Greenland Technologies Holding Corporation (NASDAQ: GTEC) (“Greenland” or the “Company”), a technology developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machineries and vehicles, today announced its unaudited financial results for the second quarter ended June 30, 2021.
Second Quarter 2021 Financial and Operating Highlights
- Total revenues were $28.2 million, an increase of 70.1% from $16.6 million in the second quarter of 2020.
- Gross margin was 20.2%, an increase of 2.8 percentage points year over year.
- Net Income was $3.2 million, an increase of 114.2% from $1.5 million in the second quarter of 2020.
- Number of transmission products sold was 42,046 units, an increase of 48.5% compared with 28,305 units in the second quarter of 2020
CEO and CFO Remarks
Mr. Raymond Wang, CEO of Greenland Technologies Holding Corporation, commented, “We have once again achieved a record quarter with revenue generated of $28.2 million representing a 70% revenue growth and 42,046 transmissions sold representing a 49% increase on a year over year basis. We are benefitting from strong demand as forklifts are the ultimate necessity for clients moving raw materials, components, and finished goods through a global supply chain to meet accelerating growth.”
Mr. Wang continued, “Our team continues to do an excellent job supporting the growing markets with operational excellence and innovative solutions. Our latest electric GEF-series lithium powered forklifts offer all the competitive advantages of lithium, with longer battery life and reduced maintenance costs, as compared to traditional lead acid and propane forklifts. With deliveries starting by September in the North America market we expect this to be additive to second half of 2021 revenue and our longer-term results. This line will be promptly followed by our industry disruptive GEL-1800, an all electric 1.8T rated front loader, and GEX-8000, an all electric 8.0T rated load excavator. We are pleased with our progress to date, but even more excited about Greenland’s future, as we expand our global business and build shareholder value.”
Mr. Jing Jin, Greenland Technologies’ Chief Financial Officer commented: “In the first half of 2021, we generated a total revenue of $52.8 million and net income of $5.6 million, doubling the revenue and tripling net income from the previous year. Our gross margin was 20.2% in the second quarter of 2021, an increase of 280 basis points from the second quarter of last year. These strong financial results demonstrate our market leading position to satisfy growing demands for high quality transmission products and our ability to navigate supply chain challenges. In June, we successfully raised $7 million for the strategic execution of new electric vehicle products launched in the U.S. With strong cash flow and a track record for delivering excellent revenue results, we are well positioned to lead in commercial vehicle electrification.”
Recent Developments and Strategic Highlights:
- Debut of New GEF-Series Electric Lithium Forklifts
In July 2021, Greenland launched its brand new GEF-series EV forklifts, one of the industry’s first lithium-powered EV forklift trucks. The GEF-series is designed with variously rated load capabilities and suited for a wide spectrum of applications, including logistics, warehousing, manufacturing, etc. Deliveries of this innovative series will commence in September 2021 in the North American market.
- Completion of $7 Million Underwritten Public Offering
In June 2021, Greenland closed the public offering of 857,844 ordinary shares and raised $7 million for strategic execution in operations
- Forming Major Strategic Partnership with Shandong Zhongcha Heavy Industry Machinery
In June 2021, Greenland entered a major strategic partnership with Shandong Zhongcha Heavy Industry Machinery Co. (“Shandong“), a multinational heavy machinery and automotive manufacturing company, to boost revenue and strengthen leadership position as a first mover.
The companies will jointly launch a lithium-powered forklift, which features Greenland’s new integrated drivetrain system and will be available for sale in the U.S. by Greenland. They will also combine R&D resources to develop the next stage of lithium-powered forklifts to ensure market leadership for both maintains in the long term.
- Launch of EV Pre-booking Service
On June 15, 2021, Greenland announced the launch of an online EV pre-booking service for its new GEL-1800 1.8-ton electric loader and its GEX-8000 electric excavator. Deliveries of the two electric industrial vehicle models are expected to start in the fourth quarter of 2021. Customers can reserve an industrial EV with a $250 refundable deposit.
- Showcasing Greenland’s First Electric Industrial Vehicle at Hannover Messe 2021 Digital Expo
In April 2021, Greenland showcased its new GEL-1800 1.8-ton electric loader at the Hannover Messe 2021 Digital Expo from April 12-16 to allow attendees to have a first look at the sleek design and production specifications of the Company’s first industrial EV. The vehicle is designed for a wide range of applications, including construction, mining, farming, industrial, etc.
Second Quarter 2021 Financial Results
Total revenues were $28.2 million, an increase of approximately 70.1% year-over-year. The increase was primarily due to the significant increase in our sales volume resulting from the continuously growing market demand and the ability to boost supplies while some peers met challenges in handling material shortage and were unable to deliver. The number of transmission products sold increased 48.5% to 42,046 units from 28,305 units in the second quarter of 2020.
Costs of Goods Sold
Costs of goods sold were $22.5 million, an increase of 64.3% from $13.7 million in the second quarter of 2020. The increase was primarily due to the increase in sales volume and the increase in raw material prices.
Gross profit was $5.7 million, an increase of 98.0% from $2.9 million in the second quarter of 2020.
Gross margin was 20.2%, up 2.8 percentage points from 17.4% in the second quarter of 2020. The increase was primarily due to a shift in the product mix towards the higher value and more sophisticated products such as hydraulic transmission products.
Total operating expenses were $2.3 million, up 84.1% from $1.2 million in the second quarter of 2020. Operating expense as a percentage of total revenues was 8.0%, an increase of 0.6 percentage points compared to 7.4% in the second quarter of 2020. The increase in operating expenses was primarily due to the increase in sales and labor costs year-over-year.
- Selling expenses were $0.50 million, an increase of 62.7% from $0.30 million in the second quarter of 2020. The increase was mainly due to the increase in the unit price of transportation expenses.
- General and administration expenses were $0.75 million, an increase of 69.6% from $0.44 million in the second quarter of 2020. The increase was primarily due to the expiration of the Chinese government’s policy related to the Covid-19 relief.
- Research and development expenses were $1.0 million, an increase of 111.4% from $0.48 million in the second quarter of 2020. The increase was mainly due to the increase in the R&D investment in higher value and more sophisticated products and electrification products.
Income from operations
Income from operations was $3.5 million, an increase of 108.2% from $1.7 million in the second quarter of 2020.
Net Income was $3.2 million, an increase of 114.2% from $1.5 million in the second quarter of 2020.
Earnings per share
Basic and diluted net income per ordinary share was $0.26, an increase of 100.0% from $0.13 in second quarter of 2020.
For the full year of 2021, the Company expects total revenues to be between $90 million to $100 million, as compared to the previous guidance range of $80 million to $90 million. The new revenue guidance range represents an increase of approximately 35% to 49% year over year from 2020.
The above outlook is based on information available as of the date of this press release and reflects the Company’s current and preliminary expectations regarding its business situation and market conditions. The outlook is subject to change, especially considering the uncertainties which may result from how the COVID-19 pandemic develops globally.
The Greenland Technologies Holding Corporation management team will host an earnings conference call at 8:00 AM on Tuesday, August 10, 2021, U.S. Eastern Time (8:00 PM on August 10, 2021, Beijing/Hong Kong Time).
Please register in advance for the conference using the link below and dial in 10 minutes before the conference is scheduled to begin. Conference access information will be provided upon registration.
Online Participant Registration: http://apac.directeventreg.com/registration/event/2837618
A replay of the conference call may be accessed by phone at the following numbers until August 18, 2021. To access the replay, please reference the conference ID 2837618.
+61 2 8199-0299
+1 (855) 452-5696
A live and archived webcast of the conference call will be available at https://ir.gtec-tech.com/.
About Greenland Technologies Holding Corporation
Greenland Technologies Holding Corporation (NASDAQ: GTEC) is a developer and a manufacturer of drivetrain systems for material handling machineries and electric vehicles, as well as electric industrial vehicles. For more information visit https://ir.gtec-tech.com/.