PR Newswire | Mar 11, 2021 04:30PM EST

03/11 15:30 CST

Cango Inc. Reports Fourth Quarter and Full Year 2020 Unaudited Financial Results SHANGHAI, March 11, 2021

SHANGHAI, March 11, 2021 /PRNewswire/ -- Cango Inc. (NYSE: CANG) ("Cango" or the "Company"), a leading automotive transaction service platform in China, today announced its unaudited financial results for the fourth quarter and full year of 2020.

Fourth Quarter 2020 Financial and Operational Highlights

* Total revenues were RMB1,097.4 million (US$168.2 million), a 150.2% increase from RMB438.5 million in the same period of 2019, outperforming the high end of the Company's guidance by 46.3%. The increase was mainly driven by the increased amounts of both financing transactions the Company facilitated and car trading transactions. * Car trading transactions revenues were RMB546.8 million (US$83.8 million), or 49.8% of total revenues in the fourth quarter of 2020. * Automotive financing facilitation revenues were RMB398.1 million (US$61.0 million), a 51.8% increase from RMB262.3 million in the same period of 2019. * The amount of financing transactions the Company facilitated in the fourth quarter of 2020 was RMB10,822.2 million (US$1,658.6 million). The total outstanding balance of financing transactions the Company facilitated was RMB43,504.8 million (US$6,667.4 million) as of December 31, 2020. * M1+ and M3+ overdue ratios for all financing transactions that remained outstanding and were facilitated by the Company were 0.98% and 0.42%, respectively, as of December 31, 2020, compared to 1.11% and 0.53%, respectively, as of September 30, 2020. * The number of dealers covered by the Company was 48,487 as of December 31, 2020, compared to 46,248 as of September 30, 2020. The increase was mainly due to the expansion of 4S dealers and quality dealers in the lower-tier cities following the introduction of the Company's competitive products.

Full Year 2020 Financial and Operational Highlights

* Total revenues were RMB2,052.4 million (US$314.5 million), a 42.5% increase from RMB1,440.1 million in the full year of 2019. * Car trading transactions revenues were RMB624.8 million (US$95.8 million), or 30.4% of total revenues in the full year of 2020. * Automotive financing facilitation revenues were RMB891.8 million (US$136.7 million), compared to RMB913.8 million in the full year of 2019. This slight decrease was mainly due to the impact of the Covid-19 pandemic, which severely disrupted the domestic automotive industry in the first half of 2020. * After-market services facilitation revenues were RMB241.2 million (US$37.0 million), compared to RMB206.0 million in the full year of 2019. * The amount of financing transactions the Company facilitated in the full year of 2020 was RMB27,697.7 million (US$4,244.9 million). * M1+ and M3+ overdue ratios for all financing transactions that remained outstanding and were facilitated by the Company were 0.98% and 0.42%, respectively, as of December 31, 2020, compared to 0.85% and 0.40%, respectively, as of December 31, 2019. * The number of dealers covered by the Company was 48,487 as of December 31, 2020, compared to 49,238 as of December 31, 2019.

Mr. Jiayuan Lin, Chief Executive Officer of Cango, commented, "It was a remarkable year for Cango despite the challenging environment due to the Covid-19 outbreak. Fueled by our mission to make car purchases simple and enjoyable, our ongoing efforts to build a one-stop platform that empowers all parties involved in the car transaction value chain has enabled us to navigate challenges and deliver solid results. During the fourth quarter, we achieved outstanding performance across the board including our automotive financing facilitation, car trading transactions and after-market services facilitation businesses. Fourth quarter total revenues came in at RMB1,097.4 million, exceeding the high end of our previous guidance by 46.3%. Robust returns from our investment in Li Auto are already contributing to strong growth in our bottom line, and our deep insights into sector trends make us optimistic about the automotive industry's gradual but pervasive evolution toward new energy vehicles.

"The success we achieved in 2020 stems from our industry know-how and the strong platform we have worked so hard to build over the past decade. Benefitting from our strong foothold in the lower-tier markets, we have seen great synergies across our businesses. In particular, revenues from our car trading transactions business contributed approximately 50% of total revenues in the fourth quarter, becoming an important growth driver for us. With our platform, we aim to connect all participants in the automotive transaction value chain through our closed-loop services with customer experience at the core. During the fourth quarter, we also made significant strides to enhance our service capabilities in terms of traffic generation and operation, supply chain management, as well as technological capabilities.

"Looking back over the last 10 years since Cango was founded, we have grown our business with a passion, always looking toward the future and staying true to our original aspirations even as we weathered obstacles. Moving into the next decade, we believe our vast dealership network, efficient service platform, competitive technological advantages and industry expertise give us a unique edge which will not only benefit our customers by giving them a premium experience and enhanced, comprehensive offerings, but also help accelerate growth of the auto market in China."

Mr. Yongyi Zhang, Chief Financial Officer of Cango, stated, "Our continuous and steady progress across businesses fueled our top line expansion in the fourth quarter. Total revenues grew to a record level of RMB1.1 billion, up 150.2% year-over-year. As we rolled out more initiatives to effectively optimize overall cost, our operating income maintained its robust growth momentum in the quarter, rising 68.6% year-over-year. With robust returns from our investment in Li Auto, we also expanded our profitability in the fourth quarter, growing net income by over 15 times to RMB1.6 billion. Looking ahead, we remain focused on executing our growth strategy and committed to investing selectively in growth opportunities across all our business lines."

Fourth Quarter 2020 Financial Results

REVENUES

Total revenues in the fourth quarter of 2020 increased by 150.2% to RMB1,097.4 million (US$168.2 million) from RMB438.5 million in the same period of 2019. Revenues from car trading transactions in the fourth quarter of 2020 were RMB546.8 million (US$83.8 million), becoming an important revenue contributor. Revenues from automotive financing facilitation and after-market services facilitation in the fourth quarter of 2020 were RMB398.1 million (US$61.0 million) and RMB70.8 million (US$10.8 million), respectively.

OPERATING COST AND EXPENSES

Total operating cost and expenses in the fourth quarter of 2020 were RMB899.0 million (US$137.8 million) compared to RMB320.8 million in the same period of 2019. This was mainly due to the related costs incurred by car trading transactions business. Primarily as a result of the increase in revenues from car trading transactions, sales and marketing expenses, general and administrative expenses and research and development expenses each decreased as a percentage of total revenues in the fourth quarter of 2020, compared to the same period of 2019.

* Cost of revenue in the fourth quarter of 2020 increased to RMB723.8 million (US$110.9 million) from RMB157.2 million in the same period of 2019. As a percentage of total revenues, cost of revenue in the fourth quarter of 2020 was 66.0% compared to 35.9% in the same period of 2019, and the change was primarily due to an increase in the amount of car trading transactions. For automotive financing facilitation and after-market services facilitation, cost of revenue as a percentage of relevant revenues was around 30% in the fourth quarter of 2020. * Sales and marketing expenses in the fourth quarter of 2020 were RMB65.8 million (US$10.1 million) compared to RMB55.2 million in the same period of 2019. As a percentage of total revenues, sales and marketing expenses in the fourth quarter of 2020 was 6.0% compared to 12.6% in the same period of 2019. * General and administrative expenses in the fourth quarter of 2020 were RMB90.1 million (US$13.8 million) compared to RMB66.1 million in the same period of 2019. As a percentage of total revenues, general and administrative expenses in the fourth quarter of 2020 was 8.2% compared to 15.1% in the same period of 2019. * Research and development expenses in the fourth quarter of 2020 were RMB23.0 million (US$3.5 million) compared to RMB18.6 million in the same period of 2019. As a percentage of total revenues, research and development expenses in the fourth quarter of 2020 was 2.1% compared to 4.2% in the same period of 2019. * Net gain on risk assurance liabilities in the fourth quarter of 2020 was RMB18.8 million (US$2.9 million) compared to a net loss of RMB6.5 million in the same period of 2019. Net gain on risk assurance liabilities was mainly due to a sequential decrease in default rate since the third quarter of 2020.

INCOME FROM OPERATIONS

Income from operations in the fourth quarter of 2020 was RMB198.4 million (US$30.4 million), compared toRMB117.7 million in the same period of 2019.

FAIR VALUE CHANGE OF EQUITY INVESTMENT

Fair value change of equity investment in the fourth quarter of 2020 was a gain of RMB1,487.8 million (US$228.0 million) compared to nil in the same period of 2019. The Company's investee, Li Auto Inc. ("Li Auto"), has been listed on the Nasdaq Global Select Market sinceJuly 30, 2020. As of December 31, 2020, Cango held 39,194,413 Class A ordinary shares of Li Auto.

NET INCOME

Net income in the fourth quarter of 2020 was RMB1,568.5 million (US$240.4 million), an increase of 1,432.1% from RMB102.4 million in the same period of 2019. Non-GAAP adjusted net income in the fourth quarter of 2020 was RMB1,588.0 million (US$243.4 million), an increase of 1,189.2% from RMB123.2 million in the same period of 2019. Non-GAAP adjusted net income excludes the impact of share-based compensation expenses. For further information, see "Use of Non-GAAP Financial Measure."

NET INCOME PER ADS

Basic and diluted net income per American Depositary Share (ADS) in the fourth quarter of 2020 were RMB10.48(US$1.61) and RMB10.40(US$1.59), respectively. Non-GAAP adjusted basic and diluted net income per ADS in the fourth quarter of 2020 were RMB10.61(US$1.63) and RMB10.53(US$1.61), respectively. Each ADS represents two Class A ordinary shares of the Company.

BALANCE SHEET

As of December 31, 2020, the Company had cash and cash equivalents of RMB1,426.9 million (US$218.7 million), compared to RMB1,423.3 million as of September 30, 2020.

As of December 31, 2020, the Company had short-term investments of RMB4,342.4 million (US$665.5 million), compared to RMB1,140.2 million as of September 30, 2020. The increase was mainly due to the change in fair value of the Company's investment in Li Auto and the Company's reclassification of such investment from long-term investments to short-term investments.

Full Year 2020 Financial Results

REVENUES

Total revenues in the full year of 2020 increased by 42.5% to RMB2,052.4 million (US$314.5 million) from RMB1,440.1 million in the full year of 2019. Revenues from car trading transactions in the full year of 2020 were RMB624.8 million (US$95.8 million). Revenues from automotive financing facilitation and after-market services facilitation in the full year of 2020 were RMB891.8 million (US$136.7 million) and RMB241.2 million (US$37.0 million), respectively.

OPERATING COST AND EXPENSES

Total operating cost and expenses in the full year of 2020 were RMB1,734.1 million (US$265.8 million) compared to RMB1,116.8 million in the full year of 2019. This was mainly due to the related costs incurred by car trading transactions business. Primarily as a result of the increase in revenues from car trading transactions, sales and marketing expenses, general and administrative expenses and research and development expenses each decreased as a percentage of total revenues in the full year of 2020, compared to the full year of 2019.

* Cost of revenue in the full year of 2020 increased to RMB1,098.1 million (US$168.3 million) from RMB539.3 million in the full year of 2019. As a percentage of total revenues, cost of revenue in the full year of 2020 was 53.5% compared to 37.4% in the full year of 2019, and the change was primarily due to an increase in the amount of car trading transactions. For automotive financing facilitation and after-market services facilitation, cost of revenue as a percentage of relevant revenues was around 30% in the full year of 2020. * Sales and marketing expenses in the full year of 2020 were RMB195.9 million (US$30.0 million) compared to RMB192.8 million in the full year of 2019. As a percentage of total revenues, sales and marketing expenses in the full year of 2020 was 9.5% compared to 13.4% in the full year of 2019. * General and administrative expenses in the full year of 2020 were RMB265.7 million (US$40.7 million) compared to RMB236.6 million in the full year of 2019. As a percentage of total revenues, general and administrative expenses in the full year of 2020 was 12.9% compared to 16.4% in the full year of 2019. * Research and development expenses in the full year of 2020 were RMB62.6 million (US$9.6 million) compared to RMB57.4 million in the full year of 2019. As a percentage of total revenues, research and development expenses in the full year of 2020 was 3.0% compared to 4.0% in the full year of 2019. * Net loss on risk assurance liabilities in the full year of 2020 was RMB2.3 million (US$0.3 million) compared to a net loss of RMB34.3 million in the same period of 2019.

INCOME FROM OPERATIONS

Income from operations in the full year of 2020 was RMB318.3 million (US$48.8 million), compared toRMB323.3 million in the full year of 2019. This slight decrease was mainly due to the impact of the Covid-19 pandemic, which severely disrupted the domestic automotive industry in the first half of 2020.

FAIR VALUE CHANGE OF EQUITY INVESTMENT

Fair value change of equity investment in the full year of 2020 was a gain of RMB3,315.5 million (US$508.1 million) compared to a gain ofRMB41.6 million in the full year of 2019. The Company's investee, Li Auto Inc. ("Li Auto"), has been listed on the Nasdaq Global Select Market sinceJuly 30, 2020. As of December 31, 2020, Cango held 39,194,413 Class A ordinary shares of Li Auto.

NET INCOME

Net income in the full year of 2020 was RMB3,373.4 million (US$517.0 million), an increase of 733.2% from RMB404.9 million in the full year of 2019. Non-GAAP adjusted net income in the full year of 2020 was RMB3,452.2 million (US$529.1 million), an increase of 608.7% from RMB487.1 million in the full year of 2019. Non-GAAP adjusted net income excludes the impact of share-based compensation expenses. For further information, see "Use of Non-GAAP Financial Measure."

NET INCOME PER ADS

Basic and diluted net income per ADS in the full year of 2020 were RMB22.43(US$3.44) and RMB22.17(US$3.40), respectively. Non-GAAP adjusted basic and diluted net income per ADS in the full year of 2020 were RMB22.95(US$3.52) and RMB22.69(US$3.48), respectively. Each ADS represents two Class A ordinary shares of the Company.

Business Outlook

For the first quarter of 2021, the Company expects total revenues to be between RMB1,000 million and RMB1,050 million. This forecast reflects the Company's current and preliminary views on the market and operational conditions, which are subject to change.

The Company's investment in Li Auto and the change in fair value of investment due to the price volatility of the stock may have a significant impact on the Company's first quarter of 2021 financial results.

Conference Call Information

The Company's management will hold a conference call on Thursday, March 11, 2021, at 8:00 P.M. Eastern Time or Friday, March 12, 2020, at 9:00 A.M. Beijing Time to discuss the financial results. Listeners may access the call by dialing the following numbers:

International: +1-412-902-4272

United States Toll Free: +1-888-346-8982

Mainland China Toll Free: 4001-201-203

Hong Kong, China Toll Free: 800-905-945

Conference ID: Cango Inc.

The replay will be accessible through March 18, 2021, by dialing the following numbers:

International: +1-412-317-0088

United States Toll Free: +1-877-344-7529

Access Code: 10153000

A live and archived webcast of the conference call will also be available at the Company's investor relations website at http://ir.cangoonline.com/.

About Cango Inc.

Cango Inc. (NYSE: CANG) is a leading automotive transaction service platform in China connecting dealers, financial institutions, car buyers, and other industry participants. Founded in 2010 by a group of pioneers in China's automotive finance industry, the Company is headquartered in Shanghai and engages car buyers through a nationwide dealer network. The Company's services primarily consist of automotive financing facilitation, car trading transactions, and after-market services facilitation. By utilizing its competitive advantages in technology, data insights, and cloud-based infrastructure, Cango is able to connect its platform participants while bringing them a premium user experience. Cango's platform model puts it in a unique position to add value for its platform participants and business partners as the automotive and mobility markets in China continue to grow and evolve. For more information, please visit: www.cangoonline.com

Definition of Overdue Ratios

The Company defines "M1+ overdue ratio" as (i) exposure at risk relating to financing transactions for which any installment payment is 30 to 179 calendar days past due as of a specified date, divided by (ii) exposure at risk relating to all financing transactions which remain outstanding as of such date, excluding amounts of outstanding principal that are 180 calendar days or more past due.

The Company defines "M3+ overdue ratio" as (i) exposure at risk relating to financing transactions for which any installment payment is 90 to 179 calendar days past due as of a specified date, divided by (ii) exposure at risk relating to all financing transactions which remain outstanding as of such date, excluding amounts of outstanding principal that are 180 calendar days or more past due.

Use of Non-GAAP Financial Measure

In evaluating the business, the Company considers and uses Non-GAAP adjusted net income, a non-GAAP measure, as a supplemental measure to review and assess its operating performance. The presentation of the non-GAAP financial measure is not intended to be considered in isolation or as a substitute for the financial information prepared and presented in accordance with U.S. GAAP. The Company defines Non-GAAP adjusted net income as net income excluding share-based compensation expenses. The Company presents the non-GAAP financial measure because it is used by the management to evaluate the operating performance and formulate business plans. Non-GAAP adjusted net income enables the management to assess the Company's operating results without considering the impact of share-based compensation expenses, which are non-cash charges. The Company also believes that the use of the non-GAAP measure facilitates investors' assessment of its operating performance.

Non-GAAP adjusted net income is not defined under U.S. GAAP and is not presented in accordance with U.S. GAAP. This non-GAAP financial measure has limitations as analytical tools. One of the key limitations of using Non-GAAP adjusted net income is that it does not reflect all items of expense that affect the Company's operations. Share-based compensation expenses have been and may continue to be incurred in the business and are not reflected in the presentation of Non-GAAP adjusted net income. Further, the non-GAAP measure may differ from the non-GAAP information used by other companies, including peer companies, and therefore their comparability may be limited.

The Company compensates for these limitations by reconciling the non-GAAP financial measure to the nearest U.S. GAAP performance measure, all of which should be considered when evaluating the Company's performance. The Company encourages you to review its financial information in its entirety and not rely on a single financial measure.

Reconciliations of Cango's non-GAAP financial measure to the most comparable U.S. GAAP measure are included at the end of this press release.

Exchange Rate Information

This announcement contains translations of certain RMB amounts into U.S. dollars ("US$") at specified rates solely for the convenience of the reader. Unless otherwise stated, all translations from RMB to US$ were made at the rate of RMB6.5250 to US$1.00, the noon buying rate in effect on December 31, 2020, in the H.10 statistical release of the Federal Reserve Board. The Company makes no representation that the RMB or US$ amounts referred could be converted into US$ or RMB, as the case may be, at any particular rate or at all.

Safe Harbor Statement

This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates" and similar statements. Among other things, the "Business Outlook" section and quotations from management in this announcement, contain forward-looking statements. Cango may also make written or oral forward-looking statements in its periodic reports to the SEC, in its annual report to shareholders, in press releases and other written materials and in oral statements made by its officers, directors or employees to third parties. Statements that are not historical facts, including statements about Cango's beliefs and expectations, are forward-looking statements. Forward-looking statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statement, including but not limited to the following: Cango's goal and strategies; Cango's expansion plans; Cango's future business development, financial condition and results of operations; Cango's expectations regarding demand for, and market acceptance of, its solutions and services; Cango's expectations regarding keeping and strengthening its relationships with dealers, financial institutions, car buyers and other platform participants; general economic and business conditions; and assumptions underlying or related to any of the foregoing. Further information regarding these and other risks is included in Cango's filings with the SEC. All information provided in this press release and in the attachments is as of the date of this press release, and Cango does not undertake any obligation to update any forward-looking statement, except as required under applicable law.

Investor Relations Contact

Caesar CaoCango Inc.Tel: +86 21 3183 5088 ext.5581Email: ir@cangoonline.com

Emilie WuThe Piacente Group, Inc.Tel: +86 21 6039 8363Email: ir@cangoonline.com

CANGO INC.UNAUDITED INTERIM CONDENSED CONSOLIDATED BALANCE SHEET(Amounts in Renminbi ("RMB") and US dollar ("US$"), except for number of sharesand per share data?

As of December 31, As of December 31, 2019 2020

RMB RMB US$

ASSETS:

Current assets:

Cash and cash equivalents 2,002,314,688 1,426,899,576 218,681,927

Restricted cash - current 970,993,759 9,693,008 1,485,518

Short-term investments 597,265,740 4,342,356,612 665,495,266

Accounts receivable, net 148,562,946 141,594,170 21,700,256

Finance lease receivables - current, net 1,661,082,122 2,035,397,525 311,938,318

Short-term consumer financing receivables, net 13,298,562 23,168 3,551

Financing receivables, net 9,103,522 20,105,893 3,081,363

Short-term contract asset 20,688,424 364,618,635 55,880,251

Prepayments and other current assets 117,445,282 558,360,959 85,572,561

Total current assets 5,540,755,045 8,899,049,546 1,363,839,011

Non-current assets:

Restricted cash - non-current 873,674,276 878,299,140 134,605,232

Long-term investments 547,888,818 - -

Goodwill 145,063,857 145,063,857 22,232,009

Property and equipment, net 14,736,767 10,311,971 1,580,379

Intangible assets 44,758,242 44,887,871 6,879,367

Long-term contract asset 11,655,356 281,374,110 43,122,469

Deferred tax assets 100,667,946 170,951,082 26,199,400

Finance lease receivables - non-current, net 1,448,958,373 1,454,499,864 222,911,857

Other non-current assets 8,415,694 261,495,158 40,075,886

Total non-current assets 3,195,819,329 3,246,883,053 497,606,599

TOTAL ASSETS 8,736,574,374 12,145,932,599 1,861,445,610

LIABILITIES AND SHAREHOLDERS' EQUITY

Current liabilities:

Short-term debts 1,439,749,760 355,816,940 54,531,332

Long-term debts-current 863,418,789 1,228,783,730 188,319,346

Accrued expenses and other current liabilities 278,690,234 324,734,202 49,767,695

Risk assurance liabilities 259,952,473 460,829,299 70,625,180

Income tax payable 67,308,814 87,132,455 13,353,633

Total current liabilities 2,909,120,070 2,457,296,626 376,597,186

Non-current liabilities:

Long-term debts 301,667,717 977,791,191 149,853,056

Deferred tax liability 12,329,929 330,765,029 50,691,958

Other non-current liabilities 21,796,367 4,870,616 746,455

Total non-current liabilities 335,794,013 1,313,426,836 201,291,469

Total liabilities 3,244,914,083 3,770,723,462 577,888,655

Shareholders' equity

Ordinary shares 204,260 204,260 31,304

Treasury shares (20,638,881) (56,419,225) (8,646,625)

Additional paid-in capital 4,526,344,454 4,591,455,557 703,671,350

Accumulated other comprehensive income 119,430,738 (115,386,427) (17,683,744)

Retained earnings 852,508,968 3,955,354,972 606,184,670

Total Cango Inc.'s equity 5,477,849,539 8,375,209,137 1,283,556,955

Non-controlling interests 13,810,752 - -

Total shareholders' equity 5,491,660,291 8,375,209,137 1,283,556,955

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY 8,736,574,374 12,145,932,599 1,861,445,610

CANGO INC.UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OFCOMPREHENSIVE INCOME(Amounts in Renminbi ("RMB") and US dollar ("US$"), except for number of sharesand per share data)

For the three months ended For the years ended

December 31, 2019 December 31, 2020 December 31, 2019 December 31, 2020

RMB RMB US$ RMB RMB US$

Revenues 438,533,179 1,097,429,135 168,188,373 1,440,068,825 2,052,431,752 314,548,928

Loan facilitation income and other related income 262,295,288 398,055,300 61,004,644 913,836,623 891,836,601 136,679,939

Leasing income 82,418,353 79,117,567 12,125,298 300,078,043 286,079,245 43,843,562

After-market services income 89,629,125 70,763,076 10,844,916 205,998,075 241,193,243 36,964,482

Automobile trading income 2,166,064 546,810,484 83,802,373 11,414,382 624,773,721 95,750,762

Others 2,024,349 2,682,708 411,142 8,741,702 8,548,942 1,310,183

Operating cost and expenses:

Cost of revenue 157,220,585 723,834,701 110,932,521 539,267,417 1,098,120,749 168,294,368

Sales and marketing 55,183,623 65,828,565 10,088,669 192,811,348 195,893,662 30,022,017

General and administrative 66,050,217 90,084,628 13,806,073 236,551,077 265,691,411 40,718,990

Research and development 18,630,984 22,986,127 3,522,778 57,405,921 62,596,195 9,593,287

Net loss (gain) on risk assurance liabilities 6,537,857 (18,804,024) (2,881,843) 34,257,754 2,268,180 347,614

Provision for credit losses 17,205,137 15,063,030 2,308,510 56,478,959 109,564,631 16,791,514

Total operation cost and expense 320,828,403 898,993,027 137,776,708 1,116,772,476 1,734,134,828 265,767,790

Income from operations 117,704,776 198,436,108 30,411,665 323,296,349 318,296,924 48,781,138

Interest and investment Income, net 13,305,220 12,123,098 1,857,946 96,004,567 72,806,814 11,158,132

Loss from equity method investments - - - (926,205) - -

Fair value change of equity investment - 1,487,757,246 228,008,773 41,581,818 3,315,475,734 508,118,886

Interest expense (162,691) (508,084) (77,867) (13,457,818) (2,758,629) (422,778)

Foreign exchange gain (loss), net 3,053,854 (3,646,480) (558,848) 5,141,112 (8,848,354) (1,356,070)

Other income, net 2,402,484 15,333,721 2,349,996 41,300,464 49,139,337 7,530,933

Other expenses (3,635,688) (240,239) (36,818) (5,121,054) (838,115) (128,447)

Net income before income taxes 132,667,955 1,709,255,370 261,954,847 487,819,233 3,743,273,711 573,681,794

Income tax expenses (30,295,127) (140,762,635) (21,572,818) (82,960,493) (369,853,650) (56,682,552)

Net income 102,372,828 1,568,492,735 240,382,029 404,858,740 3,373,420,061 516,999,242

Less: Net income attributable to non-controlling interests 8,252,659 - - 13,944,848 3,902,214 598,040

Net income attributable to Cango Inc.'s 94,120,169 1,568,492,735 240,382,029 390,913,892 3,369,517,847 516,401,202shareholders

Earnings per ADS attributable to ordinaryshareholders:

Basic 0.62 10.48 1.61 2.59 22.43 3.44

Diluted 0.62 10.40 1.59 2.58 22.17 3.40

Weighted average ADS used to compute earningsper ADS attributable to ordinary shareholders:

Basic 150,973,390 149,696,285 149,696,285 151,208,677 150,242,378 150,242,378

Diluted 151,231,854 150,822,105 150,822,105 151,641,830 151,955,546 151,955,546

Other comprehensive (loss) income, net of tax

Unrealized losses on available-for-sale securities - - - (146,801) - -

Reclassification of losses to net income - - - (276,843) - -

Foreign currency translation adjustment (32,850,858) (152,747,428) (23,409,568) 10,401,386 (234,817,165) (35,987,305)

Total comprehensive income 69,521,970 1,415,745,307 216,972,461 414,836,482 3,138,602,896 481,011,937

Total comprehensive income attributable to Cango 61,269,311 1,415,745,307 216,972,461 400,891,634 3,134,700,682 480,413,897Inc.'s shareholders

CANGO INC.RECONCILIATIONS OF GAAP AND NON-GAAP RESULTS(Amounts in Renminbi ("RMB") and US dollar ("US$"), except for number of sharesand per share data

For the three months ended For the years ended

Decemer 31, 2019 Decemer 31, 2020 Decemer 31, 2019 Decemer 31, 2020

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)

RMB RMB US$ RMB RMB US$

Net income 102,372,828 1,568,492,735 240,382,029 404,858,740 3,373,420,061 516,999,242

Add: Share-based compensation expenses 20,805,269 19,486,068 2,986,371 82,265,990 78,754,828 12,069,705

Cost of revenue 853,017 645,296 98,896 3,372,908 3,075,317 471,313

Sales and marketing 4,431,522 3,379,241 517,891 17,522,654 16,003,486 2,452,642

General and administrative 14,438,854 14,458,117 2,215,804 57,092,589 55,590,630 8,519,636

Research and development 1,081,876 1,003,414 153,780 4,277,839 4,085,395 626,114

Non-GAAP adjusted net income 123,178,097 1,587,978,803 243,368,400 487,124,730 3,452,174,889 529,068,947

Less: Net income attributable to non-controlling interests 8,252,659 - - 13,944,848 3,902,214 598,040

Net income attributable to Cango Inc.'s shareholders 114,925,438 1,587,978,803 243,368,400 473,179,882 3,448,272,675 528,470,907

Non-GAAP adjusted net income per ADS-basic 0.76 10.61 1.63 3.13 22.95 3.52

Non-GAAP adjusted net income per ADS-diluted 0.76 10.53 1.61 3.12 22.69 3.48

Weighted average ADS outstanding-basic 150,973,390 149,696,285 149,696,285 151,208,677 150,242,378 150,242,378

Weighted average ADS outstanding-diluted 151,231,854 150,822,105 150,822,105 151,641,830 151,955,546 151,955,546

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SOURCE Cango Inc.