NEW YORK, Nov. 15, 2010 (GLOBE NEWSWIRE) -- Advanced Battery Technologies, Inc. (Nasdaq:ABAT), a leading developer, manufacturer and distributor of rechargeable Polymer Lithium-Ion (PLI) batteries as well as a manufacturer of electric vehicles, today announced financial results for the third quarter ended September 30, 2010.
Third Quarter Financial Highlights
- Revenue increased 46.4% year-over-year to $ 25.9 million.
- Gross profit increased 80.4% year-over-year to $13.8 million.
- Net income increased 118.8% year-over-year to $11.1 million.
- Earnings per diluted share increased 92.5% year-over-year to $0.16.
- Strong balance sheet with $74.3 million in cash and cash equivalents as of September 30, 2010.
Mr. Zhiguo Fu, CEO of ABAT, stated, "We are pleased to report an increase in our revenue attributable to medium and large capacity batteries and electric vehicles. This has been beneficial to the profitability of our overall business. The margins that we are able to achieve in selling larger capacity batteries are significantly greater than the margins we achieve in selling smaller capacity batteries. In order to meet higher demand from both battery and electric scooter markets, the company intends to accelerate growth by both adding more facilities and pursuing acquisition opportunities."
Third Quarter 2010 Financial Results
The Company recorded total revenues of $25.9 million for the three months ended September 30, 2010, an increase of $8.2 million or 46.4% compared to $17.7 million for the three months ended September 30 2009. The increase in revenues was primarily due to the sales generated from the electric vehicle business, which the Company acquired on May 4, 2009. Sales of electric vehicles for the three months ended September 30, 2010 were $13.9 million, compared to $6.7million for the three months ended September 30, 2009.
In the three months ended September 30, 2010, our revenue increased by 46.4% and our cost of goods sold increased by 20.6%, from $10.1 million to $12.2 million, compared to the same period in 2009. Similarly, in the nine months ended September 30, 2010, our revenue increased by 62.0% and our cost of goods sold increased by 46.1%, from $23.2 million to $33.9 million, compared to the same period of 2009. This disparity in growth between revenue and cost of goods sold is mainly attributable to the higher average selling price of electric vehicles in 2010 than in 2009. In addition, since the acquisition of Wuxi ZQ in May 2009, we have worked aggressively to reduce unnecessary expenses at Wuxi ZQ. The overall result was an increase in our gross margin from 43.1% in the three months ended September 30 2009 to 53.1% in the same period of 2010. During the nine months ended September 30, 2010, our gross margin improved to 50.4% compared to 45.0% in the first nine months of 2009.
The Company's operating expenses decreased by 26.9%, from $2.4 million in the three months ended September 30, 2009 to $1.7 million in the same period of 2010. The Company incurred operating expenses of $6.3 million during the nine months ended September 30, 2010, an increase of $0.4 million or 6.8%, compared to $5.9 million for the nine months ended September 30, 2009. The increase is primarily due to our expanded battery and electric vehicle operations.
During the three and nine months ended September 30 2010, the changes in the fair value of outstanding warrants were $128,176 and ($5,269,104) respectively, which were recognized as other expense (income). As a result, in part, of that disparity, our net pre-tax income for the three months ended September 30, 2010, $12.0 million, was not significantly different from our operating income, $12.0 million, but our net pre-tax income for the nine months ended September 30, 2010, $33.6 million, was substantially greater than operating income for the period, $28.1 million.
At September 30, 2010 the Company had a strong balance sheet, with $74.3 million cash and cash equivalents. As of October 31, 2010 the Company had a backlog of approximately $55.4 million for delivery throughout the next 12 months, including a battery backlog of approximately $41.6 million.
About Advanced Battery Technologies, Inc.
Advanced Battery Technologies, Inc. (Nasdaq:ABAT), founded in September 2002, develops, manufactures and distributes rechargeable Polymer Lithium-Ion (PLI) batteries. The Company's products include rechargeable PLI batteries for electric automobiles, motorcycles, mine-use lamps, notebook computers, walkie-talkies and other electronic devices. ABAT's batteries combine high-energy chemistry with state-of-the-art polymer technology to overcome many of the shortcomings associated with other types of rechargeable batteries. Early in 2009, the Company acquired Wuxi Angell Autocycle Co. Ltd., an electric vehicle business, and renamed it Wuxi Zhongqiang Autocycle Co., Ltd. ("Wuxi ZQ"). The Company has a New York office, with its executive offices and manufacturing facilities in China.
Safe Harbor Statement
Certain statements in this release and other written or oral statements made by or on behalf of the Company are "forward-looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future are forward-looking statements within the meaning of these laws. The forward-looking statements are subject to a number of risks and uncertainties including market acceptance of the Company's services and projects and the Company's continued access to capital and other risks and uncertainties. The actual results the Company achieves may differ materially from those contemplated by any forward-looking statements due to such risks and uncertainties. These statements are based on our current expectations and speak only as of the date of such statements.
| ADVANCED BATTERY TECHNOLOGIES, INC. AND SUBSIDIARIES | ||
| CONDENSED CONSOLIDATED BALANCE SHEETS | ||
| (UNAUDITED) | ||
| ASSETS | ||
| September 30, | December 31, | |
| 2010 | 2009 | |
| (Restated) | ||
| Current assets: | ||
| Cash and cash equivalents | $ 74,278,291 | $ 52,923,358 |
| Accounts receivable, net | 19,609,668 | 22,406,927 |
| Inventories, net | 7,957,039 | 3,680,098 |
| Loan receivable | 1,600,000 | 1,600,000 |
| Other receivables | 342,586 | 107,751 |
| Advance to suppliers,net | 5,921,007 | 7,940,129 |
| Total Current Assets | 109,708,591 | 88,658,263 |
| Property, plant and equipment, net | 55,836,516 | 47,248,600 |
| Other assets: | ||
| Investment in unconsolidated entity | 789,362 | 785,057 |
| Investment advance | 1,497,571 | 1,457,034 |
| Deposit for long-term assets | 2,130,952 | 2,860,882 |
| Intangible assets, net | 13,924,332 | 14,317,502 |
| Goodwill | 2,541,094 | 2,472,311 |
| Other assets | 44,361 | 26,705 |
| Total other assets | 20,927,672 | 21,919,491 |
| Total Assets | $ 186,472,778 | $ 157,826,354 |
| LIABILITIES AND STOCKHOLDERS' EQUITY | ||
| Current liabilities: | ||
| Short-term loan | $ -- | $2,916,071 |
| Accounts payable | 931,385 | 670,254 |
| Advance from Customers | 168,311 | 228,871 |
| Accrued expenses and other payables | 1,166,173 | 1,389,130 |
| Total Current Liabilities | 2,265,868 | 5,204,326 |
| Long term liabilities: | ||
| Deferred tax liability | 3,025,847 | 3,025,847 |
| Warrant liability | 11,952,230 | 17,221,335 |
| Total Liabilities | 17,243,946 | 25,451,508 |
| Commitments and contingencies | ||
| Stockholders' Equity | ||
| Preferred stock, $0.001 face value, 5,000,000 shares authorized; | -- | -- |
| 2 shares issued and 2 shares outstanding as of September 30, 2010 and December 31, 2009 | ||
| Common stock, $0.001 par value, 150,000,000 shares authorized; | 69,097 | 68,778 |
| 69,097,220 shares issued and 68,902,639 shares outstanding as of September 30, 2010 | ||
| and 68,778,112 shares issued and 68,583,531 shares outstanding as of December 31, 2009 | ||
| Additional paid-in-capital | 71,246,548 | 70,023,310 |
| Accumulated other comprehensive income | 9,964,555 | 5,496,334 |
| Retained earnings | 88,448,122 | 57,285,914 |
| Less: Cost of treasury stock (194,581 shares as of September 30,2010 and December 31, 2009 ) | (499,490) | (499,490) |
| Total Stockholders' Equity | 169,228,832 | 132,374,846 |
| Total Liabilities and Stockholders' Equity | $ 186,472,778 | $ 157,826,354 |
| ADVANCED BATTERY TECHNOLOGIES, INC. AND SUBSIDIARIES | ||||
| CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER COMPREHENSIVE INCOME | ||||
| (UNAUDITED) | ||||
|
For the Three Months ended September 30, |
For the Nine Months ended September 30, |
|||
| 2010 | 2009 | 2010 | 2009 | |
| (Restated) | (Restated) | |||
| Revenues | $ 25,930,885 | $ 17,714,278 | $ 68,315,260 | $ 42,171,598 |
| Cost of Goods Sold | 12,170,059 | 10,087,228 | 33,899,515 | 23,197,017 |
| Gross Profit | 13,760,826 | 7,627,050 | 34,415,745 | 18,974,580 |
| Operating Expenses | ||||
| Research & Development expenses | 194,420 | 118,764 | 194,420 | 307,236 |
| Selling, general and administrative | 1,546,734 | 2,264,173 | 6,155,513 | 5,636,527 |
| Operating income | 12,019,672 | 5,244,112 | 28,065,812 | 13,030,817 |
| Other Income (Expenses) | ||||
| Interest income | 110,276 | 76,841 | 297,612 | 247,387 |
| Interest (expense) | (7,659) | (120,417) | (47,452) | (326,636) |
| Equity gain (loss) from unconsolidated entity | 2,429 | 5,190 | 4,305 | (62,470) |
| Forgiveness of debt | -- | 336,849 | -- | 336,849 |
| Other income (expenses) | 33,412 | (160) | 33,412 | 13,548 |
| Gain on bargain purchase | -- | -- | -- | 8,645,276 |
| Change in fair value of warrants | (128,176) | 269,943 | 5,269,104 | (4,241,549) |
| Total other income (expenses) | 10,281 | 568,246 | 5,556,980 | 4,612,405 |
| Income before Income Taxes | 12,029,953 | 5,812,358 | 33,622,793 | 17,643,222 |
| Provision for Income Taxes | ||||
| Income tax-Current | 902,558 | 726,337 | 2,460,585 | 2,010,030 |
| Income tax-Deferred | -- | 0 | -- | 3,025,847 |
| Net income | $ 11,127,394 | $ 5,086,021 | $ 31,162,207 | $ 12,607,345 |
| Other Comprehensive Income | ||||
| Foreign currency translation adjustment | 3,237,432 | (28,402) | 4,468,221 | (57,938) |
| Comprehensive Income | $ 14,364,825 | $ 5,057,619 | $ 35,630,429 | $ 12,549,407 |
| Earnings per share | ||||
| Basic | $ 0.18 | $ 0.10 | $ 0.51 | $ 0.25 |
| Diluted | $ 0.16 | $ 0.08 | $ 0.45 | $ 0.22 |
| Weighted average number of common shares outstanding | ||||
| Basic | 62,587,469 | 52,970,305 | 61,558,821 | 49,676,366 |
| Diluted | 69,723,408 | 61,342,040 | 68,694,759 | 57,974,862 |
| ADVANCED BATTERY TECHNOLOGIES, INC. AND SUBSIDIARIES | ||
| CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS | ||
| (UNAUDITED) | ||
| For the Nine Months ended September 30, | ||
| 2010 | 2009 | |
| (Restated) | ||
| Cash Flows From Operating Activities: | ||
| Net income | $ 31,162,207 | $ 12,607,345 |
| Adjustments to reconcile net income to net cash | ||
| provided by operating activities: | ||
| Gain on bargain purchase | -- | (8,645,276) |
| Deferred income tax | -- | 3,025,847 |
| Depreciation and amortization | 3,024,982 | 1,763,076 |
| Amortization of deferred consulting expenses | 87,281 | 108,468 |
| Amortization of stock based compensation expense | 1,136,276 | 1,346,769 |
| Equity loss (gain) of unconsolidated entity | (4,305) | 62,470 |
| Provision for doubtful accounts and inventory valuation allowance | 638,000 | 982,866 |
| Forgiveness of debt | -- | (336,849) |
| Gain on disposal of fixed asset | (146) | -- |
| Change in fair value of warrants | (5,269,104) | 4,241,549 |
| Changes in operating assets and liabilities: | ||
| Accounts receivable | 2,805,618 | (6,880,935) |
| Inventories | (4,092,945) | (2,712,891) |
| Other receivable & prepayments | 2,509,083 | (4,299,473) |
| Accounts payable, accrued expenses and other payables | (103,861) | (6,376,234) |
| Advances from Customer | (65,649) | (872,575) |
| Net cash provided by (used in) operating activities | 31,827,437 | (5,985,843) |
| Cash Flows From Investing Activities: | ||
| Deposit for long-term assets | (1,061,467) | (1,360,130) |
| Purchase of property, plant and equipment | (8,129,996) | 710,261 |
| Cash acquired from business combination | -- | 837,564 |
| Acquistion of Construction in process | -- | (9,003,299) |
| Net cash used in investing activities | (9,186,321) | (8,815,605) |
| Cash Flows From Financing Activities | ||
| Repayment of bank loan | (2,937,943) | -- |
| Purchase of treasury stock | -- | (203,788) |
| Proceeds from equity financing, net | -- | 16,091,868 |
| Repayment of officer loan | -- | (13,143) |
| Net cash provided by (used in) financing activities | (2,937,943) | 15,874,937 |
| Effect of exchange rate changes on cash and cash equivalents | 1,651,761 | 20,013 |
| Increase in cash and cash equivalents | 21,354,934 | 1,093,502 |
| Cash and Cash Equivalents - Beginning of period | 52,923,358 | 32,746,155 |
| Cash and Cash Equivalents - End of period | $ 74,278,291 | $ 33,839,657 |
| SUPPLEMENTAL CASH FLOW INFORMATION: | ||
| During the year, cash was paid for the following: | ||
| Interest expense | $ 47,452 | $ 277,895 |
| Income taxes | $ 2,416,310 | $ 1,083,556 |
| NON-CASH INVESTING AND FINANCING ACTIVITIES: | ||
| Common stock issued for stock-based compensation | $ 1,132,795 | $ 1,119,650 |
| Common stock issued for acquisition of Wuxi ZQ | $ -- | $ 9,870,000 |
| Options issued to executives for service | $ -- | $ 777,660 |