- Q3 revenue increased 345.4% yoy to $28.4 million –
- Q3 JV Company sold 6,765 units of EV products, a 3576.6% increase yoy –
- Q3 GAAP net income of $1.9 million compared to net loss of $0.6 million in the same period last year –
JINHUA, CHINA-- (November 9, 2017) - Kandi Technologies Group, Inc. (the “Company,” “we” or “Kandi”) (NASDAQ GS: KNDI), today announced its financial results for the third quarter of 2017.
Third Quarter Highlights
• Total revenues were $28.4 million for the third quarter of 2017, an increase of 345.4% from total revenues of $6.4 million for the same period in 2016.
• Electric Vehicle (“EV”) parts sales increased by 473.2%, to $27.0 million for the third quarter of 2017, compared with EV parts sales of $4.7 million for the same period in 2016.
• Kandi Electric Vehicles Group Co., Ltd. (the "JV Company") sold 6,765 units of EV products, including 2,747 units of model K17 and 4,018 of model K12 for the third quarter of 2017 compared to 184 units sold in the same period last year;
• GAAP net income for the third quarter of 2017 was $1.9 million, or earnings of $0.04 per fully diluted share compared with GAAP net loss of $0.6 million, or loss of $0.01 per fully diluted share for the same period in 2016
• Non-GAAP adjusted net income , which excludes stock award expenses and the change of the fair value of financial derivatives, was $3.0 million in the third quarter of 2017, compared with non-GAAP net loss of $1.8 million for the same period in 2016. Non-GAAP adjusted income per share1 was approximately $0.06 per fully diluted share for the third quarter of 2017, compared with Non-GAAP adjusted loss per share1 of $0.04 per fully diluted share for the same period in 2016.
• Working capital surplus was $45.3 million as of September 30, 2017. Cash, cash equivalents and restricted cash totaled $24.3 million as of September 30, 2017.
[1]Non-GAAP measures, including Non-GAAP net income and Non-GAAP EPS are defined as the financial measures excluding the change of fair value of financial derivatives and the effects of stock award expenses. We supply non- GAAP information because we believe it allows our investors to obtain a clearer understanding of our operations. Any non-GAAP measure 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.
Mr. Hu Xiaoming, Chairman and Chief Executive Officer of Kandi, commented, “We're pleased with our solid business performance in the third quarter. Our production and sales have increased significantly year over year as the JV Company has resumed normal production and sales of EV products. Due to confusion surrounding the reusable battery exchange model, our business had been heavily impacted since last year. We have been working diligently since then to overcome that difficult time in order to turn it into a great success. This quarter represents a turning point and an exciting time for Kandi as the Company continues preparing for the tremendous opportunities available in the renewable energy industry. We remain confident in our ability to continue to successfully execute our long-term business plan and regain our leading market position in the EV industry in the near future.”
Net Revenues and Gross Profit
Net revenues for the third quarter of 2017 increased by 345.4% compared to the same period last year. The increase in net revenue was mainly due to the increase in EV parts sales during this quarter. The selling price of our products for the three months ended September 30, 2017 decreased on average from the same period last year. The increase in revenues was primarily due to the increase in sales volume.
Operating Income (Loss)
Total operating expenses in the third quarter of 2017 were $3.1 million, compared with $1.3 million in the same quarter of 2016. The increase in total operating expenses was due to increased G&A expenses, which were $2.2 million in this quarter compared with $0.4 million in the same quarter last year.
GAAP Net Income (Loss)
Net income was $1.9 million in the third quarter, compared with net loss of $0.6 million in the same quarter of 2016. The net income for this quarter was primarily attributable to significantly increased revenue and gross profits this period as compared to the same period of last year.
Non-GAAP net income was $2.9 million in the third quarter of 2017, an increase of $4.7 million compared to Non-GAAP net loss of $1.8 million in the same quarter of 2016. The increase in net income (non-GAAP) was primarily attributable to the significantly increased revenue and gross profits in the third quarter of 2017.
Kandi Electric Vehicles Group Co., Ltd. (the “JV Company”) Financial Results
In the third quarter of 2017, the JV Company sold 6,765 units of EV products.
The condensed financial income statements of the JV Company in the third quarter are as set forth below:
Revenue for the JV Company was $86.2 million in the third quarter of 2017, an increase of 637.3% compared to the same quarter of 2016. Net loss was $0.5 million, a 12.6% decrease compared to the same quarter of 2016.
Kandi’s investments in the JV Company are accounted for using the equity method of accounting because Kandi has a 50% ownership interest in the JV Company. As a result, Kandi recorded 50% of the JV Company’s losses of $0.2 million for this quarter. After eliminating intra-entity profits and losses, Kandi’s share of the after-tax profit of the JV Company was $0.4 million for the third quarter of 2017.
Third Quarter 2017 Conference Call Details
The Company has scheduled a conference call and live webcast to discuss its second quarter 2017 financial results at 8:00 A.M. Eastern Time (9:00 P.M. Beijing Time) on November 9, 2017. Mr. Hu Xiaoming, Chief Executive Officer of the Company, and Mr. Mei Bing, Chief Financial Officer of the Company, will deliver prepared remarks to be followed by a question and answer session.
Dial-in details for the conference call are as follows:
• Toll-free dial-in number: +1-855-327-6838
• International dial-in number: + 1-604-235-2082
• Webcast and replay: http://public.viavid.com/index.php?id=127124
A live audio webcast of the call can also be accessed by visiting Kandi's Investor Relations page on the Company’s website athttp://www.kandivehicle.com. An archive of the webcast will be available on the Company’s website following the live call.
