CMI - Westport Fuel Systems - FY2022 Is Going To Be Ugly

• Discussing mediocre fourth quarter results. Supply chain disruptions and contractual pricing reductions caused consolidated gross margin to deteriorate by 300 basis points sequentially.
• Going forward, results will be impacted from the recent conclusion of the highly profitable Cummins Westport joint venture.
• Company likely to see a material impact from the ongoing Russia-Ukraine conflict with an estimated $25 million in annual sales currently in limbo.
• Elevated prices for gaseous fuels have resulted in lower demand for the company's products.
• Given estimated cash usage of up to $70 million this year, it's difficult to see the company avoiding another capital raise going forward. Investors should remain on the sidelines until the current overhang has lifted.

For further details see: