LONDON - In a significant move towards sustainable transportation, Tembo E-LV B.V., a subsidiary of VivoPower International PLC (NASDAQ:VVPR), has entered into a definitive partnership agreement with Sarao Motors, a leading jeepney manufacturer in the Philippines. This collaboration is set to introduce electric jeepneys, aiming to modernize the iconic Filipino public transport vehicle while reducing carbon emissions.
The partnership will see Tembo providing Sarao with electric jeepney kits, with deliveries already underway to Sarao's headquarters in Las Piñas City, Metro Manila. Sarao Motors, established in 1953, is renowned for its colorful and ornate jeepneys, a cultural symbol in the Philippines. The company also boasts the largest dedicated jeepney facility in the country.
Edgardo 'Ed' Sarao, Vice President of Sarao Motors, expressed enthusiasm for the initiative, which is expected to create local jobs and opportunities while preserving the jeepney's cultural heritage. Leonard John 'LJ' Sarao, Operations Supervisor at Sarao Motors, highlighted the environmental benefits and performance improvements anticipated with the electric powertrain.
VivoPower's CEO, Kevin Chin, emphasized the partnership's alignment with the company's commitment to people, planet, and profit. He pointed out the opportunity to create jobs and maintain traditional jeepney craftsmanship while integrating modern electric vehicle technologies.
The electric jeepney program spearheaded by Tembo and VivoPower aims to support the Philippine jeepney industry's transition to a cleaner and more sustainable future. This initiative not only seeks to enhance the environmental profile of public transportation in the Philippines but also to preserve the aesthetic and cultural significance of the jeepney.
The information for this article is based on a press release statement.
In other recent news, VivoPower International PLC has made significant strides in its strategic initiatives. The company recently completed a $4 million stock offering, primarily aimed at reducing debt and funding inventory to fulfill customer orders. The offering was managed by Chardan and was part of VivoPower's shift to a capital light business model.
Additionally, VivoPower announced a merger plan with Future Automotive Solutions and Technologies (FAST), a move aimed at leveraging the UK's clean energy initiatives. The proposed merger values the combined entity at $1.13 billion, with VivoPower and FAST shareholders owning 49% and 51% respectively.
On the financial front, VivoPower reported a 22% year-on-year decline in annual consolidated revenue to $11.8 million for the fiscal year ending June 30, 2024. Despite the revenue drop, gross profit from continuing operations increased to $1.6 million, up from a $2.3 million gross loss in the previous year. The company also reported an underlying net after-tax loss of $25.1 million.
In other developments, VivoPower's subsidiary, Tembo E-LV, and Cactus (NYSE:WHD) Acquisition Corp. 1 Limited agreed on a business combination valuing the combined enterprise at $904 million. If completed, this merger will result in Tembo becoming a separately listed company on NASDAQ, with VivoPower expected to remain the majority shareholder.
These recent developments are part of VivoPower's strategic shift towards Electric Vehicle and Sustainable Energy Solutions, as evidenced by the sale of Kenshaw Electrical, a Critical Power business unit, for approximately A$5.0 million.
InvestingPro Insights
While VivoPower International PLC (NASDAQ:VVPR) is making strides in sustainable transportation with its electric jeepney initiative in the Philippines, recent financial data from InvestingPro paints a challenging picture for the company.
According to InvestingPro data, VivoPower's revenue for the last twelve months as of Q2 2024 stood at $12.24 million, with a concerning revenue growth decline of -38.18% over the same period. This decline in revenue could potentially impact the company's ability to fund its innovative projects like the electric jeepney program.
InvestingPro Tips highlight that VivoPower "operates with a significant debt burden" and "may have trouble making interest payments on debt." These factors could pose challenges for the company as it seeks to expand its electric vehicle initiatives in emerging markets.
On a more positive note, one InvestingPro Tip suggests that "analysts anticipate sales growth in the current year." This projection aligns with the potential success of partnerships like the one with Sarao Motors, which could drive future revenue growth for VivoPower.
It's worth noting that VivoPower's stock has faced significant headwinds recently. The company's share price has fallen by 77.41% over the past year, and it's currently trading near its 52-week low. These market performance indicators suggest that investors may be cautious about the company's near-term prospects despite its innovative projects.
For investors seeking a more comprehensive analysis, InvestingPro offers 19 additional tips for VivoPower, providing a deeper understanding of the company's financial health and market position.
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