EX-99.1 2 ea156888ex99-1_kanditech.htm PRESS RELEASE DATED MARCH 15, 2022

Exhibit 99.1

 

Kandi Technologies Reports 2021 Financial Results

 

· 2021 revenue of $91.5 million, net income of $23 million

 

· Year-end cash and equivalents of $129 million

 

· Explosive growth in self-balancing scooter segment, up over 400%

 

JINHUA, CHINA, March 15, 2022 (GLOBE NEWSWIRE) --  Kandi Technologies Group, Inc. (the “Company,” “we” or “Kandi”) (NASDAQ GS: KNDI), today announced its financial results for the full year ended December 31, 2021.

 

Full Year 2021 Highlights

 

●Total revenue was $91.5 million, compared to $76.9 million in 2020.

 

●EV parts sales were $25.3million, compared to $40.6 million in 2020.

 

●Off-road vehicles sales were $29.3 million, compared to $29.8 million in 2020.

 

●EV product sales increased by 116% to $1.5 million, compared to $0.7 million in 2020.

 

●Electric Scooters, Electric Self-Balancing Scooters and associated parts sales increased by 420.6% to $30.0 million, compared with $5.8 million in 2020.

 

●Gross margin was 17.8%, compared to 17.5% in 2020.

 

●Operating income was $1.34 million, compared to $0.8 million in 2020.

 

●Net income was $22.9 million, or $0.30 income per fully diluted share, compared to a net loss of $10.4 million, or $0.19 loss per fully diluted share in 2020.

 

●As of December 31, 2021, working capital was $278.4 million; cash, cash equivalents, restricted cash and certificate of deposit totaled $223.7 million.

 

Mr. Hu Xiaoming, Chairman and CEO of Kandi commented, “As a company, our primary focus initially was the design, development, manufacture, and sale of electric vehicle products and electric vehicle parts. Nevertheless, some Chinese pure electric vehicle manufacturers have attempted to capture market share at any cost, resulting in substantial losses in recent years. It has become increasingly obvious that the pure electric vehicle market in China has not yet reached a healthy development stage. We do not believe it is prudent to participate in such loss-making competition given our current financial resources. It has always been our belief that pure electric vehicles can only become widely popular once the battery swap model matures. With our advanced pure electric vehicle intelligent battery swapping equipment, pure electric vehicle manufacturing capacity and dozens of patented technologies for battery swap, we will continue to focus on improving car-hailing using EVs with battery swap capability. As soon as the electric vehicle market in China enters an orderly stage of development, we will consider re-entering the market.”

 

Hu continued, “We see huge demand building for electrified off-road vehicles. In 2022, we will apply EV technology to off-road vehicle products and launch a variety of pure electric utility terrain vehicles (“UTVs”), neighborhood EVs (“NEVs”), golf carts, and off-road crossover vehicles. We will make full use of our high-end technology, which is the culmination of years of development work in the EVs, to aggressively pursue the off-road vehicle market. Our goal is to become the  market leader in this field in China within three years.”

 

Regarding Company’s strategy, Hu commented, “The business transformation undertaken by the company in 2021 is already proving successful. Due to the strategic action, we took following the COVID-19 pandemic in 2020, our development has been reignited. We are concentrating our resources on markets with the best growth potential and a reasonable level of competition. Despite the challenges associated with this type of transformation, this is a step that Kandi must take to achieve sustainable growth.”

 

Hu concluded, “Looking forward, we are optimistic about the future of our company. Since we will be launching several pure electric off-road vehicles soon, we believe that our 100% electric off-road vehicle products that incorporate pure EV technology will be quite popular. Additionally, we look forward to the new opportunities brought about by China entering a healthy and orderly development stage for its pure electric vehicle market. In view of our outstanding technological innovation capabilities, solution integration capabilities and operational experience, we are in an excellent position to benefit from the development of the EV and electric off-road vehicle industries.”

 

 

 

 

Full Year 2021 Financial Results

 

Net Revenues and Gross Profit (in USD millions)

 

   2021   2020   Y-o-Y% 
Net Revenues  $91.5   $76.9    18.9%
Gross Profit  $16.2   $13.5    20.5%
Gross Margin%   17.8%   17.5%   - 

 

Net revenues of $91.5 million increased 18.9% from 2020. The increase was due mainly to explosive growth in the Electric Scooters, Electric Self-Balancing Scooters and associated parts segment. Since entering this market in 2020, Kandi has driven growth through sales to more customers, and high growth of customers’ end-product sales. Gross margin was stable at 17.8%, compared with 17.5% in 2020.

 

Operating Income/Loss (in USD millions)

 

   2021   2020   Y-o-Y% 
Operating Expenses  $(14.9)  $(12.7)   17.1%
Income from Operations  $1.3   $0.8    77.1%
Operating Margin%   1.5%   1.0%   - 

 

Total operating expenses were $14.9 million, compared with $12.7 million in 2020. The increase was due to higher R&D expense. Operating expenses were partially offset by the gain on disposal of long-lived assets recognized from the relocation of the Jinhua facility.  

 

Net Income/Loss (in USD millions)

 

   2021   2020   Y-o-Y% 
Net Income (Loss)  $22.9   $(10.4)   -320.0%
Net Income (Loss) per Share, Basic and Diluted  $0.30   $(0.19)   - 

 

Net income was $22.9 million, comparing to a net loss of $10.4 million in 2020. The profitable result was attributable to the gain resulting from the relocation of the Jinhua headquarters.

 

Full Year 2021 Conference Call Details

 

The Company has scheduled a conference call and live webcast to discuss its financial results at 8:00 A.M. Eastern Time (8:00 P.M. Beijing Time) on Tuesday, March 15, 2022. Management will deliver prepared remarks to be followed by a question and answer session.

 

The dial-in details for the conference call are as follows:

 

●Toll-free dial-in number: +1-877-407-3982

 

●International dial-in number: + 1-201-493-6780

 

●Webcast and replay: https://themediaframe.com/mediaframe/webcast.html?webcastid=8oRuq5Ul

 

The live audio webcast of the call can also be accessed by visiting Kandi’s Investor Relations page on the Company’s website at http://www.kandivehicle.com. An archive of the webcast will be available on the Company’s website following the live call.

 

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About Kandi Technologies Group, Inc.

 

Kandi Technologies Group, Inc. (KNDI), headquartered in Jinhua Economic Development Zone, Zhejiang Province, is engaged in the research, development, manufacturing, and sales of various vehicular products. Kandi conducts its primary business operations through its wholly-owned subsidiary, Zhejiang Kandi Technologies Group Co., Ltd. (“Zhejiang Kandi Technologies”), formerly, Zhejiang Kandi Vehicles Co., Ltd. and its subsidiaries including Zhejiang Kandi Smart Battery Swap Technology Co., Ltd, and SC Autosports, LLC (d/b/a Kandi America), the wholly-owned subsidiary of Kandi in the United States, and its wholly-owned subsidiary, Kandi America Investment, LLC. Zhejiang Kandi Technologies has established itself as one of China’s leading manufacturers of pure electric vehicle parts and off-road vehicles.

 

Safe Harbor Statement

 

This press release contains certain statements that may include “forward-looking statements.” All statements other than statements of historical fact included herein are “forward-looking statements.” These forward-looking statements are often identified by the use of forward-looking terminology such as “believes,” “expects” or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company’s actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company’s periodic reports that are filed with the Securities and Exchange Commission and available on the SEC’s website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the applicable securities laws, the Company does not assume a duty to update these forward-looking statements.

 

Follow us on Twitter: @ Kandi_Group

 

Contacts:

 

Kandi Technologies Group, Inc.
Ms. Kewa Luo
+1 (212) 551-3610
IR@kandigroup.com

 

The Blueshirt Group
Mr. Gary Dvorchak, CFA
gary@blueshirtgroup.com

 

- Tables Below -

 

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KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
 

   December 31,
2021		   December 31,
2020		 
Current assets        
Cash and cash equivalents  $129,223,443   $142,078,190 
Restricted cash   39,452,564    442,445 
Certificate of deposit   55,041,832    - 
Accounts receivable (net of allowance for doubtful accounts of $3,053,277 and $110,269 as of December 31, 2021 and December 31, 2020, respectively)   52,896,305    38,547,137 
Inventories   33,171,973    19,697,383 
Notes receivable   323,128    31,404,630 
Other receivables   8,901,109    1,875,245 
Prepayments and prepaid expense   17,657,326    13,708,149 
Advances to suppliers   5,940,456    36,733,182 
Amount due from the Affiliate Company   -    21,742,226 
Amount due from related party   -    886,989 
TOTAL CURRENT ASSETS   342,608,136    307,115,576 
           
NON-CURRENT ASSETS          
Property, plant and equipment, net   111,577,411    65,402,680 
Intangible assets, net   13,249,079    3,232,753 
Land use rights, net   3,250,336    3,257,760 
Construction in progress   79,317    16,317,662 
Deferred tax assets   2,219,297    8,964,946 
Long-term investment   157,262    45,958 
Investment in the Affiliate Company   -    28,892,638 
Goodwill   36,027,425    29,712,383 
Other long-term assets   10,992,009    32,307,484 
TOTAL NON-CURRENT ASSETS   177,552,136    188,134,264 
           
TOTAL ASSETS  $520,160,272   $495,249,840 
           
CURRENT LIABILITIES          
Accounts payable  $36,677,802   $34,257,935 
Other payables and accrued expenses   9,676,973    7,218,395 
Short-term loans   950,000    - 
Notes payable   8,198,193    92,445 
Income tax payable   1,620,827    1,313,754 
Advance receipts   -    38,229,242 
Amount due to related party   -    500,000 
Other current liabilities   7,038,895    2,185,654 
TOTAL CURRENT LIABILITIES   64,162,690    83,797,425 
           
NON-CURRENT LIABILITIES          
Long-term loans   2,210,589    - 
Deferred tax liability   2,460,141    3,483,171 
Contingent consideration liability   7,812,000    3,743,000 
Other long-term liabilities   314,525    459,580 
TOTAL NON-CURRENT LIABILITIES   12,797,255    7,685,751 
           
TOTAL LIABILITIES   76,959,945    91,483,176 
           
STOCKHOLDER’S EQUITY          
Common stock, $0.001 par value; 100,000,000 shares authorized; 77,385,130 and 77,298,499 shares issued and 76,705,381 and 75,377,555 outstanding at December 31,2021 and December 31,2020, respectively   77,385    75,377 
Less: Treasury stock (679,749 shares and 0 shares with average price of $3.52 at December 31,2021 and December 31,2020, respectively)   (2,392,203)   - 
Additional paid-in capital   449,479,461    439,549,338 
Accumulated deficit (the restricted portion is $4,422,033 and $4,422,033 at December 31,2021 and December 31,2020, respectively)   (4,216,102)   (27,079,900)
Accumulated other comprehensive income (loss)   251,786    (8,778,151)
TOTAL STOCKHOLDERS’ EQUITY   443,200,327    403,766,664 
           
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY  $520,160,272   $495,249,840 

 

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KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS AND
COMPREHENSIVE INCOME (LOSS)
FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020
  

   Years Ended 
   December 31,
2021		   December 31,
2020		 
REVENUES FROM UNRELATED PARTIES, NET  $91,484,792   $76,176,609 
REVENUES FROM THE AFFILIATE COMPANY AND RELATED PARTIES, NET   1,592    743,904 
           
REVENUES, NET   91,486,384    76,920,513 
           
COST OF GOODS SOLD   (75,238,522)   (63,432,580)
           
GROSS PROFIT   16,247,862    13,487,933 
           
OPERATING INCOME (EXPENSE):          
Research and development   (38,971,986)   (7,246,312)
Selling and marketing   (4,736,000)   (6,619,355)
General and administrative   (19,605,468)   (13,042,103)
Gain on disposal of long-lived assets   48,401,797    14,174,233 
TOTAL OPERATING EXPENSE   (14,911,657)   (12,733,537)
           
INCOME FROM OPERATIONS   1,336,205    754,396 
           
OTHER INCOME (EXPENSE):          
Interest income   4,208,751    2,190,678 
Interest expense   (407,620)   (3,750,233)
Change in fair value of contingent consideration   2,834,000    (565,000)
Government grants   1,233,192    1,130,262 
Gain from sale of equity in the Affiliate Company   17,788,351    - 
Share of loss after tax of the Affiliate Company   (2,592,334)   (17,252,662)
Other income, net   4,809,743    2,051,226 
TOTAL OTHER INCOME (EXPENSE), NET   27,874,083    (16,195,729)
           
INCOME (LOSS) BEFORE INCOME TAXES   29,210,288    (15,441,333)
           
INCOME TAX (EXPENSE) BENEFIT   (6,346,490)   5,047,169 
           
NET INCOME (LOSS)   22,863,798    (10,394,164)
           
OTHER COMPREHENSIVE INCOME          
Foreign currency translation adjustment   9,029,937    13,945,430 
COMPREHENSIVE INCOME  $31,893,735   $3,551,266 
           
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC AND DILUTED   76,148,688    55,960,010 
           
NET INCOME (LOSS) PER SHARE, BASIC AND DILUTED  $0.30   $(0.19)

 

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KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY
FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020
  

   Number of Outstanding
Shares		   Common Stock   Treasury Stock   Additional
Paid-in
Capital		   Accumulated
Deficit		   Accumulated Other Comprehensive Income
(Loss)		   Total 
BALANCE AS OF DECEMBER 31, 2019   52,839,441   $52,839   $(2,477,965)  $259,691,370   $(16,685,736)  $(22,723,581)  $217,856,927 
                                    
Stock issuance and award   1,771,317    1,771    -    4,058,052    -    -    4,059,823 
Cancellation of the Treasury Stock   (487,155)   (487)   2,477,965    (2,477,478)   -    -    - 
Registered Direct Offering   18,253,952    18,254    -    151,904,993    -    -    151,923,247 
Warrants issuance   -    -    -         -    -    - 
Stock option exercise   3,000,000    3,000    -    29,157,000    -    -    29,160,000 
Net loss   -    -    -    -    (10,394,164)   -    (10,394,164)
Foreign currency translation   -    -    -    -         13,945,430    13,945,430 
Reduction in the Affiliate Company’s equity (net of tax effect of $491,400)   -    -    -    (2,784,599)   -    -    (2,784,599)
                                    
BALANCE AS OF DECEMBER 31, 2020   75,377,555   $75,377   $-   $439,549,338   $(27,079,900)  $(8,778,151)  $403,766,664 
                                    
Stock issuance and award   2,007,575    2,008    -    7,178,928    -    -    7,180,936 
Stock buyback             (2,392,203)        -    -    (2,392,203)
Commission in stock buyback                  (20,457)             (20,457)
Net income   -    -    -    -    22,863,798    -    22,863,798 
Foreign currency translation   -    -    -    -         9,029,937    9,029,937 
Reversal of reduction in the Affiliate Company’s equity (net of tax effect of $491,400)   -    -    -    2,771,652    -    -    2,771,652 
                                    
BALANCE AS OF DECEMBER 31, 2021   77,385,130   $77,385   $(2,392,203)  $449,479,461   $(4,216,102)  $251,786   $443,200,327 

 

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KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020

 

   Years Ended 
   December 31,
2021		   December 31,
2020		 
CASH FLOWS FROM OPERATING ACTIVITIES:        
Net income (loss)  $22,863,798   $(10,394,164)
Adjustments to reconcile net income to net cash provided by operating activities          
Depreciation and amortization   10,038,976    8,222,984 
Provision (reversal) of allowance for doubtful accounts   862,414    (152,809)
Deferred taxes   4,073,315    (5,349,722)
Share of loss after tax of the Affiliate Company   2,592,334    17,252,662 
Gain from equity sale in the Affiliate Company   (17,788,351)   - 
Gain on disposal of long-lived assets   (48,401,797)   (14,174,233)
Change in fair value of contingent consideration   (2,834,000)   565,000 
Stock based compensation expense   1,484,576    902,666 
           
Changes in operating assets and liabilities:          
Accounts receivable   (2,542,692)   19,247,519 
Inventories   (7,522,761)   9,246,455 
Other receivables and other assets   (291,235)   2,008,612 
Advances to supplier and prepayments and prepaid expenses   27,786,143    (36,330,634)
Amount due from the Affiliate Company   -    4,237,103 
Due from related party   (500,000)   (339,118)
           
Increase (Decrease) In:          
Accounts payable   2,176,638    (30,993,717)
Other payables and accrued liabilities   10,513,511    (173,806)
Notes payable   (2,423,514)   (13,912,842)
Income tax payable   154,334    (745,208)
Net cash provided by (used in) operating activities  $241,689   $(50,883,252)
           
CASH FLOWS FROM INVESTING ACTIVITIES:          
Purchases of property, plant and equipment, net   (11,574,706)   (7,483,743)
Purchases of land use rights and other intangible assets   (2,356,626)   (3,281,115)
Acquisition of Jiangxi Huiyi   (7,117,310)   - 
Payment for construction in progress   (5,210,642)   (7,419,644)
Proceeds from disposal of long-lived assets   23,306,007    52,579,492 
Loan to third party   31,783,439    (26,097,991)
Certificate of deposit   (54,264,407)   - 
Cash received from sales of equity in the Affiliate Company   47,752,678    42,897,929 
Long-term investment   (108,529)   (43,478)
Net cash provided by investing activities  $22,209,904   $51,151,450 
           
CASH FLOWS FROM FINANCING ACTIVITIES:          
Proceeds from short-term loans   950,000    24,642,399 
Repayments of short-term loans   -    (50,873,903)
Repayments of long-term loans   -    (28,799,501)
Proceeds from long-term loans   2,210,589    394,116 
Proceeds from issuance of common stock and warrants   -    151,923,247 
Purchase of treasury stock   (2,412,660)   - 
Proceeds from exercises stock options, stock awards and other financing   -    29,160,000 
Net cash provided by financing activities  $747,929   $126,446,358 
           
NET INCREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH  $23,199,522   $126,714,556 
Effect of exchange rate changes  $2,955,850   $(706,556)
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF YEAR  $142,520,635   $16,512,635 
           
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD  $168,676,007   $142,520,635 
-CASH AND CASH EQUIVALENTS AT END OF PERIOD   129,223,443    142,078,190 
-RESTRICTED CASH AT END OF PERIOD   39,452,564    442,445 
           
SUPPLEMENTARY CASH FLOW INFORMATION          
Income taxes paid  $2,074,668    1,046,127 
Interest paid  $35,001    653,507 
           
SUPPLEMENTAL NON-CASH DISCLOSURES:          
Decrease in investment in the Affiliate Company due to change in its equity   -    3,099,193 
Reversal of decrease in investment in the Affiliate Company due to change in its equity (net of tax effect of $491,400)   2,824,115    - 
Purchase of construction in progress in accounts payable and other payable   -    7,945,414 
Common stock issued from settlement of payables related to acquisitions   5,762,000    3,166,427 

 

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