CBAK Energy(US:CBAT)2024-03-14 16:00Financial Performance - The company generated revenues of $204.4 million for the fiscal year ended December 31, 2023, a decrease of $44.3 million, or 18%, compared to $248.7 million for the fiscal year ended December 31, 2022[313][324]. - The net loss for the fiscal year ended December 31, 2023, was $8.5 million, an improvement of $2.8 million, or 25%, from a net loss of $11.3 million in the previous year[313][324]. - The company reported a gross profit of $31.7 million for the fiscal year ended December 31, 2023, representing a 75% increase from $18.1 million in 2022[324]. - The company recorded an operating loss of $7.3 million in 2023, a decrease of 37.0% from an operating loss of $11.5 million in 2022[337]. - The net loss for the year ended December 31, 2023, was $8.5 million, compared to a net loss of $11.3 million in 2022[339]. Revenue Breakdown - Revenue from residential energy supply and uninterruptible power supply products increased to $124.5 million in 2023, up $40.9 million, or 49%, from $83.6 million in 2022[313][324]. - Net revenue from sales of batteries for light electric vehicles decreased to $5.6 million in 2023, down $0.8 million, or 13%, from $6.4 million in 2022[313][326]. - Net revenues from sales of materials for lithium battery cell manufacturing dropped to $71.4 million in 2023, down from $154.0 million in 2022, due to a rapid decrease in raw material prices[330]. - Net revenues from sales of batteries for residential energy supply increased by 49% to $124.5 million in 2023, compared to $83.6 million in 2022[329]. Operating Expenses - The company incurred total operating expenses of $39.0 million in 2023, an increase of $9.4 million, or 32%, compared to $29.6 million in 2022[324]. - Research and development expenses rose to $11.9 million in 2023, an increase of 12.2% from $10.6 million in 2022[332]. - Sales and marketing expenses surged by 144.2% to $4.9 million in 2023, compared to $2.0 million in 2022[333]. - General and administrative expenses increased by 41.6% to $13.8 million in 2023, up from $9.7 million in 2022[334]. Cash Flow and Financing - As of December 31, 2023, the company had cash and cash equivalents of $58.8 million and a net working capital deficit of $32.1 million[340]. - Net cash provided by operating activities increased to $46.5 million for the year ended December 31, 2023, compared to $15.1 million in 2022, primarily due to a net income of $17.1 million[391][392]. - Net cash used in investing activities was $42.3 million in fiscal year 2023, compared to $7.9 million in 2022, with significant investments in property, plant, and equipment totaling $31.1 million[393]. - Net cash provided by financing activities increased to $18.6 million in 2023 from $5.6 million in 2022, primarily due to bank borrowings of $36.1 million[395]. Debt and Equity Transactions - The company entered into a one-year term facility with Jiangsu Gaochun Rural Commercial Bank for a maximum amount of RMB9 million (approximately $1.2 million) at an interest rate of 4.6% per annum[350]. - A short-term loan agreement with China CITIC Bank Shaoxing Branch was established for RMB10 million (approximately $1.4 million) at an interest rate of 4.35% per annum, with repayments totaling RMB10 million (approximately $1.4 million) made[351]. - The company has engaged in private placements and registered direct offerings, raising approximately $5.52 million from the issuance of 2,206,640 shares at $2.5 per share[360]. - The company entered into agreements to cancel debts in exchange for shares, including a total of 3,431,373 shares issued to Mr. Dawei Li and 1,666,667 shares to Mr. Yunfei Li at an exchange price of $1.02 per share[363]. - The company canceled a debt of approximately $11.17 million in exchange for 3,192,291 shares at an exchange price of $3.5 per share[383]. Future Plans and Investments - The company has invested in the development of the 32140 battery and plans to invest in R&D for Series 46 batteries to enhance competitiveness in the EV and LEV markets[313]. - The company plans to expand product lines and manufacturing capacity, requiring additional funding and potential equity financing[388]. - The company estimates total capital expenditures for fiscal year 2024 will reach approximately $30.0 million for new plants and production lines[399]. - Capital expenditures rose to $30.7 million in 2023 from $12.4 million in 2022, with a focus on constructing new facilities in Dalian, Nanjing, and Zhejiang[398]. Government Support and Subsidies - The company received government subsidies from local Chinese government agencies, which are presented as part of income unless earmarked for specific expenses[415]. - Government grants applicable to land are amortized over the life of the depreciable facilities constructed on it[416]. - The company defers recognition of unearned government subsidies until the criteria for recognition are met[415]. Currency and Fair Value - The exchange rate for balance sheet items, except for equity accounts, was 6.9091 RMB per U.S. dollar as of December 31, 2022, and increased to 7.0971 RMB per U.S. dollar by December 31, 2023[423]. - The fair value of warrants not indexed to the company's stock is recorded as a liability, with changes in estimated fair value recognized as non-cash gains or losses[419]. - The company uses the Black-Scholes Option Valuation Model to estimate the fair value of option awards, considering historical volatilities and U.S. Treasury yield curves[418].