Niu Technologies Announces Fourth Quarter and Full Year 2020 Financial Results

Chaoyang District, CHINA


-- Fourth Quarter Total volume of e-scooter sales up 41.6% year over year

-- Fourth Quarter Revenues of RMB 672.0 million, up 25.3% year over year

-- Fourth Quarter Net income of RMB 58.2 million, compared with RMB 60.7 million in the fourth quarter of last year

-- Full Year Total volume of e-scooter sales up 42.8% year over year

-- Full Year Revenues of RMB 2,444.3 million, up 17.7% year over year

-- Full Year Net income of RMB 168.7 million, compared with net income of RMB 190.1 million in 2019

BEIJING, March 08, 2021 (GLOBE NEWSWIRE) -- Niu Technologies (“NIU”, or “the Company”) (NASDAQ: NIU), the world’s leading provider of smart urban mobility solutions, today announced its financial results for the fourth quarter and full year ended December 31, 2020.

Fourth Quarter 2020 Financial Highlights

  • Revenues were RMB 672.0 million, an increase of 25.3% year over year
  • Gross margin was 25.2%, compared with 26.1% in the fourth quarter of last year
  • Net income was RMB 58.2 million, compared with RMB 60.7 million in the fourth quarter of last year
  • Adjusted net income (non-GAAP)1 was RMB 68.6 million, compared with RMB 68.5 million in the fourth quarter of last year

Fourth Quarter 2020 Operating Highlights

  • The number of e-scooters sold reached 150,465, up 41.6% year over year
  • The number of e-scooters sold in China reached 137,586, up 35.0% year over year
  • The number of e-scooters sold in the international markets reached 12,879, up 197.1% year over year
  • The number of franchised stores in China was 1,616, an increase of 350 since September 30, 2020
  • International sales network expanded to 36 distributors covering 46 countries

Dr. Yan Li, Chief Executive Officer of the Company, commented: “Our international markets sales volume increased by 197% year over year. We are very pleased to see the strong sales growth in the international markets despite the rebound of COVID-19. In China, we continued to expand retail sales network and opened 350 stores during the fourth quarter. In 2021, we plan to launch new products in domestic and international markets and provide more offerings to our customers. We will also accelerate the retail network expansion and penetrate further into the lower-tier cities in China. We are very excited about the growth prospective of our business and look forward to the continued growth.”

Fourth Quarter 2020 Financial Results

Revenues were RMB 672.0 million, an increase of 25.3% year over year, due to higher sales volume of 41.6%, partially offset by decreased revenues per e-scooter of 11.5%. The following table shows the revenues breakdown and revenues per e-scooter in the periods presented:

Revenues
(in RMB million)
 2020
Q4
 2019
Q4
 % change
YoY
E-scooter sales from China market 461.7 406.0 +13.7%
E-scooter sales from international markets 115.6 43.0 +168.8%
E-scooter sales, sub-total 577.3 449.0 +28.6%
Accessories, spare parts and services 94.7 87.1 +8.7%
Total 672.0 536.1 +25.3%


Revenues per e-scooter
(in RMB)
 2020
Q4
 2019
Q4
 % change
YoY
E-scooter sales from China market2 3,355 3,983 -15.8%
E-scooter sales from international markets2 8,979 9,924 -9.5%
E-scooter sales 3,837 4,226 -9.2%
Accessories, spare parts and services3 629 820 -23.3%
Revenues per e-scooter 4,466 5,046 -11.5%
  • E-scooter sales revenues from China market were RMB 461.7 million, an increase of 13.7%, and represented 80.0% of total e-scooter revenues. The increase was mainly driven by retail network expansion and new product launches in China.
  • E-scooter sales revenues from international markets were RMB 115.6 million, an increase of 168.8%, and represented 20.0% of total e-scooter revenues. The increase was mainly driven by higher sales volume in the international markets.
  • Accessories, spare parts sales and service revenues were RMB 94.7 million, an increase of 8.7% and represented 14.1% of total revenues. The increase was mainly due to higher sales from China market.
  • Decreased revenues per e-scooter was mainly driven by the sales of new product G0 which has a lower sales price compared with other models, higher sales volume rebate to distributors and lower revenues per e-scooter from accessories, spare parts and services as a result of decrease in accessories and spare parts sales from international markets.

Cost of revenues was RMB 502.9 million, an increase of 27.0% year over year, mainly due to higher e-scooter sales volume. The cost per e-scooter, defined as cost of revenues divided by the number of e-scooters sold in a specified period, was RMB 3,343, down 10.3% from RMB 3,726 in the fourth quarter 2019 mainly due to change in product mix and lower raw materials cost.

Gross margin was 25.2%, compared with 26.1% in the same period of 2019. The decrease was mainly due to higher sales volume rebate to distributors and unfavorable change in product mix, partially offset by cost savings.

Operating expenses were RMB 119.9 million, an increase of 27.3% from the same period of 2019. Operating expenses as a percentage of revenues was 17.8%, compared with 17.6% in the fourth quarter of 2019.

  • Selling and marketing expenses were RMB 60.1 million (including RMB 2.7 million of share-based compensation), an increase of 23.1% from RMB 48.9 million in the fourth quarter of 2019. The increase was mainly due to the increase in advertising and promotion expense of RMB 9.5 million, the increase in staff cost of RMB 4.5 million, the increase in depreciation and amortization expense of RMB 1.4 million which was due to opening of new franchised stores, and the increase of share-based compensation expenses of RMB 1.1 million. The higher expenses were partially offset by the decrease of traveling and rental expense of RMB 2.2 million and the decrease in product certification fee of RMB 2.0 million. Selling and marketing expenses as a percentage of revenues was 9.0% compared with 9.1% in the fourth quarter of 2019.
  • Research and development expenses were RMB 29.7 million (including RMB 2.8 million of share-based compensation), an increase of 55.7% from RMB 19.1 million in the fourth quarter of 2019, mainly due to the increase in staff cost of RMB 4.1 million, the increase in design expense of RMB 3.9 million due to more new product development, and the increase in share-based compensation expenses of RMB 0.9 million. Research and development expenses as a percentage of revenues was 4.4%, compared with 3.6% in the fourth quarter of 2019.
  • General and administrative expenses were RMB 30.1 million (including RMB 4.7 million of share-based compensation), an increase of 14.5% from RMB 26.3 million in the fourth quarter of 2019, mainly due to the increase in foreign currency exchange loss of RMB 3.1 million, the increase in office expense of RMB 2.4 million, the increase in rental, depreciation and amortization expense of RMB 1.5 million, and the increase in share-based compensation expenses of RMB 0.6 million. The higher expenses were partially offset by the decrease of provision for bad debt of RMB 3.0 million and the decrease of professional fees of RMB 0.7 million. General and administrative expenses as a percentage of revenues was 4.5%, compared with 4.9% in the fourth quarter of 2019.

Operating expenses excluding share-based compensation were RMB 109.7 million, increased by 26.8% year over year, and represented 16.3% of revenues, compared with 16.1% in the fourth quarter of 2019.

  • Selling and marketing expenses excluding share-based compensation were RMB 57.5 million, an increase of 21.6% year over year, and represented 8.6% of revenues, compared with 8.8% in the fourth quarter of 2019.
  • Research and development expenses excluding share-based compensation were RMB 26.9 million, an increase of 56.8% year over year, and represented 4.0% of revenues, compared with 3.2% in the fourth quarter of 2019.
  • General and administrative expenses excluding share-based compensation were RMB 25.4 million, an increase of 14.7% year over year, and represented 3.8% of revenues, compared with 4.1% in the fourth quarter of 2019.

Government grants were RMB 13.2 million, decreased by RMB 0.2 million from the same period of 2019.

Share-based compensation was RMB 10.4 million, an increase of RMB 2.6 million from the same period of 2019.

Income tax expense was RMB 13.6 million, an increase of RMB 13.1 million from the same period of 2019.

Net income was RMB 58.2 million, compared with RMB 60.7 million in the fourth quarter of 2019. The net income margin was 8.7%, compared with 11.3% in the same period of 2019.

Adjusted net income (non-GAAP) was RMB 68.6 million, compared with RMB 68.5 million in the fourth quarter of 2019. The adjusted net income margin4 was 10.2%, compared with 12.8% in the same period of 2019.

Basic and diluted net income per ADS were RMB 0.76 (US$ 0.12) and RMB 0.73 (US$ 0.11), respectively.

Full Year 2020 Financial Results

Revenues were RMB 2,444.3 million, an increase of 17.7%, mainly driven by increases in e-scooter sales volume of 42.8%. China represented 86.7% of revenues from e-scooter sales, and overseas markets represented 13.3%. The following table shows the revenues breakdown and revenues per e-scooter in the periods presented:

Revenues
(in RMB million)
 2020
Full Year
 2019
Full Year
 % change
YoY
E-scooter sales from China market 1,857.3 1,520.3 +22.2%
E-scooter sales from international markets 286.0 267.0 +7.1%
E-scooter sales, sub-total 2,143.3 1,787.3 +19.9%
Accessories, spare parts and services 301.0 289.0 +4.2%
Total 2,444.3 2,076.3 +17.7%


Revenues per e-scooter
(in RMB)
 2020
Full Year
 2019
Full Year
 % change
YoY
E-scooter sales from China market2 3,246 3,874 -16.2%
E-scooter sales from international markets2 9,694 9,250 +4.8%
E-scooter sales 3,562 4,242 -16.0%
Accessories, spare parts and services3 500 686 -27.1%
Revenues per e-scooter 4,062 4,928 -17.6%

Cost of revenues were RMB 1,885.2 million, an increase of 18.6%, mainly driven by higher e-scooter sales volume. The cost per e-scooter, defined as cost of revenues divided by the number of e-scooters sold in a specified period, was RMB 3,133, down 17.0% from RMB 3,773 in 2019.

Gross margin was 22.9%, decreased from 23.4% in 2019, mainly driven by change in product mix.

Operating expenses were RMB 411.0 million, an increase of 24.7% from RMB 329.7 million in 2019. Operating expenses as a percentage of revenues was 16.8%, compared with 15.9% in 2019.

Operating expenses excluding share-based compensation were RMB 372.0 million, an increase of 19.9%, and represented 15.2% of revenues, compared with 14.9% in 2019.

Government grants were RMB 22.4 million, decreased by 7.4 million compared with the year of 2019.

Share-based compensation was RMB 39.6 million, an increase of RMB 20.0 million from RMB 19.6 million in 2019.

Income tax expense was RMB 21.1 million, an increase of RMB 12.9 million from the RMB 8.2 million in 2019.

Net income was RMB 168.7 million, a decrease of RMB 21.4 million from a net income of RMB 190.1 million in 2019. The net income margin was 6.9%, compared with 9.2% in 2019.

Adjusted net income (non-GAAP) was RMB 208.3 million, compared with an adjusted net income of RMB 209.7 million in 2019. The adjusted net income margin4 was 8.5% in 2020, compared with an adjusted net income margin of 10.1% in 2019.

Basic and diluted net income per ADS were RMB 2.24 (US$ 0.34) and RMB 2.14 (US$ 0.33) respectively.

Balance Sheet

As of December 31, 2020, the Company had cash and cash equivalents, term deposits and short-term investments of RMB 1,103.1 million in aggregate. The Company had restricted cash of RMB 168.5 million and short-term bank borrowings of RMB 180.0 million.

Business Outlook
NIU expects revenues of the first quarter 2021 to be in the range of RMB 420 million to RMB 478 million, representing a year-over-year increase of 80% to 105%. NIU expects the sales volume for full year 2021 to be in the range of 0.9 million to 1.1 million units, representing a year-over-year increase of 50% to 83%.

The above outlook is based on information available as of the date of this press release and reflects the Company’s current and preliminary expectation, which is subject to change in light of uncertainties and situations related to how COVID-19 develops.

Conference Call

The Company will host an earnings conference call on Monday, March 8, 2021 at 8:00 AM U.S. Eastern Time (9:00 PM Beijing/Hong Kong Time) to discuss its fourth quarter and full year 2020 financial and business results and provide a corporate update.

To join via phone, participants need to register in advance of the conference call using the link provided below. Upon registration, participants will receive dial-in numbers, an event passcode, and a unique registrant ID, which will be used to join the conference call.

Event:Niu Technologies Fourth Quarter and Full Year 2020 Earnings Conference Call 
Registration Link:http://apac.directeventreg.com/registration/event/9774698 
Conference ID:9774698 

A live and archived webcast of the conference call will be available on the investor relations website at https://ir.niu.com/news-and-events/webcasts-and-presentations.

A replay of the conference call can be accessed by phone two hours later at the following numbers until March 16, 2021.

United States+1-855-452-5696
International+61-281-990-299
Hong Kong800-963-117
Mainland China400-602-2065
Conference ID9774698

About NIU

As the world’s leading provider of smart urban mobility solutions, NIU designs, manufactures and sells high-performance electric bicycles and motorcycles. NIU has a product portfolio consisting of seven series, four e-scooter series, including NQi, MQi and UQi with smart functions and Gova, two urban commuter electric motorcycles series RQi and TQi, and a performance bicycle series, NIU Aero. Different series of products address the needs of different segments of modern urban residents and resolve the demands of different scenarios of urban travel, while being united through a common design language that emphasizes style, freedom and technology. NIU has adopted an omnichannel retail model, integrating the offline and online channels, to offer the products and services. For more information, please visit www.niu.com.

Use of Non-GAAP Financial Measures

To supplement NIU’s consolidated financial results presented in accordance with the accounting principles generally accepted in the United States of America (“GAAP”), NIU uses the following non-GAAP financial measures: adjusted net income and adjusted net income margin. The presentation of these non-GAAP financial measures is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with GAAP.

NIU believes that these non-GAAP financial measures provide meaningful supplemental information regarding its performance and liquidity by excluding certain items that may not be indicative of its operating results. The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing its performance and when planning and forecasting future periods. These non-GAAP financial measures also facilitate management’s internal comparisons to NIU’s historical performance. The Company believes these non-GAAP financial measures are useful to investors in allowing for greater transparency with respect to supplemental information used by management in its financial and operational decision making. A limitation of using these non-GAAP financial measures is that these non-GAAP measures exclude certain items that have been and will continue to be for the foreseeable future a significant component in the Company’s results of operations. These non-GAAP financial measures presented here may not be comparable to similarly titled measures presented by other companies. Other companies may calculate similarly titled measures differently, limiting their usefulness as comparative measures to the Company’s data.

Adjusted net income is defined as net income excluding share-based compensation expenses. Adjusted net income margin is defined as adjusted net income as a percentage of the revenues.

For more information on non-GAAP financial measures, please see the tables captioned “Reconciliation of GAAP and Non-GAAP Results.”

Exchange Rate

This announcement contains translations of certain RMB amounts into U.S. dollars (“US$”) at specified rates solely for the convenience of the readers. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB 6.5250 to US$ 1.00, the exchange rate in effect as of December 31, 2020, as set forth in the H.10 Statistical release of the Board of Governors of the Federal Reserve System. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor Statement

This press release contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as “will,” “expects,” “anticipates,” “aims,” “future,” “intends,” “plans,” “believes,” “estimates,” “likely to” and similar statements. Among other things, the business outlook and quotations from management in this announcement, as well as NIU’s strategic and operational plans, contain forward-looking statements. NIU may also make written or oral forward-looking statements in its periodic reports to the U.S. Securities and Exchange Commission, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about NIU’s beliefs, plans and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: NIU’s strategies; NIU’s future business development, financial condition and results of operations; NIU’s ability to maintain and enhance its “NIU” brand; its ability to innovate and successfully launch new products and services; its ability to maintain and expand its offline distribution network; its ability to satisfy the mandated safety standards relating to e-scooters; its ability to secure supply of components and raw materials used in e-scooters; its ability to manufacture, launch and sell smart e-scooters meeting customer expectations; its ability to grow collaboration with operation partners; its ability to control costs associated with its operations; general economic and business conditions in China and globally; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in NIU’s filings with the Securities and Exchange Commission. All information provided in this press release is as of the date of this press release, and NIU does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Investor Relations Contact:

Niu Technologies
Jason Yang
Investor Relations Manager
E-mail: ir@niu.com

 
NIU TECHNOLOGIES
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
      
 As of
 December 31, December 31, December 31,
 2019  2020  2020 
  RMB   RMB  US$
ASSETS     
Current assets     
Cash and cash equivalents279,945,942  227,004,137  34,789,906 
Term deposits174,404,554  130,498,000  19,999,693 
Restricted cash221,656,071  168,469,077  25,819,016 
Short-term investments310,439,321  745,608,877  114,269,560 
Accounts receivable, net115,228,700  101,320,063  15,527,979 
Inventories178,633,299  142,166,179  21,787,920 
Prepayments and other current assets30,982,131  32,832,088  5,031,738 
Total current assets 1,311,290,018    1,547,898,421    237,225,812  
      
Non-current assets     
Property and equipment, net150,891,344  199,045,061  30,504,990 
Intangible assets, net7,779,749  5,607,101  859,326 
Land use right, net34,355,936  48,835,120  7,484,310 
Deferred income tax assets-  14,593,376  2,236,533 
Other non-current assets6,522,561  30,830,304  4,724,951 
Total non-current assets 199,549,590    298,910,962    45,810,110  
      
Total assets 1,510,839,608    1,846,809,383    283,035,922  
      
LIABILITIES     
Current liabilities     
Short-term bank borrowings217,394,132  180,000,000  27,586,207 
Accounts payable258,988,264  395,826,435  60,663,055 
Income taxes payable3,013,805  14,555,094  2,230,666 
Advance from customers7,478,309  40,062,189  6,139,799 
Deferred revenue-current31,105,700  21,155,634  3,242,243 
Accrued expenses and other current liabilities175,533,397  171,657,604  26,307,679 
Total current liabilities 693,513,607    823,256,956    126,169,649  
      
Deferred revenue-non-current2,171,033  4,176,458  640,070 
Deferred income tax liability1,265,780  1,109,479  170,035 
Other non-current liabilities22,358,968  24,892,246  3,814,905 
Total non-current liabilities 25,795,781    30,178,183    4,625,010  
      
Total liabilities 719,309,388    853,435,139    130,794,659  
      
SHAREHOLDERS’ EQUITY:     
Class A ordinary shares84,494  87,300  13,379 
Class B ordinary shares11,977  11,202  1,717 
Additional paid-in capital1,738,102,741  1,801,940,071  276,159,398 
Accumulated other comprehensive loss(12,368,224) (43,016,027) (6,592,495)
Accumulated deficit(934,300,768) (765,648,302) (117,340,736)
Total shareholders’ equity 791,530,220    993,374,244    152,241,263  
      
Total liabilities and shareholders’ equity 1,510,839,608    1,846,809,383    283,035,922  
      


 
NIU TECHNOLOGIES
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
          
 Three months ended December 31, Year ended December 31,
 2019  2020 2019  2020
 RMB RMBUS$ RMB RMBUS$
Revenues536,106,506  671,989,578 102,986,909  2,076,289,101  2,444,328,764 374,609,772 
Cost of revenues(a)(395,945,845) (502,944,163)(77,079,565) (1,589,738,548) (1,885,180,256)(288,916,514)
Gross profit 140,160,661    169,045,415   25,907,344    486,550,553    559,148,508   85,693,258  
          
Operating expenses:         
Selling and marketing expenses(a)(48,879,563) (60,147,102)(9,217,947) (182,872,514) (200,761,383)(30,768,028)
Research and development expenses(a)(19,089,544) (29,723,694)(4,555,355) (67,187,348) (105,335,357)(16,143,350)
General and administrative expenses(a)(26,265,063) (30,078,909)(4,609,794) (79,615,561) (104,858,814)(16,070,316)
Total operating expenses (94,234,170)  (119,949,705) (18,383,096)  (329,675,423)  (410,955,554) (62,981,694)
Government grants13,462,650  13,239,121 2,028,984  29,833,770  22,441,492 3,439,309 
Operating income 59,389,141    62,334,831   9,553,232    186,708,900    170,634,446   26,150,873  
          
Interest expense(3,211,489) (1,770,944)(271,409) (11,396,998) (7,380,833)(1,131,162)
Interest income2,247,835  1,714,191 262,711  16,898,785  8,787,309 1,346,714 
Investment income2,706,871  9,488,916 1,454,240  6,088,425  17,697,800 2,712,307 
Income before income taxes 61,132,358    71,766,994   10,998,774    198,299,112    189,738,722   29,078,732  
Income tax expense(426,039) (13,571,895)(2,079,984) (8,214,341) (21,086,256)(3,231,610)
Net income 60,706,319    58,195,099   8,918,790    190,084,771    168,652,466   25,847,122  
          
Other comprehensive income         
Foreign currency translation adjustment(7,896,898) (15,473,522)(2,371,421) 8,882,775  (30,137,470)(4,618,769)
Unrealized gain on available for sale securities, net633,923  (2,709,593)(415,263) 1,535,923  (510,333)(78,212)
Comprehensive income 53,443,344    40,011,984   6,132,106    200,503,469    138,004,663   21,150,141  
Net income per ordinary share         
—Basic0.41  0.38 0.06  1.28  1.12 0.17 
—Diluted0.39  0.36 0.06  1.24  1.07 0.16 
Net income per ADS         
—Basic0.81  0.76 0.12  2.55  2.24 0.34 
—Diluted0.79  0.73 0.11  2.48  2.14 0.33 
          
Weighted average number of ordinary shares and ordinary shares equivalents outstanding used in computing net income per ordinary share
—Basic149,454,573  152,144,872 152,144,872  149,025,166  150,897,412 150,897,412 
—Diluted153,752,287  159,878,440 159,878,440  153,248,188  157,835,868 157,835,868 
Weighted average number of ADS outstanding used in computing net income per ADS
—Basic74,727,287  76,072,436 76,072,436  74,512,583  75,448,706 75,448,706 
—Diluted76,876,144  79,939,220 79,939,220  76,624,094  78,917,934 78,917,934 
          
Note:         
(a) Includes share-based compensation expense as follows:         
 Three months ended December 31, Year ended December 31,
 2019  2020 2019  2020
 RMB RMBUS$ RMB RMBUS$
Cost of revenues77,390  163,783 25,101  292,011  643,683 98,649 
Selling and marketing expenses1,615,396  2,671,595 409,440  4,657,311  9,945,473 1,524,210 
Research and development expenses1,949,271  2,849,169 436,654  4,207,109  10,917,637 1,673,201 
General and administrative expenses4,142,493  4,704,964 721,067  10,466,345  18,102,122 2,774,272 
Total share-based compensation expense 7,784,550    10,389,511   1,592,262    19,622,776    39,608,915   6,070,332  
          


NIU TECHNOLOGIES
RECONCILIATION OF GAAP AND NON-GAAP RESULTS
          
 Three months ended December 31, Year ended December 31,
 2019 2020 2019 2020
 RMB  RMB US$ RMB  RMB US$
Net income60,706,319 58,195,0998,918,790 190,084,771 168,652,46625,847,122
Add:         
Share-based compensation expense7,784,550 10,389,5111,592,262 19,622,776 39,608,9156,070,332
Adjusted net income 68,490,869   68,584,610 10,511,052   209,707,547   208,261,381 31,917,454
          

_______________________

1 Adjusted net income (non-GAAP) is defined as net income excluding share-based compensation expense.
2 Revenues per e-scooter on e-scooter sales from China or international markets is defined as e-scooter sales revenues from China or international markets divided by the number of e-scooters sold in China or international market in a specific period
3 Revenues per e-scooter on accessories, spare parts and services is defined as accessories, spare parts and services revenues divided by the total number of e-scooters sold in a specific period
4 Adjusted net income margin is defined as adjusted net income (non-GAAP) as a percentage of the revenues.