#17: Earnings Call, Heilbronn Falcons, TFCA
Happy Sunday! While we still have to get rid of the Easter eggs and roast or tofu balls, Sono used the Easter Holiday (and the weeks before) to prepare and present the first figures since IPO, as well as the annual report, the sustainability report, and an outlook to 2022. Well over two hundred pages.
With big money from the IPO also comes big responsibility.
+++ EXECUTIVE SUMMARY +++
As expected, Sono made a loss in 2021 due to the investment in vehicle development, and that won't change until the Sion is delivered. The loss was on target, and the outlook is on target as well, which came across well. No bad surprises are good news in the current environment, and Sono knows how to deal with crises.
"Business Insider" asks, "Only 16,000 euros in sales: why is Sono Motors worth half a billion?". We know the answer: 17,000 real reservations, 900 fully paid, Valmet as the contract manufacturer who builds the car - and conviction at work from the entire team.
https://www.businessinsider.de/gruenderszene/automotive-mobility/sono-motors-geschaeftszahlen-2021/
+++ ANNUAL REPORT AND EARNINGS CALL +++
Numbers are a dry thing - but important. The report and earnings call is to occur when a public company publicly announces the financial figures for a given period. Analysts and shareholders are particularly interested in them. Shareholders can also expect an Annual General Meeting in 2022.
In Form "20-F", the Annual Report 2021 is presented. Find the info (annual reports and quarterly reports) on Sono's IR (investor relationship) page.
Management holds the quarterly earnings call digitally. This time it was Laurin, Torsten, and Thomas. Fun Fact: over 96.6 million share movements with Sono took place on Nasdaq on Tuesday - more than Tesla shares traded (!) on the day.
The entire 20-F (Annual Report 2021) is quite long, so a summary in PowerPoint has been provided. Here are some insights, most of which we already know; a picture of the final Sion is not in there; that's what we were looking for first.
"Solar business continues to grow while generating revenue." - "While Generating Revenue" sounds good; € 16,000 was in 2021. This caused some surprise because the sum sounds quite frugal given the investments.
Progress in series production. Here's a bit of new, slightly more concrete input for us, most of which we know here as well:
Valmet is a contract manufacturer for up to 257,000 Sions in 7 years. 1.7 million cars for premium OEMs like Daimler and Porsche have been built there so far at Valmet.
First deliveries of the Sion are planned for H2 2023
For the historians: The binding contract with Valmet was signed on April 5, 2022; we did not know the exact date yet.
The presentation also includes the P&L statement. It is noticeable that Sono is mainly investing in research and development - which is good.
Currently, a net loss is documented in the P&L. This is normal in this phase of a start-up. "No pain, no gain" Daria emphasizes in the YouTube Explainer Video that it is always important to consider the overall context in which the company operates. If nothing is produced and first developed, there can be no revenue yet. Every production-intensive start-up, from Lightyear to Tesla, knows this. Profits come later. "The stock market is not shocked by this. At Tesla, for example, self-generated gains (i.e., without the addition of CO2 certificates) have only been bubbling up since 2021.
The outlook in the presentation does not mention any concrete dates, but here the test drives are announced for mid-2022, and in addition, all suppliers of the Sion are to be finally determined and named in Q3. We thought everything should already be in place with the 37 SVC3/BIW, but one or two seem to be still missing.
There is still room for improvement with the Sono App, currently 150 vehicles registered. Because there is no Sion and no remote services, this is now more of a dry run.
Up to 300 million euros will be spent in 2022, so there is still money to be found.
Sono currently holds 44 million euros in reservation money (plus VAT). Iin case anyone like me is wondering why that's under 50 million - the reason is that VAT is included proportionally in our down payments.
The next report (earnings call) is already coming in May.
Sources: The PowerPoint with the summary:
https://ir.sonomotors.com/static-files/ff238e97-2f17-4740-b6e8-9df3db0712d3
Quarterly figures/press release
https://www.sec.gov/Archives/edgar/data/1840416/000117184322002645/exh_991.htm
20-F (the entire annual report, for the brave minds out there)
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001840416/000117184322002652/sev20211231_20f.htm
+++ QUESTIONS FROM THE EARNINGS CALL +++
Laurin, Torsten, and Thomas lead the analysts through the PowerPoint's most essential points. In the end, the financial experts could ask questions; here are some of them:
Do you want to raise the whole 275 million in one go or step by step?
Torsten: Rather not in one go, depending on which opportunities arise.
Quick question, you wrote that you reached 550 watts in one attempt, which is more than last time (450 watts). Do you have new cells, more efficient ones?
Thomas: No, we have only developed further and improved the software and components. That's part of the normal development on the way to the final vehicle.
The Sion will be more expensive for new reservers, do you already have reservations at the new price?
Thomas: We will update transparently
Sidenote: The homepage shows the reservation counter for the last month on the "About us," page. End of March it was at 17,097; we don’t know where we are now. Up to 18,500 reservations, the old price is still valid.
Here is the whole stream in the original:
https://edge.media-server.com/mmc/p/khxv99aw
+++ What is an "Earnings Call" +++
It was planned to explain the essential points from the report also in a video in German. Daria and Konstantin from the Sono finance team explain the what and why. I wanted to go through the numbers in detail in the video for the community; so much work went into the report. But figures are only available from management, and that's just fine. That's why there had been several takes in the video and it took four takes. Can’t help it…
Six years ago, Sono was planning on a beer mat. Everything had to be raised to a completely different professional level in a short time to get such a set of figures correct - under pressure from the auditors and the supervisory board (no sympathy at this point, the community advisory task is honorary, but the audit task in the supervisory board on behalf of the shareholders is remunerated). Sono mastered the exercise and got the audit certificate from PwC - and that probably went down well in the market. That is an outstanding achievement for a startup to shell out this quality at this point.
https://www.youtube.com/watch?v=zBzKKBgkBTI
+++ SUSTAINABILITY REPORT +++
The Sustainability Report 2021 comprises 60 pages and brings quite exciting insights into Sono. At Sono, for example, there are various working groups (called "circles" in the modern sense of the word) on different topics, such as the "Conflict Resolution Circle" in the event of stress among colleagues, the "Compensation Circle," which deals with fair compensation, and of course the Tactical Circle, which makes strategic decisions. Of the 12 members, the two under 30 are likely to be Laurin and Jona.
Incidentally, the cryptic abbreviations above the chapters ("GRI 102-44") are fixed categories to understand specific topics quickly. For example, GRI 302-1, -3 is energy consumption. GRI 102-44 is interesting; these are vital topics that can be different for each company.
Sustainability Report 2021 in English:
https://sonomotors.com/site/assets/files/7705/220406_sustainabilityreport2021_en.pdf
And general info:
https://sonomotors.com/de/nachhaltigkeit/
+++ PRESS REPORTS +++
The Augsburger Newspaper is known for good journalism and does not just copy press releases. Thanks to Carlo for sending it in.
+++ HEILBRONN FALCONS +++
Since this season, the Heilbronner Falken has worn the logo of Sono Motors on their back. And the best: Sono doesn't pay a cent for it. Get the full story here:
+++ TIME FOR CLIMATE ACTION +++
Sono is committed to climate action, and last week its homepage featured a special "Time To Act" page. TFCA aims to reach more than 50 million people and thus collectively implement more than 1 million concrete climate protection measures. Simple things that everyone can quickly implement for themselves to protect the environment.
https://www.tfca.earth/int/co/sono-motors
+++ FILL UP WITHOUT PAYING +++
The Ioniq 5 has a solar roof, and one user reports his experience. With the "small" roof, he estimates he gets 4 full charges per year, though he doesn't have summer readings yet. Note to European viewers: the decimal point is the thousands point, 18.903 is 18.9 kWh.
https://www.youtube.com/watch?v=lcYCRFd8yEw
+++ FUN FACT +++
Munich has the most e-cars on the road in absolute numbers, twice as many as Berlin. In percentage terms, Wolfsburg is ahead due to the corporate directive of Herbert Diess. He ordered his management team in 2019 to pick any e-car from the VW portfolio as a company car to find out first-hand where improvements are needed.
https://www.automobilwoche.de/agenturmeldungen/wolfsburg-liegt-vorn
Disclaimer because the topic of "stocks" was dropped: we are a humorous column here following Sono on the road to delivering the Sion and do not make stock recommendations. Everything we write here is based on public sources that are linked. Ratings are personal opinions.
Have a great week. Stay healthy.
Your Admins.