- Q3 EV parts sales increased 35.7% year-over-year to $49.0
million - Q3 operating cash flow reached $11.6 million - Q3 the JV
Company sold 6,004 EV products, a 208% increase year-over-year -Q3
EV products direct sales increased 367.2% quarter-over-quarter
Kandi Technologies Group, Inc. (NASDAQ GS:KNDI)
(the "Company," "we" or "Kandi"), today announced its financial
results for the quarter ended September 30, 2015.
Third Quarter 2015 Highlights
- Total revenues grew 14.3% to $50.5 million for the third
quarter of 2015 from $44.2 million for the same period of 2014;
- Electric Vehicle ("EV") parts sales increased 35.7% to $49.0
million for the third quarter of 2015, compared with $36.1 million
in the same period of 2014;
- Kandi Electric Vehicles Group Co., Ltd. (the "JV Company"),
sold 6,004 EV products, a 208% increase compared with the same
period last year. Total EV product sales comprised 3,000 EV
products to the Micro Public Transportation (MPT) program and 3,004
EV products through the distribution channel under its direct sales
program, with the latter being a significant sequential increase of
367.2% over the 643 EV products sold through the distribution
channel under the direct sales program in the second quarter.
- GAAP net income for the third quarter of 2015 was $2.3 million,
or approximately $0.05 per fully diluted share, compared with $13.5
million, or approximately $0.31 per fully diluted share in the same
period of 2014. The decrease was mainly due to changes in
stock-based compensation expenses and the fair value of the
financial derivatives during the period;
- Non-GAAP adjusted net income1, which excludes stock award
expenses and changes in the fair value of financial derivatives,
was $6.3 million, a 17.7% increase from $5.4 million in the same
quarter of 2014. Non-GAAP adjusted earnings per share1 was
approximately $0.13 per fully diluted share for the third quarter
of 2015 compared with $0.12 per fully diluted share for the same
quarter of 2014;
- Working capital surplus was $54.2 million as of September 30,
2015;
- Cash, cash equivalents and restricted cash totaled $27.4
million as of September 30, 2015.
"The third quarter performance underscores our tremendous growth
in EV parts and EV sales as we became China's top seller for EV
products in September," commented Mr. Hu Xiaoming, Chairman and
Chief Executive Officer of Kandi, "During the third quarter, we
obtained the approval for a vehicle purchase tax exemption for
Kandi Cyclone ("K17"), while launching a successful promotion in
Beijing and Shanghai. The initial market response has been
extremely positive, and we believe K17 will become the Company's
key driver for growth over the next year. Meanwhile, China's
central government has extended its continuous support and
confidence in developing the new energy vehicle (NEV) industry by
releasing additional policies, including reducing traffic controls
and purchase quotas on NEVs, encouraging government purchases, and
promoting EV car-share programs. With the government's dedication,
we see unprecedented opportunities ahead of us, and we are
well-positioned to benefit from the EV adoption in China by
leveraging our unique growth engines: the rapid expansion of our
Micro Public Transportation program and the burgeoning direct sales
program through the distribution channel."
"We are very pleased to achieve strong financial results in the
third quarter of 2015," added Mr. Wang Cheng, Chief Financial
Officer of Kandi, "Both sales and gross margin were in line with
our expectations. With positive operating cash flow of $11.6
million, we are fully prepared for the significant growth potential
around the corner."
Third Quarter 2015 Financial Results:
Net Revenues and Gross Profit
|
|
|
3Q15 |
2Q15 |
2Q14 |
Q-o-Q% |
Y-o-Y% |
Net Revenues (US$mln) |
$50.53 |
$47.96 |
$44.21 |
5.3% |
14.3% |
Gross Profit (US$mln) |
$7.12 |
$6.49 |
$5.51 |
9.6% |
29.2% |
Gross Margin |
14.1% |
13.5% |
12.5% |
-- |
-- |
Net revenues increased 5.3% sequentially from the second quarter
of 2015 due to the sales growth of EV products from the JV Company.
Gross margin increased 0.6% sequentially as a result of the cost
control from battery packing production. Gross margin increased
1.6% year-over-year due to the margin improvement from EV parts,
which was mainly contributed by effective cost control and the
scaled production. Gross margin growth was partially offset by the
sales decrease in off-road vehicles and EV products sales, with the
latter being completely transferred to the JV Company this year per
the Joint Venture Agreement.
Operating Income (Loss)
|
|
3Q15 |
2Q15 |
3Q14 |
Q-o-Q% |
Y-o-Y% |
Operating Expenses (US$mln) |
$9.56 |
$4.49 |
$2.90 |
112.8% |
229.6% |
Operating Income (Loss) (US$mln) |
($2.44 ) |
$ 2.00 |
$ 2.61 |
-222.1% |
-193.6% |
Operating Margin |
-4.8% |
4.2% |
5.9% |
-- |
-- |
Total operating expenses were $9.6 million, compared with $4.5
million in the second quarter of 2015, and $2.9 million in the
third quarter of 2014. The significant increase in total operating
expenses was mainly due to the $7.0 million expenses for stock
award compensation and $0.5 million in legal expenses in the third
quarter of 2015.
GAAP Net Income
|
|
3Q15 |
2Q15 |
3Q14 |
Q-o-Q% |
Y-o-Y% |
Net Income (US$mln) |
$2.34 |
$5.43 |
$13.53 |
-56.8% |
-82.7% |
Earnings per Weighted Average Common
Share |
$0.05 |
$0.12 |
$0.31 |
-- |
-- |
Earnings per Weighted Average Diluted
Share |
$ 0.05 |
$ 0.12 |
$ 0.31 |
-- |
-- |
Non-GAAP Net Income
|
|
3Q15 |
2Q15 |
3Q14 |
Q-o-Q% |
Y-o-Y% |
GAAP net income from continuing
operations |
$2.34 |
$5.43 |
$13.53 |
-56.8% |
-82.7% |
Stock award expenses |
$7.03 |
$3.48 |
$2.02 |
101.9% |
247.1% |
Change of the fair value of financial
derivatives |
$ 3.05 |
$ 4.00 |
$ 10.19 |
-23.8% |
-70.1% |
Non-GAAP net income (loss) from
continuing operations |
$6.32 |
$4.90 |
$5.37 |
28.9% |
17.7% |
Net income was $2.3 million, compared with $5.4 million in the
second quarter of 2015, and $13.5 million in the third quarter of
2014. The decrease in net income was mainly due to the $7.0 million
expenses for the stock award compensation in the third quarter of
2015. Non-GAAP net income was $6.3 million, a 28.6% increase from
$4.9 million in the second quarter of 2015 and 16.7% increase from
$5.4 million in the third quarter of 2014. The increase in non-GAAP
net income was in line with the revenue growth and the margin
improvements.
JV Company Financial Results
In the third quarter, the JV Company sold 6,004 EV products, a
208% increase compared with the same period last year. Total EV
product sales comprised 3,000 EV products to the Micro Public
Transportation program and 3,004 EV products through the
distribution channel under the direct sales program, with the
latter being a significant sequential increase over the 643 EV
products sold through the distribution channel under the direct
sales program in the second quarter.
The condensed financial income statement is as below:
|
|
3Q15 |
2Q15 |
3Q14 |
Q-o-Q% |
Y-o-Y% |
Net Revenues (US$mln) |
$98.45 |
$68.95 |
$46.85 |
42.8% |
110.1% |
Gross Profit (US$mln) |
$13.33 |
$10.65 |
$7.03 |
25.1% |
89.7% |
Gross Margin |
13.5% |
15.4% |
15.0% |
-- |
-- |
Net Income |
$1.61 |
$1.59 |
$4.40 |
1.6% |
-63.4% |
% of Net revenue |
1.6% |
2.3% |
9.4% |
-- |
-- |
Gross margin in the third quarter of 2015 was 13.5%, compared
with gross margin of 15.4% in the second quarter of 2015 and 15.0%
in the same period of 2014. The sequential decrease was the result
of the lower selling price to a strategic partner in the third
quarter of 2015.
We accounted for our investments in the JV Company under the
equity method of accounting as we have a 50% ownership interest in
the JV Company. As a result, we recorded 50% of the JV Company's
profit for $0.8 million for the third quarter of 2015. After
eliminating intra-entity profits and losses, our share of the after
tax profit of the JV Company was $1.2 million for the three months
ended September 30, 2015.
Outlook
For the fourth quarter 2015, Kandi expects net revenues to be in
the range of $54.0 million to $56.0 million with gross margin in
the range of 13.5% to 14.5% .
The Company also expects the JV Company to deliver 8,000 to
10,000 EV products in the fourth quarter and a total of
20,000-22,000 EV products in the full year of 2015.
This outlook reflects Kandi's current view, which is subject to
change.
Third Quarter 2015 Conference Call Details
The Company has scheduled a conference call and live webcast to
discuss the financial results at 8:00 AM (U.S. EST) on November 9,
2015 (9:00 PM Beijing time on November 9, 2015). Mr. Hu Xiaoming,
Chief Executive Officer and Mr. Wang Cheng (Henry), Chief Financial
Officer, will deliver prepared remarks, 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
- Conference ID: 13623086
- Webcast and replay:
http://public.viavid.com/index.php?id=116814
The live audio webcast of the call can also be accessed by
visiting Kandi's Investor Relations website at
http://ir.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,
Zhejiang Province, is engaged in the research and development,
manufacturing and sales of various vehicle products. Kandi has
established itself as one of China's leading manufacturers of pure
electric vehicle ("EV") products (through its joint venture), EV
parts and off-road vehicles. More information can be viewed at the
Company's corporate website at http://www.kandivehicle.com. The
Company routinely posts important information on its website.
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
securities laws, the Company does not assume a duty to update these
forward-looking statements.
Follow us on Twitter: @ Kandi_Group
1 Non-GAAP measures, including the Non-GAAP net income and
Non-GAAP EPS are defined as the financial measures excluding the
change of the fair value of financial derivatives and the effects
of the stock award expense. We supply non-GAAP information because
we believe it allows our investors to obtain a clearer
understanding of our operations. Any non-GAAP measures should not
be considered as a substitute for, and should only be read in
conjunction with, measures of financial performance prepared in
accordance with GAAP.
- Tables Below -
KANDI TECHNOLOGIES
GROUP, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
BALANCE SHEETS |
|
ASSETS |
|
|
September 30, |
December 31, |
|
2015 |
2014 |
Current assets |
|
|
Cash and cash equivalents |
$ 11,691,023 |
$ 26,379,460 |
Restricted cash |
15,689,228 |
13,000,731 |
Accounts receivable |
33,912,043 |
15,736,805 |
Inventories (net of provision for slow moving
inventory of 304,677 and 315,584 as of September 30, 2015 and
December 31, 2014, respectively) |
31,652,659 |
15,403,840 |
Notes receivable |
18,785,582 |
9,060,441 |
Other receivables |
488,621 |
238,567 |
Prepayments and prepaid expense |
240,609 |
120,761 |
Due from employees |
41,128 |
34,475 |
Advances to suppliers |
457,782 |
6,901,505 |
Amount due from JV Company, net |
76,814,162 |
51,450,612 |
TOTAL CURRENT ASSETS |
189,772,837 |
138,327,197 |
LONG-TERM ASSETS |
|
|
Plant and equipment, net |
21,788,066 |
26,215,356 |
Land use rights, net |
14,826,253 |
15,649,152 |
Construction in progress |
56,525,652 |
58,510,051 |
Long Term Investment |
1,490,477 |
-- |
Investment in JV Company |
82,273,884 |
83,309,095 |
Goodwill |
322,591 |
322,591 |
Intangible assets |
515,830 |
577,401 |
Other long term assets |
156,892 |
162,509 |
TOTAL Long-Term Assets |
177,899,645 |
184,746,155 |
TOTAL ASSETS |
$ 367,672,482 |
$ 323,073,352 |
CURRENT LIABILITIES |
|
|
Accounts payables |
$ 87,854,246 |
$ 45,772,481 |
Other payables and accrued expenses |
3,362,729 |
5,101,740 |
Short-term loans |
37,340,362 |
35,589,502 |
Customer deposits |
111,314 |
2,630,723 |
Notes payable |
3,137,846 |
5,702,121 |
Income tax payable |
2,803,621 |
1,835,685 |
Due to employees |
12,862 |
15,787 |
Deferred taxes liabilities |
256,049 |
230,864 |
Financial derivate - liability |
540,299 |
2,245,610 |
Deferred income |
34,954 |
-- |
Total Current
Liabilities |
135,454,282 |
99,124,513 |
LONG-TERM LIABILITIES |
|
|
Deferred taxes liabilities |
402,934 |
2,266,725 |
Financial derivate - liability |
-- |
10,097,275 |
Total Long-Term
Liabilities |
402,934 |
12,364,000 |
|
|
|
TOTAL LIABILITIES |
135,857,216 |
111,488,513 |
|
|
|
STOCKHOLDER'S EQUITY |
|
|
Common stock, $0.001 par value; 100,000,000
shares authorized; 46,964,855 and 46,274,855 shares issued and
outstanding at September 30,2015 and December 31,2014,
respectively |
46,965 |
46,275 |
Additional paid-in capital |
202,744,428 |
190,258,037 |
Retained earnings (the restricted portion is
$4,172,324 and $4,172,324 at September 30,2015 and December
31,2014, respectively) |
30,290,776 |
16,390,424 |
|
|
|
Accumulated other comprehensive
income(loss) |
(1,266,903) |
4,890,103 |
TOTAL STOCKHOLDERS'
EQUITY |
231,815,266 |
211,584,839 |
|
|
|
TOTAL LIABILITIES AND
STOCKHOLDERS' EQUITY |
$ 367,672,482 |
$ 323,073,352 |
|
|
|
|
KANDI TECHNOLOGIES
GROUP, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
STATEMENTS OF INCOME (LOSS) AND |
COMPREHENSIVE INCOME
(LOSS) |
|
|
Three Months Ended |
Nine Months Ended |
|
September 30, |
September 30, |
September 30, |
September 30, |
|
2015 |
2014 |
2015 |
2014 |
|
|
|
|
|
REVENUES, NET |
$ 50,528,545 |
$ 44,206,992 |
$ 142,273,091 |
$ 117,338,351 |
|
|
|
|
|
COST OF GOODS SOLD |
43,411,839 |
38,698,452 |
122,294,189 |
99,748,314 |
|
|
|
|
|
GROSS PROFIT |
7,116,706 |
5,508,540 |
19,978,902 |
17,590,037 |
|
|
|
|
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
Research and development |
785,450 |
391,097 |
1,928,091 |
2,535,0 27 |
|
|
|
|
|
Selling and marketing |
122,873 |
432,365 |
312,284 |
939,516 |
|
|
|
|
|
General and administrative |
8,649,541 |
2,076,749 |
16,275,202 |
11,720,693 |
|
|
|
|
|
Total Operating Expenses |
9,557,864 |
2,900,211 |
18,515,577 |
15,195,236 |
|
|
|
|
|
INCOME (LOSS) FROM OPERATIONS |
(2,441,158) |
2,608,329 |
1,463,325 |
2,394,801 |
|
|
|
|
|
OTHER INCOME(EXPENSE): |
|
|
|
|
|
|
|
|
|
Interest income |
1,140,756 |
220,911 |
2,454,0 79 |
1,453,0 47 |
|
|
|
|
|
Interest (expense) |
(534,987) |
(932,030) |
(1,730,898) |
(2,850,341) |
|
|
|
|
|
Change in fair value of financial
instruments |
3,049,242 |
10,187,277 |
11,802,586 |
6,814,675 |
|
|
|
|
|
Government grants |
(724) |
63,584 |
92,139 |
217,284 |
|
|
|
|
|
Share of profit (loss) in associated
companies |
-- |
38,702 |
-- |
(54,290) |
|
|
|
|
|
Share of profit after tax of JV |
1,179,605 |
2,038,388 |
1,900,128 |
3,757,218 |
|
|
|
|
|
Other income, net |
988,224 |
21,814 |
1,094,278 |
141,641 |
|
|
|
|
|
Total other income (expense), net |
5,822,116 |
11,638,646 |
15,612,312 |
9,479,234 |
|
|
|
|
|
INCOME(LOSS) BEFORE INCOME TAXES |
3,380,958 |
14,246,975 |
17,075,637 |
11,874,035 |
|
|
|
|
|
INCOME TAX EXPENSE |
(1,037,763) |
(713,273) |
(3,175,287) |
(1,269,408) |
|
|
|
|
|
NET INCOME |
2,343,195 |
13,533,702 |
13,900,350 |
10,604,627 |
|
|
|
|
|
OTHER COMPREHENSIVE INCOME |
|
|
|
|
|
|
|
|
|
Foreign currency translation |
(7,098,249) |
(109,112) |
(6,157,006) |
(2,037,704) |
|
|
|
|
|
COMPREHENSIVE INCOME(LOSS) |
$ (4,755,054) |
$ 13,424,590 |
$ 7,743,344 |
$ 8,566,923 |
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
BASIC |
46,959,638 |
43,214,455 |
46,670,533 |
41,327,666 |
|
|
|
|
|
WEIGHTED AVERAGE SHARES OUTSTANDING
DILUTED |
46,959,638 |
43,530,185 |
46,945,277 |
41,462,490 |
|
|
|
|
|
NET INCOME PER SHARE, BASIC |
$ 0.05 |
$ 0.31 |
$ 0.30 |
$ 0.26 |
|
|
|
|
|
NET INCOME PER SHARE, DILUTED |
$ 0.05 |
$ 0.31 |
$ 0.30 |
$ 0.26 |
|
|
KANDI TECHNOLOGIES
GROUP, INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS |
|
|
Nine Months Ended |
|
September 30, |
September 30, |
|
2015 |
2014 |
|
|
|
CASH FLOWS FROM
OPERATING ACTIVITIES: |
|
|
Net income |
$ 13,900,350 |
$ 10,604,627 |
Adjustments to reconcile net income to net
cash provided by operating activities |
|
|
Depreciation and amortization |
4,388,902 |
4,157,606 |
Assets Impairments |
-- |
|
Deferred taxes |
(1,854,863) |
808,725 |
Change in fair value of financial
instruments |
(11,802,586) |
(6,814,675) |
Loss (income) in investment in associated
companies |
-- |
54,290 |
Share of loss after tax of JV Company |
(1,900,128) |
(3,757,218) |
Stock Compensation cost |
12,486,881 |
-- |
|
|
|
Changes in operating assets
and liabilities, net of effects of
acquisition: |
|
|
(Increase) Decrease In: |
|
|
Accounts receivable |
(19,286,512) |
17,190,113 |
Inventories |
(17,289,849) |
(5,480,008) |
Other receivables |
(298,976) |
105,092 |
Due from employee |
(10,535) |
413,441 |
Prepayments and prepaid expenses |
6,265,899 |
(49,927,475) |
Amount due from JV Company |
(27,964,497) |
(49,177,160) |
|
|
|
Increase (Decrease) In: |
|
|
Accounts payable |
44,980,746 |
32,911,627 |
Other payables and accrued liabilities |
(1,302,135) |
2,441,464 |
Customer deposits |
(2,502,087) |
108,031 |
Income Tax payable |
1,062,643 |
(36,060) |
Net cash (used in ) provided
by operating activities |
$ (1,126,747) |
$ (46,397,580) |
|
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES: |
|
|
(Purchases)/Disposal of plant and equipment,
net |
(408,850) |
(813,246) |
Purchases of land use rights |
-- |
(1,667,986) |
Purchases of construction in progress |
(39,054) |
(39,283) |
Disposal of associated company |
-- |
(96,268) |
Issuance of notes receivable |
(72,040,444) |
(21,698,986) |
Repayment of notes receivable |
61,697,894 |
29,344,951 |
Long Term Investment |
(1,535,651) |
-- |
Net cash provided by (used
in) investing activities |
$ (12,326,105) |
$ 5,029,182 |
CASH FLOWS FROM
FINANCING ACTIVITIES: |
|
|
Restricted cash |
(3,232,950) |
(13,006,018) |
Proceeds from short-term bank loans |
30,583,709 |
28,616,816 |
Repayments of short-term bank loans |
(27,512,406) |
(39,998,504) |
Proceeds from notes payable |
9,860,498 |
13,007,644 |
Repayment of notes payable |
(12,299,436) |
(16,584,746) |
Option exercise, stock awards & other
financing |
-- |
6,429,622 |
Warrant exercise |
-- |
22,447,914 |
Common stock issued for acquisition, net of
cost of capital |
-- |
78,155,627 |
Net cash (used in) provided
by financing activities |
$ (2,600,585) |
$ 79,068,355 |
|
|
|
NET INCREASE IN CASH AND
CASH EQUIVALENTS |
(16,053,437) |
37,699,957 |
Effect of exchange rate changes on cash |
1,365,000 |
(961,614) |
Cash and cash equivalents at beginning of
year |
26,379,460 |
12,762,369 |
|
|
|
CASH AND CASH
EQUIVALENTS AT END OF PERIOD |
11,691,023 |
49,500,712 |
|
|
|
SUPPLEMENTARY CASH
FLOW INFORMATION |
|
|
Income taxes paid |
1,794,115 |
1,305,468 |
Interest paid |
1,718,257 |
1,748,140 |
CONTACT: Company Contact:
Ms. Kewa Luo
Kandi Technologies Group, Inc.
Phone: 1-212-551-3610
Email: IR@kandigroup.com
IR Contact:
The Piacente Group
Phone: 1-212-481-2050
Email: kandi@tpg-ir.com
Kandi Technolgies (NASDAQ:KNDI)
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From Aug 2024 to Sep 2024
Kandi Technolgies (NASDAQ:KNDI)
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From Sep 2023 to Sep 2024