Kandi Technologies, Corp. Says 2008 Second Quarter Revenues Grew 11.8% and 32% Through the First Half Propelled by Continuing Strength in ATV and Go-kart Sales
SOURCE:
Kandi Technologies, Corp.
2008-08-14 07:11:00
Kandi Technologies, Corp. Says 2008 Second Quarter Revenues Grew 11.8% and 32% Through the First Half Propelled by Continuing Strength in ATV and Go-kart Sales
Net Income in the ’08 Second Quarter Increased Approximately 28% and Approximately 23.5% in the First Half Compared With the Same Periods Last Year; Reiterating Its Growth Forecast, the Company Sees Recent Launch of COCO Super Mini Car Contributing to Significant Second Half and Full Year Gains; Investor Conference Call Scheduled for Tuesday, August 19, @ 4:30 pm ET
JINHUA, ZHEJIANG PROVINCE, CHINA–(EMWNews – August 14, 2008) – Kandi Technologies, Corp.
(
exporters of all terrain vehicles (ATVs), utility vehicles (UTVs) and its
number one exporter of go-karts, announced today that continuing strength
in its ATV and go-kart sales in the U.S. led to an 11.8% increase in second
quarter revenues to $12,424,373, compared with $11,109,555 in the same
period last year. The Company noted that, as reported last year, 2007
second quarter sales were inflated approximately 20% by its decision to
rush the delivery of orders ahead of an anticipated tax increase in the
third quarter and, consequently, the gain in this year’s quarter versus
normalized results was actually closer to 30%. Through the first six
months of the year, compared with last year’s first half, revenues grew
approximately 32% to a record $21,753,075.
The Company also reported that through the first six months of 2008, net
income grew 23.5% to $3,510,413 compared with the same period in 2007.
Including income of $334,010 from a discontinued operation, as well as an
approximately $34,000 tax benefit, net income in the 2008 second quarter
reached $2,435,451, a gain of 27.8% compared with $1,707,052 in the 2007
second quarter.
The Company said that the gain in net income also reflects a 24.4% increase
in gross profits in the quarter, stemming not only from increased revenues,
but also from the decrease achieved by the Company in its cost of sales
from approximately 76% of revenues in the 2007 second quarter to 74% in the
most recent period. The Company attributed this to discounts obtained on
raw materials due to higher sales volume as well as its continued focus on
cost controls.
At the same time, the Company said it increased spending in the quarter in
line with its continuing rapid growth and the launch of its new super mini
car product category, which the Company expects will rapidly become the
most significant contributor to future revenue and profit growth. In
particular, the Company continued to grow its sales and administrative
personnel which increased spending in these areas. It also significantly
increased expenditures on research and development, with a focus on
development of its new TT, a three-wheeled motorcycle which, as previously
announced, it expects to launch in the third quarter this year. The
Company also has developed two new models of its popular UTVs for
agricultural use and expects each of these products will make important
contributions to second half results.
On June 30th, 2008, the Company closed on its previously reported
approximately $12.3 million purchase of a new manufacturing facility
adjacent to its existing facility. All of the Company’s ATRV manufacturing
has been moved to the new facility, and the Company’s existing facility is
now geared up for mass production of its new super minis.
EPS
Earnings per share for the second quarter ended June 30, 2008 were $0.12,
compared with $0.16 in the year earlier period. For the first half of
2008, EPS was $0.18, compared with $0.24 in the first six months of 2007.
The Company noted that EPS calculations for the quarter and the half in
2008 are based on 19,961,000 shares outstanding, while EPS figures in 2007
are based on 12,176,911 shares outstanding for the quarter and 12,088,456
shares in the year ago first half. The reason for the difference in shares
outstanding is that under the required weighted average share formula the
Company has utilized since the completion of its reverse merger in June,
2007, its outstanding shares of 19,961,000 have been weighted accordingly
throughout 2007, but in 2008, are outstanding for the entire period.
COCO Launch
Earlier this week, the Company announced that the first shipments of its
sporty new, fuel efficient (up to 60 mpg) COCO convertible have begun to
arrive in the U.S., marking the start of a new era for the Company, in
which it expects sales of its super mini cars will quickly become the key
contributor to continuing growth. In the release the Company also reported
that its U.S. distributor of the new super minis, Solus International Corp,
based in Lynwood, Washington, has received a highly positive initial
response from its sales outlets throughout North America, reinforcing the
Company’s belief that it will deliver to this market at least 5000 of its
new, off highway vehicles before year end.
Outlook
Commenting on first half results and the outlook for the full year, Mr.
Xiaoming Hu, CEO and Chairman of the Board of the Company, stated, “With
the recent first shipments to the U.S. of our exciting, new COCO
convertible, we have turned a new page in Kandi’s development. In
relatively short order we expect that the manufacturing and sales of super
mini autos will become our largest business bringing a new growth dimension
to the Company.”
He added, “We continue to believe that barring any delays in production or
shipping, strong consumer interest in our off highway super minis will
translate to sales of the new COCO convertible in a range of 5,000 to
10,000 vehicles before year end. And, at a sales price to Kandi of
approximately $4,000 per vehicle upon delivery, this should translate to a
contribution of at least $20 million in new revenues to second half and
full year results.”
“Additionally,” Mr. Hu stated, “given anticipated margins on these sales of
up to 30%, we expect that overall gross margins in 2008 will exceed the
margins achieved last year of 21.5%.”
“At the same time,” Mr. Hu said, “we expect continuing growth in our ATRV
sales in a range of 10% to 20%, with a continued concentration on building
fewer overall units of more high end vehicles which offer higher margins.
In this regard, we expect to see a boost in sales from our two new UTV
models for agricultural use.”
He concluded, “We have not yet factored into our guidance an anticipated
contribution from our newest product line, the TT three-wheeled motorcycle,
which offers higher levels of safety and superb mileage. With its expected
launch in the current quarter, it has already generated considerable
excitement from our distributors, who have seen a dramatic climb in
motorcycle imports over the past year.”
“Beyond the current year,” Mr. Hu stated, “we fully expect dramatic
increases in the sales of our super minis to U.S. consumers hungry for more
exciting, fuel efficient cars, especially as we add electric powered and
gas powered hard tops to the line in the not too distant future.”
Conference Call Invitation
The Company will host a conference call to discuss its second quarter
results for the period ended June 30, 2008 and its full year ’09 outlook
on Tuesday, August 19, 2008 at 4:30 p.m. ET.
Interested participants should call 1-800-762-8795 when calling within the
United States or 1-480-629-9031 when calling internationally. Please ask
for the Kandi Technologies, Corp. Earnings Conference Call, Pass Code
3912198. There will be a playback available until 08/26/2008 . To listen
to the playback, please call 1-800-406-7325 when calling within the
United States or 1-303-590-3030 when calling internationally. Use the
Pass Code 3912198 for the replay.
This call is being webcast by ViaVid Broadcasting and can be accessed by
clicking on this link http://viavid.net/dce.aspx?sid=0000554D or at
ViaVid’s website at www.viavid.net. The webcast can be accessed through
August 19, 2009.
KANDI TECHNOLOGIES, CORP.
(FORMERLY STONE MOUNTAIN RESOURCES, INC.) AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
June 30,
2008 December 31,
(Unaudited) 2007
------------ ------------
CURRENT ASSETS
Cash and cash equivalents $ 156,896 $ 1,149,140
Restricted cash 6,548,503 1,367,222
Accounts receivable, net of allowance for
doubtful accounts of $1,634 and $3,701 as of
June 30, 2008 and December 31, 2007,
respectively 14,501,396 11,401,367
Inventories 5,425,919 3,293,529
Notes receivable, net of discount of $68,285 and
$0 as of June 30, 2008 and December 31, 2007,
respectively 6,506,108 47,853
Other receivables 131,281 416,454
Deposit for acquisition - 12,270,859
Prepayments and prepaid expenses 68,919 17,774
Due from employees - 9,932
Discontinued operation - 14,158,890
------------ ------------
Total Current Assets 33,339,022 44,133,020
------------ ------------
LONG-TERM ASSETS
Plant and equipment, net 16,245,693 10,427,176
Land use rights, net 9,477,194 385,539
Construction in progress 1,253,868 1,321,832
Discontinued operation - 506,526
Deferred taxes 480,986 405,006
------------ ------------
Total Long-Term Assets 27,457,741 13,046,079
------------ ------------
TOTAL ASSETS $ 60,796,763 $ 57,179,099
============ ============
KANDI TECHNOLOGIES, CORP.
(FORMERLY STONE MOUNTAIN RESOURCES, INC.) AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND SHAREHOLDERS' EQUITY
June 30,
2008 December 31,
(Unaudited) 2007
------------ ------------
CURRENT LIABILITIES
Accounts payable $ 11,397,872 $ 6,333,057
Other payables and accrued expenses 603,159 378,675
Short-term bank loans 27,139,905 20,869,862
Customer deposits 789,933 483,320
Notes payable 3,463,430 1,476,600
Due to employees 37,086 310
Due to related party 164,250 -
Discontinued operation - 14,296,572
------------ ------------
Total Current Liabilities 43,595,635 43,838,396
------------ ------------
LONG-TERM LIABILITIES
Discontinued operation - 2,651
Deferred taxes 296,511 296,511
------------ ------------
Total Long-Term Liabilities 296,511 299,162
------------ ------------
TOTAL LIABILITIES 43,892,146 44,137,558
------------ ------------
CONTINGENCIES
SHAREHOLDERS EQUITY
Common stock, $0.001 par value; 100,000,000
shares authorized; 19,961,000 and 19,961,000
shares issued and outstanding at June 30, 2008
and December 31, 2007, respectively 19,961 19,961
Additional paid-in capital 7,138,105 7,138,105
Retained earnings (the restricted portion is
$534,040 and $0 at June 30, 2008 and December
31, 2007, respectively) 8,635,534 5,125,120
Accumulated other comprehensive income 1,111,017 758,355
------------ ------------
TOTAL SHAREHOLDERS EQUITY 16,904,617 13,041,541
------------ ------------
TOTAL LIABILITIES AND SHAREHOLDERS EQUITY $ 60,796,763 $ 57,179,099
============ ============
Kandi Technologies, Corp.
Results of Operations
Comparison of Three Months Ended June 30, 2008 and June 30, 2007.
The following table sets forth the amounts and percentage relationship to
revenue of certain items in our consolidated statements of income and
comprehensive income for the three months ended June 30, 2008 and 2007:
Three Month Comparison
For the For the
three months three months
ended ended
June 30, June 30,
2008 2007
% of % of Growth in Increase
Amount Revenue Amount Revenue Amount in %
----------- ------ ----------- ------ ---------- ------
REVENUES $12,424,373 100.0% $11,109,555 100.0% $1,314,818 11.8%
COST OF GOODS
SOLD 9,139,131 73.6% 8,468,179 76.2% 670,952 7.9%
GROSS PROFIT 3,285,242 26.4% 2,641,376 23.8% 643,866 24.4%
Selling and
Marketing 180,596 1.5% 107,756 0.4% 72,840 67.6%
General and
Administrative 432,238 3.5% 142,060 1.0% 295,178 204.3%
Research and
Development 224,146 1.8% 40,749 1.3% 183,397 450.1%
INCOME FROM
CONTINUING
OPERATIONS 2,448,262 19.7% 2,350,811 21.2% 92,451 4.1%
Government
Grants 17,274 0.1% -- 0.0% 17,274 100%
Interest
Expense, Net (395,087) -3.2% (160,938) -1.4% (234,149) 145.5%
Other Income
(Expense), Net (1,948) 0.0% (70,254) -0.6% 68,305 -97.2%
INCOME FROM
CONTINUING
OPERATIONS
BEFORE
INCOME TAXES 2,068,501 16.6% 2,119,619 19.1% (56,119) -2.4%
INCOME TAX
BENEFIT 33,920 0.3% -- 0.0% 33,920 100%
NET INCOME FROM
CONTINUING
OPERATIONS 2,102,421 16.9% 2,119,619 19.1% (22,199) -0.1%
INCOME FROM
DISCONTINUED
OPERATIONS 334,030 2.7% (212,568) -1.9% 546,598 357.1%
NET INCOME $ 2,436,451 19.6% $ 1,907,052 17.2% $ 524,399 27.8%
Six Month Comparison
For the For the
six months six months
ended ended
June 30, June 30,
2008 2007
% of % of Growth in Increase
Amount Revenue Amount Revenue Amount in %
----------- ------ ----------- ------ ----------- ------
REVENUES $21,753,075 100.0% $16,471,019 100.0% $12,127,355 32.1%
COST OF GOODS
SOLD 16,316,178 75.0% 12,861,099 75.0% 10,300,378 26.9%
GROSS PROFIT 5,436,897 25.0% 3,609,920 37.5% 1,826,977 50.6%
Selling and
Marketing 409,102 1.9% 188,354 2.0% 220,748 117.2%
General and
Administrative 704,682 3.2% 285,346 3.0% 399,336 147.0%
Research and
Development 264,816 1.2% 52,615 0.5% 212,201 403.3%
INCOME FROM
CONTINUING
OPERATIONS 4,058,297 18.7% 3,083,605 32.0% 994,692 31.6%
Government
Grants 40,574 0.2% -- 0.0% 40,573 100%
Interest
Expense, Net (1,009,699) -4.6% (295,748) -3.1% (713,951) 241.4%
Forfeiture of
customer
deposits -- 0.0% 267,673 2.8% (267,672)-100.0%
Other Income
(Expense),
Net 20,047 0.1% (69,694) -0.7% 89,741 -128.8%
INCOME FROM
CONTINUING
OPERATIONS
BEFORE
INCOME TAX 3,109,219 14.3% 2,985,836 31.0% 143,383 4.1%
INCOME TAX 73,660 0.3% -- 0.0% 73,659 100%
NET INCOME FROM
CONTINUING
OPERATIONS 3,182,879 14.7% 2,985,836 31.0% 217,043 6.60%
GAIN (LOSS) FROM
DISCONTINUED
OPERATIONS 327,534 1.5% (140,200) -1.5% 467,734 333.6%
NET INCOME $ 3,510,413 16.1% $ 2,845,636 29.6% $ 684,777 23.5%
About the Company
In its core All Terrain Recreational Vehicle (ATRV) businesses, Kandi
Technologies, Corp. (
sales in 2007, coupled with a 370% increase in profits to just over $5
million, the Company ranks as the number one manufacturer and exporter of
go-karts in China, making it a world leader in the production of this
increasingly popular recreational vehicle. It also ranks among the leading
manufacturers in China of all terrain vehicles (ATVs) producing more than
30,000 ATV units last year. A more recent Company focus in the ATRV
category has been on specialized utility vehicles (UTVs), especially for
agricultural purposes, a vehicle line that is seeing strong growth,
especially in the North America, where Kandi sells approximately 70% of its
products, all of which are exported. In the third quarter, the Company
expects to launch its innovative three-wheeler motorcycle, the TT. The
most exciting new development at the Company is the launch it has begun in
the U.S. of its highly economical, beautifully designed off highway, super
mini car for casual, neighborhood driving. Further, within the next two
years it expects to follow its two seater, high mileage super mini
convertible, with additional lines of electric and gas powered hard tops
for highway driving. Kandi believes that super minis will very rapidly
become the Company’s largest revenue and profit generators.
The Company’s products can be viewed at http://www.chinakandi.com
Information Regarding Forward-Looking Statements
Except for historical information contained herein, the statements in this
Press Release are forward-looking statements that are made pursuant to the
safe harbor provisions of the Private Securities Litigation Reform Act of
1995. Forward-looking statements involve known and unknown risks and
uncertainties, which may cause our actual results in future periods to
differ materially from forecasted results. These risks and uncertainties
include, among other things, product demand, market competition, and risks
inherent in our operations. These and other risks are described in our
filings with the Securities and Exchange Commission.
| Contacts:
Kandi Technologies Corp. US Investors Focus Asia Partners Press Ken Donenfeld |
|
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