Greenland Technologies Reports Q1 Revenue of $29.3M, Net Income of $2.9M

Greenland Technologies Holding Corporation (GTEC) today announced its unaudited financial results for the first quarter ended March 31, 2022.

First Quarter 2022 Financial and Operating Highlights

• Total revenues were $29.3 million, an increase of 19% from $24.6 million in the same period of 2021.
• Gross margin was 21.7%, an increase of 100 basis points year over year.
• Net Income was $2.9 million, an increase of 19% from $2.4 million in the same period of 2021.
• Number of transmission products sold was 41,902 units, an increase of 13% compared with 36,986 units in the same period of 2021.

Mr. Raymond Wang, Chief Executive Officer of Greenland Technologies Holding Corporation, commented, "We delivered our highest quarterly revenue to date, as we drove 19% year over year growth in first quarter revenue and a 19% year over year increase in net income. Our team continues to make impressive progress executing on our rapidly expanding industrial electric vehicle product line, while at the same time moving forward with our U.S. production expansion to ensure we have capacity to support the overwhelmingly positive customer response and expected long-term demand."

Mr. Wang added, "Our ongoing strategic shift toward higher-value, feature-rich products helped drive a 100 basis points improvement in gross margin to 21.7%. Additionally, our electric industrial vehicle division is on track with our upcoming assembly facility in Baltimore County, Maryland on schedule for a July opening. Though the industry is facing continued headwinds from the pandemic lockdown in China, we remain optimistic given the long-term transformation of the industrial vehicle industry, led by demand for cleaner, greener electric vehicles and support from local legislation. With our proven track record and expanding product roadmap, we are positioned to address the growing demand for our industrial electric vehicles, as we focus on building increased value for shareholders."

Mr. Jing Jin, Chief Financial Officer of Greenland, commented: "Demand for Greenland's transmission products remained strong, as we leverage our global brand, inventory management and performance track record to partially offset headwinds from higher raw materials and component prices, COVID-19 shutdowns, global inflation, and higher logistics costs. In addition to our strong 19% year over year revenue and 19% year over year net income growth, we further strengthened our balance sheet with a 30% increase in our cash on hand. This gives us added confidence and flexibility, as we continue to prioritize investments in R&D innovation and revenue generation, which we believe will drive Greenland's long-term market share gains in the electric industrial vehicle market and significant value creation for shareholders."

Recent Developments and Strategic Highlights:

• Secured Lease On Assembly Facility: Greenland has secured and fully executed a lease on its first assembly facility located in Baltimore County, Maryland. The site is over 54,000 sq ft and will produce over 500 electric heavy equipment units per year when fully operational. Maryland's Governor Larry Hogan noted, "As we continue to invest in new products and technologies, Greenland's vision and growth in electric industrial vehicles will fit in well with our state's innovative ecosystem."
• Launched of New HEVI Brand: Greenland has launched a new HEVI brand to encapsule its electric heavy industrial equipment division. This brand replaces Greenland Machinery and better exemplifies the culture and objective of introducing clean and sustainable alternatives to the industrial equipment industry.
• Passed Clean Cars Act of Maryland: Greenland supported the passing of HB1391 – Maryland Clean Cars Act of 2022 that will introduce consumer incentives for electric heavy industrial equipment purchases within the state effective July 1, 2022.

First Quarter 2022 Financial Results

Total revenues were $29.3 million, an increase of 19% from $24.6 million in the first quarter of 2021. The increase was primarily due to higher sales volume, driven by continued demand for the Company's products and its effective supply chain management. The number of transmission products sold was 41,902 units, up 13% from 36,986 units in the first quarter of 2021.

Costs of goods sold were $22.9 million, an increase of 18% from $19.5 million in the first quarter of 2021. The increase was primarily due to the increase in sales volume, higher cost of raw materials and components, higher shipping costs and higher logistics costs.

Gross profit was $6.4 million, an increase of 25% from $5.1 million in the first quarter of 2021. Gross margin was 21.7%, an increase of 100 basis points from 20.7% in the first quarter of 2021, as a result of the Company's strategic shift towards higher value, more sophisticated products, such as hydraulic transmissions.

Total operating expenses were $3.0 million, up 33% from $2.2 million in the first quarter of 2021. Operating expenses as a percentage of total revenues was 10.2%, compared to 9.1% in the first quarter of 2021. The increase in operating expenses was primarily due to the Company's investments in support of its growth strategy, with an expansion of revenue-generating and R&D efforts.

Income from operations was $3.4 million, an increase of 18% from $2.9 million in the first quarter of 2021.

Net Income was $2.9 million, an increase of 19% from $2.4 million in the first quarter of 2021.

Basic and diluted net income per ordinary share was $0.16, compared with $0.21 in the first quarter of 2021.

Conference Call

The Greenland Technologies Holding Corporation management team will host an earnings conference call at 8:00 AM on Monday, May 16, 2022, U.S. Eastern Time (8:00 PM on May 16, 2022, Beijing/Hong Kong Time).

Please register in advance for the conference using the link below and dial in 10 minutes before the conference is scheduled to begin. Conference access information will be provided upon registration.

Online Participant Registration: https://apac.directeventreg.com/registration/event/2888891

A replay of the conference call may be accessed by phone at the following numbers until May 24, 2022. To access the replay, please reference the conference ID 2888891.

A live and archived webcast of the conference call will be available at https://ir.gtec-tech.com/.