Drives Year-over-Year Revenue Growth and Gross Margin ExpansionAchieves Major Milestone with Sales to Maryland's Port of BaltimoreAccelerates Expansion of the HEVI Authorized Service Provider (ASP) National NetworkEAST WINDSOR, N.J., May 16, 2024 /PRNewswire/ -- Greenland Technologies Holding Corporation (Nasdaq: GTEC) ("Greenland" or the "Company"), a technology developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machineries and vehicles, today announced ...

PART I - FINANCIAL INFORMATION [ITEM 1. FINANCIAL STATEMENTS](index=5&type=section&id=ITEM%201.%20FINANCIAL%20STATEMENTS) The company's unaudited consolidated financial statements for Q1 2024 show changes in assets, liabilities, income, and cash flows [Consolidated Balance Sheets](index=6&type=section&id=CONSOLIDATED%20BALANCE%20SHEETS) Total assets and liabilities increased as of March 31, 2024, driven by higher receivables and short-term bank loans **Consolidated Balance Sheet Highlights (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | **Assets** | | | | Total Current Assets | $103,374,342 | $99,790,741 | | Total Non-current Assets | $35,807,089 | $30,686,226 | | **TOTAL ASSETS** | **$139,181,431** | **$130,476,967** | | **Liabilities** | | | | Total Current Liabilities | $79,810,476 | $72,524,516 | | Total Non-current Liabilities | $6,057,068 | $7,299,050 | | **TOTAL LIABILITIES** | **$85,867,544** | **$79,823,566** | | **Equity** | | | | Total Shareholders' Equity | $51,928,625 | $50,080,230 | | Non-controlling Interest | $1,385,262 | $573,171 | | **TOTAL EQUITY** | **$53,313,887** | **$50,653,401** | - Total assets increased by **$8.7 million (6.67%)** from December 31, 2023, to March 31, 2024, primarily due to increases in notes receivable and fixed deposits[12](index=12&type=chunk) - Total liabilities increased by **$6.04 million (7.57%)** over the same period, mainly driven by an increase in short-term bank loans and accounts payable[15](index=15&type=chunk) [Consolidated Statements of Operations and Comprehensive Income (Loss)](index=8&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20OPERATIONS%20AND%20COMPREHENSIVE%20INCOME%20%28LOSS%29) Net income significantly increased in Q1 2024, primarily due to a gain from warrant liability fair value changes **Consolidated Statements of Operations Highlights (in U.S. Dollars):** | Item | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Revenues | $22,723,591 | $22,149,360 | | Cost of goods sold | $17,076,522 | $16,625,930 | | Gross profit | $5,647,069 | $5,523,430 | | Total operating expenses | $3,720,649 | $3,149,280 | | Income from operations | $1,926,420 | $2,374,150 | | Change in fair value of warrant liability | $1,035,306 | $0 | | Income before income tax | $3,383,247 | $2,755,432 | | Income tax benefit (expense) | $(186,001) | $296,858 | | **NET INCOME** | **$3,569,248** | **$2,458,574** | | Basic and diluted EPS | $0.18 | $0.11 | - Net income increased by **45.2% to $3.57 million** for Q1 2024, compared to $2.46 million in Q1 2023, largely due to a **$1.04 million gain** from the change in fair value of warrant liability[19](index=19&type=chunk) - Income from operations decreased by **18.9% to $1.93 million** in Q1 2024 from $2.37 million in Q1 2023, primarily due to increased selling and general & administrative expenses[19](index=19&type=chunk) [Consolidated Statements of Shareholders' Equity](index=9&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20SHAREHOLDERS'%20EQUITY) Total equity increased to $53.31 million at March 31, 2024, driven by net income and offset by comprehensive loss **Consolidated Statements of Shareholders' Equity Highlights (in U.S. Dollars):** | Item | December 31, 2023 | March 31, 2024 | | :--- | :--- | :--- | | Additional Paid-in Capital | $30,286,560 | $30,286,560 | | Retained Earnings | $18,535,133 | $21,037,336 | | Accumulated Other Comprehensive Loss | $(2,583,794) | $(3,237,602) | | Total Shareholders' Equity | $50,080,230 | $51,928,625 | | Non-controlling Interest | $573,171 | $1,385,262 | | **TOTAL EQUITY** | **$50,653,401** | **$53,313,887** | - Total equity increased by **$2.66 million (5.25%)** from December 31, 2023, to March 31, 2024, primarily due to net income of **$3.57 million**, partially offset by an unrealized foreign currency translation loss of **$0.91 million**[23](index=23&type=chunk) [Consolidated Statements of Cash Flows](index=10&type=section&id=CONSOLIDATED%20STATEMENTS%20OF%20CASH%20FLOWS) The company experienced a net cash outflow from operations in Q1 2024, a reversal from the prior year's inflow **Consolidated Statements of Cash Flows Highlights (in U.S. Dollars):** | Item | Three Months Ended March 31, 2024 | Three Months Ended March 31, 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(8,422,330) | $3,756,318 | | Net cash (used in) provided by investing activities | $(1,880,587) | $195,216 | | Net cash provided by (used in) financing activities | $2,340,022 | $(3,464,491) | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(7,962,895) | $487,043 | | Cash and cash equivalents and restricted cash at end of period | $19,835,290 | $20,260,617 | - Net cash used in operating activities was **$8.42 million** in Q1 2024, a significant decrease from **$3.76 million** provided in Q1 2023, mainly due to increases in accounts receivable (**$5.54 million**) and notes receivable (**$5.47 million**)[27](index=27&type=chunk)[252](index=252&type=chunk) - Net cash used in investing activities was **$1.88 million** in Q1 2024, primarily for purchases of long-term assets (**$1.19 million**) and loans to third parties (**$0.70 million**)[30](index=30&type=chunk)[254](index=254&type=chunk) - Net cash provided by financing activities was **$2.34 million** in Q1 2024, driven by **$5.56 million** in proceeds from short-term bank loans, partially offset by repayments of short-term bank loans and notes payable[30](index=30&type=chunk)[256](index=256&type=chunk) [Notes to Unaudited Consolidated Financial Statements](index=12&type=section&id=NOTES%20TO%20UNAUDITED%20CONSOLIDATED%20FINANCIAL%20STATEMENTS) These notes detail the company's accounting policies, financial line items, and key updates on new standards and warrants [NOTE 1 – Organization and Principal Activities](index=12&type=section&id=NOTE%201%20%E2%80%93%20ORGANIZATION%20AND%20PRINCIPAL%20ACTIVITIES) The company manufactures material handling components in the PRC and develops electric industrial vehicles in North America - Greenland's core business involves manufacturing and selling transmission products for 1-ton to 15-ton forklift trucks, with **41,866 sets sold in Q1 2024** to over 100 PRC manufacturers[34](index=34&type=chunk)[208](index=208&type=chunk) - HEVI Corp, a wholly-owned subsidiary, focuses on electric industrial vehicles and mobile DC battery chargers for the North American market, with an assembly site in Baltimore, Maryland[35](index=35&type=chunk)[209](index=209&type=chunk) - The company announced its intent to explore a separation of its electric industrial vehicles (HEVI brand) and drivetrain systems segments into two independent, publicly-traded companies via a spin-off of the drivetrain business[210](index=210&type=chunk) [NOTE 2 – Summary of Significant Accounting Policies](index=16&type=section&id=NOTE%202%20%E2%80%93%20SUMMARY%20OF%20SIGNIFICANT%20ACCOUNTING%20POLICIES) This note outlines key accounting principles, including consolidation, revenue recognition, and fair value measurements - The company's functional currency is RMB, with financial statements translated into USD at an exchange rate of **7.2203 RMB:US$** as of March 31, 2024[54](index=54&type=chunk)[55](index=55&type=chunk) - Revenue is recognized when control of products is transferred to customers, with sales of transmission boxes for forklifts accounting for **$21.77 million** in Q1 2024[79](index=79&type=chunk)[82](index=82&type=chunk) - The company adopted ASU 2016-13 (Credit Losses) on January 1, 2023, and is assessing the impact of ASU 2023-07 (Segment Disclosures) and ASU 2023-09 (Income Tax Disclosures)[111](index=111&type=chunk)[113](index=113&type=chunk)[114](index=114&type=chunk) [NOTE 3 – Short Term Investment](index=27&type=section&id=NOTE%203%20%E2%80%93%20SHORT%20TERM%20INVESTMENT) Short-term investments, primarily bank management products, slightly decreased to $2.79 million at March 31, 2024 **Short Term Investment (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $2,794,690 | | December 31, 2023 | $2,818,068 | - The fair value of bank management products was **$2,794,690** (RMB20,178,500) as of March 31, 2024[115](index=115&type=chunk) [NOTE 4 – Concentration on Revenues and Cost of Goods Sold](index=28&type=section&id=NOTE%204%20%E2%80%93%20CONCENTRATION%20ON%20REVENUES%20AND%20COST%20OF%20GOODS%20SOLD) The company exhibits significant customer concentration, with its top two customers accounting for 25.33% of Q1 2024 revenues **Major Customers' Contribution to Revenues (in U.S. Dollars):** | Customer | Q1 2024 Revenue | Q1 2024 % of Total Revenue | Q1 2023 Revenue | Q1 2023 % of Total Revenue | | :--- | :--- | :--- | :--- | :--- | | Company A | $3,214,771 | 14.15% | $4,329,109 | 14.98% | | Company B | $2,540,367 | 11.18% | $2,545,243 | 11.75% | | **Total** | **$5,755,138** | **25.33%** | **$6,874,352** | **26.73%** | **Major Customers' Accounts Receivable, Net (in U.S. Dollars):** | Customer | March 31, 2024 | March 31, 2024 % of Total AR | December 31, 2023 | December 31, 2023 % of Total AR | | :--- | :--- | :--- | :--- | :--- | | Company A | $3,133,412 | 14.81% | $2,143,828 | 12.36% | | Company B | $1,924,675 | 9.10% | $1,582,994 | 9.12% | | Company C | $1,598,495 | 7.55% | $1,415,116 | 8.16% | | Company D | $1,501,170 | 7.09% | $1,370,447 | 7.90% | | Company E | $1,351,064 | 6.39% | $1,192,684 | 6.87% | | Company F | $1,195,591 | 5.65% | $746,874 | 4.30% | | **Total** | **$10,704,407** | **50.59%** | **$8,451,944** | **48.71%** | - Accounts receivable from major customers increased from **48.71%** of total accounts receivable at December 31, 2023, to **50.59%** at March 31, 2024[119](index=119&type=chunk) [NOTE 5 – Accounts Receivable](index=28&type=section&id=NOTE%205%20%E2%80%93%20ACCOUNTS%20RECEIVABLE) Net accounts receivable increased to $21.16 million, with a corresponding increase in the allowance for credit losses **Accounts Receivable, Net (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Accounts receivable | $22,581,348 | $17,351,398 | | Less: allowance for expected credit losses | $(1,421,720) | $(867,865) | | **Accounts receivable, net** | **$21,159,628** | **$16,483,533** | **Changes in Allowance for Expected Credit Losses (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Beginning balance | $867,865 | $762,325 | | Additional provision charged to expense | $570,841 | $127,646 | | Effect of FX change | $(16,986) | $(22,106) | | **Ending balance** | **$1,421,720** | **$867,865** | - The allowance for expected credit losses increased by **$553,855 (63.8%)** from December 31, 2023, to March 31, 2024[123](index=123&type=chunk) [NOTE 6 – Inventories, Net](index=29&type=section&id=NOTE%206%20%E2%80%93%20INVENTORIES%2C%20NET) Net inventories slightly increased to $24.75 million, while inventory impairment decreased **Inventories, Net (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Raw materials | $9,363,172 | $9,337,110 | | Work-in-progress | $2,372,074 | $2,501,368 | | Finished goods | $12,299,745 | $12,192,937 | | Less: inventory impairment | $(512,937) | $(638,932) | | **Inventories, net** | **$24,746,244** | **$24,596,795** | **Changes in Inventory Reserves (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Beginning balance | $638,932 | $375,846 | | (Release of) inventory write-downs | $120,540 | $271,233 | | Effect of FX change | $(5,455) | $(8,147) | | **Ending balance** | **$512,937** | **$638,932** | - Inventory impairment decreased by **$125,995 (19.7%)** from December 31, 2023, to March 31, 2024[127](index=127&type=chunk) [NOTE 7 – Notes Receivable](index=29&type=section&id=NOTE%207%20%E2%80%93%20NOTES%20RECEIVABLE) Notes receivable significantly increased to $32.13 million, with a substantial portion pledged as security for bank notes **Notes Receivable (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Bank notes receivable | $30,838,872 | $27,135,249 | | Commercial notes receivable | $1,286,708 | $0 | | **Total** | **$32,125,580** | **$27,135,249** | - Notes receivable increased by **$4.99 million (18.39%)** from December 31, 2023, to March 31, 2024[128](index=128&type=chunk)[249](index=249&type=chunk) - As of March 31, 2024, **$24.96 million** of notes receivable were pledged as security for **$20.34 million** in bank acceptance notes[128](index=128&type=chunk) [NOTE 8 – Property, Plant and Equipment and Construction in Progress](index=30&type=section&id=NOTE%208%20%E2%80%93%20PROPERTY%2C%20PLANT%20AND%20EQUIPMENT%20AND%20CONSTRUCTION%20IN%20PROGRESS) Net property, plant, and equipment remained stable, while construction in progress saw a notable increase **Property, Plant and Equipment and Construction in Progress (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Total property plant and equipment, at cost | $33,203,716 | $33,002,200 | | Less: accumulated depreciation | $(19,481,209) | $(19,325,844) | | Property, plant and equipment, net | $13,722,507 | $13,676,356 | | Construction in process | $387,985 | $22,641 | | **Total** | **$14,110,492** | **$13,698,997** | - Construction in process increased significantly from **$22,641** at December 31, 2023, to **$387,985** at March 31, 2024[132](index=132&type=chunk) - Depreciation expense for Q1 2024 was **$0.49 million**, slightly lower than **$0.54 million** in Q1 2023[132](index=132&type=chunk) [NOTE 9 – Land Use Rights](index=30&type=section&id=NOTE%209%20%E2%80%93%20LAND%20USE%20RIGHTS) Net land use rights decreased slightly, with a portion remaining pledged as collateral for short-term bank loans **Land Use Rights (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Land use rights, cost | $4,261,125 | $4,333,386 | | Less: Accumulated amortization | $(891,431) | $(884,881) | | **Land use rights, net** | **$3,369,694** | **$3,448,505** | - As of March 31, 2024, land use rights with a net book value of **$1.07 million** were pledged as collateral for short-term bank loans[135](index=135&type=chunk) [NOTE 10 – Fixed Deposit](index=32&type=section&id=NOTE%2010%20%E2%80%93%20FIXED%20DEPOSIT) Fixed deposits increased significantly to $15.40 million, all held in PRC local banks with a three-year term **Fixed Deposit (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Three-year bank deposit | $15,395,169 | $9,916,308 | | **Total** | **$15,395,169** | **$9,916,308** | - Fixed deposits increased by **$5.48 million (55.3%)** from December 31, 2023, to March 31, 2024[140](index=140&type=chunk) [NOTE 11 – Notes Payable](index=32&type=section&id=NOTE%2011%20%E2%80%93%20NOTES%20PAYABLE) Notes payable decreased to $33.17 million, consisting entirely of interest-free, secured bank acceptance notes **Notes Payable (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Bank acceptance notes | $33,167,150 | $36,712,562 | | **Total** | **$33,167,150** | **$36,712,562** | - Notes payable decreased by **$3.55 million (9.67%)** from December 31, 2023, to March 31, 2024[141](index=141&type=chunk) - These notes are secured by **$3.85 million** in restricted cash and **$24.96 million** in notes receivable as of March 31, 2024[141](index=141&type=chunk) [NOTE 12 – Accounts Payable](index=32&type=section&id=NOTE%2012%20%E2%80%93%20ACCOUNTS%20PAYABLE) Accounts payable increased significantly to $30.85 million, driven by higher procurement of materials **Accounts Payable (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Procurement of Materials | $30,519,650 | $25,011,515 | | Infrastructure & Equipment | $202,703 | $43,530 | | Freight fee | $123,112 | $217,483 | | **Total** | **$30,845,465** | **$25,272,528** | - Accounts payable increased by **$5.57 million (22.02%)** from December 31, 2023, to March 31, 2024[142](index=142&type=chunk) [NOTE 13 – Short Term Bank Loans](index=32&type=section&id=NOTE%2013%20%E2%80%93%20SHORT%20TERM%20BANK%20LOANS) Short-term bank loans more than doubled to $8.25 million, while the average annual interest rate decreased **Short-Term Bank Loans (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Collateralized bank loans | $2,714,569 | $2,760,602 | | Unsecured bank loans | $5,539,936 | $281,694 | | **Total** | **$8,254,505** | **$3,042,296** | **Short-Term Bank Loans as of March 31, 2024 (in U.S. Dollars):** | Maturity Date | Type | Bank Name | Interest Rate per Annum (%) | Amount | | :--- | :--- | :--- | :--- | :--- | | July 22, 2024 | Operating Loans | Bank of Zheshang | 3.60 | $1,329,585 | | July 25, 2024 | Operating Loans | Bank of Hangzhou | 3.55 | $1,384,984 | | March 18, 2025 | Operating Loans | Agricultural Bank of China | 2.90 | $2,769,968 | | March 25, 2025 | Operating Loans | Industrial and Commercial Bank of Xinchang | 2.90 | $2,769,968 | | **Total** | | | | **$8,254,505** | - The average annual interest rate for short-term bank loans decreased from **3.880%** in Q1 2023 to **3.122%** in Q1 2024[147](index=147&type=chunk) [NOTE 14 – Other Current Liabilities](index=33&type=section&id=NOTE%2014%20%E2%80%93%20OTHER%20CURRENT%20LIABILITIES) Other current liabilities decreased due to lower employee and tax payables, offset by higher accrued expenses **Other Current Liabilities (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Employee payables | $119,999 | $807,615 | | Other tax payables | $287,844 | $507,464 | | Other payable | $100,704 | $115,443 | | Accrued expenses | $1,439,149 | $660,985 | | **Total** | **$1,947,696** | **$2,091,507** | - Employee payables decreased significantly from **$807,615 to $119,999**, while accrued expenses increased from **$660,985 to $1,439,149**[149](index=149&type=chunk) [NOTE 15 – Deferred Revenue](index=34&type=section&id=NOTE%2015%20%E2%80%93%20DEFERRED%20REVENUE) Deferred revenue, primarily government subsidies, decreased to $1.45 million due to the timing of qualifying expenses **Deferred Revenue (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Subsidy | $1,447,490 | $1,529,831 | | **Total** | **$1,447,490** | **$1,529,831** | - Deferred revenue decreased by **$0.08 million (5.05%)** from December 31, 2023, to March 31, 2024[152](index=152&type=chunk) [NOTE 16 – Leases](index=34&type=section&id=NOTE%2016%20%E2%80%93%20LEASES) Operating lease liabilities decreased slightly to $2.05 million, with a weighted average remaining lease term of 1.87 years **Lease Information (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Right-of-use assets | $1,996,392 | $2,125,542 | | Total operating lease liabilities | $2,048,847 | $2,172,309 | | Weighted average remaining lease term (in years) | 1.87 | 2.09 | | Weighted average discount rate | 4.6% | 4.5% | **Maturity of Lease Liabilities (Operating Leases) as of March 31, 2024 (in U.S. Dollars):** | Year Ending March 31, | Operating Leases | | :--- | :--- | | 2025 | $579,898 | | 2026 | $593,454 | | 2027 | $610,684 | | 2028 | $470,644 | | **Total lease payments** | **$2,254,680** | [NOTE 17 – Warrant Liability](index=36&type=section&id=NOTE%2017%20%E2%80%93%20WARRANT%20LIABILITY) Warrant liability decreased to $3.05 million, resulting in a non-cash gain of $1.04 million from fair value changes **Warrant Liability (in U.S. Dollars):** | Item | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Number of ordinary share warrants | 4,530,000 | 4,530,000 | | Fair value of the warrants | $3,049,299 | $4,084,605 | | Gain from change in fair value | $1,035,306 | $0 | | Share price | $2.21 | $2.79 | | Exercise price | $4.49 | $4.49 | | Expected term (years) | 1.91 | 2.04 | | Risk-free interest rate | 4.6% | 4.2% | | Expected volatility | 90.00% | 80.00% | - The company recognized a non-cash gain of **$1,035,306** for the investor warrant from the change in fair value of the warrant liability during Q1 2024[163](index=163&type=chunk) [NOTE 18 – Shareholder's Equity](index=37&type=section&id=NOTE%2018%20%E2%80%93%20SHAREHOLDER'S%20EQUITY) The company has 13,594,530 ordinary shares and 4,705,312 warrants outstanding as of March 31, 2024 - As of March 31, 2024, there were **13,594,530 ordinary shares** issued and outstanding[167](index=167&type=chunk) - A total of **4,705,312 warrants** were outstanding as of March 31, 2024, including 4,303,312 Public Warrants and 402,000 Private Warrants[174](index=174&type=chunk) - Public Warrants are exercisable for cash at **$11.50 per share** (two warrants for one share) and expire five years from the business combination, subject to redemption by the company under certain conditions[168](index=168&type=chunk)[169](index=169&type=chunk) [NOTE 19 – Earnings Per Share](index=39&type=section&id=NOTE%2019%20%E2%80%93%20EARNINGS%20PER%20SHARE) Basic and diluted earnings per share increased to $0.18 in Q1 2024, with outstanding warrants being anti-dilutive **Earnings Per Share (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net income attributable to Greenland Technologies Holding Corporation and subsidiaries | $2,502,203 | $1,446,975 | | Weighted average shares used in basic computation | 13,594,530 | 12,978,504 | | Weighted average shares used in diluted computation | 13,594,530 | 12,978,504 | | **Basic and diluted net income per share** | **$0.18** | **$0.11** | - **4,530,000 shares** underlying outstanding warrants were excluded from diluted EPS calculation for both periods as they were anti-dilutive (exercise price > average share price)[179](index=179&type=chunk) [NOTE 20 – Geographical Sales and Segments](index=39&type=section&id=NOTE%2020%20%E2%80%93%20GEOGRAPHICAL%20SALES%20AND%20SEGMENTS) The company operates as a single reportable segment, with domestic sales in China comprising the vast majority of revenue - All operations are aggregated into **one reportable operating segment** by the chief operating decision maker[98](index=98&type=chunk)[180](index=180&type=chunk) **Sales by Geographical Area (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Domestic Sales | $22,524,060 | $22,129,222 | | International Sales | $199,531 | $20,138 | | **Total** | **$22,723,591** | **$22,149,360** | - International sales increased by **890.8%** from $20,138 in Q1 2023 to $199,531 in Q1 2024[181](index=181&type=chunk) [NOTE 21 – Income Taxes](index=40&type=section&id=NOTE%2021%20%E2%80%93%20INCOME%20TAXES) The company reported an income tax expense in Q1 2024, a reversal from a benefit in Q1 2023, with a (5.50)% effective tax rate **Income Tax (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Income tax benefit (expense) | $(186,001) | $296,858 | | Effective tax rate | (5.50)% | 10.77% | - Zhejiang Zhongchai, a key subsidiary, benefits from a reduced **15% income tax rate** due to its 'high-tech enterprise' status, which is subject to reevaluation in late 2025[230](index=230&type=chunk) - The effective tax rate for Q1 2024 was **(5.50)%**, lower than the PRC tax rate of 25.0%, primarily due to the China Super R&D deduction[184](index=184&type=chunk) [NOTE 22 – Commitments and Contingencies](index=40&type=section&id=NOTE%2022%20%E2%80%93%20COMMITMENTS%20AND%20CONTINGENCIES) The company has commitments for facility leases and has pledged assets as security for loan facilities - Zhejiang Zhongchai pledged land use rights and property ownership as security for a loan facility with a maximum principal amount of **US$8.28 million** (RMB60.01 million) from June 27, 2022, to June 26, 2027[186](index=186&type=chunk) **Future Minimum Lease Payments (Operating Leases) as of March 31, 2024 (in U.S. Dollars):** | Year Ending March 31, | Operating Leases | | :--- | :--- | | 2025 | $579,898 | | 2026 | $593,454 | | 2027 | $610,684 | | 2028 | $470,644 | | **Total lease payments** | **$2,254,680** | [NOTE 23 – Related Party Transactions](index=41&type=section&id=NOTE%2023%20%E2%80%93%20RELATED%20PARTY%20TRANSACTIONS) The company's related party balances primarily consist of unsecured, interest-free payables totaling $4.02 million **Due to Related Parties (in U.S. Dollars):** | Related Party | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Cenntro Smart Manufacturing Tech Co, Ltd | $2,562 | $2,606 | | Zhuhai Hengzhong Industrial Investment Fund (Limited Partnership) | $94,442 | $94,442 | | Cenntro Holding Limited | $1,341,627 | $1,341,627 | | Hangzhou Jiuru Economic Information Consulting Co Ltd | $190,000 | $190,000 | | Peter Zuguang Wang | $2,392,961 | $2,392,961 | | **Total** | **$4,021,592** | **$4,021,636** | **Due from Related Parties-Current (in U.S. Dollars):** | Related Party | March 31, 2024 | December 31, 2023 | | :--- | :--- | :--- | | Zhuhai Hengzhong Industrial Investment Fund (Limited Partnership) | $228,311 | $225,927 | | **Total** | **$228,311** | **$225,927** | - Due to related parties primarily includes dividend payments to Cenntro Holding Limited and a payable to Peter Zuguang Wang for capital reduction[196](index=196&type=chunk) [NOTE 24 – Subsequent Events](index=42&type=section&id=NOTE%2024%20%E2%80%93%20SUBSEQUENT%20EVENTS) No subsequent events requiring disclosure were identified through May 15, 2024 - No subsequent events requiring disclosure were identified through May 15, 2024[198](index=198&type=chunk) [ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS](index=43&type=section&id=ITEM%202.%20MANAGEMENT'S%20DISCUSSION%20AND%20ANALYSIS%20OF%20FINANCIAL%20CONDITION%20AND%20RESULTS%20OF%20OPERATIONS) This analysis covers Q1 2024 financial performance, liquidity, capital resources, and recent business developments - The company relies on cash flow from operations, renewal of bank borrowings, additional equity financing, and financial support from shareholders and affiliates[239](index=239&type=chunk) - Management believes the company has sufficient cash and funding sources to operate for the next 12 months, despite uncertainties in the electric industrial heavy equipment market and potential decline in transmission product sales[240](index=240&type=chunk) - Working capital decreased by **$3.7 million to $23.56 million** as of March 31, 2024, primarily due to an increase in fixed deposits[250](index=250&type=chunk) [Overview](index=43&type=section&id=Overview) The company manufactures forklift transmission products in China and produces electric industrial vehicles in North America - Greenland Technologies Holding Corporation was incorporated on December 28, 2017, and consummated a business combination with Zhongchai Holding (Hong Kong) Limited in October 2019[200](index=200&type=chunk)[203](index=203&type=chunk) - The company manufactures transmission products for forklift trucks in the PRC, selling **41,866 sets in Q1 2024**, and operates HEVI Corp for electric industrial vehicles in North America[207](index=207&type=chunk)[208](index=208&type=chunk)[209](index=209&type=chunk) - Revenue increased by **2.6% to $22.72 million** in Q1 2024, driven by increased sales volume and market demand for transmission products[207](index=207&type=chunk) [Recent Developments](index=44&type=section&id=Recent%20Developments) The company intends to spin off its drivetrain systems business to create two independent, publicly-traded companies - On February 14, 2024, the company announced its intent to explore a separation of its electric industrial vehicles and drivetrain systems segments into two independent, publicly-traded companies[210](index=210&type=chunk) - On March 26, 2024, a share exchange agreement was entered into with Greenland Holding Enterprises Inc and Zhongchai Holding, transferring 100% equity interest of Zhongchai Holding to Greenland Holding Enterprises Inc[210](index=210&type=chunk) [Impact of COVID-19 Pandemic on Our Operations and Financial Performance](index=45&type=section&id=Impact%20of%20COVID-19%20Pandemic%20on%20Our%20Operations%20and%20Financial%20Performance) The COVID-19 pandemic had a limited impact on operations for Q1 2024 and 2023 as Chinese industries resumed business - Chinese industries gradually resumed businesses since the Chinese government lifted its COVID-19 protocols and measures in December 2022[212](index=212&type=chunk) - The COVID-19 pandemic had a limited impact on the company's financial condition and results of operations in the three months ended March 31, 2024 and 2023[212](index=212&type=chunk) [Results of Operations](index=45&type=section&id=Results%20of%20Operations) Q1 2024 revenue grew 2.6%, but operating income fell 18.9%, while net income rose 45.2% on a non-cash gain **Key Financial Performance Indicators (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | Change ($) | Variance (%) | | :--- | :--- | :--- | :--- | :--- | | Revenues | $22,723,591 | $22,149,360 | $574,231 | 2.6% | | Cost of Goods Sold | $17,076,522 | $16,625,930 | $450,592 | 2.7% | | Gross Profit | $5,647,069 | $5,523,430 | $123,639 | 2.2% | | Total Operating Expenses | $3,720,649 | $3,149,280 | $571,369 | 18.1% | | Income from operations | $1,926,420 | $2,374,150 | $(447,730) | (18.9)% | | Interest income | $169,213 | $30,393 | $138,820 | 456.7% | | Interest expenses | $(43,840) | $(66,493) | $22,653 | (34.1)% | | Change in fair value of the warrant liability | $1,035,306 | $0 | $1,035,306 | 100.0% | | Other income | $296,148 | $417,382 | $(121,234) | (29.0)% | | Income before income tax | $3,383,247 | $2,755,432 | $627,815 | 22.8% | | Income tax | $(186,001) | $296,858 | $(482,859) | (162.7)% | | Net income | $3,569,248 | $2,458,574 | $1,110,674 | 45.2% | [Revenue](index=46&type=section&id=Revenue) Revenue increased by 2.6% to $22.72 million in Q1 2024, driven by higher sales volume of transmission products **Revenue (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $22,723,591 | | Three months ended March 31, 2023 | $22,149,360 | | **Change** | **$574,231** | | **Variance** | **2.6%** | - The increase in revenue was primarily a result of the increase in the Company's sales volume, driven by increasing market demand for transmission products[218](index=218&type=chunk) - On an RMB basis, revenue for Q1 2024 increased by approximately **7.8%** compared to Q1 2023[218](index=218&type=chunk) [Cost of Goods Sold](index=46&type=section&id=Cost%20of%20Goods%20Sold) Cost of goods sold increased by 2.7% to $17.08 million, in line with the increase in sales volume **Cost of Goods Sold (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $17,076,522 | | Three months ended March 31, 2023 | $16,625,930 | | **Change** | **$450,592** | | **Variance** | **2.7%** | - Cost of goods sold increased due to the increase in sales volume[219](index=219&type=chunk) [Gross Profit](index=46&type=section&id=Gross%20Profit) Gross profit increased by 2.2% to $5.65 million, with gross margins remaining stable at approximately 24.9% **Gross Profit (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $5,647,069 | | Three months ended March 31, 2023 | $5,523,430 | | **Change** | **$123,639** | | **Variance** | **2.2%** | - Gross margins were approximately **24.9%** for both Q1 2024 and Q1 2023[220](index=220&type=chunk) [Operating Expenses](index=47&type=section&id=Operating%20Expenses) Total operating expenses increased by 18.1% to $3.72 million, driven by higher selling and G&A expenses **Total Operating Expenses (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $3,720,649 | | Three months ended March 31, 2023 | $3,149,280 | | **Change** | **$571,369** | | **Variance** | **18.1%** | [Selling Expenses](index=47&type=section&id=Selling%20Expenses) Selling expenses increased by 41.8% to $0.55 million in Q1 2024, mainly due to higher shipping expenses **Selling Expenses (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $549,496 | | Three months ended March 31, 2023 | $387,485 | | **Change** | **$162,011** | | **Variance** | **41.8%** | [General and Administrative Expenses](index=47&type=section&id=General%20and%20Administrative%20Expenses) General and administrative expenses rose by 33.0% to $2.18 million in Q1 2024 due to higher credit loss allowance **General and Administrative Expenses (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $2,183,429 | | Three months ended March 31, 2023 | $1,641,904 | | **Change** | **$541,525** | | **Variance** | **33.0%** | [Research and Development (R&D) Expenses](index=47&type=section&id=Research%20and%20Development%20%28R&D%29%20Expenses) R&D expenses decreased by 11.8% to $0.99 million in Q1 2024 due to a reduction in R&D activities **Research and Development Expenses (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $987,724 | | Three months ended March 31, 2023 | $1,119,891 | | **Change** | **$(132,167)** | | **Variance** | **(11.8)%** | [Income from Operations](index=47&type=section&id=Income%20from%20Operations) Income from operations decreased by 18.9% to $1.93 million due to higher operating expenses **Income from Operations (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $1,926,420 | | Three months ended March 31, 2023 | $2,374,150 | | **Change** | **$(447,730)** | | **Variance** | **(18.9)%** | [Interest Income and Interest Expenses](index=47&type=section&id=Interest%20Income%20and%20Interest%20Expenses) Interest income surged 456.7% due to higher bank deposits, while interest expenses decreased 34.1% **Interest Income and Expenses (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | Change ($) | Variance (%) | | :--- | :--- | :--- | :--- | :--- | | Interest income | $169,213 | $30,393 | $138,820 | 456.7% | | Interest expenses | $(43,840) | $(66,493) | $22,653 | (34.1)% | - The increase in interest income was because more cash was deposited in banks during Q1 2024[226](index=226&type=chunk) - The decrease in interest expenses was primarily due to a decrease in short-term loans for Q1 2024[227](index=227&type=chunk) [Other Income](index=47&type=section&id=Other%20Income) Other income decreased by 29.0% to $0.30 million in Q1 2024, mainly due to a reduction in grant income **Other Income (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $296,148 | | Three months ended March 31, 2023 | $417,382 | | **Change** | **$(121,234)** | | **Variance** | **(29.0)%** | - The decrease in other income was primarily due to a decrease in grant income for Q1 2024[228](index=228&type=chunk) [Income Taxes](index=48&type=section&id=Income%20Taxes) The company recorded an income tax expense of $(0.19) million, a reversal from a $0.30 million benefit in Q1 2023 **Income Tax (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $(186,001) | | Three months ended March 31, 2023 | $296,858 | | **Change** | **$(482,859)** | | **Variance** | **(162.7)%** | - Zhejiang Zhongchai enjoys a reduced statutory income tax rate of **15%** due to its 'high-tech enterprise' status, compared to the standard PRC corporate income tax rate of 25%[230](index=230&type=chunk) - The effective tax rate for Q1 2024 was **(5.50)%**, primarily due to the China Super R&D deduction[184](index=184&type=chunk) [Net Income](index=48&type=section&id=Net%20Income) Net income increased by 45.2% to $3.57 million, largely driven by a non-cash gain on warrant liability **Net Income (in U.S. Dollars):** | Period | Amount | | :--- | :--- | | Three months ended March 31, 2024 | $3,569,248 | | Three months ended March 31, 2023 | $2,458,574 | | **Change** | **$1,110,674** | | **Variance** | **45.2%** | [Liquidity and Capital Resources](index=48&type=section&id=Liquidity%20and%20Capital%20Resources) The company funds operations via cash flow, loans, and shareholder support, with sufficient resources for the next year [Cash and Cash Equivalents](index=50&type=section&id=Cash%20and%20Cash%20Equivalents) Cash and cash equivalents decreased by 30.44% to $15.99 million due to increases in notes receivable and fixed deposits **Cash and Cash Equivalents (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $15,985,073 | | December 31, 2023 | $22,981,324 | | **Decrease** | **$(6,996,251)** | | **Variance** | **(30.44)%** | [Restricted Cash](index=50&type=section&id=Restricted%20Cash) Restricted cash, held as security for bank acceptance notes, decreased by 26.07% to $3.85 million **Restricted Cash (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $3,850,217 | | December 31, 2023 | $5,208,063 | | **Decrease** | **$(1,357,846)** | | **Variance** | **(26.07)%** | - Restricted cash is held by a bank as security for bank acceptance bills and is not available for the company's use[57](index=57&type=chunk)[245](index=245&type=chunk) [Accounts Receivable](index=50&type=section&id=Accounts%20Receivable) Accounts receivable increased by 30.14% to $22.58 million, attributed to higher sales and slower collections **Accounts Receivable (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $22,581,348 | | December 31, 2023 | $17,351,398 | | **Increase** | **$5,229,950** | | **Variance** | **30.14%** | **Allowance for Expected Credit Losses (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $1,421,720 | | December 31, 2023 | $867,865 | | **Increase** | **$553,855** | | **Variance** | **63.82%** | [Due from Related Party](index=50&type=section&id=Due%20from%20Related%20Party) The amount due from a related party remained stable at $0.23 million, representing an interest-bearing loan **Due from Related Party (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $228,311 | | December 31, 2023 | $225,927 | | **Change** | **$2,384** | | **Variance** | **1.06%** | - The balance is an interest-bearing loan with an annual interest rate of **4.785%**[197](index=197&type=chunk)[248](index=248&type=chunk) [Notes Receivable](index=51&type=section&id=Notes%20Receivable) Notes receivable increased by 18.39% to $32.13 million, with collection expected within the next twelve months **Notes Receivable (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $32,125,580 | | December 31, 2023 | $27,135,249 | | **Increase** | **$4,990,331** | | **Variance** | **18.39%** | [Working Capital](index=51&type=section&id=Working%20Capital) Working capital decreased by $3.7 million to $23.56 million, primarily due to an increase in fixed deposits **Working Capital (in U.S. Dollars):** | Date | Amount | | :--- | :--- | | March 31, 2024 | $23,563,866 | | December 31, 2023 | $27,266,225 | | **Decrease** | **$(3,702,359)** | | **Variance** | **(13.58)%** | [Cash Flow](index=51&type=section&id=Cash%20Flow) The company experienced a significant cash outflow from operations, offset by inflows from financing activities **Cash Flow Summary (in U.S. Dollars):** | Item | Q1 2024 | Q1 2023 | | :--- | :--- | :--- | | Net cash (used in) provided by operating activities | $(8,422,330) | $3,756,318 | | Net cash (used in) provided by investing activities | $(1,880,587) | $195,216 | | Net cash provided by (used in) financing activities | $2,340,022 | $(3,464,491) | | Net (decrease) increase in cash and cash equivalents and restricted cash | $(7,962,895) | $487,043 | | Cash and cash equivalents and restricted cash at end of period | $19,835,290 | $20,260,617 | [Operating Activities](index=51&type=section&id=Operating%20Activities) Net cash used in operating activities was $8.42 million, driven by increases in accounts and notes receivable - Main cash outflows from operating activities in Q1 2024 were accounts receivable (**$5.54 million**), notes receivable (**$5.47 million**), and other current and noncurrent assets (**$6.12 million**)[252](index=252&type=chunk) - Main cash inflows in Q1 2024 were net income (**$3.57 million**) and accounts payable (**$6.02 million**)[252](index=252&type=chunk) [Investing Activities](index=51&type=section&id=Investing%20Activities) Net cash used in investing activities was $1.88 million, mainly for asset purchases and loans to third parties - Cash used in investing activities for Q1 2024 was primarily due to **$1.19 million** for purchases of long-term assets and **$0.70 million** loaned to third parties[254](index=254&type=chunk) - Q1 2023 investing activities provided **$0.20 million**, mainly from government grants for construction (**$0.26 million**), offset by asset purchases and joint venture investment[254](index=254&type=chunk) [Financing Activities](index=52&type=section&id=Financing%20Activities) Net cash provided by financing activities was $2.34 million, driven by proceeds from short-term bank loans - Q1 2024 financing activities provided **$2.34 million**, mainly from **$5.56 million** in proceeds from short-term bank loans, offset by **$0.28 million** in loan repayments and **$2.95 million** change in notes payable[256](index=256&type=chunk) - Q1 2023 financing activities used **$3.46 million**, primarily due to **$2.48 million** in related party loan repayments and **$3.18 million** in notes payable repayments, partially offset by new short-term bank loans and third-party proceeds[256](index=256&type=chunk) [Credit Risk](index=52&type=section&id=Credit%20Risk) The company manages credit risk from unsecured accounts receivable through approvals, limits, and monitoring - Credit risk is managed through credit approvals, limits, and monitoring procedures, with assessment based on customer risk characteristics, industry, geography, and customer type[257](index=257&type=chunk) [Liquidity Risk](index=52&type=section&id=Liquidity%20Risk) Liquidity risk is managed by analyzing financial positions and monitoring conditions to ensure sufficient capital - Liquidity risk is managed through financial position analysis and monitoring procedures, with recourse to other financial institutions for short-term funding if needed[258](index=258&type=chunk) [Inflation Risk](index=52&type=section&id=Inflation%20Risk) The company is exposed to inflation risk, which could increase costs and impair operating results - Inflationary factors, such as increases in raw material and overhead costs, could impair operating results if selling prices do not increase proportionally[259](index=259&type=chunk) - High inflation may also affect the company's ability to enter into future traditional debt financing due to increased costs[259](index=259&type=chunk) [Critical Accounting Policies and Estimates](index=52&type=section&id=Critical%20Accounting%20Policies%20and%20Estimates) Critical accounting policies involve significant estimates in areas like revenue recognition, inventory, and income taxes - Critical accounting policies involve significant estimates and assumptions that affect reported amounts of assets, liabilities, revenues, and expenses[260](index=260&type=chunk) [Revenue Recognition](index=53&type=section&id=Revenue%20Recognition) Revenue is recognized when control of goods is transferred to customers, following a five-step analysis under ASC 606 - Revenue is recognized when goods or services are transferred to customers, reflecting the consideration expected, following a five-step analysis under ASC Topic 606[262](index=262&type=chunk) - Control is typically transferred at customer acceptance or consumption, with international sales recognized when shipment clears customs and leaves the port[263](index=263&type=chunk) [Business Combination](index=53&type=section&id=Business%20Combination) The 2019 business combination was accounted for as a reverse merger, with Zhongchai Holding as the accounting acquirer - The business combination with Zhongchai Holding on October 24, 2019, was accounted for as a reverse merger, with Zhongchai Holding as the accounting acquirer[265](index=265&type=chunk)[266](index=266&type=chunk) - Greenland acquired 100% of Zhongchai Holding's equity interests in exchange for **7,500,000** newly issued ordinary shares[266](index=266&type=chunk) [Inventories](index=53&type=section&id=Inventories) Inventories are valued at the lower of cost or net realizable value, with costs determined by the weighted average method - Inventories are stated at the lower of cost or net realizable value, based on estimated selling prices less completion and disposal costs[267](index=267&type=chunk) - Cost of raw materials, work-in-progress, and finished goods are determined using the weighted average method[267](index=267&type=chunk) [Income Taxes](index=54&type=section&id=Income%20Taxes) Income taxes are accounted for using the liability method, with a valuation allowance for uncertain deferred tax assets - Income taxes are accounted for using the liability method, determining deferred tax assets and liabilities based on differences between financial reporting and tax bases[269](index=269&type=chunk) - A valuation allowance is recorded if deferred tax assets are unlikely to be realized, and uncertain tax positions are recognized only if more likely than not to be sustained[269](index=269&type=chunk)[270](index=270&type=chunk) [Off Balance Sheet Arrangements](index=54&type=section&id=Off%20Balance%20Sheet%20Arrangements) The company has no off-balance sheet arrangements - The company has no off-balance sheet arrangements[271](index=271&type=chunk) [ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK](index=54&type=section&id=ITEM%203.%20QUANTITATIVE%20AND%20QUALITATIVE%20DISCLOSURES%20ABOUT%20MARKET%20RISK) As a smaller reporting company, these disclosures are not required - The company is not required to provide quantitative and qualitative disclosures about market risk as it is a smaller reporting company[271](index=271&type=chunk) [ITEM 4. CONTROLS AND PROCEDURES](index=54&type=section&id=ITEM%204.%20CONTROLS%20AND%20PROCEDURES) Disclosure controls were deemed ineffective due to a material weakness in financial reporting and accounting personnel - As of March 31, 2024, the company's disclosure controls and procedures were deemed **ineffective**[273](index=273&type=chunk) - A **material weakness** exists due to a lack of sufficient and competent financial reporting and accounting personnel with appropriate knowledge of U.S. GAAP and SEC reporting requirements[273](index=273&type=chunk) - Remedial actions include formalizing policies, recruiting and training staff, acquiring additional resources, and establishing effective oversight for financial reporting[274](index=274&type=chunk) [Evaluation of Disclosure Controls and Procedures](index=55&type=section&id=Evaluation%20of%20Disclosure%20Controls%20and%20Procedures) Management concluded disclosure controls were ineffective as of March 31, 2024, due to a material weakness - Disclosure controls and procedures were **ineffective** as of March 31, 2024, due to a material weakness in accounting and financial reporting personnel[273](index=273&type=chunk) - The remedial plan includes developing policies, recruiting personnel with U.S. GAAP knowledge, training staff, and establishing a financial and system control framework[274](index=274&type=chunk) [Changes in Internal Control Over Financial Reporting](index=55&type=section&id=Changes%20in%20Internal%20Control%20Over%20Financial%20Reporting) No material changes to internal control over financial reporting occurred during the most recent fiscal quarter - No material changes in internal control over financial reporting occurred during the most recently completed fiscal quarter[276](index=276&type=chunk) PART II - OTHER INFORMATION [ITEM 1. LEGAL PROCEEDINGS](index=56&type=section&id=ITEM%201.%20LEGAL%20PROCEEDINGS) The company reports no major legal proceedings, except for a recent shareholder derivative action against its directors - Management is not aware of any legal proceedings contemplated by governmental authorities or other parties involving the company[278](index=278&type=chunk) - On April 26, 2024, a **shareholder derivative action** was filed against the company's directors, CEO, and controlling shareholder, alleging breaches of fiduciary duties and seeking monetary damages and injunctive relief[333](index=333&type=chunk) [ITEM 1A. RISK FACTORS](index=56&type=section&id=ITEM%201A.%20RISK%20FACTORS) The company faces significant risks related to its business, operations in China, and its ordinary shares - Investment in ordinary shares is subject to risks related to business and industry, corporate structure, doing business in China, and the ordinary shares themselves[279](index=279&type=chunk) [Risks Related to Our Business and Industry](index=56&type=section&id=Risks%20Related%20to%20Our%20Business%20and%20Industry) Key business risks include cash intensity, customer concentration, competition, and new venture uncertainties - Business operations are **cash intensive**, and failure to maintain sufficient liquidity and working capital could adversely affect the business[280](index=280&type=chunk)[287](index=287&type=chunk) - High dependence on a limited number of customers (top two customers contributed **25.33% of Q1 2024 revenues**) poses a risk to growth and revenues[280](index=280&type=chunk)[296](index=296&type=chunk) - New lines of business, such as electric industrial heavy equipment, may not be successful and could subject the company to additional risks and competition[280](index=280&type=chunk)[300](index=300&type=chunk)[301](index=301&type=chunk)[303](index=303&type=chunk)[304](index=304&type=chunk) - **Volatile steel prices**, a key raw material, can cause significant fluctuations in operating results if price increases cannot be passed on to customers[280](index=280&type=chunk)[307](index=307&type=chunk)[309](index=309&type=chunk) - The company has **limited insurance coverage** for its PRC operations, exposing it to losses from product liability claims, business interruption, or natural disasters[314](index=314&type=chunk) [Risks Related to Doing Business in China](index=57&type=section&id=Risks%20Related%20to%20Doing%20Business%20in%20China) Operating in China presents risks from legal uncertainties, government influence, and evolving data security regulations - Changes in China's economic, political, or social conditions or government policies could materially and adversely affect the business and operations[282](index=282&type=chunk)[336](index=336&type=chunk)[339](index=339&type=chunk) - Uncertainties in the PRC legal system, including interpretations and enforcement of laws, and the possibility of rapid regulatory changes, could hinder business operations and affect the value of securities[282](index=282&type=chunk)[340](index=340&type=chunk)[341](index=341&type=chunk) - The PRC government exerts **substantial influence** over business activities, and new, stricter regulations or interpretations could require additional expenditures or adversely affect operations[282](index=282&type=chunk)[344](index=344&type=chunk)[346](index=346&type=chunk) - Evolving PRC laws on data security could lead to cybersecurity reviews, fines, or business suspension if not complied with[284](index=284&type=chunk)[355](index=355&type=chunk)[358](index=358&type=chunk)[361](index=361&type=chunk)[362](index=362&type=chunk)[363](index=363&type=chunk) - The company's ordinary shares may be **delisted and prohibited from trading** under the Holding Foreign Companies Accountable Act if the PCAOB is unable to inspect its auditors for two consecutive years[284](index=284&type=chunk)[389](index=389&type=chunk)[391](index=391&type=chunk) [Risks Related to Our Ordinary Shares](index=58&type=section&id=Risks%20Related%20to%20Our%20Ordinary%20Shares) Share-related risks include potential price declines from future sales, lack of dividends, and vulnerability to short sellers - Future sales of ordinary shares by the company or existing shareholders could cause the stock price to decline[285](index=285&type=chunk)[394](index=394&type=chunk) - The company **does not expect to pay dividends** in the foreseeable future, meaning investors must rely on price appreciation for returns[285](index=285&type=chunk)[397](index=397&type=chunk)[398](index=398&type=chunk) - Techniques employed by **short sellers**, including publishing negative opinions, could drive down the market price of ordinary shares and lead to instability[285](index=285&type=chunk)[400](index=400&type=chunk)[402](index=402&type=chunk) [ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS](index=77&type=section&id=ITEM%202.%20UNREGISTERED%20SALES%20OF%20EQUITY%20SECURITIES%20AND%20USE%20OF%20PROCEEDS) No unregistered sales of equity securities occurred during Q1 2024 that were not previously disclosed - No unregistered sales of equity securities occurred during Q1 2024 that were not previously disclosed[403](index=403&type=chunk) [ITEM 3. DEFAULTS UPON SENIOR SECURITIES](index=77&type=section&id=ITEM%203.%20DEFAULTS%20UPON%20SENIOR%20SECURITIES) No senior securities were issued and outstanding during the three-month period ended March 31, 2024 - No senior securities were issued and outstanding during the three-month period ended March 31, 2024[404](index=404&type=chunk) [ITEM 4. MINE SAFETY DISCLOSURES](index=77&type=section&id=ITEM%204.%20MINE%20SAFETY%20DISCLOSURES) This item is not applicable to the company - This item is not applicable[404](index=404&type=chunk) [ITEM 5. OTHER INFORMATION](index=77&type=section&id=ITEM%205.%20OTHER%20INFORMATION) There is no other information to report under this item - No other information to report[404](index=404&type=chunk) [ITEM 6. EXHIBITS](index=78&type=section&id=ITEM%206.%20EXHIBITS) This section lists all exhibits filed with the Form 10-Q, including organizational documents and certifications - Exhibits include Memorandum and Articles of Association, Equity Incentive Plans, Working Capital Loan Agreements, and Certifications pursuant to the Sarbanes-Oxley Act[406](index=406&type=chunk) - XBRL Instance, Taxonomy Extension Schema, Calculation Linkbase, Definition Linkbase, Label Linkbase, and Presentation Linkbase Documents are included[406](index=406&type=chunk) [SIGNATURES](index=79&type=section&id=SIGNATURES) The report was duly signed by the Chief Executive Officer and President on May 15, 2024 - The report was signed by Raymond Z Wang, Chief Executive Officer and President, on May 15, 2024[410](index=410&type=chunk)

EAST WINDSOR, N.J., April 23, 2024 /PRNewswire/ -- HEVI Corp. ("HEVI" or the "Company"), a manufacturer of all-electric heavy construction and farming machinery, today announced the Port Authority of New York and New Jersey has agreed to purchase the Company's HEVI GEL-5000 all-electric front loader. This is another important purchase order and reflects the ongoing electrification of key industrial and commerce centers as they target reduced costs and increased operating efficiencies. Raymond Wang, CEO of H ...

Revenue and Profitability - Greenland's revenue decreased by approximately $0.50 million, or 0.5%, to approximately $90.33 million for the fiscal year ended December 31, 2023, compared to $90.83 million for the fiscal year ended December 31, 2022. However, excluding the impact of exchange rate fluctuations, revenue increased by approximately 4.3%[266]. - Greenland's gross profit increased by approximately $4.75 million, or 23.9%, to approximately $24.58 million for the fiscal year ended December 31, 2023, with a gross margin of approximately 27.21% compared to 21.84% in the previous year[277]. - Income from operations for the fiscal year ended December 31, 2023 was approximately $10.78 million, representing an increase of approximately $4.82 million from approximately $5.96 million for the fiscal year ended December 31, 2022[283]. - Net loss was approximately $25.02 million for the fiscal year ended December 31, 2023, representing a decrease of approximately $28.82 million from the net income of approximately $3.8 million for the fiscal year ended December 31, 2022[295]. Costs and Expenses - The cost of goods sold decreased by approximately $5.24 million, or 7.4%, to approximately $65.76 million for the fiscal year ended December 31, 2023, from approximately $71.00 million for the fiscal year ended December 31, 2022, primarily due to a decrease in raw material costs[276]. - Operating expenses were $13.80 million for the fiscal year ended December 31, 2023, representing a decrease of 0.6% from $13.88 million for the fiscal year ended December 31, 2022[279]. - Selling expenses decreased by $0.31 million, or 11.8%, to approximately $2.32 million for the fiscal year ended December 31, 2023, from approximately $2.63 million for the fiscal year ended December 31, 2022[280]. - General and administrative expenses increased by approximately $0.59 million, or 10.9%, to approximately $6.05 million for the fiscal year ended December 31, 2023[281]. - Research and development expenses decreased by approximately $0.36 million, or 6.3%, to approximately $5.42 million for the fiscal year ended December 31, 2023[282]. Sales and Market Performance - Greenland sold an aggregate of 149,543 sets of transmission products in the fiscal year ended December 31, 2023, compared to 129,686 sets in the fiscal year ended December 31, 2022[267]. - The actual increase in revenue for the fiscal year ended December 31, 2023 was primarily driven by an increase in sales volume due to increasing market demand[275]. - Greenland is considered one of the major developers and manufacturers of transmission products for small and medium-sized forklift trucks in China[266]. Cash Flow and Financial Position - Cash and cash equivalents increased by approximately $6.68 million, or 41.03%, to approximately $22.98 million as of December 31, 2023[304]. - Accounts receivable increased by approximately $2.25 million, or 14.91%, to approximately $17.35 million as of December 31, 2023[306]. - Working capital decreased by approximately $32.43 million to approximately $27.27 million as of December 31, 2023[310]. - Net cash provided by operating activities for the fiscal year ended December 31, 2023, was approximately $2.45 million, a decrease of 69.8% from $8.12 million in 2022[313][314]. - The company reported a net increase in cash and cash equivalents of $6.39 million in 2023, compared to a net increase of $3.06 million in 2022[312]. - Cash and cash equivalents at the end of 2023 totaled $28.19 million, up from $19.73 million at the end of 2022[312]. Investments and Financing - Cash inflow from investing activities was approximately $1.07 million in 2023, primarily due to $0.44 million from the sale of short-term investments and $1.84 million from loan repayments[315]. - Financing activities generated a cash inflow of approximately $2.87 million in 2023, mainly from $6.72 million in short-term bank loans and $9.27 million in notes payable[316]. Risk Management - The company is exposed to credit risk, which is managed through credit approvals, limits, and monitoring procedures[318]. - Liquidity risk is managed by analyzing financial positions and obtaining short-term funding when necessary[320]. Corporate Developments - HEVI, a subsidiary of Greenland, focuses on the production and sale of electric industrial equipment, including various electric heavy industrial vehicles, and launched a 54,000 square foot assembly site in Baltimore, Maryland in August 2022[268]. - The company plans to explore a separation of its electric industrial vehicles and drivetrain systems segments into two independent, publicly-traded companies[271]. - The business combination with Zhongchai Holding was completed on October 24, 2019, resulting in Zhongchai Holding becoming a wholly owned subsidiary of the company[326][327]. Accounting Policies - The company recognizes revenues when goods or services are transferred to customers, following ASC Topic 606[323][324].

Core Insights - Greenland Technologies Holding Corporation has completed its initial sales delivery of the HEVI GEL-5000 all-electric front loader to Maryland's Port of Baltimore, part of a contract won in 2023 to support the port's electrification efforts [1] Company Overview - Greenland Technologies Holding Corporation (NASDAQ: GTEC) specializes in developing and manufacturing drivetrain systems for material handling machinery and electric vehicles, as well as electric industrial vehicles [3] Product Details - The HEVI GEL-5000 is a 5.0-ton rated load all-electric lithium wheeled front loader, featuring an operating weight of approximately 40,000 pounds and offering 9 hours of operation time per charge [2] - This front loader is designed to enhance working conditions for operators while significantly reducing ownership costs, with advantages such as zero operating emissions and simplified maintenance [2]

EAST WINDSOR, N.J., April 2, 2024 /PRNewswire/ -- Greenland Technologies Holding Corporation (Nasdaq: GTEC) ("Greenland" or the "Company"), a technology developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machineries and vehicles, today announced a further expansion of Greenland's fast growing HEVI Authorized Service Provider (ASP) national network program to North Carolina, with the addition of Truck and Auto Repair, which will support increased demand fo ...

Core Viewpoint - Greenland Technologies Holding Corporation expresses condolences regarding the Francis Scott Key Bridge collapse and reassures that its operations are currently unaffected while monitoring supply chain impacts due to port closures [1]. Group 1: Company Operations - Greenland is a developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machinery [2]. - The company plans to deliver its HEVI GEL-5000 all-electric front loader to Maryland's Port of Baltimore in April 2024, as part of a contract won in 2023 to support the port's electrification efforts [1]. Group 2: Supply Chain Management - The company is prepared to explore contingency options, such as utilizing alternative ports, to minimize supply chain disruptions and maintain commitments to customers [1].

Core Insights - Greenland Technologies Holding Corporation plans to deliver its HEVI GEL-5000 all-electric front loader to Maryland's Port of Baltimore in April 2024, as part of a contract won in 2023 to support the port's electrification efforts [1][3] Company Overview - Greenland Technologies is a developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machinery [4] Product Details - The HEVI GEL-5000 is a 5.0-ton rated load all-electric lithium wheeled front loader, featuring approximately 40,000 pounds of operating weight and 9 hours of operation time per charge [3] - The front loader is designed to improve working conditions, reduce ownership costs, and offers zero operating emissions, making it suitable for various applications including construction, mining, and waste management [3] Market Context - The Port of Baltimore is a significant economic hub, generating about 15,300 direct jobs and nearly 140,000 jobs overall, with an annual economic impact of approximately $3.3 billion in personal wages and salaries [2] - The port is strategically located, being the deepest harbor in Maryland's Chesapeake Bay and within an overnight drive of one-third of the U.S. population [2]

Core Viewpoint - Greenland Technologies Holding Corporation has announced a spin-off of its drivetrain systems business, aiming to separate its electric industrial vehicles and drivetrain systems segments into two independent, publicly-traded companies [1][2][3] Group 1: Spin-off Details - The Board of Directors has approved a plan for a tax-free spin-off of the drivetrain systems segment to existing shareholders [1][3] - Post-spin-off, Greenland will focus solely on its industrial electric vehicle business under the HEVI brand, while the drivetrain systems will operate as a separate publicly traded company [3] - Current shareholders will retain their shares in Greenland and receive an allocation of shares in the new spin-off company [3] Group 2: Strategic Rationale - The decision for the spin-off follows a review of the business portfolio aimed at enhancing shareholder value, concluding that a stand-alone company for the drivetrain systems is the most attractive strategic option [2] - CEO Raymond Wang indicated that the integrated business structure has not been reflected in the share price due to global exposure concerns, and the new structure will allow teams to focus on maximizing ROI in the growing industrial electric vehicle market [4] Group 3: Company Overview - Greenland Technologies is a developer and manufacturer of drivetrain systems for material handling machinery and electric vehicles, as well as electric industrial vehicles [5]

Group 1 - Greenland Technologies Holding Corporation (GTEC) is a developer and manufacturer of electric industrial vehicles and drivetrain systems for material handling machinery [2] - The company will present to investors at the Microcap Conference on January 31 and February 1, 2024, at Caesars Atlantic City Hotel & Casino [1] - The Microcap Conference is the largest independent event for microcaps, celebrating 20 years of hosting investment conferences [1] Group 2 - Information about the company's clean industrial heavy equipment division can be found at HEVI Corp [2]