EHang Reports First Quarter 2021 Unaudited Financial Results

– Achieved Quarterly Positive Operating Cash Flow Again
– Maintained High Quarterly Gross Margin

GUANGZHOU, China, Aug. 25, 2021 (GLOBE NEWSWIRE) — EHang Holdings Limited (“EHang” or the “Company”) (Nasdaq: EH), the world’s leading autonomous aerial vehicle (“AAV”) technology platform company, today announced its unaudited financial results for the first quarter ended March 31, 2021.

First Quarter 2021 Financial and Operational Highlights

Total revenues were RMB23.0 million (US$3.5 million), up 22.1% year-over-year, with growth mainly in air mobility solutions. Revenues from air mobility solutions contributed 98.4% of the total revenues in the first quarter of 2021.

Gross margin was 63.2%, an increase of 3.9 percentage points year-over-year, driven by continuous optimization of cost structure of air mobility products and the change in revenue mix.

Operating loss was RMB66.2 million (US$10.1 million), compared with operating loss of RMB21.1 million in the first quarter of 2020. The change in operating loss was mainly due to the increase in share-based compensation expenses charged to operating expenses.

Adjusted operating loss1 (non-GAAP) was RMB17.3 million (US$2.6 million), compared with adjusted operating loss of RMB19.2 million in the first quarter of 2020.

Net loss was RMB62.5 million (US$9.5 million), compared with net loss of RMB20.4 million in the first quarter of 2020.

Adjusted net loss2 (non-GAAP) was RMB13.7 million (US$2.1 million), compared with adjusted net loss of RMB18.5 million in the first quarter of 2020.

Net cash from operating activities was RMB16.2 million (US$2.5 million), a significant growth compared to negative RMB29.1 million in the first quarter of 2020.

Cash and cash equivalents and short-term investments amounted to RMB480.5 million (US$73.3 million) as of March 31, 2021, mainly due to the US$40 million investment from Carmignac and the positive net cash from operating activities achieved.

Sales of the EHang 216 series of passenger-grade AAVs, were 15 units, compared with 9 units in the first quarter of 2020.
First Quarter 2021 Business Highlights

Trial Flights to Initiate an Urban Air Mobility (“UAM”) Plan in the Hengqin New Area in Southern China
In January, EHang announced strategic partnerships with local partners to jointly initiate trial air mobility operations in the Hengqin New Area (“Hengqin”), the largest of the islands surrounding Zhuhai city in the Guangdong-Hong Kong-Macao Greater Bay Area of China. A total of 36 passengers experienced trial flights for aerial sightseeing in Hengqin on the announcement date. In February, the local partner further carried out the first trial flights of the EHang 216 over the sea of southern China from Hengqin to Dong’ao Island, a tourist destination island, showcasing its potential application in air mobility use cases such as aerial sightseeing.

Trial Flights of Passenger-grade AAVs for the First Time in Beijing
In February, EHang completed trial flights of the EHang 216 in Beijing in a cold weather at an air temperature of minus 14 degrees Celsius to demonstrate the safety, reliability and environmental adaptability of its cutting-edge AAV technologies. This was also the first time that passenger-grade AAVs flew in Beijing, the capital city of China.

Participation in a Series of UAM Projects Supported by the European Union
In January and February, as a pioneer of cutting-edge AAV products and technological solutions, EHang was selected to participate in a series of UAM projects supported by the European Union to demonstrate ways to achieve safe, sustainable, socially acceptable, and effective UAM. These projects include: 1) the Air Mobility Urban – Large Experimental Demonstration (“AMU-LED”) project in Spain, the United Kingdom and the Netherlands; 2) the Re-Invent Air Mobility initiative in France; 3) the Safe and Flexible Integration of Advanced U-Space Services for Medical Air Mobility (“SAFIR-Med”) project in Belgium, Germany, the Netherlands, Greece and Czech Republic; and 4) the GOF 2.0 Integrated Urban Airspace VLD.

Partnership with Giancarlo Zema Design Group to Build an Eco-sustainable Vertiport in Italy
In March, EHang entered into a partnership with Giancarlo Zema Design Group (“GZDG”), a leading Italian architecture firm. GZDG has designed and intends to build an eco-sustainable vertiport in Italy using EHang’s passenger-grade AAV technologies and air mobility solutions. The vertiport will use green design and construction materials and can generate energy to recharge the EHang 216 AAVs.

Partnership with Dongfeng USharing to Co-develop a Solution for Seamlessly-Connected Mobility Services Leveraging AAV Technologies
In March, EHang entered into a partnership with Dongfeng USharing Technology Co., Ltd., a subsidiary of Dongfeng Motor Corporation (a Fortune Global 500 company and one of the largest auto makers in China) to co-develop a solution for Seamlessly Connected Mobility Services for logistics using EHang’s AAV technologies.

CEO Remarks

“We started the year of 2021 with a 22.1% year-over-year revenue growth in the first quarter, achieved again quarterly positive operating cash flow and maintained high quarterly gross margin at 63.2%. All of these reflected our growing competitive strengths,” said Mr. Huazhi Hu, EHang’s Founder, Chairman and Chief Executive Officer. “Upon entering 2021, we focused more on our core business in air mobility solutions through expanding our trial operation programs and industrywide partnerships for UAM powered by our cutting-edge AAV products and technologies to gain robust growth momentum into the near future.”

First Quarter 2021 Financial Results

Revenues

Total revenues were RMB23.0 million (US$3.5 million), up 22.1% year-over-year, with growth mainly in air mobility solutions. Revenues from air mobility solutions represented 98.4% of the total revenues in the first quarter of 2021. Sales of the EH216, the Company’s flagship passenger-grade AAV, were 15 units (including 1 unit of the customized EH216L) in the first quarter of 2021, compared with 9 units in the same period of 2020.

Costs of revenues

Costs of revenues were RMB8.5 million (US$1.3 million), up 10.3% year-over-year, primarily due to the change in the sales volume of AAV products.

Gross profit

Gross profit was RMB14.5 million (US$2.2 million), up 30.2% from RMB11.2 million in the first quarter of 2020.

Gross margin was 63.2%, up 3.9 percentage points from 59.3% in the first quarter of 2020. The increase in gross margin was mainly due to the continuous optimization of cost structure of air mobility products.

Operating expenses

Total operating expenses were RMB83.4 million (US$12.7 million), up 152.4% from RMB33.0 million in the first quarter of 2020. Operating expense as a percentage of total revenues was 363.0%, compared with 175.6% in the first quarter of 2020. The increase in operating expenses was primarily due to an increase of RMB46.9 million (US$7.2 million) in share-based compensation expenses and the charges to sales and marketing expenses, general and administration expenses and research and development expenses were RMB4.6 million (US$0.7 million), RMB34.9 million (US$5.3 million) and RMB7.4 million (US$1.2 million), respectively.

Adjusted operating expenses3 (non-GAAP)

Adjusted operating expenses were RMB34.5 million (US$5.3 million), representing an increase of 11.0% from RMB31.1 million in the first quarter of 2020. Adjusted operating expenses as a percentage of total revenues was 150.3%, compared with 165.3% in the first quarter of 2020.

Adjusted sales and marketing expenses were RMB4.9 million (US$0.8 million), down 15.9% from RMB5.8 million in the first quarter of 2020. The decrease was mainly due to the decrease in market promotion and professional expenses in the first quarter of 2021.

Adjusted general and administration expenses were RMB9.7 million (US$1.5 million), up 6.2% from RMB9.2 million in the first quarter of 2020.

Adjusted research and development expenses were RMB19.9 million (US$3.0 million), up 23.3% from RMB16.2 million in the first quarter of 2020. The increase was mainly due to increased R&D material and personnel expenses in the first quarter of 2021.
Operating loss

Operating loss was RMB66.2 million (US$10.1 million), compared with operating loss of RMB21.1 million in the first quarter of 2020. Operating loss as a percentage of total revenues was negative 288.1%, compared with negative 112.2% in the first quarter of 2020.

Adjusted operating loss (non-GAAP)

Adjusted operating loss was RMB17.3 million (US$2.6 million), compared with adjusted operating loss of RMB19.2 million in the first quarter of 2020. Adjusted operating loss as a percentage of total revenues was negative 75.4%, compared to negative 102.0% in the first quarter of 2020.

Net loss

Net loss was RMB62.5 million (US$9.5 million), compared with net loss of RMB20.4 million in the first quarter of 2020.

Adjusted net loss (non-GAAP)

Adjusted net loss was RMB13.7 million (US$2.1 million), compared with adjusted net loss of RMB18.5 million in the first quarter of 2020.

Adjusted net loss attributable to EHang’s ordinary shareholders was RMB13.3 million (US$2.0 million).

Loss per share and per ADS

Basic and diluted net loss per ordinary share were both RMB0.56 (US$0.09). Adjusted basic and diluted net loss per ordinary share4 (non-GAAP) were both RMB0.12 (US$0.02).

Basic and diluted net loss per ADS were both RMB1.12 (US$0.18). Adjusted basic and diluted net loss per ADS5 (non-GAAP) were both RMB0.24 (US$0.04). Each ADS represents two Class A ordinary shares.

Balance Sheet and Cash Flow

The cash, cash equivalents, restricted cash and short-term investments balances were RMB480.5 million (US$73.3 million) as of March 31, 2021, compared to RMB189.4 million as of December 31, 2020. The increases were mainly due to the US$40 million investment from Carmignac and the positive net cash from operating activities of RMB16.2 million (US$2.5 million), a significant growth compared to negative RMB29.1 million in the first quarter of 2020.

Business Outlook

The Company’s revenue forecast for 2021 remains between RMB130 million and RMB180 million, as the Company strategically transitions into a more operation platform-oriented model and the commercialization of the EHang 216F, the firefighting model, among other AAVs.

The above outlook is based on information available as of the date of this press release and reflects the Company’s current and preliminary expectations regarding its business situation and market conditions. The outlook is subject to change, especially considering uncertainties and situations related to how the COVID-19 pandemic further develops.

Conference Call

EHang’s management team will host an earnings conference call at 8:00 AM on Wednesday, August 25, 2021, U.S. Eastern Time (8:00 PM on August 25, 2021, Beijing/Hong Kong Time).

Please register in advance for the conference using the link provided below and dial in 10 minutes before the conference is scheduled to begin. Conference access information will be provided upon registration.

Participant Online Registration: http://apac.directeventreg.com/registration/event/8598052.

A replay of the conference call may be accessed by phone at the following numbers until September 2, 2021. To access the replay, please reference the conference ID 8598052.

Phone Number
International +61 2 8199 0299
United States +1 855 452 5696
+1 646 254 3697
Hong Kong +852 800963117
Mainland China +86 4006322162
+86 8008700205
A live and archived webcast of the conference call will be available on the company’s investors relations website at http://ir.ehang.com/.