BREA, Calif. - Mullen Automotive, Inc. (NASDAQ: NASDAQ:MULN), an emerging electric vehicle manufacturer, announced today that it has implemented significant cost reduction measures expected to decrease operating and investing cash flow expenses by around $170 million over the next 12 months, compared to the previous year's cash flows. The company reported operating and investing cash flows of $179 million and $108 million, respectively, for the 12 months ended September 30, 2023.
The cost-saving initiatives are part of Mullen's strategy to refine its business operations and focus on the commercial electric vehicle (EV) segment, which is seen as a potential driver of near-term revenue. In line with this focus, the company has set an objective to sell 100 units of Mullen Commercial EVs in April, following transactions in March, according to Brad Sigmon, Vice President of Randy Marion Automotive Fleet Operations.
The company's operational adjustments include prioritizing near-term revenue opportunities, curtailing noncommercial programs, integrating engineering centers in Troy and Irvine to build efficiency through consolidation, and expanding the national commercial dealer network.
David Michery, CEO and chairman of Mullen Automotive, expressed that the refined business operations are aimed at improving financial results and taking advantage of current market opportunities while also driving long-term growth and shareholder value.
Mullen Automotive, headquartered in Southern California, has two vehicle plants in the United States and began commercial vehicle production in Tunica, Mississippi, in August 2023. The company's commercial vehicles received IRS approval for federal EV tax credits and are California Air Resource Board (CARB) and EPA certified as of January 2024.
This news is based on a press release statement from Mullen Automotive, Inc.
InvestingPro Insights
In the wake of Mullen Automotive's recent announcement regarding cost reduction measures and a strategic shift towards the commercial EV segment, real-time data from InvestingPro provides a deeper financial perspective on the company's current standing. Notably, Mullen Automotive has a market capitalization of $26.21 million USD, which reflects the market's valuation of the company in light of its recent initiatives and market performance.
An InvestingPro Tip highlights that Mullen's management has been aggressively buying back shares, suggesting a belief in the company's value proposition and potential upside from the current levels. Additionally, Mullen holds more cash than debt on its balance sheet, providing it with a degree of financial flexibility as it navigates its strategic pivot.
From a valuation standpoint, the company is trading at a low Price / Book multiple of 0.12 as of the last twelve months ending Q1 2024, which could indicate that its assets are potentially undervalued by the market. However, the company's financial metrics also show significant challenges, with a negative gross profit margin of -458.51% in the same period, reflecting costs that substantially exceed revenues.
For investors looking for more detailed analysis and additional insights on Mullen Automotive, there are more InvestingPro Tips available, which can be accessed by visiting https://www.investing.com/pro/MULN. Be sure to use the coupon code PRONEWS24 to get an additional 10% off a yearly or biyearly Pro and Pro+ subscription, unlocking a wealth of data and expert analysis to inform your investment decisions.
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