@Geely: Kandi Technologies Reports First Quarter 2023 Financial Results

Successful Pivot to Fully Electric Off-road Vehicles Continued to Boost Revenue
High Gross Margin Driven by Fully Electric Crossover Golf Carts

JINHUA, CHINA, May 10, 2023 (GLOBE NEWSWIRE) — Kandi Technologies Group, Inc. (the “Company”, “we” or “Kandi”) (NASDAQ GS: KNDI), today announced its financial results for the first quarter of 2023.

First Quarter Highlights

Total revenues of $22.9 million compared to $24.9 million in the same period of 2022.
Off-road vehicles and associated parts sales increased by 94.0% to $20.8 million, compared to $10.7 million in the same period of 2022.
EV products and parts sales totaled $0.03 million, compared with $4.0 million total for the first quarter of 2022, attributed to the Company’s shift in focus towards production of off-road vehicles with higher demand and better margins.
Electric Scooters, Electric Self-Balancing Scooters and associated parts sales were $0.1 million, compared with $2.1 million in the same period of 2022.
Battery exchange equipment and battery exchange service sales were $0.10 million, compared with $0.03 million in the same period of 2022.
Lithium-ion cells sales of $1.8 million compared to $8.0 million in the same period of 2022.
Net income was $0.6 million, or $0.01 income per fully diluted share, compared to a net loss of $1.6 million, or $0.02 loss per fully diluted share for the same period of 2022.
Working capital totaled $253.1 million as of March 31, 2023.
Cash and equivalents, restricted cash, and certificate of deposit totaled $238.6 million as of March 31, 2023.

Dr. Xueqin Dong, CEO of Kandi commented, “We are pleased to report that sales of our off-road vehicles have significantly contributed to our overall revenue and gross margin. Our all-electric crossover golf cart has been successfully launched and well received by customers, enabling our company to maintain a strong growth momentum in the rapidly expanding market for all-electric off-road vehicles. As the trend towards electrification of off-road fuel vehicles continues globally, we will continue to introduce a variety of fully electric off-road vehicles. We are confident that we will achieve sustained growth in this field.”

Dr. Dong continued, “Our successful transition in the fully electric off-road vehicles demonstrates our commitment to innovation and development. We are confident in our continued focus on this market, which will not only bring significant financial benefits but also meaningful benefits in terms of environmental sustainability and social responsibility.”

Q1 2023 Financial Results

Net Revenues and Gross Profit (in USD millions)

Q1 2023 Q1 2022 Y-o-Y%
Net Revenues $22.9 $24.9 -8.2%
Gross Profit $8.0 $2.4 236.4%
Gross Margin% 35.1% 9.6%

Net revenues of $22.9 million decreased by 8.2% from the same period of 2022. This decrease was primarily due to a reduction in sales of EV parts and products, as the Company saw a lower demand for EV and shifted its focus towards off-road vehicles and associated parts with surging demand. However, the year-over-year gross margins were higher, attributed to the higher-margin features of off-road vehicles particularly crossover golf carts.

Operating Income/Loss (in USD millions)

Q1 2023 Q1 2022 Y-o-Y%
Operating Expenses ($10.3) ($8.1) 26.9%
Loss from Operations ($2.2) ($5.7) -60.8%
Operating Margin% -9.8%  -22.9% – 

Operating expenses amounted to $10.3 million, compared to $8.1 million during the corresponding period in 2022. The rise in operating expenses can be attributed to higher sales and marketing expenses, which is mainly due to increased commission offered for the sales of off-road vehicles, as well as higher shipping and related expenses due to larger exports to the US market. Additionally, the increase in OpEx was also driven by higher general and administrative expenses resulting from an increase in hires and increased storage fees due to a rise in inventories kept in the US.

Net Income/Loss (in USD millions)

Q1 2023 Q1 2022 Y-o-Y%
Net Income (Loss)  $0.6 ($1.6) 136.8%
Net Income (Loss) per Share, Basic and Diluted $0.01 ($0.02) – 

Net income was $0.6 million, compared with a net loss of $1.6 million for the same period of 2022. The primary factor contributing to the rise in net income was the increase in gross profit, driven by a greater proportion of sales from off-road vehicles with larger gross margins.

First Quarter 2023 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 Wednesday, May 10, 2023. 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: +1-844-826-3035
International dial-in number: + 1-412-317-5195
Webcast and replay: 

https://viavid.webcasts.com/starthere.jsp?ei=1614390&tp_key=71bb235f2c

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.

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) 551-3610IR@kandigroup.com 

The Blueshirt GroupMr. Gary Dvorchak, CFAgary@blueshirtgroup.com 

– Tables Below –

KANDI TECHNOLOGIES GROUP, INC.AND SUBSIDIARIESCONDENSED CONSOLIDATED BALANCE SHEETS

  March 31,2023     December 31,2022  
  (Unaudited)        
CURRENT ASSETS          
Cash and cash equivalents $ 75,133,544     $ 84,063,717  
Restricted cash   62,949,702       66,976,554  
Certificate of deposit   100,484,949       81,191,191  
Accounts receivable (net of allowance for doubtful accounts of $2,295,570 and $2,285,386 as of March 31, 2023 and December 31, 2022, respectively)   28,275,773       38,150,876  
Inventories   47,303,083       40,475,366  
Notes receivable   291,202       434,461  
Other receivables   8,940,359       11,912,615  
Prepayments and prepaid expense   3,227,740       2,970,261  
Advances to suppliers   1,049,800       3,147,932  
TOTAL CURRENT ASSETS   327,656,152       329,322,973  
               
NON-CURRENT ASSETS              
Property, plant and equipment, net   95,606,862       97,168,753  
Intangible assets, net   7,631,452       7,994,112  
Land use rights, net   2,901,166       2,909,950  
Construction in progress   232,485       199,837  
Deferred tax assets   1,432,527       1,432,527  
Long-term investment   145,630       144,984  
Goodwill   33,301,291       33,178,229  
Other long-term assets   10,568,944       10,630,911  
TOTAL NON-CURRENT ASSETS   151,820,357       153,659,303  
               
TOTAL ASSETS $ 479,476,509     $ 482,982,276  
               
CURRENT LIABILITIES              
Accounts payable $ 31,681,798     $ 35,321,262  
Other payables and accrued expenses   11,696,505       14,131,414  
Short-term loans   4,210,589       5,569,154  
Notes payable   20,047,569       19,123,476  
Income tax payable   850,729       1,270,617  
Other current liabilities   6,024,221       6,089,925  
TOTAL CURRENT LIABILITIES   74,511,411       81,505,848  
               
NON-CURRENT LIABILITIES              
Deferred taxes liability   1,378,372       1,378,372  
Contingent consideration liability   2,164,000       1,803,000  
Other long-term liabilities   548,418       602,085  
TOTAL NON-CURRENT LIABILITIES   4,090,790       3,783,457  
               
TOTAL LIABILITIES   78,602,201       85,289,305  
               
STOCKHOLDERS EQUITY              
Common stock, $0.001 par value; 100,000,000 shares authorized; 77,678,730 and 77,668,730 shares issued and 74,190,171 and 74,180,171 outstanding at March 31,2023 and December 31,2022, respectively   77,679       77,669  
Less: Treasury stock (3,488,559 shares with average price of $2.81 at both March 31,2023 and December 31,2022 )   (9,807,820 )     (9,807,820 )
Additional paid-in capital   452,376,828       451,373,645  
Accumulated deficit (the restricted portion is $4,422,033 and $4,422,033 at March 31, 2023 and December 31, 2022, respectively)   (16,368,875 )     (16,339,765 )
Accumulated other comprehensive loss   (26,750,552 )     (28,333,239 )
TOTAL KANDI TECHNOLOGIES GROUP, INC. STOCKHOLDERS’ EQUITY   399,527,260       396,970,490  
               
Non-controlling interests   1,347,048       722,481  
TOTAL STOCKHOLDERS’ EQUITY   400,874,308       397,692,971  
               
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY $ 479,476,509     $ 482,982,276  
               

  

KANDI TECHNOLOGIES GROUP, INC.AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS ANDCOMPREHENSIVE INCOME (LOSS)(UNAUDITED)

  Three Months Ended  
  March 31,2023     March 31,2022  
           
REVENUES FROM UNRELATED PARTIES, NET $ 22,862,108     $ 24,891,404  
REVENUES FROM THE FORMER AFFILIATE COMPANY AND RELATED PARTIES, NET          
               
REVENUES, NET   22,862,108       24,891,404  
               
COST OF GOODS SOLD   (14,832,878 )     (22,504,241 )
               
GROSS PROFIT   8,029,230       2,387,163  
               
OPERATING INCOME (EXPENSE):              
Research and development   (878,980 )     (1,140,586 )
Selling and marketing   (1,827,729 )     (1,193,699 )
General and administrative   (7,559,452 )     (5,756,531 )
TOTAL OPERATING EXPENSE   (10,266,161 )     (8,090,816 )
               
LOSS FROM OPERATIONS   (2,236,931 )     (5,703,653 )
               
OTHER INCOME (EXPENSE):              
Interest income   2,100,343       1,222,304  
Interest expense   (173,370 )     (148,144 )
Change in fair value of contingent consideration   (361,000 )     2,690,000  
Government grants   620,404       244,098  
Other income, net   266,465       43,782  
TOTAL OTHER INCOME, NET   2,452,842       4,052,040  
               
INCOME (LOSS) BEFORE INCOME TAXES   215,911       (1,651,613 )
               
INCOME TAX BENEFIT   379,546       32,600  
               
NET INCOME (LOSS)   595,457       (1,619,013 )
               
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NON-CONTROLLING INTERESTS   624,567       2,957  
               
NET LOSS ATTRIBUTABLE TO KANDI TECHNOLOGIES GROUP, INC. STOCKHOLDERS   (29,110 )     (1,616,056 )
               
OTHER COMPREHENSIVE INCOME              
Foreign currency translation adjustment   1,582,687       1,009,811  
               
COMPREHENSIVE INCOME (LOSS) $ 2,178,144     $ (609,202 )
               
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC   74,186,504       76,289,846  
WEIGHTED AVERAGE SHARES OUTSTANDING DILUTED   75,095,595       76,289,846  
               
NET INCOME (LOSS) PER SHARE, BASIC $ 0.01     $ (0.02 )
NET INCOME (LOSS) PER SHARE, DILUTED $ 0.01     $ (0.02 )
               

KANDI TECHNOLOGIES GROUP, INC.AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS’ EQUITY(UNAUDITED)

  Number of Outstanding Shares     CommonStock     TreasuryStock     Additional Paid-in Capital     Accumulated Earning(Deficit)     AccumulatedOtherComprehensiveIncome     Non-controlling interests     Total  
Balance, December 31, 2021   77,385,130     $ 77,385     $ (2,392,203 )   $ 449,479,461     $ (4,216,102 )   $ 251,786     $   –     $ 443,200,327  
Stock issuance and award   25,000       25             92,925                         92,950  
Stock buyback            –       (1,570,324 )     (13,236 )                       (1,583,560 )
Capital contribution from shareholder                                       1,198,398       1,198,398  
Net loss                           (1,616,056 )           (2,957 )     (1,619,013 )
Foreign currency translation                                 1,009,811             1,009,811  
                                                               
Balance, March 31, 2022   77,410,130     $ 77,410     $ (3,962,527 )   $ 449,559,150     $ (5,832,158 )   $ 1,261,597     $ 1,195,441     $ 442,298,913  
  Number of Outstanding Shares     CommonStock     TreasuryStock     Additional Paid-in Capital     Accumulated Earning(Deficit)     AccumulatedOtherComprehensiveIncome     Non-controlling interests     Total  
Balance, December 31, 2022   77,668,730     $ 77,669     $ (9,807,820 )   $ 451,373,645     $ (16,339,765 )   $ (28,333,239 )   $ 722,481     $ 397,692,971  
Stock issuance and award   10,000       10             22,290                         22,300  
Stock based compensation                     980,893                         980,893  
Net income (loss)                           (29,110 )           624,567       595,457  
Foreign currency translation                                 1,582,687             1,582,687  
                                                               
Balance, March 31, 2023   77,678,730     $ 77,679     $ (9,807,820 )   $ 452,376,828     $ (16,368,875 )   $ (26,750,552 )   $ 1,347,048     $ 400,874,308  
                                                               

KANDI TECHNOLOGIES GROUP, INC.AND SUBSIDIARIESCONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(UNAUDITED)

  Three Months Ended  
  March 31,2023     March 31,2022  
           
CASH FLOWS FROM OPERATING ACTIVITIES:          
Net income (loss) $ 595,457     $ (1,619,013 )
Adjustments to reconcile net (loss) income to net cash provided by operating activities              
Depreciation and amortization   3,051,089       3,294,499  
Provision (reversal) of allowance for doubtful accounts         4,389  
Change in fair value of contingent consideration   361,000       (2,690,000 )
Stock award and stock based compensation expense   1,003,818       22,925  
               
Changes in operating assets and liabilities:              
               
Accounts receivable   6,275,418       5,197,268  
Notes receivable   358,114       1,965,596  
Inventories   (6,750,531 )     2,498,914  
Other receivables and other assets   3,108,680       (790,486 )
Advances to supplier and prepayments and prepaid expenses   1,865,040       1,425,684  
               
Increase (Decrease) In:              
Accounts payable   6,097,620       3,088,095  
Other payables and accrued liabilities   (2,752,663 )     (1,688,414 )
Notes payable   (5,413,459 )     (4,401,457 )
Income tax payable   (437,385 )     (119,559 )
Net cash provided by operating activities $ 7,362,198     $ 6,188,441  
               
CASH FLOWS FROM INVESTING ACTIVITIES:              
Purchases of property, plant and equipment, net   (562,717 )     (709,881 )
Payment for construction in progress   (72,188 )     (246,971 )
Certificate of deposit   (19,001,959 )     (15,759,448 )
Net cash used in investing activities $ (19,636,864 )   $ (16,716,300 )
               
CASH FLOWS FROM FINANCING ACTIVITIES:              
Proceeds from short-term loans   5,040,000       500,000  
Repayments of short-term loans   (6,398,565 )      
Contribution from non-controlling shareholder         803,732  
Purchase of treasury stock         (1,583,561 )
Net cash used in by financing activities $ (1,358,565 )   $ (279,829 )
               
NET DECREASE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH $ (13,633,231 )   $ (10,807,688 )
Effect of exchange rate changes $ 676,206     $ 352,415  
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT BEGINNING OF YEAR $ 151,040,271     $ 168,676,007  
               
CASH AND CASH EQUIVALENTS AND RESTRICTED CASH AT END OF PERIOD $ 138,083,246     $ 158,220,734  
-CASH AND CASH EQUIVALENTS AT END OF PERIOD   75,133,544       99,997,938  
-RESTRICTED CASH AT END OF PERIOD   62,949,702       58,222,796  
               
SUPPLEMENTARY CASH FLOW INFORMATION              
Income taxes paid $ 17,433     $ 5,496  
Interest paid $ 99,960     $ 37,116  
               
               
               
SUPPLEMENTAL NON-CASH DISCLOSURES:              
Contribution from non-controlling shareholder by inventories, fixed assets and intangible assets $     $ 393,986  


Go to Source