CHANGZHOU, China, Jan. 17, 2025 /PRNewswire/ -- EZGO Technologies Ltd. (Nasdaq: EZGO) ("EZGO" or "we", "our", or the "Company"), a leading short-distance transportation solutions provider in China, today announced its audited financial results for the fiscal year ended September 30, 2024 (the "Fiscal Year 2024").
Fiscal Year 2024 Financial Highlights (all results compared to the prior year period unless otherwise noted)
Revenues were $21.1 million, an increase of 32.7%, which was primarily due to the increase of sales of battery packs resulting from the increased acceptance of our lithium battery packs in the market.
Gross profit was $1.5 million, an increase of 32.5%. Gross margin was 7.1%, which remained stable with a slight decrease from 7.2% for the fiscal year 2023.
Net loss was $8.1 million, an increase from net loss of $7.3 million for the fiscal year 2023, representing an increase of 11.4%, which was primarily raised from the increase in impairment of long-term equity investment.
Basic and diluted loss per share attributable to shareholders was $2.80, compared to $5.91 for the fiscal year 2023.
As of September 30, 2024, the Company had cash and cash equivalents of $3.5 million, compared to $17.3 million as of September 30, 2023.
Management Commentary
Mr. Jianhui Ye, Chief Executive Officer of EZGO, stated, "In the past fiscal year, the Company's operating revenue increased by over 30%, which was attributed to the timely adjustment of business strategies by the Company's management, their proactive response to new industry and market challenges, and the timely shift of business focusing on the lithium-ion battery (LIB) for low-speed e-bicycles. During the second quarter of this fiscal year, the e-bicycle business experienced a significant decline due to the "Nanjing EV Charging Station Massive Fire" accident, leading most dealers and consumers to adopt a wait-and-see attitude towards the existing stock of e-bicycles in the short term.
In response to changes in the market and regulatory environment, the Company has shifted its business focus towards LIB, intensifying product development efforts and cooperation with LIB manufacturing partners. The Company has also introduced multiple safe and efficient LIB products to the market through various channels, rapidly capturing the LIB market for e-bicycles and e-tricycles. Additionally, the e-bicycle business has transitioned from channel marketing to direct client marketing, with a focus on developing the e-bicycle sharing and rental market.
The aforementioned adjustment of business focus and new business layout have significantly tied up the Company's working capital, resulting in a substantial year-on-year decline in working capital at the end of this fiscal year. However, as the expansion of new LIB product channels gradually takes shape and the sales of electric vehicle begins to show results, the occupation of operating capital in these two business segments will be effectively alleviated.
During the past fiscal year, the sales of the Company's electronic control system products declined slightly compared to the previous period, yet the gross profit margin remained high. With the business strategy of increasing research and development expense and continuous market development investment, this business line is expected to contribute persistently to improving the Company's overall profitability over the next three years. The intelligent robotics business is in the market introduction phase and has not yet formed sustained and stable order support. However, the Company will continue investing in research and development for this business line, aiming to build a new product matrix."
Fiscal Year 2024 Financial Review
Net revenues
The following table identifies the disaggregation of our revenue from continuing operations and reportable segments for the fiscal years ended September 30, 2022, 2023 and 2024, respectively:
Years Ended September 30,
Segment
2022
2023
2024
Sales of batteries and battery packs
Battery cells and packs segment
$
6,990,215
$
8,245,966
$
16,318,839
Sales of e-bicycles
E-bicycle sales segment
9,405,103
4,276,147
2,899,541
Sales of electronic control system and intelligent robots
Electronic control system and intelligent robot sales segment
-
2,344,373
1,401,783
Others
993,899
1,054,173
514,262
Net Revenue
$
17,389,217
$
15,920,659
$
21,134,425
Net revenues from continuing operations for the fiscal year ended September 30, 2024 (the "Fiscal Year 2024") was $21.1 million, an increase of 32.7% from $15.9 million for the fiscal year ended September 30, 2023 (the "Fiscal Year 2023"). The increase in revenue from Fiscal Year 2023 to Fiscal Year 2024 was mainly due to the increased sales of battery packs and partially offset by the decreased sales of e-bicycles and the decreased sales of electronic control system and intelligent robots.
The revenue from sales of battery packs was $16.3 million for Fiscal Year 2024, an increase of 97.9% from $8.2 million for Fiscal Year 2023, due to the remarkable increase in sales volume derived by several large orders from major customers responding to the heightened market demand for high-performance battery solutions. In addition, such an increase mainly resulted from the increased acceptance of our lithium battery packs in the market and the development of the lead-acid battery market in Sichuan. Overall, our sales volume of lithium battery packs increased by 256.5% for the year ended September 30, 2024, compared to fiscal 2023.
The revenue from sales of e-bicycles was $2.9 million for Fiscal Year 2024, a decrease of 32.2% from $4.3 million for Fiscal Year 2023 due to the decreased sales volume of the e-bicycles resulting from the fierce competition of the e-bicycle industry.
The revenue from sales of electronic control systems and intelligent robots was $1.4 million for Fiscal Year 2024, a decrease of 40.2% from $2.3 million for Fiscal Year 2023, mainly due to the decrease of $1,510,225 in sales of intelligent robots and offset by the increase of $951,665 in sales of electronic control systems. The revenue from sales of electronic control systems increased significantly by 211.4 % for fiscal 2024 compared to fiscal 2023, primarily due to the increased emphasis on environmental protection and construction safety within the industrial machinery sector. The decrease in sales for intelligent robots is primarily attributed to the fact that our main clients were upgrading and renovating their park facilities, resulting in no demand for intelligent robots during fiscal 2024.
Cost of revenues
Cost of revenues was $19.6 million for Fiscal Year 2024, an increase of 32.8% from $14.8 million for Fiscal Year 2023, which was primarily due to the increase of manufacturing and purchase cost of battery packs for sales of batteries and battery packs, which is in line with the increase of revenues.
Gross profit
Gross profit was $1.5 million for Fiscal Year 2024, an increase of 32.5% from $1.1 million for Fiscal Year 2023.
Gross profit margin remained relatively stable, with a slight decrease from 7.2% in fiscal 2023 to 7.1% in fiscal 2024. The gross profit from electronic control system and intelligent robot sales segment increased from 25.8% for fiscal 2023 to 47.3% for fiscal 2024, predominantly attributable to the enhanced contribution of electronic control system sales business with a higher gross profit margin. The electronic control system developed and manufactured by Changzhou Higgs was embedded with highly complex software and the limited competition in the market results in a relatively high gross profit margin of 47.3% for electronic control system sales, which accounts for 6.6% of our total revenue in fiscal 2024 compared to 5.0% in fiscal 2023.
Selling and marketing expenses
Selling and marketing expenses remained relatively stable at $0.6 million for Fiscal Year 2024, a slight decrease of 9.5% compared to fiscal 2023, primarily due to the decrease in advertisement and business promotion expenses, service expenses and travel expenses. Advertisement and business promotion expenses s decreased by $71,610 or 92.6% to $5,751 in fiscal 2024, mainly due to the reduced advertising demands as our existing customer base and sales force were sufficient to support our business development and expansion. Travel expenses decreased by $13,607 or 15.3% to $75,504 in fiscal 2024; Service expenses decreased by $15,297, or 78.3%, from $19,529 in fiscal 2023 to $4,232 in fiscal 2024.
General and administrative expenses
General and administrative expenses remained relatively stable at $4.3 million for Fiscal Year 2024, a slight decrease of 8.3% from $4.7 million for Fiscal Year 2023. The decrease was primarily attributed to (1) the decrease of the share-based compensation expense of $880,851; (2) the decrease of depreciation and amortization expenses of $257,460, or 76.3%, mainly due to the disposal of Property, plant and equipment, including production lines and buildings of Tianjin Dilang and Tianjin Jiahao and E-bicycle charging piles; (3) the decrease of the professional service fees of $191,352, which was mainly due to the decrease of the investment consultancy fee. The decrease was partially offset by (1) the increase of credit losses expense on accounts receivable of $837,863, or 168.4%, mainly due to the difficulties in collecting accounts receivable from individual dealers of e-bicycles who was facing fierce competition from the industry-leading enterprises, and (2) the liquidated damages expense of $138,806 due to the early termination of a procurement contract.
Research and development expenses
Research and development expenses was $0.9 million for Fiscal Year 2024, an increase of 37.0% from $0.7 million for Fiscal Year 2023. The increase was primarily attributed to (1) the increased expenses in research and development activities for engineering vehicle wireless measurement and control system and construction worker safety positioning system of $84,735; (2) the increased depreciation and amortization expenses of $191,676 due to the patents and software acquired in May 2023, which were partially offset by the decreased expenses of $28,084 in research and development activities due to the disposal of Tianjin Dilang.
Income tax expense/benefit
EZGO incurred an income tax benefit of $786,369 for Fiscal Year 2024. This was a result from the increased deferred tax assets of $681,785, mainly due to the recurring net loss in fiscal 2024.
Net loss
Net loss was $8.1 million for Fiscal Year 2024, compared to $7.3 million for Fiscal Year 2023.
Financial Condition
As of September 30, 2024, the Company had cash and cash equivalents of $3.5 million, and a fixed deposit receipt of $1.5million with a maturity date of December 21, 2024 compared to $17.3 million as of September 30, 2023.
For additional information, please see EZGO's Annual Report on Form 20-F for the fiscal year ended September 30, 2024, which was filed with the U.S. Securities and Exchange Commission on January 17, 2025.
About EZGO Technologies Ltd.
Leveraging an Internet of Things (IoT) product and service platform and two e-bicycle brands, "EZGO" and "Cenbird," EZGO has established a business model centered on the design, manufacturing and sale of two-and three-wheeled electric vehicles, intelligent robots, complemented by electric vehicle accessories including batteries, charging piles and electronic control system. For additional information, please visit EZGO's website at www.ezgotech.com.cn. Investors can visit the "Investor Relations" section of EZGO's website at www.ezgotech.com.cn/Investor.
Exchange Rate
This announcement contains translations of certain Chinese Renminbi ("RMB") amounts into U.S. dollars ("US$") 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 RMB7.0176 to US$1.00, the exchange rate in effect as of September 30, 2024, the middle price of RMB exchange rate announced by the People's Bank of China. The Company makes no representation that the RMB or US$ 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 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. When the Company uses words such as "may," "will," "intend," "should," "believe," "expect," "anticipate," "project," "estimate," or similar expressions that do not relate solely to historical matters, it is making forward-looking statements. Forward-looking statements are not guarantees of future performance and involve risks and uncertainties that may cause the actual results to differ materially from the Company's expectations discussed in the forward-looking statements. These statements are subject to uncertainties and risks including, but not limited to, the following: the Company's goals and strategies; the Company's future business development; product and service demand and acceptance; changes in technology; economic conditions; the growth of the short-distance transportation solutions market in China and the other international markets the Company plans to serve; reputation and brand; the impact of competition and pricing; government regulations; fluctuations in general economic and business conditions in China and the international markets the Company plans to serve and assumptions underlying or related to any of the foregoing and other risks contained in reports filed by the Company with the Securities and Exchange Commission (the "SEC"), including the Company's most recently filed Annual Report on Form 20-F and its subsequent filings. For these reasons, among others, investors are cautioned not to place undue reliance upon any forward-looking statements in this press release. Additional factors are discussed in the Company's filings with the SEC, which are available for review at www.sec.gov. The Company undertakes no obligation to publicly revise these forward-looking statements to reflect events or circumstances that arise after the date hereof.
Investor Relations Contact
At the Company: Shawn Wen Phone: +86 13502829216 Email: ir@ez-go.com.cn
