Greenland Technologies Reports Third Quarter 2022 Unaudited Financial Results

3Q22 Net Income Increases 67% Compared to 3Q21

EAST WINDSOR, N.J., Nov. 9, 2022 /PRNewswire/ — 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 third quarter ended September 30, 2022.

Greenland Technologies (NASDAQ: GTEC)
Greenland Technologies (NASDAQ: GTEC)

Third Quarter 2022 Financial and Operating Highlights

  • Total revenue was $21.8 million, compared with $23.1 million a year ago.
  • Gross margin was 22.1%, on par with the same period of 2021.  
  • Total operating expenses was $2.7 million, 10% lower from a year ago due to improved operating efficiencies.
  • Net income was $2.1 million, an increase of 67% from $1.3 million in the same period of 2021.
  • Transmissions products sold were 31,303 units, slightly higher than 31,050 units last year.

Mr. Raymond Wang, Chief Executive Officer of Greenland Technologies Holding Corporation, commented, "While we are not immune to the ongoing global supply chain challenges, inflationary pressures and lockdowns in China, we made significant progress in the areas that will drive our long-term growth and build value for shareholders. For example, we are firmly on track with our capacity plans for the U.S., and we are seeing an improvement in the supply chain with lower freight costs and speed.  We are also benefitting from the full support of Maryland’s local and state level officials after formally opening our new Baltimore facility. They share in our leadership vision of the opportunities for electrification of industrial vehicles and the positive economic impact from job creation, related commerce and positives for the environment.  This represents a significant opportunity for Greenland and the communities we operate in."

"We are also pleased with the additional innovation and further development with our strategic partners of new features for our vehicles that not only differentiate our HEVI brand but add premium value for our customers, including tracking now available with vehicle purchase. This is an essential selling point as operators laser focus on fleet ROI and asset utilization. Overall, we continue to benefit from several Greenland-specific catalysts. We are entering Q4 with a solid backlog and expect our results to more accurately reflect our business fundamentals as we move through 2023 and current headwinds become tailwinds. Longer-term we continue to make steady progress toward our ambitious goals, including the ramping our new U.S. assembly facility. This will serve as a powerful, high visibility showcase for our vehicles, which we expect will drive sales by helping us convert customer interest into orders when they see our innovative vehicles in person." 

Mr. Jing Jin, Chief Financial Officer of Greenland, commented: "Our third quarter revenue was negatively impacted by the stronger dollar. Excluding FX impact, our revenue in Chinese RMB actually grew 2% year-over-year.  During Q3, we also improved our operating efficiency by streamlining and simplifying our product lines, which led to a 10% decrease in our operating expenses and contributed to our 67% increase in net income. Looking ahead, we will continue to manage operating expenses closely as we shift our focus towards ramping up HEVI production capacity and deployment capabilities."

Recent Developments and Strategic Highlights:

  • Launched Vehicle Tracking System: Greenland selected Cyngn Inc. ("Cyngn") (Nasdaq: CYN), a developer of innovative autonomous driving solutions for industrial and commercial applications, as the exclusive supplier of Infinitracker asset tracking systems for the Company’s HEVI electric industrial vehicles. The Infinitrackers will enable HEVI vehicle consumers to track their vehicle locations through a simple web portal.
  • Launch of Assembly Site in Baltimore, Maryland: Greenland opened a 54,000 square foot assembly facility in Baltimore, Maryland to support local service, assembly, and distribution of its electric industrial heavy equipment product line. The Company anticipates this facility will be able to produce over 500 units a year and create 4 to 5 dozen green jobs at full capacity.
  • Siemens EV Chargers Compatible with HEVI Products: HEVI electric products has successfully tested compatible with Siemens’s EV charging station network at their site in Wendell, NC.  This is the start of a campaign to ensure HEVI compatibility with all major EV charging station providers in the US.
  • Closed $10 Million Registered Direct and Private Placement: Greenland raised $10.0 million via a registered offering and a private placement with Aegis Capital Corp as the placement agent. This transaction significantly strengthen Greenland’s balance sheet and the Company intends to use the net proceeds for working capital and general corporate purposes.

Third Quarter 2022 Financial Results

Total revenue was $21.8 million, compared with $23.1 million in the third quarter of 2021, primarily due to the impact of unfavorable foreign exchange. On an RMB basis, total revenues increased by approximately 2% from the third quarter of 2021. The number of transmission products sold was 31,303 units, up 1% from 31,050 units in the third quarter of 2021.

Costs of goods sold were $17.0 million, a decrease of 6% from $18.0 million in the third quarter of 2021, primarily due to the impact of foreign exchange.

Gross profit was $4.8 million, compared with $5.1 million in the third quarter of 2021, primarily due to the impact of unfavorable foreign exchange. Gross margin was 22.1%, on par with the third quarter of 2021.

Total operating expenses were $2.7 million, a decrease of 10% from $3.0 million in the third quarter of 2021. Operating expenses as a percentage of total revenues was 12.6%, down 60 basis points from 13.2% in the third quarter of 2021. The decrease in operating expenses was primarily due to improved operating efficiency.

Income from operations was $2.07 million, an increase of 1% from $2.05 million in the third quarter of 2021. 

Net income was $2.1 million, an increase of 67% from $1.3 million in the third quarter of 2021, primarily due to improved operating efficiency, increase in grant income and lower effective tax rate.

Basic and diluted net income per ordinary share were both $0.1, compared with $0.09 in the third quarter of 2021.

Conference Call

Greenland Technologies management will host an earnings conference call at 8:00 AM on Wednesday, November 9, 2022, U.S. Eastern Time (9:00 PM on November 9, 2022, Beijing/Hong Kong Time).

Participant Registration

Investors and analysts interested in participating in Greenland’s third quarter 2022 earnings call need to register in advance using the URL provided below. Conference access information will be provided upon registration.

Participant Online Pre-Registration: https://register.vevent.com/register/BIe16b8fc2914c4c76ba13993c76c2a903

A live and archived webcast will also be available on the investor relations section of Greenland’s website 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.

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.

 

GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE THREE AND NINE MONTHS ENDED SEPTEMBER 30, 2022 AND 2021

(UNAUDITED, IN U.S. DOLLARS)

For the three months ended

September 30,

For the nine months ended

September 30,

2022

2021

2022

2021

REVENUES

$

21,786,862

$

23,084,793

$

71,696,324

$

75,899,994

COST OF GOODS SOLD

16,974,566

17,987,363

55,676,893

59,993,008

GROSS PROFIT

4,812,296

5,097,430

16,019,431

15,906,986

Selling expenses

521,865

522,770

1,679,600

1,397,462

General and administrative expenses

1,192,210

1,150,769

3,716,590

2,814,120

Research and development expenses

1,023,443

1,372,215

2,968,572

3,337,056

Total operating expenses

$

2,737,518

$

3,045,754

$

8,364,762

$

7,548,638

INCOME FROM OPERATIONS

$

2,074,778

$

2,051,676

$

7,654,669

$

8,358,348

Interest income

12,790

4,737

35,239

14,165

Interest expense

(125,981)

(106,506)

(322,641)

(508,359)

Loss on disposal of property and equipment

(301)

(695)

(959)

Other income

655,838

231,466

1,418,580

830,515

INCOME BEFORE INCOME TAX

$

2,617,124

$

2,181,373

$

8,785,152

$

8,693,710

INCOME TAX

518,931

927,844

1,392,735

1,844,619

NET INCOME

$

2,098,193

$

1,253,529

$

7,392,417

$

6,849,091

LESS: NET INCOME ATTRIBUTABLE TO
   NONCONTROLLING INTEREST

820,229

225,181

2,840,137

911,422

NET INCOME ATTRIBUTABLE TO GREENLAND
   TECHNOLOGIES HOLDING CORPORATION
   AND SUBSIDIARIES

$

1,277,964

$

1,028,348

$

4,552,280

$

5,937,669

OTHER COMPREHENSIVE INCOME (LOSS):

(4,552,121)

(605,515)

(8,253,663)

(29,781)

Unrealized foreign currency translation income (loss)
   attributable to Greenland Technologies Holding
   Corporation and subsidiaries

(2,974,517)

(433,694)

(5,446,475)

(31,313)

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

(1,577,604)

(171,821)

(2,807,188)

1,532

Comprehensive income (loss)

(1,696,553)

594,654

(894,195)

5,906,356

Noncontrolling interest

(757,375)

53,360

32,949

912,954

WEIGHTED AVERAGE ORDINARY SHARES
   OUTSTANDING:

Basic and diluted

12,222,387

11,329,530

11,628,243

10,715,132

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

Basic and diluted

0.10

0.09

0.39

0.55

 

GREENLAND TECHNOLOGIES HOLDING CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

AS OF SEPTEMBER 30, 2022 AND DECEMBER 31, 2021

(UNAUDITED, IN U.S. DOLLARS)

September 30,

December 31,

2022

2021

   ASSETS

   Current assets

Cash and cash equivalents

$

11,306,600

$

11,062,590

Restricted cash

3,720,931

6,738,302

Short Term Investment

12,243,140

2,105,938

Notes receivable

31,606,518

37,551,121

Accounts receivable, net of allowance for doubtful accounts of $774,452 and
   $859,319, respectively

18,344,356

15,915,002

Inventories

21,884,848

25,803,474

Due from related parties-current

35,462,308

39,679,565

Advance to suppliers

676,823

434,893

Prepayments and other current assets

96,323

14,518

Total Current Assets

$

135,341,847

$

139,305,403

Non-current asset

Property, plant, equipment and construction in progress, net

15,503,755

18,957,553

Land use rights, net

3,550,039

4,035,198

Other intangible assets

157,153

Deferred tax assets

126,872

141,623

Goodwill

3,890

3,890

Operating lease right-of-use assets

2,748,910

80,682

Other non-current assets

242,866

44,093

Total non-current assets

$

22,333,485

$

23,263,039

TOTAL ASSETS

$

157,675,332

$

162,568,442

 

September 30,

December 31,

2022

2021

Current Liabilities

Short-term bank loans

$

8,715,822

$

8,760,945

Notes payable-bank acceptance notes

33,716,344

42,093,061

Accounts payable

23,954,824

29,064,132

Taxes payables

108,058

Customer deposits

196,125

387,919

Due to related parties

1,594,227

3,619,459

Other current liabilities

1,622,362

1,198,427

Current portion of operating lease liabilities

462,365

33,308

Long-term payables – current

197,915

Total current liabilities

$

70,262,069

$

85,463,224

Long-term liabilities

Long-term payables – non-current

Long term operating lease liabilities

2,293,844

47,614

Other long-term liabilities

1,828,340

2,212,938

Total long-term liabilities

$

4,122,184

$

2,260,552

TOTAL LIABILITIES

$

74,384,253

$

87,723,776

COMMITMENTS AND CONTINGENCIES

EQUITY

Ordinary shares, no par value, unlimited shares authorized; 12,579,530 and
   11,329,530 shares issued and outstanding as of September 30, 2022 and
   December 31, 2021.

Additional paid-in capital

32,955,927

23,759,364

Statutory reserves

3,842,331

3,842,331

Retained earnings

38,220,976

33,668,696

Accumulated other comprehensive income (loss)

(4,432,076)

1,014,399

Total shareholders’ equity

$

70,587,158

$

62,284,790

Non-controlling interest

12,703,921

12,559,876

TOTAL EQUITY

$

83,291,079

$

74,844,666

TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY

$

157,675,332

$

162,568,442

 

 

 

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