Revenue up 697% Year-over-year
SHENZHEN, China, Nov. 15, 2021 /PRNewswire/ -- TD Holdings, Inc. (Nasdaq: GLG) (the "Company"), a commodities trading service provider in China, today announced its financial results for the third quarter ended September 30, 2021.
Ms. Renmei Ouyang, the Chief Executive Officer of the Company, stated, "We are pleased to report our financial results for the third quarter of fiscal year 2021. Our revenue increased by 697% to $54.77 million for the third quarter of fiscal year 2021 as compared to the same quarter of last year. During the third quarter, we have entered into a new strategic alliance with Jinyibao International Technology Company Limited to step into the global gold spot trading market, which is expected to enrich our commodity trading platforms, expand the scale of the platforms, and open up a new profit growth point. We have also established a partnership with Guangzhou Wensheng Blockchain Technology Co., Ltd. to target the tremendous market potential of blockchain in the supply chain financing and digital cloud warehouse business. In addition, we have entered into strategic cooperation with Guangdong Enterprise Investment Promotion Association to develop our lightweight new materials business. Looking forward, we believe these moves will allow us to execute our lead strategy and effectively drive long-term growth."
Financial Highlights
In the quarter ended September 30, 2021
- Revenue from commodities trading business was $54.77 million, consisting of $52.73 million from sales of commodities products, and $2.04 million from supply chain management services for the quarter ended September 30, 2021, an increase of 697% from $6.87 million for the same quarter ended September 30, 2020.
- Net income from continuing operation was $0.46 million, as compared with $3.54 million for the same quarter ended September 30, 2020. Net income was $0.46 million, as compared with $0.55 million for the same quarter ended September 30, 2020.
- Basic and diluted earnings per share from continuing operations was $nil, compared with $0.06 for the same quarter ended September 30, 2020. Basic and diluted earnings per share was $nil, compared with $0.01 for the same period ended September 30, 2020.
In the nine months ended September 30, 2021
- Revenue from commodities trading business was $144.20 million, consisting of $141.68 million from sales of commodities products, and $2.52 million from supply chain management services for the nine months ended September 30, 2021, an increase of 1339% from $10.02 million for the same period ended September 30, 2020.
- Net loss from continuing operation was $0.72 million, as compared with $1.73 million for the same period ended September 30, 2020. Net loss was $0.72 million, as compared with $5.27 million for the same period ended September 30, 2020.
- Basic and diluted loss per share from continuing operations was $0.01, compared with $0.03 for the same period ended September 30, 2020. Basic and diluted loss per share was $0.01, compared with $0.12 for the same period ended September 30, 2020.
Financial Results
In the three months ended September 30, 2021
Revenues
For the three months ended September 30, 2021, the Company sold non-ferrous metals to twelve customers at fixed prices, and earned revenues when the product ownership was transferred to its customers. The Company earned revenues of $52.73 million from sales of commodity products for the three months ended September 30, 2021, among which, $1.37 million generated from the related party, compared with $0.96 million from sales of commodity products for the three months ended September 30, 2020.
For the three months ended September 30, 2021, the Company earned commodity distribution commission fees of $2.04 million from twenty-two third-party customers and the Company earned commodity distribution commission fees of $1.15 million and $2.04 million from facilitating such sales transactions with three third party customers and three related party customers for the three months ended September 30, 2020.
Cost of revenue
Cost of revenue primarily consists of purchase costs of non-ferrous metal products. For the three months ended September 30, 2021, the Company purchased non-ferrous metal products of $51.36 million from eleven third party vendors and $1.43 million from one related party vendors, compared with $3.61 million from two related party vendors for the three months ended September 30, 2020.
Selling, general, and administrative expenses
Selling, general and administrative expenses increased by $1.93 million or 622%, to $2.23 million for the three months ended September 30, 2021, from $0.29 million for the three months ended September 30, 2020. Selling, general and administrative expenses primarily consisted of salary and employee benefits, office rental expense, amortizations of intangible assets and convertible notes, professional service fees and finance offering related fees. The increase was mainly attributable to amortization of intangible assets of $1.01 million and amortization of convertible notes of $0.19 million for the three months ended September 30,2021 while no such issuance for the three months ended September 30, 2020.
Interest income
Interest income was primarily generated from loans made to third parties and related parties. Interest income decreased by $0.03 million or 1%, to $1.81 million for the three months ended September 30, 2021, from $1.84 million for the three months ended September 30, 2020.
Net income from continuing operations
Net income from continuing operations was $0.46 million for the three months ended September 30, 2021, compared with $3.54 million for the three months ended September 30, 2020.
Net income
Net income was $0.46 million for the three months ended September 30, 2021, compared with $0.55 million for the three months ended September 30, 2020.
In the nine months ended September 30, 2021
Revenues
For the nine months ended September 30, 2021, the Company sold non-ferrous metals to three related party customers and twenty-one third party customers at fixed prices, and earned revenues when the product ownership was transferred to its customers. The Company earned revenues of $141.68 million from sales of commodity products for the nine months ended September 30, 2021, compared with $6.30 million for the nine months ended September 30, 2020.
For the nine months ended September 30, 2021, the Company earned commodity distribution commission fees of $2.52 million from third party vendors, compared with commission fees of $2.11 million from six third party customers and distribution service fees of $1.61 million from three related party customer for the nine months ended September 30, 2020.
Cost of revenue
Cost of revenue primarily consists of purchase costs of non-ferrous metal products. For the nine months ended September 30, 2021, the Company purchased non-ferrous metal products of $118.32 million from twenty-one third party vendors and $23.35 million from eight related party vendors, compared with $1.46 million from one third party vendor and $4.87 million from three related party vendors for the nine months ended September 30, 2020.
Selling, general, and administrative expenses
Selling, general and administrative expenses increased by $4.82 million or 467%, to $5.85 million for the nine months ended September 30, 2021, from $1.03 million for the nine months ended September 30, 2020. Selling, general and administrative expenses primarily consisted of salary and employee benefits, office rental expense, amortizations of intangible assets and convertible notes, professional service fees and finance offering related fees. The increase was mainly attributable to amortization of intangible assets of $2.91 million and amortization of convertible notes of $0.35 million for the nine months ended September 30, 2021 while no such issuance for the three months ended September 30, 2020.
Interest income
Interest income was primarily generated from loans made to third parties and related parties. Interest income increased by $3.12 million or 83%, to $6.85 million for the nine months ended September 30, 2021, from $3.74 million for the nine months ended September 30, 2020. The increase was primarily due to loans made to Yunfeihu for the three months ended September 30, 2021, for the nine months ended September 30, 2021, $3.80 million was attributed to related party and $3.06 million was generated from third party vendors.
Share-based payment for service
On March 4, 2021, the Company issued 750,000 fully-vested warrants with an exercise price of $0.01, with a five-year life, to an agent who was engaged to complete the warrant waiver and exercise agreements. The Company applied Black-Scholes model and determined the fair value of the warrants to be $1,695,042. Significant estimates and assumptions used included stock price on March 4, 2021 of $2.27 per share, risk-free interest rate of one year of 0.08%, life of 5 years, and volatility of 71.57% for the nine months ended September 30, 2021.
On July 16, 2021, the Company issued 140,000 shares of the Company's common stock as compensation to a PR service provider for increasing the Company's visibility in the financial news community, and recognized 141,400 Share-based payment for service to profit.
For the nine months ended September 30, 2020, no such expenses incurred.
Amortization of beneficial conversion feature and relative fair value of warrants relating to issuance of convertible notes
For the nine months ended September 30, 2021, the item represented the amortization of beneficial conversion feature of $619,025 of the two convertible notes issued on January 6, 2021 and on March 4, 2021.
For the nine months ended September 30, 2020, the item represented the full amortization of beneficial conversion feature of $3.4 million and amortization of relative fair value of warrants of $3.06 million relating to the convertible notes which was exercised in May 2020.
Net loss from continuing operations
Net loss from continuing operations was $0.72 million for the nine months ended September 30, 2021, compared with $1.73 million for the nine months ended September 30, 2020.
Net loss
Net loss from was $0.72 million for the nine months ended September 30, 2021, compared with $5.27 million for the nine months ended September 30, 2020.
Nine months Ended September 30, 2021 Cash Flows
As of September 30, 2021, the Company had cash and cash equivalents of $4.29 million, as compared with $2.70 million as of December 31, 2020.
Net cash provided by operating activities from continuing operations was $0.94 million for the nine months ended September 30, 2021, compared with $3.07 million for the nine months ended September 30, 2020. Net cash provided by operating activities was $0.94 million for the nine months ended September 30, 2021, compared with $2.37 million for the nine months ended September 30, 2020.
Net cash used in investing activities was $62.21 million for the nine months ended September 30, 2021, compared with $83.14 million for the nine months ended September 30, 2020.
Net cash provided by financing activities was $62.13 million for the nine months ended September 30, 2021, compared with $81.05 million the nine months ended September 30, 2020.
About TD Holdings, Inc.
TD Holdings, Inc. is a service provider currently engaging in commodity trading business and supply chain service business in China. Its commodities trading business primarily involves purchasing non-ferrous metal product from upstream metal and mineral suppliers and then selling to downstream customers. Its supply chain service business primarily has served as a one-stop commodity supply chain service and digital intelligence supply chain platform integrating upstream and downstream enterprises, warehouses, logistics, information, and futures trading. For more information, please visit http://ir.tdglg.com.
Safe Harbor Statement
This press release may contain certain "forward-looking statements" relating to the business of TD Holdings, Inc. and its subsidiary companies. All statements, other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties. Although the Company believes that the expectations reflected in these forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. The following factors, among others, could cause actual results to differ materially from those described in these forward-looking statements: there is uncertainty about the spread of the COVID-19 virus and the impact it will have on the Company's operations, the demand for the Company's products and services, global supply chains and economic activity in general. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. Investors should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of factors, including those discussed in the Company's periodic reports that are filed with the Securities and Exchange Commission and available on its website at http://www.sec.gov. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
For more information, please contact:
Ascent Investor Relations LLC
Ms. Tina Xiao
Email:[email protected]
Tel: +1 917 609 0333
TD HOLDINGS, INC. | ||||||||
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS | ||||||||
September 30, | December 31, | |||||||
ASSETS | ||||||||
Current Assets | ||||||||
Cash | $ | 4,291,390 | $ | 2,700,013 | ||||
Loans receivable from third parties | 103,932,909 | 18,432,691 | ||||||
Due from related parties | 12,083,999 | 55,839,045 | ||||||
Other current assets | 6,742,586 | 1,310,562 | ||||||
Total current assets | 127,050,884 | 78,282,311 | ||||||
Property and equipment, net | 2,266 | - | ||||||
Goodwill | 69,826,845 | 69,322,325 | ||||||
Intangible assets | 21,905,533 | 19,573,846 | ||||||
Total noncurrent assets | 91,734,644 | 88,896,171 | ||||||
Total Assets | $ | 218,785,528 | $ | 167,178,482 | ||||
LIABILITIES AND EQUITY | ||||||||
Current Liabilities | ||||||||
Advances from customers | $ | 8,255,056 | $ | 9,214,369 | ||||
Bank borrowings | 1,110,186 | 1,653,247 | ||||||
Third party loans payable | 462,185 | - | ||||||
Due to related parties | 22,878 | 7,346,021 | ||||||
Income tax payable | 7,571,307 | 5,460,631 | ||||||
Other current liabilities | 3,820,365 | 3,197,147 | ||||||
Convertible notes | 2,574,624 | - | ||||||
Acquisition payable | - | 15,384,380 | ||||||
Total current liabilities | 23,816,601 | 42,255,795 | ||||||
Deferred tax liabilities | 4,312,941 | 4,893,461 | ||||||
Total noncurrent liabilities | 4,312,941 | 4,893,461 | ||||||
Total liabilities | 28,129,542 | 47,149,256 | ||||||
Equity (Deficit) | ||||||||
Common stock (par value $0.001 per share, 100,000,000 shares authorized; | 134,913 | 79,131 | ||||||
Statutory reserve | 913,292 | 913,292 | ||||||
Additional paid-in capital | 222,683,671 | 151,407,253 | ||||||
Accumulated deficit | (41,418,576) | (39,255,945) | ||||||
Accumulated other comprehensive income | 8,342,686 | 6,885,495 | ||||||
Total Equity | 190,655,986 | 120,029,226 | ||||||
Total Liabilities and Equity | $ | 218,785,528 | $ | 167,178,482 | ||||
TD HOLDINGS, INC. | ||||||||||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND | ||||||||||||||||
COMPREHENSIVE INCOME (LOSS) | ||||||||||||||||
(Expressed in U.S. dollars, except for the number of shares) | ||||||||||||||||
For the Three Months Ended | For the Nine Months Ended | |||||||||||||||
2021 | 2020 | 2021 | 2020 | |||||||||||||
Revenues | ||||||||||||||||
Commodity products - related parties | $ | 1,365,823 | $ | 958,108 | $ | 23,292,454 | $ | 3,575,409 | ||||||||
Commodity products - third parties | 51,364,489 | 2,722,836 | 118,387,337 | 2,722,836 | ||||||||||||
Supply chain management services - related parties | - | 2,041,570 | - | 2,112,166 | ||||||||||||
Supply chain management services - third parties | 2,043,494 | 1,148,839 | 2,515,919 | 1,609,469 | ||||||||||||
Total Revenues | 54,773,806 | 6,871,353 | 144,195,710 | 10,019,880 | ||||||||||||
Cost of revenue | ||||||||||||||||
Commodity product sales - related parties | (1,429,486) | (3,609,639) | (23,347,003) | (4,865,857) | ||||||||||||
Commodity product sales - third parties | (51,358,653) | (88,543) | (118,323,668) | (1,458,212) | ||||||||||||
Supply chain management services - third parties | (11,913) | (16,463) | (15,555) | (24,417) | ||||||||||||
Total Cost of revenue | (52,800,052) | (3,714,645) | (141,686,226) | (6,348,486) | ||||||||||||
Gross profit | 1,973,754 | 3,156,708 | 2,509,484 | 3,671,394 | ||||||||||||
Operating expenses | ||||||||||||||||
Selling, general, and administrative expenses | (2,226,398) | (292,080) | (5,851,131) | (1,032,660) | ||||||||||||
Share-based payment for service | (141,400) | - | (1,836,442) | - | ||||||||||||
Total operating expenses | (2,367,798) | (292,080) | (7,687,573) | (1,032,660) | ||||||||||||
Other income (expenses), net | ||||||||||||||||
Interest income | 1,809,398 | 1,836,016 | 6,854,491 | 3,736,079 | ||||||||||||
Interest expenses | 100,294 | (15,164) | (182,954) | (69,644) | ||||||||||||
Amortization of beneficial conversion feature relating | (619,025) | - | (619,025) | (3,400,000) | ||||||||||||
Amortization of relative fair value of warrants relating | - | - | - | (3,060,000) | ||||||||||||
Other income (expense), net | 251,014 | - | (135,344) | - | ||||||||||||
Total other income (expenses), net | 1,541,681 | 1,820,852 | 5,917,168 | (2,793,565) | ||||||||||||
Net income (loss) from continuing operations before income taxes | 1,147,637 | 4,685,480 | 739,079 | (154,831) | ||||||||||||
Income tax expenses | (690,022) | (1,149,563) | (1,461,884) | (1,573,531) | ||||||||||||
Net income (loss) from continued operations, net of tax | 457,615 | 3,535,917 | (722,805) | (1,728,362) | ||||||||||||
Net loss from discontinued operations, net of tax | - | (2,989,116) | - | (3,541,807) | ||||||||||||
Net income (loss) | 457,615 | 546,801 | (722,805) | (5,270,169) | ||||||||||||
Less: Net loss attributable to non-controlling interests | - | - | - | 7,073 | ||||||||||||
Net income (loss) attributable to TD Holdings, Inc.'s Stockholders | $ | 457,615 | $ | 546,801 | $ | (722,805) | $ | (5,263,096) | ||||||||
Comprehensive Income (Loss) | ||||||||||||||||
Net income(loss) | $ | 457,615 | $ | 546,801 | $ | (722,805) | $ | (5,270,169) | ||||||||
Foreign currency translation adjustment | (605,379) | 3,515,011 | 1,457,191 | 3,427,039 | ||||||||||||
Comprehensive income (loss) | $ | (147,764) | $ | 4,061,812 | $ | 734,386 | $ | (1,843,130) | ||||||||
Less: Total comprehensive loss attributable to non-controlling interests | - | - | - | 7,073 | ||||||||||||
Comprehensive income (loss) attributable to TD Holdings, Inc. | $ | (147,764) | $ | 4,061,812 | $ | 734,386 | $ | (1,836,057) | ||||||||
Earnings (loss) per share- basic | 0.00 | 0.01 | (0.01) | (0.12) | ||||||||||||
Earnings (loss) per share- diluted | 0.00 | 0.01 | (0.01) | (0.12) | ||||||||||||
Earnings (loss) per share continuing - basic and diluted | 0.00 | 0.06 | (0.01) | (0.03) | ||||||||||||
Earnings (loss) per share discontinued - basic and diluted | - | (0.05) | - | (0.09) | ||||||||||||
Weighted Average Shares Outstanding-Basic | 102,091,312 | 58,625,143 | 97,406,331 | 43,695,789 | ||||||||||||
Weighted Average Shares Outstanding-Diluted | 108,621,947 | 58,625,143 | 103,936,966 | 43,695,789 | ||||||||||||
TD HOLDINGS, INC. | ||||||||
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||||||||
(Expressed in U.S. dollar) | ||||||||
For the Nine Months | ||||||||
2021 | 2020 | |||||||
Cash Flows from Operating Activities: | ||||||||
Net (loss) income | $ | (722,805) | $ | (5,270,169) | ||||
Net loss from discontinued operations | - | 3,541,807 | ||||||
Net (loss) income from continuing operations | (722,805) | (1,728,362) | ||||||
Adjustments to reconcile net loss to net cash used in operating activities: | ||||||||
Depreciation of property and equipment | 331 | - | ||||||
Amortization of right of use assets | - | 222,840 | ||||||
Amortization of intangible assets | 2,905,932 | - | ||||||
Amortization of beneficial conversion feature of convertible notes | 354,000 | - | ||||||
Interest expense for convertible notes | 300,108 | - | ||||||
Standstill fee relating to convertible notes | 356,934 | - | ||||||
Deferred tax liabilities | (617,582) | - | ||||||
Share-based payment for service | 1,836,442 | - | ||||||
Amortization of beneficial conversion feature relating to issuance of convertible notes | 619,025 | 3,400,000 | ||||||
Amortization of relative fair value of warrants relating to issuance of convertible notes | - | 3,060,000 | ||||||
Changes in operating assets and liabilities: | ||||||||
Other current assets | 1,268,574 | (139,114) | ||||||
Escrow account receivable | - | (369,552) | ||||||
Prepayments | - | (5,282,703) | ||||||
Due from related parties | (385,132) | - | ||||||
Due from third parties | (1,589,463) | - | ||||||
Advances from customers | (1,028,785) | 1,843,990 | ||||||
Due to related parties | (5,497,309) | 296,611 | ||||||
Income tax payable | 2,070,616 | 1,573,531 | ||||||
Other current liabilities | 607,774 | 439,422 | ||||||
Lease liabilities | - | (244,104) | ||||||
Due to third party loans payable | 463,271 | - | ||||||
Net Cash Used in Operating Activities from continuing operations | 941,931 | 3,072,559 | ||||||
Net Cash Used in Operating Activities from discontinued operations | - | (700,039) | ||||||
Net Cash Used in Operating Activities | 941,931 | 2,372,520 | ||||||
Cash Flows from Investing Activities: | ||||||||
Purchases of intangible assets | (5,100,306) | - | ||||||
Purchases of property and equipment | (2,603) | - | ||||||
Final payment of acquisition of a subsidiary | (15,532,750) | - | ||||||
Payment made on loans to related parties | - | (4,826,640) | ||||||
Payment made on loans to third parties | (99,030,244) | (157,087,880) | ||||||
Collection of loans from third parties | 13,463,633 | 74,999,934 | ||||||
Collection of loans from related parties | 44,399,732 | 3,404,953 | ||||||
Investments in other investing activities | (410,536) | - | ||||||
Net Cash Used in Investing Activities from continuing operations | (62,213,074) | (83,509,633) | ||||||
Net Cash Used in Investing Activities from discontinued operations | - | 368,612 | ||||||
Net Cash Used in by Investing Activities | (62,213,074) | (83,141,021) | ||||||
Cash Flows from Financing Activities: | ||||||||
Proceeds from third party borrowings | - | 1,558,595 | ||||||
Repayments of borrowings to related parties | (1,896,122) | - | ||||||
Payments of borrowings to the third parties | (556,397) | - | ||||||
Proceeds from issuance of common stock under ATM | 2,192,989 | - | ||||||
Proceeds from issuance of common stock under private placement transactions | 57,877,941 | 13,500,000 | ||||||
Proceeds from convertible promissory notes | 4,500,000 | 30,000,000 | ||||||
Proceeds from exercise of warrants | 7,500 | 36,369,552 | ||||||
Net Cash Used in Financing Activities from continuing operations | 62,125,911 | 81,428,147 | ||||||
Net Cash Used in Financing Activities from discontinued operations | - | (381,554) | ||||||
Net Cash Used in by Financing Activities | 62,125,911 | 81,046,593 | ||||||
Effect of exchange rate changes on cash and cash equivalents | 736,609 | 912,189 | ||||||
Net increase(decrease) in cash and cash equivalents | 1,591,377 | 1,190,281 | ||||||
Cash at beginning of period | 2,700,013 | 1,777,276 | ||||||
Cash at end of period | $ | 4,291,390 | $ | 2,967,557 | ||||
Supplemental Cash Flow Information | ||||||||
Cash paid for interest expense | $ | - | $ | - | ||||
Cash paid for income tax | $ | 75,416 | $ | - | ||||
Supplemental disclosure of Non-cash investing and financing activities | ||||||||
Right-of-use assets obtained in exchange for operating lease obligations | $ | - | $ | 455,635 | ||||
Issuance of common stocks in connection with private placements, net of issuance | $ | - | $ | 1,600,000 | ||||
Issuance of common stocks in connection with conversion of convertible notes | $ | - | $ | 30,000,000 | ||||
Issuance of common stocks in connection with private placements, net of issuance | $ | - | $ | 5,000,000 | ||||
Issuance of common stocks in connection with cashless exercise of 1,502,022 warrants | $ | - | $ | 868,530 | ||||
Issuance of common stocks in connection with warrant cashless exercise in March 2021 | $ | 1,439,826 | $ | - | ||||
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SOURCE TD Holdings, Inc.