MICT, Inc. Reports Fourth Quarter and Full Year 2021 Results with $55M Annual Revenues
$9.2M in Gross Profit by Insurance Business for Full Year 2021, of which $3.9M in Gross Profit Was Delivered in Q4, Equating to Quarter-over-Quarter Growth of 39.3%
Due Diligence on Tingo Inc. Has Been Completed and The Merger Agreement Updated and Reaffirmed
MONTVALE, N.J., June 17, 2022 (GLOBE NEWSWIRE) -- MICT, Inc. (Nasdaq: MICT), (the "Company"), today announced its financial results for the fourth quarter and fiscal year ended December 31, 2021.
Year End 2021 Highlights and Recent Developments
Darren Mercer, MICT’s Chief Executive Officer commented, “We are pleased that COVID-19 conditions in Shanghai and certain other provinces recently improved such that we have now been able to finalize our audit and financial results. Following the launch of our insurance business towards the end of December of 2020, we grew it into a thriving enterprise with $55 million in revenues. While insurance commission revenues declined in the fourth quarter because of a change in government regulation, our volume growth and gross profit growth continues strongly as we expand our product range to add more profitable specialty insurance products, in addition to our core B2B offerings. The positive impact on our gross margins is evidenced by the quarter-over-quarter increase in our gross profit from $2.8 million in Q3 to $3.9 million in Q4, an increase of $1.1 million or 39.3%, and by the significant increase in our gross profit margin to 24%, up from 15% in Q3 and 5% in Q2. Following the lifting of COVID-19 lockdowns in certain key provinces in China, we have been able to resume our work towards introducing our B2B2C and B2C insurance products, which we expect to launch in the second half of 2022, and which we are confident will result in a continuation of our increase in margins and revenues.
“We officially launched our stock trading app in September 2021 and continue to improve the technology with more features and functionality. This is an ongoing process to develop an app that is a world class product. While the revenues generated from our stock trading app were minimal in the fourth quarter, we expect dramatic growth in the coming year as we expand internationally and entertain a number of exciting white-label partnerships and joint venture opportunities. As part of our globalization strategy, we recently received our Capital Markets License (“CMS License”) in Singapore, and, as announced yesterday, are looking for additional expansion opportunities in Australia, as well as in Europe and the U.S. Our CMS License not only allows us to operate throughout Singapore and onboard clients from several other countries, it, together with the Money Services Operators License we have applied for, will also allow us to launch a number of new products, including payment services, foreign exchange services, and CFDs, including commodity CFDs and cryptocurrency CFDs.
“On May 10th, we announced the execution of a definitive merger agreement with Tingo, a leading and highly profitable Agri-Fintech company operating in Africa, and this week we completed the due diligence and have updated and reaffirmed our definitive merger agreement. Tingo provides a fintech and marketplace platform that amongst other things provides Africa’s farmers with access to international markets to secure pricing for their produce. We are very excited about the opportunities and synergies arising from the combination of MICT and Tingo, including the opportunity to create one of the world’s leading fully integrated fintech platforms, with combined financial services, payment services, a marketplace and an e-wallet, together with our own wealth management, stock trading and insurance products. We are also excited about the opportunity to introduce Tingo’s platform and products into China and other parts of Asia, and about the opportunity to work with Tingo to accelerate the globalization of our business. Following the completion of due diligence, MICT and Tingo are working together to meet the closing conditions for the Merger, including obtaining stockholder approval, the satisfaction of regulatory requirements and the SEC declaration of effectiveness of a Registration Statement, all of which we aim to achieve during the third quarter of this year,” concluded Mr. Mercer.
Q4 2021 Financial Review
About MICT, Inc.
This press release contains express or implied forward-looking statements within the Private Securities Litigation Reform Act of 1995 and other U.S. Federal securities laws. All statements other than statements of historical fact contained in this press release are forward-looking statements. The words “believe,” “may” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect” and similar expressions, as they relate to us, are intended to identify forward-looking statements. We have based these forward-looking statements on our current expectations and projections about future events and financial trends that we believe may affect our financial condition, results of operations, business strategy, business prospectus, growth strategy and liquidity. Such forward-looking statements and their implications including, but not limited to, the ability to consummate the merger with Tingo involve known and unknown risks, uncertainties and other factors that may cause actual results or performance to differ materially from those projected. The forward-looking statements contained in this press release are subject to other risks and uncertainties, including those discussed in the “Risk Factors” section and elsewhere in the Company’s annual report on Form 10-K for the year ended December 31, 2021, and in subsequent filings with the Securities and Exchange Commission. Except as otherwise required by law, the Company is under no obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements whether as a result of new information, future events or otherwise.
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CONSOLIDATED STATEMENTS OF OPERATIONS
(In Thousands, Except Share and Loss Per Share data)
Non-GAAP Financial Measures
In addition to providing financial measurements based on generally accepted accounting principles in the U.S., or GAAP, we provide additional financial metrics that are not prepared in accordance with GAAP, or non-GAAP financial measures. Management uses non-GAAP financial measures, in addition to GAAP financial measures, to understand and compare operating results across accounting periods, for financial and operational decision making, for planning and forecasting purposes and to evaluate our financial performance.
Management believes that these non-GAAP financial measures reflect our ongoing business in a manner that allows for meaningful comparisons and analysis of trends in our business, as they exclude expenses and gains that are not reflective of our ongoing operating results. Management also believes that these non-GAAP financial measures provide useful information to investors in understanding and evaluating our operating results and future prospects in the same manner as management and in comparing financial results across accounting periods and to those of peer companies.
The non-GAAP financial measures do not replace the presentation of our GAAP financial results and should only be used as a supplement to, not as a substitute for, our financial results presented in accordance with GAAP.
The non-GAAP adjustments, and the basis for excluding them from non-GAAP financial measures, are outlined below:
The following table reconciles, for the periods presented, GAAP net loss attributable to MICT to non-GAAP net income attributable to MICT. and GAAP loss per diluted share attributable to MICT to non-GAAP net loss per diluted share attributable to MICT.: