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Kandi Technologies Reports First Quarter 2013 Financial Results

– Company gained significant sales in UTV growing 677.4% YoY –

– ATV sales Increased 27.5% YoY –

JINHUA, China, May 14, 2013 (GLOBE NEWSWIRE) -- Kandi Technologies Group, Inc. (the 'Company' or 'Kandi') (Nasdaq:KNDI), today reported financial results for the first quarter ended March 31, 2013.

For the three months ended March 31, 2013:

  • Revenues grew 2.1% to $14.67 million from $14.36 million last year;
  • UTV revenues had a significant increase of 677.4% from $74,433 to $578,673, while ATV sales grew 27.5% to $2.55 million in the quarter from $2.00 million a year ago;
  • Operating income rose 5.1% to $1.90 million as gross profits grew 0.9% to $3.37 million compared with $3.34 million in the first quarter of 2012;
  • GAAP net income was $2.24 million, a slight decrease of 6.1% compared with $2.38 million in the 2012 first quarter;
  • EV sold 302 units in the first quarter compared with 296 in the first quarter of 2012;
  • Working capital surplus was $19.94 million at the end of March 31, almost unchanged from the same period last year

Mr. Xiaoming Hu, Chairman and CEO of the Company commented, "The first quarter has been our slowest quarter due to the Chinese New Year Holiday. However, we are still pretty happy about our steady financial results. As we anticipate that 2013 will be Kandi's breakout year, we have successfully started our expansion plan in Shandong and Hainan, as well as enhanced our brand and profile via a joint venture with Geely Auto. We are confident that our efforts will help Kandi's leadership position in the emerging EV market."

"Given our new manufacturing facility in Changxing with full scale production and assembly line, coupled with Geely's experienced operation and marketing team, Kandi will assure its continuous success as China's leading pure EV provider," Mr. Hu concluded.

KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS)
AND COMPREHENSIVE INCOME (LOSS)
(UNAUDITED)
     
  Three Months Ended
  31-Mar-13 31-Mar-12 
REVENUES, NET  $ 14,662,521  $ 14,355,541
     
COST OF GOODS SOLD -11,290,490 -11,014,691
     
GROSS PROFIT 3,372,031 3,340,850
Research and development -689,665 -756,096
Selling and marketing -89,614 -93,835
General and administrative -692,964 -683,620
     
INCOME FROM CONTINUING OPERATIONS 1,899,788 1,807,299
Interest (expense) income, net -670,208 131,602
Change in fair value of financial instruments 990,395 942,950
Government grants -- --
Investment (loss) income -14,023 -13,401
Other income, net 122,365 34,468
     
INCOME (LOSS) BEFORE INCOME TAXES 2,328,317 2,902,918
     
INCOME TAX EXPENSE -91,444 -519,966
     
NET INCOME 2,236,873 2,382,952
     
OTHER COMPREHENSIVE INCOME    
Foreign currency translation 584,915 395,416
     
     
COMPREHENSIVE INCOME (LOSS)  $ 2,821,788  $ 2,778,368
     
WEIGHTED AVERAGE SHARES OUTSTANDING BASIC 32,298,832 27,450,371
     
WEIGHTED AVERAGE SHARES OUTSTANDING DILUTED 32,539,339 28,839,747
     
NET INCOME PER SHARE, BASIC  $ 0.07  $ 0.09
     
NET INCOME PER SHARE, DILUTED  $ 0.07  $ 0.08
 
KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
     
CONDENSED CONSOLIDATED BALANCE SHEETS
     
ASSETS
  March 31, December 31,
  2013 2012
  (Unaudited)  
CURRENT ASSETS    
Cash and cash equivalents  $ 3,987,688  $ 12,135,096
R Restricted cash 7,962,583 15,835,364
Accounts receivable 38,185,652 33,557,534
Inventories (net of reserve for slow moving inventory of $0 and $56,248 as of March 31, 2013 and December 31, 2012 respectively) 10,575,936 7,630,715
Notes receivable 11,556,942 9,562,429
Other receivables 592,408 501,448
Prepayments and prepaid expenses 578,840 563,861
Due from employees 47,467 40,936
Advances to suppliers 2,065,293 4,769,825
Deferred tax 91,897 --
Deposit for acquisition 38,644,613 24,397,967
Total Current Assets 114,289,319 108,995,175
     
LONG-TERM ASSETS    
Plant and equipment, net 33,927,019 35,725,740
Land use rights, net 14,329,219 14,337,691
Construction in progress -- --
Deferred taxes 1,301 695
Investment in associated companies 148,361 161,507
Goodwill 322,591 322,591
Intangible assets 721,067 741,591
Total Long-Term Assets 49,449,558 51,289,815
     
TOTAL ASSETS  $ 163,738,877  $ 160,284,990
     
     
LIABILITIES AND STOCKHOLDERS' EQUITY    
     
  March 31, December 31,
  2013 2012
  (Unaudited)  
CURRENT LIABILITIES    
Accounts payable  $ 10,708,090  $ 8,668,478
Other payables and accrued expenses 3,021,231 3,092,045
Short-term bank loans 32,794,193 32,615,063
Customer deposits 25,470 292,389
Notes payable, net of discount of $0 and $0 as of March 31, 2013 and December 31, 2012 respectively 22,287,315 25,332,088
Income tax payable 258,594 680,253
Due to employees 11,058 7,132
Due to related party 841,251 841,251
Deferred taxes -- 55,166
Financial derivate - liability 449,559 1,513,013
Total Current Liabilities 70,396,761 73,096,878
     
LONG-TERM LIABILITIES    
Bond payable 12,735,609 12,666,044
Financial derivatives - liability   --
Total Long-Term Liabilities 12,735,609 12,666,044
     
TOTAL LIABILITIES 83,132,370 85,762,922
     
     
STOCKHOLDERS' EQUITY    
Common stock, $0.001 par value; 100,000,000 shares authorized; 32,539,867 and 31,696,794 shares issued and outstanding at March 31, 2013 and December 31, 2012, respectively 32,540 31,697
Additional paid-in capital 46,990,026 43,728,218
Retained earnings (the restricted portion is $2,831,005 and $2,831,005 at March 31, 2013 and December 31, 2012, respectively) 27,496,682 25,259,809
Accumulated other comprehensive income 6,087,259 5,502,344
TOTAL STOCKHOLDERS' EQUITY 80,606,507 74,522,068
TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY  $ 163,738,877  $ 160,284,990
 
KANDI TECHNOLOGIES GROUP, INC.
AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
  Three Months Ended March 31
  2013 2012
CASH FLOWS FROM OPERATING ACTIVITIES:    
Net income (loss) $ 2,236,873 $ 2,382,952
Adjustments to reconcile net (loss) income to net cash (used in) provided by operating activities:    
Depreciation and amortization 2,109,977 1,200,884
Deferred taxes -144,911 -24,184
Option expense -- 19,053
Change of derivative instrument's fair value -990,395 -942,950
Loss in investment in associated company 14,023 13,401
     
Changes in operating assets and liabilities:    
(Increase) Decrease In:    
Accounts receivable -4,440,829 -2,626,288
Inventories -2,901,362 -1,470,587
Other receivables and prepaid expenses -88,166 1,121,239
Due from employees -2,418 220,807
Prepayments and prepaid expenses 2,717,021 -1,337,864
     
Increase (Decrease) In:    
Accounts payable  1,990,665 308,069
Other payables and accrued liabilities  -85,177 -2,530,325
Customer deposits -268,344 -998,466
Income tax payable -425,109 365,152
Net cash (used in) provided by operating activities $ -278,152 $ -4,299,107
     
CASH FLOWS FROM INVESTING ACTIVITIES:    
Purchases of plant and equipment -8,698 -16,512
Purchase of construction in progress -- -181,009
Issuance of notes receivable -1,940,690 --
Repayments of notes receivable -- 18,032,672
Deposit for acquisition -14,103,172 --
Net cash provided by (used in) investing activities $ -16,052,560 $ 17,835,151
CASH FLOWS FROM FINANCING ACTIVITIES:    
Restricted cash $ 7,954,409 $ -15,758,880
Proceeds from short-term bank loans 12,727,059 6,297,349
Repayments of short-term bank loans -12,727,059 -6,328,994
Proceeds from notes payable -- 8,686,544
Repayments of notes payable -3,181,765 -3,752,827
Warrant exercise 3,244,318 --
Option exercise& other financing 38,100 40,749
Net cash provided by financing activities 8,055,062 -10,816,059
     
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS -8,275,650 2,719,985
Effect of exchange rate changes on cash 128,242 3,173
Cash and cash equivalents at beginning of period 12,135,096 2,294,352
CASH AND CASH EQUIVALENTS AT END OF PERIOD $ 3,987,688 $ 5,017,510
     
SUPPLEMENTARY CASH FLOW INFORMATION    
Income taxes paid $ 516,554 $ 154,814
Interest paid $ 553,089 $ 648,059
     
SUPPLEMENTAL NON-CASH DISCLOSURE:    
During the three months ended March 31, 2013 and 2012, $0 and $0 were transferred from construction in progress to plant and equipment, respectively. 

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 vehicles. Kandi has established itself as the one of the world's largest manufacturer of pure electric vehicles (EVs), Go-Kart vehicles, and tricycle and utility vehicles (UTVs), among others. More information can be viewed at its corporate website is http://www.kandivehicle.com.

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: Kandi Technologies Group, Inc.
         
         China:
         Email: IR@kandigroup.com
         Phone: 86-579-82239856
         
         U.S.A.:
         Email: IR@kandigroup.com
         Phone: 1-212-551-3610

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