Net Revenue increased by 57%
Number of vehicles sold increased 30% year over
year
Management to Host Conference Call on Monday,
April 25 at 5:00 p.m. ET
Cenntro Electric Group Limited (NASDAQ: CENN) (“Cenntro” or “the
Company”), a leading EV technology company with advanced,
market-validated electric commercial vehicles, today announced its
financial results for the year ended December 31, 2021.
Full Year 2021 Operational and Financial Highlights
- The number of commercial vehicles sold was 918 units, an
increase of 29.8% from 707 units sold in 2020.
- Net revenue was $8.6 million, an increase of 57.1% from
$5.5 million in 2020.
- Gross margin was 17.5%, up 7.1 percentage points from
10.4% in 2020.
- Cash and cash equivalents were $261.1 million as of
December 31, 2021, compared with $4.5 million as of December 31,
2020.
“2021 was a year of significant progress for Cenntro as we
successfully became a publicly traded company following our stock
purchase transaction with Naked Brand Group. The transaction
provided Cenntro with over $250 million of cash on hand to fund
capacity expansion and to support our growth initiatives,” said
Peter Wang, Chief Executive Officer.
“We achieved strong operational performance in 2021, highlighted
by 918 commercial electric vehicles sold, an increase of
approximately 30% from the prior year. We also continue to ramp up
capacity with the addition of our Jacksonville facility, and an
assembly facility in Germany, and further strengthened our
distribution and customer network through our strategic acquisition
of a majority interest in Tropos Motors Europe GmbH,” concluded
Peter Wang.
“While our 2021 operating results were negatively impacted by
higher material and shipping costs and shipping container shortages
and supply-chain disruptions, we are pleased to have delivered
revenue and gross margin improvement driven by increased vehicle
sales and other service income. Notably, our revenue grew 57%
year-over-year to $8.6 million in 2021 while our gross margin
increased by 7.1 percentage points to 17.5%. Our 2021 results
demonstrate our ability to manage our production despite the
challenges arising out of the COVID-19 pandemic. In addition to
scaling production, we are supporting future revenue growth with
increased sales and marketing initiatives,” added Edmond Cheng,
Chief Financial Officer.
Recent Developments & 2021 Business Highlights
- Acquisition of Majority Interest of Tropos Motors Europe
In March 2022, Cenntro completed the previously announced
acquisition of a 65% equity interest in Tropos Motors Europe GmbH
(“TME”), a wholly owned subsidiary of Mosolf SE & Co. KG
(“Mosolf”), one of Europe’s largest automotive logistics and
service providers. The transaction expands Cenntro’s assembling
capabilities in Herne, Germany, and distribution network in EMEA
and brings an additional strategic customer network in Europe.
- Cenntro became a Publicly Traded Company On Dec 31,
2021, Cenntro became a publicly traded company on the Nasdaq
Capital Market (“Nasdaq”) through a stock purchase transaction with
Naked Brand Group. The combined company is led by Cenntro CEO Peter
Wang and Cenntro’s executive team as Naked Brand Group’s online
business was divested. Cenntro’s trading symbol on NASDAQ changed
from “NAKD” to “CENN” in January 2022.
- Production Milestone of 1,623 Electric Commercial
Vehicles Cenntro achieved a production milestone of 1,623
electric commercial vehicles (“ECVs”) for 2021, with its highest
volume month of 628 ECVs produced in December 2021.
- Jacksonville, Florida Selected as Location for a new U.S.
Manufacturing Facility In January 2022, Cenntro leased a new
assembly facility in Jacksonville, Florida. The 100,000-square-foot
facility will support U.S. production, with a possible expansion to
support additional vehicles assembly and battery packing
operations.
- New vehicle model development The Company has continued
to develop and introduce new vehicle models to meet market demand.
Cenntro developed four new vehicle models: Neibor® 150, Logistar™
200, Logistar™ 400, and Teemak™.
Full Year 2021 Financial Results
Net Revenues
Net revenue was $8.6 million for 2021, an increase of 57.1% from
$5.5 million in 2020. The increase was primarily due to an increase
in vehicle sales and an increase in service revenue.
Cost of goods sold
Cost of goods sold was $7.1 million 2021, an increase of 44.7%
from $4.9 million in 2020. The increase was primarily due to an
increase in the number of vehicles sold to our channel
partners.
Gross profit
Gross profit was $1.5 million in 2021, an increase of 164% from
$0.6 million in 2020. Gross margin was 17.5% in 2021, up 7.1
percentage points from 10.4% in 2020. The increase was primarily
driven by an increase in vehicle sales, particularly an increase in
sales volume of our Metro® vehicle in the US market and an increase
in service revenue.
Operating expenses
Total operating expenses were $18.0 million in 2021, an increase
of 60% from $11.2 million in 2020. The increase was mainly due to
an increase in selling and marketing expenses due to an increase in
freight costs and general and administrative expenses relating to
transaction expenses in connection with Cenntro’s combination with
Naked Brand Group (the “Combination”) and the related Nasdaq
listing and the expansion of its U.S. operations.
- Selling and marketing expenses were $1.0 million, an increase
of 32.0% from $0.8 million in 2020. The increase was primarily due
to an increase in freight costs related to shipping container
shortages caused by COVID-19, and an increase in marketing expense
in connection with our efforts to expand our product market and
grow our channel partner network.
- General and administration expenses were $15.0 million, an
increase of 71.5% from $8.7 million in 2020. The increase was
mainly due to transaction expenses related to the Combination and
the related Nasdaq listing and an increase in salaries related to
the Company’s expansion of administrative operations in the United
States. The increase was offset by the non-recurrence of
depreciation expense and share-based compensation in 2021.
- Research and development expenses were $1.5 million, an
increase of 8.3% from $1.4 million in 2020. The increase was mainly
due to increases in design and development expenses and salary
expenses offset by a decrease in share-based compensation in
2021.
Net income (loss)
Net loss was $16.4 million, compared with net loss of $5.2
million in 2020.
Adjusted EBITDA1
1
Represents a non-GAAP financial measure.
For additional information about non-GAAP measures, including,
where applicable, reconciliations to the most directly comparable
financial measures presented in accordance with U.S. GAAP, please
see “Non-GAAP Measures” below.
Adjusted EBITDA was $(7.0) million in 2021, compared with
Adjusted EBITDA of ($5.6) million in 2020.
Cash, cash equivalents and restricted cash balances
Cash and cash equivalents were $261.1 million as of December 31,
2021, compared with $4.5 million as of December 31, 2020.
Full Year 2021 Results Conference Call
Cenntro Electric Group CEO Peter Wang, and CFO Edmond Cheng will
host the conference call followed by a question-and-answer
period.
Please register in advance of the conference call using the link
provided below. Conference access information will be provided upon
registration. Participant Online Registration:
http://apac.directeventreg.com/registration/event/6057659
The conference call will be broadcast live and available for
replay at https://edge.media-server.com/mmc/p/wfm3z4ky and via the
investor relations section of the Company's website at
ir.cenntroauto.com. A replay of the conference call will be
available after 8:00 p.m. Eastern time through May 4, 2022.
Toll-free replay number
1-646-254-3697
International replay number
+61 2 8199-0299
Hong Kong
+852 800963117
Mainland China
+86 4008209035 or +86
8009880552
Replay ID
6057659
About Cenntro Electric Group Ltd.
Cenntro Electric Group Ltd. (or “Cenntro”) (NASDAQ: CENN) is a
leading designer and manufacturer of electric light and medium-duty
commercial vehicles. Cenntro’s purpose-built ECVs are designed to
serve a variety of organizations in support of city services,
last-mile delivery and other commercial applications. Cenntro plans
to lead the transformation in the automotive industry through
scalable, decentralized production, and smart driving solutions
empowered by the Cenntro iChassis. As of December 31, 2021, Cenntro
has sold or put into service more than 3,700 vehicles in over 25
countries across North America, Europe and Asia. For more
information, please visit Cenntro’s website at:
http://www.cenntroauto.com.
Forward-Looking Statements
This communication contains "forward-looking statements" within
the meaning of the safe harbor provisions of the U.S. Private
Securities Litigation Reform Act of 1995. Forward-looking
statements include all statements that are not historical facts.
Such statements may be, but need not be, identified by words such
as "may,'' "believe,'' "anticipate,'' "could,'' "should,''
"intend,'' "plan,'' "will,'' "aim(s),'' "can,'' "would,''
"expect(s),'' "estimate(s),'' "project(s),'' "forecast(s)'',
"positioned,'' "potential,'' "goal,'' "strategy,'' "outlook'' and
similar expressions. Examples of forward-looking statements
include, among other things, statements regarding assembly and
distribution capabilities, decentralized production and fully
digitalized autonomous driving solutions. All such forward-looking
statements are based on management's current beliefs, expectations
and assumptions, and are subject to risks, uncertainties and other
factors that could cause actual results to differ materially from
the results expressed or implied in this communication. Among the
key factors that could cause actual results to differ materially
from those expressed or implied in the forward-looking statements
are the following: our limited operating history and historical
losses from operations; our ability to develop and manufacture ECVs
of sufficient quality, on schedule and on a large scale is still
evolving; our ability to introduce new models; potential delays in
launching and ramping up production of our new ECV models; our
reliance on our channel partners to market, sell and service (and
in certain cases, assemble and/or homologate) our vehicles; the
impacts of the COVID-19 pandemic on our operating results, in
particular due to the increase in shipping costs and shortages of
shipping containers and raw materials; our reliance on third party
manufacturing partners and suppliers for substantially all of our
vehicle kits and components, respectively, for our new vehicles;
our material weakness in our internal control over financial
reporting; risks associated with our global operations and
expansion, including unfavorable regulatory, political, legal,
economic, tax and labor conditions; changes in China’s economic,
political or social conditions or government policies, which could
have a material adverse effect on our business; and changes in U.S.
and international trade policies, particularly with regard to
China. For additional risks and uncertainties that could impact
Cenntro’s forward-looking statements, please see disclosures
contained in Cenntro's public filings with the SEC, including "Risk
Factors" in Cenntro's Report of Foreign Private Issuer on Form 6-K
filed with the Securities and Exchange Commission on January 5,
2022 and which may be viewed at www.sec.gov.
CENNTRO ELECTRIC GROUP LIMITED
CONSOLIDATED AND COMBINED BALANCE SHEETS (Expressed in U.S.
dollars, except for the number of shares)
December 31, 2021
December 31, 2020
Consolidated
Combined
ASSETS
Current assets:
Cash and cash equivalents
$
261,069,414
$
4,549,034
Restricted cash
595,548
-
Accounts receivable, net
2,047,560
463,333
Inventories
8,139,816
4,207,990
Prepayment and other current
assets, net
7,989,607
2,087,756
Receivable from disposal of land
use rights and
properties
-
7,724,138
Amounts due from related parties
- current
1,232,634
1,101,144
Total current assets
281,074,579
20,133,395
Non-current assets:
Equity investments
329,197
-
Plants and equipment, net
1,301,226
1,039,191
Intangible assets, net
3,313
45,430
Right-of-use assets, net
1,669,381
423,304
Amount due from related parties -
non-current
4,834,973
-
Other non-current assets, net
2,151,700
1,117,648
Total non-current
assets
10,289,790
2,625,573
Total Assets
$
291,364,369
$
22,758,968
LIABILITIES AND EQUITY
LIABILITIES
Current liabilities:
Accounts payable
$
3,678,823
$
3,722,686
Accrued expenses and other
current liabilities
4,183,263
5,743,323
Contractual liabilities
1,943,623
1,690,837
Operating lease liabilities,
current
839,330
131,014
Amounts due to related
parties
15,756,028
3,248,777
Total current
liabilities
26,401,067
14,536,637
Other non-current liabilities
700,000
-
Operating lease liabilities,
non-current
489,997
356,143
Total Liabilities
$
27,591,064
$
14,892,780
Commitments and
contingencies
EQUITY
Ordinary shares (No par value;
174,853,546 and 261,256,254 shares issued and outstanding as of
December 31, 2020 and 2021)
-
-
Additional paid in capital
374,901,939
103,113,793
Accumulated deficit
(109,735,935
)
(93,314,128
)
Accumulated other comprehensive
loss
(1,392,699
)
(1,904,839
)
Total equity attributable to
shareholders
263,773,305
7,894,826
Non-controlling interests
-
(28,638
)
Total Equity
263,773,305
7,866,188
Total Liabilities and
Equity
$
291,364,369
$
22,758,968
CENNTRO ELECTRIC GROUP LIMITED
COMBINED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS (Expressed
in U.S. dollars, except for number of shares)
For the Years Ended December
31,
2021
2020
2019
Net revenues
$
8,576,832
$
5,460,003
$
3,575,887
Cost of goods sold
(7,073,391
)
(4,889,850
)
(3,699,741
)
Gross profit/(loss)
1,503,441
570,153
(123,854
)
OPERATING EXPENSES:
Selling and marketing
expenses
(1,034,242
)
(783,763
)
(964,471
)
General and administrative
expenses
(14,978,897
)
(8,735,534
)
(10,959,203
)
Research and development
expenses
(1,478,256
)
(1,365,380
)
(2,145,884
)
Provision for doubtful
accounts
(469,702
)
(319,816
)
(3,598,506
)
Total operating
expenses
(17,961,097
)
(11,204,493
)
(17,668,064
)
Loss from operations
(16,457,656
)
(10,634,340
)
(17,791,918
)
OTHER INCOME
(EXPENSE):
Interest expense, net
(1,069,581
)
(1,411,558
)
(1,058,795
)
Income (loss) from and impairment
on equity method investments
15,167
(330,103
)
(1,235,306
)
Gain from disposal of land use
rights and properties
-
7,005,446
-
Other income, net
1,090,263
173,624
580,549
Loss before income
taxes
(16,421,807
)
(5,196,931
)
(19,505,470
)
Income tax expense
-
-
-
Net loss
(16,421,807
)
(5,196,931
)
(19,505,470
)
Less: net loss attributable to
non-controlling interests
-
(31,039
)
(39,455
)
Net loss attributable to the
Company’s shareholders
$
(16,421,807
)
$
(5,165,892
)
$
(19,466,015
)
OTHER COMPREHENSIVE
LOSS
Foreign currency translation
adjustment
512,140
1,290,855
431,153
Total comprehensive
loss
(15,909,667
)
(3,906,076
)
(19,074,317
)
Less: total comprehensive loss
attributable to non-controlling interests
-
(39,210
)
(38,393
)
Total comprehensive loss to
the Company’s shareholders
$
(15,909,667
)
$
(3,866,866
)
$
(19,035,924
)
Weighted average number of shares
outstanding, basic and diluted *
175,090,266
174,853,546
174,853,546
Loss per share, basic and diluted *
(0.09
)
(0.03
)
(0.11
)
*
The share numbers are retroactively stated
for purposes of calculating weighted average number of shares
outstanding for loss per share to reflect the outstanding shares of
Cenntro Electric Group Limited as if the equity structure of the
acquired Cenntro companies (the “Cenntro Group”) (the accounting
acquirer) was stated to reflect the number of shares of Cenntro
Electric Group Limited (the accounting acquiree) issued in the
Combination.
Non-GAAP Financial Measures
Adjusted EBITDA for the Years Ended December 31, 2021 and
2020
In addition to our results determined in accordance with U.S.
generally accepted accounting principles (“U.S. GAAP”), we believe
Adjusted EBITDA, a non-GAAP measure is useful in evaluating
operational performance. We use Adjusted EBITDA to evaluate ongoing
operations and for internal planning and forecasting purposes. We
believe that non-GAAP financial information, when taken
collectively, may be helpful to investors in assessing operating
performance.
Adjusted EBITDA is a supplemental measure of our performance
that is not required by, or presented in accordance with, U.S.
GAAP. Adjusted EBITDA is not a measurement of our financial
performance under U.S. GAAP and should not be considered as an
alternative to net income or any other performance measure derived
in accordance with U.S. GAAP. We define Adjusted EBITDA as net
income (or net loss) before net interest expense, income tax
expense, and depreciation and amortization, as further adjusted to
exclude the impact of stock-based compensation expense and other
non-recurring or extraordinary expenses, losses, charges or
gains.
We present Adjusted EBITDA because we consider it to be an
important supplemental measure of our performance and believe it is
frequently used by securities analysts, investors, and other
interested parties in the evaluation of companies in our industry.
Management believes that investors’ understanding of our
performance is enhanced by including this non-GAAP financial
measure as a reasonable basis for comparing our ongoing results of
operations. Management uses Adjusted EBITDA:
- as a measurement of operating performance because it assists us
in comparing the operating performance of our business on a
consistent basis, as it removes the impact of items not directly
resulting from our core operations;
- for planning purposes;
- to evaluate the performance and effectiveness of our
operational strategies; and
- to evaluate our capacity to expand our business.
By providing this non-GAAP financial measure, together with the
reconciliation, we believe we are enhancing investors’
understanding of our business and our results of operations, as
well as assisting investors in evaluating how well we are executing
our strategic initiatives. We caution investors that amounts
presented in accordance with our definition of Adjusted EBITDA may
not be comparable to similar measures disclosed by our competitors
because not all companies and analysts calculate Adjusted EBITDA in
the same manner. Adjusted EBITDA has limitations as an analytical
tool, and should not be considered in isolation, or as an
alternative to, or a substitute for net income or other financial
statement data presented in our financial statements as indicators
of financial performance. Some of the limitations are:
- such measures do not reflect our cash expenditures;
- such measures do not reflect changes in, or cash requirements
for, our working capital needs;
- although depreciation and amortization are recurring, non-cash
charges, the assets being depreciated and amortized will often have
to be replaced in the future and such measures do not reflect any
cash requirements for such replacements; and
- the exclusion of stock-based compensation expense, which has
been a significant recurring expense and will continue to
constitute a significant recurring expense for the foreseeable
future, as equity awards are expected to continue to be an
important component of our compensation strategy.
Due to these limitations, Adjusted EBITDA should not be
considered as a measure of discretionary cash available to us to
invest in the growth of our business. We compensate for these
limitations by relying primarily on our U.S. GAAP results and using
these non-GAAP measures only as supplemental information. As noted
in the table below, Adjusted EBITDA includes adjustments to exclude
the impact of stock-based compensation expense and other
non-recurring or extraordinary expenses, losses, charges or gains.
It is reasonable to expect that these items will occur in future
periods. However, we believe these adjustments are appropriate
because the amounts recognized can vary significantly from period
to period, do not directly relate to the ongoing operations of our
business and may complicate comparisons of our internal operating
results and operating results of other companies over time. In
addition, Adjusted EBITDA may include adjustments for other items
that we do not expect to regularly occur in future reporting
periods. Each of the normal recurring adjustments and other
adjustments described in this paragraph and in the reconciliation
table below help management with a measure of our core operating
performance over time by removing items that are not related to
day-to-day operations.
The following table reconciles Adjusted EBITDA to the most
directly comparable U.S. GAAP financial performance measure, which
is net loss:
Year Ended December
31,
2021
2020
2019
(Unaudited)
Net loss
$
(16,421,807
)
$
(5,196,931
)
$
(19,505,470
)
Interest expense, net
1,069,581
1,411,558
1,058,795
Income tax expense
—
—
—
Depreciation and amortization
632,256
1,840,980
2,071,269
Share-based compensation expense
1,128,325
3,364,217
4,923,509
Transaction expenses related to
the Combination and proposed IPO
6,559,095
—
—
Gain from disposal of land use
rights and properties
—
(7,005,446
)
—
Adjusted EBITDA
$
(7,032,550
)
$
(5,585,622
)
$
(11,451,897
)
Presentation of GAAP financial information rather than IFRS
financial information
The financial results included in this press release have been
prepared in accordance with U.S. GAAP (the “U.S. GAAP Results”). As
an Australian public limited company, we are subject to the
Corporations Act, which requires financial statements to be
prepared and audited in accordance with Australian Auditing
Standards and International Financial Reporting Standards. The
financial information in this press release are not financial
statements for the purposes of the Corporations Act and is
considered “non-IFRS financial information” under the Australian
Securities and Investment Commission’s Regulatory Guide 230:
‘Disclosing non-IFRS financial information.’ Such non-IFRS
financial information may not be comparable to similarly titled
information presented by other entities and should not be construed
as an alternative to other financial information prepared in
accordance with AAS or IFRS.
We believe that the GAAP Results, as well as Adjusted EBITDA, a
non-IFRS measure, are useful in evaluating operational performance.
We use GAAP Results and Adjusted EBITDA to evaluate ongoing
operations, for internal planning and forecasting purposes and for
informing our investors based in the United States.
Our GAAP Results are not a measurement of our financial
performance under IFRS and should not be considered as an
alternative to performance measures derived in accordance with
IFRS.
By providing this non-IFRS financial information, together with
the reconciliation, we believe we are enhancing investors’
understanding of our business and our results of operations, as
well as assisting investors in evaluating how well we are executing
our strategic initiatives. We caution investors that amounts
presented in accordance with U.S. GAAP may not be comparable to
similar measures presented in accordance with IFRS.
Adjusted EBITDA is not a measurement of our financial
performance under IFRS.
The following U.S. GAAP to IFRS reconciliation tables include
IFRS information as of and for the years ended December 31, 2021
and 2020, which IFRS information was derived from the Company’s
annual report dated 31 December 2021 filed with the Australian
Securities and Investments Commission in accordance with the
Corporations Act.
The following table reconciles our audited balance sheet under
U.S. GAAP with our audited balance sheet under IFRS as of December
31, 2021 and 2020, respectively:
As of the Year Ended December
31,
2021
2020
Balance Sheet:
U.S. GAAP
IFRS Difference
IFRS
U.S. GAAP
IFRS Difference
IFRS
Current assets
Cash and cash equivalents
$
261,069,414
-
$
261,069,414
$
4,549,034
-
$
4,549,034
Restricted cash
595,548
-
595,548
-
-
-
Accounts receivable, net
2,047,560
-
2,047,560
463,333
-
463,333
Inventories
8,139,816
-
8,139,816
4,207,990
-
4,207,990
Prepayment and other current assets,
net
7,989,607
-
7,989,607
2,087,756
-
2,087,756
Receivable from disposal of land use right
and properties
-
-
-
7,724,138
-
7,724,138
Amount due from related parties -
current
1,232,634
-
1,232,634
1,101,144
-
1,101,144
Total current assets
281,074,579
-
281,074,579
20,133,395
-
20,133,395
-
Non-current assets
-
Equity investments
329,197
-
329,197
-
-
-
Plants and equipment, net
1,301,226
-
1,301,226
1,039,191
-
1,039,191
Intangible assets, net
3,313
-
3,313
45,430
-
45,430
Right-of-use assets , net
1,669,381
-
1,669,381
423,304
-
423,304
Amount due from related parties –
non-current
4,834,973
4,834,973
-
-
Other non-current assets, net
2,151,700
-
2,151,700
1,117,648
-
1,117,648
Total non-current assets
10,289,790
10,289,790
2,625,573
2,625,573
Total assets
$
291,364,369
$
291,364,369
$
22,758,968
$
22,758,968
Current liabilities
Accounts payable
3,678,823
-
3,678,823
3,722,686
-
3,722,686
Accrued expense and other current
liabilities
4,183,263
-
4,183,263
5,743,323
-
5,743,323
Contractual liabilities
1,943,623
-
1,943,623
1,690,837
-
1,690,837
Operating lease liabilities, current
839,330
-
839,330
131,014
-
131,014
Amount due to related parties
15,756,028
-
15,756,028
3,248,777
-
3,248,777
Total current liabilities
26,401,067
26,401,067
14,536,637
14,536,637
Non-current liabilities
Other non-current liabilities
700,000
700,000
-
-
-
Operating lease liabilities,
non-current
489,997
489,997
356,143
356,143
Total non-current liabilities
1,189,997
1,189,997
356,143
356,143
Total liabilities
$
27,591,064
$
27,591,064
$
14,892,780
$
14,892,780
Equity
Ordinary Shares (No par value;
261,256,254 shares issued and outstanding as of December 31,
2021)
-
-
-
1,000
-
1,000
Additional paid-in capital
374,901,939
186,157,104 (1)
561,059,043
103,112,793
(22,144,502
)
80,969,291
Accumulated other comprehensive loss
(1,392,699
)
1,392,699
-
(1,904,839
)
1,904,839
-
Reserves
-
21,880,128 (2)
21,880,128
-
20,239,663 (3)
20,239,663
Accumulated deficit
(109,735,935
)
(209,429,931
)
(319,165,866
)
(93,314,128
)
-
(93,314,128
)
Total Stockholders' Equity
263,773,305
263,773,305
7,894,826
7,894,826
Noncontrolling interest
-
-
-
(28,638
)
-
(28,638
)
Total Equity
263,773,305
263,773,305
7,866,188
7,866,188
Total Liabilities and Equity
$
291,364,369
$
291,364,369
$
22,758,968
$
22,758,968
(1)
Includes $(23,272,827) in share-based
compensation payments and additional equity of $209,429,931
recognized from the difference between the deemed transaction price
and net assets acquired related to the Combination under IFRS.
(2)
Includes (i) a restatement of Accumulated
other comprehensive loss under U.S. GAAP of $(1,392,699) to
Reserves and (ii) $23,272,827 in share-based compensation payments
under IFRS.
(3)
Includes (i) a restatement of Accumulated
other comprehensive loss under U.S. GAAP of $(1,904,839) to
Reserves and (ii) $22,144,502 in share-based compensation payments
under IFRS.
The following table reconciles our statement of operations under
U.S. GAAP with our statement of operations under IFRS for the years
ended December 31, 2021 and 2020, respectively:
For the Year Ended December
31,
2021
2020
Statement of Operations:
U.S. GAAP
IFRS Difference
IFRS
U.S. GAAP
IFRS Difference
IFRS
Net revenues
$
8,576,832
-
$
8,576,832
$
5,460,003
-
$
5,460,003
Cost of goods sold
(7,073,391)
-
(7,073,391)
(4,889,850)
-
(4,889,850)
Gross Profit
1,503,441
1,503,441
570,153
570,153
Selling and marketing expenses
(1,034,242)
-
(1,034,242)
(783,763)
-
(783,763)
General and administrative expenses
(14,978,897)
-
(14,978,897)
(8,735,534)
-
(8,735,534)
Research and development expenses
(1,478,256)
-
(1,478,256)
(1,365,380)
-
(1,365,380)
Provision for doubtful accounts
(469,702)
-
(469,702)
(319,816)
-
(319,816)
Total operating expenses
(17,961,097)
-
(17,961,097)
(11,204,493)
-
(11,204,493)
Loss from operations
(16,457,656)
(16,457,656)
10,634,340)
(10,634,340)
Interest expense, net
(1,069,581)
-
(1,069,581)
(1,411,558)
-
(1,411,558)
Other income, net
1,090,263
-
1,090,263
173,624
-
173,624
Income (loss) from and impairment on
equity method investments
15,167
-
15,167
(330,103)
-
(330,103)
Cost of listing on reverse acquisition
-
(209,429,931)
(209,429,931)
-
-
-
Gain from disposal of land use rights and
properties
-
-
-
7,005,446
-
7,005,446
Loss before income taxes
(16,421,807)
(225,851,738)
(5,196,931)
(5,196,931)
Income tax (expense) benefit
-
-
-
-
-
-
Net loss
(16,421,807)
(225,851,738)
(5,196,931)
(5,196,931)
Less: Net loss attributable to
non-controlling interests
-
-
-
(31,039)
-
(31,039)
Net loss attributable to
shareholders
$
(16,421,807)
$
(225,851,738)
$
(5,165,892)
$
(5,165,892)
OTHER COMPREHENSIVE LOSS
Foreign currency translation
adjustment
512,140
-
512,140
1,290,855
-
1,290,855
Total comprehensive loss
(15,909,667)
(225,339,598)
(3,906,076)
(3,906,076)
Less: total comprehensive loss
attributable to non-controlling interests
-
-
-
(39,210)
-
(39,210)
Total comprehensive loss attributable
to the Company’s shareholders
(15,909,667)
(225,339,598)
(3,866,866)
(3,866,866)
As set forth above, the material differences between the U.S.
GAAP and IFRS presentation with respect to our consolidated balance
sheet as of December 31, 2021 and combined balance sheet as of
December 31, 2020 are as follows:
- The reclassification of “Accumulated other comprehensive loss”
under U.S. GAAP to “Reserves” under IFRS;
- The reclassification of amounts of IFRS share-based payments
from “Additional paid-in capital” under U.S. GAAP to “Reserves”
under IFRS; and
- Additional equity recognized from the difference between the
total deemed transaction price and net assets acquired related to
the Combination under IFRS.
As set forth above, the material difference between the U.S.
GAAP and IFRS presentation as it relates to our combined statement
of operations and comprehensive loss for the years ended December
31, 2021 and 2020 is as follows:
In 2021, the Company was deemed to have incurred non-cash
listing costs of approximately $209.4 million as a result of the
IFRS accounting treatment of the Combination, as the Cenntro Group
was deemed to have received a 67% controlling interest in the
Company and the Company was deemed to have incurred listing costs
equaling the difference between the total deemed transaction price
and total net assets. Under U.S. GAAP, the Combination is accounted
for as a reverse recapitalization, which is equivalent to the
issuance of shares by the Cenntro Group for the net assets of
Cenntro Electric Group Limited (formerly NBG), accompanied by a
recapitalization.
1
Represents a non-GAAP financial measure.
For additional information about non-GAAP measures, including,
where applicable, reconciliations to the most directly comparable
financial measures presented in accordance with U.S. GAAP, please
see “Non-GAAP Measures” below.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20220425005941/en/
Investor Relations Contact: Chris Tyson MZ North America
CENN@mzgroup.us 949-491-8235
Company Contact: PR@cenntroauto.com
IR@cenntroauto.com
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