China-based AAV technology platform EHang Holdings has released its unaudited financial results for the second quarter 2022.
Financial and operational highlights show total revenues of $2.2 million, an increase of 152.5 per cent in the first quarter of 2022. Gross margin was 67.1 per cent, maintaining a high level with a further increase of 4.6 percentage points in the first quarter of 2022.
Operating loss was $11.1 million, around $1.5m greater than in the first quarter of 2022. Adjusted operating loss (non-GAAP) was $7.6 million, net loss was $11.0 million, and adjusted net loss (non-GAAP) was $7.6 million; all greater than for the first quarter. Cash, cash equivalents, restricted cash and short-term investments balances were $35.9 million as of 30 June, 2022.
Sales and deliveries of EHang 216 AAVs totalled eight units, representing an increase of 166.7 per cent from the three units in the first quarter of 2022. Under the 100 Air Mobility Routes Initiative, more than 5,700 operational trial flights of the EHang 216 have been conducted in practical scenarios at 11 operation spots in China to date.
Business highlights for the second quarter 2022 and recent updates include progression of the EH216-S type certification (TC) process into new phases following the Civil Aviation Administration of China (CAAC) issuing EHang with the first special conditions for TC of a human-carrying unmanned aircraft system specially for EH216-S in February 2022. The CAAC TC expert team and EHang have reached a consensus on the project specific certification plan, certification basis and the certification plan, respectively.
On top of references to CCAR-23 and many other internationally recognised regulations and standards, and conventional aircraft configuration management and airworthiness experience, the certification team has further explored topics related to unmanned aircraft systems such as data link and ground control systems, and has worked out 13 means of compliance applicable to the EH216. It is continuing to carry out internal tests and plan the activities for the demonstration of compliance.
The company has completed deliveries of all five units of an initial June 2022 purchase order from Tianxingjian Cultural Tourism Investment and Development, an affiliated enterprise of the Jishou city government in China's Hunan province. The two parties plan to develop a scenic flight project at the Aizhai Wonder Tourist Area in Jishou and have initiated trial flight operations since the second quarter. Tianxingjian plans to purchase an additional 25 units as the project progresses.
Also in June, EHang entered into a strategic partnership with the Guangzhou Branch of Agricultural Bank of China for comprehensive banking services, including indicative credit facilities of RMB1 billion, to support operations in China. This partnership will offer tremendous support for the company's long term sustainable business growth, including on R&D, manufacturing, and sales and operations.
In April, Indonesian aviation company Prestige Aviation pre-ordered 100 units. It had previously purchased one unit with successful flight demonstrations conducted in Bali and Jakarta, Indonesia. And in May, EHang partnered with Thailand-based conglomerate Charoen Pokphand Group to establish a joint venture in Thailand for AAV sales and urban air mobility operations.
Founder, chairman and chief executive officer Huazhi Hu says: “During the past quarter, we achieved excellent results from our efforts in actively adapting to the macro environment and gradually recovering from the continuous impact of the Covid resurgence in China. Our unique and leading AAV products and solutions drove the increases in orders, pre-orders, deliveries and customers especially in domestic and southeast Asia markets, bringing total revenues to an increase of up to 152.5 per cent quarter-over-quarter and high quarterly gross margin of 67.1 per cent. We are pleased to expand our strategic business and financial partners, such as CP Group in Thailand on AAV sales and UAM operations and the Agricultural Bank of China Guangzhou Branch with RMB1 billion indicative credit facilities for long term cooperation, which will further diversify our funding sources to propel our future growth.
“More importantly, we are grateful for both the CAAC and our certification team's efforts, professionalism, innovation spirit and great support that made our certification progress and breakthrough possible, bringing us closer to the goal of the EH216-S type certification and a new era of urban air mobility.”