Westport to sell certain subsidiaries in Europe and Argentina

The company stated, “In addition, as disclosed in Westport (WPRT) Management Discussion & Analysis, for the year ended December 31, 2024, we continue to sustain operating losses and use cash to support our business activities. Cash provided by operating activities was $7.2 million for the year ended December 31, 2024 was primarily driven by reductions in working capital. As at December 31, 2024, we had cash and cash equivalents of $37.6 million and long-term debt of $33.7 million, of which $14.7 million was current. Based on our projected capital expenditures, debt servicing obligations and operating requirements under our current business plan, we are projecting that our cash and cash equivalents will not be sufficient to fund our operations through the next twelve months from the date of the issuance of this MD&A. These conditions raise substantial doubt about Westport’s ability continue as a going concern within one year after the date our December 31, 2024 Consolidated Financial Statements are issued. We plan to improve our liquidity position by selling certain subsidiaries in Europe and Argentina which comprise substantially all the assets and liabilities reported within the Light-Duty segment and continue our cost reduction initiatives. On March 30, 2025, we entered into a share purchase agreement with a wholly-owned investment vehicle of Heliaca Investments Cooperatief U.A, a Netherlands based investment firm supported by Ramphastos Investment Management B.V. a prominent Dutch venture capital and private equity firm, to sell all of the issued and outstanding shares of Westport Fuel Systems Italia S.r.l for a base purchase price of $73.1 million, subject to certain adjustments and potential earnouts of up to an estimated $6.5 million if certain conditions are achieved, in accordance with the terms of the Share Purchase Agreement. If we are successful in closing the sale, we will receive sufficient cash to fund our operations for the next twelve months and alleviate the risk of substantial doubt identified. As of the date of issuance of our December 31, 2024 financial statements, we are seeking shareholder approval of the plan to complete the sale of these businesses to the buyer. As such, there can be no assurances that Westport will be successful in obtaining sufficient funding. Accordingly, we concluded under the accounting standards that these plans do not alleviate the substantial doubt about Westport’s ability to continue as a going concern.”