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Tantech Holdings Ltd. Announces Interim Financial Results for Six Months Ended June 30, 2018

LISHUI, China, Dec. 26, 2018 /PRNewswire/-- Tantech Holdings Ltd. (NASDAQ: TANH) ("Tantech" or the "Company"), a clean energy company in China, today announced its unaudited interim financial results for the six months ended June 30, 2018.

Six-Month 2018 Financial Highlights



For the six Months Ended June 30,

($ millions, expect per share data and percentages )


2018


2017


% Change


Revenues


$

16.0


$

12.4



28

%

Consumer product


$

12.3


$

12.3



0

%

Trading


$

3.7


$

0.1



3,640

%

Gross profit


$

2.6


$

2.0



31

%

Gross margin



16.4

%


16

%


0.4

 percentage points

Operating margin



3.7

%


(0.9)

%


4.6

 percentage points

Net income (loss) from continuing operations


$

0.13


$

(0.6)



121

%

Net income from discontinued operations


$

1.46


$

0.9



59

%

Net income


$

1.59


$

0.3



412

%

Basic/ Diluted earnings per share


$

0.07


$

0.01



600

%

  • Total revenues increased by 28% from $12.4 million to $16 million. The increase in our total revenue was because of increased sales volume and increased number of customers and distributors.
  • Gross profit increased by 31% from $2 million to approximately $2.6 million because of increased revenue. Gross margin remained consistent around 16%.
  • Selling expenses increased by 65% from $0.23 million to approximately $0.38 million. The increase was mainly because of more sales events during the first six months in fiscal 2018 compared to the same period last year.
  • General and administration expenses decreased by 16% from $1.8 million to approximately $1.5 million. The decrease was mainly because of lower consulting and professional fees during the first six months in fiscal 2018 compared to the same period last year.
  • Research and development expenses increased by 61% from $0.08 million to approximately $0.12 million. The increase was because of more research activities during the first six months in fiscal 2018 compared to the same period last year.
  • Other expenses increased by 29% from $0.07 million to approximately $0.09 million.  The increase was mainly because of higher interest expense resulting from higher borrowings balance during the first six months in fiscal 2018 compared to the same period last year.
  • Net income from continuing operation attributable to shareholders was $0.13 million, compared to a net loss of $0.6 million in the same period of last year.  The increase was mainly because of the increased sales and gross profits.
  • Net income from discontinued operation increased by 59% from $0.9 million to $1.46 million. The increase was mainly because of the lower costs of sales for energy products.
  • Net income increased by 412% from $0.3 million to $1.59 million. The increase was mainly the results of increased sales and gross profits.

"In the first half of 2018, despite challenges in a dynamic and complex environment, we grew our revenues and net income while continuing our business transformation to raise the Company's competitiveness," said Mr. Zhengyu Wang, Chairman and Chief Executive Officer of Tantech. During the reporting period, the Company reported $16 million in revenue and $1.59 million in net income, up 28% and 412% respectively compared with the same period last year.

"During the reporting period, the Company acquired an 18% ownership interest in Libo Haokun Stone Co., which owns a small marble quarry in the southwestern province of Guizhou, for RMB 120 million (or $18.1 million). Since its establishment, Tantech has accumulated rich customer resources and built a strong brand image in home decoration and indoor air purification. With China's growing economy and rising household income, marble has become a popular choice for commercial construction and home decoration because of its endurance and elegant appearance. The investment was aimed at diversifying risks and creating more value for our shareholders."

"China's electric motor vehicle market has maintained rapid growth. According to data from government-backed China Association of Automobile Manufacturers, China produced 879,000 electric motor vehicles and sold 860,000 vehicles of such kinds in the first ten months of 2018, up 70% and 75.6% respectively from the year-earlier period. The Company has delivered orders for its electric logistics cars in the second half of the year and expects to record revenues for its electric vehicle business in the full year earnings report for fiscal 2018."

Mr. Wang finally commented, "In November, Suzhou E Motors Co., Ltd., a subsidiary of Tantech, received approval from the Ministry of Industry and Information Technology to sell a newly-developed electric van in China. The pure electric van, which has a range of 300 kilometers on a full battery charge, will go on sale soon. In the future, the Company will continue to accelerate research on new models and expand manufacturing capacity to satisfy customers' needs and realize our goal of becoming a leader in China's special purpose vehicle market."

About Tantech Holdings Ltd.

Established in 2001 and headquartered in Lishui City, Zhejiang Province, China, Tantech Holdings Ltd., together with its subsidiaries (the "Company'), is now transforming from a developer and manufacturer of bamboo-based charcoal products and Electric Double-Layer Capacitor ("EDLC") carbon business, to an innovative leader in the design, manufacture and distribution of electric vehicles. The Company has also invested in a marble business in 2018. 

On December 14, 2017, the Company entered into a sale agreement and related agreements to transfer its Electric Double-Layer Capacitor ("EDLC") carbon business (including intellectual property rights and equipment) to Zhejiang Apeikesi Energy Co., Ltd. After the completion of the transactions, the Company intends to focus its core business on the development of electric vehicle products.  Further to the sale of EDLC carbon business, during the six months ended June 30, 2018, the Company decided to dispose all the remaining assets in Tantech Energy, one of its subsidiaries. As a result, the Company separately presented Tantech Energy as discontinued operation on its condensed consolidated financial statements as of June 30, 2018.  The Company expects to complete the disposition process during the first quarter of 2019.

For more information please visit: http://www.tantechholdings.com

About Suzhou E Motors Co., Ltd.

Established in April 2011 Suzhou E Motors Co., Ltd. ("Suzhou E Motors") is an innovative leader in the design, manufacture and distribution of electric vehicles ("EVs"). With outstanding quality and reliable battery production, our system enables to effectively integrate renewable and conventional energy sources across all our product lines. Suzhou E Motors offers a wide range of EVs, including urban sanitary vehicles, electric logistics vehicles and mini tourist buses with current annual capacity of approximately 5,000 EVs. For more information please visit: http://www.emotorsbus.com.

Forward-Looking Statements

This news release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning plans, objectives, goals, strategies, future events or performance, and underlying assumptions and other statements that are other than statements of historical facts. These statements are subject to uncertainties and risks including, but not limited to, product and service demand and acceptance, changes in technology, economic conditions, the impact of competition and pricing, government regulations, and other risks contained in reports filed by the company with the Securities and Exchange Commission. All such forward-looking statements, whether written or oral, and whether made by or on behalf of the Company, are expressly qualified by this cautionary statement and any other cautionary statements which may accompany the forward-looking statements. In addition, the Company disclaims any obligation to update any forward-looking statements to reflect events or circumstances after the date hereof.

For more information please contact:

Tantech Holdings Ltd.
Ms. Ye Ren
IR Manager
+86-578-261-2869
ir@tantech.cn

 

 

Tantech Holdings Ltd and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited)




June 30,



December 31,




2018



2017


Assets









Current Assets









Cash and cash equivalents


$

12,243,565



$

9,736,291


Restricted cash



1,169,514




3,901,526


Notes receivable



-




15,370


Accounts receivable, net



33,989,206




44,834,930


Inventories, net



2,570,555




2,762,016


Advances to suppliers, net



3,798,325




11,290,625


Prepaid value-added taxes



3,534,598




2,976,265


Other receivables, net



935,280




1,683,906


Current assets from discontinued operations



8,720,441




12,043,956


Total current assets



66,961,484




89,244,885











Property, plant and equipment, net



3,404,506




3,519,445











Other Assets









Advances to suppliers



453,300




2,109,005


Manufacturing rebate receivable



9,112,321




9,269,118


Intangible assets, net



15,434,782




15,976,144


Goodwill



8,849,647




9,001,924


Long-term investment



18,132,000




-


Non-current assets from discontinued operations



8,925,337




9,367,205


Total Assets


$

131,273,377



$

138,487,726











Liabilities and Equity









Current Liabilities









Short-term bank loans


$

5,120,779



$

5,208,893


Bank acceptance notes payable



4,191,514




6,975,526


Accounts payable



2,971,819




5,543,226


Due to related parties



4,277,401




2,995,228


Customer deposits



1,282,773




1,046,105


Taxes payable



213,658




542,267











Due to third parties



696,873




708,864


Accrued liabilities and other payables



1,355,504




1,581,618


Current liabilities from discontinued operations



1,825,711




2,187,535


Total current liabilities



21,936,032




26,789,262


Deferred tax liability



2,050,797




2,086,086


Total liabilities



23,986,829




28,875,348











Equity









Common shares, $0.001 par value, 50,000,000 shares authorized,
28,703,242 shares issued and outstanding at June 30, 2018 and
December 31, 2017



28,703




28,703


Additional paid-in capital



39,067,328




39,067,328


Statutory reserves



6,461,788




6,461,788


Retained earnings



58,349,698




56,356,369


Accumulated other comprehensive loss



(5,032,481)




(1,101,270)


Total Shareholders' Equity



98,875,036




100,812,918


Noncontrolling interest



8,411,512




8,799,460


Total Equity



107,286,548




109,612,378


Total Liabilities and Equity


$

131,273,377



$

138,487,726


 

 

Tantech Holdings Ltd and Subsidiaries

 Condensed Consolidated Statements of Comprehensive Income (Loss)

(Unaudited)




For the Six Months Ended June 30,




2018



2017


Revenues


$

15,986,214



$

12,445,058


Cost of revenues



13,363,599




10,448,983


Gross Profit



2,622,615




1,996,075











Operating expenses









Selling expenses



385,525




231,740


General and administrative expenses



1,518,991




1,804,020


Research and development expenses



122,377




75,864


Total operating expenses



2,026,893




2,111,624











Income (loss) from operations



595,722




(115,549)











Other income (expenses)









Interest income



38,272




6,070


Interest expense



(331,993)




(88,115)


Other income, net



200,176




9,454


Total other expenses



(93,545)




(72,591)











Income (loss) before income taxes provision



502,177




(188,140)











Provision for income taxes



372,980




422,582











Net income (loss) from continuing operations



129,197




(610,722)











Discontinued operation:









Net income from discontinued operations, net of income tax



1,460,779




921,481


Net income



1,589,976




310,759











Less: Net loss attributable to the noncontrolling interest from
continuing operations



(403,353)




-


Net income attributable to common shareholders of
Tantech Holding Inc.


$

1,993,329



$

310,759











Net income



1,589,976




310,759











Other comprehensive income (loss):









Foreign currency translation gains (loss)



(3,915,806)




1,501,819


Comprehensive income (loss)



(2,325,830)




1,812,578











Less: Comprehensive loss attributable to noncontrolling
interest



(387,948)




-











Comprehensive income (loss) attributable to common
shareholders of Tantech Holding Inc.


$

(1,937,882)



$

1,812,578











Earnings per share -Basic and Diluted


$

0.07



$

0.01


Weighted Average Shares Outstanding - Basic and Diluted



28,703,242




24,311,935


 

 

Tantech Holdings Ltd and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited)




For the Six Months Ended




June 30,




2018



2017


Cash flows from operating activities









Net income


$

1,589,976



$

310,759


Net income from discontinued operations



1,460,779




921,481


Net income (loss) from continuing operations



129,197




(610,722)


Adjustments to reconcile net income to net cash
    provided by (used in) operating activities from continuing
    operations:









Allowance for doubt accounts - accounts receivable



-




259,169


Allowance for doubt accounts - advances to suppliers



-




743,394


Depreciation expense



59,872




195,023


Amortization of intangible asset



284,666




3,305


Changes in operating assets and liabilities:









Accounts receivable



10,487,847




4,732,728


Advances to suppliers



9,275,591




1,402,617


Inventory



150,486




(956,878)


Other receivables



764,156




(42,704)


Accounts payable



(2,576,022)




2,559,059


Customer deposits



264,465




114,617


Taxes payable



(965,703)




(336,659)


Accrued liabilities and other payables



(211,338)




917,971


Net cash provided by continuing operations



17,663,217




8,980,920


Net cash provided by (used in) discontinued operations



5,315,118




(629,730)


Net cash provided by operating activities



22,978,335




8,351,190











Cash flows from investing activities









Addition of property, plant and equipment



(2,268)




(13,514)


Additions to intangible assets



(2,792)




-


Long term investment



(18,852,000)




-


Deposit for business acquisition



-




(4,409,435)


Net cash used in continuing operations



(18,857,060)




(4,422,949)


Net cash provided by (used in) discontinued operations



(802,821)




15,401


Net cash used in investing activities



(19,659,881)




(4,407,548)











Cash flows from financing activities









Repayments of bank loans



-




(305,456)


Notes receivables



15,710




-


Repayments of bank acceptance notes payable



(2,771,877)




(290,910)


Repayment of loans from third party



-




(418,910)


Borrowings from related parties



1,385,765




-


Net cash used in continuing operations



(1,370,402)




(1,015,276)


Net cash provided by (used in) discontinued operations



-




-


Net cash used in financing activities



(1,370,402)




(1,015,276)











Effect of exchange rate changes on cash, cash equivalents and
restricted cash



(2,172,790)




(158,923)











Net (decrease) increase in cash, cash equivalents and restricted
cash



(224,738)




2,769,443











Cash, cash equivalents and restricted cash, beginning of period



13,637,817




6,271,096











Cash, cash equivalents and restricted cash, end of period


$

13,413,079



$

9,040,539


Less: Cash, cash equivalents and restricted cash from
discontinued operations



(57,887)




(12,858)


Cash, cash equivalents and restricted cash from continuing
operations, end of period


$

13,355,192



$

9,027,681











Supplemental disclosure information:









Income taxes paid


$

678,227



$

-


Interest paid


$

160,714



$

-


 

 

Cision

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