Senmiao Technology Reports Fiscal 2022 First Quarter Financial Results
CHENGDU, China, Aug. 16, 2021 /PRNewswire/ -- Senmiao Technology Limited ("Senmiao") (NASDAQ: AIHS), a provider of automobile transaction and related services targeting the online ride-hailing industry in China as well as an operator of its own online ride-hailing platform, today announced financial results for its fiscal 2022 first quarter ended June 30, 2021.
Fiscal 2022 First Quarter Financial and Operating Highlights
- Total revenues of $1.9 million, an increase of approximately 61% from $1.1 million in the prior-year period, primarily as a result of increased operating lease revenues from automobile rentals as Senmiao has shifted its focus to this business in direct response to the COVID-19 pandemic.
- Net loss from continuing operations of $7.4 million, compared with $2.3 million from the prior-year period, primarily due to increased cost of revenue, operating expenses and other expense related to the development and services provided on Senmiao's new online ride-hailing platform.
- From October 23, 2020, the date Senmiao launched its online ride-hailing platform, to June 30, 2021, 10.5 million rides were completed through the platform with fares paid by riders totaling $31.4 million.
Management Commentary
Xi Wen, Chairman, Chief Executive Officer and President of Senmiao, stated, "Our online ride-hailing platform continued to ramp its growth since its launch in last October. We achieved 61% growth on the top line during the fiscal 2022 first quarter, primarily driven by increased operating lease revenues from automobile rentals, which accounted for the majority of our total revenues. During the period, we were pleased to see the public health situation continue to improve in a post-pandemic recovery. We anticipate operating lease revenues from automobile rentals will continue to account for most of our revenues with our online ride-hailing platform services making steady contributions over the next 12 months."
Mr. Wen continued, "We feel there is a natural symmetry where Senmiao can leverage our online ride-hailing platform and improve utilization of automobiles under our operating leases. This year, we launched the platform in Guangzhou, China's third-largest city, in late March, as well as in the smaller cities of Nanchong and Panzhihua in June. As a result of our expansions into new cities and valued partnerships, approximately 6 million rides have been completed using Senmiao's platform, generating gross fares of approximately $18 million, during the three months ended June 30, 2021."
"We remain confident in the long-term prospects of the online ride-hailing industry despite some setbacks caused by recent COVID-19 resurgences in Guangzhou and Chengdu, which resulted in local governments implementing travel restrictions and lockdowns. We continue to deepen our relationships with our key industry partners and anticipate further expansion into more cities in China this year. We believe the acceleration of our platform's growth will benefit the automobile rentals business as more individuals look to transition into ride-hailing as a profession. We look forward to supporting a growing population of ride-hailing drivers as the industry continues to expand across the country."
Financial Review
Revenues
Total revenues were $1.9 million for the fiscal first quarter ended June 30, 2021, an increase of 61% from $1.1 million in the prior-year period. The increase was largely due to increased operating lease revenues from Senmiao's automobile rental business, which was partially offset by lack of revenue contributions from automobile sales and facilitation of automobile transaction and financing during the period.
Cost of Revenues
Cost of revenues increased to $3.8 million for the fiscal first quarter ended June 30, 2021, compared to $0.8 million in the prior fiscal year, primarily due to a $1.4 million increase in cost of automobiles under operating leases and a $1.9 million increase in direct expense and technical service fees related to Senmiao's online ride-hailing platform, as a result of the commencement and expansion of those two businesses.
Gross Profit (Loss)
Gross loss was $1.9 million for the fiscal first quarter ended June 30, 2021, compared to gross profit of $0.3 million in the prior-year period, due to the decreased number of automobiles sold and facilitated new automobile purchases. Senmiao has focused on operating leases to mitigate the impact of the return of automobiles by a substantial number of drivers and the intense competition in the online ride-hailing market in Chengdu and Changsha since 2020. As noted above, Senmiao incurred increased cost of revenues related to the launch of its online ride-hailing platform. It also paid additional cash incentives to attract drivers to its platform.
Selling, General and Administrative Expenses
Selling, general and administrative expenses increased to $3.7 million for the fiscal first quarter ended June 30, 2021, compared to $2.0 million in the prior-year period. The increase was mainly attributable to a $0.7 million increase in salary and employee benefits as Senmiao's employee headcount increased from 179 to 347, a $0.8 million increase in advertising and promotion expenses for online ride-hailing platform services, and a $0.4 million increase for office expenses, professional service fees such as financial, legal and market consulting, and other miscellaneous expenses, partially offset by a $0.3 million decrease in amortization of automobiles that were rendered to Senmiao but have not been sub-leased as Senmiao leased more automobiles during this quarter than in the prior-year period.
Net Loss
Net loss from Senmiao's continuing operations for the fiscal first quarter ended June 30, 2021, was $7.4 million, compared to $2.3 million in the prior-year period, which was primarily the result of the increased cost of revenues and increased selling, general and administrative expenses mentioned above, as well as a $1.1 million decrease in change in fair value of derivative liabilities related to warrants issued in Senmiao's most recent registered direct offering.
Loss per Share
Loss per share for continuing operations was approximately $0.12 based on a weighted average number of basic and diluted common stock of 52.7 million, compared to approximately $0.07 based on a weighted average number of basic and diluted common stock of 29.0 million.
Financial Position
As of June 30, 2021, Senmiao had cash and cash equivalents of $4.0 million, compared to $4.4 million as of March 31, 2021. The Company's business is capital intensive, and management is taking steps to alleviate the working capital deficit.
Further information regarding Senmiao's results of operations for the quarter ended June 30, 2021 can be found in Senmiao's website, which will be filed with the Securities and Exchange Commission.
About Senmiao Technology Limited
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, operating lease, guarantee and other automobile transaction services as well as operates its own ride-hailing platform aimed principally at the growing online ride-hailing market in Senmiao's areas of operation in China. For more information about Senmiao, please visit: http://www.senmiaotech.com. The Company routinely provides important information on its website.
Cautionary Note Regarding Forward-Looking Statements
This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements (including statements concerning the development of Senmiao's automobile transaction, financing, rental and related services and online ride-hailing platform, the Chinese ride-hailing and automobile financial leasing markets, Senmiao's plans, objectives, goals, strategies, and performance, and the impact of COVID-19 on Senmiao's business), as well as the assumptions such statements and other statements that are not statements of historical facts are subject to significant risks, uncertainties and assumptions, including those detailed from time to time in the Senmiao's filings with the SEC, and represent Senmiao's views only as of the date they are made and should not be relied upon as representing Senmiao's views as of any subsequent date. 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: [email protected]
Phone: +86 28 6155 4399
Investor Relations:
The Equity Group Inc.
Adam Prior, Senior Vice President
(212) 836-9606
[email protected]
In China
Lucy Ma, Associate
+86 10 5661 7012
[email protected]
© 2021 Senmiao Technology Ltd. All rights reserved.
SENMIAO TECHNOLOGY LIMITED |
||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS |
||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||
June 30, 2021 |
March 31, 2021 |
|||||
(Unaudited) |
||||||
ASSETS |
||||||
Current assets |
||||||
Cash, and cash equivalents |
$ |
4,037,518 |
$ |
4,448,075 |
||
Accounts receivable, net, current portion |
1,284,226 |
1,437,195 |
||||
Inventories |
255,954 |
127,933 |
||||
Finance lease receivables, net, current portion |
501,482 |
541,605 |
||||
Prepayments, other receivables and other assets, net |
4,560,491 |
3,905,278 |
||||
Due from related parties |
38,333 |
39,572 |
||||
Current assets - discontinued operations |
54,255 |
393,348 |
||||
Total current assets |
10,732,259 |
10,893,006 |
||||
Property and equipment, net |
||||||
Property and equipment, net |
5,574,939 |
3,700,147 |
||||
Property and equipment, net - discontinued operations |
— |
5,592 |
||||
Total property and equipment, net |
5,574,939 |
3,705,739 |
||||
Other assets |
||||||
Operating lease right-of-use assets, net |
452,035 |
499,221 |
||||
Operating lease right-of-use assets, net, related parties |
718,804 |
580,367 |
||||
Financing lease right-of-use assets, net |
3,889,841 |
4,778,772 |
||||
Intangible assets, net |
935,122 |
968,131 |
||||
Goodwill |
— |
135,388 |
||||
Accounts receivable, net, noncurrent |
111,591 |
269,183 |
||||
Finance lease receivables, net, noncurrent |
337,885 |
473,472 |
||||
Total other assets |
6,445,278 |
7,704,534 |
||||
Total assets |
$ |
22,752,476 |
$ |
22,303,279 |
||
LIABILITIES AND EQUITY （DEFICIENCY） |
||||||
Current liabilities |
||||||
Borrowings from financial institutions |
$ |
451,742 |
$ |
310,662 |
||
Accounts payable |
184,113 |
44,769 |
||||
Advances from customers |
154,779 |
155,586 |
||||
Income tax payable |
17,666 |
17,408 |
||||
Accrued expenses and other liabilities |
8,704,888 |
6,655,592 |
||||
Due to related parties and affiliates |
485,301 |
352,827 |
||||
Operating lease liabilities |
112,977 |
209,644 |
||||
Operating lease liabilities - related parties |
410,582 |
243,726 |
||||
Financing lease liabilities |
5,195,122 |
5,172,943 |
||||
Derivative liabilities |
6,164,941 |
1,278,926 |
||||
Current liabilities - discontinued operations |
934,524 |
2,336,861 |
||||
Total current liabilities |
22,816,635 |
16,778,944 |
||||
SENMIAO TECHNOLOGY LIMITED |
||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS(CONTINUED) |
||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||
June 30, 2021 |
March 31, 2021 |
|||||
(Unaudited) |
||||||
Other liabilities |
||||||
Borrowings from financial institutions, noncurrent |
40,062 |
44,962 |
||||
Operating lease liabilities, non-current |
249,017 |
263,708 |
||||
Operating lease liabilities, non-current - related parties |
407,296 |
341,549 |
||||
Financing lease liabilities, non-current |
1,734,107 |
2,256,553 |
||||
Deferred tax liability |
45,659 |
44,993 |
||||
Total other liabilities |
2,476,141 |
2,951,765 |
||||
Total liabilities |
25,292,776 |
19,730,709 |
||||
Commitments and contingencies |
||||||
Stockholders' equity (deficiency) |
||||||
Common stock (par value $0.0001 per share, 100,000,000 |
5,536 |
4,978 |
||||
Additional paid-in capital |
43,031,107 |
40,755,327 |
||||
Accumulated deficit |
(40,313,536) |
(34,064,921) |
||||
Accumulated other comprehensive loss |
(845,908) |
(838,671) |
||||
Total Senmiao Technology Limited stockholders' equity |
1,877,199 |
5,856,713 |
||||
Non-controlling interests |
(4,417,499) |
(3,284,143) |
||||
Total equity (deficiency) |
(2,540,300) |
2,572,570 |
||||
Total liabilities and equity (deficiency) |
$ |
22,752,476 |
$ |
22,303,279 |
||
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 |
||||||
June 30, |
||||||
2021 |
2020 |
|||||
(Unaudited) |
(Unaudited) |
|||||
Revenues |
$ |
1,850,075 |
$ |
1,146,916 |
||
Cost of revenues |
(3,779,346) |
(800,256) |
||||
Gross profit (loss) |
(1,929,271) |
346,660 |
||||
Operating expenses |
||||||
Selling, general and administrative expenses |
(3,683,277) |
(1,960,425) |
||||
Provision for doubtful accounts, net of recovery |
(45,553) |
(128,612) |
||||
Impairments of long-lived assets and goodwill |
(164,257) |
— |
||||
Total operating expenses |
(3,893,087) |
(2,089,037) |
||||
Loss from operations |
(5,822,358) |
(1,742,377) |
||||
Other expense |
||||||
Other expense, net |
(56,659) |
(6,076) |
||||
Interest expense |
(14,696) |
(20,648) |
||||
Interest expense on finance leases |
(107,639) |
(226,177) |
||||
Change in fair value of derivative liabilities |
(1,369,284) |
(282,980) |
||||
Total other expense, net |
(1,548,278) |
(535,881) |
||||
Loss before income taxes |
(7,370,636) |
(2,278,258) |
||||
Income tax expense |
— |
(6,272) |
||||
Net loss from continuing operations |
(7,370,636) |
(2,284,530) |
||||
Net loss from discontinued operations, net of applicable income taxes |
— |
(85,654) |
||||
Net loss |
(7,370,636) |
(2,370,184) |
||||
Net loss attributable to non-controlling interests from continuing operations |
1,122,021 |
389,699 |
||||
Net loss attributable to stockholders |
$ |
(6,248,615) |
$ |
(1,980,485) |
||
Net loss |
$ |
(7,370,636) |
$ |
(2,370,184) |
||
Other comprehensive income (loss) |
||||||
Foreign currency translation adjustment |
(18,572) |
11,717 |
||||
Comprehensive loss |
(7,389,208) |
(2,358,467) |
||||
less: Total comprehensive loss attributable to noncontrolling interests |
(1,133,356) |
(387,386) |
||||
Total comprehensive loss attributable to stockholders |
$ |
(6,255,852) |
$ |
(1,971,081) |
||
Weighted average number of common stock |
||||||
Basic and diluted |
52,731,560 |
29,008,818 |
||||
Loss per share – basic and diluted |
||||||
Continuing operations |
$ |
(0.12) |
$ |
(0.07) |
||
Loss per share - |
||||||
Discontinued operations |
$ |
— |
$ |
(0.00) |
||
SENMIAO TECHNOLOGY LIMITED |
||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS |
||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||
For the Three Months Ended |
||||||
June 30, |
||||||
2021 |
2020 |
|||||
(Unaudited) |
(Unaudited) |
|||||
Cash Flows from Operating Activities: |
||||||
Net loss |
$ |
(7,370,636) |
$ |
(2,370,184) |
||
Net loss from discontinued operations |
— |
(85,654) |
||||
Net loss from continuing operations |
(7,370,636) |
(2,284,530) |
||||
Adjustments to reconcile net loss to net cash used in operating activities: |
||||||
Depreciation and amortization of property and equipment |
211,588 |
58,085 |
||||
Amortization of right-of-use assets |
1,182,825 |
880,785 |
||||
Amortization of intangible assets |
37,340 |
20,814 |
||||
Provision for doubtful accounts, net of recovery |
45,553 |
128,612 |
||||
Impairments of long-lived assets and goodwill |
164,257 |
— |
||||
Change in fair value of derivative liabilities |
1,369,284 |
282,980 |
||||
Change in operating assets and liabilities |
||||||
Accounts receivable |
302,036 |
(94,912) |
||||
Inventories |
(126,111) |
(10,647) |
||||
Prepayments, other receivables and other assets |
(1,186,463) |
365,804 |
||||
Finance lease receivables |
190,695 |
(74,350) |
||||
Accounts payable |
843,054 |
3,609 |
||||
Advances from customers |
(3,108) |
42,437 |
||||
Income tax payable |
— |
60 |
||||
Accrued expenses and other liabilities |
1,896,615 |
564,708 |
||||
Operating lease liabilities |
(118,341) |
(81,842) |
||||
Operating lease liabilities - related parties |
33,877 |
(18,502) |
||||
Net cash used in operating activities from continuing operations |
(2,527,535) |
(216,889) |
||||
Net cash (used in) provided by operating activities from discontinued operations |
(1,107,924) |
183,832 |
||||
Net Cash Used in Operating Activities |
(3,635,459) |
(33,057) |
||||
Cash Flows from Investing Activities: |
||||||
Purchases of property and equipment |
(2,072,779) |
(4,891) |
||||
Net cash used in investing activities from continuing operations |
(2,072,779) |
(4,891) |
||||
Net cash used in investing activities from discontinued operations |
(1,395) |
(70) |
||||
Net Cash Used in Investing Activities |
(2,074,174) |
(4,961) |
||||
Cash Flows from Financing Activities: |
||||||
Net proceeds from issuance of common stock and warrants in a registered direct |
5,771,053 |
— |
||||
Net proceeds from issuance of common stock upon warrants exercised |
22,015 |
— |
||||
Borrowings from financial institution |
258,001 |
122,406 |
||||
Loan to related party |
(8,654) |
(19,693) |
||||
Borrowings from related parties and affiliates |
125,493 |
— |
||||
Repayments to related parties and affiliates |
— |
(4,155) |
||||
Repayments of current borrowings from financial institutions |
(127,098) |
(23,739) |
||||
Principal payments of finance lease liabilities |
(718,648) |
(376,670) |
||||
Net cash provided by (used in) financing activities from continuing operations |
5,322,162 |
(301,851) |
||||
Net cash provided by financing activities from discontinued operations |
— |
7,233 |
||||
Net Cash Provided by (Used in) Financing Activities |
5,322,162 |
(294,618) |
||||
SENMIAO TECHNOLOGY LIMITED |
||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS(CONTINUED) |
||||||
(Expressed in U.S. dollar, except for the number of shares) |
||||||
For the Three Months Ended |
||||||
June 30, |
||||||
2021 |
2020 |
|||||
(Unaudited) |
(Unaudited) |
|||||
Effect of exchange rate changes on cash and cash equivalents |
(23,086) |
10,239 |
||||
Net decrease in cash and cash equivalents |
(410,557) |
(322,397) |
||||
Cash and cash equivalents, beginning of period |
4,448,075 |
844,028 |
||||
Cash and cash equivalents, end of period |
4,037,518 |
521,631 |
||||
Less: Cash and cash equivalents from discontinued operations |
— |
(5,033) |
||||
Cash and cash equivalents from continuing operations, end of period |
$ |
4,037,518 |
$ |
516,598 |
||
Supplemental Cash Flow Information |
||||||
Cash paid for interest expense |
$ |
14,696 |
$ |
20,648 |
||
Cash paid for income tax |
$ |
— |
$ |
— |
||
Non-cash Transaction in Investing and Financing Activities |
||||||
Recognition of right-of-use assets and lease liabilities |
$ |
— |
$ |
1,780,027 |
||
Recognition of right-of-use assets and lease liabilities, related parties |
$ |
298,628 |
$ |
— |
||
Acquisition of equipment through prepayment and financing lease receivables offset |
$ |
— |
$ |
85,455 |
||
Allocation of fair value of derivative liabilities for issuance of common stock |
$ |
3,562,404 |
$ |
— |
||
Allocation of fair value of derivative liabilities to additional paid in capital upon |
$ |
45,674 |
$ |
— |
||
SOURCE Senmiao Technology Limited
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