TD Holdings, Inc. Reports Third Quarter 2020 Financial Results
Rhea-AI Summary
TD Holdings, Inc. (Nasdaq: GLG) announced its financial results for the nine months ending September 30, 2020, reporting a significant transition to commodities trading due to COVID-19 related challenges. The company generated $7.21 million in revenues during Q3 2020, with a net income of $4.17 million, reversing the $0.26 million loss from Q3 2019. Year-to-date revenues reached $12.39 million, alongside a net income of $0.22 million. Shareholders' equity increased to $93.9 million, up 1,518.97% from the previous year, demonstrating strong financial recovery and growth prospects in its commodities trading business.
Positive
- Transition to commodities trading has led to Q3 2020 net income of $4.17 million, up from a net loss of $0.26 million in Q3 2019.
- Significant revenue growth with Q3 2020 revenues of $7.21 million, marking a successful shift from previous operations.
- Shareholders' equity surged to $93.9 million, an increase of 1,518.97% compared to $5.8 million on December 31, 2019.
Negative
- Discontinuation of the used luxurious car leasing business, leading to a net loss of $3.54 million from the disposal, indicating challenges in previous business lines.
- Despite overall positive financials, the net loss for the nine months was $3.32 million, a slight increase from a loss of $3.26 million in the same period of 2019.
News Market Reaction – GLG
On the day this news was published, GLG declined 3.59%, reflecting a moderate negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
SHENZHEN, China, Nov. 13, 2020 /PRNewswire/ -- TD Holdings, Inc. (Nasdaq: GLG) (the "Company"), a commodities trading and supply chain management service provider in China today announced its financial results for the nine months ended September 30, 2020.
Affected by the ongoing outbreak of the COVID-19, the Company expected its used luxurious car leasing business to be subject to continuous losses due to the closure of stores. As a result, the Company sold the used luxurious car leasing business in August 2020 and focus on the commodities trading and its complementary business.
Mrs. Renmei Ouyang, the Chief Executive Officer of the Company, stated, "We are pleased to report our financial results for the nine months ended September 30, 2020. We started our commodities trading business in late 2019. We have successfully achieved net income from our continuing operations in the third quarter of 2020. We plan on continuing to develop our commodities trading business in terms of volume, revenues and net profit, and increase its value to our stockholders. In addition, our recent acquisition of Shenzhen Qianhai Baiyu Supply Chain Co., Ltd. has laid a solid foundation for us to further expand our supply chain business in areas including warehousing, logistics, processing, and providing supply chain financing to downstream clients. We expect Qianhai Baiyu to synergize well with Huamucheng's existing operations as the two businesses will be able to share customer resources and sales channels, increasing our cost efficiency."
Financial Highlights
In the quarter ended September 30, 2020
- Revenues from commodities trading business was
$7.21 million , consisting of$3.68 million from sales of commodities products, and$3.53 million from supply chain management services for the quarter ended September 30, 2020; - Net income from continuing operations was
$4.17 million , as compared with net loss from continuing operations of$0.26 million for the same period ended September 30, 2019. Net income was$1.18 million , as compared with net loss of$0.39 million for the same period ended September 30, 2019; - Basic and diluted earnings per share from continuing operations was
$0.07 , compared with basic and diluted loss per share from continuing operations of$0.03 for the same period ended September 30, 2019. Basic and diluted earnings per share was$0.02 , compared with basic and diluted loss per share of$0.05 for the same period ended September 30, 2019; and - Shareholders' equity as of September 30, 2020 was
$93.9 million , an increase of 1,518.97% compared with$5.8 million as of December 31, 2019.
In the nine months ended September 30, 2020
- Revenues from commodities trading business was
$12.39 million , consisting of$6.30 million from sales of commodities products, and$6.09 million from supply chain management services for the quarter ended September 30, 2020; - We raised funds aggregating
$30 million from issuance of convertible notes, accompanied by warrants to purchase 20,000,000 shares of Common Stock issuable upon exercise of the warrants at an exercise price of$1.80 , and raised$36 million from the holders of convertible notes upon their conversion of the convertible notes and exercise of the warrants. We therefore incurred noncash amortization of beneficial conversion feature of$3.4 million and amortization of relative fair value of warrants of$3.06 million ; - Net income from continuing operations was
$0.22 million , as compared with net loss from continuing operations of$2.12 million for the same period ended September 30, 2019. Net loss was$3.32 million , as compared with$3.26 million for the same period ended September 30, 2019; and - Basic and diluted earnings per share from continuing operations was
$0.01 , compared with basic and diluted loss per share from continuing operations of$0.30 for the same period ended September 30, 2019. Basic and diluted loss per share was$0.08 , compared with basic and diluted loss per share of$0.46 for the same period ended September 30, 2019.
Financial Results
In the three months ended September 30, 2020
Revenues
For the three months ended September 30, 2020, the Company sold non-ferrous metals to six customers at fixed prices, and earned revenues when the product ownership was transferred to its customers. The Company earned revenues of
For the three months ended September 30, 2020, the Company earned distribution commission fees of
Cost of revenue
Cost of revenue primarily consists of purchase costs of non-ferrous metal products and business taxes and surcharges. For the three months ended September 30, 2020, the Company purchased non-ferrous metal products of
Selling, general, and administrative expenses
Selling, general and administrative expenses increased from
Interest income
Interest income was primarily generated from loans made to third parties and related parties. For the three months ended September 30, 2020, interest income was
Net loss from discontinued operations
During the three months ended September 30, 2020, the net loss from discontinued operations was comprised of a net loss of $nil from discontinued operations of the used luxurious car leasing business and a loss of
During the three months ended September 30, 2019, the net loss from discontinued operations was comprised of a net loss of
Net loss
Net income from continuing operations for the three months ended September 30, 2020 was
Net income for the three months ended September 30, 2020 was
In the nine months ended September 30, 2020
Revenues
For the nine months ended September 30, 2020, the Company sold non-ferrous metals to six customers at fixed prices, and earned revenues when the product ownership was transferred to its customers. The Company earned revenues of
For the nine months ended September 30, 2020, the Company earned
Cost of revenue
Cost of revenue primarily consists of purchase costs of non-ferrous metal products and business taxes and surcharges. For the nine months ended September 30, 2020, the Company purchased non-ferrous metal products of
Selling, general, and administrative expenses
Selling, general and administrative expenses decreased from
Interest income
Interest income was primarily generated from loans made to third parties and related parties. For the nine months ended September 30, 2020, interest income was
Amortization of beneficial conversion feature and relative fair value of warrants relating to issuance of convertible notes
For the nine months ended September 30, 2020, there was amortization of beneficial conversion feature of
For the nine months ended September 30, 2020, no such expenses were incurred.
Net loss from discontinued operations
During the nine months ended September 30, 2020, the net loss from discontinued operations was comprised of net loss of
During the nine months ended September 30, 2019, the net loss from discontinued operations was comprised of net loss of
Net loss
Net income from continuing operations for the nine months ended September 30, 2020 was
Net loss for the nine months ended September 30, 2020 was
Nine Months Ended September 30, 2020 Cash Flows
As of September 30, 2020, the Company had cash and cash equivalents of
Net cash provided by operating activities from continuing operations was
Net cash used in investing activities was
Net cash provided by financing activities was
About TD Holdings, Inc.
TD Holdings, Inc. (Nasdaq: GLG) is a commodities trading and supply chain management service provider in China. Our commodities trading and supply chain management businesses are conducted under the brand names "Huamucheng" by Shenzhen Huamucheng Trading Co., Ltd. and "Qianhai Baiyu" by Shenzhen Qianhai Baiyu Supply Chain Co., Ltd., the Company's wholly owned subsidiaries in Shenzhen. 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. 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.
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SOURCE TD Holdings, Inc.