KNDI - Earnings call transcript Q4 2018 | Kandi Technologies Group, Inc.

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Operator

Ladies and gentlemen, good day and welcome to the Kandi Technologies’ Full Year 2018 Financial Results Call. Today’s conference is being recorded. 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 full and conference earnings everyone, Kandi Inc’s Technologies year 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 Officer, With us Founder, today Chief Chairman Executive Mr. Financial Chief Ms. Interim and Xiaoming; Officer, Hu Xiaoying. Zhu Mr. Hu and Ms. deliver will followed question-and-answer session. by Zhu a remarks prepared

Safe call. the going forward-looking the that discussions Private will contain started, Before the Reform XXXX. Harbor note we I’m Act get of statement Please Safe made Harbor under Securities Litigation the statements review US to 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 US 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

you [Foreign Kandi surrounding conference the gentlemen all Language] due for confusion the over battery years XXXX to experienced and Hello, the year reusable joining model. challenges call. friends, ladies full has thank our Language] and earnings [Foreign past exchange few

the plan pleased based XXXX of the plan downturn and our in while overcome hard to rebuilt we to through obstacles work refined revenue XXXX, refine industry’s loss pre-tax and Through $XXX was XXXX, result, very momentum, million revival, be with XXXX issues. practices, XXXX, and compared further the upwards of up income was our this X.X% the projected moving $XX.X to our However, our forward million resolve diligently million; survival, plan to prepared financial year on [Foreign a XXXX continue hopes was the and we XX,XXX to for Kandi prosperity. to business a new performance. execution in $X.X achieve In been JV are our will situation. and team on we Language] and of the XXXX, we of ways. Company three-year Kandi total our and be EVs has First, to In as XXXX. working of producing and management its XXXX year model following in XXXX. XXXX goals company’s in in Early to selling a opportunities forge these

of to Second, to is a official the the license and with enterprise expecting obtain dual the production licenses. approval become manufacturing Company Information Industry of Technology manufacturing its from EV application Ministry for

up or the share registration ride-hailing American model models Transportation, following for EV for and a later we eligible tax the in EV NHTSA’s in business year. which of vehicles. upgraded Kandi car to market sales electric the preparing the models in online China, of process an Micro for expected debut been this plan to broader program, strategic is Fourth, EV has market Kandi open the Public the credits a opportunity federal US in Traffic by now Safety certain Kandi importation Third, the Administration’s Kandi up and are models for capitalize are approval, on US, presented XXXX. of To in National the approval Highway in $X,XXX XXXX to

equity time unlock JV for restructure to order Finally, Company. the of Company’s in shareholder the the is the JV the optimal Company evaluating to value

[Foreign take Zhu Chief the reached our milestones Financial that, you financial the you. maximizing highlights. call taking details more we achieving turn Language] Xiaoying, to the long-term We After will business to on to our like in our are Officer, of full I I would dedicated Ms. questions. have give advantage results stronger as far, investments. XXXX, as so in well Now, shareholders’ Thank

Zhu Xiaoying

[Foreign Zhu Xiaoying. everyone. is My name Language] Hello,

Non-GAAP the share the the full are company for year net recorded of cash net its XX.X parts was [Foreign with adjusted other [Foreign share Now, increased like was $X.XX US intra-entity I walk million, on Language] company change eliminating and X.X higher For per full brief year dollars XXXX. decreased a was of diluted were XXXX in After gross noted. loss three the XX.X the due in XX% fully allowance results of in in compared in The Language] compared or [Foreign per Language] revenues million sold increase X.XX Language] to XXXX. Language] at million X.X after unless a XXX.X [Foreign and year flow. $X.XX in products in XXXX, were total million, XXXX loss in in year was XX.X X.X the XX% XXXX in net of vehicles year receivable. [Foreign overview was income XXXX. fully [Foreign Language] compared net was loss XX.X JV during assets full you profit for revenues to XXXX. corresponding of increase in approximately operating from net period The activities let numbers for as receivables XXXX. operating non-GAAP otherwise million a to in full Cash XXXX. XXXX from Autosports provide Please was XXXX to per The financial full X.X during company a mainly net the in from of Language] increase Next, Total received results company as the expenses from note decrease X.X% [Foreign of First, of off-road this XXXX XXXX. million million accounts before XXXX. of was margin activities sales discuss X.X major XX.X XXXX. losses was from the for with off-road facilities per million Language] financial of were our due in tax our expenses a decrease GAAP XXXX. income for SC I or company’s the loss XXXX, in will X.X million, XX.X from XXXX. in packs. Language] XX.X% operating deferred XX.X XXXX. to government and through The of after-tax $X.XX accounts JV to vehicles the investment now. sales increased XXXX. million loss the million gross non-GAAP diluted accounting, of for accumulated and were margin of increase a of income Gross share in interest in tax in from million, has increase off-road Language] cost under me vehicle tax payable X.X XX.X for the year. year increase payables of JV in activities million investing Language] a expenses derived the or The loss margin million million are for compared Language] to used due well a July [Foreign sales increase adjustments, was Kandi’s million used JV diluted of or margin the XX.X battery [Foreign was from from will Gross net increased year was of XXXX in revenues, the from from I Let Language] Kandi result, from its increased in million, the of JV’s accounted sales the was was XX.X diluted gross decrease million activities loss In [Foreign and today before increased the income of [Foreign that will million attributable additional due gross that in XX.X [Foreign financials XX.X XXXX full increase profit was in investing as XXXX increase Total XXXX. in an or gross loss million. activities all Kandi losses, loss XXXX, per XXXX XXX.X in the cash EV as XX.X or in and million of XXXX. in a cash the XX.X or year [Foreign to [Foreign cash The compared of in [Foreign EV the a million, XXXX as total X.XX sales X.X of XXXX million million the primarily increase total in of XX% X.X touch provided decrease loss XX% of million sales million in for development in accounts largely the XXXX. operating tax to XXXX accounting XX.X due share million company X.X US approximately a XXXX. million compared to XX.X valuation was in in XXX.X% loss in was million XXXX, compared Language] X.X% major sales XX.X% mainly share the increase During Non-GAAP of increase X.X tax other [Foreign to JV The The which of the XXXX. of full largely accrued XXXX. increase of XXXX. and R&D research in ownership in vehicles liability, company Our XX.X increase to provided Language] million. share X.X construction operating GAAP compared operating compared expense XX,XXXunits review the from activities for XXX.X net million our is goods million tax XXXX, became income of off-road XX.X% with was the expenses Language] as XXXX. method were grant of a the [Foreign company’s equity fully fully JV subsidiary Revenue wholly-owned company’s $X.XX of primarily because total per Income share in units in million to of used a XXXX. net due from in of profit, the as loss million JV sales XX,XXX for X.X% revenue loss was Language] sold loss sold me with Autosports, Kandi’s expense SC cash or to was

financing of During of was to for activities XXXX. financing used million. X.XX XXXX net acquisition that the XXXX, of An [Foreign as compared cash of activity amount in X.X activities used received in was million cash Kao, of XXXX in used activities the The [ph] X.XX the the [Foreign in short-term used major bank Cash investing XXXX major year of that Jinhua notes for Language] financing cash of million XX.XX proceeds provided short The and of major was from bank cash was that loans. of proceeds payable cash loans financing for from payables activity repayments million and million. XX.XX million notes term XX.XX Language] XX.XX of repayment million of

Hu Xiaoming

[Foreign Language] questions. Operator, some we’re to ready take

Operator

our will Instructions] take question Ted now [Operator from first We Schwartz.

Ted Schwartz

million $X.X expense both X.X understand that? million itself joint venture you a that don’t income You where explain of could added expense any tax showed context Kandi came and in, loss, for I the for

Kewa Luo

one more can just repeat sorry, you I’m time.

little tone a Your is skipping.

Ted Schwartz

me. Pardon

Kewa Luo

a Hello. Your tone your time? more is repeat please you question little one skipping. Would

Ted Schwartz

venture tax million joint expense I Kandi don’t when showed and both a could understand income the how loss? $X.X the

Kewa Luo

Language] [Foreign

Zhu Xiaoying

accounted of Okay. to The X the due expense income not the asset account to [Foreign in the profitable million high rest paid, million it and million necessary because our in tax that Language] had was construction part X.X X.X is we necessary from subsidiaries the but accumulated high its actually statement. altogether as who expenses. tax tax most deferred of period allowance other is income still financial loss valuation the This is is for

Ted Schwartz

like know EXX KXX Just about are and they Hainan. the through the I’d to what going what the production? XX, cars and levels presently in of

Kewa Luo

Language] [Foreign

Hu Xiaoming

and KXX set KXXs and EXX of Hainan we Language] of Right XXX presently facility. in the production in of there production parts have planned now, for are [Foreign KXX, Okay. EV are March,

Ted Schwartz

you Will and producing selling Hainan be in in March?

Kewa Luo

Language] [Foreign

Hu Xiaoming

probably are if Language] set. will we XXX plan license, of manufacturing sets now, going to it’s still sales So produce EV these parts be on Language] parts month, sales so of EV this month. [Foreign so to relying we next to [Foreign the since have Right happen the

Ted Schwartz

All sure understand you. right. Thank but thank question. it, the you I Take very much. next Not

Kewa Luo

Operator, we Thank can question. you. take next

Operator

Thank you.

next from Our question comes [indiscernible]

Unidentified Analyst

revenue credit looked you trading a important credit this source give or decided? in status at program, and that carbon have implemented for forward, is Okay. I trading. how can not of may question a the fully it yet joint that I being China be involving of going present us an has been believe carbon venture

Kewa Luo

Language] [Foreign

Hu Xiaoming

credit the of the the policy Language] We know benefit [Foreign policy release. details planning trading the Carbon to is on in stages. still don’t

We we news being that but regarding haven’t seen final have of policy this, heard a lot released. any

Unidentified Analyst

Okay. Please I questioner. Very very another much. good. Thank have later. may you next the take question

Kewa Luo

Thank you.

Operator

our next take now will We from question [indiscernible].

Unidentified Analyst

so if be is the to a timeframe it the The question subsidiary production, and [indiscernible] where do of what subsidy subsidy sales, Language] because for the regarding XXXX. resolve paid. [Foreign is was the My doing XXXX delay get you this does basis with is, delay, issue, this to have production the not or

Hu Xiaoming

affected. the also [Foreign be the Language] the changes will delay payment, in Due to sales the definitely subsidy policy, in

in from soon we’re we receive also XXXX we that be from the subsidy process to very this and start of for now, subsidy well. part the are and clearing of very paying the payment XXXX soon going and been stockholding and As as subsidy already the will XXXX XXXX anticipate told and

in in seeking US. market breakthroughs government credit vehicle the and And company of the so the is online

a We have of and have lot work that very result. to XXXX, promising going we believe doing been we’re a

Unidentified Analyst

another being car This have produced. question. about the I is

car now? so produced mostly [Foreign they KXX So just and produced the Mr. EXX, sub being where Language] mentioned Hu KXX, are

Hu Xiaoming

Language] [Foreign

Unidentified Analyst

[Foreign Actually, there plans what Language] cars being your I are Shanghai. moved for heard is be particular to the region some and produce, in plan any should news

Hu Xiaoming

[Foreign Language]

Kewa Luo

Mr. said. what translate Hu me Let just

of all, KXX, is answer produced first produced? is First all KXX, being The these [indiscernible]. being is question are where EXX, cars the at

the everything all In at [indiscernible] produce answer and at lot right however the of so at all but on do have and we license, location produce some out in used a also to to rely already we to Rugao now, KXX volume, have we place. separate in the the locations, of So to and location right so all we and don’t safe cost parts, manufacturing is license because Rugao in Changzhou instead gentleman KXX the for the these asking Shanghai, centralize we JiHeKang is, produce why And vehicles cars these centralized at one we can production different past, example KXX spread in since one EV for at production Geely’s used now, Shanghai. a factory Hainan. , Rugao one

Unidentified Analyst

approval from more one do are Difficulty] Language] for you have people we for Development steps has question expense license estimation, IDRC that Reform the at approval process Investment when I manufacturing looking still approval, [Technical are currently MIIT, [Foreign two Hu’s So the expect Committee, these the and least to with this last from looking second happen. Kandi so so

Hu Xiaoming

Language] [Foreign

Kewa Luo

Okay. Sure.

approval regarding and means this to Hu of to approved some the So has to the this and further we is Commission regarding this likes dual question us. actually earlier by the the build been factory. Reform NDRC the we clarify confusion Development what there enterprise issued believe and license production Mr. mentioned And to license

the So the acceptance of the that’s the and next license. first step by Ministry of Technology. Information Industry And the is factory

As a to called the license is MIIT car factory has to that’s the third and to is included and company second be And road. in that which result, usually, registered in the able step, together, China the the license to is driven there be be a on able production will be the it’s cars approves factory applying. once order in to company and company dual the produce

this the car And manufacturing you and in basically them all beginning MIIT in steps the the in have are for from the for procedure available market. our we three sent March finally application those is the will for be for we same So of be expect And and beginning getting car already sell the China. Kandi, in hear April. of order approval the the to to in

Operator

our next take We will from now [indiscernible] question

Unidentified Analyst

later in in California is you the in in correct? regard ports expect what in that to what US? of is gathered to the that KXX release do that States EXX. and been press still Excuse place if so the is me, go My export from to and are question from once correct, approval read to what is that the and to the your pending this in the automobiles ready these sale to the has also approval My understanding United in opening is California, for obtained California your dealerships I understanding my opening to export US you plan from is automobiles year, export I

Kewa Luo

Language] [Foreign first. translate me Let

Hu Xiaoming

sold be [Foreign Language] two models can the nationwide. in These US

just in and waiting not are import XX any With choose now, sales to – working application application to which any May. one. to team XXX to is not used that it’s importing vehicles a the of in there on are anticipates forming we I US the salesforce So, we Right be end no company is the waiting will the California. of team so process California, it the be, efficient in EVs think the regards by US, to cost into for ports most going and

Operator

is Mr. now next take appears will your his now away open. handset. ahead. Pfeffer from line he from stepped may Mike from go Please It have Oppenheimer. our We question Pfeffer,

ahead. We next will from Please question now take our [indiscernible]. go

Unidentified Analyst

province. when RMBXXX projection with the And the to that there interest designed know, what is KXX place understand can is program loan not, have if part, I Hainan the might for second their factory as emulating wide the you, discussions low going and Hainan with about start million, reason. be started meaningful business, and has Jiangsu we been in

Kewa Luo

Language] [Foreign

Hu Xiaoming

production programs, because yet, hasn’t XXX question, the been the a that Hainan planned parts Jiangsu, factory. government And of KXXs set chain financing any discretions producing we EV. about in already in producing for have there Hainan, to supply that March we just are support in started We part Language] [Foreign regarding EV of

Operator

We from next will now Steve Miller. question take our

Unidentified Analyst

related Two questions. you. Thank

year, XX,XXX was the this announced are earlier the EV what JV XX,XXX you framework that XXX,XXX going this is XXXX, before affect can ecos For understand ability be reached I agreement EV and the related for revenue agreement be produce by for is anticipating and car requirement payment, and year? that, Kandi the to from And there to apply cooperation show the JV’s vehicles? that a to the negatively program to kilometer to the subsidy these you

Kewa Luo

So first the about for revenue is JV, question right.

whether the requirement mileage is the for kilometers will question program. the XX,XXX be second The

Unidentified Analyst

is, first comply agreements and from subsidy My kilometer are requirement question apply are whatever be is, cars sold the I you guess agreements, both to that for with XX,XXX the to question order the payment? for what you able to do have you guys revenues in second anticipating with in those connection be then to

Kewa Luo

[Foreign Language]

Hu Xiaoming

alliance These program. were Language] serve on credit XXX,XXX [Foreign signed of in contracts the implementation vehicle to order the government

We subsidy, used in XX,XXX program don’t the any service the to requirement average. for from be I expect month there usually because kilometers begin for online run impact vehicle April. each per that on is kilometers XX,XXX think will the

the they exceeding months, kilometer be requirement. three in will XX,XXX So well

Operator

We will now take Kahnau our Future. next question Swiss Liquid from from Mark

Mark Kahnau

me XX.X what that XX to reason? quarter, correct seems million have aftertax that was written JV months, the of must fourth correct year, an and It was for million, if nine growth effectively venture XX,XXX, off it’s Kandi in about the end of only first by for joint loss the up for the means the me, is that breakeven, there

Kewa Luo

slowly just time so you more can sorry, can translate. I one I’m

Mark Kahnau

Through have of the after means the year the what share quarter, joint But fourth joint the growth for of loss effectively it’s the that venture is XX,XXX tax end, breakeven. of by Kandi million must off venture on in me and figures. million. months the was That that joint was was first written of year, XX the to reason? the correct this if USDXX.X venture nine correct

Kewa Luo

Language] [Foreign

Zhu Xiaoying

RMBXXX [Foreign in million Language] for is QX, was JV This due expenses to, there QX. R&D in in

Operator

from Harris our Goldman. now will We take question next

Unidentified Analyst

a existed. trip talked we we Hu, year. thing proved clarification a the little quite Anyway, my a in having that Hu’s that for Mr. regarding see need And long we’re and I’m little wrong. of Mr. when the trip, units. detractors, XXXX XX,XXX confused since question in time I to never course, were projecting I this a been organized made It’s few we I guidance is the statement,

XX,XXX have production framework only we we is stance conservative Now, taking for my confusion to this Hu the a units, years on very five accredited clarification is, JV XX,XXX on would regarding he Mr. agreement he’s XXX,XXX units? over a provide have year other or guiding why and

Kewa Luo

Language] Okay. [Foreign

Hu Xiaoming

we XXXX, Language] be [Foreign to mentioned earlier, that XXXX, to that as available. look forward for to we Well, want and glad survive able were we for I are

And contracts, we have so in for we this laid out year, EV the primary even provider. XXX,XXX contracts though are these

take thing overpromise groundwork year, to want don’t and one growth the underdeliver one more laid forward. out step we and want this for So, the and going market at for we to

quality products additionally, be and we better our and focus of to also results So the want on to forward. going deliver able

Unidentified Analyst

Okay.

if this is guidance we very install I’m earlier guidance the subsidies, I’m what appears hearing that’s our year, revival this this yes, sales, in heard alone, unit therefore, Mr. Hu, curtailed what read, a from problem this for year, So terms year. XX,XXX this can I’ve we that from the because it we said I’ve and And that for have what revival subsidizing understand so if reasonably a been me much production but now received been expect from year, of subsidy. was to optimistic be about conservative our this will I what because and we basically has than more

it. that’s Okay, Thank you.

Kewa Luo

Language] Thank [Foreign you.

Hu Xiaoming

Language] [Foreign

Kewa Luo

Hu thank can business deliver will work hard we We question. result. next take says to you, Mr. good

Operator

Oppenheimer. will take our question Mike We Pfeffer from now next from

Mike Pfeffer

to significance now many several Kandi XX,XXX for and confirm its confusing EVs well for with particularly the Even pure a it to own you this build mentioned approval years and The Hu secondly, approval others project press as press for the license in for, you release release. all in what reporter approval was said is already titled Kandi in Mr. ECs as to and when vehicles facility make we received Bloomberg confused XX,XXX Rugao. one, said where Kandi the along awaited electric can US, that Rugao, was was of sell JV in the number the allowing is a

Kewa Luo

[Foreign Language]

Hu Xiaoming

[Foreign once actually which to this discussed to for want earlier call. your the I license, again steps manufacturing you Thank question. are in three total. also there regarding Language] clarify on I With

factory First is the the company be to Technology we first model units April, cars approve able Ministry factory as and from approval and ready not in to the is of we by the the to they able just by should what MIIT factory National the next produce that to build earlier and we vehicles. will the license is, be all have we question to asked announcement. from the the be get will that to think step and will factory company steps be will Development Industry able the the entitled The do then which mentioned XX,XXX we the about the Information then, dual get And what and and approved so release. we MIIT, Reform factory, is step these next and a register. comes, announced received is this to approval in Commission able we once the once this press that And the to you is make and acceptance thing is and called of produce production a result,

achieve factory. upto the you to your build to building, in apply capacity to XX% license you NDRC another the you’re factory the capacity of the include have factory, to location build for order in have you at when So least

over if want in different we -- for we we of XX,XXX So have XX,XXX factory number XX% XX,XXX to a at factory, location, that achieve to number it can produce just, you build it’s is this applied is but in give to another XXX,XXX for example, the capacity we that least application. a go say we so which

I closed on hope you what I So just asked. with that,

Operator

will next question We take Porcari now Corporate from our Strategies. from Arthur

Arthur Porcari

itself ride year address hailing I limited XXX,XXX mean, two can moment series this you expanded which for X a $X Mr. year Hu it like a taking XXXX. public XXXX sounds I’ll XXXX it to X, an just January finance million an prior loss don’t almost the observation to how have numbers, in long announcements and XX.X potential Hu, to all stream EVs million it to and that ride see and wrap of JV billion it I and the actually since want a consolidate EV next over the an the sidenote on thanks in the profit even for the cost five And want More to the billion hailing improvement ask program, said, fourth caller of amazing having witness the you I out the on program. address R&D years. shareholders year had JV announced. if $X a major year five for on to the on was of way to so five mostly pretax for three as appears XX,XXX based incredible based Mr. first not year to XX Resources start I share so everything then to like of a year to? deliver by would question. or up Kandi to And quarters, just quarter pass worth the With break said, congratulations would areas forward, JV and over today’s just questions, break of to this expects full EV XXX,XXX announcements, that it’s China the the

Kewa Luo

in about repeat, you you ask first Can the Arthur. part Hi, will JV. the

Arthur Porcari

this expecting saying additional quarter the take was an I writedown this for million we in think the quarter. fourth this, independently That’s observation, for that, realized the $XX how the point shows I pretax wanted Kandi’s the back just added one is in, I that almost performing have actually – saying numbers, fourth time profit Okay. JV? million the Kandi which expense, million side that that if R&D to it said were this itself, Without at which $XX make. had the is would I to Kandi loss because of add-on of seems already in a I is like don’t caused that’s Kandi $XX itself we the was X that well an million, JV I’m million, XX.X over

Okay. have it And me or you do of rest repeat the it? rest the you want to do of

Kewa Luo

Go question. ahead with your Language] [Foreign

Arthur Porcari

Okay.

it’s is, and and this an Kandi’s hailing color online question the was ride-hailing “parties [indiscernible] end in First which innovative show Geely ride XX,XXX states exploring understand, see Shu good from program what announcement, and China advantages. combined In business currently this end EVs and ride Volvo a easy is about to so all high for high to like collaborate that easy partner, by unicorn the their resources XXX,XXX models Kandi have white easy and hailing for Uber that agreed I JV has new it’s market Li put an with it together Fu program, Holdings.

the or models get is this what this battery [indiscernible] from will end KXX used have EV used quick over EXX that high Now into will we and the be that with program right the question new will be Kandi as so well. be released, developing means and above already exchange

Kewa Luo

[Foreign Language]

Hu Xiaoming

is Hu saying Mr. lot questions. that of [Foreign is Language] a

by one will one. I go So just

end not which be [Foreign going going to car, for going the the B requirement the venture to the required the joint platforms. the is just and ride alliance other by base is going a Language] for to joint requirement the base services, called other Because platform First, to this is driven and… wheel XXX,XXX these therefore, our be high EXX’s hailing platforms, which hailing and developing by or And is wheel initiated launch the [indiscernible] KXX that online are all ride was so ride-hailing it’s car on platform. KX there company we is signed class, the the not venture meeting for

Arthur Porcari

going that is KX? Kandi And to be developing new

Kewa Luo

[Foreign Language]

Hu Xiaoming

[Foreign Together with Language] Yeah. venture. joint Geely

Arthur Porcari

That’s breaking news.

Okay.

billion potential the that quite stock me exchange the to life battery the for announcement the which X instead quick X in announcement. have stunning effect as patented This the for XXX,XXX base the version. the the consumer To directly JV announcement Kandi. addressed no feature of packs Kandi is owned would five additional primary this Kandi parts EV battery this could Let the move required X and think QBX, year and time, over on. the at I battery $X provider JV on exceed I program, made billion of and in on as it, to assumption a was the plug an that requires

EVs used have the on which can the which all provided? this I also then second assume for feature is, or the Based quote of XX will alliance, has China exclusive have short EVs exchange many battery that growing? supplier China locations will And be will they how service a feature. any primary across quick have have members So vehicle be two Resources this. to questions, the the does announcement, provinces EV, have the from this JV Kandi true, quick do have we quick if in company to the accredited be locations exchange in the be Kandi the with feature battery question feature they battery XXX,XXX that are quick all still will the vehicle current likely alliance station exchange questions exchange And and battery and for will

Kewa Luo

[Foreign Language]

Hu Xiaoming

Language] [Foreign Okay.

Mr. all provided. try Hu me cover just to information the Let

is on they First and we Kandi strategic credit the China with I be alliance the vehicles, have the And of don’t them used providing many have, surely some battery the us they they EV partnering since exchange they are primary to providing this based throughout however, – of electric in vehicle know the – the of location many China EV may and going into all, Resources, a giving in vehicle the provider at I don’t think the this number have be in in for also point, go battery. the the that all to of locations but and to the and will how available alliance. them always of these and gasoline operations demand investment charge the

alliance be quick detailed surely specific the all that on Kandi credit battery to EVs. is five used will in I and years building services delivered will from within demand Now, business think of going battery there be vehicle feature for the the required these program. exchange depending be plan this future vehicle, the gradually And exchange the

Arthur Porcari

rapidly X next is into Good. would first certainly JV require we XX% address here, conservative $XXXXX is but financing, Kandi since quite billion to the Okay. that my a it Kandi looked be comment enterprise, then. billion have get following probably has these $X to JV, think let’s It a I projects with do would to buyer these press section in factor to alone, car, seems partner, your at a think high, over a on would towards government started. it to get number the least China to through only by about a here, cash with Anyway, just Resources deals controlled the you’re credibility on

to JV any formation. equity partner our has since outside raised the not far, so So,

company or USDXX.X in this perceived has [Technical a date, evidenced X give value billion have in over X, these together, its startups, uniform early compared to X public as years negatively with billion from to all China any JV, the has USDXX a Kandi two to this and first the of to call. they’ve rightfully less as up and hot RMBXX With only and on not even only sold announced stage X how have raised China, response total to that recent stage to at come market one none intention JV Kandi EV not old billion any China, yet go include EVs Difficulty] in XXXX, has is facility to conference the of has recently negatively, sorry, billion. billion So the DL other positive sold licenses, as section to again discovered each them than each publicly I’m as I X.X between EV have

Kewa Luo

what Language] ahead, you I just Arthur. have summarized [Foreign Go said.

Arthur Porcari

Okay. market Kandi X.X cap pre-build million follow-up to billion Fine. private raised hard $X private old the reasonable in assume that billion recently $X.X as in X and maybe cap be five a the and equity The Kandi raising with year after equity it three another would US at billion China infrastructure China, with then old JV [indiscernible] XXX could and quickly about raise public maybe came the in cap JV much in billion year less the with assets

Kewa Luo

Language] [Foreign

Hu Xiaoming

think parts. [Foreign I to I answer Language] two want in

that’s new of business, a now, new JV we company’s you compare lot to for with and First, mentioned to need it’s I Kandi really developments. don’t not to discuss want evaluation. say timely Kandi for

company, optimal remarks is company’s time at on have unlock company. shareholder the significant to right JV evaluating to JV have of time. the progress, like Secondly, the order we for for point management in I market equity update JV earlier in that company’s the mentioned the the restructure working we we do value JV the my will Once

Arthur Porcari

would only Okay. if Kandi will million with to question though, And last get $XXX Kandi’s market the down the hit worth with seem why would of is around X market about even it that I here, that I think me he’s the is question, JV is Hu cap, XXX my Mr. saying to unlocking would I talking and JV. argue worth and that’s value million. the

IPO that, JV might the go, value that can consider much positive to however, it would JV start in similar China trading this IPO has will new by in I the past, whatever, for real to In be JV public Shanghai the to Asia announced been the requirement, new listings or consider require three this a the States? recently excitement the in later even consecutive China, the years listing was the could earnings year that last it’s company you little venue. for without Kandi with earnings, an divide the question the tech actual intention bringing So Nasdaq board, that of or with the but get X is announced a and IPO do should to assume public you want you treating when bring said, with past, United

Kewa Luo

[Foreign Language]

Hu Xiaoming

[Foreign or think possible still now we market. I I in too can decision, this whether but report it’s have Shanghai think right will once all the the discuss, early we to be US, a Language] and made to

Arthur Porcari

doubt, thank patience that some largest million and China the questions. Kandi has Thank needed expanded look Excellent. once maker you. really XX% beating XX% Hu a EV give used Hu’s appreciate he than forward less And a agreement did long at a market with by to and forecast. again, you I in in cap car by XX% years to my $XXX of the EV without series to partner announced XXX,XXX discussion. few again when much back least any forecast Mr. agreement, very as Mr. he considering his But and

Kewa Luo

Language] [Foreign

Hu Xiaoming

[Foreign Language]

Kewa Luo

you. Thank

Operator

a from have now question We follow-up [indiscernible].

Unidentified Analyst

I you. short extremely thank questions. Well, have three

factory approval only this and the separate MIIT from need does a MIIT? question, the both First NDRC or

Kewa Luo

Language] [Foreign

Hu Xiaoming

Language] [Foreign

Kewa Luo

Yes.

a process. are the for already MIIT fact, right our waiting and just they approving are on the all from of We working approval it’s in matter application,

Unidentified Analyst

Will Yes. X so approval? the factories, require that all there cover factories MIIT are separate approval

Kewa Luo

in asking you different all whether going Are the cover approval locations? to factories

Unidentified Analyst

correct. Yes. That is

Kewa Luo

[Foreign Language]

Hu Xiaoming

[Foreign Language]

Kewa Luo

means Changzhou, license. joint in venture Rugao has only manufacturing approved factory, that This Changzhou, when the it, Rugao but a factory has

Unidentified Analyst

Okay.

exchange quick second the be a Now, question, equipped with will feature? battery KX

Kewa Luo

Kandi I’m feature? what exchange, sorry, will the

Unidentified Analyst

KX quick a with the exchange? be Will battery equipped

Kewa Luo

Okay. Language] [Foreign

Hu Xiaoming

[Foreign Language]

Kewa Luo

all They the exchange feature. quick Yes. battery have do

Unidentified Analyst

Okay.

now license? CRC? in the now the the quick Is very the company a CRC NDRC in the is since company of in have we venture question, joint Third the eyes it recognized in the eyes of

Kewa Luo

joint What venture? do that you mean,

Unidentified Analyst

make joint a Yes. NDRC, the by of official with The venture the an viewpoint the license in joint does venture Republic is China government? the of People’s recognized company this

Kewa Luo

Language] [Foreign

Hu Xiaoming

[Foreign as company just dual have considered be Language] license official to wait for will production the We capability. to be production with EV then received,

Operator

This host to concludes to now today’s back would I turn additional the session. question and answer remarks. like call any or closing for our

Kewa Luo

Language] [Foreign

Hu Xiaoming

Language] [Foreign

Kewa Luo

Thank commitment. directors our you, reaffirm like Group, team to would at meeting. ladies gentlemen for of board Inc, today’s On and and I of attending management Kandi Technologies behalf

growing meeting. diligently delivering by your business Thank and to EV We work look again you talking on forward our will while results. for you We maximize support. to shareholder next very much strategically, strong understanding continue with operational value focusing to

person. don’t questions, bye. please any additional Investor If Good Relations have you to contact hesitate our

Operator

today’s Ladies and concludes this you call. for Thank gentlemen, your participation.

may disconnect. now You

Kandi Technologies (KNDI) 15 Mar 192018 Q4 Earnings call transcript