UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 3, 2020
IDEANOMICS, INC.
(Exact Name of Registrant as Specified in Its Charter)
| Nevada | 001-35561 | 20-1778374 |
|
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
55 Broadway, 19th Floor, New York, NY 10006
(Address of principal executive offices) (Zip Code)
212-206-1216
(Registrant’s telephone number, including area code)
(Former name or former address, if changed since last report.)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ¨
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
| Common Stock, par value $.001 | IDEX | The NASDAQ Stock Market |
Item 2.02. Results of Operations and Financial Condition.
On November 9, 2020, Ideanomics, Inc. (the “Company”) issued a press release announcing its financial results for the fiscal quarter ended September 30, 2020. A copy of the Company’s press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.
The information contained in this Item 2.02, including Exhibit 99.1, shall not be deemed filed for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference into any other filings under the Exchange Act or the Securities Act of 1933, as amended, except as shall be expressly set forth by specific reference in such a filing.
Item 3.01 Notice of Delisting or Failure to Satisfy a Continued Listing Rule or Standard; Transfer of Listing.
On November 3, 2020, Ideanomics, Inc. (the “Company”) received a letter from the Listing Qualifications Staff (the “Staff”) of The Nasdaq Stock Market LLC (“Nasdaq”) indicating that the bid price for the Company’s common stock for the last 30 consecutive business days had closed below the minimum $1.00 per share required for continued listing under Nasdaq Listing Rule 5550(a)(2).
Under Nasdaq Listing Rule 5810(c)(3)(A), the Company has been granted a 180 calendar day grace period, or until May 2, 2021, to regain compliance with the minimum bid price requirement. The continued listing standard will be met if the Company evidences a closing bid price of at least $1.00 per share for a minimum of 10 consecutive business days during the 180 calendar day grace period. In order for Nasdaq to consider granting the Company additional time beyond May 2, 2021, the Company would be required, among other things, to meet the continued listing requirement for market value of publicly held shares as well as all other standards for initial listing on Nasdaq, with the exception of the minimum bid price requirement. If measured today, the Company would qualify for Nasdaq’s consideration of an extension because the Company currently has stockholders’ equity of at least $5 million. In the event the Company does not regain compliance with the $1.00 bid price requirement by May 2, 2021, eligibility for Nasdaq’s consideration of a second 180 day grace period would be determined on the Company’s compliance with the above referenced criteria on May 2, 2021.
The Company is diligently working to evidence compliance with the minimum bid price requirement for continued listing on Nasdaq; however, there can be no assurance that the Company will be able to regain compliance or that Nasdaq will grant the Company a further extension of time to regain compliance, if necessary. If the Company fails to regain compliance with the Nasdaq continued listing standards, its common stock will be subject to delisting from Nasdaq.
Item 9.01. Financial Statements and Exhibits.
| (d) | Exhibits |
| Exhibit No. | Description |
| 99.1 | Press Release dated November 9, 2020. |
This Current Report on Form 8-K contains “forward-looking” statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, including statements related to the Company’s ability to regain compliance with Nasdaq’s continued listing standards and the Company’s eligibility for an additional grace period beyond June 29, 2020. The words “may,” “will,” “could,” “would,” “should,” “expect,” “intend,” “plan,” “anticipate,” “believe,” “estimate,” “predict,” “project,” “potential,” “continue,” “ongoing” and similar expressions are intended to identify forward-looking statements, although not all forward-looking statements contain these identifying words. While the Company believes its plans, intentions and expectations reflected in those forward-looking statements are reasonable, these plans, intentions or expectations may not be achieved. The Company’s actual results, performance or achievements could differ materially from those contemplated, expressed or implied by the forward-looking statements. For information about the factors that could cause such differences, please refer to the Company’s Annual Report on Form 10-K for the year ended December 31, 2018, including the information discussed under the captions “Item 1 Business,” “Item 1A. Risk Factors” and “Item 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations,” as well as the Company’s various other filings with the SEC. Given these uncertainties, you should not place undue reliance on these forward-looking statements. The Company assumes no obligation to update any forward-looking statement.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Ideanomics, Inc. | |||
| Date: November 9, 2020 | By: | /s/ Alfred Poor | |
| Alfred Poor | |||
| Chief Executive Officer | |||
Exhibit 99.1
Ideanomics, Inc. Reports Q3 2020 Financial Results
| - | Revenues for the three months ended September 30, 2020, was $10.6 million, an increase of 2.3x compared to Q2 2020 and 3.4x compared to Q3 2019 |
| - | Strong cash position, finished the quarter with $27.6 million |
| - | Q3 revenues were supported by strong growth in the Taxi and Ridesharing segment |
| - | Strategic Investment into California e-tractor company, Solectrac, which services agricultural and specialty vehicle market |
New York, NY November 9, 2020/PRNewswire/ -- Ideanomics (NASDAQ: IDEX) ("Ideanomics" or the "Company"), a global company focused on monetizing the adoption of commercial electric vehicles and associated energy consumption, as well as enabling the next generation of financial services and fintech products, announced today its third quarter 2020 operating results for the period ended September 30, 2020 (a full copy of the Company's 10-Q report is available at www.sec.gov).
Conference Call: Ideanomics' management, including Alf Poor (Chief Executive Officer), Conor McCarthy (Chief Financial Officer) and Tony Sklar (SVP of Investor Relations), will host live an earnings release conference call at 4:30 pm ET, Monday, November 9, 2020. http://investors.ideanomics.com. Time permitting, Ideanomics management will answer questions during the live Q&A session. A replay of the earnings call will be available soon after the conclusion of the event.
To join the webcast, please visit the 'Events & Presentations' section of the Ideanomics corporate website (http://www.ideanomics.com/), or copy/paste this link:
https://78449.themediaframe.com/dataconf/productusers/ssc/mediaframe/41438/indexl.html
“We reported our third consecutive quarter of MEG revenue growth, and our pipeline gives us confidence that we can maintain this momentum through our product and service offerings and global footprint,” said Alf Poor, CEO of Ideanomics. “The MEG division in China, Treeletrik in Malaysia, and Medici Motor Works and Solectrac in the U.S. are all progressing towards our objectives for the remainder of 2020, and into 2021 and beyond. Strong growth in our taxi and ridesharing business is continuing and we are beginning to bring other revenues online in Q4, including activity in the bus segment of our business.”
Ideanomics Third Quarter 2020 Operating Results
Revenue for the three months ended September 30, 2020, was $10.6 million, of which $10.1 million were generated by the Company’s MEG business unit; this represents the largest revenues earned by MEG since the Company commenced business.
In the third quarter of 2020, the Company continued to develop its MEG business and recognized $10.6 million revenue from the sales of vehicles, which included revenue of $1.3 million from the sale of traditional combustion engine vehicles. In the third quarter of 2020 the Company acted in both a Principal and Agent capacity in relation to vehicle sales. For those contracts in which it acted in a Principal capacity revenues were recorded on a Gross basis and for those contracts where it acted in an Agent capacity the revenues were recorded on a Net basis.
Gross Profit
Gross profit for the three months ended September 30, 2020 was $0.7 million, as compared to gross profit in the amount of $2.9 million during the same period in 2019.
Operating Loss
The Loss from Operations was $12.0 million as compared to $9.4 million in the prior period. The increased Operating Loss is almost entirely due to the lower gross profit in the current quarter.
About Ideanomics
Ideanomics is a global company that facilitates the adoption of commercial electric vehicles and supports next-generation financial services and fintech products. Our electric vehicle division, Mobile Energy Global (MEG) provides group purchasing discounts on commercial electric vehicles, EV batteries and electricity, as well as financing and charging solutions; we refer to this business model as sales to financing to charging (S2F2C). Ideanomics Capital provides intelligent and innovative services for the fintech industry. Together, MEG and Ideanomics Capital provide our global customers and partners with more efficient solutions.
The company is headquartered in New York, NY, with offices in Beijing, Hangzhou, and Qingdao, and operations in the U.S., China, Ukraine, and Malaysia.
Safe Harbor Statement
This press release contains certain statements that may include "forward looking statements". All statements other than statements of historical fact included herein are "forward-looking statements." These forward-looking statements are often identified by the use of forward-looking terminology such as "believes," "expects" or similar expressions, involve known and unknown risks and uncertainties, and include statements regarding our intention to transition our business model to become a next-generation financial technology company, our business strategy and planned product offerings, our intention to phase out our oil trading and consumer electronics businesses, and potential future financial results. Although the Company believes that the expectations reflected in such forward-looking statements are reasonable, they do involve assumptions, risks and uncertainties, and these expectations may prove to be incorrect. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company's actual results could differ materially from those anticipated in these forward-looking statements as a result of a variety of risks and uncertainties, such as risks related to: our ability to continue as a going concern; our ability to raise additional financing to meet our business requirements; the transformation of our business model; fluctuations in our operating results; strain to our personnel management, financial systems and other resources as we grow our business; our ability to attract and retain key employees and senior management; competitive pressure; our international operations; and other risks and uncertainties disclosed under the sections entitled "Risk Factors" and "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission, and similar disclosures in subsequent reports filed with the SEC, which are available on the SEC website at www.sec.gov.. All forward-looking statements attributable to the Company or persons acting on its behalf are expressly qualified in their entirety by these risk factors. Other than as required under the securities laws, the Company does not assume a duty to update these forward-looking statements.
Investor Relations and Media Contact
Tony Sklar, VP of Communications
1441 Broadway, Suite 5116, New York, NY 10018
ir@ideanomics.com
Valerie Christopherson / Lora Wilson
Global Results Communications (GRC)
+1 949 306 6476
valeriec@globalresultspr.com
IDEANOMICS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (Unaudited) (USD in thousands)
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.
IDEANOMICS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (Unaudited) (USD in thousands, except per share amounts)
| Three Months Ended | Nine Months Ended | ||||||||||||
| September 30, 2020 | September 30, 2019 | September 30, 2020 | September 30, 2019 | ||||||||||
| Revenue from third-parties | $ | 10,618 | $ | 250 | $ | 15,681 | $ | 950 | |||||
| Revenue from related parties | 2 | 2,854 | 9 | 43,554 | |||||||||
| Total revenue | 10,620 | 3,104 | 15,690 | 44,504 | |||||||||
| Cost of revenue from third-parties | 9,906 | 244 | 14,674 | 751 | |||||||||
| Cost of revenue from related parties | — | — | 2 | 467 | |||||||||
| Gross profit | 714 | 2,860 | 1,014 | 43,286 | |||||||||
| Operating expenses: | |||||||||||||
| Selling, general and administrative expenses | 7,636 | 7,770 | 20,188 | 18,443 | |||||||||
| Research and development | 1,318 | — | 1,318 | — | |||||||||
| Professional fees | 3,968 | 1,389 | 8,096 | 3,918 | |||||||||
| Impairment loss | 3,275 | 2,299 | 10,363 | 2,299 | |||||||||
| Change in fair value of contingent consideration, net | (4,179) | — | (2,900) | — | |||||||||
| Depreciation and amortization | 695 | 806 | 1,651 | 1,420 | |||||||||
| Total operating expenses | 12,713 | 12,264 | 38,716 | 26,080 | |||||||||
| Income (loss) from operations | (11,999) | (9,404) | (37,702) | 17,206 | |||||||||
| Interest and other income (expense): | |||||||||||||
| Interest expense, net | (2,014) | (639) | (14,061) | (1,955) | |||||||||
| Equity in income (loss) of equity method investees | 7 | (40) | (8) | (606) | |||||||||
| Gain on disposal of subsidiaries | — | 1,057 | — | 1,057 | |||||||||
| Loss on remeasurement of DBOT investment | — | (3,179) | — | (3,179) | |||||||||
| Conversion expense | — | — | (2,266) | — | |||||||||
| Other income (expense) | 5,283 | (100) | 6,272 | (156) | |||||||||
| Income (loss) before income taxes and non-controlling interest | (8,723) | (12,305) | (47,765) | 12,367 | |||||||||
| Income tax benefit | — | — | — | 514 | |||||||||
| Net income (loss) | (8,723) | (12,305) | (47,765) | 12,881 | |||||||||
| Deemed dividend related to warrant repricing | — | — | (184) | — | |||||||||
| Net loss (income) attributable to non-controlling interest | 437 | (1,408) | 737 | (1,374) | |||||||||
| Net income (loss) attributable to IDEX common shareholders | $ | (8,286) | $ | (13,713) | $ | (47,212) | $ | 11,507 | |||||
| Earnings (loss) per share | |||||||||||||
| Basic | $ | (0.03) | $ | (0.11) | $ | (0.25) | $ | 0.10 | |||||
| Diluted | (0.03) | (0.11) | (0.25) | 0.10 | |||||||||
| Weighted average shares outstanding: | |||||||||||||
| Basic | 237,535,999 | 127,609,748 | 191,976,856 | 113,964,933 | |||||||||
| Diluted | 237,535,999 | 127,609,748 | 191,976,856 | 118,319,893 | |||||||||
The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.