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Phoenix Motor Inc. Announces Second Quarter 2022 Financial and Operational Results

Phoenix Motor Inc. (Nasdaq: PEV) (“Company” or “Phoenix”), a leader in manufacturing of all-electric, medium-duty vehicles, today announced its financial results for the second quarter ended June 30, 2022.

Financial Highlights Second Quarter

  • Revenue totaled $1.5 million for the second quarter, an increase of approximately 130% compared to the prior-year period of $653,000, primarily driven by sales of electric forklifts
  • Gross profit increased to $325,000 in the second quarter, compared to a loss of $159,000 in the second quarter of 2021, with gross margin improvement to 21.7% from (24.3%), primarily driven by higher margin electric forklift sales
  • Net losses decreased to $1.9 million in the second quarter, an improvement of more than 16% compared to a loss of $2.3 million in the prior-year period
  • Total assets were $24.6 million as of June 30, 2022
  • Cash and cash equivalents were $7.8 million as of June 30, 2022

Financial Highlights Six Months Ending June 30

  • Revenues for the six months ended June 30, 2022 were $2.2 million representing an increase of 93%, year-over-year
  • Gross profit increased to $445,000 for the recent six-month period, compared to a loss of $107,000 for the prior-year period
  • EBITDA for the first six months of 2022 was a loss of $3.4 million, about the same as in the first six months of 2021
  • Phoenix had net losses of $4.2 million during the six-month period ending June 30, 2022, which was unchanged compared to the prior-year period

Q2 Highlights

  • Raised aggregate gross proceeds of $15.75 million from the Phoenix IPO on June 8, 2022
  • Backlog for vehicles and electric drive systems increased 40% to 88 units compared to the first quarter of 2022
  • Initiated strategic partnership with IAT Automotive Technology as part of next generation product development

“We are excited to have completed our initial public offering in the second quarter, while accomplishing strong revenue growth as we continue to build and reshape the company,” Phoenix CEO, Dr. Lance Zhou commented. “We are busy working not only on our new 4th generation drivetrain but also on exciting new additions to our product offerings in the quarters ahead. We are forging important partnerships with service providers, suppliers and customers. We have been expanding our management team by adding seasoned and establish EV industry veterans. We are taking all of these measures to position Phoenix Motorcars for tremendous growth in the quarters ahead as we capitalize both on our successful past experience, as well as the emerging industry tailwinds supported by recently-passed legislation in the U.S. and elsewhere encouraging this green energy transition.”

Conference Call Information

Phoenix Motor will host a conference call today at 5:00 PM ET to discuss the results. To access the call, participants may dial 1-888-660-6373, international callers may use 1- 929-203-1975, and use conference ID: 3457210.

About Phoenix Motor Inc.

Phoenix Motor Inc., a pioneer in the electric vehicles (“EVs”) industry, through its wholly owned subsidiaries, designs, assembles, and integrates electric drive systems and light and medium duty EVs and markets and sells electric vehicle chargers for the commercial and residential markets. Phoenix operates two primary brands, “Phoenix Motorcars” focused on commercial products including medium duty EVs, chargers and electric forklifts, and “EdisonFuture” which intends to offer light-duty EVs. As an EV pioneer, the Company delivered its first commercial EV in 2014 and deployed the very first zero emission airport shuttle bus at the Los Angeles International Airport (“LAX”); the LAX fleet has grown to 39 electric shuttle buses, one of the largest of its kind. Los Angeles Air Force Base in El Segundo and NASA’s Jet Propulsion Laboratory in Pasadena, California are among customers for the Company’s first-generation E Series Zeus EVs. Phoenix intends to be a leading designer, developer and manufacturer of electric vehicles and electric vehicle technologies. For more information, please visit: www.phoenixmotorcars.com and www.edisonfuture.com.

Forward-Looking Statement

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. When the Company 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 no guarantee of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company’s expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company’s ability to convert concept trucks and vans into production and sales; the Company’s product development timeline and expected start of production; development of competitive trucks and vans manufactured and sold by the Company’s competitors and major industry vehicle companies; the Company’s ability to scale in a cost-effective manner; the Company’s future capital requirements and sources and uses of cash; the Company’s ability to obtain funding for its future operations; the Company’s financial and business performance; changes in the Company’s strategy, future operations, financial position, estimated revenues and losses, projected costs, prospects and plans; the implementation, market acceptance and success of its business model; expectations regarding the Company’s ability to obtain and maintain intellectual property protection and not infringe on the rights of others; and other risks contained in the Offering prospectus and reports filed by the Company with the SEC. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company’s filings with the SEC, including those set forth in the Risk Factors section of the Company's registration statement and Offering prospectus, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.

Phoenix Motor, Inc.

Consolidated Statement of Operations

For the three and six months ended June 30, 2022 and June 30, 2021

(Dollars in thousands, except per share data)

 
Three Months Ended Six Months Ended
June 30, 2022 June 30, 2021 June 30, 2022 June 30, 2021
Revenues $

1,499

 

$

653

 

$

2,170

 

$

1,126

 

Cost of revenues

1,174

 

812

 

1,725

 

1,233

 

Gross profit (loss)

325

 

(159

)

445

 

(107

)

Operating expenses:
Selling, general and administrative

2,290

 

2,142

 

5,313

 

4,099

 

Operating loss

(1,965

)

(2,301

)

(4,868

)

(4,206

)

 
Other income (expense):
Interest expense (income), net

(2

)

1

 

(4

)

2

 

Others

54

 

-

 

639

 

-

 

Total other income, net

52

 

1

 

635

 

2

 

Loss before income taxes

(1,913

)

(2,300

)

(4,233

)

(4,204

)

Income tax provision

(12

)

(1

)

(14

)

(3

)

Net loss $

(1,925

)

$

(2,301

)

$

(4,247

)

$

(4,207

)

 
Net loss per share of common stock:
Basic and Diluted $

(0.11

)

$

(0.13

)

$

(0.24

)

(0.24

)

Weighted average shares outstanding

17,984,615

 

17,500,000

 

17,740,984

 

17,500,000

 

Phoenix Motor, Inc.

Consolidated Balance Sheet

As of June 30, 2022, and December 31, 2021

(Dollars in thousands)

 
June 30, 2022 December 31, 2021
(Unaudited)
Assets
Current assets
Cash and cash equivalents $

7,764

 

$

2,683

 

Accounts receivable, net

1,250

 

1,201

 

Inventories

3,796

 

2,225

 

Prepaid expenses and other current assets

3,741

 

528

 

Total current assets

16,551

 

6,637

 

Restricted cash, non current

250

 

-

 

Property and equipment, net

1,484

 

2,205

 

Intangible assets, net

2,014

 

2,323

 

Goodwill

4,271

 

4,271

 

Total assets $

24,570

 

$

15,436

 

 
Liabilities
Current liabilities
Accounts payable $

2,353

 

$

1,786

 

Accrued liabilities

880

 

779

 

Advance from customers

794

 

803

 

Deferred revenue

487

 

714

 

Warranty reserve

340

 

360

 

Long-term borrowing, current portion

10

 

10

 

Total current liabilities

4,864

 

4,452

 

Long-term borrowings

165

 

756

 

Total liabilities

5,029

 

5,208

 

 
Equity
Common stocks, par $0.0004, 450,000,000 shares authorized,

19,600,000 and 17,500,000 shares issued and outstanding

as of June 30, 2022 and December 31, 2021, respectively*

8

 

7

 

Subscription receivable

-

 

(7

)

Additional paid in capital

39,637

 

26,085

 

Accumulated deficit

(20,104

)

(15,857

)

Total equity

19,541

 

10,228

 

Total liabilities and equity $

24,570

 

$

15,436

 

Phoenix Motor, Inc.

Consolidated Statement of Cash Flows

For the six months ended June 30, 2022 and June 30, 2021

(Dollars in thousands)

 
Six months ended June 30,

2022

 

2021

 

Cash flows from operating activities:
Net loss

(4,247

)

(4,207

)

Adjustments to reconcile net loss to cash used in operating activities:
Depreciation and amortization

855

 

862

 

Gain on disposal of fixed assets

(54

)

-

 

Forgiveness of PPP loan

(586

)

-

 

Stock-based compensation expenses

115

 

45

 

Changes in operating assets and liabilities:
Accounts receivable

(49

)

(235

)

Inventories

(1,607

)

(289

)

Prepaid expenses and other assets

(3,213

)

(2,477

)

Accounts payable

567

 

199

 

Accrued liabilities

101

 

81

 

Warranty reserve

(20

)

(85

)

Deferred revenue

(227

)

(138

)

Advance from customer

(9

)

25

 

Net cash used in operating activities

(8,374

)

(6,219

)

 
Cash flows from investing activities:
Proceeds from disposal of fixed assets

273

 

-

 

Purchase of property, plant and equipment

(8

)

(458

)

Net cash generated from (used in) investing activities

265

 

(458

)

 
Cash flows from financing activities:
Proceeds from borrowings

-

 

586

 

Proceeds from related party

1,676

 

-

 

Repayment to related party

(1,676

)

-

 

Repayment of borrowings

(5

)

(8

)

Proceeds from IPO

13,438

 

-

 

Proceeds from capital injection by a shareholder

7

 

-

 

Net cash generated from financing activities

13,440

 

578

 

 
Increase (Decrease)in cash, cash equivalents and restricted cash

5,331

 

(6,099

)

Cash, cash equivalents and restricted cash at beginning of the period

2,683

 

15,699

 

Cash, cash equivalents and restricted cash at end of the period

8,014

 

9,600

 

 
Reconciliation of cash, cash equivalents, and restricted cash to the consolidated balance sheets
Cash and cash equivalents

7,764

 

9,600

 

Restricted cash

250

 

-

 

Total cash, cash equivalents, and restricted cash

8,014

 

9,600

 

 
Supplemental cash flow information:
Interest paid

-

 

-

 

Income tax paid

3

 

3

 

Non-cash investing activities:
Inventories transferred to property and equipment

36

 

-

 

 

Contacts

Investor Relations Contacts:

Mark Hastings, SVP & Head of Investor Relations

Sioban Hickie, ICR Inc.

PhoenixIR@icrinc.com

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