GlobeNewswire Inc | Apr 30, 2021 06:19PM EDT

April 30, 2021

HANGZHOU, China, April 30, 2021 (GLOBE NEWSWIRE) -- Ebang International Holdings Inc. (Nasdaq: EBON, the Company, we or our), a blockchain technology company in the global market, today announced its financial results for the fiscal year ended December 31, 2020.

Operational and Financial Highlights for Fiscal Year 2020

Total computing power sold in fiscal year 2020 was 0.50 million TH/s, representing a year-over-year decrease of 91.64% from 5.97 million TH/s in fiscal year 2019.

Total net revenues in fiscal year 2020 were US$19.00 million representing an 82.57% year-over-year decrease from US$109.06 million in fiscal year 2019.

Gross loss in fiscal year 2020 was US$2.90 million representing a 90.51% year-over-year decrease from US$30.56 million in fiscal year 2019.

Net loss in fiscal year 2020 was US$32.11 million compared to US$41.07 million in fiscal year 2019.

Mr. Dong Hu, Chairman and Chief Executive Officer of the Company, commented, The negative impact and unprecedented challenges caused by COVID-19 on businesses around the world is well documented, and we are not immune to them. Our chip suppliers have reduced their production capacity, resulting in our shortage of raw materials during the fiscal year of 2020. To ensure the resilience of our business operations and deliver solid performance after the market condition resumes normal, we have been actively optimizing our revenue structure based on the productivity ratio and strategically exploring expansion into blockchain-enabled financial services. For example, we positioned our overseas expansion by establishing subsidiaries globally and acquiring relevant licenses or authorizations for our cryptocurrency exchange business.

Continued Hu, We are committed to our mission in strengthening the technological innovation in our products and services to ensure their competitiveness in the global cryptocurrency market. As previously noted, in 2021, we will increase investments in high performance ASIC chips and mining machines. Our abundant cash reserve allows us to expand the revenue sources from our current business and optimize the development of our blockchain industry chain. We believe our current businesses have solid potential and we are working hard to deliver results going forward that will demonstrate sequential improvement in operating and financial metrics.

Financial Results for Fiscal Year 2020

Total net revenues in fiscal year 2020 were US$19.00 million representing an 82.57% year-over-year decrease from US$109.06 million in fiscal year 2019. The year-over-year decrease in total net revenues was primarily due to the combined impact of COVID-19 such as travel restrictions, mandatory quarantines and suspension of business activities, which have caused severe disruptions and uncertainties to the Companys business operations and adversely affected the Companys results of operations and financial condition. For instance, the Companys chip suppliers have reduced their production capacity due to the impact of the COVID-19, resulting in the Companys shortage of raw materials during the first half of 2020. And together with the Bitcoin halving event, which significantly affected the expected returns on Bitcoin related activities such as mining, and in turn resulted in a much lower demand and average selling price of the Companys Bitcoin mining machines.

Cost of revenues in fiscal year 2020 was US$21.90 million compared to US$139.62 million in fiscal year 2019. The year-over-year decrease in cost of revenues was in line with the changes in the Companys sales and the decrease in inventory write-down.

Gross loss in fiscal year 2020 were US$2.90 million representing a 90.51% year-over-year decrease from US$30.56 million in fiscal year 2019.

Total operating expenses in fiscal year 2020 were US$23.75 million compared to US$20.08 million in fiscal year 2019.

-- Selling expenses in fiscal year 2020 were US$0.93 million compared to US$1.21 million in fiscal year 2019. The year-over-year decrease in selling expenses was in line with the decrease in the Companys sales as well as reduced salary and bonus expenses relating to selling activities. -- General and administrative expenses in fiscal year 2020 were US$22.82 million compared to US$18.87 million in fiscal year 2019. The year-over-year increase in general and administrative expenses was primarily due to increase in professional fee related to the IPO process.

Loss from operations in fiscal year 2020 was US$26.65 million compared to US$50.65 million in fiscal year 2019.

Interest incomein fiscal year 2020 was US$0.82 million compared to US$0.22 million in fiscal year 2019. The year-over-year increase in interest income was primarily due to the increase in the interest income from our investments in bonds after our IPO in 2020 and there was no bond investment in 2019.

Government grantsin fiscal year 2020 were US$4.01 million compared to US$6.30 million in fiscal year 2019. The year-over-year decrease in government grants was primarily due to the decrease of non-recurring rebates from local government.

Net loss in fiscal year 2020 was US$32.11 million compared to US$41.07 million in fiscal year 2019.

Net loss attributable to Ebang International Holdings Inc. in fiscal year 2020 was US$30.67 million compared to US$42.40 million in fiscal year 2019.

Basic and diluted net loss per shares in fiscal year 2020 were both US$0.25 compared to US$0.38 in fiscal year 2019.

Cash and cash equivalents were US$13.67 million as of December 31, 2020, compared with US$3.46 million as of December 31, 2019.

About Ebang International Holdings Inc.

Ebang International Holdings Inc. is a blockchain technology company with strong application-specific integrated circuit (ASIC) chip design capability. With years of industry experience and expertise in ASIC chip design, it has become a leading bitcoin mining machine producer in the global market with steady access to wafer foundry capacity. With its licensed or registered entities in various jurisdictions, the Company seeks to launch a professional, convenient and innovative digital asset financial service platform to expand into the upstream and the downstream of blockchain and cryptocurrency industry value chain. For more information, please visit https://ir.ebang.com.cn/.

Safe Harbor Statement

This press release contains forward-looking statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements include, without limitation, the Companys development plans and business outlook, which can be identified by terminology such as may, will, expects, anticipates, aims, potential, future, intends, plans, believes, estimates, continue, likely to and other similar expressions. Such statements are not historical facts, and are based upon the Companys current beliefs, plans and expectations, and the current market and operating conditions. Forward-looking statements involve inherent known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond the Companys control, which may cause the Companys actual results, performance and achievements to differ materially from those contained in any forward-looking statement. Further information regarding these and other risks, uncertainties or factors is included in the Company's filings with the U.S. Securities and Exchange Commission. These forward-looking statements are made only as of the date indicated, and the Company undertakes no obligation to update or revise the information contained in any forward-looking statements as a result of new information, future events or otherwise, except as required under applicable law.

Investor Relations Contact

For investor and media inquiries, please contact:

Ebang International Holdings Inc.Email: ir@ebang.com.cn

Ascent Investor Relations LLCMs. Tina XiaoTel: (917) 609-0333Email: tina.xiao@ascent-ir.com

EBANG INTERNATIONAL HOLDINGS INC.CONSOLIDATED BALANCE SHEETS (Stated in US dollars)

December31, December31, 2020 2019ASSETS Current assets: Cash and cash equivalents $ 13,669,439 $ 3,464,262 Restricted cash, current 406,857 2,270,588 Debt investments 40,835,000 - Accounts receivable, net 7,205,113 8,128,178 Notes receivable 765,967 - Advances to suppliers 221,186 1,062,049 Inventories, net 3,845,091 13,088,542 Prepayments 522,808 591,031 Other current assets, net 1,128,599 224,452 Total current assets 68,600,060 28,829,102 Non-current assets: Property, plant and equipment, net 29,123,243 13,224,761 Intangible assets, net 23,077,435 3,784,153 Operating lease right-of-use assets 898,335 1,280,076 Operating lease right-of-use assets - related 17,701 37,266 partyRestricted cash, non-current 47,455 43,317 Deferred tax assets - 8,542,715 VAT recoverable 21,897,063 21,954,169 Other assets 538,934 4,915,487 Total non-current assets 75,600,166 53,781,944 Total assets $ 144,200,226 $ 82,611,046 LIABILITIES AND EQUITY Current liabilities: Accounts payable $ 2,762,187 $ 11,832,003 Notes payable 1,087,673 - Accrued liabilities and other payables 21,921,614 13,739,041 Loans due within one year, less unamortized 765,967 4,864,697 debt issuance costsOperating lease liabilities, current 659,807 793,521 Operating lease liabilities ? related party, 17,701 37,266 currentIncome taxes payable 556,137 521,648 Due to related party 5,652,833 6,242,824 Advances from customers 832,842 1,015,675 Total current liabilities 34,256,761 39,046,675 Non-current liabilities: Long-term loans ? related party - 17,632,000 Deferred tax liabilities 872 - Operating lease liabilities, non-current 118,827 361,747 Total non-current liabilities 119,699 17,993,747 Total liabilities 34,376,460 57,040,422 Equity: Ordinary share, HKD0.001 par value,380,000,000 shares authorized, niland 111,771,000 shares issued and outstanding - 14,330 at December 31, 2020 and2019, respectivelyClass A ordinary share, HKD0.001 par value,333,374,217 sharesauthorized, 89,009,554 and nil shares issued 11,411 - and outstanding as ofDecember 31, 2020 and 2019, respectivelyClass B ordinary share, HKD0.001 par value,46,625,783 sharesauthorized, 46,625,783 and nil shares issued 5,978 - and outstanding as ofDecember 31, 2020 and 2019, respectivelyAdditional paid-in capital 138,288,921 23,888,023 Statutory reserves 11,049,847 11,049,847 Accumulated deficit (38,581,419 ) (7,905,999 )Accumulated other comprehensive loss (7,648,332 ) (9,066,842 )Total Ebang International Holdings Inc. 103,126,406 17,979,359 shareholders? equity Non-controlling interest 6,697,360 7,591,265 Total equity 109,823,766 25,570,624 Total liabilities and equity $ 144,200,226 $ 82,611,046

EBANG INTERNATIONAL HOLDINGS INC.CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS(Stated in US dollars)

For the year For the year For the year ended ended ended December31, December31, December31, 2020 2019 2018Product revenue $ 9,677,278 $ 93,255,813 $ 310,856,407 Service revenue 9,327,023 15,804,253 8,185,386 Total revenues 19,004,301 109,060,066 319,041,793 Cost of revenues 21,903,644 139,623,799 294,596,001 Gross profit (loss) (2,899,343 ) (30,563,733 ) 24,445,792 Operating expenses: Selling expenses 925,373 1,213,294 4,095,835 General and 22,822,085 18,870,794 51,410,864 administrative expensesTotal operating 23,747,458 20,084,088 55,506,699 expenses Loss from operations (26,646,801 ) (50,647,821 ) (31,060,907 ) Other income (expenses):Interest income 824,435 217,200 453,991 Interest expenses (728,346 ) (2,041,491 ) (921,047 )Other income 81,733 84,992 1,139,514 Exchange gain (loss) (288,346 ) 5,693,798 (403,544 )Government grants 4,006,567 6,298,893 798,680 VAT refund - 9,138 27,368,030 Other expenses (108,624 ) (287,530 ) (8,289,391 )Total other income 3,787,419 9,975,000 20,146,233 Loss before income (22,859,382 ) (40,672,821 ) (10,914,674 )taxes provision Income taxes provision 9,251,542 400,311 899,586 Net Loss (32,110,924 ) (41,073,132 ) (11,814,260 )Less: net income (loss)attributable to (1,435,504 ) 1,330,237 494,234 non-controllinginterestNet loss attributableto Ebang International $ (30,675,420 ) $ (42,403,369 ) $ (12,308,494 )Holdings Inc. Comprehensive loss Net loss $ (32,110,924 ) $ (41,073,132 ) $ (11,814,260 )Other comprehensive income (loss):Foreign currency 1,960,109 (1,188,488 ) (11,363,682 )translation adjustment Total comprehensive (30,150,815 ) (42,261,620 ) (23,177,942 )lossLess: comprehensiveincome (loss) (893,905 ) 1,330,237 494,234 attributable to non-controllinginterestComprehensive lossattributable to Ebang $ (29,256,910 ) $ (43,591,857 ) $ (23,672,176 )InternationalHoldingsInc. Net loss per ordinaryshare attributable toEbang InternationalHoldingsInc.Basic $ (0.25 ) $ (0.38 ) $ (0.36 )Diluted $ (0.25 ) $ (0.38 ) $ (0.36 ) Weighted averageordinary shares outstandingBasic 121,941,226 111,771,000 33,808,506 Diluted 121,941,226 111,771,000 33,808,506