Global Internet of People, Inc. Announces 2021 Fiscal Year Financial Results


BEIJING, May 02, 2022 (GLOBE NEWSWIRE) -- Global Internet of People, Inc. (“SDH” or the “Company”) (NASDAQ: SDH), today announced its financial results for the fiscal year ended December 31, 2021.

 For fiscal years ended December 31
($ millions, except per share data, differences due to rounding) 2021   2020 % Change
Net Revenues$7.41  $23.18 (68.03%)
Total costs and operating expenses$14.82  $8.46 75.18%
(Loss) profit from operation$(7.41) $14.73 (150.31%)
Net (loss) income attributable to controlling shareholders$(8.40) $12.09 (169.48%)
(Loss) earnings per share – Basic and Diluted$(0.36) $0.72 (149.41%)
          

Mr. Haiping Hu, Chairman of the Board of the Directors and CEO of SDH, commented: “During fiscal year 2021, our operations continued to be affected by the Covid-19 pandemic, as the hosting of large-scale events and activities was banned due to government restrictions in China. In order to mitigate the negative impact of the Covid-19 pandemic on our business, we managed to hold more small forums and salons to provide consulting services and facilitated sales of merchandises. As a result, our net revenues decreased by 68.03% compared to that of fiscal year 2020, and the Company also reported a net loss attributable to controlling shareholders of $8.40 million for fiscal year 2021, as compared to a net income of $12.09 million for fiscal year 2020, but our revenues from consulting services and sales of merchandises grew by over 280% and 40%, respectively, from a year earlier.”

“Meanwhile, we are also pursuing a major growth strategy to enter into the new energy material market. We have formed a joint venture with a number of parties, for the production of high-grade lithium-ion power battery anode materials. The clean energy initiatives around the world has led to rapid development of new energy vehicles and a huge increase in the demand for lithium-ion batteries. We believe that the new energy material market in general and the production of lithium-iron power battery anode materials have significant growth potential. We are very excited about this growth opportunity and hope it will bring great returns for our shareholders.”

Ms. Chao Liu, CFO of SDH, commented: “in fiscal year 2021, our knowledge sharing and enterprise service operation continued to be impacted by the Covid-19 pandemic. Although we expect the negative impact of Covid-19 pandemic on our business will continue in fiscal year 2022, we are currently executing a strategic plan to expand our business into the new energy material market, which is expected to diversify our business and create great growth for our company in the future.”

Fiscal Year 2021 Financial Results

Revenue

Revenues for the year ended December 31, 2021 and 2020 were derived from the following sources:

  For the year ended December 31, 
($ millions, differences due to rounding) 2021  %  2020  %  Change  % 
                   
Member services $0.50   6.73% $0.87   3.76% $(0.37)  (42.89)%
Enterprise service                        
-Comprehensive tailored services  1.44   19.35%  13.35   57.57%  (11.91)  (89.26)%
-Sponsorship advertising services  1.73   23.41%  6.60   28.47%  (4.87)  (73.72)%
-Consulting services  1.58   21.37%  0.42   1.80%  1.16   280.09%
Online services  0.04   0.55%  0.36   1.56%  (0.32)  (88.84)%
Sales of merchandises  2.11   28.41%  1.50   6.45%  0.61   40.75%
Other services  0.01   0.18%  0.09   0.39%  (0.08)  (84.50)%
Revenues, net $7.41   100.00% $23.19   100.00% $(15.78)  (68.04)%
                         

Our revenues decreased by $15.78 million, or 68.04%, from $23.19 million for the year ended December 31, 2020, to $7.41 million for the year ended December 31, 2021. Revenues from member services accounted for 6.73% of our net revenues in year ended December 31, 2021, as compared to 3.76% in year ended December 31, 2020.

Revenue from enterprise services accounted for 64.13% and 87.84% of our net revenues for the years ended December 31, 2021 and 2020, respectively. Revenue from sales of merchandises accounted for 28.41% and 6.45% of our net revenues for the years ended December 31, 2021 and 2020, respectively.

Revenues from member services decreased by $0.37 million, or 42.89%, from $0.87 million for the year ended December 31, 2020, to $0.50 million for the year ended December 31, 2021. Due to the government restrictions to prevent the further spread of COVID-19, we were prevented from offering large offline activities, which resulted in a decreased demand for member services.

Revenues from comprehensive tailored services decreased by $11.91 million, or 89.26%, from $13.35 million for the year ended December 31, 2020, to $1.44 million for the year ended December 31, 2021. Due to the Covid-19 pandemic, the demand of comprehensive tailored services for large conference and salon organization decreased.

Revenues from sponsorship advertising services decreased by $4.87 million, or 73.72% from $6.60 million for the year ended December 31, 2020, to $1.73 million for the year ended December 31, 2021, primarily due to the fact that offline forums and study tours were generally canceled because of the government restrictions on public gatherings.

Revenues from consulting services increased by $1.16 million, or 280.09% from $0.42 million for the year ended December 31, 2020, to $1.58 million for the year ended December 31, 2021, primarily due to the fact that we managed to hold more small forums and salons to provide consulting services instead of large conferences.

Revenue from online services decreased by $0.32 million, or 88.84% from $0.36 million for the year ended December 31, 2020 to $0.04 million for the year ended December 31, 2021. The decrease was primarily because we offered more free streaming content to attract existing potential clients.

Revenues from sales of merchandises increased by $0.61 million, or 40.75% from $1.50 million for the year ended December 31, 2020 to $2.11 million for the year ended December 31, 2021. The increase was primarily due to the fact that we organized more small trade conferences facilitating the sales of merchandises.

The decrease in our revenues was primarily attributable to the decrease in the revenue generated from comprehensive tailored services, sponsorship advertising services, member services, which was partially offset by the increase of revenue from consulting services and sales of merchandises.

Costs and operating expenses

Costs and operating expenses are consisted of service costs, cost of goods sold, selling expenses, general and administrative expenses and research and development expenses.

Service costs decreased by $0.27 million or 12.65% from $2.09 million for the year ended December 31, 2020 to $1.82 million for the year ended December 31, 2021. The decrease was mainly due to cost control for outsource expenses and decrease in video maintenance service fee, which was partially offset by increase in conference cost as the Company held more small conferences. Cost of goods sold were $2.06 million and $0.89 million for the years ended December 31, 2021 and 2020, respectively. The significant increase of the cost of goods sold was due to a sale of electrolytic copper, which incurred cost of goods sold of $2.00 million.

Selling expenses Selling was $0.95 million for the year ended December 31, 2021, which remained stable compared with $0.91 million for the year ended December 31, 2020.

General and administrative expenses increased by $3.93 million or 101.03%, from $3.90 million for the year ended December 31, 2020 to $7.83 for the year ended December 31, 2021. The increase was mainly due to increase in bad debt expenses that were led by a slow-down in collection of accounts receivable during the Covid-19 pandemic. Other fees such as directors’ and officers’ liability insurance, training consulting fee, lawyer fee, independent director fee and other miscellaneous service fee also increased for the year ended December 31, 2021.

In order to meet public company reporting and corporate governance requirements to meet all of the demands associated with being a public company, audit fee, management insurance and miscellaneous service fee, including training and general consulting services, too, increased for the year ended December 31, 2021.

Research and development expenses for our mobile application, the APP, increased by $1.48 million or 220.50% from $0.67 million for the year ended December 31, 2020 to $2.15 million for the year ended December 31, 2021, primarily due to the fact that we hired more personnel to maintain the APP to meet our Users’ increasing need.

Other expenses (income), net

Total net other expenses were $1.54 million for the year ended December 31, 2021, and the net other income was $0.29 million for the year ended December 31, 2020. The net other expenses for the year ended December 31, 2021 was primarily consisted of the investment loss of $2.12 million, which was mainly attributed by the investment loss in a trust fund of $2.04 million, and partially offsetting by the government subsidies received amounted to $0.41 million. Total net other income for the year ended December 31, 2020 was primarily consisted of interest income of $0.21 million.

Income taxes provision

The PRC income taxes benefit was $0.24 million for the year ended December 31, 2021, primarily generated by the annual taxable loss. The income tax provision was $3.05 million for the year ended December 31, 2020.

Net loss (income) attributable to the Company

Net loss attributable to the Company was $8.40 million for the year ended December 31, 2021, and net income was $12.09 million for the year ended December 31, 2020.

Basic and diluted (loss) earnings per share

Basic and diluted loss per share were $0.36 in 2021, compared to earnings per share of $0.72 in the same period of 2020.

Cash and cash equivalents

As of December 31, 2021, our cash and cash equivalents amounted to $13.92 million as compared to $10.97 million and $9.44 million as of December 31, 2020 and 2019.

Working capital

As of December 31, 2021 and December 31, 2020, our working capital was $32.62 million and $22.67 million, respectively.

Recent Development

On April 2, 2022, SDH announced that Zhuhai (Zibo) Investment Co., Ltd., a wholly-owned subsidiary of SDH, entered into an investment agreement (the “Agreement”) with other parties to form a joint venture dedicated to the production of high-grade lithium-ion power battery anode materials.

On April 1, 2022, SDH announced it held an extraordinary general meeting of shareholders on April 1, 2022, and the the shareholders voted to approve the proposal to 1) form a joint venture by the Company, Guizhou Yilong District Industrial Development Investment Co., Ltd., and certain other entities and individuals, for the purposes of producing anode materials for lithium-ion batteries (the “Joint Venture”); and 2) the entry into an investment agreement in connection with the formation of the Joint Venture.

About Global Internet of People, Inc.

Headquartered in Beijing and Shanghai, Global Internet of People, Inc., through its China-based variable interest entity, operates an online knowledge sharing and enterprise service platform, both online, via a mobile application “Shidonghui App” (the “APP”), and offline, through local offices in Beijing, Shanghai and Hangzhou, as well as 51 local centers operated by some of the Company’s members in 35 cities throughout the PRC. The main services The Company offers to App users are (1) Questions and Answers Sessions and (2) streaming of audio and video courses and programs. The main offline services the Company offers to its members are study tours and forums. The Company also offers enterprise services, including comprehensive tailored services, Sponsorship advertising services, and Consulting services, to small and medium-sized enterprises in China. In 2022, the Company started pursuing its new strategic plan to enter into the new energy material market. For more information about the Company, please visit: www.sdh365.com.

Forward-looking statement

Certain statements in this press release regarding the Company's future expectations, plans and prospects constitute forward-looking statements as defined by Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements about plans, goals, objectives, strategies, future events, expected results, assumptions and any other factual statements that have not occurred. Any words that refer to "may", "will", "want", "should", "believe", "expect", "expect", "estimate", "estimate" or similar non-factual words, shall be regarded as forward-looking statements. Due to various factors, the actual results may differ materially from the historical results or the contents expressed in these forward-looking statements. These factors include, but are not limited to, the company's strategic objectives, the company's future plans, market demand and user acceptance of the company's products or services, technological updates, economic trends, the company's reputation and brand, the impact of industry competition and bidding, relevant policies and regulations, the ups and downs of China's macroeconomic conditions, the international market conditions served by the company, and the related risks and assumptions disclosed in the prospectus. In view of the above and other related reasons, we advise investors not to blindly rely on these forward-looking statements, and we urge investors to visit the SEC website to consult the company's relevant documents for other factors that may affect the company's future operating results. The company is under no obligation to make public amendments to changes in these forward-looking statements due to specific events or reasons after the declaration of these documents.

For more information, please contact:
The Company:
IR Department
Email: IR@sdh365.com

Investor Relations:
Janice Wang, Managing Partner
EverGreen Consulting Inc.
Email: IR@changqingconsulting.com
Phone: +1 571-464-9470 (from U.S.)

+86 13811768559 (from China)


GLOBAL INTERNET OF PEOPLE, INC.
CONSOLIDATED BALANCE SHEETS

  As of December  31, 
  2021  2020 
       
ASSETS      
CURRENT ASSETS      
Cash and cash equivalents $13,916,155  $10,966,012 
Accounts receivable, net  6,861,672   12,218,473 
Inventories  3,105,673   2,706,896 
Due from related parties  65,278   172,730 
Short-term investment  5,961,605   - 
Prepaid expenses and other current assets  4,435,175   2,193,494 
TOTAL CURRENT ASSETS  34,345,558   28,257,605 
         
NON-CURRENT ASSETS        
Restricted cash  700,060   - 
Long term prepayments and other non-current assets  10,244,917   - 
Property and equipment, net  3,351,321   3,397,273 
Intangible assets, net  3,594,977   4,293,813 
Long-term investments  5,381,441   3,085,247 
Operating lease right-of-use assets  224,773   100,099 
Deferred tax assets  852,037   602,806 
TOTAL NON-CURRENT ASSETS  24,349,526   11,479,238 
         
TOTAL ASSETS  58,695,084   39,736,843 
         
LIABILITIES AND SHAREHOLDERS’ EQUITY        
CURRENT LIABILITIES        
Accounts payable  34,486   33,697 
Deferred revenue  179,407   250,309 
Income taxes payable  1,076,518   4,706,972 
Operating lease liabilities, current  99,569   63,301 
Accrued expenses and other current liabilities  330,902   529,184 
TOTAL CURRENT LIABILITIES  1,720,882   5,583,463 
         
NON-CURRENT LIABILITIES        
Operating lease liabilities, non-current  -   3,196 
TOTAL NON-CURRENT LIABILITIES  -   3,196 
         
TOTAL LIABILITES  1,720,882   5,586,659 
         
EQUITY        
Ordinary shares (500,000,000 shares authorized; $0.0001 par value, 24,528,000 shares issued and outstanding as of December 31, 2021; 16,800,000 shares issued and outstanding as of December 31, 2020)  2,453   1,680 
Additional paid-in capital  31,966,816   4,462,177 
Statutory reserves  2,473,801   2,473,797 
Retained earnings  17,259,976   25,663,240 
Accumulated other comprehensive income  2,148,906   1,438,140 
Total shareholders’ equity attributable to controlling shareholders  53,851,952   34,039,034 
Non-controlling interests  3,122,250   111,150 
TOTAL EQUITY  56,974,202   34,150,184 
         
TOTAL LIABILITIES AND EQUITY $58,695,084  $39,736,843 


GLOBAL INTERNET OF PEOPLE, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

  For the years ended
December  31,
 
  2021  2020  2019 
          
REVENUE, NET $7,409,272  $23,181,084  $17,925,476 
             
COSTS AND OPERATING EXPENSES            
Service costs  1,823,358   2,087,425   2,109,649 
Cost of goods sold  2,063,296   892,791   - 
Selling expenses  946,775   906,456   1,350,894 
General and administrative expenses  7,834,291   3,897,040   2,897,079 
Research and development expenses  2,151,565   671,312   795,540 
Total costs and operating expenses  14,819,285   8,455,024   7,153,162 
             
(LOSS) PROFIT FROM OPERATIONS  (7,410,013)  14,726,060   10,772,314 
             
OTHER (EXPENSES) INCOME            
Investment losses  (2,118,453)  (1,087)  (23,799)
Interest income  173,173   214,460   212,285 
Other income, net  404,380   72,837   9,069 
Total other (expenses) income  (1,540,900)  286,210   197,555 
             
(LOSS) PROFIT BEFORE INCOME TAXES  (8,950,913)  15,012,270   10,969,869 
             
Income taxes (benefit) provision  (236,581)  3,054,983   1,589,101 
             
NET (LOSS) INCOME  (8,714,332)  11,957,287   9,380,768 
Less: net loss attributable to non-controlling interests  (311,072)  (130,240)  (365,617)
NET (LOSS) INCOME ATTRIBUTABLE TO CONTROLLING SHAREHOLDERS $(8,403,260) $12,087,527   9,746,385 
             
OTHER COMPREHENSIVE INCOME (LOSS)            
Foreign currency translation adjustment  700,316   2,076,303   (283,074)
TOTAL COMPREHENSIVE (LOSS) INCOME  (8,014,016)  14,033,590   9,097,694 
Less: comprehensive loss attributable to non-controlling interest  (321,522)  (91,862)  (366,392)
COMPREHENSIVE (LOSS) INCOME ATTRIBUTABLE TO CONTROLLING SHAREHOLDERS $(7,692,494) $14,125,452   9,464,086 
             
(LOSS) EARNINGS PER SHARE            
Basic and diluted $(0.36) $0.72  $0.58 
             
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING            
Basic and diluted *  23,638,751   16,800,000   16,800,000