Delivering Innovative Transportation Solutions TSX.V: BUS JUNE 2016

Transcription

1 Delivering Innovative Transportation Solutions TSX.V: BUS JUNE 2016

2 This presentation contains ''forward-looking statements'', which reflect the expectations of management regarding Grande West Transportation Group Inc. s (the Company ) future growth, results of operations, performance and business prospects and opportunities. The words ''believes'', ''anticipates'', ''plans'', ''expects'', ''intends'', ''projects'', ''estimates'' and similar expressions are intended to identify forwardlooking statements. These forward-looking statements reflect management's current expectations regarding future events and operating performance and speak only as of the date of this presentation. Such forward-looking statements are based on a number of material factors and assumptions, including, but not limited in any manner to the availability of sufficient working capital to market the Company's products and provide aftersales maintenance and support services to the Company's customers, access to adequate services and supplies to operate the Company's business, economic conditions, commodity prices, foreign currency exchange rates, interest rates, access to capital and debt markets and associated costs of funds, availability of a qualified work force, and the ultimate ability to develop, manufacture and sell the Company's products on economically favourable terms. Forward-looking statements involve significant risks and uncertainties, should not be read as guarantees of future performance or results, and will not necessarily be accurate indications of whether or not or the times at or by which such performance or results will be achieved. A number of factors could cause actual results to differ materially from the results discussed in the forward-looking statements, including, but not limited to, the factors discussed under ''Risk Factors'' in the Company prospectus dated November 27, 2013 and which will be detailed from time to time in the Company s interim and annual financial statements and management s discussion and analysis of those statements, all of which are or will be available for review on SEDAR at Although the Company has attempted to identify important factors that could cause actual performance to differ materially from that described in forward-looking statements there may be other factors that cause its performance not to be as anticipated. These forward-looking statements relate only to events or information as of the date on which the statements are made. The Company neither intends nor assumes any obligation to update these forward-looking statements or information to reflect changes in assumptions or circumstances other than required by law. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those currently anticipated. Accordingly, readers should not place undue reliance on forward-looking statements. Disclaimer This presentation does not form part of any offer of securities, or constitute a solicitation of any offer to purchase or subscribe for securities. The sole purpose of this presentation, in paper or electronic form, is strictly for information.

3 Global Manufacturing for cost efficiency Local support for best in class reliability Built to meet the tough North American operating environment

4 The Start The Future Design & Engineering Secured Manufacturing Manufacturing CMVSS Certification Pilot Bus Testing Sales in Canada Hired leading industry experts Grew market share Built brand name Enter US Market FMVSS Certification ALTOONA TESTING Secured major contracts

5 Passengers: 24 Costly to Operate, 5 year life cycle. Poor Access. Built on a light Duty Truck Chassis 30 ft 40 Monocoque, Big bus Technology, Compact platform Lowest Operating Costs, Lower Capital Costs Right Size your fleet with Vicinity Buses ft 40 ft 33% Higher Fuel Costs 40 % Higher Capital Cost Higher Maintenance Costs 40 ft Buses operate with min passengers after peak rush times 5

6 Bus Type Approximate Yearly Sales Dollar Value (USD) School Bus ~ 30,000 35, B Cutaways ~ 15,000 18, B Medium Duty ~ 1, M Heavy Duty ~ 5,200-5,500 3 B Motor Coach ~ 2,000 2, B

7 Bus Type Approximate Yearly Sales Plan Target Sales (units) School Bus ~ 30,000 35,000 - N/A / Future Potential Cutaways ~ 15,000 18,000 - Easy Target - Average 5 year life span / Vicinity 12 years - Replace High End cutaways with Vicinity 500 Medium Duty ~ 1,000 - Eldorado is #1 competitor - Vicinity superior product at lower price 400 Heavy Duty ~ 5,200-5,500 - Target right sizing transit fleet - Minimum 10% of fleet is for overage/contingency * Offer 40ft model for Motor Coach ~ 2,000 2,500 - Select orders - Many transit systems offer Motor Coach for highway operations - Vicinity designed Hwy operation for 60mph 100 Annual Total: 1,200

8 Excellent Value, Lowest Manufacturing Costs Superior quality components More standard features Best warranty in the industry Excellent product performance & after sales support Correct Timing, Right Product, Right Price Vicinity continues to win every Canadian competitive tender

9 - High Quality proven components - Outsourced manufacturing: No factory costs No work in progress No monthly manufacturing fixed costs - Lower operational costs - Less capital requirements - Quicker delivery times = High Value / Lower cost of goods = Higher profits / Highly competitive product = Gain of market share

10 Need for mid-size bus Political budget constraints High customer expectations Aging population Demand Rising costs The Vicinity offers Government and Transit operators The ability to save 40 % in operational costs for every 40 ft bus it can right size Most operators have % spare vehicles in the fleet

11 Canadian Government is strongly committed to deliver a long-term infrastructure plan to develop transformative and modern transit projects over the next 10 years Federal Government is dedicated to invest in transit infrastructure $3.4 billion CDN budget pledge over the next 3 years Additional funding to modernize public transit systems Up to 50% Government funding for eligible project costs Over the last 2 years Grande West has cultivated and developed its position with all transit authorities across the country. It will now see continued firm repeated orders

12 108 buses back log Altoona Testing with best in class results Signed long term outsourced manufacturing agreement Structured for major growth Developed Canadian market

13 Fundamentals are strong o Strong sales momentum o Stable industry o Big growth opportunity o Exciting new products o Revenue M booked o Not difficult to understand o Few competitors o High barrier to entry o High future growth with exit strategy Timing is right o More investors starting to get interested o Pre-booked sales o Trading below analysts' projections o Additional analysts looking at picking up coverage Experienced and committed management team

14 Number of Vicinity buses sold Revenues $21,000 $52,500 $105,000 Cost of sales $19,200 $45,000 $87,000 Gross Profit $1,800 $7,500 $18,000 9% 14% 17% Expenses, Marketing & Overhead $3,000 $4,000 $5,500 EBITDA ($1,200) $3,500 $12,500 7% 12% Note: Parts Sales projections not included Industry standards: Parts Sales equate to 25% of total revenues and average 40 % profit *(in 000's of CDN$)

15 $18,000,000 $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $ Q Q Q Q4 Revenues Profit Net Income

16 Total Issued Shares 1 51,571,344 Stock Options 2 4,108,400 Broker Options 3 188,601 Warrants 4 6,360,397 Conversion of Debentures 5 7,529,412 Fully Diluted Shares 69,758,154 Notes: 1. Includes 45% insider ownership 2. Average exercise price $ Average exercise price $ Average exercise price $ A) Unsecured $1,320,000, 8% coupon, 5year, $0.33 strike B) Unsecured $1,200,000, 8% coupon, 5year, $0.68 strike C) Unsecured $1,200,000, 8% coupon, 2year, $0.68 strike On December 18, 2015, the Company issued 2,848,935 units at $0.62 per unit for total proceeds of $1,766,340 by way of a brokered private placement. Each unit is comprised of one common share and one-half of one transferrable common share purchase warrant of the Company On March 19, 2015, the Company closed an additional brokered private placement of 618,000 equity units of the Company at a price of $0.25 per Unit for total proceeds of $154,500 On March 12, 2015, the Company completed a financing of a private placement for gross proceeds of $2,678,750. The placement consisted of 2,000,000 non-brokered and 4,315,000 brokered equity units at a price of $0.25 per Unit for total proceeds of $1,578,750 On October 20, 2014, the Company completed a financing of a brokered private placement consisting of 785,500 units at a price of $0.50 per Unit, for gross proceeds of $392,750.

17 Growth & Shareholder Value Offer Canadian and US operators the industry s best buses, services and value with the lowest Total Cost of Ownership. Operate as world class OEM using LEAN principles. Be recognized as a world class manufacturer. Produce a high quality product, that customers, company and shareholders can be proud of.

18 William Trainer President & CEO 25 years of business leadership with extensive import and export experience Successfully pioneered and brought new products to Canada from Asia for 20 years Owned and managed heavy construction dealerships across Western Canada Extensive knowledge in business dealing with major manufacturers throughout Asia John Wang Vice President, Chief Engineer Accredited Mechanical Design Engineer, previous positions as senior mechanical and designer engineer and project manager for major corporation in Canada and China Extensive knowledge of the import and export manufacturing and Chinese business practices Jean-Marc Landry Vice President, Business Development Senior manager with over 20 years of experience in business development, focused on the public transit industry, former head of Sales for Nova Bus Instrumental in growing Nova Bus sales from 15% market share to over 50% in Canada then focused on fast tracking Nova s growth in the U.S.A. Aaron Triplett CFO Former CFO of Angkor Gold Corp. a Company listed on the TSX Venture and Senior Manager of a mid-size accounting firm specializing in the audit of public companies Chartered Accountant (CA) with Bachelor of Business Administration in Accounting from Thompson Rivers University

19 Joe Miller - Director & Chairman Global businessman with over 30 years in the construction field Manages a large diverse construction company in the Greater Vancouver area with projects across North America Brings vast knowledge in negotiation skills and customer relationship building Yves Devin - Director Former CEO of Montreal Transit System, second largest transit system in Canada Instrumental in improving Montreal Transit System to win the APTA award for being the Best Managed Transit Operation in North America Mr. Devin serves or has served on every major transportation association in Canada and the USA Andrew Imanse - Director Former President of the Thor Bus Group Instrumental in developing the bus market for Thor Industries Provides a wealth of manufacturing and marketing experience William Trainer - Director

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