Mr. Stephen King reports

NFI PROVIDES UPDATE ON ITS COMPREHENSIVE REFINANCING PLAN, INCLUDING THE FINALIZATION OF INDICATIVE TERMS FOR A $200 MILLION SECOND LIEN FINANCING, AND ANNOUNCES PRELIMINARY SECOND QUARTER 2023 RESULTS

NFI Group Inc. today provided an update on the expected timing to complete its previously announced comprehensive refinancing plan. The company has also finalized indicative terms for a $200-million second lien debt financing, and has provided preliminary second quarter 2023 financial results, with full financial results to be released on Aug. 16, 2023.

Refinancing plan update

The company expects to concurrently close all elements of the refinancing plan prior to Aug. 31, 2023 (previously Aug. 2, 2023). Additional time is required to document and complete the second lien debt and finalize all closing procedures of the mutually conditional transactions included within the refinancing plan.

To support the updated timing, NFI has requested, among other things, an extension of the date for the completion of the required amendments and the financial covenant waivers under the company's existing North American senior secured credit facility and its United Kingdom senior secured credit facility to Aug. 31, 2023. NFI anticipates that it will receive the requested relief prior to July 31, 2023.

To date, under the refinancing plan NFI has:

• Received confirmation of credit approval from its banking partners for proposed amendments to the secured facilities with revised maturity dates extending to April 30, 2026;
• Secured $225-million of equity commitments through a combination of a private placement transaction, which was approved by shareholders on June 27, 2023, and for which regulatory approvals have been received, and a bought deal public offering of subscription receipts to be exchanged for common shares of NFI on completion of the refinancing plan;
• Received confirmation of intention to extend the maturity of Manitoba Development Corp.'s and Export Development Canada's senior unsecured debt facilities to April 30, 2026, with both facilities extensions subject to final approvals and documentation;
• Finalized indicative terms for a planned $200-million second lien debt financing.

As all the financing transactions described above are mutually conditional, the company expects to close all elements of the refinancing plan at the same time prior to Aug. 31, 2023.

Second lien debt

The indicative terms for the second lien debt include an annual coupon at the higher end of the previously disclosed expected range of 12 per cent to 15 cent, payable semi-annually, with a maturity of five years.

The second lien debt financing is expected to be completed with a group of investors and expected to be closed concurrently with the other components of the refinancing plan, prior to Aug. 31, 2023.

The second lien debt will be senior secured second lien obligations of NFI and its material subsidiaries, which will rank behind the secured facilities and all other first lien secured indebtedness of NFI and such subsidiaries, rank ahead of any subordinated obligations of NFI and its subsidiaries, and, by virtue of being secured, rank ahead of any unsecured obligations.

The second lien debt financing is subject to negotiation of binding documentation. It is possible that the terms relating to the second lien debt financing described herein could change as the documentation is finalized.

Preliminary second quarter 2023 results

To provide the necessary time to finalize its financial results, NFI has changed the planned release of its second quarter 2023 results from Aug. 2, 2023, to Aug. 16, 2023.

For the second quarter of 2023, NFI expects that the financial results will reflect the following:

• Revenue of $640-million to $660-million;
• Adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $10-million to $12-million;
• Net loss of $48-million to $52-million, representing a net loss of 62 cents to 67 cents per share and expected adjusted net loss per share of 45 cents to 50 cents;
• An ending backlog of over 9,800 EUs with an expected value of more than $6.6-billion.

The expected year-over-year revenue and adjusted EBITDA growth are primarily driven by higher vehicle deliveries and aftermarket volumes.

While NFI finalizes its refinancing plan, which is expected to significantly improve NFI's liquidity position, the company remains focused on cash management and liquidity. The company is executing on efforts to reduce inventory and accelerate customer payments, including the pursuit of advance payments and deposits from customers, wherever possible, and exploring other potential opportunities to generate cash flows.

At the end of the second quarter, NFI had elevated bus and coach inventory levels as certain vehicles were impacted by supply related disruption, and there were some delivery delays associated with select battery-electric vehicles. In addition, accounts receivable balances were temporarily elevated stemming from quarterly deliveries and buses going through customer acceptance programs. NFI expects significant cash inflows during the third quarter as these temporary working capital balances are converted to cash.

Based on the strength of its firm and option backlog, growing order book, first quarter results and expected second quarter results, plus a planned increase in production rates during the second half of 2023, NFI reaffirms its full year 2023 financial guidance, including an expected $30-million to $60-million of adjusted EBITDA. Please see the company's March 1, 2023, press release and the 2022 management's discussion and analysis for details on the assumptions that drive 2023 financial guidance, as well as certain applicable risks.

The company cautions that the figures presented above are preliminary, unaudited and subject to change as management completes its quarter-end financial procedures. NFI will release its second quarter 2023 financial results on Wednesday, Aug. 16, 2023, prior to market open. A conference call for analysts and interested listeners will be held on Aug. 16, 2023, from 8:30 a.m. Eastern Time (ET) until approximately 9:30 a.m. ET. An accompanying results presentation will be available prior to market open on Aug. 16, 2023, at the NFI website.

For attendees who wish to join by webcast, registration is not required; the event can be accessed on-line. NFI encourages attendees to join via webcast as the results presentation will be presented and users can also submit questions to management through the platform.

Attendees who wish to join by phone must preregister on-line. An e-mail will be sent to the user's registered e-mail address, which will provide the call-in details. Due to the possibility of e-mails being held up in spam filters, the company highly recommends that attendees wishing to join via phone register ahead of time to ensure receipt of their access details.

A replay of the call will be accessible from about 12 p.m. ET on Aug. 16, 2023, until 11:59 p.m. ET on Aug. 16, 2024. The replay will also be available on NFI's website.

About NFI Group Inc.

Leveraging 450 years of combined experience, NFI is leading the electrification of mass mobility around the world. With zero-emission buses and coaches, infrastructure, and technology, NFI meets today's urban demands for scalable smart mobility solutions. Together, NFI is enabling more livable cities through connected, clean and sustainable transportation. With 7,700 team members in 10 countries, NFI is a leading global bus manufacturer of mass mobility solutions under the brands New Flyer (heavy-duty transit buses), MCI (motor coaches), Alexander Dennis (single- and double-deck buses), Plaxton (motor coaches), Arboc (low-floor cutaway and medium-duty buses) and NFI Parts. NFI currently offers the widest range of sustainable drive systems available, including zero-emission electric (trolley, battery and fuel cell), natural gas, electric hybrid and clean diesel. In total, NFI supports its installed base of over 100,000 buses and coaches around the world. NFI's common shares trade on the Toronto Stock Exchange under the symbol NFI and its convertible unsecured debentures trade on the TSX under the symbol NFI.DB.

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