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Kandi Technologies Reports First Quarter 2015 Financial Results

– Q1 EV Parts Sales Increased 71.3% YoY to 43.0 Million

– Q1 GAAP Net Income Increased to $6.1 Million from ($14.1) Million in Q1 2014

– Q1 GAAP EPS increased to $0.13 from ($0.36) in Q1 2014

JINHUA, China, May 11, 2015 (GLOBE NEWSWIRE) -- Kandi Technologies Group, Inc. (the "Company" or "Kandi") (Nasdaq:KNDI), today announced its financial results for the quarter ended March 31, 2015.

2015 First Quarter Highlights

  • Total revenues grew 9.0% to $43.8 million for the first quarter of 2015 from $40.2 million for the first quarter of 2014;
  • Electric Vehicle ("EV") Parts sales increased by 71.3% to $43.0 million for the first quarter of 2015 compared to $25.1 million in the same period of 2014;
  • The first quarter sales for our joint venture company, Kandi Electric Vehicles Group Co., Ltd. (the "JV Company")1, were $30.6 million, with net income of $0.8 million. Based on Kandi's 50% equity ownership in the JV Company, Kandi recorded $0.5 million in net income (after tax and intra-entity elimination) for the first quarter of 2015;
  • The JV Company sold 1,670 EV products during the first quarter of 2015, 37.4% increase compared to 1,215 EV products sold in the same quarter of 2014;
  • GAAP net income for the first quarter of 2015 was $6.1 million, or approximately $0.13 per fully diluted share, increased from a net loss of $14.1 million, or approximately ($0.36) in the first quarter of 2014;
  • Non-GAAP adjusted net income2, which excludes stock award expense and change in the fair value of financial derivatives, was $3.4 million, or approximately $0.07 per fully diluted share, a 108.1% increase from $1.6 million in the first quarter of 2014;
  • Working capital surplus was $40.9 million as of March 31, 2015, compared to $39.2 million as of December 31, 2014;
  • Cash, cash equivalents and restricted cash totaled $41.1 million as of March 31, 2015 compared to $39.4 million as of December 31, 2014;

Mr. Xiaoming Hu, Chairman and Chief Executive Officer of Kandi Technologies, commented: "We achieved solid growth in the first quarter of 2015 throughout our business, including the car-share projects, which continues to be a key growth driver for the Company this year. At the same time, our JV Company has started direct sales to consumers in April 2015, in order to meet the fast growing market demand in China, with great support from the Government, which will contribute to the Company's future growth and profitability."

"We are pleased with the good financial results in the first quarter of 2015, compared to the same quarter last year," added Mr. Wang Cheng, Chief Financial Officer of Kandi Technologies. "We had both revenue growth and margin improvement, which contributed to our net profits. We will continue to implement our cost reduction program throughout the Company and leverage internal production efficiencies, in order to generate stable profitability over the long term."

First Quarter 2015 Conference Call Details

The Company has scheduled a conference call and live webcast to discuss the financial results at 10:00 AM (U.S. EDT) on May 11, 2015 (10:00 PM Beijing time on May 11, 2015). Mr. Hu Xiaoming, Chief Executive Officer and Mr. Wang Cheng (Henry), Chief Financial Officer, will deliver prepared remarks, followed by a question and answer session.

The dial-in details for the conference call are as follows:

The live audio webcast of the call can also be accessed by visiting Kandi's Investor Relations website at http://en.kandivehicle.com in Investor Relations section. An archive of the webcast will be available on the Company's website following the live call.

1 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")

2 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.

KANDI TECHNOLOGIES GROUP, INC. AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND
COMPREHENSIVE INCOME (LOSS)

Three Months Ended
March 31, 2015 March 31, 2014
REVENUES, NET $ 43,781,086 $ 40,171,304
COST OF GOODS SOLD
37,410,353

35,310,895
GROSS PROFIT 6,370,733 4,860,409
OPERATING EXPENSES:
Research and development 571,020 1,172,257
Selling and marketing 113,895 71,257
General and administrative 3,780,648 6,470,766
Total Operating Expenses 4,465,563 7,714,280
INCOME FROM OPERATIONS 1,905,170 (2,853,871)
OTHER INCOME (EXPENSE):

Interest income 590,480 483,293
Interest (expense) (598,591) (954,473)
Change in fair value of financial instruments 4,750,300 (12,314,171)
Government grants -- --
Share of (loss) in associated companies -- (15,805)
Share of profit after tax of JV 469,356 1,728,356
Other income, net 23,847 59,580
Total other income (expense), net 5,235,392 (11,013,220)
INCOME (LOSS) BEFORE INCOME TAXES 7,140,562 (13,867,091)
INCOME TAX EXPENSE (1,008,909) (219,069)
NET INCOME (LOSS) 6,131,653 (14,086,160)
OTHER COMPREHENSIVE INCOME
Foreign currency translation 493,211 (1,211,116)
COMPREHENSIVE INCOME (LOSS) $ 6,624,864 $ (15,297,276)
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC
46,281,299

39,597,785
WEIGHTED AVERAGE SHARES OUTSTANDING DILUTED 46,397,993 39,597,785
NET INCOME (LOSS) PER SHARE, BASIC $ 0.13 $ (0.36)
NET INCOME (LOSS) PER SHARE, DILUTED
$ 0.13 $ (0.36)
KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
ASSETS
March 31, December 31,
2015 2014
Current assets
Cash on cash equivalents $ 15,635,658 $ 26,379,460
Restricted cash 25,454,249 13,000,731
Accounts receivable 28,679,895 15,736,805
Inventories (net of provision for slow moving inventory of 316,686 and 315,584 as of March 31, 2015 and December 31, 2014, 26,742,009 15,403,840
respectively
Notes receivable 10,739,366 9,060,441
Other receivables 323,925 238,567
Prepayments and prepaid expense 462,058 120,761
Due from employees 40,084 34,475
Advances to suppliers 7,112,895 6,901,505
Amount due from JV Company, net 71,267,257 51,450,612
Deferred taxes assets --
TOTAL CURRENT ASSETS 186,457,396 138,327,197
LONG-TERM ASSETS
Plant and equipment, net 25,174,878 26,215,356
Land use rights, net 15,606,056 15,649,152
Construction in progress 58,753,641 58,510,051
Deferred taxes assets -- --
Investment in associated company -- --
Investment in JV Company 84,070,778 83,309,095
Goodwill 322,591 322,591
Intangible assets 556,877 577,401
Other long term assets 163,076 162,509
TOTAL Long-Term Assets 184,647,897 184,746,155
TOTAL ASSETS $ 371,105,293 $ 323,073,352
KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED BALANCE SHEETS
LIABILITIES AND STOCKHOLDERS' EQUITY
March 31, December 31,
2015 2014
CURRENT LIABILITIES
Accounts payables $ 77,954,005 $ 45,772,481
Other payables and accrued expenses 3,803,523 5,101,740
Short-term loans 42,073,678 35,589,502
Customer deposits 2,641,274 2,630,723
Notes payable 12,408,147 5,702,121
Income tax payable 1,711,161 1,835,685
Due to employees 11,071 15,787
Deferred taxes liabilities 132,399 230,864
Financial derivate - liability 4,800,169 2,245,610
Total Current Liabilities 145,535,427 99,124,513
LONG-TERM LIABILITIES
Deferred taxes liabilities 2,543,821 2,266,725
Bond payable -- --
Financial derivate - liability 2,792,416 10,097,275
Total Long-Term Liabilities 5,336,237 12,364,000
TOTAL LIABILITIES 150,871,664 111,488,513
STOCKHOLDER'S EQUITY
Common stock, $0.001 par value; 100,000,000 shares authorized; 46,284,855 and 46,274,855 shares issued and outstanding at March
31,2015 and December 31,2014, respectively
46,285 46,275
Additional paid-in capital 192,281,953 190,258,037
Retained earnings (the restricted portion is $4,172,324 and $4,172,324 at March 31,2015 and December 31,2014, respectively) 22,522,077 16,390,424
Accumulated other comprehensive income(loss) 5,383,314 4,890,103
TOTAL STOCKHOLDERS' EQUITY 220,233,629 211,584,839
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY $ 371,105,293 $ 323,073,352
KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
Three Months Ended
March 31, 2015 March 31, 2014
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income(loss) $ 6,131,653 $ (14,086,160)
Adjustments to reconcile net income to net cash provided by operating activities
Depreciation and amortization 1,479,384 1,386,527
Assets Impairments -- --
Deferred taxes -- 44,801
Change in fair value of financial instruments (4,750,300) 12,314,171
Loss (income) in investment in associated companies -- 15,805
Share of profit after tax of JV Company (469,356) (1,728,356)
Decrease in reserve for fixed assets -- --
Stock Compensation cost 2,049,683 --
Changes in operating assets and liabilities, net of effects of acquisition:
(Increase) Decrease In:
Accounts receivable (12,844,602) 8,501,760
Inventories (11,246,265) (4,567,411)
Other receivables (65,602) (154,488)
Due from employee (10,225) (9,402)
Prepayments and prepaid expenses (527,687) (7,691,861)
Amount due from JV Company (19,570,708) (18,868,380)
Increase (Decrease) In:
Accounts payable 31,915,168 21,589,347
Other payables and accrued liabilities (1,438,571) 930,528
Customer deposits 1,365 92,022
Income Tax payable (130,488) (815,354)
Due to related party -- --
Net cash (used in ) provided by operating activities $ (9,476,551) $ (3,046,451)
CASH FLOWS FROM INVESTING ACTIVITIES:
(Purchases)/Disposal of plant and equipment, net (233,343) (119,476)
Purchases of land use rights -- --
Purchases of construction in progress (39,266) --
Deposit for acquisition -- --
Asset acquisition, net of deposit -- --
Issuance of notes receivable (4,225,884) (21,553,430)
Repayment of notes receivable 2,584,147 --
Investment in JV Company -- --
Cash acquired in acquisition -- --
Net cash provided by (used in) investing activities $ (1,914,346) $ (21,672,906)
CASH FLOWS FROM FINANCING ACTIVITIES:
Restricted cash (12,366,201) 1,634
Proceeds from short-term bank loans 6,338,475 817,013
Repayments of short-term bank loans -- (817,013)
Proceeds from notes payable 6,663,525 (1,960,832)
Fund raising through issuing common stock and warrants -- 11,067,734
Option exerciseCstock awards & other financing -- 3,066,081
Warrant exercise -- 20,484,279
Common stock issued for acquisition, net of cost of capital
Net cash (used in) provided by financing activities 635,799 32,658,896
NET INCREASE IN CASH AND CASH EQUIVALENTS (10,755,098) 7,939,539
Effect of exchange rate changes on cash 11,296 (203,633)
Cash and cash equivalents at beginning of year 26,379,460 12,762,369
CASH AND CASH EQUIVALENTS AT END OF PERIOD 15,635,658 20,498,275
SUPPLEMENTARY CASH FLOW INFORMATION
Income taxes paid 1,139,397 1,034,422
Interest paid 577,874 580,044

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 China's leading manufacturers of pure electric vehicle ("EV") products (through its joint venture), 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: Company Contact: Ms. Kewa Luo Kandi Technologies Group, Inc. Phone: 1-212-551-3610 Email: IR@kandigroup.com IR Contact: Mr. Matthew Abenante The Piacente Group Phone: 1-212-481-2050 Email: kandi@tpg-ir.comSource:Kandi Technologies, Corp.