This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
TheStreet Open House

ZAP Jonway Announces Its First Quarter 2011 Consolidated Results Following Completion Of The Acquisition Of 51% Of Jonway Automobile

Stocks in this article: ZAAP

ZAP Jonway (OTCBB:ZAAP) recently filed its Form 10-Q for the quarterly period ended March 31, 2011, which included consolidated financial results for the first time taking into account ZAP’s acquisition of 51% of the equity shares of Zhejiang Jonway Automobile Co. Ltd., or Jonway Automobile, located in Sanmen, Zhejiang, China, in January 2011. We refer to this transaction as the Jonway Acquisition. The Jonway Acquisition was the result of a yearlong effort by both parties. Jonway Automobile is an ISO 9000 production-ready automobile manufacturer in China with facilities that were installed in 2009. Through the Jonway Acquisition, ZAP has been able to gain access to a cost-competitive production team in China with manufacturing expertise and access to China’s growing electric vehicle, or EV, market. This complementary relationship is further enhanced by ZAP’s EV technology and expertise, which adds to Jonway Automobile’s existing traditional vehicle sales business and broadens its global sales footprint.

In the quarter ended March 31, 2011, consolidated net sales were US$11.7 million and consolidated net loss was US$9.9 million for the same period. By comparison, in the quarter ended March 31, 2010, net sales were US$848,000 and net loss was US$3.24 million for the same period. The increase in net sales and net loss in the quarter ended March 31, 2011 was primarily related to the Jonway Acquisition which was completed in January 2011 and the inclusion of results of operations of Jonway attributed to ZAP following the closing of the transaction.

In the quarter ended March 31, 2011, consolidated net loss included approximately US$6 million in losses attributed to ZAP, of which more than half were non-cash and a significant portion of the non-cash losses were related to the Jonway Acquisition. In addition, consolidated net loss included US$3.3 million in losses due to a one-time charge of various acquisition price adjustments. Of the non-cash losses from ZAP, approximately US$1.5 million were expenses related to stock-based compensation, amortization of distribution rights and management fees related to the Jonway Acquisition, and a non-cash charge of US$1.8 million for interest expenses related to the discounted price of the US$19 million convertible note issued by ZAP in connection with funding used to complete the Jonway Acquisition. Non-recurring expenses for the quarter included a one-time cash payment of US$650,000 in legal and audit fees in connection with the Jonway Acquisition.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Jim Cramer and Stephanie Link reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

Jim Cramer's protégé, David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
Try it NOW
Try it NOW
Try it NOW

Check Out Our Best Services for Investors

Dividend Stock Advisor

Jim Cramer's protégé, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Options Profits

Our options trading pros provide over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • Actionable options commentary and news
  • Real-time trading community
Try it NOW
Try it NOW
Try it NOW
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,430.20 +42.99 0.25%
S&P 500 2,029.65 +0.10 0.00%
NASDAQ 4,692.1550 +10.6580 0.23%

Partners Compare Online Brokers

Free Reports

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs