Kandi Technologies Group Q1 2024 Earnings Call Transcript

Quartr
Provided by Quartr
May 16, 2024

There are 8 speakers on the call.

Operator

Greetings. Welcome to Kandi Technologies First Quarter 2024 Financial Results Call. At this time, all participants are in a listen only mode. A question and answer session will follow the formal presentation. Please note this conference is being recorded.

Operator

I will now turn the conference over to Kiwa Luo, Investor Relations Manager. Thank you. You may begin.

Speaker 1

Thank you, operator. Hello, everyone. Thank you for joining us on today's conference call to discuss Kandi's results for the Q1 2024. Earlier today, we issued a press release covering the results. You can find the press release on the company's website as well as from the Newswire services.

Speaker 1

On the call with me today are Mr. Xiaoming Hu, Chairman of the Board Doctor. Xueqing Dong, Chief Executive Officer and Mr. Alan Lin, Chief Financial Officer. Doctor.

Speaker 1

Dong will deliver prepared remarks in Chinese, which I will then translate. After that, we will have a Q and A session. Before we continue, please note that today's discussion will contain forward looking statements made under the safe harbor provisions of the U. S. Private Securities Litigation Reform Act of 1995.

Speaker 1

Forward looking statements involve inherent risks and uncertainties. As such, the company's actual results may be materially different from the expectations expressed today. Further information regarding these and other risks and uncertainties is included in the company's public filings with the SEC. The company does not assume any obligation to update any forward looking statements except as required under applicable law. Please note that unless otherwise stated, all figures mentioned during the conference call are in U.

Speaker 1

S. Dollars. With that, let me now turn the call over to our CEO, Zheqing Dong. Go ahead, Doctor. Dong.

Speaker 1

Hello, everyone. I'm Xueqing Dong, the CEO of Kandi Technologies Group. Welcome to today's conference call. We are pleased to report a solid start to the year, with total revenue for the Q1 approximately $20,700,000 and net income around $800,000 Despite some fluctuations in sales and overall income due to the adjustments in our sales strategy, our expansion in the North American market is progressing smoothly through collaboration with large nationwide chains. We have also been advances in the Southeast Asian and European markets, laying the groundwork for robust sales in upcoming peak season.

Speaker 1

It is with pride that we highlight our stable balance sheet and healthy financial additions. Additionally, we have repurchased 564,3002 shares this quarter, reflecting our confidence in the company's future growth. Currently, we are actively refining our product portfolio. Already in the Q1, we have begun rolling out our rechargeable AA batteries to the market. Looking ahead, we are excited to introduce starter batteries and a more competitive lineup of all electric off road vehicles and electric water sports products.

Speaker 1

We anticipate these new products will significantly drive our sales revenue upward. At the same time, we are gearing up to launch our limited edition golf cart collection. These unique series created in partnership with the National Football League and Loews will feature branding for all 32 NFL teams. This initiative is a clear indication of our confidence in our future growth and our steadfast commitment to delivering value to our shareholders. I am confident that our strategic adjustments will garner the outstanding and support of our shareholders.

Speaker 1

Now we will move on to the Q and A session. Tianming Hu Xiaoming and I will answer your questions and Ms. Qi Hua and Mr. Allen will provide translation for English questions. Please go ahead and ask your questions.

Operator

Our first question is from Michael Pfeiffer with Oppenheimer and Company. Please proceed.

Speaker 2

Hi. Thanks for taking my question. On the year end 10 ks press release, it was good to see the CEO for the first time mentioning Lowe's and making what appears to be an attempt at a very positive comment for the balance of this year. However, I assume due to a translation error, which should have been a positive statement ended up putting a negative spin on the stock that started the severe price decline. Management was immediately notified of the error, which should have been immediately corrected, but instead chose to ignore it.

Speaker 2

Here is an excerpt from the PR that contained the confusing error. Do you

Speaker 3

want to just translate that quickly? Sure.

Speaker 1

Go ahead.

Speaker 2

Thanks. Doctor. Dong, CEO of Kandi commented, we acquired Northern Group to expand our sales channels. Moreover, we further strengthened our partnership with Lowe's, expanding to more than 10 supercenters in 2024, thereby broadening our market coverage in North America. We're proud to return to profitability in 2023, marking an important milestone in our development journey.

Speaker 2

Lowe's refers to each of its 2,500 stores as supercenters in their advertising and promotions. The PR in question was the first time Kandi has even admitted in a PR that Kandi was stealthily doing business with Lowe's since mid-twenty 22. Without correcting that error in the PR, it gives an impression that Kandi is excited about Lowe's adding another 10 of its supercenters, when in reality, Kandi at that time had long since opened up all of its 2,500 stores based on store managers discretion by last year's end. Please translate that. Thank you.

Speaker 2

Also on the last conference call, Mr. Hu in response to a question stated, so for this year, on top of what we are working with the Loews superstores, we have now added the corporation with more than a dozen or so of the retail chains with different scales, currently are working on child sales in those superstores. In addition, on top of the cooperation of the supermarket, we are working with the dealership with more than 300 partnerships during 2023. And in this upcoming 2024, we are trying to work with more than 1,000 dealerships in the U. S.

Speaker 2

Market. If you could just translate that and I'll get to my questions quickly. Thank you.

Speaker 3

Okay.

Speaker 2

So questions. Since candy products were already available in all Lowe's Supercenters at the time of the prior PR quote, what specifically was the CEO attempting to refer to with his partnership with Lowe's expanding to more than 10 supercenters in the 2024 quote to broaden market coverage?

Speaker 4

So, first of all, when we are in the last conference call, when we met about over 10 of our retail partners we are talking about, Lowe's is one of the retail partners. And then speaking of Lowe's, just want to clarify that we actually don't have the access to all 2,500 of them, but rather this portion of it is still expanding based on our negotiation and collaboration. And then Mr. Hu would also like to add more color that as I just mentioned just now, we don't have access to all this 2,500 of those those of load. And currently we have roughly 500 stores, although maybe not every those are the 500 stores we carry all of our products.

Speaker 4

It depends on the category of the products and type as well. But in the and by next few months, we hopefully will expand the retail stores working with lowest up to like 600 or 900 of 1,000,000 by the end of the year. We expect the stores that will cover our products will be over 1,000. And of course, that's our plan for now. So you can be clear, the collaboration scale with them.

Speaker 2

Okay. That gives some clarity. Thank you. Regarding Mr. Hu's comment on the last conference call, was this dozen or so of the retail chains with different sales?

Speaker 2

Currently child sales like confused with the CEO's comments about the Lowe's Superstore sales in the year end PR. So can you just kind of explain a little bit more about that comment was related to the child sales on the Lowe's superstores?

Speaker 1

Okay.

Speaker 4

So first of all, I believe that there have been no such confusion because we keep stressing that there are over 10 of the retail partners that we are working with and Lois is one of them. As for the list of those retail partners of the magic retailers that we are working with, you can refer to the list on our Kandi America website. And speaking of the child sales, we are not quite sure do you mean the scale of the sales being small or do you mean the sales of the children products? Currently, we are selling all kind of our outdoor off road like our golf carts, the UTVs and ATVs with those partners. I hope this can address your question.

Speaker 2

Yes. Just I think the child sales was sort of your quote. So I guess trying to understand maybe what type of products are the child sales? Do you can you delineate that? Or is that not what you meant by child sales?

Speaker 1

Can you remind us where the quote is when you're referring to child sales?

Speaker 2

I'll have to find that.

Speaker 1

Okay.

Speaker 3

Yes, yes, it is

Speaker 2

a quote. Yes, I think it's a quote. So I said it on the last conference call, Mr. Hu in response to a question stated, so for this year on top of what we're working with the Lowe's Super stores, we have now added that corporation with more than a dozen or so of the retail chains with different scales. Currently, we are working on child sales in those superstores.

Speaker 2

I believe that's a quote from Mr. Hu. If I'm wrong, I'm wrong, but that's what I

Speaker 1

spoke. Okay. Still in the call, not in the past.

Speaker 4

I do mean trial, not the trial, trial, the trial sales.

Speaker 2

Trial. That clears it up. Trial sales, understood. Okay. Yes.

Speaker 2

Okay.

Speaker 1

Yes. That's right.

Speaker 2

All right.

Speaker 3

Well, that

Speaker 2

makes it clear. Thank you very much. Maybe it translated incorrectly in that quote. Thank you.

Speaker 4

Thank you.

Speaker 1

I'm sorry. Let me translate this first. Okay. I'm sorry, operator. Yes, we can take next question.

Operator

Thank you. Our next question is from Steve Miller, private investor. Please proceed.

Speaker 5

Good morning, question that you guys fielded, if you would resume filling out a transcript of your of the Q and A call rather than rely on third parties, that would give you an opportunity to clear up any misstatements or mistranslation. Otherwise, this is what happens. People are taking statements that in fact weren't accurate. My first question is regarding the Lowe's and its Alpha Cup. Last week Lowe's added some promotional material on their Google sponsored ads as well as adding a new website landing page on their e commerce site promoting a new line of candy golf carts as part of Lowe's $100,000,000 a year NFL exclusivity sponsorship program.

Speaker 5

From the posting, each of the 36 NFL teams would have their own custom branded candy golf carts going on sale in August for the season. Could you go ahead and translate that?

Speaker 1

Okay. Go ahead. Continue.

Speaker 5

So this weekend, I assure you all shareholders were truly excited when they saw 3 pages on the Lowe's website showing the Kandi customized carts for the 36 NFL teams inviting advanced orders for delivery in August. However, sometime on Sunday or Monday, it appears Lowe's took down those 3 landing pages. Clearly Lowe's have been working on this web design for this project for some time and rightly so as it's a terrific idea. Being it suddenly taken down was a surprise as was the taken down post on Tandy Americas' own Twitter homepage. Yet today, you proudly revealed the Loews NFL link up in your press release.

Speaker 5

Go ahead and translate So my question is, what's the status of this new Loews NFL Golf Cart offering? It's a terrific idea and should be heavily promoted by Candy as well as Lowe's as this is a huge attention getter. Not only will it help Candy sales, but just as important your credibility. That's my question.

Speaker 4

So, first of all, there are actually only 32 teams in NFL and Lowe's is the exclusive partner of an NFL to sell the golf cart branded by Kandi. And as far as the website you mentioned, we believe that there are some adjustments to be taken care of. And we estimate that all the information on the website will be shown again with such news and product information by next week. Indeed, that is a very big deal for us, Kandi, and hopefully that can promote our brand even more better.

Speaker 5

Great. And then a related question, what other products can we expect Candy to be selling through the Lowe's Candy and XL relationship?

Speaker 4

Currently, the products being sold between Lowe's and NFL of the brand under Candy is the golf carts. And we will see how it develops in the future, but that's the product for golf carts for now. Thank you.

Speaker 5

Okay. My next question is regarding your consultant and regarding the proposed spin off. On the past two conference calls, questions were asked about a statement in your 10 ks disclosing a consultant who was hired back in May of 2023 with the contract to terminate this month. The consultant was paid 300,000 shares of Candace stock worth $1,000,000 Alan had responded that the consultant was hired for your plans to spin off the U. S.

Speaker 5

Subsidiaries as one separately listed public company. Nothing else was said. Go ahead and translate

Speaker 1

that. Continue, please.

Speaker 5

If I understand your intent, it would be a NASDAQ listing, Kandi would retain a majority share position. The spin off would release value of Kandi not represented in the current share price and allow it to book as a separate company its own sales and P and L. Based on NASDAQ minimum prices and market cap however, logic would seem to make it mandatory that candy stock price would have to be trading at least 3 or 4 times higher than currently to get an underwriting sponsor firm to manage the IPO. Kandi shares have done nothing but going down since the consultant was hired. Can you go ahead and translate that?

Speaker 5

Okay. My question is, what value has the $1,000,000 consultant contract brought to Kandi given where Kandi share price stands today? And what is the contract's current status? And has the consultant been retained again or will be in the near future?

Speaker 4

Even though maybe the contract has expired, however, the related process keeps moving and the whole process is being proceeded. So we don't think those consulting fee will be wasted.

Speaker 5

I mean, do you anticipate the spin off will be finalized this year?

Speaker 4

So first of all, the plan is to do the dealer listing instead of spin off, which is 2 separate concepts. And the related process is being considered in orderly. If things go smoothly, hopefully the whole process can be completed by the end of this year.

Speaker 5

Are you anticipating any new Kandy America acquisitions to be made before the spin off will be consummated, for example, additional distribution or manufacturing facilities?

Speaker 4

We don't have such plan or consideration for now.

Speaker 5

Out of curiosity, was the consultant Patrick Coe in his company or is it someone else? And why didn't you disclose that in the SEC filings?

Speaker 1

Are you asking who is this consultant, right? How come we don't disclose in the SEC filings? Yes.

Speaker 4

We don't have to disclose the dam and the party of our consultant because they are not underwriter.

Speaker 5

I understand. Can you comment on the impact if any of the recently announced tariffs on EVs and lithium batteries?

Speaker 1

I'm sorry, Steve. You are a little bit skipping. Can you repeat your question?

Speaker 5

Sure. Can Mr. Hu comment on the impact, if any, of the recently announced tariffs on EVs and lithium batteries that was recently announced?

Speaker 1

Okay.

Speaker 4

So first of all, our golf cart product, which is one of our major revenue streams right now, is not under the scope of the electric vehicles. So that's the 100% tariff will not impact the sales of our golf cart product. Secondly, the tariff of our lithium batteries has increased from 7.5% to 25%. We will try to respond by reducing the cost and some other expense cutting in order to make our products being the same in the competitive. Finally, as for the UTV products, even though the tariff has not been pronounced yet at the moment, but we will consider using the CJD approach to produce and manufacture the electric UTV products in the United States in order to avoid the tariff impact.

Speaker 4

Hope they can address that. Thank you.

Speaker 5

Thank you. And then the picture that Twitter on Twitter that Candy America put up on their site, it showed Candy America folks posing with the Mayor of Laredo, Texas with other locals in the middle of the field, got my curiosity. Why did Candy America post that image and what should we take from it?

Speaker 1

Can you repeat the picture with who?

Speaker 5

There was a the Twitter Candy America. They posted an image of Candy America folks posing with the Mayor of Laredo, Texas with other local officials.

Speaker 1

Okay. I got you.

Speaker 4

Well, actually, it just was to explore the opportunities and possibilities. And currently, there's no very many concrete development for now.

Speaker 5

Okay. And my last quick question is, this sounds odd, who currently is the CEO of Kandi America?

Speaker 4

The CEO of Tandem America is Johnny Tai and I believe that such information is also disclosed online and our website.

Speaker 5

Okay. Thank you. Yes, DeBary Golf Carts have put out a press release and had referred to someone else. Thank you very much for your responses. Appreciate it.

Speaker 4

Thank you.

Operator

Our next question is from Terry McLemore with Lickmore and Associates. Please proceed.

Speaker 6

Yes, thank you. Two quick questions. First one is, can you give us an update on sales that are international, such as the retailers internationally that we're selling our golf carts through? That's the first question. And then the second question, can you give us guidance for the rest of 2024?

Speaker 6

And I know I'm just asking for a best guess here and maybe also for the calendar year 2025? Thank you.

Speaker 1

Hang on. Let's go 1 by 1. Your first question

Speaker 6

is? Yes. International sales, who the retailers are? What percentage?

Speaker 1

International sales?

Speaker 3

Yes.

Speaker 1

Okay.

Speaker 4

Currently, we are trying to expand ourselves to the regions such as the Southeast Asia and then the European regions. However, the scale is not big that we are trying to expand down the road.

Speaker 6

So no names that you can give us on that?

Speaker 4

As for the sales to those regions we just mentioned earlier, actually we deal with them through the trading companies and agencies in China. So we don't really work with those channels directly.

Speaker 6

Okay. Well then can you give me any kind of guidance, best guess guidance for the rest of 2024 2025? I know last year you talked about maybe doing $500,000,000 in sales in 2025, but that may be a stretch at this point.

Speaker 4

We believe that the total sales of the whole annual fiscal year 2024 will be better compared to last year. As for the target for the 2020 on 2025, we still try to impact the target to be $500,000,000 and we are trying very hard to achieve such goal. Thank you.

Speaker 6

Okay. All right. Thank you very much.

Speaker 1

Thank you.

Operator

Our next question is from Fred Bracher with Comcore Investments. Please proceed.

Speaker 7

Thank you. Last week, Kandi America gave a peek on its homepage and Twitter page under golf carts of the new $9,900 Kandi Smile. Similar by the way to a modern looking Candy Coco. What markets do you anticipate this new Candy will attract? And how big a market do you expect this vehicle to grow in both golf and LS EV configuration?

Speaker 7

I have another question after that. Thank you.

Speaker 1

Okay.

Speaker 4

So first of all, this is new type of a product using convertible format. And it is really most for recreational usage as cross border golf cart utilization. For further specs and other details of their products, you may refer and stay tuned to the information to be disclosed on our website. Thank you.

Speaker 7

Okay. Thank you. Also, are there other legacy vehicles such as Cocoa that can be resurrected to as new generation EVs over the next few years?

Speaker 4

Ongoing, we will primarily focus on our newly developed pure electric vehicles in the categories such as the golf cart, ADV and UDV.

Speaker 7

Okay. Thank you. A quick question, any intention to keep buying Kandi shares?

Speaker 1

You mean for the company, buyback continue to buyback shares? Okay.

Speaker 4

Correct. We will continue to do so till we purchase the shares of Kandi. Thank you.

Speaker 7

Okay. Thank you very much.

Operator

Our next question is from Arthur Porcari with Corporate Strategies. Please proceed.

Speaker 3

Thank you. Well, aside from the awesome news about the Loews NFL Candy collaboration announced today, what if any new breaking news products surprises this Candy had for us for this year that we don't already know about? On the last conference call, no less than 3 times when criticized by shareholders for not sharing news on new products through press releases and also a question about why Kandi doesn't follow the current trends reporting both GAAP and non GAAP numbers as most analysts prefer, we were told all this would be taken into future consideration. On each case, management reiterated that it could and would do better in the future. However, not only has it not done better in putting out breaking news, but it's also now extended the time since the last breaking news PR to over 6 months.

Speaker 3

The last breaking news PR on Candia actually put out by corporate was the NASDAQ news retrieval on the if you go to NASDAQ news retrievals service, you'll see it was titled Kandi Technology Board authorizes stock repurchase. So I must admit the Kandi NFL announcement today was certainly breaking news and is much appreciated. Go ahead and pass that on, if you would, please. Okay. Since the last November PR, Kandi has expanded its currently available products from the original single Coleman model to now more than a dozen conventional GolfLSEV carts plus new patented mini and midi sized carts along with at least 2 UTVs, a $3,000 go kart with 3 high end e bikes.

Speaker 3

And that's only locations and products that shareholders have found from the retailer's own ads on the Internet. With no help from the Kandi IR department, new products and locations are only discovered through Internet searches of sponsored ads. As witnessed by the current stock price, which has in the past traded at over $20 a share on little cash and a third of current revenues, management has lost a lot amount a large amount of respect on Wall Street from its current and past shareholders due to the lack of giving updated information. For example, Kandi's added Walmart in Q4 'twenty three with potentially 4,400 outlets, Kemper's World 2,200 outlets, and that's a New York Stock Exchange company, Costco Canada, approximately 190 potential outlets, PV Corp, 290 outlets and Rural King, 190 outlets. Go ahead and read that to

Speaker 1

all. Go ahead, continue. Okay.

Speaker 3

This despite its brilliant redefining of its conversion from EV autos to electric off road business model into a primary player in the specialty potential $1,000,000,000,000 electric space, Actually more than incredible considering it's been less than 2 years since Kandi introduced that first single golf cart and is already positioned in the top 5 of North America and growing internationally. Shareholders are upset due to signaling indifference by management and promises with competing or should I say not carried about competing for new Wall Street investors. The fact is that based on year end 2023 5 year record results, Kandi is by far the most fundamentally undervalued and profitable NASDAQ listed stock now trading at a 30% discount to its $2.90 cash, 60% discount to its book value and 35% discount to its net working capital. My questions? Go ahead and read that and I'll hit you with questions.

Speaker 1

Okay.

Speaker 3

Okay. Here's I've got 4 questions here and then a couple of just add ons. Does management who cumulatively own only 17% of Kandi stock feel any concern at all that some Chinese entity could come make a buyout tender offer at double the current $2.30 price and still end up buying Kandi, the whole company at a discount to its $5 share book value and additionally accomplish most of its heavy lifting by using Kandi's own $2.90 a share cash to steal that control.

Speaker 4

So thank you very much for your concern and reminder. We will carefully evaluate and take appropriate measures to avoid such risks. Thank you.

Speaker 3

Okay. That's not much of an answer, but let's go on to the next question. Why is management wasting shareholder value by paying for 3 different IR groups each month, but not taking the good advice that I'm sure each has at times offered. And if that's not true, they haven't offered that, then that's a good reason to fire them all. Pass that one on.

Speaker 4

Currently, we only employ 1 IO firm that is the BlueStar Group. So, actually, we don't have 3 separate IO teams. And because currently, company is in a period of the strategic adjustments to be more focused on the golf cart of the auto vehicles in the U. S. Market, we still adhere to the idea that just to do more and talk less.

Speaker 4

As our strategic adjustment gradually takes shape, we will be more proactive in making the related adjustments in our pronouncement and the IR approach. Thank you.

Speaker 3

Actually, I think you do. Well, you certainly have 2, if not 3, because the Kandi America seems to use a trade IR group. And sometimes that pops up as press releases, but most of the time, it doesn't as far as Wall Street news services are concerned. Pass that on just as a response.

Speaker 1

You said American Trade, is that the name of the IR?

Speaker 3

I don't know. Whoever there's an IR firm that Kandi America uses.

Speaker 4

I believe that there are some separate IL team. We work in a contract basis for U. S. Entities. But in the group level, we employ 1 IL firm that take care of our public information and with the investor relationship purpose.

Speaker 3

Well, I just find it hard to believe that with everything good that's going on after 15 years with Kandi now, where we used to do 40 press releases a year. Now we're doing almost none when it comes to breaking news. And I think it has to do with the splitting up of the IR responsibilities. Seems like the parent company should be the one to put out the IR, just an opinion. Pass that on, please.

Speaker 4

Yes. I think we will do the related adjustments on the road and you will see the results ongoing. Thank you.

Speaker 3

Okay. On to my corporate rest of my questions. Several years ago, management promised shareholders that once Kandi had predictable growing revenue stream, the company would start giving revenue and earnings guidance, mandatory to attract analysts and institutions, particularly in this competitive stock market. Over the past 3 years, despite a much stronger balance sheet, Kandi's institutional holdings has dropped from a peak of 15% to 3.6%. Can management give any reason why it refuses to confirm to the Wall Street desire for guidance and also non GAAP in addition to GAAP numbers as it did in the last two quarters I'm sorry, as it did in the last 2 years of the prior CFO's term?

Speaker 4

Thank you for your suggestions. We'll further evaluate and complement your suggestion and opinion and implement our procedures. Thank you.

Speaker 3

Okay. Last conference call, saw a response from Mr. Hu that some management would be considered personally buying back shares in the open market as they did 3 years ago when they paid more than double the current price personally and at the time cash in the bank was but a fraction where it is today. Open market company share buybacks are appreciated, but due to Kandi's low daily volume, the 20% average volume maximum number of shares that can be purchased under the current 10b5 plan has been limited to maybe 15,000 or 20,000 shares per day. Why doesn't the company just make a straight $3.50 a share tender offer for at least 10,000,000 shares of stock, which would only use 15% of its cash?

Speaker 3

I doubt it would be fully subscribed due to the stock quickly jumping above that price once shareholders realize management is serious about increasing shareholder value. Most importantly, such an action by an EV related company in this specific market would get a lot of attention that one could not afford to pay for. Okay, pass that on.

Speaker 4

Thank you for your suggestions and we appreciate that. We'll take it into consideration and evaluate and react properly. Thank you.

Speaker 3

Okay. Well, that ends my formal questions that I had for you, but I have just a few questions on what was recently announced today and what we've said on the conference call. I might add that as I addressed earlier in my comments, we keep getting the same thing we'll take under consideration, take under consideration. We've been hearing that for years now. But go ahead and pass that on and then I'll go on to some follow ups on news that just came out.

Speaker 1

Continue, please.

Speaker 3

Okay. These are just some follow ups on what's been said. Regarding the Lowe's 500 stores, I've pulled personally, I know down in my Houston area, at least 3 Lowe's stores and 2 of them actually know the managers in that department and they were under the impression that Lowe's had all 2,500 stores or 24 whatever it is, all 2,400 stores available to be buying Kandi's products. But I guess it's good news if we've been doing what we have with only 500 stores and I can't believe that this NFTEL thing that we're doing now isn't going to probably expand to almost all the stores.

Speaker 1

Please continue.

Speaker 3

Well, that was actually a question, but

Speaker 1

okay. What's the question you said?

Speaker 3

Well, that was a question I had specifically about that subject that I was talking about, about the 500 stores. If they had any further they probably don't have any further comment on that. But anyway, that's just what I've heard from the Lowe's managers. Okay. This one's interesting.

Speaker 3

I've said over the past few years, chiding the company into how soon they think they would be able to pass Polaris. I think Mr. Hu even made a comment on that a few years ago once we got involved in this industry. But what fascinates me is the missing link to Polaris' water sports. Today's press release actually mentioned we're getting into water sports.

Speaker 3

So I'd like more explanation of what that's all about.

Speaker 1

I'm sorry, can I repeat your question one more time?

Speaker 3

Okay. What I'm saying is that in the past, I had chided management by kiddingly asking them how soon they could pass Polaris in this off road vehicle industry. But the missing link at that time to Polaris is Polaris is well known also for its water sports. So my question is, today's press release specifically mentioned water sports as being a new product line you're getting into. Can you expand more on what that water sports is about?

Speaker 1

Okay.

Speaker 4

So first of all, we try to focus on our own development the new product, especially the pure electric off road and then the water sports product. We try not to compete with anyone, but try to focus on our own development. As for the water sports, primarily now in the market, you may see the sports yard or the fishing yard, they are running in the gas, which is noisy and they will hurt the fishing, the ambiance. So we try to research and development into the new products of the pure electric water sports product. And hopefully, we can have more update to share when we have more concrete development.

Speaker 3

Are we talking wave runners here like Polaris has? Or are we just talking like motors for electric motors for fishing boats? What are we specifically talking about in motorsports or both?

Speaker 4

So currently, we are focused in the developing those the water sports in rather small scale like the fishing boat or the yacht for individual, a 1 man yacht kind of scale of the product. That's our category of R and D right now.

Speaker 3

I assume you mean by 1,000,000 yacht wave runners or jet skis?

Speaker 4

Yes, runner jet ski kind of style.

Speaker 3

Oh, that's great. That's super.

Speaker 4

So to be more specific, the jet ski you mentioned, that's the common style we have in the market. But what we try to do is rather not the jet ski, but rather it's like kind of the speedboat or the yacht kind of thing. So we can actually sit in there, but that's only for 1 person size. Is it clear? So it's not really jet ski, but rather the style of the boat or the speedboat kind of thing,

Speaker 3

but

Speaker 4

for only 1 luxury capacity.

Speaker 3

That sounds like a whole new product line. It

Speaker 4

probably happened before. Yes, the new product that we try to innovate for the market, correct. That's on the new style other than the common water sports product in the market right now.

Speaker 3

So it would probably be a patented situation like the Mini was that you released earlier this year?

Speaker 4

That will be our own pattern, our own pattern.

Speaker 3

Another one of our own patterns. Okay, I'm just about done here. The potential is NFL collaboration to me is just incredible. I can imagine maybe you should take off a 6 passenger golf cart and whack off the back seat in it and put a Barton Q Grill back there. People like doing that type of stuff at the sports events in the United States over here.

Speaker 3

But anyway, that's just a comment. So let's see here. Well, I guess the highlight of this was I'm glad to hear that $20.25 estimate of $500,000,000 is still a target of Kandi. Sorry about this.

Speaker 4

It's still I'm

Speaker 3

sorry about the phone ringing over here. Anyway, as I said, I think that that $500,000,000 2025 number should make a dramatic difference in the stock price. If we can just get the story out. Oh, one last question too. You've mentioned that you're already in 10 more 10 big box chains already, if I understood earlier, correct?

Speaker 3

We only know about 5, at least that I'm aware of. So at some point in time, will we be disclosed who the other 5 are?

Speaker 4

For now, we actually start working with those 10 different more than 10 different retail partners at the moment, but then the scale may vary. Some are larger, some are rather relatively smaller. So we're trying not to disclose 1 by 1. But actually on our Kandi American website, you can still see it on the vendor list I mean on the channel list. So for information, please reach our website and down the road, we will try to disclose such information like the search channel, the retail partners we have more frequently and in more details.

Speaker 4

Thank you.

Speaker 3

Okay. Well, thank you very much. A little bit disappointed in the revenues this quarter, but you've done a big expansion and there's a lot involved in getting this stuff to roll out. But this NFL thing sticks in my mind as being something very huge for the latter part of this year and in the future years. But other than that, pretty good job.

Speaker 3

Thank you.

Operator

There are no further questions at this time. I would like to turn the conference back over to management for closing remarks.

Speaker 1

Thank you again for joining today's conference call. If you have any further questions, please don't hesitate to contact our blue shirt at garyblueshirtgroup.co or you can contact us directly at irkandygroup.com. We look forward to updating you on our next earnings call. This concludes our call for today. Thank you very much.

Speaker 1

You may now all disconnect.

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Earnings Conference Call
Kandi Technologies Group Q1 2024
00:00 / 00:00