Westport Innovations Inc

WESTPORT INNOVATIONS INC.

Presented by: Simon Fraser University March 5, 2011 Content

2 Section Overview.……………………………………………… 1 Positive Drivers.....…………………………………. 2 Negative Drivers…….…………..………………….. 3 Valuation………….…………………………………… 4

TSE: WPT Overview

Report Price Target Price Positive Drivers

as of December 3, 2010 Negative Drivers $19.30 $16.38 Valuation

HOLD

 Formed in 1995, headquartered in Vancouver, Canada Overview  Over 400 patent applications worldwide with over 200 issued patents

 186 employees with 7 partners across the globe Positive Drivers

Negative Drivers

Valuation

Overview

Positive Drivers

Negative Drivers

Valuation

Juniper Engines Overview

Cummins-Westport Westport Positive Drivers Innovations Inc. Westport HD Negative Drivers Weichai-Westport

Valuation

Overview

Positive Drivers

Negative Drivers

Increase to Share Capital ($M) Valuation

150 100 50 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011

Overview

Positive Drivers

Partnerships Negative Drivers

Valuation

Management

Balance Economics Sheet

Delivered Transportation Fuel Prices, 2000-2035 Overview 4

Positive Drivers

3 Diesel fuel

Negative Drivers

2 Valuation 2008 USD 2008 Natural gas 1

History Projections 0 2000 2008 2015 2025 2035

10 USA China Overview

Positive Drivers Income tax credits for Consumer rebates for natural gas re-fuelling alternative fuel equipment vehicles. Negative Drivers

Excise tax credit to CNG Vehicles listed as Valuation seller of CNG or LNG encouraged industry

NAT GAS Act?

Overview Global Engine Global Truck

Producers Producers Positive Drivers

1. Weichai 1. Daimler Negative Drivers 2. Volvo 2. Volvo 3. Daimler 3. Dongfeng 4. Cummins 4. Tata Valuation 5. CNHTC 5. FAW

Overview

Positive Drivers

Negative Drivers

Valuation

Westport HD Diesel Overview Pmt Per month $4,000 $2,400 Maintenance Cost 0.115 0.085 Positive Drivers Per mile

Annual mileage 100,000 100,000 Negative Drivers Fuel Cost $2.10/DGE $3.60 Per month: Valuation Fuel (at 5 mpg) $3,500 $6,000 Lease charge 4,000 2,400 Operating charge 958 708 TOTAL $8,458 $9,108 Savings $650 / month

Overview

Executive Auto

Mining Positive Drivers

Politics

Startup Finance

John Beaulieu (Chairman) Negative Drivers David Demers (CEO)

William Larkin (CFO) Valuation Elaine A. Wong (EVP - Strategy) Nicholas C Sonntag (EVP – Marketing) Darren Seed (VP) Melih Ogmen (VP) W Chipman Johnston (Secretary)

Overview

Positive Drivers

Cash Negative Drivers ready Net for new Valuation Cash: ventures $73 M and Risk research averse Strong liquidity

Overview Enough Is there a fueling market? stations? More Positive Drivers reliable than Will diesel Negative Drivers companies What is the engines? adopt it? future of Westport? Valuation

Too expensive ?

Difficult to value

Overview

Price Positive Drivers

Negative Drivers

Psychology Valuation Reliability

Natural Gas Engine Diesel Engine Overview

Positive Drivers

Negative Drivers

Valuation  Double the price

 Less power and torque

 Requires special parts

 Requires more maintenance

Overview

Positive Drivers

Negative Drivers

Valuation

Source: DOE as of September 16, 2010

Overview

Positive Drivers

Negative Drivers

Valuation

Source: Westport

Overview $30 $16.38 $25 24.18 Positive Drivers

$20 Negative Drivers 17.31 16.81 17.40 $15 14.09 Valuation $10 9.37 7.16 $5 3.79 4.71 $0 P/S EV/S FCFF

Market Cap Overview Company Name EPS P/E P/S EV/Sales ($M)

Woodward Inc. 1.49 2,556.34 24.89x 1.75x 1.78x Positive Drivers Clean Energy Fuels Corp. -0.27 958.1 - 5.61x 5.17x

Fuel Systems Solutions Inc. 3.39 626.61 10.49x 1.23x 1.25x Negative Drivers China Automotive Systems Inc. 1.09 403.75 13.66x 1.23x 1.32x

Hydrogen Engine Center Inc. -0.11 2.42 - 1.78x 4.28x Valuation

3/5 Averages 909.45 16.35x 2.32x 2.76x Positive

Westport Innovations Inc. -17.88 903.96 - 6.26x 4.70x

450,000 Overview

400,000

350,000 Positive Drivers 300,000

250,000 Service revenue 200,000 Negative Drivers Parts revenue 150,000 Product revenue 100,000 Valuation 50,000

 CWI accounted for 92% of Westport’s total revenues in 2010

 Wildcard projects include Weichai-Westport, Volvo Powertrain

10,000 $35.00 Overview 9,000 $30.00 8,000 7,000 $25.00 Positive Drivers 6,000 $20.00 5,000 4,000 $15.00 3,000 $10.00 Negative Drivers 2,000 $5.00 1,000 - $0.00 Valuation

Units shipped Unit price

 Forecasted 20% annual growth in units shipped from 2011 – 2015

 Unit price growth driven by refocus on HD segment

Operating Cash Flow Overview 30,000

20,000 Positive Drivers

10,000

Negative Drivers 0 2006 2008 2010 2012e 2014e -10,000 Valuation -20,000

-30,000

 Operating cash flow to break-even by 2013

Overview Cost of equity 11.18% Cost of debt 8.10% WACC 11.10% Positive Drivers Terminal growth rate 2.00% PV of firm $ 658,187 Negative Drivers Add: Cash & equivalents $ 211,461

Less: Debt $ 23,656 Valuation PV of equity $ 851,239 Outstanding options 2,091 # shares outstanding 48,929 Intrinsic value $ 17.40

Cost of capital Overview 8.3% 11.1% 13.9%

1.5% 21.55 16.80 14.09 Positive Drivers Terminal 2.0% 22.76 17.40 14.45 growth 2.5% 24.18 18.07 14.84 Negative Drivers

Valuation Gross Margin 30.0% 35.0% 40.0% 15.0% 5.06 7.79 10.52 Growth 14.27 17.40 20.52 Stage CAGR 20.0% 25.0% 24.69 28.26 31.84

Disclaimer: This information is provided to you for informational purposes only and is intended Simon Fraser University | March, 2011 for use only by the Global Investment Research Challenge. Summary

28 - + Overview

Positive Drivers

High Degree Early to of Negative Drivers market Uncertainty

Valuation

Valuation Management

 Conclusion to NAT GAS Act Overview

 Broader Market Adoption of Natural Gas Positive Drivers Vehicles

Negative Drivers  Climbing price of oil

 Growth in Asia/ Weichai JV Valuation

Overview

Positive Drivers

Negative Drivers

Valuation

Simon Fraser University Beedie School of Business 500 Granville Street Vancouver, Canada Tel +1 (778) 782-5209

Disclaimer: This information is provided to you for informational purposes only and is intended Simon Fraser University | March, 2011 for use only by the Global Investment Research Challenge. 31 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Break R&D Costs Risk and IP Infrastructure Limits Technical Complexity Market Resistance High Uncertainty Negative Drivers Sound Sheet Balance Management Adapting Business Model Weichai Westport Inc. Strategic Partnerships Government Incentives Forecasted Fuel Prices Strong Foundation Positive Drivers Equity Financing JVs Partnershipsand Engine Technology Company Background Recommendation Overview Index of Slides - Even Point Segment Segment Analysis R&D Expense Cash RateBurn Key Ratios AnalysisFinancial DCF Assumptions Catalysts Investment Summary Sensitivity Analysis Net Investment Working Capital WACC Calculation Operating Cash Flow Operating Efficiency Gross Revenue Forecast Parts Revenue Product Revenue Revenue Growth Value Drivers FCFF Valuation Comparable Companies Valuations Margin External Risk Internal Risk Government Incentives Competitive Analysis Early Advantage Competitors US TruckMarket Going Green Partnerships Business Overview Management Compensation Management Board of Directors Other Statement Cash Flowsof Balance Sheet Income Statement Pro Forma Statements Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 32 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Investment Summary Risk Management Financial Alternative Engine Competition Industry Competition – Neutral + Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 33 Source: Team B Student Research StudentSource:B Team revenue Total Parts Product Service Parts revenue product sales % Previous 2 Product revenue Unit growth price Unit price Unit shipped growth Units shipped for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Revenue Forecast - years' 119,703 36,865 2011 E 2011 162,568 25.0% 6,000 26.55 4,509 2.0% 18% 15% 191,433 146,517 39,915 2012 E 2012 25.0% 27.08 5,411 5,000 2.0% 18% 20% 179,337 228,594 45,257 2013 E 2013 25.0% 4,000 27.62 6,493 2.0% 17% 20% 271,645 219,508 52,137 2014 E 2014 25.0% 28.17 7,792 2.0% 16% 20% 328,505 268,678 59,827 2015 E 2015 25.0% 28.74 9,350 2.0% 15% 20% 366,848 298,501 68,346 10,285 2016 E 2016 25.0% 29.02 1.0% 14% 10% 405,369 331,635 73,733 11,314 2017 E 2017 25.0% 29.31 1.0% 13% 10% 444,063 368,447 75,616 12,445 2018 E 2018 25.0% 29.61 1.0% 12% 10% Simon Fraser University | March, March, | 2011 UniversityFraser Simon 486,353 409,344 77,009 13,690 2019 E 2019 25.0% 29.90 1.0% 11% 10% 454,781 77,779 15,059 2020 532,561 10.0% 30.20 1.0% 10% 10% E

APPENDIX 34 $100,000 $20,000 $40,000 $60,000 $80,000 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Parts Revenue $0 Parts Revenue 10.0% 15.0% 20.0% 25.0% 30.0% 0.0% 5.0% Parts Revenue as % Previousof 2 Years’ Product Revenue Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 35 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Rolling 12 Month Basis $100,000 $120,000 $140,000 $160,000 $20,000 $40,000 $60,000 $80,000 $0 2009 Q1 2009 Q2 2009 Q3 Revenue 2009 Q4 2010 Q1 2010 Gross Margin Q2 2010 Q3 2010 Q4 2011 Q1 2011 Q2 10% 15% 20% 25% 30% 35% 40% 0% 5% Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 36 Source: TeamB Student Research for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Discount Rate Calculation WACC Cost of debt Cost of equity Risk premium Rf Beta Factor 11.10% 11.18% Rate 8.10% 5.00% 3.55% 1.53 Weight After taxinterest rate on most recentdebtoffering CalculatedusingCAPM Source Marketimplied risk Bank 10 of Canada Bloomberg risk : - adjusted Damodaran - adjusted5 by - yr bond as of yield1 Dec 2010 premium market (2010) Source - yr monthlybeta value of debt to equity Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 37 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information     DCF Assumptions Currency Risks Operational Risk Development Risk Commodity Price Risk      Unexpected changes in mineralogy Weather related permitting issues procurement delays development cost overruns Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 38 Source: Team B Student Research Student B Source: Team Presentvalue Discount factor Freecash flow firmto Less: Ex Cap working capital non Less:in Changes After - for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Discounted FCFF tax operating earnings earnings operating tax - Depreciation Depreciation - cash (13,748) (2,353) (7,015) 2011e 8,177 9,086 1.11 (13,292) (12,391) (1,185) 2012e 1,690 2,086 1.23 (16,991) (7,795) 2013e 6,908 9,473 (277) 1.37 (20,626) 12,968 19,758 2014e (579) 1.52 290 (25,464) 16,953 28,696 2015e 3,903 1.69 671 (17,454) 13,495 25,379 2016e 7,377 (548) 1.88 (17,661) 14,282 29,840 12,995 2017e 2.09 815 (17,891) 12,263 28,465 11,064 2018e 2.32 490 (19,652) Simon Fraser University | March, March, | 2011 UniversityFraser Simon 11,352 29,276 10,097 2019e 2.58 473 (14,723) 560,094 50,967 36,722 2020e 2.87 479

APPENDIX 39 liabilities Non Non Account Balances Source: Team B Student Research Student B Source: Team Prepaid Prepaid expenses Inventories Accounts receivable accrued accrued liabilities Warranty liability Deferred revenue Accounts payable and - - debt current cash current assets for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Schedule of Working Capital 12,877 15,416 10,833 18,216 2011 E 2011 1,657 1,567 15,163 18,357 12,900 21,450 2012 E 2012 1,880 1,973 15,540 25,614 18,107 22,114 2013 E 2013 2,254 2,377 21,517 26,747 18,796 30,437 2014 E 2014 2,875 2,703 26,021 32,346 22,730 36,809 2015 E 2015 3,477 3,242 29,058 36,121 25,383 41,105 2016 E 2016 3,883 3,887 32,109 39,914 28,048 45,421 2017 E 2017 4,291 4,662 35,174 43,724 30,726 49,757 2018 E 2018 4,700 5,591 38,524 47,888 33,652 54,495 2019 E 2019 Simon Fraser University | March, March, | 2011 UniversityFraser Simon 5,148 6,704 37,279 48,404 34,015 59,673 2020 E 2020 5,637 8,040

APPENDIX 40 Source: Team B Student Research Student B Source: Team PPE PPE Depreciation Capital Expenditure ∆Sales/Cap Ex for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Schedule of Net Investment 1,318 1,318 20 2011e 3,856 3,856 3,671 1,523 1,523 20 2012e 2,671 2,671 2,708 1,946 1,946 20 2013e 2,394 2,394 2,223 2,684 2,684 2,110 2,399 20 2014e 3,355 3,355 2,228 2,899 20 2015e 2,807 2,807 2,503 1,955 20 2016e 3,623 3,623 1,149 1,964 20 2017e 4,113 4,113 1,483 1,973 20 2018e 4,586 4,586 1,683 2,156 20 2019e Simon Fraser University | March, March, | 2011 UniversityFraser Simon 5,065 5,065 1,877 2,356 20 2020e

APPENDIX 41

2003 Return fromPrior Year for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Key Financial Ratios 2004

2005

2006

2007

2008

2009

2010 20% 40% 60% 80% 0% - - 40% 20% Debt Leverage Quick Ratio Current Ratio Liquidity Ratio Return onEquity Return onAssets Operation Efficiency Net Profit Margin Net Income (CAD) Gross Margin Revenues (CAD) Profitability Asset Turnover - Equity Equity Ratio 2008 34.6% 13.1% 14.4% 31.5% 0.91 - 10.3 71.5 1.7 1.5 1.8 - - - 2009 40.1% 18.0% 20.0% 25.3% 121.8 0.90 - 24.4 1.2 3.2 3.6 Simon Fraser University | March, March, | 2011 UniversityFraser Simon - - - 2010 44.3% 24.1% 28.8% 31.6% 130.7 0.84 - 37.6 0.8 4.5 4.8 - - -

APPENDIX 42 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Cash BurnRate Months Months of Burn Remaining Cash at 2010 Q2 Monthly Burn Rate Cash Outflow Add: Depreciation & Amortization Net Income Changes Changes in Non Other Non 2009 Q3 - Cash Cash Adjustments - Cash Cash Capital – 2010 Q2 Total - - 55.07 71.59 15.63 14.64 31.22 - 1.30 9.92 2.36 Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 43 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information 2010 2009 2008 2007 2006 2005 2004 2003 R&D Expense Expense 28.41 30.98 23.03 21.89 16.94 18.42 26.09 37.29 R&D Income ------16.86 26.21 37.72 48.51 37.64 24.43 10.32 11.31 Net Net Without Without R&D Net Net Income - - 12.71 10.58 - - 11.63 11.22 6.55 0.08 9.23 7.79 Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 44 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Segment Analysis Source: IANGV Worldwide Africa Latin America North America Europe Asia Region Figure 8.2.Natural Gas Vehicle - Pacific Growth by Region Average Growth Simon Fraser University | March, March, | 2011 UniversityFraser Simon 27.5% 19.2% 23.5% 15.8% 51.0% - 0.1%

APPENDIX 45 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Investment Risks Figure8.4. NaturalStation Gasin StateEach Source: Source: EIA Heavy Medium Light Sector Figure Figure 8.3. Incremental Engine Costs Over - duty (10 lb - duty (26 (26 duty lb +) (in (in thousand lb) - duty (14 lb – 14 lb) – (in (in $US) Diesel Diesel 26 lb) Extra Cost 60,000 40,000 17,000 Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 46 Normalized income Less: Abnormal gains (losses) Net income Income tax recovery(expense) Pretax income Interest expense EBIT (expense) Other non Interest income Foreign exchangegain (loss) Depreciationand amortization Sales marketingand Generaladministrative and Research developmentand Gross profit CoGS Revenues for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Income Statement - operatingincome (10,550) (23,026) (49,023) (20,974) (10,315) (14,788) (13,522) (1,266) (1,287) (1,550) (6,033) 10,659 22,513 71,536 4,473 5,095 1,316 2008 (38,700) (24,425) (17,904) (15,556) (15,071) (30,982) (91,020) 121,837 (6,521) (2,348) (1,978) (8,575) 14,275 30,817 9,033 1,882 (682) 2009 (40,608) (37,636) (28,741) (25,533) (18,102) (12,728) (28,411) (89,352) 130,712 (2,128) (8,895) (3,208) (5,559) 41,360 2,972 (348) 2010 383 (101,769) (18,230) (15,430) (28,979) (16,999) (16,999) (15,495) (12,814) 162,568 (1,504) (2,681) (8,591) (3,671) 60,799 2011e 1,713 (424) - (121,181) (21,911) (21,911) (19,676) (16,899) (29,436) (18,705) (29,559) 191,433 (2,235) (2,777) (9,857) (2,708) 70,251 2012e 3,538 (424) - (145,986) (18,361) (18,361) (18,361) (15,465) (11,123) (35,355) (22,675) (30,150) 228,594 (2,897) (2,223) 82,608 2013e 3,878 (424) - - (176,569) (12,389) (35,606) (27,488) (30,451) 271,645 (9,588) (9,588) (9,588) (9,012) (2,110) 95,076 2014e 3,956 (576) - - - (213,528) (13,655) (44,768) (33,322) (30,756) 114,977 328,505 (4,960) (4,960) (4,960) (4,343) (2,228) 2015e 5,409 (617) - - - (238,451) (14,921) (47,058) (40,395) (31,064) 128,397 366,848 (2,186) (2,186) (2,186) (1,527) (2,503) 2016e 6,017 (660) - - - (263,490) (16,187) (47,392) (48,969) (31,374) 141,879 405,369 (1,149) 2017e 3,709 3,709 3,709 4,415 7,607 (706) - - - (288,641) (17,453) (51,824) (59,363) (31,688) 155,422 444,063 (1,483) 2018e 1,483 1,483 1,483 2,239 8,628 (756) - - - Simon Fraser University | March, March, | 2011 UniversityFraser Simon (316,130) (18,719) (54,476) (71,963) (32,005) 170,224 486,353 (1,683) 2019e 1,118 9,741 (809) 309 309 309 - - - (319,536) (19,985) (54,862) (87,238) (32,325) 213,024 532,561 (1,877) 29,130 29,130 29,130 29,996 13,259 2020e (866) - - -

APPENDIX 47 Total Assets Total long Other long Future income tax assets Goodwill Intangible assets leaseholdimprovements Equipment, furnitureand Total Current assets Other current assets Prepaid expenses Inventories Loan receivable Accounts receivable Cash and cashequivalents Current assets for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Balance Sheet - - term assets term assets 78,940 27,379 18,754 51,561 22,762 4,366 3,685 4,944 1,033 9,020 6,774 7,028 2008 574 - 135,504 120,090 13,982 11,234 82,619 15,414 1,935 5,337 7,712 4,451 1,387 6,417 2009 430 - 145,477 105,851 156,117 10,640 13,505 11,570 4,144 6,209 5,069 1,307 8,175 2010 287 - - 284,606 262,292 211,461 22,313 10,833 15,146 18,216 2011e 5,069 1,567 4,144 8,665 5,648 3,856 - 271,448 251,449 192,116 19,998 12,900 18,035 21,450 2012e 4,144 8,665 4,518 2,671 5,069 1,880 - 280,690 262,098 191,894 18,592 15,540 21,727 25,614 2013e 4,144 8,665 3,389 2,394 5,069 2,254 - 293,491 275,740 192,455 17,752 18,796 26,279 30,437 2014e 4,144 8,665 2,259 2,684 5,069 2,703 - 326,725 309,431 209,803 17,294 22,730 31,779 36,809 2015e 4,144 8,665 1,130 3,355 5,069 3,242 - 361,582 345,965 235,032 15,616 25,383 35,489 41,105 2016e 4,144 8,665 2,807 5,069 3,887 - - 407,618 391,186 268,771 16,431 28,048 39,215 45,421 2017e 4,144 8,665 3,623 5,069 4,662 - - Simon Fraser University | March, March, | 2011 UniversityFraser Simon 456,184 439,262 305,162 16,922 30,726 42,958 49,757 2018e 4,144 8,665 4,113 5,069 5,591 - - 509,945 492,551 345,581 17,395 33,652 47,049 54,495 2019e 4,144 8,665 4,586 5,069 6,704 - -

APPENDIX 48 Total LiabilitiesandEquity Total Shareholders'equity comprehensiveincome Accumulated other Accumulated deficit Additionalcapitalpaidin Other equityinstruments Share capital Total liabilities Other long Long Warranty liability Total Current liabilities Obligationto issuewarrants liability Current portionof warranty term debt Current portionof long Short Demand instalmentloan Deferred revenue accrued liabilities Accounts andpayable Current Liabilities - - term debt term debt for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Balance Sheet - term liabilities - (247,460) 258,202 78,940 29,796 10,878 49,144 29,399 5,097 3,079 1,496 4,258 4,000 4,899 5,995 5,776 8,470 2008 205 54 8 (271,885) 135,504 311,855 60,958 12,319 74,546 11,353 12,369 33,400 12,222 14,359 3,406 5,263 4,821 1,614 4,642 2009 546 17 - (309,521) 156,117 376,710 84,895 12,293 71,222 12,936 30,472 12,082 13,902 5,260 5,271 9,199 3,295 2010 153 139 163 891 - (326,520) 284,606 183,715 492,529 100,891 12,293 36,977 10,717 43,744 12,467 14,003 15,416 2011e 5,260 9,452 1,657 153 200 - - (348,431) 271,448 161,804 492,529 109,644 12,293 51,906 12,762 35,257 14,845 18,357 2012e 5,260 9,720 1,973 153 81 - - - (366,792) 280,690 143,443 492,529 137,247 12,293 69,417 10,080 15,374 42,376 17,884 22,114 2013e 5,260 2,377 153 1 - - - (376,380) 293,491 133,855 492,529 159,637 12,293 89,789 18,595 51,253 21,630 26,747 2014e 5,260 2,875 153 - - - - - (381,340) 326,725 128,895 492,529 197,830 113,362 12,293 22,487 61,981 26,158 32,346 2015e 5,260 3,477 153 - - - - - (383,527) 361,582 126,708 492,529 234,873 140,547 12,293 25,112 69,215 29,211 36,121 2016e 5,260 3,883 153 - - - - - (379,818) 407,618 130,417 492,529 277,201 172,969 12,293 27,748 76,483 32,278 39,914 2017e 5,260 4,291 153 - - - - - (378,335) 456,184 131,900 492,529 324,285 210,104 Simon Fraser University | March, March, | 2011 UniversityFraser Simon 12,293 30,397 83,784 35,359 43,724 2018e 5,260 4,700 153 - - - - - (378,026) 509,945 132,208 492,529 377,737 252,682 12,293 33,292 91,763 38,727 47,888 2019e 5,260 5,148 153 - - - - -

APPENDIX 49 Items not involving cash Items not involving Loss for yearthe activities operating from Cash flows Other working capital Changesnon in net income jointventures from Joint VenturePartners' share of Depreciationamortization and for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Statement of CashFlows - cash operating (15,799) (14,393) (10,315) 1,795 5,564 1,550 2008 (24,425) (9,276) (7,399) 16,349 4,221 1,978 2009 (22,053) (37,636) 3,028 7,453 2,128 2,974 2010 (16,999) (3,857) (5,380) 2011e 6,261 8,591 3,671 (21,911) (1,078) 2012e 6,201 2,066 9,857 2,708 (18,361) 11,123 2013e 5,136 7,518 2,634 2,223 (9,588) 17,593 12,389 2014e 9,113 3,570 2,110 (4,960) 25,747 11,048 13,655 2015e 3,776 2,228 (2,186) 30,894 13,393 14,921 2016e 2,264 2,503 39,429 16,235 16,187 2017e 2,149 1,149 3,709 42,108 19,682 17,453 2018e 2,008 1,483 1,483 Simon Fraser University | March, March, | 2011 UniversityFraser Simon 46,666 23,859 18,719 2019e 2,096 1,683 309 80,887 28,923 19,985 29,130 2020e 1,877 972

APPENDIX 50 year Cash and cashequiv,ofend beginning ofyear Cash and cashequiv, equivalents Increase in cashand cash Other financingactivities Share issuance Long Short activities Cash flows from financing activities Cash flows from investing Other investingactivities Loan receivable Long improvements furnitureleaseholdand Purchase equipment,of - - - term debt term debt term investments for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Statement of CashFlows (6,774) (1,081) (6,814) 22,762 23,081 10,158 17,272 17,977 7,150 5,858 4,385 1,041 2008 - (16,365) (28,199) (9,259) (6,413) (1,641) (5,904) 82,619 22,762 25,602 51,243 53,024 13,891 19,379 2009 105,851 (4,218) (2,552) (4,789) 82,619 38,648 53,182 59,999 7,519 8,753 3,811 (256) 2010 (47) 211,461 105,851 105,610 112,426 115,819 (3,258) (2,960) (1,641) (1,318) 2011e (135) - - - (19,345) (13,855) (13,655) 192,116 211,461 (4,412) (2,889) (1,523) 2012e (200) - - - - 191,894 192,116 (5,638) (3,692) (1,946) 2013e (222) 280 280 - - - - - (10,081) (10,081) 192,455 191,894 (6,951) (4,552) (2,399) 2014e 562 - - - - - 209,803 192,455 (8,400) (5,501) (2,899) 17,347 2015e ------235,032 209,803 (5,664) (3,709) (1,955) 25,230 2016e ------268,771 235,032 (5,691) (3,726) (1,964) 33,738 2017e ------305,162 268,771 (5,716) (3,743) (1,973) 36,391 2018e ------Simon Fraser University | March, March, | 2011 UniversityFraser Simon 345,581 305,162 (6,248) (4,091) (2,156) 40,419 2019e ------419,642 345,581 (6,826) (4,470) (2,356) 74,061 2020e ------

APPENDIX 51 Johnston W Chipman Melih Ogmen DarrenSeed Sonntag Nicholas C Elaine A Wong Larkin William Edward David Demers John A Beaulieu Name for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Management Compensation Secretary Supply Chain Systems & VP: Fuel Comm Relations & VP: Investor Development Corporate Exec VP: Development Strategic Exec VP: CFO Founder CEO/Co Chairman Position - Mar Sep Sep Feb Oct Start WPT Date - - - - - 06 01 10 95 97 Compensation 449,271 584,997 495,124 246,154 805,313 246,154 Total Exerciseable Options 111,818 316,410 950,557 Unexercisable Simon Fraser University | March, March, | 2011 UniversityFraser Simon Options 181,038 581,168 639,296

APPENDIX 52 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Extensive Experience John Chairman Beaulieu, technologyfirms growth of more70than emerging in Experienced financing and assisting Board of Directors – Key Members Sara Liao of Hong Kong Environment, Transportand Works Former forSecretarythe Sau Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 53 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Extensive Experience M.A. Jill Bodkin Young Corporate Finance Partner Former Securities Commission, & Ernst Founding of Chair the British Columbia Board of Directors – Key Members Dezsö International Den Den Internationalof the year York University, AIB named Dean of Schulich J. Horváth School of Business, of Business, School Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 54 David R. Demers, CEO from physics and law,boardonof directors CEO since 1995, background both in for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Extensive Experience Primero Mining Mining and CWI Corp. Management Nicholas C. Sonntag, Exec. VP W. Bill. E. Elaine Elaine A. Wong, Exec. VP Presidentof CH2M Hill in and Canada, China Westport President, andEurope.Asia Former Bennett ones LLP,Bennettones experiencein M&A CorporateSecretaryfor Westport, Partnerof DDi Former CFO of FuelSystems and Inc. Solutions, and Asia in strategic international planning in Canada Former CFO of Westport, extensive experience Chipman Corp., auditor at Deloitte & auditorDeloitteat Corp., Larkin,CFO Johnston Touche Simon Fraser University | March, March, | 2011 UniversityFraser Simon LLP

APPENDIX 55 • • for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Business Business Overview OEM’s partnershipswith Establishes naturalgas. engines to on run convert diesel technologies which Develops • NGV market. revenue frommarketUS onlywhich makesof 1.3% up Operates globallycurrentlybut derives of majority Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 56 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Partnerships AutomoticeWorld.com Presentation, November Westport Source(s): FAW Tata Dongfeng Volvo Daimler Global Truck Producers CNHTC Cummins Diamler Volvo Weichai Global Engine Producers Partnerships Rank Rank 5 4 3 2 1 5 4 3 2 1 Partnership Partnership YES YES YES YES YES YES YES - - - • • CWI Only profitableventure is leaders with industry Established partnerships Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 57 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Going Green form ofenergy.” “…natural gasis thecleanest fossiland ahighlyfuel efficient Pollutant Source: Source: EIA Mercury Particulates Sulfur Dioxide Nitrogen Oxides Carbon Monoxide Carbon Dioxide Figure EmissionLevelsFossilFuel Figure 5.4 - Natural Gas Issues and Trends 1998 Trends and GasIssues Natural ( Lb / Billion Btu of Energy Input) Natural Natural Gas 117,000 92 40 0 7 1 164,000 1,122 0.007 448 Oil Oil 84 33 208,000 0.016 2,744 2,591 Coal 457 208 • 2000. per year since has grown 27.5% natural gas vehicles Worldwide use of ~pickensplan.com Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 58 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information US Truck Market 14.0 14.0 to 16.0 10.0 to 14.0 Medium Trucks 6 to 10 Less than 6 Light Trucks (inthousand Source(s): 1992, 1997, 2002: U.S. CensusBureau ALL trucks Not reported 130.0 100.0 to 130.0 80.0 to 100.0 60.0 to 80.0 50.0 to 60.0 40.0 to 50.0 33.0 to 40.0 26.0 to 33.0 Heavy Trucks (inthousand 19.5 to 26.0 Light 16.0 to 19.5 - heavy Trucks lb lb or more lb lb lb lb lb lb lb lb lb lb lb lb (inthousand Thousands of Trucks (inthousand lb lb ) ) lb ) lb ) 1992 59,200.8 50,545.7 4,647.5 781.1 226.7 338.6 232.6 387.3 732.0 282.3 282.4 694.3 12.3 33.3 <50 4.6 72,800.3 62,798.4 1997 1,069.8 5,301.5 311.4 399.9 256.7 427.7 729.3 300.8 315.9 818.9 17.9 46.3 <50 5.9 85,174.8 17,142.3 62,617.3 2002 1,178.7 1,142.1 326.6 318.4 228.8 436.8 376.1 395.9 26.4 68.9 NA 6.3 • • Heavy Trucks. 28% increase in year period. tentrucks during overall of number 42% increase in Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 59 Source: Bloomberg *Data in USD for 2009 FY Landi Renzo Fuel Systems Solutions Natural Gas Cummins Daimler Volvo Weichai Diesel Competitors Westport for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Competitors 193,063,000,000 26,808,000,000 14,425,690,000 Revenues 6,405,000,000 270,770,000 453,320,000 130,710,000 ROE - - 12.22 19.57 51.61 - 16.8 25.1 8.59 34.5 Westport HD Heavy Duty Weichai, Volvo, Daimler, Cummins diesel engine manufacturers competition fromestablished Westportfaces robust Advanced Fuels Technologies, Westport Innovations Business Units PrinsAutogassystemen Landi Fuel Systems Solutions Inc. Medium CWI Renzo Light Light duty Juniper Simon Fraser University | March, March, | 2011 UniversityFraser Simon Westport Services R&D R&D

APPENDIX 60 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information  Operating Efficiency Sharp decline in contribution margin in 2010to:marginin due contribution in Sharp decline   Transition tosuppliers new components New emissions standards, requiringredesigned 100.0% 150.0% - 50.0% 50.0% 0.0% 2006 ∆CoGS/∆Revenues 2007 2008 2009 2010 Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 61 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information    Early Advantage Relationships Westport’s Advantages Founding at UBC     Customers Partners / Suppliers Highlight of some tech Early to market Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 62 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Competitive Analysis Power Suppliers of Low ThreatNew of Competitive Substitutes Moderate Threat of Entrants Rivalry High Low Power Buyersof Moderate Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 63 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information     Government Incentives NAT GAS Act vehicles Income tax credits for alternative fuel Excise tax credit to seller of CNGor LNG refuelling equipment Income tax credits for natural gas  Earnings Call) duck session” David Demers, CEO (Q2 2011 “I think that the odds are low in alame Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 64 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information    High Internal Risk Technology risks Adoption risks Financial risks       New technology R&D and intellectual capital expiration Psychology risk Lack of infrastructure Takeover risk due to excess cash High R&D costs Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 65 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information   High External Risk Legislative and environmental risk Management risk   Demand Demand affected by natural gas act High exposure to JVand partnership risk Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 66 Free cash flow to firm Depreciation Less: Cap cash working capital Less: Changesin non earnings After for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Free Cash Flow - tax operating Ex - - ( ( ( ( 23,632) 28,904) 3,400) 1,872) 2010 ( ( ( 13,748) 9,086 2,353) 7,015) 2011 ( ( ( 13,292) 12,391) 2,086 1,185) 2012 ( ( 16,991) 9,473 7,795) ( 2013 277) … Terminal ( Simon Fraser University | March, March, | 2011 UniversityFraser Simon 50,967 14,723) 36,722 2020 479

APPENDIX 67 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information   Break - - - - - Net income could become Net become positive could income by 2017 break Continued revenuegrowth and operating improvements efficiency tolead $50,000 $40,000 $30,000 $20,000 $10,000 $10,000 $20,000 $0 - evenoperating in by earnings 2015 2006 - Even Point 2008 Operating Income (EBIT) Income Operating 2010 2012e Normalized incomeNormalized 2014e 2016e 2018e Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 68 Original Program based based on base truck chassis One amortization One amortization period for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Leasing Program Purchasing program Upfront capital cost different amortization periods Payment over the life of lease New Program Price components with on per mile basis Leasing program Simon Fraser University | March, March, | 2011 UniversityFraser Simon

APPENDIX 69 Vancouver Vancouver for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Global Relationships Sweden Simon Fraser University | March, March, | 2011 UniversityFraser Simon China

APPENDIX 70 10.00 15.00 20.00 25.00 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Stock Price Movement 0.00 5.00 Jan 2006 Jan 2007 Jan 2008 Jan 2009 Jan 2010 Simon Fraser University | March, March, | 2011 UniversityFraser Simon Jan 2011

APPENDIX 71 for use only by the Global Investment Research Challenge. Research Investment Global the forby use only is intended and purposesis provided only you informationalfor This to Disclaimer: information Natural Gas Consumption 0.0 0.5 1.0 1.5 2.0 2.5 3.0

1997 Natural Natural 1999

2001 Gas: Vehicle Consumption (Billion Feet) (Billion Cubic

2003

2005

2007

Simon Fraser University | March, March, | 2011 UniversityFraser Simon 2009

APPENDIX