Greenland Technologies Holding Corporation (NASDAQ: GTEC) ("Greenland" or the "Company"), a technology developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machineries and vehicles, today announced its unaudited financial results for the fourth quarter and full year ended December 31, 2021.
Full Year 2021 Financial and Operating Highlights
Mr. Raymond Wang, Chief Executive Officer of Greenland Technologies Holding Corporation, commented, "This was a record year for Greenland as our team drove 48% growth in full year 2021 revenue compared to last year, while expanding our gross margin another 70 basis points to 19.8%. We introduced a series of popular new electric industrial vehicle models, expanded our new vehicle pipeline to reach additional categories in the industrial market and made major progress on our manufacturing strategy."
Mr. Wang added, "Our long-term vision remains for Greenland to be the global standard for electric industrial vehicles, which we believe deliver superior performance and a faster return on investment than traditional industrial vehicles. To that end, we recently announced a new distribution agreement with a minimum potential market value of $5 million to $8.4 million; and we announced new strategic partnerships for lithium battery solutions and autonomous vehicle technology. As a result, while we are pleased with our continued success and progress, we are even more excited about the Company's future, as we leverage our advantaged market position to capture an increased share of the growth opportunities in front of us."
Mr. Jing Jin, Chief Financial Officer of Greenland, commented: "We continued to drive record revenue growth and gross margin expansion led by higher transmission sales, while increasing investments in our infrastructure to support the next phase of our growth. Costs have increased in nearly all areas from materials to shipping, which we were able to partially mitigate through prior agreements we had in place but this remains a near-term headwind. Importantly, we continued to add to our revenue generating headcount, with sales and marketing hires, while also more than doubling our investment in R&D in support of our expanded product roadmap. Despite the significant increase in investment, operating expense as a percentage of total revenues increased only 2.3 percentage points from the prior year to 11.5% for the full year 2021. Finally, we took the opportunity in 2021 to fortify our balance sheet, giving us added flexibility as we move forward with the next phase of Greenland's growth."
Recent Developments and Strategic Highlights:
Full Year 2021 Financial Results
Total revenues were $98.8 million, an increase of 48% from $66.9 million in 2020. The increase was primarily due to the significant increase in our sales volume that resulted from increased customer demand and Greenland's effective supply chain management, which allowed it to partially mitigate the impact from logistics constraints and materials shortages. The number of transmission products sold increased 30% to 141,431 units from 108,913 units in 2020.
Costs of goods sold were $79.2 million, an increase of 47% from $54.1 million in 2020. The increase was primarily due to the increase in sales volume and the increase in raw material prices.
Gross profit was $19.6 million, an increase of 53% from $12.8 million in 2020. Gross margin was 19.8%, up 70 basis points from 2020. The increase was primarily due to the ongoing strategic product mix shift towards higher value, more sophisticated products, such as hydraulic transmission products.
Total operating expenses were $11.3 million, up 86% from $6.1 million in 2020. Operating expense as a percentage of total revenues was 11.5%, an increase of 2.3 percentage points from 2020. The increase in operating expenses was primarily due to the Company's investments in support of its higher revenue level and targeted growth, with an expansion of its revenue generating headcount and a more than doubling of its R&D for the full year 2021 compared to the full year 2020.
Income from operations was $8.3 million, an increase of 23% from $6.7 million in 2020.
Net Income was $7.3 million, an increase of 14% from $6.4 million in 2020.
Basic and diluted net income per ordinary share was $0.58, compared with $0.67 in 2020.
Fourth Quarter 2021 Financial Results
Total revenues were $22.9 million, compared with $23.9 million in the fourth quarter of 2020. The slight decline was due to the recognition of orders that accumulated during the pandemic but were not fulfilled until the fourth quarter of 2020, combined with the adverse impact in the fourth quarter of 2021 of ongoing supply chain constraints that limited availability of necessary materials and components. The number of transmission products sold was 31,349 units, compared with 37,164 units in the fourth quarter of 2020.
Costs of goods sold were $19.3 million, almost unchanged from the fourth quarter of 2020.
Gross profit was $3.7 million, compared with $4.6 million in the fourth quarter of 2020. Gross margin was 16.1%, compared with 19.3% in the fourth quarter of 2020, as a result of the lower revenue and higher raw material prices.
Total operating expenses were $3.8 million, up 103% from $1.9 million in the fourth quarter of 2020. Operating expense as a percentage of total revenues was 16.5%, compared to 7.8% in the fourth quarter of 2020. The increase in operating expenses was primarily due to the Company's investments in support of its growth strategy, with an expansion of its revenue generating headcount and 180% increase in its R&D on a year over year basis.
Loss from operations was $0.1 million, compared with income from operations of $2.7 million in the fourth quarter of 2020.
Net Income was $0.4 million, compared with $2.2 million in the fourth quarter of 2020.
Basic and diluted net income per ordinary share was $0.03, compared with $0.31 in the fourth quarter of 2020.
Business Outlook
For the full year of 2022, the Company expects to deliver between 100 to 150 vehicles.
The above outlook is based on information available as of the date of this press release and reflects the Company's current and preliminary expectations regarding its business situation and market conditions. The outlook is subject to change, especially considering the uncertainties which may result from how the COVID-19 pandemic develops globally.
Conference Call
The Greenland Technologies Holding Corporation management team will host an earnings conference call at 8:00 AM on Monday, March 28, 2022, U.S. Eastern Time (8:00 PM on March 28, 2022, Beijing/Hong Kong Time).
Please register in advance for the conference using the link below and dial in 10 minutes before the conference is scheduled to begin. Conference access information will be provided upon registration.
Online Participant Registration: http://apac.directeventreg.com/registration/event/2738409
A replay of the conference call may be accessed by phone at the following numbers until April 5, 2022. To access the replay, please reference the conference ID 2738409.
Phone Number | |
International | +61 2 9003-4211 |
United States | +1 (855) 452-5696 |
China Hong Kong | +852 800963117 |
Mainland China | +86 4008209035 +86 8009880552 |
A live and archived webcast of the conference call will be available at https://ir.gtec-tech.com/.
About Greenland Technologies Holding Corporation
Greenland Technologies Holding Corporation (NASDAQ: GTEC) is a developer and a manufacturer of drivetrain systems for material handling machineries and electric vehicles, as well as electric industrial vehicles. For more information visit https://ir.gtec-tech.com/.
Safe Harbor Statement
This press release contains statements that may constitute "forward-looking statements." Such statements reflect Greenland's current views with respect to future events and are subject to such risks and uncertainties, many of which are beyond the control of Greenland, including those set forth in the Risk Factors section of Greenland's Annual Report on Form 10-K and Definitive Proxy Statement on Schedule 14A filed with the Securities and Exchange Commission ("SEC"). Copies are available on the SEC's website, www.sec.gov. Words such as "expect," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "will," "could," "should," "believes," "predicts," "potential," "continue," and similar expressions are intended to identify such forward-looking statements. These forward-looking statements include, without limitation, Greenland's expectations with respect to future performance. In addition, there is uncertainty about the further spread of the COVID-19 virus or the occurrence of another wave of cases and the impact it may have on the Company's operations, the demand for the Company's products, global supply chains and economic activity in general. Should one or more of these risks or uncertainties materialize, or should assumptions underlying the forward-looking statements prove incorrect, actual results may vary materially from those described herein as intended, planned, anticipated or expected. Statements contained in this news release regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Greenland does not intend and does not assume any obligation to update these forward-looking statements, other than as required by law.
Statement Regarding Preliminary Unaudited Financial Information
The unaudited financial information set out in this earnings release is preliminary and subject to potential adjustments. Adjustments to the consolidated financial statements may be identified when audit work has been performed for the Company's year-end audit, which could result in significant differences from this preliminary unaudited financial information.
For more information, please contact:
In China:
The Blueshirt Group
Ms. Feifei Shen
Phone: +86 134-6656-6136
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Ms. Miranda Tian
Phone: +86 135-2551-1189
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In the United States:
The Blueshirt Group
Ms. Julia Qian
Phone: +1 973-619-3227
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Global IR Partners
Mr. David Pasquale
Phone: +1 914-337-8801
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GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES | ||||||||
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME | ||||||||
FOR THE YEARS ENDED DECEMBER 31, 2021 AND 2020 | ||||||||
(IN U.S. DOLLARS) | ||||||||
For the years ended December 31, | ||||||||
2021 | 2020 | |||||||
REVENUES | $ | 98,839,900 | $ | 66,864,375 | ||||
COST OF GOODS SOLD | 79,246,280 | 54,051,367 | ||||||
GROSS PROFIT | 19,593,620 | 12,813,008 | ||||||
Selling expenses | 1,868,156 | 1,588,302 | ||||||
General and administrative expenses | 3,948,850 | 2,131,405 | ||||||
Research and development expenses | 5,526,546 | 2,384,951 | ||||||
Total operating expenses | $ | 11,343,552 | $ | 6,104,658 | ||||
INCOME FROM OPERATIONS | $ | 8,250,068 | $ | 6,708,350 | ||||
Interest income | 68,295 | 2,645 | ||||||
Interest expense | (587,264) | (930,634) | ||||||
Loss on disposal of property and equipment | 1,785 | (79,216) | ||||||
Other income/(loss) | 1,378,597 | 1,002,642 | ||||||
Remeasurement gain from change in functional currency | - | 1,940,773 | ||||||
INCOME BEFORE INCOME TAX | $ | 9,111,481 | $ | 8,644,560 | ||||
INCOME TAX | 1,843,260 | 2,272,997 | ||||||
NET INCOME | $ | 7,268,221 | $ | 6,371,563 | ||||
LESS: NET INCOME (LOSS) ATTRIBUTABLE TO NONCONTROLLING INTEREST | 1,002,643 | (386,939) | ||||||
NET INCOME ATTRIBUTABLE TO GREENLAND TECHNOLOGIES HOLDING | $ | 6,265,578 | $ | 6,758,502 | ||||
OTHER COMPREHENSIVE INCOME (LOSS): | 1,476,710 | 937,629 | ||||||
Unrealized foreign currency translation income (loss) attribute to Greenland | 1,077,324 | 298,056 | ||||||
Unrealized foreign currency translation income (loss) attribute to Noncontrolling | 399,386 | 639,573 | ||||||
Comprehensive income | 7,342,902 | 7,056,558 | ||||||
Noncontrolling interest | 1,402,029 | 252,634 | ||||||
WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING: | ||||||||
Basic and diluted | 10,840,638 | 10,037,249 | ||||||
NET INCOME PER ORDINARY SHARE ATTRIBUTABLE TO OWNERS OF THE COMPANY: | ||||||||
Basic and diluted | 0.58 | 0.67 | ||||||
See accompanying notes to the consolidated financial statements. | ||||||||
GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
AS OF DECEMBER 31, 2021 AND 2020 | ||||||||||
(IN U.S. DOLLARS) | ||||||||||
December 31, | December 31, | |||||||||
2021 | 2020 | |||||||||
ASSETS | ||||||||||
Current assets | ||||||||||
Cash and cash equivalents | $ | 11,062,590 | $ | 7,159,015 | ||||||
Restricted cash | 6,738,302 | 2,244,038 | ||||||||
Short Term Investment | 2,105,938 | - | ||||||||
Notes receivable | 37,551,121 | 30,803,772 | ||||||||
Accounts receivable, net of allowance for doubtful accounts of $859,319 and | 15,915,002 | 12,408,548 | ||||||||
Inventories | 25,803,474 | 15,380,063 | ||||||||
Due from related parties-current | 39,679,565 | 38,535,171 | ||||||||
Advance to suppliers | 434,893 | 447,901 | ||||||||
Prepayments and other current assets | 14,518 | 664,926 | ||||||||
Total Current Assets | $ | 139,305,403 | $ | 107,643,434 | ||||||
Non-current asset | ||||||||||
Property, plant, equipment and construction in progress, net | 18,957,553 | 20,135,339 | ||||||||
Land use rights, net | 4,035,198 | 4,035,254 | ||||||||
Deferred tax assets | 141,623 | 158,455 | ||||||||
Goodwill | 3,890 | 3,890 | ||||||||
Operating lease right-of-use assets | 80,682 | - | ||||||||
Other non-current assets | 44,093 | 2,365 | ||||||||
Total non-current assets | $ | 23,263,039 | $ | 24,335,303 | ||||||
TOTAL ASSETS | $ | 162,568,442 | $ | 131,978,737 | ||||||
GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES | ||||||||||
CONSOLIDATED BALANCE SHEETS | ||||||||||
AS OF DECEMBER 31, 2021 AND 2020 (Continued) | ||||||||||
(IN U.S. DOLLARS) | ||||||||||
December 31, | December 31, | |||||||||
2021 | 2020 | |||||||||
Current Liabilities | ||||||||||
Short-term bank loans | $ | 8,760,945 | $ | 18,487,356 | ||||||
Notes payable-bank acceptance notes | 42,093,061 | 25,889,067 | ||||||||
Accounts payable | 29,064,132 | 22,005,260 | ||||||||
Taxes payables | 108,058 | - | ||||||||
Customer deposits | 387,919 | 366,029 | ||||||||
Due to related parties | 3,619,459 | 9,051,119 | ||||||||
Other current liabilities | 1,198,427 | 2,212,325 | ||||||||
Current portion of operating lease liabilities | 33,308 | - | ||||||||
Lease obligations - current | 197,915 | 797,179 | ||||||||
Total current liabilities | $ | 85,463,224 | $ | 78,808,335 | ||||||
Long-term liabilities | ||||||||||
Lease obligations – non-current | - | 166,292 | ||||||||
Long term operating lease liabilities | 47,614 | - | ||||||||
Other long-term liabilities | 2,212,938 | 2,342,648 | ||||||||
Total long-term liabilities | $ | 2,260,552 | $ | 2,508,940 | ||||||
TOTAL LIABILITIES | $ | 87,723,776 | $ | 81,317,275 | ||||||
COMMITMENTS AND CONTINGENCIES | ||||||||||
EQUITY | ||||||||||
Ordinary shares, no par value, 11,329,530 shares authorized; 11,329,530 and | - | - | ||||||||
Additional paid-in capital | 23,759,364 | 13,707,398 | ||||||||
Statutory reserves | 3,842,331 | 4,517,117 | ||||||||
Retained earnings | 33,668,696 | 26,728,332 | ||||||||
Accumulated other comprehensive income (loss) | 1,014,399 | (62,925) | ||||||||
Total shareholders' equity | $ | 62,284,790 | $ | 44,889,922 | ||||||
Non-controlling interest | 12,559,876 | 5,771,540 | ||||||||
TOTAL EQUITY | $ | 74,844,666 | $ | 50,661,462 | ||||||
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | $ | 162,568,442 | $ | 131,978,737 | ||||||
See accompanying notes to the consolidated financial statements. | ||||||||||
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| Daily Change: | 0.23 10.45 |
| Daily Volume: | 188,128 |
| Market Cap: | US$33.020M |
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