Kandi Returns to Profitability in Second Quarter; Maintains Forecast of Stronger Second Half With Expected Boost From Electric Car Sales in China
Believes Final Governmental Approval for China COCO Launch Is Imminent

JINHUA, CHINA -- (Marketwire) -- 08/17/09 -- Kandi Technologies, Corp. (NASDAQ: KNDI), an established China-based leader in the design and manufacture of all terrain recreational vehicles, and the designer and manufacturer of the COCO all electric super mini auto, today announced results for its second quarter and first half ended June 30, 2009.

The Company said that results in the quarter continued to be heavily impacted by worldwide economic conditions, particularly in the U.S., which traditionally has accounted for the majority of Kandi's sales. Consequently, sales and net income in the quarter and first half were well below the comparable periods last year. Nevertheless, through careful cost management, the Company reported it was able to achieve a slight profit in the second quarter while continuing to invest in new products. In particular, Kandi said it is awaiting what it believes will be final approvals from Chinese authorities to launch sales in China of its battery powered COCO super mini car, which the Company believes will contribute significantly to a second half turnaround.

A Small Profit

The Company reported that revenues in the second quarter of 2009 were $5,481,551 compared with $12,424,373 in the same period last year, as sales in particular of the Company's ATRVs were impacted by the recession. By adjusting costs to align with recession impacted sales, the Company said it achieved net income of $226,373 or $0.01 per share in the period, compared with net income of $2,436,451 or $0.12 per share in the same period last year.

While revenues in the quarter and first six months of 2009 sharply declined, the expenditure for R&D increased 318% through the first six months and more than 159% in the quarter. This is a reflection of the Company's commitment to building a strong sales presence in China, not only with its battery powered car, but also with other new products such as its four-wheel drive "Farmer's Pickup" aimed at the Chinese agricultural market and expected to be launched by year end.

Through the first half of 2009, revenues were $9,487,455, down 56.4% from $21,753,075 in the same period a year earlier. Reflecting the first quarter loss reported by the Company, the loss in the first six months of 2009 was $(356,525), or $(0.02) per share, compared with net income in the first half of 2008 of $3,510,413, or $0.18 per share.

Focus Is On COCO Launch In China

Mr. Xiaoming Hu, Chairman and CEO of the Company, stated, "As we are operating in a very difficult environment, we were pleased to have stemmed our losses, while also making substantial progress in our plan to achieve at least 50% of our sales this year in China, where economic conditions currently are much more favorable than in the rest of the world. Our main focus has been on developing our new battery powered COCO super mini car, for which we have established a production facility ready to roll out cars for the Chinese market as soon as we attain final governmental approval. We believe that following months of successful testing this approval is imminent."

He continued, "While awaiting final approval, we have been quite busy preparing dealers and the Chinese market for the COCO which, in addition to its striking appearance, has numerous features we think will appeal to cost conscious Chinese commuters. While the amount of the announced government grant to individual COCO purchasers has not been finalized, we expect it will be substantial -- making the COCO especially affordable -- and, of course, it will be running on batteries rather than gasoline."

Government Sales Support Sales Targets

"Recently," Mr. Hu added, "we announced that we have been targeting sales of our electric cars not only at individual consumers in China, but also at government agencies. We have signed letters of intent with two Postal Service branches for what we believe will be fleet purchases, a program that could be replicated nationally. This is a program we are continuing to pursue and is a key factor underlying our previously announced full year sales projections."

The Company said it also continues to focus on other new products it believes are potential strong sellers in the U.S., even in the current environment. Among them is a new high mileage, two-seater, three-wheeled motorcycle that achieved some success in the second quarter and is expected to attract additional consumers in the period ahead.

"During the quarter," Mr. Hu said, "we also recorded some initial sales in the U.S. of our electric COCO convertible and are continuing to ship the vehicle based on demand from dealers there."

Outlook

"Looking ahead," Mr. Hu said, "we are very excited about second half prospects once the COCO is launched in China. If successful, we believe we will be the first Company to mass produce an electric vehicle, setting the stage for what we think will be sustainable growth in years to come with a product that meets the needs of the times. We see great opportunity in China, but by no means will abandon our sales efforts worldwide, where Kandi's products have become increasingly well known for their performance, high quality and curb appeal."

About the Company

In 2008, Kandi Technologies, Corp. (NASDAQ: KNDI) generated nearly $41 million in sales and profits of about $5 million, principally from its core All Terrain Recreational Vehicle (ATRV) business. The Company ranks as one of the largest manufacturers and exporters of go-karts in China, making it a world leader in the production of this increasingly popular recreational vehicle. It also ranks among the leading manufacturers in China of all terrain vehicles (ATVs). A more recent Company focus has been on specialized utility vehicles (UTVs), especially for agricultural purposes. The Company also is launching a second generation high mileage, two seater three-wheeled motorcycle, and a highly economical, beautifully designed, super mini car -- the COCO -- for neighborhood driving and commuting. Kandi believes that battery powered, electric super mini cars will become the Company's largest revenue and profit generator. While nearly all Kandi products historically have been exported, including more than 65% to the U.S., the Company is intensifying efforts to shift 50% of its sales to China where markets have continued to be strong.

The Company's products can be viewed at http://www.chinakandi.com.

Information Regarding Forward-Looking Statements

Except for historical information contained herein, the statements in this Press Release are forward-looking statements that are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve known and unknown risks and uncertainties, which may cause our actual results in future periods to differ materially from forecasted results. These risks and uncertainties include, among other things, product demand, market competition, and risks inherent in our operations. These and other risks are described in our filings with the Securities and Exchange Commission.

                        KANDI TECHNOLOGIES, CORP.
                             AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME
                                  (LOSS)
                                (UNAUDITED)

                        Three Months Ended           Six Months Ended
                    -------------------------  ---------------------------
                      June 30,     June 30,      June 30,      June 30,
                        2009         2008          2009          2008
                    -----------  ------------  -----------  --------------

REVENUES, NET       $ 5,481,551  $ 12,424,373  $ 9,487,455  $   21,753,075


COST OF GOODS SOLD   (4,037,629)   (9,139,131)  (7,063,351)    (16,316,178)
                    -----------  ------------  -----------  --------------

GROSS PROFIT          1,443,922     3,285,242    2,424,104       5,436,897
                    -----------  ------------  -----------  --------------
Research and
 development            580,772       224,146    1,106,973         264,816
Selling and
 distribution
 expenses                97,810       180,596      183,994         409,102
General and
 administrative
 expenses               363,103       432,238      930,918         704,682
Stock based
 compensation
 expense                315,175             -      525,292               -
                    -----------  ------------  -----------  --------------
INCOME (LOSS) FROM
 OPERATIONS              87,062     2,448,262     (323,073)      4,058,297

Interest expense,
 net                   (109,253)     (395,087)    (418,557)     (1,009,699)
Government grants        24,951        17,274      124,005          40,574
Other income, net       245,971        (1,948)     302,185          20,047
                    -----------  ------------  -----------  --------------
INCOME (LOSS) FROM
 OPERATIONS BEFORE
 INCOME TAXES           248,731     2,068,501     (315,440)      3,109,219

INCOME TAX
 (EXPENSE) BENEFIT      (22,358)       33,920      (41,085)         73,660
                    -----------  ------------  -----------  --------------

INCOME (LOSS) FROM
 CONTINUING
 OPERATIONS             226,373     2,102,421     (356,525)      3,182,879
                    -----------  ------------  -----------  --------------


DISCONTINUED
 OPERATION
Loss from
 discontinued
 operation                    -       (34,219)           -         (33,379)
Gain from
 disposition of
 discontinued
 operation                    -       368,249            -         360,913
NET GAIN FROM
 DISCONTINUED
 OPERATION                    -       334,030            -         327,534
                    -----------  ------------  -----------  --------------

NET INCOME (LOSS)       226,373     2,436,451     (356,525)      3,510,413
                    -----------  ------------  -----------  --------------



                        KANDI TECHNOLOGIES, CORP.
                             AND SUBSIDIARIES
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (LOSS) AND COMPREHENSIVE INCOME
                                  (LOSS)
                                (UNAUDITED)



                              Three Months Ended       Six Months Ended
                            ----------------------- ----------------------
                             June 30,    June 30,    June 30,    June 30,
                               2009        2008        2009        2008
                            ----------- ----------- ----------  -----------
OTHER COMPREHENSIVE INCOME
Foreign currency
 translation                     16,121      93,622     28,419      350,834
                            ----------- ----------- ----------  -----------
COMPREHENSIVE (LOSS) INCOME     242,494   2,530,073   (328,106)   3,861,247
                            =========== =========== ==========  ===========

WEIGHTED AVERAGE SHARES
 OUTSTANDING BASIC           19,961,000  19,961,000 19,961,000   19,961,000
                            ----------- ----------- ----------  -----------
WEIGHTED AVERAGE SHARES
 OUTSTANDING DILUTED         21,126,517  19,961,000 19,961,000   19,961,000
                            =========== =========== ==========  ===========

NET INCOME (LOSS) PER SHARE
 FROM CONTINUING
 OPERATIONS, BASIC          $      0.01 $      0.11 $    (0.02) $     0.16
                            ----------- ----------- ----------  -----------
NET INCOME (LOSS) PER SHARE
 FROM CONTINUING
 OPERATIONS, DILUTED        $      0.01 $      0.11 $    (0.02) $     0.16
                            =========== =========== ==========  ===========

NET INCOME PER SHARE FROM
 DISCONTINUED OPERATIONS,
 BASIC AND DILUTED          $         - $      0.01 $        -  $      0.01
                            =========== =========== ==========  ===========

NET INCOME (LOSS) PER
 SHARE, BASIC               $      0.01 $      0.12 $    (0.02) $      0.18
                            ----------- ----------- ----------  -----------
NET INCOME (LOSS) PER
 SHARE, DILUTED             $      0.01 $      0.12 $    (0.02) $      0.18
                            =========== =========== ==========  ===========



Contacts:
Kandi Technologies, Corp.
Hu Xiaoming
President and CEO
86-579 83906856

US Investors

Focus Asia Partners
Robert Agriogianis
Tel: 973-845-6642
Fax: 973-845-6649

Press

Ken Donenfeld
donfgroup@aol.com
Tel: 212-425-5700
Fax: 646-381-9727

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