Mr. David Johnson reports

WESTPORT FUEL SYSTEMS REPORTS THIRD QUARTER 2021 FINANCIAL RESULTS

Westport Fuel Systems Inc. has released financial results for the third quarter ended Sept. 30, 2021, and has provided an update on operations. All figures are in U.S. dollars unless otherwise stated.

Third quarter 2021 highlights:

• Revenues of $74.3-million, up 14 per cent compared with the same period in 2020, due to the continued recovery of sales volumes in the company's light-duty OEM (original equipment manufacturer) businesses since the beginning of the COVID-19 pandemic and $7.1-million revenue from the company's recently acquired fuel storage business, partially offset by the decrease in the independent aftermarket (IAM) business;
• Net loss of $5.8-million and net loss per share of three cents mainly due to increased operating expenses, lower government wage subsidy and support programs, and lower foreign exchange gain;
• Global supply chain challenges and the shortage of semiconductors adversely impacted growth of the company's HPDI sales, independent aftermarket business and delayed OEM businesses due to lower production compared with customer demand;
• Awarded the company's single-largest IAM tender bid of nine million euros for the supply of 60,000 LPG (liquefied petroleum gas) systems to Naftal, a branch of Sonatrach, the national Algerian oil and gas company;
• Published the company's annual ESG (environmental, social and governance) report, featuring 34.4-per-cent-lower overall GHG (greenhouse gas) emissions (tonnes of carbon dioxide equivalent) and reduced GHG intensity by 20.6 per cent year over year;
• Cartesian Capital Group debt converted into common shares of the company.

"While this was a challenging quarter for our company as we felt the larger effects of both the ongoing semiconductor shortage and global supply chain issues across key parts of our business, despite these challenges, market conditions for our company and the potential for our clean, affordable products remain positive, and we are still showing an improving trend in our business. Sales of our light-duty LPG and [compressed natural gas] components in Europe showed recovery over last year. We expect continued positive growth in Europe, as well as growth in emerging markets. The heavy-duty business remains fundamentally strong, and we anticipate a return to expected full-year growth trend when the semiconductor shortage challenges are resolved as market and customer feedback is positive. Demand for heavy-duty vehicles will continue to increase, and our HPDI technology, fuelled by [liquefied natural gas] and [renewable natural gas] today and next by green hydrogen, is in a key competitive position to expand as OEMs need to act to respond to environmental regulations and meet the demand for clean, efficient and affordable solutions. Our products will continue to play an important role in the immediate future towards overall carbon reduction in transportation and ensuring a clean and prosperous future for all," said David M. Johnson, chief executive officer.

Third quarter financial highlights operations

Revenues in third quarter 2021 increased 14 per cent to $74.3-million in the three months ended Sept. 30, 2021, resulting from higher sales volume and recovery in the company's light-duty OEM business and the addition of $7.1-million in revenue from the company's recently acquired fuel storage business, partially offset by the decrease in the IAM business.

Westport reported a net loss of $5.8-million for the quarter ended Sept. 30, 2021, compared with net income of $800,000 for the same quarter last year. The $6.6-million decrease in earnings was primarily the result of increases in research and development expenditures and general and administrative expenditures, lower foreign exchange gain, and increase in income tax expense compared with the prior quarter. Equity income from CWI was $1.0-million lower compared with the same prior-year quarter. Government wage subsidies and support programs received were also $900,000 lower compared with the same prior-year quarter.

Westport recorded negative $1.4-million adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) for the quarter ended Sept. 30, 2021, compared with $4.0-million. Adjusted EBITDA for the same period in 2020. This was due to increased R&D (research and development) spending and higher SG&A (selling, general and administrative) expenses.

Financial statements and management's discussion and analysis

To view Westport financials for the second quarter ended Sept. 30, 2021, please visit the company's website.

Live conference call and webcast

Westport has scheduled a conference call for Nov. 9, 2021, at 7 a.m. Pacific Time (10 a.m. Eastern Time), to discuss these results. To access the conference call by telephone, please dial 1-800-319-4610 (Canada and United States toll-free) or 604-638-5340. The live webcast of the conference call can be accessed through the Westport website.

Replay conference call and webcast

To access the conference call replay, please dial 1-800-319-6413 (Canada and United States toll-free) or 1-604-638-9010 using the passcode 7899. The telephone replay will be available until Nov. 16, 2021. The webcast will be archived on the Westport website, and replay will be available in streaming audio and a downloadable MP3 file.

About Westport Fuel Systems Inc.

Westport Fuel Systems is driving innovation to power a cleaner tomorrow. The company is a leading supplier of advanced fuel delivery components and systems for clean, low-carbon fuels such as natural gas, renewable natural gas, propane and hydrogen to the global automotive industry. Westport's technology delivers the performance and fuel efficiency required by transportation applications and the environmental benefits that address climate change and urban air quality challenges. Headquartered in Vancouver, Canada, with operations in Europe, Asia, North America and South America, the company serves customers in more than 70 countries with leading global transportation brands.

Condensed consolidated interim statements of operations and comprehensive income (loss)

(expressed in thousands of U.S. dollars, except share and per-share amounts)

We seek Safe Harbor.