Senmiao Technology Reports Fiscal 2022 Third Quarter Financial Results

CHENGDU,China,Feb. 15,2022 --Senmiao Technology Limited ("Senmiao") (Nasdaq: AIHS),a financing and servicing company focused on the online ride-hailing industry in China as well as an operator of its own online ride-hailing platform,today announced financial results for the fiscal 2022 third quarter ended December 31,2021. Additional information regarding Senmiao's results of operations for the quarter endedDecember 31,2021,can be found in the quarterly report on Form 10-Q that was filed with the U.S. Securities and Exchange Commission on February 14,2022.

Fiscal 2022 Third Quarter Financial and Operating Highlights

Total revenues of $3.5 million,an increase of approximately 116% from $1.6 million in the prior-year period,primarily as a result of increased operating lease revenues from automobile rentals and revenues from online ride-hailing platform services.

Net loss from continuing operations was $0.1 million,decreased from net loss of $3.7 million in the prior-year period.

During the nine months ended December 31,approximately 10.2 million rides were completed through Senmiao's platform with gross fares paid by riders totaling $32.2 million.

During the three months ended December 31,Senmiao launched its online ride-hailing platform in five cities,expanding its relationship with Gaode Map (AutoNavi Software Co.,Ltd.) to Xuzhou and Suzhou,two major cities in Jiangsu Province; Hezhou,a city in Guangxi Province; Shenyang,the capital of Liaoning Province; and Haikou,the capital of Hainan Province.

Management Commentary

Xi Wen,Chairman,Chief Executive Officer and President of Senmiao,stated,"We are pleased that our continued top line growth has resulted in an improved bottom line during the third quarter of fiscal year 2022. Our business is primarily driven by our automobile rental leasing business and online ride-hailing platform services. Since its launch in October 2020,we have helped facilitate over 18.1 million rides in 14 cities as of the end of January 2022. As we continue to launch the platform in new cities and expand our relationships with key partners,we anticipate operating lease revenues from automobile rentals will continue to grow,as will revenue from online ride-hailing platform services,which we expect will accelerate our return to profitability."

Mr. Wen continued,"During the first nine months of fiscal year 2022,we have continued to deepen our strategic relationships with partners such as Meituan and Gaode Map while establishing new cooperations with brands that have a strong local presence in existing and new markets. We believe developing an extensive network of trusted partners will play a critical role in elevating Senmiao's position as a leading online ride-hailing platform provider in China. We look forward to working closely with new and existing partners as we serve an ever-growing population of ride-hailing drivers and riders."

Financial Review

Revenues

Total revenues were $3.5 million for the fiscal third quarter endedDecember 31,an increase of 116% from $1.6 million in the prior-year period and an increase of 24% from $2.9 million in the prior sequential quarter. The increase was largely due to the $1.0 million increase in operating lease revenues from automobile rentals and $0.7 million increase in revenue contributions from online ride-hailing platform services,which was supported by the launches of our platform in 11 new cities in China as well as the new cooperation model with Meituan during the fiscal third quarter as compared with the prior-year period.This was partiallyoffset by a lack of revenue contributions from the Company's legacy businesses related to automobile sales and facilitation of automobile transactions and financing,which was a result of the Company's shift in business focus to automobile leasing.

Cost of Revenues

Cost of revenues increased to $2.7 millionfor the fiscal third quarter endedDecember 31,compared to$1.8 millionin the prior-year period,primarily due to a $0.4 million increase in cost of automobiles under operating leases and $0.7 million increase in direct expense and technical service fees related to Senmiao's online ride-hailing platform.The increase in these two segments is mainly attributable to the expansion of these two businesses.

Gross Profit

Gross profit was$0.9 million for the fiscal third quarter endedDecember 31,compared to gross loss of $0.2 million in the prior-year period,primarily as a result of the growth in Senmiao's operating lease business and the new cooperation model with Meituan.

Selling,General and Administrative Expenses

Selling,general and administrative expenses increased to $3.8 million for the fiscal third quarter endedDecember 31,from $2.4 million in the prior-year period. The increase was mainly attributable to a $0.6 million increase in salary and employee benefits as Senmiao's employee headcount increased from 241 to 333; a $0.3 million increase in offices rental and charges; and a $0.5 million increase in financial,legal and marketing consulting,which were partially offset by a $0.3 million decrease in amortization of intangible assets and rendered automobiles that have not been sub-leased as Senmiao leased more automobiles during this quarter than in the prior-year period.

Net Loss

Net loss from Senmiao's continuing operations for the fiscal third quarter ended December 31,improved to $0.1 million,from a net loss of $3.7 million in the prior-year period. This was primarily the result of the increased revenues,costs and the gain in change in fair value of derivative liabilities. During the fiscal third quarter ended December 31,Senmiao had a gain of $3.6 million from change in fair value of derivative liabilities related to warrants issued in Senmiao's historical offerings,from a loss of $1.0 million in the prior-year period.

Earnings (Loss) per Share

Earnings per share for continuing operations for the fiscal third quarter endedDecember 31,wasapproximately $0.00 based on a weighted average number of basic and diluted common stock of 59.2 million,compared to loss per share of approximately $0.07 based on a weighted average number of basic and diluted common stock of 43.8 million in the prior-year period.

Financial Position

As ofDecember 31,Senmiao had cash and cash equivalents of$2.8 million,compared to$4.4 millionas ofMarch 31,2021.

About Senmiao Technology Limited

Headquartered in Chengdu,Sichuan Province,Senmiao provides automobile transaction and related services including sales of automobiles,facilitation and services for automobile purchase and financing,management,operating lease,guarantee and other automobile transaction services as well as operates its own ride-hailing platform aimed principally at the growing online ride-hailing market in Senmiao's areas of operation in China. For more information about Senmiao,please visit: http://www.senmiaotech.com. Senmiao routinely provides important updates on its website.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995. These forward-looking statements (including statements concerning the development of Senmiao's automobile transaction,financing,rental and related services and online ride-hailing platform,the Chinese ride-hailing and automobile financial leasing markets,Senmiao's plans,objectives,goals,strategies,and performance,and the impact of COVID-19 on Senmiao's business),as well as the assumptions such statements and other statements that are not statements of historical facts are subject to significant risks,uncertainties and assumptions,including those detailed from time to time in Senmiao's filings with the SEC,and represent Senmiao's views only as of the date they are made and should not be relied upon as representing Senmiao's views as of any subsequent date. Senmiao undertakes no obligation to publicly revise any forward-looking statements to reflect changes in events or circumstances.

For more information,please contact:

At the Company:

Yiye Zhou

Email: edom333@ihongsen.com

Phone: +86 28 6155 4399

Investor Relations:

The Equity Group Inc. In China

Carolyne Sohn,Vice President Lucy Ma,Associate

+1 415-568-2255 +86 10 5661 7012

csohn@equityny.com lma@equityny.com

© 2022 Senmiao Technology Ltd. All rights reserved.

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(Expressed in U.S. dollar,except for the number of shares)

December31,

March31,

2021

2021

(Unaudited)

ASSETS

Current assets

Cash,and cash equivalents

$

2,801,711

$

4,448,075

Accounts receivable,net,current portion

794,389

1,437,195

Inventories

211,054

127,933

Finance lease receivables,current portion

356,504

541,605

Prepayments,other receivables and other assets,net

3,797,476

3,905,278

Due from related parties

27,938

39,572

Current assets - discontinued operations

12,334

393,348

Total current assets

8,001,406

10,893,006

Property and equipment,net

Property and equipment,net

6,429,798

3,700,147

Property and equipment,net - discontinued operations

—

5,592

Total property and equipment,net

6,798

3,705,739

Other assets

Operating lease right-of-use assets,net

354,312

499,221

Operating lease right-of-use assets,related parties

578,951

580,367

Financing lease right-of-use assets,net

2,096,466

4,778,772

Intangible assets,net

939,193

968,131

Goodwill

—

135,388

Accounts receivable,noncurrent

29,275

269,183

Finance lease receivables,noncurrent

158,163

473,472

Total other assets

4,156,360

7,704,534

Total assets

$

18,587,564

$

22,303,279

LIABILITIES,MEZZANINE EQUITY AND EQUITY

Current liabilities

Borrowings from financial institutions

$

500,363

$

310,662

Accounts payable

124,052

44,769

Advances from customers

749,345

155,586

Income tax payable

17,947

17,408

Accrued expenses and other liabilities

6,561,161

6,655,592

Due to related parties and affiliates

364,705

352,827

Operating lease liabilities

156,769

209,644

Operating lease liabilities - related parties

366,998

243,726

Financing lease liabilities

4,526,480

5,172,943

Derivative liabilities

3,981,377

1,278,926

Current liabilities - discontinued operations

527,104

2,336,861

Total current liabilities

17,876,301

16,944

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(CONTINUED)

(Expressed in U.S. dollar,

2021

2021

(Unaudited)

Other liabilities

Borrowings from financial institutions,noncurrent

27,982

44,962

Operating lease liabilities,non-current

179,778

263,708

Operating lease liabilities,non-current - related parties

293,987

341,549

Financing lease liabilities,non-current

1,311,647

2,256,553

Deferred tax liability

46,386

44,993

Total other liabilities

1,859,780

2,951,765

Total liabilities

19,736,081

19,730,709

Commitments and contingencies

Mezzanine equity (redeemable)

Series A convertible preferred stock (par value $0.0001 per share,5,000 shares authorized; 5,000

and 0 shares issued and outstanding at December 31,2021 and March 31,respectively),

net of issuance costs of $118,344

820,799

—

Stockholders' equity (deficiency)

Common stock (par value $0.0001 per share,100,000,000 shares authorized; 61,783,794 and

49,780,725 shares issued and outstanding at December 31,

respectively)

6,178

4,978

Additional paid-in capital

42,430,881

40,755,327

Accumulated deficit

(39,738,151)

(34,064,921)

Accumulated other comprehensive loss

(778,437)

(838,671)

Total Senmiao Technology Limited stockholders' equity

1,920,471

5,856,713

Non-controlling interests

(3,889,787)

(3,284,143)

Total equity (deficiency)

(1,969,316)

2,572,570

Total liabilities,mezzanine equity and equity (deficiency)

$

18,279

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(Expressed in U.S. dollar,except for the number of shares)

For the Three Months Ended December31,

For the Nine Months Ended December31,

2021

2020

2021

2020

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

Revenues

$

3,543,049

$

1,638,550

$

8,249,033

$

4,175,862

Cost of revenues

(2,692,177)

(1,793,815)

(9,339,832)

(3,588,586)

Gross profit (loss)

850,872

(155,265)

(1,090,799)

587,276

Operating expenses

Selling,general and administrative expenses

(3,764,222)

(2,401,250)

(10,219)

(7,110,884)

Provision for doutful accounts,net of

recovery

22,330

187,907

(80,410)

106,835

Impairments of long-lived assets and

goodwill

(7,982)

(41,983)

(178,125)

(122,206)

Total operating expenses

(3,749,874)

(2,255,326)

(10,687,754)

(7,126,255)

Loss from operations

(2,899,002)

(2,410,591)

(11,553)

(6,538,979)

Other income (expense)

Other expense(income),net

170,847

(72,586)

152,893

56,795

Interest expense

(16,475)

(2,158)

(44,123)

(37,698)

Interest expense on finance leases

(97,919)

(150,227)

(313,766)

(587,457)

Change in fair value of derivative liabilities

3,536,859

(1,030,843)

5,185,309

(1,443,784)

Issuance costs for issuing series A

convertible preferred stock

(821,892)

—

(821,892)

—

Total other income (expense),net

2,771,420

(1,814)

4,158,421

(2,012,144)

Loss before income taxes

(127,582)

(3,666,405)

(7,620,132)

(8,551,123)

Income tax expense

(4,539)

(7,487)

(4,550)

(14,464)

Net loss from continuing operations

(132,121)

(3,673,892)

(7,624,682)

(8,565,587)

Net loss from discontinued operations,net of

applicable income taxes

—

(572)

—

(78,351)

Net loss

(132,674,464)

(7,643,938)

Net loss attributable to non-controlling

interests from continuing operations

287,580

593,452

1,697

Net income (loss) attributable to the

Company's stockholders

$

155,459

$

(3,081,012)

$

(5,230)

$

(7,242,241)

Net loss

$

(132,121)

$

(3,464)

$

(7,682)

$

(8,938)

Other comprehensive income (loss)

Foreign currency translation adjustment

70,638

(61,953)

48,458

(215,452)

Comprehensive loss

(61,483)

(3,417)

(7,576,224)

(8,390)

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS

(CONTINUED)

(Expressed in U.S. dollar,

2021

2020

2021

2020

(Unaudited)

(Unaudited)

(Unaudited)

(Unaudited)

less: Total comprehensive loss attributable to

noncontrolling interests

(303,768)

(252,130)

(1,984,990)

(1,038,954)

Total comprehensive income (loss)

attributable to stockholders

$

242,285

$

(3,484,287)

$

(5,591,234)

$

(7,820,436)

Weighted average number of common stock

Basic and diluted

59,226,547

43,822,321

55,792,713

36,906,608

Earnings (loss) per share - basic and diluted

Continuing operations

$

0.00

$

(0.07)

$

(0.10)

$

(0.19)

Earnings (loss) per share -

Discontinued operations

$

—

$

(0.00)

$

—

$

(0.00)

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in U.S. dollar,except for the number of shares)

For the Nine Months Ended December31,

2021

2020

(Unaudited)

(Unaudited)

Cash Flows from Operating Activities:

Net loss

$

(7,938)

Net loss from discontinued operations

—

(78,351)

Net loss from continuing operations

(7,587)

Adjustments to reconcile net income (loss) to net cash used in operating activities:

Depreciation and amortization of property and equipment

849,642

175,884

Stock compensation expense

653,000

445,000

Issuance costs for series A convertible preferred stock

821,892

—

Amortization of right-of-use assets

3,347,999

3,119,274

Amortization of intangible assets

104,829

59,209

Provision for doubtful accounts,net of recovery

80,410

(106,835)

Impairments of long-lived assets

178,125

122,206

Gain (loss) on disposal of equipment

—

(420)

Change in fair value of derivative liabilities

(5,309)

1,784

Change in operating assets and liabilities

Accounts receivable

820,818

227,174

Inventories

(126,351)

226,852

Prepayments,other receivables and other assets

396,788

137,701

Finance lease receivables

524,831

113,911

Accounts payable

76,877

174,160

Advances from customers

581,180

52,453

Income tax payable

—

7,847

Accrued expenses and other liabilities

(231,230)

2,223,905

Operating lease liabilities

(149,466)

(132,885)

Operating lease liabilities - related parties

(124,143)

68,326

Net cash used in operating activities from continuing operations

(5,004,790)

(208,041)

Net cash used in operating activities from discontinued operations

(1,454,382)

(1,578,633)

Net Cash Used in Operating Activities

(6,459,172)

(1,786,674)

Cash Flows from Investing Activities:

Purchases of property and equipment

(3,460,067)

(199,896)

Purchases of intangible assets

(76,637)

—

Cash acquired from XXTX,net of cash paid to XXTX

—

7,975

Net cash used in investing activities from continuing operations

(3,704)

(191,921)

Net cash used in investing activities from discontinued operations

(1,398)

(2,258)

Net Cash Used in Investing Activities

(3,102)

(194,179)

SENMIAO TECHNOLOGY LIMITED

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(CONTINUED)

(Expressed in U.S. dollar,

2021

2020

(Unaudited)

(Unaudited)

Cash Flows from Financing Activities:

Net proceeds from issuance of common stock and warrants in registered direct

offering

5,053

—

Net proceeds from issuance of common stock and warrants in an underwritten public

offering

—

6,098,297

Net proceeds from issuance of common stock upon warrants exercised

22,015

496,117

Net proceeds from issuance of series A convertible preferred stock and warrants in a

private placement offering

4,369,937

—

Borrowings from a financial institution

693,777

508,275

Loan to related parties

(171,738)

—

Borrowings from related parties and affiliates

15,546

—

Repayments to related parties and affiliates

—

(213,342)

Repayments of current borrowings from financial institutions

(529,226)

(354,504)

Principal payments of finance lease liabilities

(1,994,077)

(1,214)

Net cash provided by financing activities from continuing operations

8,177,287

4,763,629

Net cash used in financing activities from discontinued operations

—

(167,315)

Net Cash Provided by Financing Activities

8,596,314

Effect of exchange rate changes on cash and cash equivalents

173,623

83,332

Net (decrease) increase in cash and cash equivalents

(1,646,364)

2,698,793

Cash and cash equivalents,beginning of period

4,075

844,027

Cash and cash equivalents,end of period

2,711

3,542,820

Less: Cash and cash equivalents from discontinued operations

—

—

Cash and cash equivalents from continuing operations,end of period

$

2,711

$

3,820

Supplemental Cash Flow Information

Cash paid for interest expense

$

44,123

$

35,419

Cash paid for income tax

$

—

$

—

Non-cash Transaction in Investing and Financing Activities

Recognition of right-of-use assets and lease liabilities

$

196,671

$

3,145,506

Recognition of right-of-use assets and lease liabilities,related parties

$

180,973

$

—

Acquisition of equipment through prepayment and financing lease receivables offset

$

—

$

540,968

Allocation of fair value of derivative liabilities for issuance of common stock proceeds

$

7,933,434

$

(241,919)

Allocation of fair value of derivative liabilities to additional paid in capital upon

warrants exercised

$

45,674

$

984,803

Acquisition of XXTX with payables

$

—

$

314,290

Acquisition of XXTX's minority interest with issuance of common stock at fair value

$

1,972,717

$

—

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