject to certain provisions and are also subject to risks and uncertainties. You can find the full disclaimer in our 10-K, which again was filed this morning as well as in today's press release. I'll now turn the call over to Rick Dauch. Rick?

Thanks, Stan, and good morning, everyone. Thank you all for taking the time to join us today to discuss our 2024 results. Let's jump right into Slide 5. As we navigated 2024, and moved into 2025, it's clear that the landscape and pace of adoption for commercial EVs continues to shift. Recent regulatory pauses like the state of California withdrawing its waiver request to the EPA and a temporary freeze on federal fleet procurement have created tremendous uncertainty in the marketplace. Several fleets have paused or delayed their EV investment plans. Fortunately a few have not and several states continue to move forward with their plans to electrify their state funded fleets. Here at Workhorse, we did not build our business model around political cycles. We built it on designing, building, and selling great trucks with great people and with great business partners. What remains constant is that our vehicles, especially the W56 family of products are proving their value in real world operations in the last-mile delivery space. Beyond the numbers, drivers and owners are noticing the difference. The W56 offers smooth ride and acceleration, quiet handling and much better visibility, factors that improve safety and reduce driver fatigue, while also lowering operating costs. In the fourth quarter, based on direct customer feedback after multiple fleet demos, we launched the new W56 208-inch wheelbase truck in both strip chassis and step van variants as a longer wheelbase version of the initial W56. We have seen positive customer response to this new vehicle and have already received a purchase order for 13 of the 208-inch wheelbase step vans, which we expect to begin delivering in the second quarter of this year. We also received approval for the sale of our W750 and W56 step van models in Canada last month,…

Thanks, Rick. Let's turn to Slide 9 to cover our full year results. As a reminder, the 12/31/2024 financial statements have been adjusted for the March 2025 1-to-12.5 reverse stock split. Sales net of returns and allowances were $6.6 million for the full year 2024, compared to $13.1 million in 2023. The $6.5 million decrease in sales was primarily due to lower W4 CC truck sales compared to the same period a year ago, which was offset by an increase in W56 truck sales, service revenue generated from operating company Stables stalls and Workhorse routes, Drones As A Service before the Aero divestiture and other service revenue. Cost of sales for the full year 2024 was $28.2 million, a decrease of $9.5 million, compared to $38.4 million in 2023. The decrease in the cost of sales was primarily due to lower W4 CC vehicle sales, partially offset by higher W56 vehicle sales and additional service revenue. The decrease was further driven by cost saving initiatives including reduced employee costs of $3 million, improved inventory management resulting in a savings of $4.4 million, lower consulting expenses of $1.5 million, and lower freight expense of $1.4 million, partially offset by higher depreciation and amortization expenses of $3.1 million. SG&A expenses for the full year 2024 were $42.5 million, a decrease of $13.1 million, compared to $55.6 million in 2023. Lower SG&A expenses were primarily driven by $8.2 million decrease in employee compensation related expenses due to lower headcount, decrease of $2 million in consulting expenses, a decrease in legal and professional expenses of $1.7 million, a decrease of $1.2 million in marketing expense, a decrease in travel and entertainment expenses of $800,000, and lower corporate insurance of $600,000, partially offset by a $1.1 million increase in depreciation and IT related expenses. R&D…

Thanks, Bob. On Slide 12, you can see our priorities in our near-term priorities remain unchanged. We want to extend our financial runway, while advancing our product roadmap, and ramping up production while securing mortars for our commercial electric vehicles. We fully recognize the EV adoption in the commercial space is taking far longer than previously forecasted or expected by industry experts. External factors, regulatory delays, shifting incentives, the lack of adequate charging infrastructure and unpredictable political agendas have created significant headwinds and slowed the pace of EV adoption at even largest last-mile fleets and at the federal government level. But the fundamentals and business logic to transition to EVs in the last-mile delivery segment remain the same. Medium duty commercial EVs make sense. They typically service customers across the 50 to 100-mile route and return to duty station every day, leaving plenty of time to be recharged. On a few of our fleet demos, customers were only having to charge our vehicles 1 to 3 times per week. Workhorse is delivering a no compromise truck that drivers' love, one that just happens to be electric. It performs on the job, reduces total cost of ownership, provides a real return on investment and it eliminates emissions. We are fighting hard to secure breakthrough high volume orders with national fleets and we think we are close to doing so. Simultaneously, we are working on smaller orders with a high focus on the I-5 and I-95 corridors where states like California, Washington, New York and a few others have effective incentive programs are mandating that their own state-owned fleets start to adopt EV vehicles. As we look ahead to the rest of the year, we will continue to execute on our product roadmap and work diligently to gain momentum on the revenue side of the business. At the same time, we will make disciplined decisions to reduce costs, preserve our cash, and extend our financial runway. We look forward to providing updates as we make progress. Again, we have proven products that meet the needs of the last-mile fleets who have publicly committed to transition to zero emission vehicles. The question remains are these fleets truly still committed to that transition and when will they execute on their commitments and plans. Once again, thank you for your continued support and patience. With that, I'll open up the call for questions. Rob, can you take it over?

Thank you. At this time, I'd like to hand the floor back to Mr. Dauch for closing remarks.

No, that's it. I appreciate it. Those who are listening hang in there with us, we're doing our best and we'll work hard or secure those orders that we need, so we can build great trucks and start the transition to EVs. Thanks and have a great day. Bye.

Thank you. This does conclude today's teleconference. We thank you for your participation. You may now disconnect your lines at this time.