Senmiao Technology Announces Unaudited Financial Results for its Third Fiscal Quarter Ended December 31, 2019
CHENGDU, China, Feb. 14, 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
-- Total revenues increased by 2,212% year-over-year to $2,745,579 from
$118,736
-- Revenue from automobile transaction and related services business
expanded to $13,643,429 in first nine months of fiscal 2020
-- Earnings per share of $0.03 for continuing operations in first nine
months of fiscal 2020 versus loss per share of $0.04 in the same period
last year
"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
December 31, December 31,
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
December 31,
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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SOURCE Senmiao Technology Limited
