CHENGDU, China, Feb. 15, 2020 /PRNewswire/ -- Senmiao Technology Limited (NASDAQ: AIHS) ("Senmiao"), a provider of automobile transaction and related services in China, today announced its unaudited financial results for its third fiscal quarter ended December 31, 2019.
Third Quarter of Fiscal 2020 Highlights
"The discontinuation of our online peer-to-peer lending operations will allow us to effectively focus our resources on the current automobile financing facilitation and transaction business, which remained profitable through the first nine months of this fiscal year," commented Xi Wen, Chairman, Chief Executive Officer and President of Senmiao. "Due to a general industry year-end slowdown, there was a seasonal decrease in our facilitation of new automobile purchases this quarter but we continued to capitalize on strategic opportunities in cities like Chengdu and Changsha where we are expanding our business. Looking ahead, in light of the Chinese New Year holidays and the current coronavirus outbreak in China, we anticipate that the fourth fiscal quarter will be a challenging one. However, despite extensive restrictions being put in place to combat the nationwide coronavirus outbreak, we believe that the long-term market opportunity for ride-hailing services in China remains compelling. We are developing ways to assist our ride-hailing drivers contend with the challenges posed by the outbreak. This is a difficult time for the industry and our nation, but we are confident that our company will overcome the challenges in the short-term, continue to expand our automobile business and create long-term sustainable value for our shareholders."
Revenues
Total revenue was $2,745,579 for the quarter ended December 31, 2019, an increase of $2,626,843, or 2,212% as compared with the quarter ended December 31, 2018, primarily due to Senmiao's significant shift in operations to the automobile transaction and related services business (the "Auto Business"). Total revenue excludes $4,294 in revenue from online lending services that is now a discontinued business.
Because of the Chinese National Day holiday in October and general industry year end slowdown, there was a seasonal decrease in the number of Senmiao's facilitated new automobile purchases for the three months ended December 31, 2019 as compared with the prior quarters in current year. However, due to the expansion of the Auto Business in Chengdu and Changsha, Senmiao's revenue increased as compared with the same period in the prior year.
In response to the changing regulatory environment in China, Senmiao discontinued operations of its online peer-to-peer lending business in third fiscal quarter to proactively restructured operations in order to position itself for future sustainable growth.
Cost of Revenues
Cost of revenues was $1,901,405 for the quarter ended December 31, 2019. Senmiao did not incur cost of revenues during the same period last year as it only provided online lending services which did not incur any cost of revenues.
Gross Profit
Gross profit was $844,174. Gross profit increased by $725,438 mainly due to the increase in the number of facilitated new automobile purchases from the Auto Business.
Selling, General and Administrative Expenses
Selling, general and administrative expenses were $1,339,238 for the quarter ended December 31, 2019 as compared to $529,913 during the same period last year, representing an increase of $809,325. The increase was mainly attributable to the selling, general and administrative expenses of $966,771 incurred by the expansion of the Auto Business.
Change in Fair Value of Derivative Liabilities
The change in fair value of derivative liabilities resulted in a loss $485,400, derived from change of the fair values between December 31, 2019 and September 30, 2019 of the warrants issued in Senmiao's registered direct offering in June 2019.
Net Loss
Total net loss for the quarter ended December 31, 2019 was $5,361,936 as compared to a net loss of $768,292 during the same period last year. Net loss from continuing operations and discontinued operations for the quarter ended December 31, 2019 was $962,700 and $4,399,236 as compared to a net loss of $406,631 and $361,661, respectively, during the same period last year.
Earnings / loss per share
Loss per share for continuing operations was $0.03 and $0.02 and loss per share for discontinued operations was $0.15 and $0.01, respectively, for the quarters ended December 31, 2019 and 2018. Earnings per share was $0.03 for continuing operations in the nine months ended December 31, 2019 as compared with loss per share of $0.04 in the same period last year. Loss per share was $0.20 for discontinued operations in the nine months ended December 31, 2019 as compared with $0.06 in the same period last year.
Financial Position
As of December 31, 2019, Senmiao had cash and cash equivalents of $1,173,521 as compared to $3,967,980 as of March 31, 2019 for its continuing operations. Senmiao also had cash and cash equivalents of $9,520 as of December 31, 2019 as compared to $1,052,430 as of March 31, 2019 for its discontinued operations.
For additional related information, please see Senmiao's Quarterly Report on Form 10-Q for the quarter ended December 31, 2019, which is being filed with the U.S. Securities and Exchange Commission today.
About Senmiao
Headquartered in Chengdu, Sichuan Province, Senmiao provides automobile transaction and related services including sales of automobiles, facilitation and services for automobile purchase and financing, management, guarantee and other automobile transaction services aimed principally at the growing ride-sharing market in Senmiao's areas of operation in China. For more information about Senmiao, please visit: http://www.senmiaotech.com.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning the development of Senmiao's Auto Business, the Chinese ride-sharing and automobile financial leasing markets, and Senmiao's plans, objectives, goals, strategies, and performance, as well as the assumptions such statements and other statements that are not statements of historical facts. When Senmiao uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "estimate" or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause actual results to differ materially from Senmiao's expectations, including, but not limited to, risks and uncertainties relating to the following: the risk that the anticipated growth of Senmiao's Auto Business may not be realized; the risks associated with the discontinuance of Senmiao's online lending business; Senmiao's future business development; product and service demand and acceptance; the risks and impact of the ongoing coronavirus outbreak in China; changes in technology; economic conditions; reputation and brand; the impact of competition and pricing; the impact of government regulations; fluctuations in general economic and business conditions in China and other risks expressed in reports filed by Senmiao with the U.S. Securities and Exchange Commission. For these reasons, among others, investors are cautioned not to place undue reliance on any forward-looking statements. Senmiao's filings with the U.S. Securities and Exchange Commission are available for review at www.sec.gov. Senmiao undertakes no obligation to publicly revise any forward-looking statements to reflect changes in events or circumstances.
For more information, please contact:
At the Company:
Yiye Zhou
Email: edom333@ihongsen.com
Phone: +86 28 6155 4399
Investor Relations:
Linda Bergkamp
Christensen
Email: lbergkamp@ChristensenIR.com
Phone: +1 480 614 3004
SENMIAO TECHNOLOGY LIMITED |
|||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
|||||||
(Expressed in U.S. dollar, except for the number of shares) |
|||||||
December 31, |
March 31, |
||||||
2019 |
2019 |
||||||
(Unaudited) |
|||||||
ASSETS |
|||||||
Current Assets |
|||||||
Cash and cash equivalents |
$ |
1,173,521 |
$ |
3,967,980 |
|||
Accounts receivable, net, current portion |
2,009,589 |
199,909 |
|||||
Inventories |
1,526,077 |
1,508,244 |
|||||
Finance lease receivables, net, current portion |
428,958 |
10,254 |
|||||
Prepayments, receivables and other assets, net |
4,701,683 |
3,787,254 |
|||||
Escrow receivable due within one year |
- |
600,000 |
|||||
Due from related parties |
107,855 |
140,498 |
|||||
Current assets - discontinued operations |
920,085 |
1,185,016 |
|||||
Total Current Assets |
10,867,768 |
11,399,155 |
|||||
Property and equipment, net |
|||||||
Property and equipment, net |
417,141 |
100,680 |
|||||
Property and equipment, net - discontinued operations |
13,883 |
25,205 |
|||||
Total Property and equipment, net |
431,024 |
125,885 |
|||||
Other Assets |
|||||||
Right-of-use assets |
659,961 |
- |
|||||
Intangible assets, net |
1,372 |
1,627 |
|||||
Prepayment for intangible assets |
750,000 |
280,000 |
|||||
Accounts receivable, noncurrent |
1,090,787 |
- |
|||||
Finance lease receivables, net, noncurrent |
748,249 |
22,298 |
|||||
Other assets of discontinued operations |
161,881 |
485,170 |
|||||
Total Other Assets |
3,412,250 |
789,095 |
|||||
Total Assets |
$ |
14,711,042 |
$ |
12,314,135 |
|||
LIABILITIES AND EQUITY |
|||||||
Current Liabilities |
|||||||
Borrowings from financial institutions |
$ |
211,248 |
$ |
219,157 |
|||
Borrowings from third parties |
- |
476,765 |
|||||
Accounts payable |
55,453 |
- |
|||||
Advance from customers |
60,317 |
31,776 |
|||||
Income tax payable |
26,975 |
21,905 |
|||||
Accrued expenses and other liabilities |
1,482,933 |
962,291 |
|||||
Due to related parties and affiliates |
212,144 |
415,931 |
|||||
Lease liabilities |
209,188 |
- |
|||||
Derivative liabilities |
629,848 |
- |
|||||
Current liabilities of discontinued operations |
4,954,400 |
1,625,779 |
|||||
Total Current Liabilities |
7,842,506 |
3,753,604 |
|||||
Other Liabilities |
|||||||
Borrowings from financial institutions, noncurrent |
41,696 |
177,789 |
|||||
Lease liabilities, noncurrent |
421,109 |
- |
|||||
Total Other Liabilities |
462,805 |
177,789 |
|||||
Total liabilities |
8,305,311 |
3,931,393 |
|||||
Commitments and Contingencies |
|||||||
Stockholders' Equity |
|||||||
Common stock (par value $0.0001 per share, 100,000,000 shares authorized; 28,839,803 and 25,945,255 shares issued and outstanding at December 31, 2019 and March 31, 2019, respectively) |
2,884 |
2,595 |
|||||
Additional paid-in capital |
26,835,804 |
23,833,112 |
|||||
Accumulated deficit |
(19,846,811) |
(15,031,538) |
|||||
Accumulated other comprehensive loss |
(621,957) |
(428,771) |
|||||
Total Senmiao Technology Limited Stockholders' Equity |
6,369,920 |
8,375,398 |
|||||
Noncontrolling interests |
35,811 |
7,344 |
|||||
Total Equity |
6,405,731 |
8,382,742 |
|||||
Total Liabilities and Equity |
$ |
14,711,042 |
$ |
12,314,135 |
|||
SENMIAO TECHNOLOGY LIMITED |
||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
||||||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||||||
For the Three Months Ended |
For the Nine Months Ended |
|||||||||
2019 |
2018 |
2019 |
2018 |
|||||||
(Unaudited) |
(Unaudited) |
(Unaudited) |
(Unaudited) |
|||||||
Revenues |
$ |
2,745,579 |
$ |
118,736 |
$ |
13,643,429 |
$ |
118,736 |
||
Cost of revenues |
(1,901,405) |
- |
(10,632,901) |
- |
||||||
Gross profit |
844,174 |
118,736 |
3,010,528 |
118,736 |
||||||
Operating expenses |
||||||||||
Selling, general and administrative expenses |
(1,339,238) |
(529,913) |
(3,486,410) |
(1,028,314) |
||||||
Total operating expenses |
(1,339,238) |
(529,913) |
(3,486,410) |
(1,028,314) |
||||||
Loss from operations |
(495,064) |
(411,177) |
(475,882) |
(909,578) |
||||||
Other income (expense) |
||||||||||
Other income (expense), net |
(37,636) |
10,785 |
(53,364) |
10,786 |
||||||
Interest expense |
(17,248) |
(6,239) |
(79,593) |
(6,239) |
||||||
Change in fair value of derivative liabilities |
(485,400) |
- |
1,509,406 |
- |
||||||
Total other income, net |
(540,284) |
4,546 |
1,376,449 |
4,547 |
||||||
Income (loss) before income taxes |
(1,035,348) |
(406,631) |
900,567 |
(905,031) |
||||||
Income tax benefits (expenses) |
72,648 |
- |
(32,950) |
- |
||||||
Income (Loss) from continuing operations, net of applicable income taxes |
(962,700) |
(406,631) |
867,617 |
(905,031) |
||||||
Net loss from discontinued operations |
(4,399,236) |
(361,661) |
(5,593,627) |
(1,583,630) |
||||||
Net loss |
(5,361,936) |
(768,292) |
(4,726,010) |
(2,488,661) |
||||||
Less: Net income (loss) attributable to noncontrolling interests from continuing operations |
34,769 |
(3,041) |
(89,264) |
(3,041) |
||||||
Net loss attributable to stockholders |
$ |
(5,327,167) |
$ |
(771,333) |
$ |
(4,815,274) |
$ |
(2,491,702) |
||
Net loss |
$ |
(5,361,936) |
$ |
(768,292) |
$ |
(4,726,010) |
$ |
(2,488,661) |
||
Other comprehensive income (loss) |
||||||||||
Foreign currency translation adjustment |
206,432 |
(26,063) |
(253,983) |
(132,763) |
||||||
Comprehensive loss |
(5,155,504) |
(794,355) |
(4,979,993) |
(2,621,424) |
||||||
Less: Total comprehensive (income) loss attributable to noncontrolling interests |
30,015 |
(3,041) |
28,467 |
- |
||||||
Total comprehensive loss attributable to stockholders |
$ |
(5,185,519) |
$ |
(791,314) |
$ |
(5,008,460) |
$ |
(2,621,424) |
||
Weighted average number of common stock |
||||||||||
Basic and diluted |
28,825,281 |
25,879,400 |
27,733,885 |
25,879,400 |
||||||
Earnings (loss) per share - basic and diluted |
||||||||||
Continuing operations |
$ |
(0.03) |
$ |
(0.02) |
$ |
0.03 |
$ |
(0.04) |
||
Discontinued operations |
$ |
(0.15) |
$ |
(0.01) |
$ |
(0.20) |
$ |
(0.06) |
||
SENMIAO TECHNOLOGY LIMITED |
||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||||
For the Nine Months Ended |
||||||||
2019 |
2018 |
|||||||
(Unaudited) |
(Unaudited) |
|||||||
Cash Flows from Operating Activities: |
||||||||
Net loss |
$ |
(4,726,010) |
$ |
(2,488,661) |
||||
Net loss from discontinued operations |
(5,593,627) |
(1,583,630) |
||||||
Net income (loss) from continuing operations |
867,617 |
(905,031) |
||||||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||||
Depreciation and amortization of property and equipment |
82,672 |
947 |
||||||
Amortization of right-of-use assets |
89,095 |
- |
||||||
Amortization of intangible assets |
197 |
14 |
||||||
Provision for doubtful accounts |
228,249 |
- |
||||||
Loss on disposal of equipment |
4,593 |
- |
||||||
Change in fair value of derivative liabilities |
(1,509,406) |
- |
||||||
Change in operating assets and liabilities |
||||||||
Accounts receivable |
(2,985,722) |
309 |
||||||
Inventories |
(72,278) |
- |
||||||
Prepayments, receivables and other assets |
(1,226,099) |
(280,402) |
||||||
Finance lease receivables |
(1,146,021) |
- |
||||||
Accounts payable |
55,464 |
- |
||||||
Advances from customers |
29,693 |
- |
||||||
Income tax payable |
5,860 |
- |
||||||
Accrued expenses and other liabilities |
548,545 |
(3,179) |
||||||
Lease liabilities |
(80,297) |
- |
||||||
Net cash used in operating activities from continuing operations |
(5,107,838) |
(1,187,342) |
||||||
Net cash used in operating activities from discontinued operations |
(1,896,242) |
(1,273,309) |
||||||
Net Cash Used in Operating Activities |
(7,004,080) |
(2,460,651) |
||||||
Cash Flows from Investing Activities: |
||||||||
Proceeds from sales of equipment |
||||||||
Purchases of property and equipment |
(414,958) |
(688) |
||||||
Prepayment of intangible assets |
(470,000) |
- |
||||||
Net cash used in investing activities from continuing operations |
(884,958) |
(688) |
||||||
Net cash provided by (used in) investing activities from discontinued operations |
1,822 |
(448,575) |
||||||
Net Cash Used in Investing Activities |
(883,136) |
(449,263) |
||||||
Cash Flows from Financing Activities: |
||||||||
Net proceeds from issuance of common stock in registered direct offering |
5,142,124 |
- |
||||||
Net proceeds from issuance of common stock upon warrants exercised |
111 |
- |
||||||
Repayments to stockholders |
(90,000) |
(1,900,000) |
||||||
Repayments to third parties |
(459,635) |
- |
||||||
Repayments from (loans to) related parties |
27,577 |
(1,441) |
||||||
Borrowings from related parties and affiliates |
555,616 |
290,183 |
||||||
Repayments to related parties and affiliates |
(1,554,423) |
- |
||||||
Repayments of current borrowings from financial institutions |
(129,698) |
- |
||||||
Repayments of noncurrent borrowings from financial institutions |
- |
(16,929) |
||||||
Release of escrow receivable |
600,000 |
600,000 |
||||||
Cash acquired from acquisition |
213,644 |
|||||||
Net cash provided by (used in) financing activities from continuing operations |
4,091,672 |
(814,543) |
||||||
Net cash provided by financing activities from discontinued operations |
154,103 |
1,974,617 |
||||||
Net Cash Provided by Financing Activities |
4,245,775 |
1,160,074 |
||||||
Effect of exchange rate changes on cash and cash equivalents |
(196,028) |
(100,007) |
||||||
Net decrease in cash and cash equivalents |
(3,837,469) |
(1,849,847) |
||||||
Cash and cash equivalents, beginning of period |
5,020,510 |
11,141,566 |
||||||
Cash and cash equivalents, end of period |
1,183,041 |
9,291,719 |
||||||
Less: Cash and cash equivalents from discontinued operations |
(9,520) |
(1,839,722) |
||||||
Cash and cash equivalents from continuing operations, end period |
$ |
1,173,521 |
$ |
7,451,997 |
||||
Supplemental Cash Flow Information |
||||||||
Cash paid for interest expense |
$ |
79,593 |
$ |
6,239 |
||||
Cash paid for income tax |
$ |
- |
$ |
- |
||||
Non-cash Transaction in Investing and Financing Activities |
||||||||
IPO expenses paid by the Company's stockholders |
$ |
- |
$ |
70,687 |
||||
Right-of-use assets obtained in exchange of operating lease liabilities |
$ |
957,472 |
$ |
- |
||||
Allocation of fair value of derivative liabilities for issuance of common stock proceeds |
$ |
3,150,006 |
$ |
- |
||||
Allocation of fair value of derivative liabilities to additional paid in capital upon warrants exercised |
$ |
1,010,752 |
$ |
- |
||||
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