Gothenburg, Sweden, November 8, 2023–(BUSINESS WIRE)–Polestar Automotive Holding UK PLC (Nasdaq: PSNY), the Swedish electric performance car brand, today aims to accelerate margin improvement and significantly reduce the company's total capital needs. announced a strengthened business plan. Cash flow break-even point in 2025.
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Polestar 2, Polestar 3, Polestar 4, Polestar 5 (Photo: Business Wire)
In light of the rapidly changing operating environment, Polestar has introduced an enhanced business plan that resets the company's path to profitability by prioritizing profit growth over volume. Polestar is targeting total annual sales of approximately 155,000 to 165,000 units in fiscal 2025 and gross profit in the high teens. This is expected to be achieved through a richer product mix with four models in production, a reduced cost structure and a refocused approach to key markets, including a new joint venture in China and measures to improve the profitability of the U.S. business. has been done. Polestar has already implemented the cost reduction measures announced earlier this year, primarily through headcount reductions, and continues to pursue aggressive cost management efforts.
Polestar CEO Thomas Ingenrath said: “We have taken the necessary steps to rethink our business plan to reduce costs and improve efficiency, making Polestar a more resilient and profitable company. “and at the same time reduce demand for capital.''
“Achieving cash flow breakeven already in 2025 will demonstrate the strength of our asset-light business model. Being more profit-oriented is our way forward.”
Demonstrating their continued commitment to Polestar, Geely Holding and Volvo Cars provided additional liquidity to the company. Pursuant to an amendment to the existing shareholder term loan, Volvo Cars will extend the maturity of the outstanding term loan by more than three years to June 2027 and provide additional financing facilities totaling $200 million with the same maturity date, totaling provided additional financing facilities of $200 million. The investment amount will reach $1 billion. In addition, Geely Swedish Automotive Investment AB (an affiliate of Geely Holding) has made available a $250 million term loan on substantially the same terms as Volvo Cars, including a June 2027 maturity. There is.
Both loans come with an optional equity conversion feature.
Based on an enhanced business plan and reduced funding needs from new and existing financing and liquidity support from Geely Holding and Volvo Cars, Polestar is targeting cash flow breakeven in 2025. It is estimated that approximately $1.3 billion in external funding will be required to achieve this goal.
Polestar is working with its major shareholders to keep a comprehensive financing plan on track to provide the remaining funding needed, including additional debt and equity.
Polestar management will host a live audio webcast today, November 8, 2023 at 14:00 PT (17:00 ET or 23:00 CET). A live audio webcast is available at https://investors.polestar.com/events/event-details/q323-results-webcast.
A replay will be available at https://investors.polestar.com/ following completion of the conference call.
Note: Polestar Day, a technology and innovation event, will be held in Los Angeles on November 9th. Detailed keynote and technology highlights will be published on the Investor Relations website in the coming days.
About Polestar
Polestar (NASDAQ: PSNY) is a Swedish electric performance car brand determined to improve society by leveraging design and technology to accelerate the transition to sustainable mobility. Headquartered in Gothenburg, Sweden, the company's cars are available online in 27 markets around the world in North America, Europe and Asia Pacific. The company plans to develop a truly climate-neutral production vehicle with no offsets by 2030.
Polestar 2 was launched in 2019 as an electric performance fastback with an avant-garde Scandinavian design and up to 350 kW. Polestar 3 was launched in late 2022 as his SUV for the electric age. It is a large, high-performance SUV that offers sports car dynamics with a low stance and spacious interior. Polestar plans to release three more electric performance vehicles by 2026.
Forward-looking statements
Certain statements in this press release (the “Press Release”) may be deemed “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995. Forward-looking statements generally relate to future events or our future financial or operating results. Polestar including vehicle deliveries and gross profit. For example, statements regarding projections of revenue, volumes, margins, cash flow break-even points, other financial or operating metrics, and projections of future financing needs and related plans are forward-looking statements. Words used in some cases include “may,” “should,” “anticipate,” “intend,” “will,” “estimate,” “anticipate,” “believe,” and “anticipate.” You may identify forward-looking statements by terminology such as ''. , “potential,” “anticipate,” “plan,” “seek,” “future,” “suggestion,” “continue,” or the negative of these terms, variations thereof, or similar terms. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. there is.
These forward-looking statements are based on estimates and assumptions that, while believed by Polestar and its management to be reasonable, are in some cases inherently uncertain. Factors that could cause actual results to differ materially from current expectations include, but are not limited to: (1) Polestar's ability to maintain agreements or partnerships and develop new products with strategic partners, such as Volvo Cars, Geely and Kokichi Mizu Group; Agreement or Partnership. (2) maintain relationships with existing suppliers, source new suppliers of critical components, enter into long-term supply agreements, and develop supply chains while effectively managing the risks arising from such relationships; Polestar's ability to complete. (3) Polestar relies on partnerships with vehicle charging networks to provide vehicle charging solutions and relies on strategic partners to service vehicles and their integrated software; (4) Polestar has limited experience with electric vehicles in mass producing vehicles, developing devices, products, apps and operating systems for Polestar, and allocating sufficient production capacity and resources to Polestar; You may be dependent on your partner. To enable Polestar to expand its vehicle production capacity and product offering. (5) achieve profitable growth and management, including expectations of growth and financial performance, by generating expected revenues at expected selling prices, maintaining customer relationships and retaining management and key employees; Polestar ability. (6) Polestar's estimates of expenses, profitability, gross margin, cash flows and cash reserves; (7) increased costs, interruptions or shortages in the supply of materials, particularly for lithium-ion batteries and semiconductors; (8) the possibility that Polestar will be adversely affected by other economic, business and/or competitive factors; (9) the impact of competition and high barriers to entry in the automotive industry and the pace and depth of electric vehicle adoption on Polestar's future business generally; (10) changes in regulatory requirements, government incentives, fuel and energy prices; (11) the outcome of any legal proceeding that may be brought against Polestar or others, any adverse outcome from litigation, governmental investigations or audits, or tax-related proceedings or audits; (12) ability to meet stock exchange listing standards; (13) changes in applicable laws and regulations or government incentive programs; (14) Polestar's ability to build its brand and gain additional market share; (15) risks related to negative publicity and reputational damage, including lithium-ion battery cell fires and smoke emissions; (65) delays in the design, development, manufacture, launch and financing of Polestar's vehicles and other products and Polestar's dependence on a limited number of vehicle models to generate revenues; (16) Polestar's ability to continually and rapidly innovate, develop and market new products; (17) risks related to future market adoption of Polestar's products; (18) risks related to Polestar's sales model; (19) the global coronavirus pandemic, inflation, changes in interest rates, ongoing conflicts in Ukraine and Russia, Israel and the Gaza Strip, supply chain disruptions, fuel and energy prices, and changes in Polestar; the impact of logistical constraints, Polestar's expected results of operations, financial performance or other financial and operating metrics or any of the risks described above; (20) Polestar's ability to predict demand for its vehicles; (21) Polestar's ability to obtain additional financing; (22) Polestar's ability to successfully implement cost reduction activities and strategic efficiency initiatives; (and (23) the other risks and uncertainties described in the sections entitled “Risk Factors” and “Cautionary Note Regarding Forward-Looking Statements” in Polestar's Form 20-F, and how: Other Documents Filed or to be Filed with the SEC by Pollstar There may be additional risks that are not currently known to Pollstar or that Pollstar currently believes are not material. may cause actual results to differ from those contained in the forward-looking statements.
Nothing in this press release shall be deemed a representation that the forward-looking statements contained herein will be achieved or that the results contemplated by such forward-looking statements will be achieved. should not be. You should not place undue reliance on forward-looking statements, which speak only as of the date on which they are made. Polestar undertakes no obligation to update these forward-looking statements, even if new information becomes available in the future, except as required by law.
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contact address
Bojana Flint
Head of Investor Relations
bojana.flint@polestar.com
Theo Kjellberg
Corporate Communications Manager
theo.kjellberg@polestar.com
Tanya Ridd
Global Head of Communications and PR
Tanya.ridd@polestar.com
