Author: Weiwen
Source: GPLP
For NIO(NIO. NYSE), its will have not more time to get rid of the name for “metal swallowing beast”.
On March 18, NIO released the results for the fourth quarter of 2019 and the whole year. According to the report, the annual revenue of 2019 is 7.825 billion yuan, up 58% year on year; the net loss attributable to shareholders of listed companies is 11.413 billion yuan, down 51% year on year.
In the fourth quarter, the revenue of NIO was 2.85 billion yuan, down 17.1% year-on-year; the net loss attributable to shareholders of listed companies was 2.836 billion yuan, down 18% year-on-year, and the adjusted net loss was 2.775 billion yuan, down 16% year-on-year.
In addition, as of December 31, 2019, the cash and cash equivalents, restricted cash and short-term investment held by NIO was 1.056 billion yuan, compared with 8.345.6 billion yuan at the end of 2018.
It can be seen that, as of December 31, 2019, the capital expenditure of NIO has improved significantly, but on the whole, it is not optimistic.
Li Bin, CEO of NIO, is also very frank about this situation, saying that the cash balance of NIO is not enough to provide working capital and their needed for continuous operation in the next 12 months.
Is NIO really hopeless?
In fact, GPLP learned that since 2020, NIO has completed three convertible bond financing in less than four months, with a financing amount of up to 17.5 billion yuan.
Not only that, NIO has recently signed a 10 billion yuan framework agreement with Hefei municipal government. NIO will establish a China headquarters in Hefei, and Hefei will provide resources and financial support for the operation and development of NIO in China. The final agreement is expected to be signed by the end of April.
In this way, NIO, who was in danger, could take a little breath.
In this regard, NIO are also under certain pressure. After all, since its establishment nearly six years ago, NIO have not only failed to turn losses into profits, but also the gross profit margin has been negative, which also means that NIO still have the state of losing one car for every car sold.
In addition, it should be noted that Tesla, as the predecessor of NIO, just achieved a positive gross profit rate in the sixth year. Although there was a negative gross profit rate in 2010-2011 and 2017-2018, it can also be reversed rapidly.
But if NIO can’t reach the same level as Tesla, the financing will be more difficult.
At present, Li Bin has publicly stated that with the optimization of the supply chain, the continuous reduction of the cost of battery packs, the increase of production scale and the decrease of the average manufacturing cost of vehicles brought by the optimization of management, the gross profit rate of NIO will become positive in the second quarter of 2020 and reach double figures at the end of the year.
However, GPLP will continue to pay attention to whether the future trend of NIO is as expected by Li Bin.
