CBAK Energy Reports Third Quarter 2021 Unaudited Financial Results
CBAK Energy Technology reported its unaudited financial results for Q3 2021, showcasing strong growth in high-power lithium battery revenues of $9.6 million, up 51% year-over-year. However, gross profit declined 17% to $1.1 million, with a gross margin of 12%. Despite the overall decline in net income, which soared to $20 million compared to just $41,715 a year prior, operating losses increased to $3.2 million. The company also reported a substantial rise in operating expenses due to headcount growth and R&D costs, while cash reserves decreased from $33.3 million to $2 million.
- High-power lithium battery revenues grew by 51% year-over-year.
- Net income increased significantly to $20 million from $41,715 year-over-year.
- Basic and diluted earnings per share rose to $0.23, compared to $0.00 in the same quarter of 2020.
- Gross profit decreased by 17% from the previous year.
- Operating losses grew to $3.2 million, compared to an operating profit of $0.4 million in Q3 2020.
- Total operating expenses surged by 339%, driven by increased headcount and R&D costs.
DALIAN, China, Nov. 12, 2021 /PRNewswire/ -- CBAK Energy Technology, Inc. (NASDAQ: CBAT) ("CBAK Energy," or the "Company") a leading lithium-ion battery manufacturer and electric energy solution provider in China, today reported its unaudited financial results for the third quarter ended September 30, 2021.
Third Quarter 2021 Financial Highlights
- Net revenues were
$9.6 million . Excluding revenues from raw material trades, approximately$9.6 million was from high power lithium batteries business, a51% year-over-year growth in high power lithium battery revenues over the same period of 2020. - Gross profit was
$1.1 million , a decrease of17% from$1.4 million in the same period of 2020. - Gross margin was
12% , a decrease of 1 percentage point from the same period of 2020. - Net Income was
$20.0 million , compared to net income of$41,715 in the same period of 2020.
Yunfei Li, Chairman and Chief Executive Officer of the Company, noted: "We are very pleased with our robust battery sales in the third quarter. Notably, revenues from high-power lithium batteries totaled
Mr. Li continued: "As scheduled, we are expanding our production capacity despite global energy shortage and commodity price hikes. This is a much-needed action as the new capacity will yield positive business outcomes and augment our ability to supply. Additionally, in order to address growing and diversified demands for batteries, we made meaningful progress in research and development while extending our product portfolio. Our operations and growth strategies are well on track, which we believe solidifies our market-leading position and capabilities to deliver long-term growth in this thriving industry."
Xiangyu Pei, Interim Chief Financial Officer of the Company, noted: "Our financial performance for high-power lithium batteries remained solid in the third quarter, a testament to the strong demand for our advanced and dependable products. Despite the increase in commodity prices, raw material cost was carefully managed through our previous contracts that have locked prices for certain materials. As evidenced by our healthy financial position and vigorous growth, we have the capabilities for executing our growth strategies that will push us further on the path to consistent, sustainable success."
Third Quarter 2021 Business Highlights & Recent Developments
- In August, the Company secured performance certification from the world's leading testing, inspection and certification company SGS for its special 26650 lithium-ion battery, specifically designed for use in ultra-low temperatures.
Third Quarter 2021 Financial Results
Net revenues were
Net Revenues by End-product Applications | 2021 | 2020 | % Change | ||||||
High power lithium batteries used in: | |||||||||
Uninterruptable supplies | 58 | ||||||||
Light electric vehicles | 227 | 23 | 887 | ||||||
Electric vehicles | 1 | 408 | (100) | ||||||
Total high power lithium batteries | 51 | ||||||||
Raw materials used in lithium batteries | (1) | 4,269 | (100) | ||||||
Total | (10) |
Cost of revenues was
Gross profit was
Total operating expenses were
- Research and development expenses were
$1.8 million , an increase of307% from$0.4 million in the same period of 2020. The increase in research and development expenses was also due to the Company's efforts in optimizing performance and cost-efficiency for battery products. - Sales and marketing expenses were
$0.5 million , an increase of223% from$0.2 million in the same period of 2020. Given the growth in revenues from high power lithium batteries, we increased salaries and benefits for sales and marketing employees. - General and administrative expenses were
$2.2 million , an increase of191% from$0.7 million in the same period of 2020. The Company's rental expenses increased as it rented spaces for manufacturing, warehouse, and staff accommodation for the Nanjing production facility. - Recovery of doubtful accounts was
$0.2 million , compared to a recovery of doubtful accounts of$0.4 million in the same period of 2020.
Operating Loss was
Finance income, net was
Change in fair value of warrant liabilities was
Net Income was
Basic and diluted earnings per share were both
Cash and cash equivalents were
Conference Call
CBAK's management will host an earnings conference call at 8:00 AM U.S. Eastern Time on Friday, November 12, 2021 (9:00 PM Beijing/Hong Kong Time on November 12, 2021).
For participants who wish to join the call, please register in advance for the conference using the link provided below at least 15 minutes prior to the scheduled call start time. Upon registration, participants will receive the conference call access information, including dial-in numbers, Direct Event passcode, a unique registrant ID and an email with detailed instructions to join the conference call.
Participant Online Registration:
http://apac.directeventreg.com/registration/event/9955106
Once completing the registration, please dial-in at least 10 minutes before the scheduled start time of the earnings call and enter the Direct Event passcode and registrant ID as instructed to connect to the call.
Additionally, a live and archived webcast of the conference call will be available at: https://edge.media-server.com/mmc/p/3k3p9eyw.
A replay of the conference call may be accessed by phone approximately two hours after the conclusion of the live call at the following numbers until November 20, 2021. To access the replay, please reference the conference ID 5182755.
International | +61-2-8199-0299 |
United States | +1-855-452-5696 |
Hong Kong, China | +852-800-963-117 |
Mainland, China | +86-800-870-0206 |
+86-400-632-2162 |
About CBAK Energy
CBAK Energy Technology, Inc. (NASDAQ:CBAT)is a leading high-tech enterprise in China engaged in the development, manufacturing, and sales of new energy high power lithium batteries. The applications of the Company's products and solutions include light electric vehicles, electric vehicles, electric tools, energy storage, uninterruptible power supply (UPS), and other high-power applications. In January 2006, CBAK Energy became the first lithium battery manufacturer in China listed on the Nasdaq Stock Market. CBAK Energy has multiple operating subsidiaries in Dalian and Nanjing, as well as a large-scale R&D and production base in Dalian.
For more information, please visit www.cbak.com.cn.
Safe Harbor Statement
This press release contains forward-looking statements, which are subject to change. The forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All "forward-looking statements" relating to the business of CBAK Energy Technology, Inc. and its subsidiary companies, which can be identified by the use of forward-looking terminology such as "believes", "expects" or similar expressions, involve known and unknown risks and uncertainties which could cause actual results to differ materially. These factors include but are not limited to: the ability of the Company to meet its contract or agreement obligations; the uncertain market for the Company's lithium battery cells; business, macroeconomic, technological, regulatory, or other factors affecting the profitability of battery cells designed for energy storage; and risks related to CBAK Energy's business and risks related to operating in China. Please refer to CBAK Energy's most recent Annual Report on Form 10-K, as well as other SEC reports that have been filed since the date of such annual report, for specific details on risk factors. Given these risks and uncertainties, you are cautioned not to place undue reliance on forward-looking statements. CBAK Energy's actual results could differ materially from those contained in the forward-looking statements. CBAK Energy undertakes no obligation to revise or update its forward-looking statements in order to reflect events or circumstances that may arise after the date of this release unless expressly requested by applicable law.
For investor and media inquiries, please contact:
In China:
CBAK Energy Technology, Inc.
Investor Relations Department
Phone: 86-411-39185985
Email: ir@cbak.com.cn
The Blueshirt Group
Ms. Feifei Shen
Phone: +86 13466566136
Email: feifei@blueshirtgroup.com
The Blueshirt Group
Ms. Suwen Feng
Phone: +86 13917110134
Email: suwen@blueshirtgroup.com
In the United States:
The Blueshirt Group
Ms. Julia Qian
Phone: +1 973-619-3227
Email: Julia@blueshirtgroup.com
CBAK Energy Technology, Inc. and Subsidiaries | |||||||||
Unaudited Condensed Consolidated Balance Sheets | |||||||||
(In $ except for number of shares) | |||||||||
December 31, | September 30, | ||||||||
2020 | 2021 | ||||||||
Assets | |||||||||
Current assets | |||||||||
Cash and cash equivalents | $ | 11,681,750 | $ | 1,993,531 | |||||
Pledged deposits | 8,989,748 | 15,552,996 | |||||||
Trade accounts and bills receivable, net | 29,571,274 | 22,231,442 | |||||||
Inventories | 5,252,845 | 9,249,455 | |||||||
Prepayments and other receivables | 7,439,544 | 9,715,578 | |||||||
Investment in sales-type lease, net | 235,245 | 838,649 | |||||||
Total current assets | 63,170,406 | 59,581,651 | |||||||
Property, plant and equipment, net | 41,040,370 | 42,050,589 | |||||||
Construction in progress | 30,193,309 | 49,246,115 | |||||||
Non-marketable equity securities | - | 702,807 | |||||||
Deposit paid for acquisition of a subsidiary | - | 8,349,118 | |||||||
Loan to unrelated third party - Hitrans | - | 20,326,775 | |||||||
Operating lease right-of-use assets, net | - | 1,981,422 | |||||||
Prepaid land use right- non current | 7,500,780 | 7,465,426 | |||||||
Intangible assets, net | 11,807 | 21,418 | |||||||
Investment in sales-type lease, net | 850,407 | 980,731 | |||||||
Total assets | $ | 142,767,079 | $ | 190,706,052 | |||||
Liabilities | |||||||||
Current liabilities | |||||||||
Trade accounts and bills payable | $ | 28,352,292 | $ | 21,050,320 | |||||
Current maturities of long-term bank loans | 13,739,546 | - | |||||||
Other short-term loans | 1,253,869 | 680,563 | |||||||
Accrued expenses and other payables | 11,645,459 | 15,796,594 | |||||||
Payables to former subsidiaries, net | 626,990 | 361,874 | |||||||
Deferred government grants, current | 151,476 | 153,402 | |||||||
Product warranty provisions | 155,888 | 124,670 | |||||||
Operating lease liability, current | - | 753,404 | |||||||
Warrants liability | 17,783,000 | 10,474,000 | |||||||
Total current liabilities | 73,708,520 | 49,394,827 | |||||||
Deferred government grants, non-current | 7,304,832 | 8,833,848 | |||||||
Operating lease liability | - | 801,266 | |||||||
Product warranty provision | 1,835,717 | 1,873,626 | |||||||
Long term tax payable | 7,511,182 | 7,606,677 | |||||||
Total liabilities | 90,360,251 | 68,510,244 | |||||||
Commitments and contingencies | |||||||||
Shareholders' equity | |||||||||
Common stock | 79,310 | 88,555 | |||||||
Donated shares | 14,101,689 | 14,101,689 | |||||||
Additional paid-in capital | 225,278,113 | 241,232,244 | |||||||
Statutory reserves | 1,230,511 | 1,230,511 | |||||||
Accumulated deficit | (183,984,311) | (131,654,694) | |||||||
Accumulated other comprehensive loss | (239,609) | 1,240,354 | |||||||
56,465,703 | 126,238,659 | ||||||||
Less: Treasury shares | (4,066,610) | (4,066,610) | |||||||
Total shareholders' equities | 52,399,093 | 122,172,049 | |||||||
Non-controlling interests | 7,735 | 23,759 | |||||||
Total of equities | 52,406,828 | 122,195,808 | |||||||
Total liabilities and shareholders' equity | $ | 142,767,079 | $ | 190,706,052 |
CBAK Energy Technology, Inc. and Subsidiaries | |||||||||||||||||
Unaudited Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) | |||||||||||||||||
(In $ except for number of shares) | |||||||||||||||||
Three months ended | Nine months ended | ||||||||||||||||
2020 | 2021 | 2020 | 2021 | ||||||||||||||
Net revenues | $ | 10,620,656 | $ | 9,562,190 | $ | 22,146,177 | $ | 24,867,393 | |||||||||
Cost of revenues | (9,245,811) | (8,430,808) | (20,477,719) | (20,798,931) | |||||||||||||
Gross profit | 1,374,845 | 1,131,382 | 1,668,458 | 4,068,462 | |||||||||||||
Operating expenses: | |||||||||||||||||
Research and development expenses | (446,162) | (1,815,756) | (1,130,316) | (3,344,817) | |||||||||||||
Sales and marketing expenses | (157,485) | (510,386) | (351,963) | (1,262,999) | |||||||||||||
General and administrative expenses | (741,785) | (2,158,183) | (2,614,349) | (5,823,560) | |||||||||||||
Recovery of (provision for) doubtful accounts | 364,168 | 178,897 | (63,534) | 437,475 | |||||||||||||
Total operating expenses | (981,264) | (4,305,428) | (4,160,162) | (9,993,901) | |||||||||||||
Operating profit (loss) | 393,581 | (3,174,046) | (2,491,704) | (5,925,439) | |||||||||||||
Finance (expenses) income, net | (357,739) | 129,340 | (1,171,030) | 174,442 | |||||||||||||
Other income, net | 5,873 | 69,970 | 152,171 | 1,619,194 | |||||||||||||
Impairment of non-marketable equity securities | - | (43) | - | (690,585) | |||||||||||||
Change in fair value of warrants | - | 22,998,000 | - | 57,174,000 | |||||||||||||
Income (loss) before income tax and | 41,715 | 20,023,221 | (3,510,563) | 52,351,612 | |||||||||||||
Income tax expense | - | - | - | - | |||||||||||||
Net income (loss) | 41,715 | 20,023,221 | (3,510,563) | 52,351,612 | |||||||||||||
Less: Net income (loss) attributable to non- | 2,532 | (3,487) | (2,386) | (21,995) | |||||||||||||
Net income (loss) attributable to shareholders | $ | 44,247 | $ | 20,019,734 | $ | (3,512,949) | $ | 52,329,617 | |||||||||
Other comprehensive income (loss) | |||||||||||||||||
Net loss | 41,715 | 20,023,221 | (3,510,563) | 52,351,612 | |||||||||||||
– Foreign currency translation adjustment | 846,695 | 243,258 | 574,526 | 1,473,992 | |||||||||||||
Comprehensive income (loss) | 888,410 | 20,266,479 | (2,936,037) | 53,825,604 | |||||||||||||
Less: Comprehensive loss (income) | 3,465 | (3,404) | (630) | (16,024) | |||||||||||||
Comprehensive income (loss) attributable to | $ | 891,875 | $ | 20,263,075 | $ | (2,936,667) | $ | 53,809,580 | |||||||||
(Loss) Income per share | |||||||||||||||||
– Basic | $ | 0.00 | $ | 0.23 | $ | (0.06) | $ | 0.60 | |||||||||
– Diluted | $ | 0.00 | $ | 0.23 | $ | (0.06) | $ | 0.60 | |||||||||
Weighted average number of shares of | |||||||||||||||||
– Basic | 64,909,894 | 88,419,998 | 59,569,498 | 87,043,490 | |||||||||||||
– Diluted | 65,400,058 | 88,709,210 | 59,569,498 | 87,349,010 |
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SOURCE CBAK Energy Technology, Inc.
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