SunCar Technology Reports 29% Revenue Growth, Including 79% Increase in Auto e-Insurance Business in FY 2023

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Adjusted EBITDA increased by $7.2 million to $1.6 million in 2023

Conference Call and Webcast on April 30th at 5 PM ET

NEW YORK, April 29, 2024 /PRNewswire/ -- SunCar Technology Group Inc. (the "Company" or "SunCar") (NASDAQ: SDA), an innovative leader in cloud-based B2B auto services and auto e-insurance in China, today provided a business update and reported financial results for the year ended December 31, 2023.

Fiscal Year 2023 Financial Results

  • For the fiscal year ended December 31, 2023, total revenues were $364 million, up 29% from $282 million in 2022.
    • Our auto service segment reported revenue of $215 million in fiscal year 2023, an increase of 8% from $199 million in fiscal year 2022. The increase was driven by the increase in service orders in 2023. This segment is enabled by SunCar's technology platform, which facilitates auto services, such as car wash, maintenance, driving service, and road assistance.
    • Our auto eInsurance segment generated $118 million in fiscal year 2023, a 75% increase over fiscal year 2022. This growth was driven by an increase in gross premiums written and the number of insurance policies issued compared to the year ended December 31, 2022. Specifically, we experienced over 100% YoY revenue growth driven by our strong relationships with electric vehicle manufacturers, including Tesla (NASDAQ: TSLA), NIO (NYSE: NIO), X Peng (NYSE: XPEV), and Li Auto (NASDAQ: LI), Xiaomi (HKSE: 01810), BYD (HKSE: 01211), Seres Group (SHSE: 601127), ZEEKR, Lotus Technology (NASDAQ: LOT), Leapmotor (HKSE: 09863), JIDU Auto (a joint venture between Baidu (NASDAQ: BIDU) and Geely (HKSE: 0175), and others.
    • Our technology service business generated revenues of $31 million for the year ended December 31, 2023, a 98% increase over 2022. This increase is due to our continuous expansion in new business to acquire more market share and to the increasing adoption of insurance companies of our eInsurance technology.
    • Our net losses were $18 million and $12 million for the year ended December 31, 2023 and 2022, respectively. We continue to strategically invest in technology and business development as we increase our presence with some of the largest enterprise customers in China.
    • Adjusted EBITDA, a non-GAAP metric that excludes certain non-recurring items and non-cash expenses, is useful in evaluating our operational performance in addition to the GAAP metrics. Our Adjusted EBITDA increased by $7.2 million from the year ended December 31, 2022, to a positive $1.6 million in the year ended December 31, 2023.

Fiscal Year 2023 Operational Highlights

  • For our auto service business, the Company was working with over 1,400 enterprise clients and over 47,000 auto service providers (compared to 45,000 as of December 31, 2022), covering over 350 cities and all 33 provinces of China.
    • Announced auto service agreements and renewals with China Minsheng Banking Corp., Ltd. (CMBC), Bank of Communications Limited (BoComm), China CITIC Bank, and the Heilongjiang Branch of the Agricultural Bank of China.
  • For our auto eInsurance business, the Company was working with 85 insurance companies (including the top 10 insurance companies with a combined over 90% market share), over 900 insurance company branches, and over 64,000 insurance sales partners (compared to 62,000 in 2022) in China.
    • Announced auto eInsurance agreements and renewals with Tesla (NASDAQ: TSLA), Nio (NYSE: NIO), Li Auto (NASDAQ: LI), XPeng (NYSE: XPEV).
  • Closed our business combination with Goldenbridge Acquisition Limited and listed our shares on the Nasdaq in May 2023.



  • We released Version 7.9.0 of our eInsurance system with new features, including enhanced automatic storage and management of insurance image data.
    • Currently deployed by 18 leading NEV companies, it aims to enhance user experience to the best-in-class in the industry.

Management Commentary

Ye Zaichang, CEO and Chairman of SunCar commented, "At SunCar, we're leveraging cutting-edge technology to revolutionize the auto services and eInsurance sectors in China, the world's largest and rapidly growing vehicle market. Our cloud-based platform seamlessly connects car owners with a vast array of services and eInsurance options, tapping into a network of over 47,000 service providers and more than 64,000 insurance sales partners nationwide."

"In 2023, we achieved a significant revenue increase to $364 million, up 29% from the previous year, demonstrating the strong synergy between our auto services and eInsurance segments. Our robust technology infrastructure propels this success, including seamless API integrations and an AI-powered purchasing process that significantly enhances customer experience. With our strategic focus on the burgeoning electric vehicle sector and partnerships with top EV manufacturers, we are uniquely positioned to drive continued growth and innovation in this dynamic industry."

"I extend my heartfelt thanks to our team, partners, and shareholders for their unwavering support as we move forward with our vision to transform automotive service and insurance in China."

CONFERENCE CALL & AUDIO WEBCAST

SunCar will host a conference call on Tuesday, April 30, at 5:00 PM ET (2:00 PM PT) with the investment community to discuss the Company's financial results and provide a business update.

To access the call by phone, please dial 1-877-407-0752 (international callers please dial 1-201-389-0912) approximately 10 minutes prior to the start of the call. A live audio webcast of the conference call will be available online at https://viavid.webcasts.com/starthere.jsp?ei=1668638&tp_key=73879e5f16.

A webcast replay will also be available for a limited time at the following link: https://viavid.webcasts.com/starthere.jsp?ei=1668638&tp_key=73879e5f16.

About SunCar Technology Group Inc.

Originally founded in 2007, SunCar is transforming the customer journey for auto services and auto insurance in China, the largest passenger vehicle market in the world. SunCar develops and operates cloud-based platforms that seamlessly connect drivers with a wide range of auto services and insurance coverage options through a nationwide network of sales partners. As a result, SunCar has established itself as the leader in China in the B2B auto services market and the auto eInsurance market for electric vehicles. The Company's multi-tenant, cloud-based platform empowers its enterprise clients to access and manage their customer database and offerings optimally, and drivers gain access to hundreds of services from tens of thousands of independent providers in a single application. For more information, please visit: https://suncartech.com

Forward-Looking Statements

This press release contains information about the Company's view of its future expectations, plans and prospects that constitute forward-looking statements. Actual results may differ materially from historical results or those indicated by these forward-looking statements as a result of a variety of factors including, but not limited to, risks and uncertainties associated with its ability to raise additional funding, its ability to maintain and grow its business, variability of operating results, its ability to maintain and enhance its brand, its development and introduction of new products and services, the successful integration of acquired companies, technologies and assets into its portfolio of products and services, marketing and other business development initiatives, competition in the industry, general government regulation, economic conditions, dependence on key personnel, the ability to attract, hire and retain personnel who possess the technical skills and experience necessary to meet the requirements of its clients, and its ability to protect its intellectual property. The Company encourages you to review other factors that may affect its future results in the Company's annual reports and in its other filings with the Securities and Exchange Commission.

Contact Information:

SunCar:

Investor Relations: Ms. Hui Jiang

Email: IR@suncartech.com

Legal: Ms. Li Chen

Email: chenli@suncartech.com

U.S. Investor Relations

Matthew Abenante, IRC

President

Strategic Investor Relations, LLC

Tel: 347-947-2093

Email: matthew@strategic-ir.com 

*** tables follow ***

SUNCAR TECHNOLOGY GROUP INC



CONSOLIDATED BALANCE SHEETS



(In U.S. Dollar thousands, except for share and per share data, or otherwise noted)











As of December 31,







2022





2023

















ASSETS













Current assets













Cash



$

21,200





$

30,854



Restricted cash





2,717







2,741



Short-term investments





26,544







21,596



Accounts receivable, net





85,619







56,043



Prepaid expenses and other current assets, net





9,270







63,963



Total current assets





145,350







175,197





















Non-current assets

















Long-term investment





290







282



Software and equipment, net





18,491







22,466



Deferred tax assets, net





13,070







11,998



Other non-current assets





14,423







12,012



Right-of-use assets





344







1,280



Total non-current assets





46,618







48,038



TOTAL ASSETS



$

191,968





$

223,235





















LIABILITIES AND SHAREHOLDERS' EQUITY

















Current liabilities

















Short-term loan



$

74,653





$

83,029



Accounts payable





24,200







26,641



Deferred revenue





3,569







3,050



Tax payables





2,042







1,364



Accrued expenses and other current liabilities





4,849







4,809



Amount due to a related party, current





45,564







4,751



Operating lease liability, current





315







748



Total current liabilities





155,192







124,392





















Non-current liabilities

















Operating lease liability, non-current





-







504



Amount due to a related party, non-current





-







29,688



Warrant liabilities





-







661



Total non-current liabilities





-







30,853



Total liabilities



$

155,192





$

155,245





















Shareholders'(deficit)/equity

















Class A Ordinary shares* (par value of US$0.0001 per share;

400,000,000 Class A Ordinary shares authorized as of December 31,

2022 and 2023, respectively; 31,971,435 and 39,876,493 Class A

Ordinary shares issued and outstanding as of December 31, 2022 and

2023, respectively)



$

3





$

4



Class B Ordinary shares* (par value of US$0.0001 per share;

100,000,000 Class B Ordinary shares authorized as of December 31,

2022 and 2023, respectively; 49,628,565 and 49,628,565 Class B

Ordinary shares issued and outstanding as of December 31, 2022 and

2023, respectively)





5







5



Additional paid in capital





95,764







144,160



Accumulated deficit





(99,580)







(129,724)



Accumulated other comprehensive loss





(1,476)







(1,367)



Total SUNCAR TECHNOLOGY GROUP INC's shareholders'

(deficit)/equity





(5,284)







16,078



Non-controlling interests





42,060







51,912



Total equity





36,776







67,990



TOTAL LIABILITIES AND EQUITY



$

191,968





$

223,235



 

 

SUNCAR TECHNOLOGY GROUP INC



CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE

INCOME (LOSS)



(In U.S. Dollar thousands, except for share and per share data, or otherwise noted)











For the year ended December 31,







2021





2022





2023























Revenues



















Auto service



$

187,880





$

199,294





$

214,979



Auto eInsurance





56,766







67,640







118,109



Technology service





4,589







15,479







30,658



Total revenues





249,235







282,413







363,746





























Operating cost and expenses

























Integrated service cost





(156,852)







(166,793)







(209,553)



Promotional service expenses





(55,222)







(65,500)







(112,504)



Selling expenses





(12,731)







(16,477)







(20,578)



General and administrative expenses





(10,420)







(37,742)







(22,462)



Research and development expenses





(3,651)







(8,478)







(14,111)



Total operating costs and expenses





(238,876)







(294,990)







(379,208)



Operating profit/(loss)





10,359







(12,577)







(15,462)





























Other income/(expenses)

























Financial expenses, net





(3,045)







(3,659)







(4,435)



Investment income





759







441







518



Change of fair value of warrant liabilities





-







-







(629)



Other income, net





2,457







5,121







5,001



Total other income, net





171







1,903







455





























Income/(loss) before income tax expense





10,530







(10,674)







(15,007)



Income tax expense





(938)







(231)







(2,572)



Income/(Loss) from continuing operations, net of

   tax





9,592







(10,905)







(17,579)





























Discontinued operations:

























Net loss from the operations of the discontinued

   operations, net of tax





(27,682)







(994)







-



Net loss





(18,090)







(11,899)







(17,579)





























Net income/(loss) from continuing operations





9,592







(10,905)







(17,579)



    Less: Net income/(loss) attributable to non-controlling

       interests of continuing operations





5,650







(5,230)







9,333



Net income/(loss) from continuing operations

   attributable to the Company's ordinary

   shareholders





3,942







(5,675)







(26,912)





























Loss from discontinued operations, net of tax





(27,682)







(994)







-



Less: Net loss attributable to non-controlling interests of

    discontinue operations





(19)







-







-



   Net loss from discontinued operations attributable

       to the Company's ordinary shareholders





(27,663)







(994)







-



Net loss attributable to the Company's ordinary

    shareholders





(23,721)







(6,669)







(26,912)





























Net income/(loss) per ordinary share from continuing

   operations:

























Basic and diluted



$

0.05





$

(0.07)





$

(0.31)





























Net loss per ordinary share from discontinued

   operations:

























Basic and diluted



$

(0.34)





$

(0.01)





$

-





























Net loss attributable to the Company's ordinary

   shareholders per ordinary share

























Basic and diluted



$

(0.29)





$

(0.08)





$

(0.31)





























   Weighted average shares outstanding used in

      calculating basic and diluted loss per share

























Basic and diluted





81,600,000







81,600,000







85,441,057





























Income/ (loss) from continuing operations before non-

   controlling interests



$

9,592





$

(10,905)





$

(17,579)



Loss from discontinued operations, net of tax





(27,682)







(994)







-



Net loss





(18,090)







(11,899)







(17,579)



Other comprehensive income/(loss)

























Foreign currency translation difference





907







(2,410)







(1,137)



Total other comprehensive income/(loss)





907







(2,410)







(1,137)





























Total comprehensive loss





(17,183)







(14,309)







(18,716)



Less: total comprehensive income/(loss) attributable to

   non-controlling interest





6,839







(9,801)







8,087



   Total comprehensive loss attributable to the

      SUNCAR TECHNOLOGY GROUP INC's

      shareholders



$

(24,022)





$

(4,508)





$

(26,803)



 

 

SUNCAR TECHNOLOGY GROUP INC



CONSOLIDATED STATEMENTS OF CASH FLOWS



(In U.S. Dollar thousands, except for share and per share data, or otherwise noted)











For the years ended

December 31,







2021





2022





2023



CASH FLOWS FROM OPERATING ACTIVITIES:



















Net income/(loss) from continuing operations



$

9,592





$

(10,905)





$

(17,579)



Net loss from discontinued operations





(27,682)







(994)







-



Net loss





(18,090)







(11,899)







(17,579)



Adjustments to reconcile net income (loss) to net cash

   provided by (used in) operating activities:

























Provision (Reversal) for credit losses





148







25,981







(4,112)



Depreciation and amortization





4,055







5,078







4,114



Amortization of right-of-use assets





-







619







754



Share-based compensation of subsidiary





1,668







1,599







1,519



Share-based compensation of the Group





-







-







9,776



Loss/(gain) on disposal of software and equipment





27







-







(27)



Deferred income tax (benefit) expense





(1,124)







(1,951)







701



Fair value changes of warrant liabilities





-







-







629



Financing expense related to issuance of GEM Warrants





-







-







377



Changes in operating assets and liabilities:

























Accounts receivable





(35,071)







(32,640)







30,822



Prepaid expenses and other current assets





3,181







(3,850)







(55,908)



Accounts payable





13,608







(5,019)







3,140



Deferred revenue





813







1,858







(418)



Accrued expenses and other current liabilities





(14,976)







2,548







(288)



Tax payable





(1,026)







(280)







(621)



Operating lease liabilities





-







(615)







(680)



Amount due to a related party





-







1,485







150



Net cash used in operating activities of continuing

   operations





(19,105)







(16,092)







(27,651)



Net cash used in operating activities of discontinued

   operations





(6,462)







(52)







-



Total net cash used in operating activities





(25,567)







(16,144)







(27,651)





























CASH FLOWS FROM INVESTING ACTIVITIES

























Purchase of software and equipment





(1,284)







(4,351)







(4,928)



Proceeds from disposal of software and equipment





-







-







54



Purchase of short-term investment





(9,839)







-







(518)



Proceeds from the redemption of short-term investment





-







149







4,719



Purchase of other non-current assets





(8,968)







(1,200)







(1,721)



Net cash (used in) provided by investing activities of

   continuing operations





(20,091)







(5,402)







(2,394)



Net cash used in investing activities of discontinued

   operations





(591)







(517)







-



Total net cash (used in) provided by investing activities





(20,682)







(5,919)







(2,394)





























CASH FLOWS FORM FINANCING ACTIVITIES

























Proceeds from short-term loan





76,812







122,249







104,506



Repayments of short-term loan





(70,193)







(111,103)







(93,970)



Repayments of payables to a related party





-







-







(10,000)



Proceeds from issuance of ordinary shares, net of issuance

   cost





-







-







18,468



Cash required on reverse recapitalization





-







-







68



Proceeds from Private Placement





-







-







21,737



Payment for offering cost related to Business Combination





-







-







(588)



Shares repurchase





-







-







(2,000)



Exercise of warrants





-







-







2,213



Repurchase of non-controlling interests





(1,184)







(510)







-



Dividend paid to non-controlling shareholders





(6,620)







-







-



Net cash (used in) provided by financing activities of

   continuing operations





(1,185)







10,636







40,434



Net cash provided by financing activities of discontinued

   operations





1,119







-







-



Total net cash (used in) provided by financing activities





(66)







10,636







40,434





























Effect of exchange rate changes





1,827







(2,573)







(711)





























Net change in cash and restricted cash





(44,488)







(14,000)







9,678





























Cash and restricted cash, beginning of the year



$

82,405





$

37,917





$

23,917



Cash and restricted cash, end of the year



$

37,917





$

23,917





$

33,595





























Less: cash of discontinued operations at end of year





570







-







-



Cash and restricted cash at end of year for continuing

   operations



$

37,347





$

23,917





$

33,595





























Reconciliation of cash and restricted cash to the

   consolidated balance sheets:

























Cash



$

34,517





$

21,200





$

30,854



Restricted cash



$

2,830





$

2,717





$

2,741



Total cash and restricted cash



$

37,347





$

23,917





$

33,595





























Supplemental disclosures of cash flow information:

























Income tax paid



$

3,472





$

2,459





$

-



Interest expense paid



$

3,087





$

3,780





$

2,577





























Supplemental disclosures of non-cash activities:

























Disposal of Shengda Group





-







23,222







-



Decrease of accrued expenses and other current liabilities due

   to vest of restricted shares



$

311





$

311





$

-



Purchase of software and equipment by using accrued

    expenses and other current liabilities



$

-





$

-





$

-



Obtaining right-of-use assets in exchange for operating lease

   liabilities and prepaid expenses



$

-





$

972





$

1,702



Software and equipment transferred from other non-current

   assets



$

-





$

12,150





$

3,727,781



Prepaid financing expense related to issuance of GEM

   Warrants



$

-





$

-





$

1,441,826



 

Non-GAAP Financial Measures

In addition to our results determined in accordance with GAAP, the Company's management believes that Adjusted EBITDA, which is a non-GAAP measure that excludes certain non-recurring items such as costs and expenses related to the Business Combination and prior and subsequent capital raises, is useful in evaluating our operational performance. The Company uses this non-GAAP financial information to evaluate our ongoing operations and for internal planning, budgeting and forecasting purposes. We believe that this non-GAAP financial information, when taken collectively with GAAP measures, may be helpful to investors in assessing our operating performance and comparing our performance with competitors and other comparable companies, which may or may not present similar non-GAAP financial measures to investors. Our computation of these non-GAAP measures may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate these measures in the same fashion. We endeavor to compensate for the limitation of the non-GAAP measure presented by also providing the most directly comparable GAAP measure and a description of the reconciling items and adjustments to derive the non-GAAP measure. This non-GAAP measure should be considered in addition to results prepared in accordance with GAAP, but should not be considered in isolation or as a substitute for performance measures calculated in accordance with GAAP. We compensate for these limitations by relying primarily on our GAAP results and using non-GAAP measures on a supplemental basis.

Adjusted EBITDA

We believe that Adjusted EBITDA, as defined below, is useful in evaluating our operational performance distinct and apart from certain expenses that may not be indicative of our recurring core business operating results and non-operational expenses. Adjusted EBITDA is defined as Operating profit (loss) adjusted for depreciation and amortization, share-based compensation and non-recurring expenses related to the Business Combination and prior and subsequent capital raises. Adjusted EBITDA Margin is defined as Adjusted EBITDA divided by Total revenues.

Reconciliation of Operating Profit (Loss) to Adjusted EBITDA

(In thousands)







For the years ended December 31,





2022



2023

Operating profit (loss)



$

(12,577)



$

(15,462)

Depreciation and amortization (1)





5,078





4,114

Share-based compensation (2)





1,599





11,295

Transaction fees (3)





357





1,702

Adjusted EBITDA



$

(5,543)



$

1,649















Adjusted EBITDA Margin





(2.0) %





0.5 %



(1) Non-cash expenses related to depreciation and amortization

(2) Non-cash expense related to compensation costs for equity classified awards (both for the

subsidiary and the Group)

(3) Includes non-recurring transaction related fees and expenses associated with the Company's

Business Combination and prior and subsequent capital raises

 

Cision View original content:https://www.prnewswire.com/news-releases/suncar-technology-reports-29-revenue-growth-including-79-increase-in-auto-e-insurance-business-in-fy-2023-302129856.html

SOURCE SunCar Technology Group Inc.

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