Ebang International Reports Financial Results for Fiscal Year 2021

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: [email protected]

Ascent Investor Relations LLC
Ms. Tina Xiao
Tel: (917) 609-0333
Email: [email protected]


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  
                         

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