SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 6-K
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REPORT OF FOREIGN PRIVATE ISSUER PURSUANT TO RULE 13a-16 OR
15d-16
UNDER THE SECURITIES EXCHANGE ACT OF 1934
Dated March 9, 2023
Commission File Number: 001-40286
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Arrival
(Exact Name of Registrant as Specified in Its Charter)
____________________
Grand Duchy of Luxembourg
(Jurisdiction of Incorporation or Organization)
60a, rue des Bruyeres, L-1274 Howald,
Grand Duchy of Luxembourg
(Address of Principal Executive Offices)
____________________
Indicate by check mark whether the registrant files or will file
annual reports under cover Form 20-F or Form 40-F.
Form 20-F ☒ Form 40-F ☐
THIS REPORT ON FORM 6-K SHALL BE DEEMED TO BE INCORPORATED BY
REFERENCE IN EACH OF THE REGISTRATION STATEMENTS ON FORM F-3 (FILE
NO. 333-254885, FILE NO. 333-266472 AND FILE NO. 333-270019) AND
THE REGISTRATION STATEMENT ON FORM S-8 (FILE NO. 333-259673) OF
ARRIVAL AND TO BE A PART THEREOF FROM THE DATE ON WHICH THIS REPORT
IS FURNISHED, TO THE EXTENT NOT SUPERSEDED BY DOCUMENTS OR REPORTS
SUBSEQUENTLY FILED OR FURNISHED.
INFORMATION CONTAINED IN THIS FORM 6-K REPORT
On March 9, 2023, Arrival (the “Company”) issued a press release
announcing the Q4 Earnings. A copy of the press release is
furnished as Exhibit 99.1 to this report on Form 6-K.
Exhibit Index
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Exhibit Number |
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Exhibit
Title |
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99.1 |
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Press Release issued by Arrival on March 9, 2023
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the registrant has duly caused this Report to be signed on
its behalf by the undersigned, thereunto duly
authorized.
ARRIVAL
By
/s/ John Wozniak
Name: John Wozniak
Title: Chief Financial Officer
Dated: March 9, 2023
Exhibit 99.1
Arrival’s Preliminary Fourth Quarter and Full Year 2022 Financial
Results
Ended Q4 with $205 Million of Cash on Hand
Business Update will be held Monday, March 13, 2022 at 4:30
P.M.
Luxembourg, March 9, 2023
- Arrival (NASDAQ: ARVL),
inventor of a unique new method of design and production of
electric vehicles (EVs) by local Microfactories, today reported
preliminary financial results for the fourth quarter and full year
ended December 31, 2022.
The Company will conduct its business update webinar after markets
close on Monday, March 13, 2023 at 4:30 P.M. Eastern Time. The
business update is being held at that time to allow the Company to
potentially finalize a transaction which, if consummated, would
provide additional liquidity and further extend its runway.
The link to register for the webinar can be found at
investors.arrival.com under Events.
Fourth Quarter 2022 Preliminary Unaudited Financial
Results
•Loss
for Q4 of $588 - $597 million, compared to a loss of $67 million in
the fourth quarter of 2021. This loss in Q4 2022 includes non-cash
impairment charges and write-offs of approximately $406
million.
•Adjusted
EBITDA loss for the fourth quarter of $162 - $172 million, compared
to an adjusted EBITDA loss of $85 million in the fourth quarter of
2021. The increase quarter over quarter is due to an increase in
the amount of salaries and contractor costs not capitalized in Q4
2022 vs Q4 2021 of approximately $70 million and an increase in
parts and subassemblies spend of approximately $25 million offset
by a non-recurring listing fee of approximately $20 million in the
fourth quarter 2021.
•Administrative
expenses in Q4 of approximately $133 million and non-capitalized
R&D expenses of approximately $31 million, compared to
administrative expenses of $43 million and non-capitalized R&D
expenses of $28 million in the fourth quarter of 2021.
•Capital
expenditure for the quarter, including tangible and intangible
purchases, of $25 million, compared to $104 million in the fourth
quarter of 2021. Capital expenditure for intangible and tangible
assets decreased by $42 million and $37 million
respectively.
•In
Q4, the cash balance reduced by $126 million to $205 million.
Primary uses of cash were related to working capital spend of $104
million, repayment on interest on loans and lease liabilities of
$11 million, capex spend and other operational
expenses.
•Cash
and cash equivalents were approximately $205 million as of December
31, 2022.
•Shares
outstanding totaled 638,050,175 and weighted average shares
outstanding in Q4 totaled 631,256,324 as of December 31,
2022.
Full Year 2022 Preliminary Unaudited Financial Results
•Expected
Loss for the year of $998 - $1,008 million compared to a loss of
$1,304 million in 2021. The full-year 2021 loss includes a one-time
non-cash charge of $1,205 million1
(€1.0 billion) associated with the merger of Arrival and
CIIG.
•Expected
adjusted EBITDA loss for the year of $379 - $380 million, compared
to an adjusted EBITDA loss of $203 million in 2021. The increase
year over year is due to an increase in the amount of salaries and
contractor costs not capitalized in 2022 compared to 2021 of
approximately $102 million and an increase in parts and
subassemblies spend of approximately $38 million.
•Expected
capital expenditure, including tangible and intangible purchases,
for the year of $245 million, compared to $291 million in
2021.
Preliminary Financial Data
The preliminary financial information included in this release is
subject to completion of Arrival’s year-end close procedures and
further financial review. As a result, the preliminary results
reflect Arrival’s preliminary estimate with respect to such
information, based on information currently available to
management, and may differ from Arrival’s actual financial results
as of and for the quarter and full year ended December 31, 2022.
These preliminary estimates should not be viewed as a substitute
for full financial statements prepared in accordance with
International Financial Reporting Standards (“IFRS”), and they
should not be viewed as indicative of our results for any future
period.
Webcast Information
Arrival will host a Zoom webinar at 4:30 P.M. Eastern Time on
Monday, March 13, 2023, to discuss its fourth quarter and full year
2022 financial results and business update. The live webcast will
be accessible on the Company’s website at
investors.arrival.com.
A webcast replay will be available approximately two hours after
the conclusion of the live event.
Non-IFRS Financial Measures
This press release includes Adjusted EBITDA which Arrival utilizes
to assess the financial performance of its business that is not a
measure recognized under IFRS. This non-IFRS measure should not be
considered an alternative to performance measures determined in
accordance with IFRS and may not be comparable to similar measures
presented by other issuers. “Adjusted EBITDA” represents earnings
before interest, tax, depreciation and amortization, adjusted for
impairment of intangible assets and financial assets, share option
expenses, listing expenses, fair value adjustments on Warrants,
reversal of difference between fair value and nominal value of
loans that got settled during the period, fair value movement of
embedded derivative, realized and unrealized foreign exchange
gains/losses and transaction bonuses. For a reconciliation of
Adjusted EBITDA to Operating loss, see the reconciliation table
included later in this press release.
About Arrival
Arrival’s mission is to master a radically more efficient New
Method to design, produce, sell and service best-ever electric
vehicles, to support a world where cities are free from fossil fuel
vehicles. Arrival’s in-house technologies enable a unique approach
to producing vehicles using rapidly-scalable, local Microfactories.
Arrival (NASDAQ: ARVL) is a joint stock company governed by
Luxembourg law.
Forward-looking statements
This press release refers to a potential transaction which is
currently under negotiation. There can be no assurance that such
transaction can be entered into or consummated on any particular
timetable or at all.
Statements regarding such potential transaction are made pursuant
to the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995.
Media Contacts For Arrival
Media
pr@arrival.com
Investors
ir@arrival.com
1
Exchange rate for the years ended December 2021 based on average
daily EUR/USD 0.8458 from January 1, 2021 to December 31,
2021
Preliminary Reconciliation of Net Loss to Non-IFRS
measures
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in thousands of US$ |
Twelve months ended December 31, 2022 |
Twelve months ended December 31, 2021 |
Three months ended December 31, 2022 |
Three months ended December 31, 2021 |
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High |
Low |
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High |
Low |
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(Loss) for the period |
(1,007,608) |
(997,847) |
(1,304,381) |
(597,333) |
(587,572) |
(66,519) |
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Interest expense/ (income), net |
15,748 |
15,748 |
141 |
417 |
417 |
4,544 |
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Tax expense/ (income) |
648 |
648 |
7,515 |
(3,182) |
(3,182) |
(1,074) |
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Depreciation and amortization |
59,793 |
59,793 |
24,337 |
26,350 |
26,350 |
7,623 |
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EBITDA |
(931,419) |
(921,658) |
(1,272,388) |
(573,748) |
(563,987) |
(55,426) |
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Impairment losses and write-offs
(7)
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693,649 |
685,201 |
39,378 |
405,438 |
405,677 |
36,934 |
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Share option expense |
2,045 |
2,045 |
2,668 |
(8,180) |
(8,180) |
(949) |
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Listing expense
(1)
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— |
— |
1,168,515 |
— |
— |
(19,820) |
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Fair value of warrants including intrinsic value of warrants
redeemed and
outstanding
(2)
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(3,460) |
(3,460) |
(122,299) |
(78) |
(78) |
(5,692) |
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Fair value movement of embedded derivative
(5)
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(118,480) |
(118,480) |
(35,448) |
(4,680) |
(4,680) |
(35,448) |
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Fair value movements on employee loans including changes in
estimates re repayment dates
(4)
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11,861 |
11,861 |
6,038 |
5,865 |
5,865 |
(5) |
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Reversal of difference between fair value and nominal value of
loans that got repaid/ settled
(3)
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(295) |
(295) |
(1,906) |
— |
— |
(1,906) |
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Foreign exchange (gain)/loss, net |
(33,809) |
(33,809) |
(2,328) |
3,225 |
3,225 |
(1,218) |
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Transaction bonuses
(6)
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— |
— |
14,900 |
— |
— |
(1,162) |
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Adjusted EBITDA |
(379,908) |
(378,595) |
(202,870) |
(172,158) |
(162,158) |
(84,692) |
Note: The results for the twelve months to December 31, 2022
reflects the analysis of change in presentational currency. Prior
year figures
have also been restated into US$
I(thousands).
(1) During the prior period ended December 31, 2021, as a result of
the conclusion of the merger with CIIG, Arrival issued shares and
warrants to CIIG shareholders, comprised of the fair value of the
Company’s shares that were issued to CIIG shareholders, and in
exchange, the Company received the identifiable net assets held by
CIIG. The excess of the fair value of the equity instruments issued
over the fair value of the identified net assets received,
represents a non-cash expense in accordance with IFRS 2. This
one-time non-cash charge as a result of the transaction, in the
amount of
€1.0 billion (c.$1,205 million),
is recognized as a share listing expense presented as part of the
operating results within the consolidated statement of profit or
loss. Listing expense also includes USD $19.8 million of other
related transaction expenses.
(2) Warrants are fair valued as of the balance sheet date. The
change in value is recorded in the consolidated statement of profit
or loss.
(3) Employee loans initially recognized at their fair value are
amortized over the period in which they are expected to be repaid.
Employee loans, which get repaid/settled at an earlier date than
what was initially anticipated results in gain in the consolidated
statement of profit or loss.
(4)The Group has re-financed some loans given to employees in April
2022. As per IFRS 9 the the difference between the fair value of
the new loans and the carrying amount has been recognized in the
consolidated statement of profit or loss
(5) An embedded derivative is a component of a hybrid contract that
also includes a non-derivative host. The Company has recognised the
embedded derivative as part of the convertible notes issued in
November 2021 which is fair valued as at balance sheet date for the
twelve months ended December 31, 2022.
(6) Following the successful merger with CIIG certain executive
officers of the Group received a one time bonus. This is included
in administrative expenses in the consolidated statement of profit
or loss in the prior period of twelve months ended December 31,
2021.
(7) Impairment losses and write-offs include internally developed
intangible assets, tangible assets impaired as a result of business
reorganization and write-offs of aged batteries cells and related
prepayments, impairment for lease locations no longer utilized by
the Group and impairment on assets as a result of stopping
operations in Russia.
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