Kaixin Auto Holdings Announces Unaudited First Half 2020 Financial Results Nasdaq:KXIN

BEIJING, Dec. 30, 2020 (GLOBE NEWSWIRE) — Kaixin Auto Holdings (“Kaixin” or the “Firm”) (NASDAQ: KXIN), one of many premium used automotive dealership networks in China, at present introduced its unaudited monetary outcomes for the six months ended June 30, 2020.

First Half of 2020 Operational Highlights

• Gross Merchandise Worth (GMV)¹ was US$34.2 million, representing a lower of 84.5% from US$220.Eight million within the first half of 2019.
• Variety of vehicles offered was 673 items, in contrast with 3,657 items offered within the first half of 2019.
• Stock turnover days had been 98 days, in contrast with 41 days within the first half of 2019.

First Half of 2020 Monetary Highlights

• Complete internet revenues had been US$33.Three million, representing a lower of 83.7% from US$204.6 million within the first half of 2019.
• Gross revenue was US$0.9 million, representing a lower of 89.3% from US$8.6 million within the first half of 2019.
• Loss from operations was US$5.Three million, in contrast with a lack of US$8.Three million within the first half of 2019.
• Web loss attributable to the Firm was US$5.Eight million, in contrast with a internet revenue attributable to the Firm of US$57.Three million within the first half of 2019.
• Adjusted internet loss² (non-GAAP) was US$4.6 million, in contrast with an adjusted internet lack of US$1.7 million within the first half of 2019.
• Adjusted loss from operations² (non-GAAP) was US$4.Zero million, in contrast with an adjusted loss from operations of US$1.6 million within the first half of 2019.
• Adjusted EBITDA³ (non-GAAP) was damaging US$3.9 million, in contrast with an adjusted EBITDA of US$2.Zero thousand within the first half of 2019.

“We’re one of many dealership networks within the premium used automotive section in China. Our technique is to offer customers with the only, most complete and clear companies accessible. The COVID-19 pandemic and the disputes with some non-controlling shareholders of the dealerships had a cloth opposed affect on Kaixin’s used-car dealership enterprise and the Firm has skilled a major lack of revenues within the first half of 2020. We consider our wealthy company sources and a mess of value-added companies would allow us to beat the issue,” commented Mr. Joseph Chen, chairman of Kaixin.

“Going through the dramatic decline of gross sales and gross margin of the used-car dealerships amid the pandemic early this yr, we took immediate cost-cutting initiatives to protect sources and enhance working effectivity. The corporate has been shedding non-essential personnel and discovering methods to scale back company overheads. The associated fee reducing effort leads to important enchancment in working effectivity. Going ahead, we’ll proceed to refine our enterprise and working mannequin, and discover new partnerships and development alternatives,” added Mr. Mingjun Lin, performing chief govt officer of Kaixin.

Ms. Lucy Yang, chief monetary officer of Kaixin, mentioned, “Our first half 2020 income was US$33.Three million, a decline of 83.7% in contrast with the identical interval final yr. As we implement numerous price reducing initiatives, I’m glad to see that whole working bills has declined to US$6.2 million within the first half of 2020 from that of US$16.9 million within the first half of 2019. Our loss from operations was US$5.Three million, in contrast with a loss from operations of US$8.Three million within the first half of 2019.”

First half 2020 Outcomes

Complete internet revenues for the primary half of 2020 had been US$33.Three million, representing an 83.7% lower from the primary half of 2019.

The COVID-19 pandemic had a cloth opposed affect on the Firm’s used-car dealership enterprise.

Value of revenues was US$32.Four million, representing a lower of 83.5% from US$196.Zero million within the first half of 2019. The lower was in step with the lower in revenues.

Gross revenue was US$0.9 million, representing a lower of 89.3% from US$8.6 million within the first half of 2019. Gross revenue margin was 2.8% within the first half of 2020, in contrast with 4.2% within the first half of 2019.

Working bills had been US$6.2 million, a 63.4% lower from US$16.9 million within the first half of 2019. The lower resulted from the trouble to enhance operation effectivity in headcount and personnel-related bills.

Promoting and advertising and marketing bills had been US$1.9 million, a 77.0% lower from US$8.Zero million within the first half of 2019. The lower resulted from the trouble to enhance operation effectivity in headcount and personnel-related bills.

Analysis and improvement bills had been US$0.5 million, a 73.7% lower from US$1.9 million within the first half of 2019. The lower was primarily as a result of lower in headcount and personnel-related bills.

Normal and administrative bills had been US$3.Eight million, a 44.9% lower from US$7.Zero million within the first half of 2019. The lower was primarily as a result of lower in headcount and personnel-related bills.

Loss from operations was US$5.Three million, in contrast with a loss from operations of US$8.Three million within the first half of 2019.

Web loss attributable to the Firm was US$5.Eight million, in contrast with a internet revenue attributable to the Firm of US$57.Three million within the first half of 2019 which included a big accrual of acquire from truthful worth change associated to cooperation agreements with sellers.

Adjusted internet loss (non-GAAP) was US$4.6 million, in contrast with an adjusted internet lack of US$1.7 million within the first half of 2019.

Adjusted loss from operations (non-GAAP) was US$4.Zero million, in contrast with an adjusted loss from operations of US$1.6 million within the first half of 2019.

Adjusted EBITDA (non-GAAP) was damaging US$3.9 million, in contrast with an adjusted EBITDA of US$2.Zero thousand within the first half of 2019.

Enterprise Outlook

Given the intense challenges to its operations, the Firm determined to place a halt to its used-car dealership enterprise operations whereas reexamining its enterprise mannequin, as publicly introduced on August 26, 2020. The administration of the Firm at the moment expects:

• whole revenues for the second half of 2020 to be of a minimal quantity. This forecast displays the Firm’s present and preliminary views available on the market and operational situations, that are topic to alter.

Secure Harbor Assertion

This announcement comprises forward-looking statements. These statements are made below the “secure harbor” provisions of the U.S. Non-public Securities Litigation Reform Act of 1995. These forward-looking statements might be recognized by terminology akin to “will,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” and related statements. Amongst different issues, the enterprise outlook for the second half of 2020 and quotations from administration on this announcement, in addition to Kaixin’s strategic and operational plans, comprise forward-looking statements. Kaixin can also make written or oral forward-looking statements in its filings with the U.S. Securities and Alternate Fee (“SEC”), in its annual report back to shareholders, in press releases and different written supplies and in oral statements made by its officers, administrators or staff to 3rd events. Statements that aren’t historic information, together with statements about Kaixin’s beliefs and expectations, are forward-looking statements. Ahead-looking statements contain inherent dangers and uncertainties. Quite a few components might trigger precise outcomes to vary materially from these contained in any forward-looking assertion, together with however not restricted to the next: our targets and techniques; our future enterprise improvement, monetary situation and outcomes of operations; the anticipated development of the social networking web site market in China; our expectations relating to demand for and market acceptance of our companies; our expectations relating to the retention and strengthening of {our relationships} with used auto dealerships; our plans to reinforce person expertise, infrastructure and repair choices; competitors in our business in China; and related authorities insurance policies and rules referring to our business. Additional data relating to these and different dangers is included in our different paperwork filed with the SEC. All data offered on this press launch and within the attachments is as of the date of this press launch, and Kaixin doesn’t undertake any obligation to replace any forward-looking assertion, besides as required below relevant regulation.

About Non-GAAP Monetary Measures

To complement Kaixin’s consolidated monetary outcomes introduced in accordance with United States Typically Accepted Accounting Ideas (“GAAP”), Kaixin makes use of “adjusted loss from operations”, “adjusted internet loss” and “adjusted EBITDA”, that are outlined as non-GAAP monetary measures by the SEC, in evaluating its enterprise. We outline adjusted loss from operations as loss from operations excluding share-based compensation bills, provision for financing receivable, provision for PPE, one-time provision for different receivable and one-time itemizing payment and adjusted internet loss as internet revenue (loss) excluding share-based compensation bills, truthful worth change of contingent consideration, provision for financing receivable, provision for PPE, one-time provision for different receivable and one-time itemizing payment. Adjusted EBITDA is outlined as internet revenue (loss) excluding truthful worth change of contingent consideration, share-based compensation expense, curiosity bills, revenue tax bills, depreciation, provision for financing receivable, provision for PPE, one-time provision for different receivable and one-time itemizing payment. Kaixin repeatedly and periodically critiques the working outcomes and enterprise efficiency from operational views. Ranging from the primary quarter of 2018, there was a major affect on internet revenue (loss) as a result of materials and important noncash quantity of truthful worth change of contingent consideration referring to the used auto dealerships of the rising used auto enterprise. As a result of nature of the enterprise, Kaixin believes that together with adjusted revenue (loss) from operations and excluding the affect of such truthful worth modifications extra appropriately displays Kaixin’s outcomes of operations, and offers traders with a greater understanding of Kaixin’s enterprise efficiency. To facilitate traders and analysts, we current the foresaid affect in “Reconciliation of non-GAAP outcomes of operations measures to the comparable GAAP monetary measures” retrospectively. We current adjusted revenue (loss) from operations, internet revenue (loss) and EBITDA as a result of they’re utilized by our administration to judge our working efficiency. We additionally consider that these non-GAAP monetary measures present helpful data to traders and others in understanding and evaluating our consolidated outcomes of operations in the identical method as our administration and in evaluating monetary outcomes throughout accounting durations and to these of our peer firms.

These non-GAAP monetary measures usually are not meant to be thought-about in isolation from, or as an alternative to, the monetary data ready and introduced in accordance with GAAP. For extra data on these non-GAAP monetary measures, please see the desk captioned “Reconciliation of non-GAAP outcomes of operations measures to the comparable GAAP monetary measures” on the finish of this launch.

For extra data, please contact:

Kaixin Auto Holdings

Investor Relations
Electronic mail: ir@kaixin.com

_________________

¹Contains car gross sales transactions on the Firm’s dealerships together with vehicles owned by Kaixin and vehicles sourced by Kaixin Affiliated Community Sellers that Kaixin sells pursuant to profit-sharing preparations.

²Adjusted loss from operations and adjusted internet loss are non-GAAP measures. We outline adjusted loss from operations as loss from operations excluding share-based compensation bills, provision for financing receivable, provision for PPE, one-time provision for different receivable and one-time itemizing payment. We outline adjusted internet loss as internet (loss) revenue excluding truthful worth change of contingent consideration, share-based compensation bills, provision for financing receivable, provision for PPE, one-time provision for different receivable, and one-time itemizing payment. See “About Non-GAAP Monetary Measures” under.

³Adjusted EBITDA is a non-GAAP monetary measure. It’s outlined as internet (loss) revenue excluding truthful worth change of contingent consideration, share-based compensation expense, curiosity bills, revenue tax bills, depreciation, provision for financing receivable, provision for PPE, one-time provision for different receivable and one-time itemizing payment. See “About Non-GAAP Monetary Measures” under.

KAIXIN AUTO HOLDINGS
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(In hundreds of US {dollars})
		December 31,				June 30,
		2019				2020
ASSETS
Present belongings:
Money and money equivalents	$	3,190			$	1,040
Accounts receivable, internet		219				247
Pay as you go bills and different present belongings		27,586				30,565
Stock		20,990				17,536
Complete present belongings		51,985				49,388
Non-current belongings:
Property and gear, internet		153				110
Proper-of-use lease belongings		2,252				1,700
Complete non-current belongings		2,405				1,810
TOTAL ASSETS	$	54,390			$	51,198
LIABILITIES AND EQUITY
Present liabilities:
Accounts payable	$	4,122			$	1,072
Brief-term debt		16,630				15,213
Accrued bills and different present liabilities		17,302				17,525
Brief-term lease liabilities		1,785				2,216
Quantities on account of associated events		4,214				2,614
Advance from clients		1,677				4,946
Earnings tax payable		5,319				5,251
Complete present liabilities		51,049				48,837
Non-current liabilities:
Lengthy-term lease liabilities		810				322
Complete non-current liabilities		810				322
TOTAL LIABILITIES	$	51,859			$	49,159
Shareholders’ Fairness:
Peculiar shares		5				6
Extra paid-in capital		186,450				191,894
Statutory reserves		4,004				4,004
Gathered deficit		(192,189	)			(197,967	)
Gathered different complete revenue (loss)		(2,840	)			(2,884	)
Complete Kaixin Auto Holdings shareholders’ fairness		(4,570	)			(4,947	)
Non-controlling curiosity		7,101				6,986
TOTAL EQUITY		2,531				2,039
TOTAL LIABILITIES AND EQUITY	$	54,390			$	51,198

KAIXIN AUTO HOLDINGS
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(In hundreds of US {dollars}, besides share and per share knowledge)
	For the Six Months Ended
		June 30,				June 30,
		2019				2020
Web revenues
Vehicle gross sales	$	200,914			$	32,996
Others		3,685				299
Complete internet revenues		204,599				33,295
Value of revenues
Vehicle gross sales		(193,304	)			(32,374	)
Provision for financing receivable		(2,594	)			–
Others		(71	)			(1	)
Complete price of revenues		(195,969	)			(32,375	)
Gross revenue		8,630				920
		–				–
Working bills:
Promoting and advertising and marketing		(8,040	)			(1,852	)
Analysis and improvement		(1,916	)			(503	)
Normal and administrative		(6,963	)			(3,837	)
		–				–
Complete working bills		(16,919	)			(6,192	)
		–				–
Loss from operations		(8,289	)			(5,272	)
Different revenue, internet		1,506				84
Honest worth change of contingent consideration		65,594				–
Curiosity revenue		59				5
Curiosity bills		(1,034	)			(607	)
Complete non-operating revenue (loss)		66,125				(518	)
Earnings (loss) earlier than provision of revenue tax and noncontrolling curiosity, internet of tax		57,836				(5,790	)
Earnings tax bills		(628	)			–
		–				–
Web revenue (loss)		57,208				(5,790	)
Web loss attributable to non-controlling pursuits		101				12
Web revenue (loss) attributable to Kaixin Auto Holdings	$	57,309			$	(5,778	)
Web revenue (loss) per share attributable to Kaixin Auto Holdings shareholders:
Primary	$	1.94			$	(0.10	)
Diluted	$	1.09			$	(0.10	)
Weighted common variety of shares utilized in calculating internet (loss) revenue per abnormal share attributable to Kaixin Auto Holdings shareholders:
Primary		29,609,923				59,649,464
Diluted		52,809,497				59,649,464

Reconciliation of Non-GAAP outcomes of operations measures to the comparable GAAP monetary measures
(In hundreds of US {dollars})
	For the Six Months Ended
		June 30,				June 30,
		2019				2020
Loss from operations	$	(8,289	)		$	(5,272	)
Add again: Shared-based compensation bills		2,510				1,232
Add again: Provision for financing receivable		2,594				–
Add again: Provision for PPE		507				–
Add again: One-time provision for different receivable		150				–
Add again: One-time itemizing payment		905				–
Adjusted loss from operations	$	(1,623	)		$	(4,040	)
Web revenue (loss)	$	57,208			$	(5,790	)
Add again: Honest worth change of contingent consideration		(65,594	)			–
Add again: Shared-based compensation bills		2,510				1,232
Add again: Provision for financing receivable		2,594				–
Add again: Provision for PPE		507				–
Add again: One-time provision for different receivable		150				–
Add again: One-time itemizing payment		905				–
Adjusted internet loss	$	(1,720	)		$	(4,558	)
Web revenue (loss)	$	57,208			$	(5,790	)
Add again: Honest worth change of contingent consideration		(65,594	)			–
Add again: Shared-based compensation bills		2,510				1,232
Add again: Provision for financing receivable		2,594				–
Add again: Provision for PPE		507				–
Add again: One-time provision for different receivable		150				–
Add again: One-time itemizing payment		905				–
Add again: Curiosity bills		975				602
Add again: Earnings tax bills		628				–
Add again: Depreciation		119				41
Adjusted EBITDA	$	2			$	(3,915	)

— to www.globenewswire.com

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