SHENZHEN, China, Nov. 13, 2020 /PRNewswire/ -- TD Holdings,
Inc. (Nasdaq: GLG) (the "Company"), a commodities trading
and supply chain management service provider
in China today announced its financial results for the
nine months ended September 30, 2020.
Affected by the ongoing outbreak of the COVID-19, the Company
expected its used luxurious car leasing business to be subject to
continuous losses due to the closure of stores. As a result, the
Company sold the used luxurious car leasing business in
August 2020 and focus on the
commodities trading and its complementary business.
Mrs. Renmei Ouyang, the Chief
Executive Officer of the Company, stated, "We are pleased to report
our financial results for the nine months ended September 30, 2020. We started our commodities
trading business in late 2019. We have successfully achieved net
income from our continuing operations in the third quarter of 2020.
We plan on continuing to develop our commodities trading
business in terms of volume, revenues and net profit, and increase
its value to our stockholders. In addition, our recent acquisition
of Shenzhen Qianhai Baiyu Supply Chain Co., Ltd. has laid a solid
foundation for us to further expand our supply chain business in
areas including warehousing, logistics, processing, and providing
supply chain financing to downstream clients. We expect Qianhai
Baiyu to synergize well with Huamucheng's existing operations as
the two businesses will be able to share customer resources and
sales channels, increasing our cost efficiency."
Financial Highlights
In the quarter ended September 30,
2020
- Revenues from commodities trading business was $7.21 million, consisting of $3.68 million from sales of commodities products,
and $3.53 million from supply chain
management services for the quarter ended September 30, 2020;
- Net income from continuing operations was $4.17 million, as compared with net loss from
continuing operations of $0.26
million for the same period ended September 30, 2019. Net income was $1.18 million, as compared with net loss of
$0.39 million for the same period
ended September 30, 2019;
- Basic and diluted earnings per share from continuing operations
was $0.07, compared with basic and
diluted loss per share from continuing operations of $0.03 for the same period ended September 30, 2019. Basic and diluted earnings
per share was $0.02, compared with
basic and diluted loss per share of $0.05 for the same period ended September 30, 2019; and
- Shareholders' equity as of September 30,
2020 was $93.9 million, an
increase of 1,518.97% compared with $5.8
million as of December 31,
2019.
In the nine months ended September 30,
2020
- Revenues from commodities trading business was $12.39 million, consisting of $6.30 million from sales of commodities products,
and $6.09 million from supply chain
management services for the quarter ended September 30, 2020;
- We raised funds aggregating $30
million from issuance of convertible notes, accompanied by
warrants to purchase 20,000,000 shares of Common Stock issuable
upon exercise of the warrants at an exercise price of $1.80, and raised $36
million from the holders of convertible notes upon their
conversion of the convertible notes and exercise of the warrants.
We therefore incurred noncash amortization of beneficial conversion
feature of $3.4 million and
amortization of relative fair value of warrants of $3.06 million;
- Net income from continuing operations was $0.22 million, as compared with net loss from
continuing operations of $2.12
million for the same period ended September 30, 2019. Net loss was $3.32 million, as compared with $3.26 million for the same period ended
September 30, 2019; and
- Basic and diluted earnings per share from continuing operations
was $0.01, compared with basic and
diluted loss per share from continuing operations of $0.30 for the same period ended September 30, 2019. Basic and diluted loss per
share was $0.08, compared with basic
and diluted loss per share of $0.46
for the same period ended September 30,
2019.
Financial Results
In the three months ended September
30, 2020
Revenues
For the three months ended September 30,
2020, the Company sold non-ferrous metals to six customers
at fixed prices, and earned revenues when the product ownership was
transferred to its customers. The Company earned revenues of
$3,680,944 from sales of commodity
products. There was no such revenue for the three months ended
September 30, 2019.
For the three months ended September 30,
2020, the Company earned distribution commission fees of
$3,531,885 from facilitating metal
product sales between the suppliers and the customers, and did not
earn revenues from loan recommendation services.
Cost of revenue
Cost of revenue primarily consists of purchase costs of
non-ferrous metal products and business taxes and surcharges. For
the three months ended September 30,
2020, the Company purchased non-ferrous metal products
of $3,617,068 from two third party
suppliers, and sold non-ferrous metal products to four customers.
The Company recorded cost of revenue of $3,697,490. There was no such cost for the three
months ended September 30, 2019
because this was a new business launched in December 2019.
Selling, general, and administrative expenses
Selling, general and administrative expenses increased from
$259,945 for the three months ended
September 30, 2019 to $292,080 for the three months ended
September 30, 2020, representing an
increase of $32,135, or 12%.
Selling, general and administrative expenses primarily
consisted of salary and employee benefits, office rental expense,
business tax and surcharge, professional service fees, office
supplies. The increase was mainly attributable to an increase of
$79,098 in rental expenses with our
launch of our commodities trading business, against a decrease
of salary and payroll expenses of $27,012 because our new senior management charged
less salary expenses.
Interest income
Interest income was primarily generated from loans made to third
parties and related parties. For the three months ended
September 30, 2020, interest income
was $2,356,000, as compared with $nil
for the same period ended September 30,
2019. The increase was primarily due to net loans of
$83.3 million made to a customer,
from which the Company earned interest income of $2.4 million.
Net loss from discontinued operations
During the three months ended September
30, 2020, the net loss from discontinued operations was
comprised of a net loss of $nil from discontinued operations of the
used luxurious car leasing business and a loss of $2,989,116 from disposal of the discontinued
operations of used luxurious car leasing business.
During the three months ended September
30, 2019, the net loss from discontinued operations was
comprised of a net loss of $132,898
from discontinued operations of the used luxurious car leasing
business.
Net loss
Net income from continuing operations for the three months ended
September 30, 2020 was $4,170,658, representing a change of $4,430,603 from net loss from continuing
operations of $259,945 for the three
months ended September 30, 2019.
Net income for the three months ended September 30, 2020 was $1,181,542, representing a change of $1,574,385 from net loss of $392,843 for the three months ended September 30, 2019.
In the nine months ended September 30,
2020
Revenues
For the nine months ended September 30,
2020, the Company sold non-ferrous metals to six customers
at fixed prices, and earned revenues when the product ownership was
transferred to its customers. The Company earned revenues of
$6,298,245 from sales of commodity
products. There was no such revenue for the nine months ended
September 30, 2019.
For the nine months ended September 30,
2020, the Company earned $2,332,735 from loan recommendation services from
the facilitation of a loan volume of approximately $93.3 million (RMB 652.8
million) with five customers, and earned distribution
commission fees of $3,760,338 from
facilitating the metal product sales between the suppliers and the
customers.
Cost of revenue
Cost of revenue primarily consists of purchase costs of
non-ferrous metal products and business taxes and surcharges. For
the nine months ended September 30,
2020, the Company purchased non-ferrous metal products of
$6,233,590 from three third party
suppliers, and sold non-ferrous metal products to six customers.
The Company recorded cost of revenue of $6,322,765. There was no such cost for the
nine months ended September 30, 2019
because this was a new business launched in December 2019.
Selling, general, and administrative expenses
Selling, general and administrative expenses decreased from
$2,123,191 for the nine months ended
September 30, 2019 to $1,032,660 for the nine months ended September 30, 2020, representing a decrease of
$1,090,531, or 51%. Selling,
general and administrative expenses primarily consisted of salary
and employee benefits, office rental expense, business tax and
surcharge, professional service fees, office supplies. The decrease
was mainly attributable to a decrease of stock-based compensation
expenses of $884,208, because we
issued 502,391 restricted shares as compensation of $884,208 to certain service providers for the
nine months ended September 30, 2019,
while no such issuance was made for the nine months ended
September 30, 2020, and a decrease of
$112,061 in salary and payroll
expenses because the new senior management of the Company charged
less payroll expenses.
Interest income
Interest income was primarily generated from loans made to third
parties and related parties. For the nine months ended September 30, 2020, interest income was
$3,965,283, representing an increase
of $3,964,647 from $636 for the nine months ended September 30, 2019. The increase was primarily
due to net loans of $83.3
million made to a customer. The Company earned interest income
of $3.82 million from this
customer.
Amortization of beneficial conversion feature and relative
fair value of warrants relating to issuance of convertible
notes
For the nine months ended September 30,
2020, there was amortization of beneficial conversion
feature of $3.4 million and relative
fair value of warrants relating to issuance of convertible notes of
$3.06 million relating to the
convertible notes which were converted in May 2020.
For the nine months ended September 30,
2020, no such expenses were incurred.
Net loss from discontinued operations
During the nine months ended September
30, 2020, the net loss from discontinued operations was
comprised of net loss of $552,691
from discontinued operations of used luxurious car leasing business
and a loss of $3,541,807 from
disposal of the discontinued operations of the used luxurious car
leasing business.
During the nine months ended September
30, 2019, the net loss from discontinued operations was
comprised of net loss of $1,140,439
from discontinued operations of the used luxurious car leasing
business.
Net loss
Net income from continuing operations for the nine months ended
September 30, 2020 was $222,119, representing a change of $2,344,674 from net loss from continuing
operations of $2,122,555 for the nine
months ended September 30, 2019.
Net loss for the nine months ended September 30, 2020 was $3,319,688, representing an increase of
$56,694 from net loss of $3,262,994 for the nine months ended September 30, 2019.
Nine Months Ended September 30,
2020 Cash Flows
As of September 30, 2020, the
Company had cash and cash equivalents of $2.97 million, as compared with $1.78 million as of December 31, 2019.
Net cash provided by operating activities from continuing
operations was $1.64 million for the
nine months ended September 30, 2020,
as compared with cash used in operating activities from continuing
operations of $1.20 million for the
same period of 2019. Net cash provided by operating activities was
$0.94 million for the nine months
ended September 30, 2020, as compared
with cash used in operating activities from continuing operations
of $2.02 million for the same period
of 2019.
Net cash used in investing activities was $81.71 million for the nine months ended
September 30, 2020, compared to
$5.46 million for the same period of
2019.
Net cash provided by financing activities was $81.05 million for the nine months ended
September 30, 2020, compared to
$7.40 million for the same period of
2019.
About TD Holdings, Inc.
TD Holdings, Inc. (Nasdaq: GLG) is a commodities trading
and supply chain management service provider in China. Our commodities trading and supply
chain management businesses are conducted under the brand names
"Huamucheng" by Shenzhen Huamucheng Trading Co., Ltd. and "Qianhai
Baiyu" by Shenzhen Qianhai Baiyu Supply Chain Co., Ltd., the
Company's wholly owned subsidiaries in Shenzhen. For more information please visit
http://ir.tdglg.com.
Safe Harbor Statement
This press release may contain certain "forward-looking
statements" relating to the business of TD Holdings, Inc. and its
subsidiary companies. 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, involve 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. Investors 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 those discussed in the Company's periodic reports that
are filed with the Securities and Exchange Commission and available
on its website at 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 factors. Other than as required under the
securities laws, the Company does not assume a duty to update these
forward-looking statements.
View original
content:http://www.prnewswire.com/news-releases/td-holdings-inc-reports-third-quarter-2020-financial-results-301172644.html
SOURCE TD Holdings, Inc.