Kandi Technologies Reports 2021 Financial Results

Rhea-AI Summary

Kandi Technologies Group, Inc. (KNDI) reported a significant increase in revenue for 2021, reaching $91.5 million, up 18.9% from $76.9 million in 2020. The company achieved a net income of $22.9 million ($0.30 per share), compared to a loss of $10.4 million the previous year. High growth in the electric scooter segment surged by 420.6% to $30.0 million. Despite challenges in the pure electric vehicle market, Kandi plans to focus on the electrified off-road vehicle sector, aiming to lead this market in China within three years.

Positive

• Revenue increased by 18.9% to $91.5 million.
• Net income rose to $22.9 million from a loss of $10.4 million in 2020.
• Electric scooter sales grew by 420.6% to $30.0 million.
• Gross margin improved slightly to 17.8%.

Negative

• Sales of EV parts decreased to $25.3 million from $40.6 million in 2020.
• Operating expenses increased by 17.1% to $14.9 million.

• 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.

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 -

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

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	)

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

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

FAQ

What are Kandi's 2021 revenue figures?

Kandi reported a total revenue of $91.5 million for 2021, up 18.9% from $76.9 million in 2020.

How much net income did Kandi Technologies earn in 2021?

Kandi earned a net income of $22.9 million in 2021, compared to a net loss of $10.4 million in 2020.

How did Kandi's electric scooter sales perform in 2021?

Sales of electric scooters increased by 420.6% to $30.0 million in 2021.

What is Kandi's future strategy in the EV market?

Kandi plans to focus on the electrified off-road vehicle segment and aims to become a market leader in China within three years.

What was Kandi's gross margin for 2021?

Kandi's gross margin for 2021 was 17.8%, slightly up from 17.5% in 2020.