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Greenland Technologies Reports Record First Quarter 2022 Revenue

16 May 2022
  • 19% Increase in 1Q22 Revenue to Record $29.3 Million Compared to 1Q21
  • 19% Increase in 1Q22 Net Income to $2.9 Million Compared to 1Q21
  • Cash Balance Rises 30% to $13.2 Million

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 first quarter ended March 31, 2022.

First Quarter 2022 Financial and Operating Highlights

  • Total revenues were $29.3 million, an increase of 19% from $24.6 million in the same period of 2021.
  • Gross margin was 21.7%, an increase of 100 basis points year over year.
  • Net Income was $2.9 million, an increase of 19% from $2.4 million in the same period of 2021.
  • Number of transmission products sold was 41,902 units, an increase of 13% compared with 36,986 units in the same period of 2021.

Mr. Raymond Wang, Chief Executive Officer of Greenland Technologies Holding Corporation, commented, "We delivered our highest quarterly revenue to date, as we drove 19% year over year growth in first quarter revenue and a 19% year over year increase in net income. Our team continues to make impressive progress executing on our rapidly expanding industrial electric vehicle product line, while at the same time moving forward with our U.S. production expansion to ensure we have capacity to support the overwhelmingly positive customer response and expected long-term demand."

Mr. Wang added, "Our ongoing strategic shift toward higher-value, feature-rich products helped drive a 100 basis points improvement in gross margin to 21.7%. Additionally, our electric industrial vehicle division is on track with our upcoming assembly facility in Baltimore County, Maryland on schedule for a July opening. Though the industry is facing continued headwinds from the pandemic lockdown in China, we remain optimistic given the long-term transformation of the industrial vehicle industry, led by demand for cleaner, greener electric vehicles and support from local legislation.  With our proven track record and expanding product roadmap, we are positioned to address the growing demand for our industrial electric vehicles, as we focus on building increased value for shareholders."

Mr. Jing Jin, Chief Financial Officer of Greenland, commented: "Demand for Greenland's transmission products remained strong, as we leverage our global brand, inventory management and performance track record to partially offset headwinds from higher raw materials and component prices, COVID-19 shutdowns, global inflation, and higher logistics costs. In addition to our strong 19% year over year revenue and 19% year over year net income growth, we further strengthened our balance sheet with a 30% increase in our cash on hand. This gives us added confidence and flexibility, as we continue to prioritize investments in R&D innovation and revenue generation, which we believe will drive Greenland's long-term market share gains in the electric industrial vehicle market and significant value creation for shareholders."

Recent Developments and Strategic Highlights:

  • Secured Lease On Assembly Facility: Greenland has secured and fully executed a lease on its first assembly facility located in Baltimore County, Maryland. The site is over 54,000 sq ft and will produce over 500 electric heavy equipment units per year when fully operational. Maryland's Governor Larry Hogan noted, "As we continue to invest in new products and technologies, Greenland's vision and growth in electric industrial vehicles will fit in well with our state's innovative ecosystem."
  • Launched of New HEVI Brand: Greenland has launched a new HEVI brand to encapsule its electric heavy industrial equipment division. This brand replaces Greenland Machinery and better exemplifies the culture and objective of introducing clean and sustainable alternatives to the industrial equipment industry.
  • Passed Clean Cars Act of Maryland: Greenland supported the passing of HB1391 – Maryland Clean Cars Act of 2022 that will introduce consumer incentives for electric heavy industrial equipment purchases within the state effective July 1, 2022.

First Quarter 2022 Financial Results

Total revenues were $29.3 million, an increase of 19% from $24.6 million in the first quarter of 2021. The increase was primarily due to higher sales volume, driven by continued demand for the Company's products and its effective supply chain management. The number of transmission products sold was 41,902 units, up 13% from 36,986 units in the first quarter of 2021.

Costs of goods sold were $22.9 million, an increase of 18% from $19.5 million in the first quarter of 2021. The increase was primarily due to the increase in sales volume, higher cost of raw materials and components, higher shipping costs and higher logistics costs.

Gross profit was $6.4 million, an increase of 25% from $5.1 million in the first quarter of 2021. Gross margin was 21.7%, an increase of 100 basis points from 20.7% in the first quarter of 2021, as a result of the Company's strategic shift towards higher value, more sophisticated products, such as hydraulic transmissions.

Total operating expenses were $3.0 million, up 33% from $2.2 million in the first quarter of 2021. Operating expenses as a percentage of total revenues was 10.2%, compared to 9.1% in the first quarter of 2021. The increase in operating expenses was primarily due to the Company's investments in support of its growth strategy, with an expansion of revenue-generating and R&D efforts. 

Income from operations was $3.4 million, an increase of 18% from $2.9 million in the first quarter of 2021. 

Net Income was $2.9 million, an increase of 19% from $2.4 million in the first quarter of 2021.

Basic and diluted net income per ordinary share was $0.16, compared with $0.21 in the first quarter of 2021.

Conference Call

The Greenland Technologies Holding Corporation management team will host an earnings conference call at 8:00 AM on Monday, May 16, 2022, U.S. Eastern Time (8:00 PM on May 16, 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/2888891

A replay of the conference call may be accessed by phone at the following numbers until May 24, 2022. To access the replay, please reference the conference ID 2888891.

 

Phone Number

International

+61 2 8199-0299

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. Information on the Company's clean industrial heavy equipment division can be found at HEVI Equipment, its new clean industrial heavy equipment division. For additional 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
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Ms. Miranda Tian   
Phone: +86 135-2551-1189
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

In the United States:

The Blueshirt Group
Ms. Julia Qian
Phone: +1 973-619-3227
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

Global IR Partners
Mr. David Pasquale
Phone: +1 914-337-8801
Email: This email address is being protected from spambots. You need JavaScript enabled to view it.

GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE MONTHS ENDED MARCH 31, 2022 AND 2021

(UNAUDITED, IN U.S. DOLLARS)

 
  

For the

three months ended

March 31,

 
  

2022

  

2021

 

REVENUES

 

$

29,306,957

  

$

24,610,894

 

COST OF GOODS SOLD

  

22,938,983

   

19,506,507

 

GROSS PROFIT

  

6,367,974

   

5,104,387

 

Selling expenses

  

639,647

   

379,230

 

General and administrative expenses

  

1,279,746

   

911,139

 

Research and development expenses

  

1,082,594

   

959,545

 

Total operating expenses

 

$

3,001,987

  

$

2,249,914

 

INCOME FROM OPERATIONS

 

$

3,365,987

  

$

2,854,473

 

Interest income

  

12,562

   

4,595

 

Interest expense

  

(105,009)

   

(180,189)

 

Loss on disposal of property and equipment

  

(404)

   

(1,770)

 

Other income

  

261,032

   

288,746

 

INCOME BEFORE INCOME TAX

 

$

3,534,168

  

$

2,965,855

 

INCOME TAX

  

619,370

   

522,616

 

NET INCOME

 

$

2,914,798

  

$

2,443,239

 

LESS: NET INCOME ATTRIBUTABLE TO NONCONTROLLING INTEREST

  

1,127,746

   

314,671

 

NET INCOME ATTRIBUTABLE TO GREENLAND TECHNOLOGIES
   HOLDING CORPORATION AND SUBSIDIARIES

 

$

1,787,052

  

$

2,128,568

 

OTHER COMPREHENSIVE INCOME (LOSS):

  

373,910

   

(258,229)

 

Unrealized foreign currency translation income (loss) attributable to Greenland
   technologies holding corporation and subsidiaries

  

248,082

   

(189,103)

 

Unrealized foreign currency translation income (loss) attributable to Noncontrolling
   interest

  

125,828

   

(69,126)

 

Comprehensive income (loss)

  

2,035,134

   

1,939,465

 

Noncontrolling interest

  

1,253,574

   

245,545

 

WEIGHTED AVERAGE ORDINARY SHARES OUTSTANDING:

        

Basic and diluted

  

11,329,530

   

10,333,968

 

NET INCOME PER ORDINARY SHARE ATTRIBUTABLE TO OWNERS OF
   THE COMPANY:

        

Basic and diluted

  

0.16

   

0.21

 

GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2022 AND DECEMBER 31, 2021

(IN U.S. DOLLARS)

 
  
  

March 31,

  

December 31,

 
  

2022

  

2021

 
       

ASSETS

      

Current assets

      

Cash and cash equivalents

 

$

6,853,839

  

$

11,062,590

 

Restricted cash

  

6,330,613

   

6,738,302

 

Short Term Investment

  

4,066,630

   

2,105,938

 

Notes receivable

  

33,524,960

   

37,551,121

 

Accounts receivable, net of allowance for doubtful accounts of $869,034 and
   $859,319, respectively

  

24,715,861

   

15,915,002

 

Inventories

  

24,963,483

   

25,803,474

 

Due from related parties-current

  

39,790,638

   

39,679,565

 

Advance to suppliers

  

632,664

   

434,893

 

Prepayments and other current assets

  

80,782

   

14,518

 

Total Current Assets

 

$

140,959,470

  

$

139,305,403

 
         

Non-current asset

        

Property, plant, equipment and construction in progress, net

  

18,553,625

   

18,957,553

 

Land use rights, net

  

4,032,128

   

4,035,198

 

Deferred tax assets

  

676,622

   

141,623

 

Goodwill

  

3,890

   

3,890

 

Operating lease right-of-use assets

  

72,480

   

80,682

 

Other non-current assets

  

42,892

   

44,093

 

Total non-current assets

 

$

23,381,637

  

$

23,263,039

 

TOTAL ASSETS

 

$

164,341,107

  

$

162,568,442

 

GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF MARCH 31, 2022 AND DECEMBER 31, 2021 (Continued)

(IN U.S. DOLLARS)

 
  
  

March 31,

  

December 31,

 
  

2022

  

2021

 
       

Current Liabilities

      

Short-term bank loans

 

$

9,595,697

  

$

8,760,945

 

Notes payable-bank acceptance notes

  

37,072,247

   

42,093,061

 

Accounts payable

  

32,257,872

   

29,064,132

 

Taxes payables

  

-

   

108,058

 

Customer deposits

  

443,138

   

387,919

 

Due to related parties

  

2,022,459

   

3,619,459

 

Other current liabilities

  

2,307,551

   

1,198,427

 

Current portion of operating lease liabilities

  

33,816

   

33,308

 

Lease obligations - current

  

198,954

   

197,915

 

Total current liabilities

 

$

83,931,734

  

$

85,463,224

 
         

Long-term liabilities

        

Lease obligations – non-current

  

-

   

-

 

Long term operating lease  liabilities

  

38,994

   

47,614

 

Other long-term liabilities

  

2,159,936

   

2,212,938

 

Total long-term liabilities

 

$

2,198,930

  

$

2,260,552

 

TOTAL LIABILITIES

 

$

86,130,664

  

$

87,723,776

 
         

COMMITMENTS AND CONTINGENCIES

        

EQUITY

        

Ordinary shares, no par value, unlimited shares authorized; 11,329,530 and
   10,225,142 shares issued and outstanding as of December 31, 2021 and December
   31, 2020.

  

-

   

-

 

Additional paid-in capital

  

23,836,433

   

23,759,364

 

Statutory reserves

  

3,842,331

   

3,842,331

 

Retained earnings

  

35,455,748

   

33,668,696

 

Accumulated other comprehensive income (loss)

  

1,262,481

   

1,014,399

 

Total shareholders' equity

 

$

64,396,993

  

$

62,284,790

 

Non-controlling interest

  

13,813,450

   

12,559,876

 

TOTAL EQUITY

 

$

78,210,443

  

$

74,844,666

 
         

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY

 

$

164,341,107

  

$

162,568,442

 

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