Shortly after Westport Innovations Inc.'s second quarter earnings came out Wednesday, the company announced plans to raise equity. Except details weren't provided. Westport simply said the issue will fall under its base shelf prospectus.
On a conference call shortly after that announcement, chief executive officer David Demers did his best to explain the decision to confused analysts.
"It's an awkward statement, but we just thought it was fair to our shareholders to tell them that we are considering this," he said. He then confirmed that no timelines have been established and there isn't a target amount in mind.
That's pretty unusual. Typically, when a company posts strong quarterly profits, it will issue equity right away to take advantage of the attention. But Mr. Demers said the company simply wanted to give a little notice. "There are lot of prospective partners now and things are moving really quickly, and we just wanted to give our shareholders a heads-up before things got a little too exuberant."
He also said Westport isn't in dire need of more money right now, almost contradicting the need to raise equity. "Our existing business is well funded; it's not as though we're about to go run out of cash," he said.
Tim Kiladze