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Kandi Technologies Reports Record Full Year 2014 Financial Results

Full year 2014 revenue increased 80% YoY to $170.2 Million

Full year 2014 EV parts sales jumped 6653% YoY to $116.4 Million

Full year GAAP net income increased 158% YoY to $12.3 Million

Full year EPS of $0.29 compared to 2013 EPS of ($0.61)

JINHUA, China, March 16, 2015 (GLOBE NEWSWIRE) -- Kandi Technologies Group, Inc. (Nasdaq:KNDI) (the "Company" or "Kandi"), today announced its financial results for the full year ending December 31, 2014.

Full Year 2014 Highlights

  • Total revenues grew 80.1% to $170.2 million from $94.5 million in 2013;
  • Electric Vehicle ("EV") Parts sales increased significantly by 6,653.4% to $116.4 million compared to $1.7 million in the previous year;
  • Full year sales for our joint venture company, Kandi Electric Vehicles Group Co., Ltd. (the "JV Company"),* were $215.5 million, with net income of $7.5 million. Based on Kandi's 50% equity ownership in the JV Company, Kandi recorded $4.5 million in net income (after tax and intra-entity elimination) in 2014;
  • The JV Company sold 10,935 EV products during the full year of 2014, with 3,656 EVs sold in the fourth quarter;
  • GAAP net income in 2014 was $12.3 million, or approximately $0.29 per fully diluted share, a 158.0% increase compared to a net loss of $21.1 million, or approximately ($0.61) in 2013;
  • Non-GAAP adjusted net income**, which excludes stock award expense and change in the fair value of financial derivatives, was $14.2 million, or approximately $0.33 per fully diluted share, a 174.8% increase from $5.2 million for 2013;
  • Working capital surplus was $39.2 million as of December 31, 2014, compared to a working capital deficit of $6.6 million as of December 31, 2013;
  • Cash, cash equivalents and restricted cash totaled $39.3 million as of December 31, 2014 compared to $12.8 million as of December 31, 2013;

*Kandi Electric Vehicles Group Co., Ltd., a joint venture company established by the Company's wholly owned subsidiary, Zhejiang Kandi Vehicles Co., Ltd. with Shanghai Maple Guorun Automobile Co., Ltd. ("Shanghai Guorun"), a 99%-owned subsidiary of Geely Automobile Holdings Ltd. ("Geely Auto")

**Non-GAAP measures, including the Non-GAAP net income and Non-GAAP EPS are defined as the financial measures excluding the change of the fair value of financial derivatives and the effects of the stock award expense. We supply non-GAAP information because we believe it allows our investors to obtain a clearer understanding of our operations. Any non-GAAP measures 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. Xiaoming Hu, Chairman and Chief Executive Officer of Kandi Technologies commented, "Our robust financial results were driven by the growing market demand for electric vehicles. In 2014, we invested a tremendous amount of time and resources on building our EV business. Kandi's electric vehicle model has been highly appraised by China's Science and Technology Minister and other senior government officials. At the end of 2014, Micro Public Transportation (MPT), an EV Sharing Program we have been advocating, has expanded to nine Chinese cities with 14,398 pure EVs delivered since the beginning of its trial operation in the second half of 2013."

"Looking ahead, we are extremely excited about Kandi's business prospects for continued growth. Given the government's strong commitment towards policies that encourage the adoption of electric vehicles nationwide, including the national and local government subsidies, the electric vehicle tax breaks, along with the prevailing favorable market conditions in China, we are confident in our ability to execute our strategy to further grow market shares in China. Recently, the management team of our joint venture company has decided to expand its EV sales effort directly to the end customers, which, together with JV's existing fleet sales model, will be a key catalyst that boost consumer demand for our electric vehicles. We look forward to enhancing our overall product and service, while leveraging the JV Company's flexible business model and its leading position in both EV sharing and EV sales businesses, and finally making Kandi a leader in the EV market in China," Mr. Hu concluded.

KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME AND COMPREHENSIVE INCOME
FOR THE YEARS ENDED DECEMBER 31, 2014, 2013 AND 2012
2014 2013 2012
REVENUES, NET $ 170,229,006 $ 94,536,045 $ 64,513,670
COST OF GOODS SOLD (146,825,073) (72,793,517) (51,620,280)
GROSS PROFIT 23,403,933 21,742,528 12,893,390
OPERATING EXPENSES:
Research and development (2,755,637) (3,728,730) (2,877,283)
Selling and marketing (1,345,588) (399,504) (455,983)
General and administrative (14,058,548) (16,056,107) (4,250,832)
Total operating expenses (18,159,773) (20,184,341) (7,584,098)
INCOME FROM OPERATIONS 5,244,160 1,558,187 5,309,292
OTHER INCOME (EXPENSE):
Interest income 1,701,121 1,516,477 2,658,104
Interest (expense) (3,480,646) (4,395,353) (2,775,891)
Change in fair value of financial instruments 6,531,308 (16,647,283) 1,986,063
Government grants 288,498 228,396 132,139
Share of (loss) in associated companies (54,308) (69,056) (69,429)
Share of profit (loss) after tax of JV 4,490,266 (2,414,354) --
Other income (expense), net (34,649) 676,257 332,936
Total other income (expense), net 9,441,590 (21,104,916) 2,263,922
INCOME (LOSS) BEFORE PROVISION FOR INCOME TAXES 14,685,750 (19,546,729) 7,573,214
PROVISION FOR INCOME TAXES (2,414,412) (1,593,994) (1,523,735)
NET INCOME (LOSS) 12,271,338 (21,140,723) 6,049,479
OTHER COMPREHENSIVE INCOME
Foreign currency translation (2,725,143) 2,112,902 424,623
COMPREHENSIVE INCOME (LOSS) $ 9,546,195 $ (19,027,821) $ 6,474,102
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC 42,583,495 34,707,973 29,439,328
WEIGHTED AVERAGE SHARES OUTSTANDING DILUTED 42,715,818 34,707,973 29,677,325
NET INCOME (LOSS) PER SHARE, BASIC $ 0.29 $ (0.61) $ 0.21
NET INCOME (LOSS) PER SHARE, DILUTED $ 0.29 $ (0.61) $ 0.20
KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
ASSETS
December 31, December 31,
2014 2013
CURRENT ASSETS
Cash and cash equivalents $ 26,379,460 $ 12,762,369
Restricted cash 13,000,731 1,636
Accounts receivable 15,736,805 31,370,862
Inventories (net of provision for slow moving inventory of $315,584 and $352,734 as of December 31, 2014 and 2013 respectively) 15,403,840 9,187,714
Notes receivable 9,060,441 13,794,094
Other receivables 238,567 556,904
Prepayments and prepaid expenses 120,761 505,513
Due from employees 34,475 34,272
Advances to suppliers 6,901,505 8,867,074
Amount due from JV Company, net 51,450,612 2,917,592
Deferred tax -- 13,706
Total Current Assets 138,327,197 80,011,736
LONG-TERM ASSETS
Plant and equipment, net 26,215,356 29,333,516
Land use rights, net 15,649,152 14,453,191
Construction in progress 58,510,051 16,356
Deferred taxes -- 81,076
Investment in associated company -- 96,838
Investment in JV Company 83,309,095 79,331,930
Goodwill 322,591 322,591
Intangible assets 577,401 659,496
Other long-term assets 162,509 --
Total Long-Term Assets 184,746,155 124,294,994
TOTAL ASSETS $ 323,073,352 $ 204,306,730
KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
December 31, December 31,
2014 2013
CURRENT LIABILITIES
Accounts payable $ 45,772,481 $ 22,843,143
Other payables and accrued expenses 5,101,740 2,422,613
Short-term bank loans 35,589,502 34,020,281
Customer deposits 2,630,723 44,404
Notes payable 5,702,121 16,683,023
Income tax payable 1,835,685 1,362,828
Due to employees 15,787 10,297
Deferred taxes 230,864 --
Financial derivate - liability 2,245,610 9,256,827
Total Current Liabilities 99,124,513 86,643,416
LONG-TERM LIABILITIES
Deferred tax 2,266,725 1,009,477
Bond payable -- 13,084,724
Financial derivatives - liability 10,097,275 15,042,994
Total Long-Term Liabilities 12,364,000 29,137,195
TOTAL LIABILITIES 111,488,513 115,780,611
STOCKHOLDERS' EQUITY
Common stock, $0.001 par value; 100,000,000 shares authorized; 46,274,855 and 37,012,904 shares issued and outstanding at December 31, 2014 and 2013, respectively 46,275 37,013
Additional paid-in capital 190,258,037 76,754,774
Retained earnings (the restricted portion is $4,172,324 and $3,807,551 at December 31, 2014 and 2013, respectively) 16,390,424 4,119,086
Accumulated other comprehensive income 4,890,103 7,615,246
TOTAL STOCKHOLDERS' EQUITY 211,584,839 88,526,119
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 323,073,352 $ 204,306,730
KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOW
FOR THE YEARS ENDED DECEMBER 31, 2014, 2013 AND 2012
2014 2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income (loss) $ 12,271,338 $ (21,140,723) $ 6,049,479
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 5,571,465 7,708,923 4,978,626
Assets impairments -- 355,876 465,199
Deferred taxes 1,579,855 876,255 92,521
Change in value of financial instruments (6,531,308) 16,647,283 (1,986,063)
Loss in investment in associated company 54,308 69,056 69,429
Share of profit after tax of JV (4,490,266) 2,414,354 --
Decrease in reserve for fixed assets (302,023) -- --
Option cost -- -- 19,053
Changes in operating assets and liabilities, net of effects of acquisition:
(Increase) Decrease In:
Accounts receivable 15,445,962 3,251,168 (20,513,099)
Inventories (6,280,502) (1,287,045) (904,355)
Other receivables 315,071 (38,491) 1,955,055
Due from employees 5,139 10,797 37,117
Prepayments and prepaid expenses (5,360,637) (3,810,447) (4,285,489)
Amount due from JV (48,593,522) (2,877,972) --
Increase (Decrease) In:
Accounts payable 23,095,825 13,699,528 3,566,354
Other payables and accrued liabilities 2,694,689 (746,838) (50,333)
Customer deposits 2,588,830 (254,151) (740,419)
Income tax payable 482,020 651,124 525,030
Due to related party -- (841,251) --
Net cash (used in) provided by operating activities (7,453,756) 14,687,446 (10,721,895)
CASH FLOWS FROM INVESTING ACTIVITIES:
(Purchases)/Disposal of plant and equipment, net (2,101,355) (158,830) (9,072,230)
Purchases of land use rights (1,668,534) -- --
Purchases of construction in progress (50,891,170) (16,134) --
Deposit for acquisition -- -- (24,383,529)
Asset acquisition, net of deposit -- (39,673,000) --
Disposal of subsidiary (96,299) 64,535,177 --
Issuance of notes receivable (24,705,489) (4,174,247) (1,011,821)
Repayments of notes receivable 29,354,592 311,844 29,603,171
Investment in JV -- (80,668,972) --
Cash acquired in acquisition -- -- 112,551
Net cash (used in) investing activities (50,108,255) (59,844,162) (4,751,858)
CASH FLOWS FROM FINANCING ACTIVITIES:
Restricted cash (13,010,291) 16,135,044 (9,143,907)
Proceeds from short-term bank loans 48,306,743 52,918,845 41,504,215
Repayments of short-term bank loans (46,517,604) (52,596,170) (45,539,128)
Proceeds from notes payable 18,718,944 83,251,992 40,491,531
Repayments of notes payable (29,602,112) (92,609,593) (21,063,559)
Proceeds from bond payable -- 12,907,035 12,658,548
Repayments of bond payable (13,011,917) (12,907,035) --
Fund raising through issuing common stock and warrants 78,358,991 26,387,498 --
Option exercise, stock award & other financing 8,431,247 9,659,103 1,258,231
Warrant exercise 21,101,039 3,171,259 1,672,739
Common stock issued for acquisition, net of cost of capital -- -- 3,784,149
Net cash provided by financing activities 72,775,040 46,317,978 25,622,819
NET INCREASE IN CASH AND CASH EQUIVALENTS 15,213,029 1,161,262 10,149,066
Effect of exchange rate changes on cash (1,595,938) (533,989) (308,322)
Cash and cash equivalents at beginning of year 12,762,369 12,135,096 2,294,352
CASH AND CASH EQUIVALENTS AT END OF YEAR $ 26,379,460 $ 12,762,369 $ 12,135,096
SUPPLEMENTARY CASH FLOW INFORMATION
Income taxes paid $ 1,932,392 $ 942,870 $ 998,706
Interest paid $ 3,475,893 $ 3,565,496 $ 2,570,691
Issuance of Common stock for acquisition $ -- $ -- $ 8,616,416
SUPPLEMENTAL NON-CASH DISCLOSURES:
Prepayments transferred to construction in progress $ 7,652,959 $ -- $ --
Construction in progress transferred to plant and equipment $ -- $ -- $ 10,078,637

About Kandi Technologies Group, Inc.

Kandi Technologies Group, Inc. (Nasdaq:KNDI), headquartered in Jinhua, Zhejiang Province, is engaged in the research and development, manufacturing and sales of various vehicle products. Kandi has established itself as the one of the China's leading manufacturers of pure electric vehicle ("EV") products, EV parts and off road vehicles. More information can be viewed at its corporate website is http://www.kandivehicle.com. The Company routinely posts important information on its website.

Safe Harbor Statement

This press release contains certain statements that may include "forward-looking statements." All statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involving known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including the risk factors discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on the SEC's website (http://www.sec.gov). All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.

CONTACT: IR Contact: Kandi Technologies Group, Inc. Ms. Kewa Luo Phone: 1-212-551-3610 Email: IR@kandigroup.comSource:Kandi Technologies, Corp.