Ebang International Reports Financial Results for Fiscal Year 2021

Hangzhou, CHINA


HANGZHOU, China, April 29, 2022 (GLOBE NEWSWIRE) -- Ebang International Holdings Inc. (Nasdaq: EBON, the “Company,” “we” or “our”), a global blockchain technology company, today announced its financial results for the fiscal year ended December 31, 2021.

Operational and Financial Highlights for Fiscal Year 2021

Total computing power sold in fiscal year 2021 was 1.50 million Thash/s, representing a year-over-year increase of 200% from 0.50 million Thash/s in fiscal year 2020.

Total net revenues in fiscal year 2021 were US$51.45 million representing an 170.73% year-over-year increase from US$19.00 million in fiscal year 2020.

Gross profit in fiscal year 2021 was US$29.22 million compared to the gross loss of US$2.90 million in fiscal year 2020.

Net income in fiscal year 2021 was US$2.77 million compared to net loss of US$32.11 million in fiscal year 2020.

Mr. Dong Hu, Chairman and Chief Executive Officer of the Company, commented, “2021 was a challenging year for us due to raw material supplies shortages as a result of supply chain disruptions caused by the COVID-19 pandemic. The achievement of sales growth is contributed to the efforts of our professional research and development team, who optimized the hardware structure of our products and designed a new framework with limited resources. 2021 was also an exciting year for us as we made considerable progress in connecting with the upstream and downstream markets of blockchain financial services. For example, we have completed initial preparations for our global business development, including but not limited to setting up a legal structure, building a professional team, initiating product development, and obtaining or seeking to obtain licenses or authorizations in the countries and regions into which we are expanding. Moreover, we officially launched Ebonex, our self-developed digital assets trading platform, which is designed to provide secure, fast, efficient, and stable trading services in multiple currencies and modes to a global audience. Our goal is for Ebonex to become one of the premier markets in the cryptocurrency space and become a trusted platform for its users.”

Mr. Hu continued, “We made outstanding achievements in 2021. We recruited many talents from various professional fields to join us and expand our teams, which allowed us to develop and increase the scale of our business efficiently. Despite the market turmoil across the world, investors have shown their interest in the cryptocurrency industry, and we remain confident in our business and the blockchain industry. Our objective is to drive our products and services further into the entire market ecosystem to help propel this industry forward.”

Financial Results for Fiscal Year 2021

Total net revenues in fiscal year 2021 were US$51.45 million representing an 170.73% year-over-year increase from US$19.00 million in fiscal year 2020. The year-over-year increase in total net revenues was primarily due to, among others, the continued fluctuation of the Bitcoin price in the high range in 2021, which has driven the enthusiasm and attention of investors. However, our chip suppliers have reduced their production capacity due to the impact of COVID-19, resulting in our inability to produce at full capacity, insufficient inventory and inability to meet the market demand. With limited raw materials, we optimized the hardware structure, used a new framework and launched new models, which accelerated the sales growth.

Cost of revenues in fiscal year 2021 was US$22.23 million representing an 1.47% year-over-year increase from US$21.90 million in fiscal year 2020. The year-over-year increase in cost of revenues was primarily because we have been able to utilize some of the slow-moving inventories impaired in previous years to manufacture products sold in 2021 as a result of our hardware optimization.

Gross profit in fiscal year 2021 was US$29.22 million compared to the gross loss of US$2.90 million in fiscal year 2020.

Total operating expenses in fiscal year 2021 were US$27.19 million compared to US$23.75 million in fiscal year 2020.

  • Selling expenses in fiscal year 2021 were US$1.42 million compared to US$0.93 million in fiscal year 2020. The year-over-year increase in selling expenses was in line with the increase in the Company’s sales.
  • General and administrative expenses in fiscal year 2021 were US$25.77 million compared to US$22.82 million in fiscal year 2020. The year-over-year increase in general and administrative expenses was primarily due to increase in overseas expansion.

Income from operations in fiscal year 2021 was US$2.03 million compared to loss from operations of US$26.65 million in fiscal year 2020.

Interest income in fiscal year 2021 was US$1.78 million compared to US$0.82 million in fiscal year 2020. The year-over-year increase in interest income was primarily due to the interest income from our investments in time deposit and financing products in 2021.

Government grants in fiscal year 2021 were US$0.44 million compared to US$4.01 million in fiscal year 2020. The year-over-year decrease in government grants was primarily due to the decrease of non-recurring rebates from local government.

Net income in fiscal year 2021 was US$2.77 million compared to net loss of US$32.11 million in fiscal year 2020.

Net income attributable to Ebang International Holdings Inc. in fiscal year 2021 was US$4.43 million compared to net loss attributable to Ebang International Holdings Inc. of US$30.68 million in fiscal year 2020.

Basic and diluted net income per shares in fiscal year 2021 was US$0.02 compared to basic and diluted net loss per shares of US$0.25 in fiscal year 2020.

Cash and cash equivalents were US$239.87 million as of December 31, 2021, compared with US$13.67 million as of December 31, 2020.

About Ebang International Holdings Inc.

Ebang International Holdings Inc. is a blockchain technology company with strong application-specific integrated circuit (ASIC) chip design capability. With years of industry experience and expertise in ASIC chip design, it has become a global bitcoin mining machine producer with steady access to wafer foundry capacity. With its licensed and registered entities in various jurisdictions, the Company intends to launch a professional, convenient and innovative digital asset financial service platform to expand into the upstream and the downstream of blockchain and cryptocurrency industry value chain. For more information, please visit https://ir.ebang.com.

Forward-Looking Statement

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, the Company’s development plans and business outlook, which can be identified by terminology such as “may,” “will,” “expects,” “anticipates,” “aims,” “potential,” “future,” “intends,” “plans,” “believes,” “estimates,” “continue,” “likely to” and other similar expressions intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. Such statements are not historical facts, and are based upon the Company’s current beliefs, plans and expectations, and the current market and operating conditions. Forward-looking statements involve inherent known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Company’s control, which may cause the Company’s actual results, performance and achievements to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. These forward-looking statements are made only as of the date indicated, and the Company undertakes no obligation to update or revise the information contained in any forward-looking statements as a result of new information, future events or otherwise, except as required under applicable law.

Investor Relations Contact

For investor and media inquiries, please contact:

Ebang International Holdings Inc.
Email: ir@ebang.com

Ascent Investor Relations LLC
Ms. Tina Xiao
Tel: (917) 609-0333
Email: tina.xiao@ascent-ir.com



EBANG INTERNATIONAL HOLDINGS INC.

CONSOLIDATED BALANCE SHEETS
(Stated in US dollars)
 
   December 31,
2021
  December 31,
2020
 
ASSETS       
Current assets:       
Cash and cash equivalents  $239,872,316  $13,669,439 
Restricted cash, current   171,156   406,857 
Short-term investments   35,443,246   40,835,000 
Accounts receivable, net   9,872,746   7,205,113 
Notes receivable   -   765,967 
Advances to suppliers   1,057,096   221,186 
Inventories, net   7,137,538   3,845,091 
Prepayments   283,776   522,808 
Other current assets, net   4,994,271   1,128,599 
Total current assets   298,832,145   68,600,060 
          
Non-current assets:         
Property, plant and equipment, net   33,329,610   29,123,243 
Intangible assets, net   22,512,208   23,077,435 
Operating lease right-of-use assets   2,132,247   898,335 
Operating lease right-of-use assets - related parties   1,136,775   17,701 
Restricted cash, non-current   883,130   47,455 
VAT recoverable   26,332,231   21,897,063 
Other assets   705,825   538,934 
Total non-current assets   87,032,026   75,600,166 
          
Total assets  $385,864,171  $144,200,226 
          
LIABILITIES AND EQUITY         
Current liabilities:         
Accounts payable  $3,387,836  $2,762,187 
Notes payable   -   1,087,673 
Accrued liabilities and other payables   8,962,716   21,921,614 
Loan due within one year   -   765,967 
Operating lease liabilities, current   851,936   659,807 
Operating lease liabilities - related parties, current   595,424   17,701 
Income taxes payable   13,272   556,137 
Due to related party   -   5,652,833 
Advances from customers   894,174   832,842 
Total current liabilities   14,705,358   34,256,761 
          
Non-current liabilities:         
Operating lease liabilities – related party, non-current   288,563   - 
Deferred tax liabilities   178,582   872 
Operating lease liabilities, non-current   1,712,303   118,827 
Total non-current liabilities   2,179,448   119,699 
          
Total liabilities   16,884,806   34,376,460 
          
Equity:         
Class A ordinary share, HKD0.001 par value, 333,374,217 shares authorized, 139,209,554 and 89,009,554 shares issued and outstanding as of December 31, 2021 and 2020, respectively   17,848   11,411 
Class B ordinary share, HKD0.001 par value, 46,625,783 shares authorized, issued and outstanding as of December 31, 2021 and 2020, respectively   5,978   5,978 
Additional paid-in capital   393,717,189   138,288,921 
Statutory reserves   11,079,649   11,049,847 
Accumulated deficit   (34,180,280)  (38,581,419)
Accumulated other comprehensive loss   (6,897,005)  (7,648,332)
Total Ebang International Holdings Inc. shareholders’ equity   363,743,379   103,126,406 
          
Non-controlling interest   5,235,986   6,697,360 
          
Total equity   368,979,365   109,823,766 
          
Total liabilities and equity  $385,864,171  $144,200,226 
          


 
EBANG INTERNATIONAL HOLDINGS INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(Stated in US dollars)
 
  For the year ended
December 31,
2021
  For the year ended
December 31,
2020
  For the year ended
December 31,
2019
 
Product revenue $48,323,022  $9,677,278  $93,255,813 
Service revenue  3,127,225   9,327,023   15,804,253 
Total revenues  51,450,247   19,004,301   109,060,066 
Cost of revenues  22,227,055   21,903,644   139,623,799 
Gross profit (loss)  29,223,192   (2,899,343)  (30,563,733)
             
Operating expenses:            
Selling expenses  1,418,586   925,373   1,213,294 
General and administrative expenses  25,774,237   22,822,085   18,870,794 
Total operating expenses  27,192,823   23,747,458   20,084,088 
             
Income (loss) from operations  2,030,369   (26,646,801)  (50,647,821)
             
Other income (expenses):            
Interest income  1,779,672   824,435   217,200 
Interest expenses  (4,383)  (728,346)  (2,041,491)
Other income  133,477   81,733   84,992 
Loss from investment  (3,656,520)  -   - 
Exchange gain (loss)  1,780,087   (288,346)  5,693,798 
Government grants  434,604   4,006,567   6,298,893 
VAT refund  -   -   9,138 
Other expenses  (108,328)  (108,624)  (287,530)
Total other income  358,609   3,787,419   9,975,000 
             
Income (loss) before income taxes provision (benefit)  2,388,978   (22,859,382)  (40,672,821)
             
Income taxes provision (benefit)  (378,843)  9,251,542   400,311 
             
Net income (loss)  2,767,821   (32,110,924)  (41,073,132)
Less: net income (loss) attributable to non-controlling interest  (1,663,120)  (1,435,504)  1,330,237 
Net income (loss) attributable to Ebang International Holdings Inc. $4,430,941  $(30,675,420) $(42,403,369)
             
Comprehensive income (loss)            
Net income (loss) $2,767,821  $(32,110,924) $(41,073,132)
Other comprehensive income (loss):            
Foreign currency translation adjustment  953,073   1,960,109   (1,188,488)
             
Total comprehensive income (loss)  3,720,894   (30,150,815)  (42,261,620)
Less: comprehensive income (loss) attributable to non-controlling interest  (1,461,374)  (893,905)  1,330,237 
Comprehensive income (loss) attributable to Ebang International Holdings Inc. $5,182,268  $(29,256,910) $(43,591,857)
             
Net income (loss) per ordinary share attributable to Ebang International Holdings Inc.            
Basic $0.02  $(0.25) $(0.38)
Diluted $0.02  $(0.25) $(0.38)
             
Weighted average ordinary shares outstanding            
Basic  177,715,336   121,941,226   111,771,000 
Diluted  177,865,730   121,941,226   111,771,000