KNDI - Earnings call transcript Q2 2018 | Kandi Technologies Group, Inc.

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Operator

Good day and welcome to the Kandi Technologies’ Second Quarter 2018 Financial Results Call. Today’s conference is being recorded. And at this time, I would like to turn the conference over to Kewa Luo, IR Manager. Please go ahead.

Kewa Luo

Thank you, operator. to call. Group welcome XXXX second and conference earnings everyone, Kandi Inc’s Technologies quarter Hello, distributed earnings website company find The its a you today copy can and on Kandi’s at press www.kandivehicle.com. release earlier are Kandi’s and Mr. With us Founder, today the Chairman CEO, Financial Hu Mr. Xiaoming; Officer, and Chief will Bing session. Mei, by question-and-answer prepared deliver both followed remarks a

Safe call. the going forward-looking the that discussions Private will contain Before I’m the Reform XXXX. Harbor note to we Act get of statement Please Safe made Harbor under Security Litigation the statements review U.S. started, regarding provisions today’s conference of today

involve Forward-looking risks statements inherent and uncertainties.

XX, the XXXX may filed As such, and update the materially Kandi December Annual Exchange Commission. any Report views company’s regarding company’s other documents the results expressed other required U.S. law. as information today. not except risks these and under ended assume on in obligation and differ Further Form the with does any the applicable for included are forward-looking uncertainties from year any to Securities fiscal statements XX-K

a is being reminder, recorded. call this As conference

Xiaoming. audio website. webcast relations be on and will available of Founder, call Mr. conference to this investor Chairman CEO, Hu an turn Kandi’s will Kandi’s over now I addition, the In

Hu Xiaoming

our right its EV and revenue with a our quarter kilometers. to range quarter. [Foreign People’s the production production adjustments has EXX of XXXX its you resumed a joining of and Language] received XXX and normal our the track. XXXX Republic its to has selling Despite driving Technology Kandi’s team we kilometer exceeding and the KXX, to shifted requirements, competitiveness Ministry China, industry. and the products performance, discontinued of KXX in to development a manufacturing the from second product restored management position growth and for Hello, dedicated the sales. KXX, focus Due recent range including Industry The This EV earnings MIIT. believe is regaining Company structure and government sales, our everyone. will of in models stock leading XXX JV call. less kilometers Information in XXX of that EV second market recovery conference approval weak policy Thank the subsidy the Currently, return JV driving the EV than of the with new models Kandi’s Company improving of new or accepted With

would in Thank Afterwards, financial you the I give our call Financial you. our session. Mr. on more answer turn like to the to I Q&A Chief highlights. Officer, Bing Mei details question the will Now, you to

Bing Mei

the Thank hello Hu, everyone you, and to on Mr. call.

Now, I I would that like noted. brief to in quarter the of discuss XXXX. note today numbers overview results of unless financial second the will are Please provide U.S. dollars a our otherwise for all

of quarter the the remarks. was XXXX, XX.X% his XXXX. of quarter $XX.X net XX.X% Hu same a with of were revenue, or decrease decrease compared million due second for or in that million $XX.X results. our quarter sales as sales the quarter the million the revenue second decrease the $XX.X First during financial Total of largely for same you million, second XXXX. EV let in of was walk decrease to the was quarter. through due in from a for The quarter revenue $XX.X decrease EV the largely $XX.X The of stated to Mr. me part part net for total million XX.X% reason

net million XX.X% a the to due same decrease million XXXX. sales. decrease was $X.X quarter in decreased $XX.X quarter, mainly EV net profits this for expenses total million, of million margin to million decrease the as was the of during expenses was period compared the mainly second quarter income this $X.X from R&D from in of $X.X the this XX.X% with period increase XXXX. due parts sold was compared the Gross due to Our decrease decreasing second profit R&D corresponding in an decrease The same Gross Non-GAAP second $XX.X XX.X% to XX.X% the a in in Total quarter Net same primarily from of million to $XX.X second to quarter. XXXX. was XXXX. and in million the in from cost decrease gross expenses vast for in decrease came was loss million The and income in quarter increase of last less in quarter, JV second of in our $XX.X same goods of The from change companies from expense of majority second the the quarter million, of quarter increase XXXX. period the due quarter profit million same compared quarter. period in the of profits, quarter second profitable operating $X.X was compared loss was the was million, in an profits same XXXX. of non-GAAP the R&D to due decreased the Margin of of business mainly of same of $X.X the operating to last of million a year. from quarter companies were in expenses the the $X.X loss year. the as the of to The $XX.X JV the quarter net same from $X.X the in mainly as to

companies’ financials me touch JV now. the on Let

X,XXX loss of sold to was compared $X.X companies sales the to compared quarter same EV quarter of in million, $XX.X net the the increase of XXXX, million, quarter the For net of XXXX. $XX.X of products income There XXXX, in Net an the million in JV were same $XX.X quarter. million second X.X%. were

in in of the have accountable of investments method our the interest we equity as We Company. JV Company are the XX% JV ownership under accounting

of JV $X.X losses, for after-tax recorded As Company’s the profits was the share the XXXX. this XX% was of intra-entity we million quarter. income or for the of second a JV eliminating million $X.X result, of profit quarter After and Company

Company’s the review will I flow. cash Next,

our by cash employee operating includes paid cash received sales This and compensation, of cash offset expense and inflows our primary primary parts from EV interest on the operational inflow expense, suppliers, largely financings. were our off-road to vehicles. cash Our

first same cash in For XXXX, to $X.X of activities million XXXX. used period the compared $X.X half operating as in of was million the

primary investing offset Our our the were cash primarily purchase for business disposition off investments. by roads, include assets six the intangible cash cash improvement. cash and This the acquisitions of assets, construction paid off-roads of received for largely and

last fist by $X.X period of investing XXXX For investing cash activities of provided compared used million year. in to the $X.X activity the same half of as cash million, was for

primary loans cash received bank loan for – and offset the improved payable. from cash proceeds cash of cash bank was This by from note the repayments notes and primary financing largely paid payables. Our improvement

the the of by used cash for first XXXX. $X.X of of of million last financing financing had million half period compared in deficit, year. activities the cash $X.X provided For million XX, capital a We June activities were of XXXX, $X.X to same as as working

from Kandi capital million, increased decrease loan to contribution million the JV by as a working of capital capital, As $XX.X of company’s XX, of the to $XX.X the registered company XXXX. vehicle reflects JV December a which suppress converting it’s

me. $X.X $XX.X XXXX, XX, of we million Thank June XXXX. Q&A as to total of cash compared million and of you. have cash restricted it XX, That As December a from is

Kewa Luo

some Operator, we take questions. can now

Operator

our Tech from Please take question [Operator Instructions] ahead. Fairnow go Investments. first will from Focus We Michael

Michael Fairnow

a stock Michael to I original in not update the to to that further us would I the response. get more so act Yes, did parts, announcement. detail delivery and made announcement some on into surprised distributions forward-looking in can the to recent be the to approved sales the good you expect morning, for going Fairnow. you what actually U.S. break can you U.S. am my get I and If the be am are. three the status Language] going am addressing are on a Initially, U.S. of and distributing I the prototypes, down they expectations question positively when therefore the the cohesive [Foreign we when of like them

Hu Xiaoming

arrived that will the as very you our [Foreign Language] these welcome be based already in we three prototypes And U.S. the have in on evaluation And now EV right U.S. believed

the the the America. Once in I they into the government, by Sportsman EV effort have working U.S. and we soon. very to EVs getting marketing these the in for all thing Sportsman approved the department have Country goes the certified will first subsidiaries, is in Our on it sell the think vehicles U.S. relevant qualifications start

Michael Fairnow

full to U.S. other, actually of then to expect it and Follow-up, start the give some pricing get automobile distribution Chinese of sales indication us when for Tax give sales you talking retail we did tariffs when can will vehicle about to you also are $X,XXX [Foreign U.S. and EXX any us do independent through of distribution on per the to that cars. channels in Sportsman sold credit on expect And be also sales the you Language] the distribution on price far based you or or sales expect Federal as deal and with normal, what how without, you expected EXXX. update can as be

Kewa Luo

Okay. Mr. will Hu I one. answered your go question through them. one by

hundreds for Sportsman the they as event to to in an going the then Dallas. unveiling our of Sportsman into Country to event. representative one And going But on first The have we going is as distributors representative, are invite to XX sell distribution now U.S. that Country is are EVs host the the in

you will contract car. talk to in around can thinking distributors car. probably sale signing we’re there’ll about have want So you be interest XX the the the And

question in receive – EV such $X,XXX as be will out more be eligible heard also eligible second I we’ll will tax Dallas to some And another we credit. receive $X,XXX few find once tax So form our the And to far states credit. is I models, as happens. the as information probably models. buyers understand,

be right exactly the third So to And is But first the know we’re but tax to together this now our in this work, for applying we’re time $XX,XXX. don’t of process how credit. this is we again awfully all legible question, applying And hoping going it’s this. DOT.

the heard team have from DOT So I that receive. to sportsman that is from thing what important we the most is

So the US$XX,XXX. KXX more decided probably right certified once the yet on the but not price clear now that’s we’re are than be terms forward. should of less being we price, to will we going cars smaller going then And in plan

the consumer get as if is US$XX,XXX is than less So to going going credit this cost the US$XX,XXX. tax to

around actually below the other going basically cars are for US$XX,XXX, So we price US$XX,XXX.

tax are believe price get if that again credit, able less than regarding we the the US$XX,XXX. that So the possible US$XX,XXX I question have impact XX% going to a on their reflects this the last are consumers a is consideration already trade actually putting war will car to certain cost But And to car. tariff into tax.

is now. all your outplaying the what I hope basically I that’s So answered questions.

Unidentified Company Representative

Language] less credits will And XX,XXX. the [Foreign the US$XX,XXX if the gets smaller the will consumer the the cars than than UXXA be US$XX,XXX. credit, For less tax price be with

clarify. So to just confirm and want that

Michael Fairnow

To XX,XXX I’m understanding the the car make or sure with be smaller less? would it, credits all

Kewa Luo

Yes.

Michael Fairnow

would $XX,XXX Larger car range, is in credit correct? with that tax the be

Kewa Luo

correct. Yes,

Michael Fairnow

beyond – channels, Language] is that on understand expect a that event clarification to other for at event, dealers just an hosting And correct? distribution auto [Foreign Okay. they hosting channels Sportsman independent distribution of Country, have potential

Hu Xiaoming

[Foreign Language] Yes.

Michael Fairnow

is That correct?

Hu Xiaoming

coming Yes, a going the event. variety distributors to dealers to dealers distributors, that’s of we to That correct. car and car are independent invite and car the

Michael Fairnow

a saying comment was and was had Could kind as well such forward shareholders he chance off ultimately Hu you the pass the as a that an travel which to quite to U.S. and number and just U.S., it’s sale excellent look the be meet could a to his Mr. kicks and just shareholders. potential been know, with [Foreign for the to as Language] follow-up distributors an U.S. time Mr. dealers. been in just to U.S. of has distribution it When time have attend would and some event? And an of event Hu we question,

Hu Xiaoming

to when believe Sportsman’s the schedule I I But don’t I time starts At that [Foreign with the make I to in host selling, team the capable event. plans Language] to will U.S. have future successful shareholders. But to our to have this very our conflicts. meet working will car time, come be come my here.

Michael Fairnow

are ultimately as Mr. distribution, they months? Language] that would six example the [Foreign sales for be If Hu – and may come when an realizing

Hu Xiaoming

with hoping that to going our and come be I’d selling. than to month U.S. our once that Language] Well, to starts I’m love meet car to shareholders. six sooner [Foreign it’s

Michael Fairnow

sure looking the I’m to that forward And you that. Thank all your shareholders for are questions.

Hu Xiaoming

question, [Foreign you. Thank Next Language] please?

Operator

ahead. our And Investor. from Robert a next comes Limpert, Private Please question go

Robert Limpert

Hi, good morning.

my Kandi United has Kandi about question States. coming investors electronic vehicle excited cars parts But parts, I are business. think to all vehicle the to Kandi do with electric

for of specifically parts year, Jinhua that can million second in tell $X [Foreign and question. EVs? us exclusively they acquisition were we And the you Kao An sold So a And have I Language] they Kandi spent Power. last what only then

Hu Xiaoming

Our Language] products well – the are Jinhua to [Foreign we potentially actually haven’t quarter second like as but as JV company so been primary any as batteries the battery are can selling And in selling the third-parties to An Kao supply the and future. Kandi, they technology. pack far to We have well? been

Robert Limpert

And second getting Language] us its give [Foreign Hu license? update is Kandi question my there, Mr. own regarding an

Hu Xiaoming

[Foreign Language] This been already has very thing difficult.

inspection to research qualifications and Jiangsu and made trip and JV of affirmed Commission place Industry XXXX On to together X, Here need is the Reform and the conduct of Kandi group for performed a personnel a highly license. on Department awarding request update. the The also to a of official our relevant a be in fully detailed for the made National management April was special improved. an of the group Development items company product our Rugao of facility has this products to

relating Commission, For who Jiangsu for NDRC the a also problems Jiangsu and other of NDRC notification company to Development is is General Office Guoxin rectification the of Kandi National these the items and notice license. – Jiangsu Reform applying Guoxin issued about

companies companies these So passenger on – relating XX. May built to pure project electric vehicle these two newly

to Kandi request a five to notice rectification Reform serious and the Jiangsu rectification Commission the Provincial accordance rectification report us. so submitted and May And this the made Hence XX on Municipal given the notice, of the to May XX Development with the Development was XX, and organized May In is after need completed. on Reform Kandi Provincial Development Reform a XX, on and and Development Jiangsu Commission Commission Jiangsu On and adjusted. department Commission to June checking. to National Provincial later about be the for reported days again and relevant that Reform the items experts

process, and these passed rectification come final been checking authorization is or XX soon long very But we this the waiting. out. And from and Commission to there the as the also Currently, approval being has and new that the according Reform waiting license NDRC. patiently Development possible. very company from Jiangsu we will be policy understand, So for request the approval Rule Number also heard will we as the the about

approved as difficult However, the more us prior policy our is that even complicated policy. more to very also And very just that government get. approval want heard still it to we license promised and are let will the to be the we license you new we more But hopefully market new get that get to will and our even we hoping we know received And being will be going – soon. I the as frustrated are know soon be letter. to the

Robert Limpert

forward Well, that. to very we’re good like and news that looking all sounds

question. my answering for thanks So

Kewa Luo

Language] question, [Foreign please. you. Next Thank

Operator

Ted And Associates. TAS go Please our next of Schwartz question ahead. comes from

Ted Schwartz

quick couple All ones. right. real got I a

payment would KXX conference around same the million ownership of we’ve X.X on into started and and to That in we XX call on year any into after heard the one the the $XX due went production. March would ago go to who’s week was earlier months an and as be subjects. time. nothing change said Also answer a that XX this production Regarding question March that the KXX

on of did by subjects? we’ve get status fact, government. the In is the particular the KXX approved on than other nothing heard What it these KXX the finally

Kewa Luo

Language] [Foreign

Hu Xiaoming

conducted the has been XX. Language] Inspection model on Authorities. projects first It has Vehicle mandatory product passive inspections The by and passed the Product National [Foreign of function March production prototype in KXX

product Additionally, the have included driving with XXX and kilometer driving kilometer announcement. the range range both EV XXX been in

tax next included exemption directory. expected to sales the be is So it in and the

But market Originally this be the to and/or thought given So KXX production, of until, launching are be grant going government $XX newest million being will will is after thinking we they be start, still government won’t I the will us the that to update million selling. selling. once it verso it that grant approved however, be approved be starting start start that’s so US$XX that card the given.

already a there’s resuming to soon. dragging But I be I we’re dealing now know been we’re in process. they going while. it has So the And government. the think for with

you We have – are called their by rules.

Ted Schwartz

you. be XXXX. Language] to taken subsidy carbon got right, have this program, thank effects he is [Foreign favorable One program be delayed? paying the than All will indicated, generally other, China Hu Kandi Mr. what that articles think in the the Does seeing we in which of more credit

Hu Xiaoming

will Language] for has to credit Kandi In failures. other been and be going carbon and [Foreign receivable manufactures. this my And very helpful opinion on

by the And see changes first be changing policy regulated. adjust like be has year next As as can in this industry and you in will help it repeatedly can affected in has subsidy their half the of finalized now, XXXX order our insert to companies been as to other government year, been sales. the that has

I the finalized are going and to be once So to receivable if believe the the well to regulation, that policies market. the do is company

Ted Schwartz

you right. responses. very the I much. Thank appreciate All

Kewa Luo

Thank you.

Next please. question

Operator

ahead. question comes [indiscernible] And our Please next go from

Unidentified Analyst

the rare there more Shareholders on consumer thank share about than ago new reported conference XX,XXX seem from in an city even heard the be past official EV in cities company were two Hi, The last though year, to much call sales the and the concentrated car hailing. you. last XX discussion have EV. and over more years around count

was kilometers. questions. rental I EV changed in be media many the reaches until ZZY XX it leasing groups two rose paid XX,XXX of Last the would that have year, as now subsidy to speak articles reported several as and However, cities. channel for as subsidy no

EV care then EVs growth car our life of be ZZY future is EVs here still number kilometer Thank so one Kandi’s for is and for subsidies Now only thank cities stopping to those how have is provides far outlook and share Kandi? and answer if share area now for EVs an replaced? still being you, Language] is What requirement share. two used. more Kandi and average major this The question. a expected the for the is the XX,XXX company to which be for the the Kandi What’s the of affecting [Foreign that Is care you. in I first before

Hu Xiaoming

This But five, we’re like question. by going is one I’m altogether. – two answer there’s six Language] These not questions one. sounds [Foreign to you

you was First, can I car company, with companies why other give as will provide In the the future, like service car to you only share EV. cooperate well. share we

Second, for all can be Kandi share used program. EVs car

really type accordingly. will actual the program we it’s share share need So than and car models of based car what provide on – the

in third now the The XX,XXX the, a was would the to receiving past, impact is they manner subsidy – kilometers. in have create policy service company the right and tier not now timely question some has away, they as want XX,XXX the now, subsidies right you get will but change, definitely get in rate right �� subsidy

So this new standards have company and are on service have create this. some delays, the working the manufactures –

run believe affordability one our the tail and range driver basically, EVs of our kilometers. required right cars the and giving question, I do over mileage. gated And which that they So fourth consumers all can XXX now among popular improved cars our the

focusing market selling DCY EVs will in were primary out market more XX the approximately you we’re target base away, And strategy XXXX, is best car fifth XX,XXX market. consumer half about And is on. in of cities. the now will consumer that, business involved the second our be question operating the and share be our in secondary So

around was but XX consolidated. cities, has been Before cities the the some number

XXX,XXX is long question, now right or the haven’t the that now vehicle periodically So cities. life years had electric of but for eight And XX about the the kilometers. kilometer, XXX,XXX as has been hasn’t average vehicle next right given since we for vehicle or

to on based So determine time is yet be the the actual fact.

don’t so experience. – we basically, since so now, it’s accurate And think haven’t I the answer the right my really

Unidentified Analyst

framework of years down And Last agreements a Language] strategic updates [indiscernible] over once All but down A for long-term year. with been six is policy the conference dealer units announced in hold agreements control government have call years slight XX,XXX ago, right. on two these XX,XXX over follow-up. car important couple Kandi likely car I changing to paying and [Foreign put any share something enterprise five agreements. policies, renegotiation subject is to on earnings subsidy to have units clear.

Hu Xiaoming

been [Foreign the repeatedly yet changing so half in Language] in the much Just also way first actual sales Also still this had than two we contract. market changing pending condition agreement EV like you of share said, framework the the the has of. not has these and haven’t year policy are

Unidentified Analyst

Thank you. That’s all in my questions.

Kewa Luo

Thank you.

please. question Next

Operator

our Private Miller, question comes And next ahead. Please from Mark Investor. go

Mark Miller

have I folks. one question just here. evening Good

On Hu production, the deposits. yet EXX last on Mr. said overwhelming has not conference cash the call,

You want not Mr. sold of you now same and mentioned outside Kandi in put dealers guys to international to in a the to said, deposits Do guys. the have how also there that many in have much they a fleet? down? EV variety report here questions the of [Foreign some a any sell China multi-parts How Hope be with only stores taking shops are stores, has XXX U.S. Two orders. selling reports powers XXX they this in dealerships, already Geely the for sufficient so of you Are Hu sell that Geely and dealer signed up the of rest the deposits, that dealers model. Language] dealerships various have deposit is dealers car or will

Hu Xiaoming

of models XXX though First want about clarify sale that all stores, Geely has Geely that Language] that each has. even stores of doesn’t but it [Foreign I all, will mean kinds four to

dealers launch Geely’s demand been current insist XX question is and Global yes, to Kandi’s expressed only expanding their definitely of while searching of for have since a to market example portfolio Then that. the in have I your there SUV XX stores, clarify product made the lot meeting want deposits. HawkEXX, the sale for Hainan ever model So answer

XXX dealers million. deposit about made have signed we RMBX and the Each deposit. is far So

driving However of XXX notice tax kilometer to exemption MIC by anticipation end which or September. of awaiting SUV expected the still and we In notice approval the of just rent tax August improving the the received company from beginning to this September, sales early EXX propel are will launch new we market a begin in exemption by potential the and of level JV profitability. hoping believe model will the is

Mark Miller

it, if I follow-up to one. XXX I answered percent Geely any it, What think are dealers, in a got of What restrictions okay. here short sort stores, you place… [Foreign Language]

Hu Xiaoming

[Foreign Language] question. Go your ahead, finish

Kewa Luo

Can you just that’s your or finish question all?

Mark Miller

interest in no shops? received? EXX. Let’s the XXX in in short shops where restrictions, top over has the with and share the XX direct of other selling restricting this the the interest allow in true, four here. China what follow Geely the in Hawk Auto would is Any compensation financial of brand, up this Kandi financial electric one Geely is then gas sold lastly, no the got. this sold been with I’m year. Global why Geely sales which If Kandi for has any version all Auto Vision And that XX the here’s to, What of is already Geely Kandi stores sub That’s Media JV, power, then I the balance the EXX if JV going reports to

Kewa Luo

Okay.

like like handling current only thought our part XXX the you has to will clarified they the and I clarify Geely you stores for Hu you EXX asking? our owned translate I stores certain but question want each of XXX by models. your last question, were felt What instill explained that Hu is for to for Before just not that percentage to he of only Mr. store that our store – Geely, have though

the interesting selling are XXX EXX. stores So these stores our – are that the are

So just that? want to clarify

Mark Miller

But with affiliated not Language] [Foreign Geely. they are

Hu Xiaoming

[Foreign Language] Kandi. JV and is owned Geely

that store So is Geely. if And [Foreign Geely Hawk. Language] it selling to plan related the Global the distributor JV cautiously sales

Mark Miller

Okay.

Kewa Luo

Okay.

[Foreign just Let the me translate question Language] asked. you

Hu Xiaoming

Language] [Foreign

Kewa Luo

you’re Hu in is correct company. holder a that bit Geely what equity JV [indiscernible] little is Mr. off, a XX% because saying not

in the JV the financial together interest a So EXX naturally, by has company. Model Geely it developed JV is Company. and

saying So Kandi interest, in no don’t the allowing share Kandi intervene brand. sub why you’re has I understand, Geely to that. JV JV financial

Geely developed branded So EXX developed, it is brand and has both Geely. by the Kandi JV and Kandi JV and the that Company the by

want to clarify I So just that.

Mark Miller

Geely much receive on So Language] would how compensation then sales [Foreign the approximately?

Hu Xiaoming

So the interest XX% equity has Geely company Language] [Foreign JV. the holder, in equity

money Geely acquired part So the what JVs the for getting we auditing half will going sales. sales, it’s half not Geely each the after – of financial to of of from take results

Mark Miller

get I up work. Keep Thanks. the Thank Okay. good it. you.

Kewa Luo

Thank you.

Next question, please?

Operator

And Mark Please Future. next question from our Kahnau from ahead. go Swiss comes Liquid

Mark Kahnau

or good everybody. fact four have Yes, in good evening I morning, questions.

[Foreign first new and reasonable question the Is Now maybe actually is on – we top you? Language] What the yield each is were Kewa by model two? you the difference KXX the if model. EXX? of new that go between other [indiscernible] question each question,

Hu Xiaoming

name [Foreign KX. Language] The

the same the manufacturers model the model is they thing. brand for name internal is number is KXX and But EXX, KXXA EXX are all, of the First marketing.

Mark Kahnau

KXX the And the Okay. range Other what and Language] second I from UKXX get the than question. different increased in is it. the [Foreign KXX? KXX

Hu Xiaoming

Language] [Foreign

Kewa Luo

And and version KXX are KXX upgraded both KXX. of KXX and

increased. is upgraded, driving short explain cannot performance are in the the details that overall all but overall In only as have upgraded been driving technology I range Now well. the

Mark Kahnau

Language] last questions called the that [Foreign always up at with release speaking Okay, new maker got for Business modeling? it. EV also possible any lastly, And maybe of have keeps same And companies five EVs other for media two has different new Beijing the China the China. to two energy together. aware EV

Kewa Luo

in going The Electric rapidly. is China vehicle industry

manufacture as brand, has been models. closely to identity one following to thing introducing the models with sector more each them. And think coming I products own a up our trends of pioneer candy enhancing of even EV and in So variety than the five is certainly more exciting me have as market EV well

the new has the their the counterpart are concept difference. brain I its I I’m EV They same different. Geely called see by our very is different of think the believe the model EXX, numbers EXX I cars, consumers energy interesting HawkEXX. its that sure the will called are Global guess

Mark Kahnau

you for Thank Okay. my taking question.

Kewa Luo

you. Thank

Next please. question,

Operator

question And our comes next [indiscernible] from

Unidentified Analyst

Hu. you, Thank Mr.

to wanted Hu. questions. nice approved old that was by the impressive I Executives and media have two very China particularly Mr. new it that one That the to in quickly. liquidity by With consider even so have in your models, the in Just models Kandi were more quarter, say do with comments all

quote, So company government pronouncing, That right at into Vehicles, Enterprise company venture is production RMB of – for of is billion. session X, June Media I a China between and specialized and bank group, the me Financial expected this let the Cooperation group passenger get in said Zen Nasdaq now. in listed the be X.X the holding Electric I’m year and Financial reach electric second Hu pure On will article, technology Kandi Conference. a Zu sorry Lee cars it’s the to Gailey vehicle that Officer Kandi joint reported XX% Chief taxable

call Group statement of year, for of you list I face ties Conference curiously that’s Now the That’s promise about the Electric hosted Improvement production. Language] questions. to about guidance then quote. to [Foreign by EVs million Quality $XXX made XX. recently in want of trading is at right million the and new XXXX [indiscernible] vehicles quality in for be in goal stated and by the the on to Kandi into Mr. At Hope July XX,XXX this in Mr.[indiscernible] XXXX production the of him I go Mr. conference profits this the end the that’s this pay also to about of revenues Hu is by number Hu sales include March year Group end into requirements Vehicle us first which conference losses an with CEO, also and on quote XXX the $XXX XX appear would and for which

Unidentified Analyst

EV’s mid-year this the its EV Since have second have at both would cars see parts Language] made million comments a There’s these almost this Hu on [Foreign and goal, to for selling business phenomenal sales Mr. JV. with by XX,XXX sold for one each of the is worth half and were pretty so end few have reach of were a own of we year. $XXX still along the target

Hu Xiaoming

less the EV kilometer XXX new currently structure stay we the of very sale our half. product MIT. have KXX and excited or the JV resumed I and we EV the sales consequently EV production a in and new XXX KXX, its look a made range some has company XXXX will from EV company a policy, to EXX and than result. to the boost developed the much the think In selling Company XQ models of models has have approval started and believe JV us including second – half government August KXX has manufacturing that in XXX meet exceeding over normal the that to The are range, with with product Language] given subsidy driving to so have boost XXXX first forward [Foreign adjustment kilometers, will sales, kilometer the we I we driving all

Unidentified Analyst

in with to he EV’s down fact turning XX,XXX as was as XXX,XXX but machine, of Language] new track call there. XXXX have that’s three Mr. quick this maybe One fleet they a in have conference past target the for said goal, back do [Foreign question if a Again totally units, again a target Hu year a for on target. to it in the of the last the capacity are is certainly March orders the and that all still

Hu Xiaoming

XXX,XXX our goal. [Foreign Language] EVs Achieving in is sales

China. regain we’re towards the EV try market and adjust our – This plan ourselves according each condition work change. in to goal. Meanwhile, in that leading will also goal the candy’s will our best we year, aren’t position determination industry We are to

Unidentified Analyst

very you, good. Thank

Kewa Luo

you. Thank

Next please. question

Operator

[indiscernible] Please And our next ahead. private investor. question go a from

Unidentified Analyst

Good good also. questions about have national I to and evening subsidy. all two the morning

Mr. process last that conference asked in the already also XXXX that is settling. when on XXXX, quote payment subsidy the Hu for and this the of question call On I and clearing

June color companies some as give many delayed XXXX could some especially was still the So, And July, the payment, we step having or Kandi. to from Mr. in now Hu payment we are little regarding to still payment August $XXX are the that short which seem Hu in approximately expecting and subsidy question, so and and already and the from that received the to owned subsidy that past $XXX no which why Language] JV first receiving part, clearing as of owned media, seemed And or happen from July? expected last been first government yet has have My settling, in be would Mr. researches are for long to a and Hu the billion was in JV. to Chinese added in personally subsidy XXXX giving months. process Mr. a RMBX.X impression quote the June bit which the just few finalizing here is million aware before he on million in [Foreign to

Hu Xiaoming

expected are settling will and the only government receiving of by remaining At each be has RMBXXX.X it Company, for government. It’s transferring of delay start October. Language] very clearance Ministry but Technology. DynaScan XXXX The by of to subsidy been clearance been there yet of The company, million, has of day the been still that been how attributed have to government the only a approval now and subsidy reason be first [Foreign to determined. Technology, financial the Industry doing. is Information will the and settling documents is taking working each handling has provided while The process department. – XXXX payment, allocated that much the the see subsidy now, XXXX, by subsidy the each settling and in it’s clearing and in to total XXXX to be right from the we product so done amount is has handing JV and Ministry local The really in

handling is got I changes government process. said some most been what the government. just basically have update internal there from we But have So, the in

Unidentified Analyst

the is second a one. have question short I

Gilly most it JV if Kandi how alone. So does the owned that much holding of carrying the JV or the and [Foreign Language]

Hu Xiaoming

Language] Okay. [Foreign equal. loans JV The are to

a actual question. we Gilly loan. So, however trade for take next of on that each the But now, depending and the we XX% the An sales. can will the receivables Kandi are pay

Operator

Please Mike come Oppenheimer. final from question Pfeffer will our from And go ahead.

Mike Pfeffer

Hi. I have one follow-up question.

discussed felt On wholly-owned but promising, the about some Kandi the Kandi’s Hu’s that perspective XXX response, that Genoa it Genoa Mr. real last facility conference and acquiring legacy government approached what for a call, was million. RV it was he than been to to the excess up there its government any total And share has this towards asset value. Language] three win. Has quarters, Kandi, [Foreign market follow-up cap sale? government the would to huge more the of be local

Xiaoming Hu

just we amount the in Language] and cities the government wait may actual so amount is But is for promising it million plan development. I a you interest through with try the would update, government be the still still into will reform Regarding [Foreign will we it this the for our may do that more maximum the valuation, transition determinant, to or a guided never is but are on we them. This be $XXX have to The believe municipal be less. contract, opt-in discussion is so asset entity.

Mike Pfeffer

of million question did Okay perspective is thank question just, Hu follow sale. company not call. the Mr. the $XXX reflect net One you. that million. from conference most the the $XXX same and million, up overall exceeding on valuation this valuation year Kandi Last Geneva follow-up reported asset $XXX stated

Hu not be, should opinion either his friends So new more he have Language] business scarifying at Mr Mr fleet current buying Kandi this in discount be new bright on Bing, XX% with the EVs a thoughts to share liquidation and higher Hu gone and would might perspective value [Foreign the of would or Mr. us attracting can a why give and bid, of of trading us outlook up thank considerably contacts Kandi be value a what with value and overall the you. or

Hu Xiaoming

am undervalued, $X and know six back on others, months I the to certain Language] on very Kandi $X buying of of by the myself shares, stock I make all behalf or [Foreign our confident the plan million others million go worth within cannot criteria. price others We based speak is cannot stock extremely feel make but next I

Mike Pfeffer

Thank you.

Hu Xiaoming

Operator? you. Thank

Operator

questions And closing I over additional turn would like back no there further to are the for at remarks. to time. speakers or this conference

Hu Xiaoming

and In allow second team Kandi ladies XXXX management Kandi’s you, attending at all Thank board Language] quarter Group represent the me to to the [Foreign closing, and commitments. of reaffirm gentlemen earnings our directors for Technologies call.

value to much with our Relations quarter the We you contact our by I diligently maximize to your the to to look we Thank your you shareholder EV believe have additional hesitate bye. work please department. will hope next industry. continue Investor support. forward focusing soon and business growing any if very questions, leading continue you strong and that to EV to operational for support in position will back Good results. be the while strategically with We talking delivering we don’t

Operator

may for now this you Thank And disconnect. your you conference. concludes and participation today’s

Kandi Technologies (KNDI) 11 Aug 182018 Q2 Earnings call transcript