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What changed in CBAK Energy Technology, Inc.'s 10-K — 2023 vs 2024

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Paragraph-level year-over-year comparison of CBAK Energy Technology, Inc.'s 2023 and 2024 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2024 report.

+212 added−231 removedSource: 10-K (2025-03-17) vs 10-K (2024-03-15)

Top changes in CBAK Energy Technology, Inc.'s 2024 10-K

212 paragraphs added · 231 removed · 173 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

78 edited+21 added−25 removed104 unchanged
Biggest change(All amounts, other than percentages, in thousands of U.S. dollars) Year Ended December 31, Change 2022 2023 $ % Net revenues $ 248,725 $ 204,438 (44,287 ) -18 % Cost of revenues (230,630 ) (172,714 ) 57,916 -25 % Gross profit 18,095 31,724 13,629 75 % Operating expenses: Research and development expenses (10,635 ) (11,928 ) (1,293 ) 12 % Sales and marketing expenses (2,008 ) (4,904 ) (2,896 ) 144 % General and administrative expenses (9,738 ) (13,789 ) (4,051 ) 42 % Impairment charge on property, plant and equipment (4,832 ) (7,070 ) (2,238 ) 46 % Impairment charge on goodwill (1,556 ) - 1,556 -100 % Provision of expected credit losses (831 ) (1,285 ) (454 ) 55 % Total operating expenses (29,600 ) (38,976 ) (9,376 ) 32 % Operating loss (11,505 ) (7,252 ) 4,253 -37 % Finance income, net 491 433 (58 ) -12 % Impairment charges on equity investee - (2,366 ) (2,366 ) n/a Share of loss of equity investee - (27 ) (27 ) n/a Other expense, net (7,252 ) 3,023 10,275 -142 % Change in fair value of warrants liability 5,710 136 (5,574 ) -98 % Loss before income tax (12,556 ) (6,053 ) 6,503 -52 % Income tax credit (expense) 1,228 (2,486 ) (3,714 ) -302 % Net loss (11,328 ) (8,539 ) 2,789 -25 % Less: Net loss attributable to non-controlling interests 1,879 6,090 4,211 224 % Net loss attributable to shareholders of CBAK Energy Technology, Inc. $ (9,449 ) (2,449 ) 7,000 -74 % Net revenues .
Biggest change(All amounts, other than percentages, in thousands of U.S. dollars) Year Ended December 31, Change 2023 2024 $ % Net revenues $ 204,438 $ 176,615 -27,823 -14 % Cost of revenues (172,714 ) (134,839 ) 37,875 -22 % Gross profit 31,724 41,776 10,052 32 % Operating expenses: Research and development expenses (11,928 ) (13,010 ) -1,082 9 % Sales and marketing expenses (4,904 ) (5,198 ) -294 6 % General and administrative expenses (13,789 ) (13,948 ) -159 1 % Impairment charge on property, plant and equipment (7,070 ) (475 ) 6,595 -93 % Provision of expected credit losses (1,285 ) (356 ) 929 -72 % Total operating expenses (38,976 ) (32,987 ) 5,989 -15 % Operating (loss) income (7,252 ) 8,789 16,041 -221 % Finance income, net 433 1,283 850 196 % Impairment charges on equity investee (2,366 ) - 2,366 -100 % Share of loss of equity investee (27 ) (19 ) 8 -30 % Gain on disposal of equity investee - 45 45 n/a Other income, net 3,023 1,046 -1,977 -65 % Change in fair value of warrants liability 136 - -136 -100 % (Loss) income before income tax (6,053 ) 11,144 17,197 -284 % Income tax expense (2,486 ) (1,559 ) 927 -37 % Net (loss) income (8,539 ) 9,585 18,124 -212 % Less: Net loss attributable to non-controlling interests 6,090 2,205 -3,885 -64 % Net (loss) income attributable to shareholders of CBAK Energy Technology, Inc. $ (2,449 ) 11,790 14,239 -581 % Net revenues .
Revenues from product sales are recognized when the customer obtains control of our product, which occurs at a point in time, typically upon delivery to the customer.
Revenues from product sales are recognized when the customer obtains control of our product, which occurs at a point in time, typically upon delivery to the customer.
The net cash provided by operating activities in 2023 was mainly attributable to our net income of $17.1 million (before loss on disposal of property, plant and equipment, impairment charge of long-lived assets, impairment loss of equity investee and excluding non-cash depreciation and amortization, write-down of inventories, share-based compensation and changes in fair value of warrants liability), increase of trade and bills payable by $16.8 million, a decrease of inventories of $11.2 million, a decrease of trade receivable from Shenzhen BAK Battery Co., Ltd.
The net cash provided by operating activities was mainly attributable to our net income of $17.1 million (before loss on disposal of property, plant and equipment, impairment charge of long-lived assets, impairment loss of equity investee and excluding non-cash depreciation and amortization, write-down of inventories, share-based compensation and changes in fair value of warrants liability), increase of trade and bills payable by $16.8 million, a decrease of inventories of $11.2 million, a decrease of trade receivable from Shenzhen BAK Battery Co., Ltd.
On January 17, 2022, we obtained a one-year term facility from Agricultural Bank of China with a maximum amount of RMB10 million (approximately $1.4 million) bearing interest at 105% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 3.85% per annum. The facility was guaranteed by our CEO, Mr. Yunfei Li and Mr.
On January 17, 2022, we obtained a one-year term facility from Agricultural Bank of China with a maximum amount of RMB10 million (approximately $1.4 million) bearing interest at 105% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 3.85% per annum. The facility was guaranteed by our former CEO, Mr. Yunfei Li and Mr.
On January 7, 2023, we obtained a two-year term facility from Postal Savings Bank of China, Nanjing Gaochun Branch with a maximum amount of RMB10 million (approximately $1.4 million) for a period from January 7, 2023 to January 6, 2025. The facility was guaranteed by our CEO, Mr. Yunfei Li, Mr. Yunfei Li’s wife Ms.
On January 7, 2023, we obtained a two-year term facility from Postal Savings Bank of China, Nanjing Gaochun Branch with a maximum amount of RMB10 million (approximately $1.4 million) for a period from January 7, 2023 to January 6, 2025. The facility was guaranteed by our former CEO, Mr. Yunfei Li, Mr. Yunfei Li’s wife Ms.
On January 6, 2023, we borrowed a one-year term loan of RMB10 million (approximately $1.4 million) for a period of one year to January 4, 2024, bearing interest at 120% of benchmark rate of the PBOC for short-term loans, which is 3.85% per annum, while other terms and guarantee remain the same.
On January 6, 2023, we borrowed a one-year term loan of RMB10 million (approximately $1.4 million) for a period of one year to January 4, 2024, bearing interest at 120% of benchmark rate of the PBOC for short-term loans, which is 3.85% per annum, while other terms and guarantee remain the same. We repaid the loan on January 4, 2024.
On June 27, 2023, we entered into another loan agreement for one year from June 27, 2023 to June 26, 2024 under the two-year term facility for a maximum loan amount of RMB10 million (approximately $1.4 million) bearing interest rate at 3.65 % pr annum. The Company borrowed RMB10 million (approximately $1.4 million) on the same date.
On June 27, 2023, we entered into another loan agreement for one year from June 27, 2023 to June 26, 2024 under the two-year term facility for a maximum loan amount of RMB10 million (approximately $1.4 million) bearing interest rate at 3.65 % pr annum. We borrowed RMB10 million (approximately $1.4 million) on the same date.
The facility was guaranteed by our CEO, Mr, Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. Under the facility, we borrowed RMB10 million (approximately $1.4 million) on July 31, 2023, bearing interest rate at 3.15% per annum.
The facility was guaranteed by our former CEO, Mr, Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. Under the facility, we borrowed RMB10 million (approximately $1.4 million) on July 31, 2023, bearing interest rate at 3.15% per annum.
On July 8, 2020, we entered into certain exchange agreement with the Lender, pursuant to which the Company and the Lender agreed to (i) partition a new promissory note in the original principal amount equal to $250,000 from the outstanding balance of certain promissory note that the Company issued to the Lender on December 30, 2019, which has an original principal amount of $1,670,000, and (ii) exchange the partitioned promissory note for the issuance of 453,161 shares of the Company’s common stock, par value $0.001 per share to the Lender. 50 On July 29, 2020, we entered into a seventh exchange agreement (the “Seventh Exchange Agreement”) with the Lender, pursuant to which the Company and the Lender agreed to (i) partition a new promissory note in the original principal amount equal to $365,000 from the outstanding balance of certain promissory note that the Company issued to the Lender on July 24, 2019, which has an original principal amount of $1,395,000, and (ii) exchange the partitioned promissory note for the issuance of 576,802 shares of the Company’s common stock, par value $0.001 per share to the Lender.
On July 8, 2020, we entered into certain exchange agreement with the Lender, pursuant to which the Company and the Lender agreed to (i) partition a new promissory note in the original principal amount equal to $250,000 from the outstanding balance of certain promissory note that the Company issued to the Lender on December 30, 2019, which has an original principal amount of $1,670,000, and (ii) exchange the partitioned promissory note for the issuance of 453,161 shares of the Company’s common stock, par value $0.001 per share to the Lender. 52 On July 29, 2020, we entered into a seventh exchange agreement (the “Seventh Exchange Agreement”) with the Lender, pursuant to which the Company and the Lender agreed to (i) partition a new promissory note in the original principal amount equal to $365,000 from the outstanding balance of certain promissory note that the Company issued to the Lender on July 24, 2019, which has an original principal amount of $1,395,000, and (ii) exchange the partitioned promissory note for the issuance of 576,802 shares of the Company’s common stock, par value $0.001 per share to the Lender.
We repaid the loan on September 24, 2023. 46 We entered into another one-year term facility with Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB9 million (approximately $1.2 million) bearing interest rate at 4.6% per annum for a period from September 27, 2023 to August 31, 2024.
We repaid the loan on September 24, 2023. 48 We entered into another one-year term facility with Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB9 million (approximately $1.2 million) bearing interest rate at 4.6% per annum for a period from September 27, 2023 to August 31, 2024.
Upon receipt of the shares, the creditors released the Company from any claims, demands and other obligations relating to the Sixth Debt. 49 On July 24, 2019, we entered into a securities purchase agreement with Atlas Sciences, LLC (the “Lender”), pursuant to which we issued a promissory note (the “Note I”) to the Lender.
Upon receipt of the shares, the creditors released the Company from any claims, demands and other obligations relating to the Sixth Debt. 51 On July 24, 2019, we entered into a securities purchase agreement with Atlas Sciences, LLC (the “Lender”), pursuant to which we issued a promissory note (the “Note I”) to the Lender.
The portion of the warranty reserve expected to be incurred within the next 12 months is included within accrued liabilities and other while the remaining balance is included within other long-term liabilities on the consolidated balance sheets. 55 Government Grants Our subsidiaries in China receive government subsidies from local Chinese government agencies in accordance with relevant Chinese government policies.
The portion of the warranty reserve expected to be incurred within the next 12 months is included within accrued liabilities and other while the remaining balance is included within other long-term liabilities on the consolidated balance sheets. 57 Government Grants Our subsidiaries in China receive government subsidies from local Chinese government agencies in accordance with relevant Chinese government policies.
Lending from Financial Institutions On November 16, 2021, we obtained banking facilities from Shaoxing Branch of Bank of Communications Co., Ltd with a maximum amount of RMB120.1 million (approximately $16.6 million) with the term from November 18, 2021 to November 18, 2026. The facility was secured by our land use rights and buildings.
Lending from Financial Institutions On November 16, 2021, we obtained banking facilities from Shaoxing Branch of Bank of Communications Co., Ltd with a maximum amount of RMB120.1 million (approximately $16.6 million) with the term from November 18, 2021 to November 18, 2026. The facility was secured by the Company’s land use rights and buildings.
On March 29, 2023, we and Bank of China Limited entered into a short-term loan agreement for one year from March 29, 2023 to March 28, 2024 for a maximum loan amount to RMB5 million (approximately $0.7 million) bearing interest rate at 3.65% per annum. Weborrowed RMB5 million (approximately $0.7 million) on the same date.
On March 29, 2023, we and Bank of China Limited entered into a short-term loan agreement for one year from March 29, 2023 to March 28, 2024 for a maximum loan amount to RMB5 million (approximately $0.7 million) bearing interest rate at 3.65% per annum. We borrowed RMB5 million (approximately $0.7 million) on the same date.
If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. 54 Trade and Bills Receivable and current expected credit losses Trade and bills receivable are recorded at the invoiced amount, net of allowances for doubtful accounts and sales returns.
If the carrying amount of an asset exceeds its estimated undiscounted future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. 56 Trade and Bills Receivable and current expected credit losses Trade and bills receivable are recorded at the invoiced amount, net of allowances for doubtful accounts and sales returns.
Equity and Debt Financings from Investors In addition, we have obtained funds through private placements, registered direct offerings and other equity and debt financings in the past: On July 28, 2016, the Company entered into securities purchase agreements with Mr. Jiping Zhou and Mr.
Equity and Debt Financings from Investors We have also obtained funds through private placements, registered direct offerings and other equity and debt financings in the past: On July 28, 2016, the Company entered into securities purchase agreements with Mr. Jiping Zhou and Mr.
In 2019, according to the securities purchase agreement and agreed by the investors, we returned partial earnest money of $966,579 (approximately RMB6.7 million) to these investors. 48 On January 7, 2019, each of Mr. Dawei Li and Mr.
In 2019, according to the securities purchase agreement and agreed by the investors, we returned partial earnest money of $966,579 (approximately RMB6.7 million) to these investors. 50 On January 7, 2019, each of Mr. Dawei Li and Mr.
Such funds will be used to construct new plants with new production lines and battery module packing lines. 53 Critical Accounting Policies and Estimates Our consolidated financial information has been prepared in accordance with U.S.
Such funds will be used to construct new plants with new production lines and battery module packing lines. 55 Critical Accounting Policies and Estimates Our consolidated financial information has been prepared in accordance with U.S.
We entered into another loan agreement with China CITIC Bank Shaoxing Branch for a short-term loan of RMB4.8 million (approximately $0.7 million) from August 10, 2023 to May 2, 2024, bearing interest rate at 4.3% per annum.
We entered into another loan agreement with China CITIC Bank Shaoxing Branch for a short-term loan of RMB4.8 million (approximately $0.7 million) from August 10, 2023 to May 2, 2024, bearing interest rate at 4.3% per annum. We repaid the loan on May 2, 2024.
Our capital expenditures in 2023 were primarily allocated to the construction of our Dalian, Nanjing and Zhejiang facilities. The table below sets forth the breakdown of our capital expenditures by use for the periods indicated.
Our capital expenditures in 2024 were primarily allocated to the construction of our Dalian, Nanjing and Zhejiang facilities. The table below sets forth the breakdown of our capital expenditures by use for the periods indicated.
The net cash provided by financing activities for the year ended December 31, 2023 mainly comprised $36.1 million bank borrowings, and $1.7 million from finance leases, partially offset by repayment of bank borrowings of $18.0 million and $0.9 million repayment on finance lease. Net cash provided by financing activities was $5.6 million in the fiscal year ended December 31, 2022.
Net cash provided by financing activities was $18.6 million in the fiscal year ended December 31, 2023. The net cash provided by financing activities mainly comprised $36.1 million bank borrowings, and $1.7 million from finance leases, partially offset by repayment of bank borrowings of $18.0 million and $0.9 million repayment on finance lease.
We has repaid RMB5 million (approximately $0.7 million), RMB0.2 million (approximately $0.1 million) and RMB4.8, million (approximately $0.7 million) on November 16, 2022, December 27, 2022 and August 9, 2023, respectively.
We have repaid RMB5 million (approximately $0.7 million), RMB0.2 million (approximately $0.1 million) and RMB4.8, million (approximately $0.7 million) on November 16, 2022, December 27, 2022 and August 9, 2023, respectively.
The facility was guaranteed by 100% equity in CBAK Nanjing held by BAK Investment and the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB9 million (approximately $1.3 million) on September 27, 2023 for a term until September August 31, 2024.
The facility was guaranteed by 100% equity in CBAK Nanjing held by BAK Investment and our former CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB9 million (approximately $1.3 million ) on September 27, 2023 for a term until August 31, 2024. We repaid the loan on August 31, 2024.
On February 9, 2022, we obtained a one-year term facility from Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB10 million (approximately $1.4 million) bearing interest at 124% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 4.94% per annum. The facility was guaranteed by our CEO, Mr. Yunfei Li and Mr.
On February 9, 2022, we obtained a one-year term facility from Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB10 million (approximately $1.4 million) bearing interest at 124% of benchmark rate of the People’s Bank of China (“PBOC”) for short-term loans, which is 4.94% per annum. The facility was guaranteed by the Company’s former CEO, Mr.
Net revenues from sales of materials for use in manufacturing of lithium battery cells were $71.4 million for the fiscal year ended December 31, 2023, as compared to $154.0 million for 2022. This primarily resulted from a rapid decrease in raw material prices during 2023, which led to significant downward pressure on the pricing of our battery material products.
Net revenues from sales of materials for use in manufacturing of lithium battery cells were $40.0 million for the fiscal year ended December 31, 2024, as compared to $71.4 million for 2023. This primarily resulted from a rapid decrease in raw material prices since 2023, which led to significant downward pressure on the pricing of our battery material products.
Provision for expected credit losses was $1.3 million for the year ended December 31, 2023, as compared to $0.8 million for 2022. We determine the allowance based on historical write-off experience, customer specific facts and economic conditions. Operating loss.
Provision for expected credit losses was $0.4 million for the year ended December 31, 2024, as compared to $1.3 million for 2023. We determine the allowance based on historical write-off experience, customer specific facts and economic conditions. Operating income (loss).
However, because we did not have any assessable income derived from or arising in Hong Kong, BAK Asia, BAK Investment and Nacell Holdings had not paid any such tax. 42 Results of Operations Comparison of Years Ended December 31, 2022 and 2023 The following table sets forth key components of our results of operations for the years indicated, both in dollars and as a percentage of our revenue.
However, because we did not have any assessable income derived from or arising in Hong Kong, BAK Asia, BAK Investment and Hong Kong Hitrans had not paid any such tax. 45 Results of Operations Comparison of Years Ended December 31, 2023 and 2024 The following table sets forth key components of our results of operations for the years indicated, both in dollars and as a percentage of our revenue.
As of August 31, 2021, we had not received any notices from investors to exercise the Series B warrants, which, along with the Series A-2 warrants, had expired.
As of August 31, 2021, we had not received any notices from investors to exercise the Series B warrants, which, along with the Series A-2 warrants, had expired. As of December 31, 2023, we had not received any notices from investors to exercise the 2020 Warrants, which had also expired.
The impairment charge represented the excess of carrying amounts of our long-lived assets over the estimated fair value of the Company’s production facilities in Hitrans for the production of materials used in manufacturing of lithium batteries, due to underperformance of Hitrans reporting unit. No impairment charge on production facilities in Dalian and Nanjing. Goodwill impairment charge.
The impairment charge represented the excess of carrying amounts of our long-lived assets over the estimated fair value of the Company’s production facilities in Hitrans for the production of materials used in manufacturing of lithium batteries, due to underperformance of Hitrans reporting unit. No impairment charge on production facilities in Dalian, Nanjing and Shangqiu. Provision for expected credit losses.
Investing Activities Net cash used in investing activities was $42.3 million in the fiscal year ended December 31, 2023. The net cash used in investing activities comprised the purchases of property, plant and equipment and construction in progress $31.1 million, $4.0 million on investment in equity method investment and $7.1 million on deposit paid for acquisition of long-term investments.
The net cash used in investing activities comprised the purchases of property, plant and equipment and construction in progress $31.1 million, $4.0 million on investment in equity method investment and $7.1 million on deposit paid for acquisition of long-term investments. 54 Financing Activities Net cash used in financing activities was $11.7 million in the fiscal year ended December 31, 2024.
During the course of our strategic review of our operations, we assessed the recoverability of the carrying value of our long-lived assets which resulted in impairment losses of $7.1 million and $4.8 million for the years ended December 31, 2023 and 2022, respectively.
During the course of our strategic review of our operations, we assessed the recoverability of the carrying value of our long-lived assets which resulted in impairment losses of $0.5 million and $7.1 million for the years ended December 31, 2024 and 2023, respectively.
Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB10 million (approximately $1.4 million) on February 17, 2022 for a term until January 28, 2023. The Company repaid RMB10 million (approximately $1.4 million) on January 16, 2023.
Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB10 million (approximately $1.4 million) on February 17, 2022 for a term until January 28, 2023. We repaid RMB10 million (approximately $1.4 million) on January 16, 2023.
On August 3, 2023, we and Bank of China entered into a short term loan agreement for one year from August 3, 2023 to August 2, 2024 for a maximum amount of RMB10 million (approximately $1.4 million) bearing interest rate at 3.55% per annum. We borrowed RMB10 million (approximately $1.4 million) on September 27, 2023.
The Company repaid the loan on July 22, 2024 On August 3, 2023, we and Bank of China entered into a short term loan agreement for one year from August 3, 2023 to August 2, 2024 for a maximum amount of RMB10 million (approximately $1.4 million) bearing interest rate at 3.55% per annum.
Gross profit margin significantly increased largely due to our ability to sell our battery products at a relatively higher price to certain customers. Research and development expenses. Research and development expenses increased to $11.9 million for the year ended December 31, 2023, as compared to $10.6 million for 2022, an increase of $1.3 million, or 12.2%.
Gross profit margin significantly increased largely due to our ability to sell our battery products at a relatively higher price to certain customers. Research and development expenses . Research and development expenses increased to $13.0 million for the year ended December 31, 2024, as compared to $11.9 million for 2023, an increase of $1.1 million, or 9%.
Sales and marketing expenses increased to $4.9 million for the year ended December 31, 2023, as compared to $2.0 million for 2022, an increase of $2.9 million, or 144.2%. As a percentage of revenues, sales and marketing expenses were 2.4% and 0.8% of revenues for the years ended December 31, 2023 and 2022, respectively.
Sales and marketing expenses increased to $5.2 million for the year ended December 31, 2024, as compared to $4.9 million for 2023, an increase of $0.3 million, or 6%. As a percentage of revenues, sales and marketing expenses were 2.9% and 2.4% of revenues for the years ended December 31, 2024 and 2023, respectively.
Changes in fair value of warrants liability. We issued warrants in the financings we consummated in December 2020 and February 2021, respectively. We determined that these warrants should be accounted for as derivative liabilities, as the warrants are dominated in a currency (U.S. dollar) other than our functional currency.
We issued warrants in the financings we consummated in December 2020 and February 2021, respectively. We determined that these warrants should be accounted for as derivative liabilities, as the warrants are dominated in a currency (U.S. dollar) other than our functional currency. The change in fair value of warrants liability is mainly due to our share price decline.
The loan was secured by our buildings in Dalian. On April 19, 2023, we and Bank of Nanjing Gaochun Branch entered into a short-term loan agreement for one year from April 10, 2023 to April 9, 2024 for RMB10 million (approximately $1.4 million) bearing interest rate at 3.7% per annum.
On April 19, 2023, we and Bank of Nanjing Gaochun Branch entered into a short-term loan agreement for one year from April 10, 2023 to April 9, 2024 for RMB10 million (approximately $1.4 million) bearing interest rate at 3.7% per annum. We borrowed RMB10 million (approximately $1.4 million) on April 23, 2023.
(All amounts in thousands of U.S. dollars) Year Ended December 31, December 31, 2022 2023 Purchase of property, plant and equipment and construction in progress $ 12,373 $ 31,141 We estimate that our total capital expenditures in fiscal year 2024 will reach approximately $30.0 million.
(All amounts in thousands of U.S. dollars) Year Ended December 31, December 31, 2023 2024 Purchase of property, plant and equipment and construction in progress $ 31,141 $ 17,187 We estimate that our total capital expenditures in fiscal year 2025 will reach approximately $50 million.
The loan was guaranteed by our CEO, Mr. Yunfei Li, Mr. Yunfei Li’s wife Ms. Qinghui Yuan and CBAK New Energy (Nanjing) Co., Ltd.
The loan was guaranteed by our former CEO, Mr. Yunfei Li, Mr. Yunfei Li’s wife Ms. Qinghui Yuan and CBAK New Energy (Nanjing) Co., Ltd. We repaid the loan on June 26, 2024.
The following table sets forth a summary of our cash flows for the periods indicated: (All amounts in thousands of U.S. dollars) Year Ended December 31, December 31, 2022 2023 Net cash provided by operating activities $ 15,115 $ 46,507 Net cash used in investing activities (7,928 ) (42,310 ) Net cash provided by financing activities 5,611 18,615 Effect of exchange rate changes on cash and cash equivalents and restricted cash (1,797 ) (1,345 ) Net increase in cash and cash equivalents and restricted cash 11,001 21,467 Cash and cash equivalents and restricted cash at the beginning of the year 26,355 37,356 Cash and cash equivalents and restricted cash at the end of the year $ 37,356 $ 58,823 Operating Activities Net cash provided by operating activities was $46.5 million in the year ended December 31, 2023.
The following table sets forth a summary of our cash flows for the periods indicated: (All amounts in thousands of U.S. dollars) Year Ended December 31, December 31, 2023 2024 Net cash provided by operating activities $ 46,507 $ 39,704 Net cash used in investing activities (42,310 ) (23,432 ) Net cash provided by (used in) financing activities 18,615 (11,686 ) Effect of exchange rate changes on cash and cash equivalents and restricted cash (1,345 ) (2,623 ) Net increase in cash and cash equivalents and restricted cash 21,467 1,963 Cash and cash equivalents and restricted cash at the beginning of the year 37,356 58,823 Cash and cash equivalents and restricted cash at the end of the year $ 58,823 $ 60,786 Operating Activities Net cash provided by operating activities was $39.7 million for the year ended December 31, 2024.
Net revenues from sales of batteries for residential energy supply & uninterruptable supplies was $124.5 million for the fiscal year ended December 31, 2023, as compared to $83.6 million for fiscal year ended December 31, 2022, an increase of $40.9 million, or 49%.
Net revenues from sales of batteries for residential energy supply & uninterruptable supplies was $124.6 million for the fiscal year ended December 31, 2024, as compared to $124.5 million for fiscal year ended December 31, 2023.
On April 20, 2023, we borrowed another one-year loan of RMB10 million (approximately $1.4 million) bearing interest at 102.5% of benchmark rate of PBOC for short-term loans, which is 3.90% per annum for a term until April 19, 2024. On June 22, 2022, we obtained another one-year term facility from China Zheshang Bank Co., Ltd.
On April 20, 2023, we borrowed another one-year loan of RMB10 million (approximately $1.4 million) bearing interest at 102.5% of benchmark rate of PBOC for short-term loans, which is 3.90% per annum for a term until April 19, 2024. We repaid the loan on April 19, 2024.
This is assessed at each quarter based on the Company’s specific facts and circumstances. Outstanding accounts receivable balances are reviewed individually for collectability. Account balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Inventories Inventories are stated at the lower of cost or net realizable value.
Outstanding trade receivable balances are reviewed individually for collectability. Trade receivable balances are charged off against the allowance after all means of collection have been exhausted and the potential for recovery is considered remote. Inventories Inventories are stated at the lower of cost or net realizable value.
Gross profit for the year ended December 31, 2023 was $31.7 million, or 15.5% of net revenues as compared to gross profit of $18.1 million, or 7.3% of net revenues, for the fiscal year ended December 31, 2022.
Gross profit for the year ended December 31, 2024 was $41.8 million, or 24% of net revenues as compared to gross profit of $31.7 million, or 15.5% of net revenues, for the fiscal year ended December 31, 2023.
On January 17, 2023, we borrowed a one-year loan of RMB10 million (approximately $1.4 million) bearing interest at 129% of benchmark rate of PBOC for short-term loans, which is 4.70% per annum for a term until January 13, 2024. On March 8, 2022, we obtained a one-year term facility from China Zheshang Bank Co., Ltd.
On January 17, 2023, we borrowed a one-year loan of RMB10 million (approximately $1.4 million) bearing interest at 129% of benchmark rate of PBOC for short-term loans, which is 4.70% per annum for a term until January 13, 2024. We repaid the loan on January 13, 2024.
(“Shenzhen BAK”) of $5.4 million, offset by an increase of trade and bills receivable of $3.0 million. Net cash provided by operating activities was $15.1 million in the year ended December 31, 2022.
(“Shenzhen BAK”) of $5.4 million, offset by an increase of trade and bills receivable of $3.0 million. Investing Activities Net cash used in investing activities was $23.4 million in the fiscal year ended December 31, 2024.
Net revenues were $204.4 million for the fiscal year ended December 31, 2023, as compared to $248.7 million for the fiscal year ended December 31, 2022, a decrease of $44.3 million, or 18%. The following table sets forth the breakdown of our net revenues by end-product applications.
Net revenues were $176.6 million for the fiscal year ended December 31, 2024 as compared to $204.4 million for the fiscal year ended December 31, 2023, a decrease of $27.8 million, or 14%. The following table sets forth the breakdown of our net revenues by end-product applications.
Net cash used in investing activities was $7.9 million in the fiscal year ended December 31, 2022.
Net cash used in investing activities was $42.3 million in the fiscal year ended December 31, 2023.
Liquidity and Capital Resources We have financed our liquidity requirements from a variety of sources, including bank loans, other short-term loans and bills payable under bank credit agreements, advance from our related and unrelated parties, investors and issuance of capital stock. We recorded a net loss of $8.5 million in the fiscal year ended December 31, 2023.
Liquidity and Capital Resources We have financed our liquidity requirements from a variety of sources, including bank loans, other short-term loans and bills payable under bank credit agreements, advance from our related and unrelated parties, investors and issuance of capital stock. As of December 31, 2024, we had cash and cash equivalents and restricted cash of $60.8 million.
The facility was guaranteed by the Company’s CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. Under the facility, we borrowed RMB10 million (approximately $1.5 million) on April 29, 2022, bearing interest at 3.95% per annum for a term until April 29, 2023. We repaid RMB10 million (approximately $1.4 million) on April 19, 2023.
Under the facility, we borrowed RMB10 million (approximately $1.5 million) on April 29, 2022, bearing interest at 3.95% per annum for a term until April 29, 2023. We repaid RMB10 million (approximately $1.4 million) on April 19, 2023.
Ltd Shenyang Branch totaling RMB174.0 million (approximately $24.5 million) for various terms expiring through January to June 2024, which was secured by our cash totaling RMB174 million (approximately $24.5 million). We borrowed a series of acceptance bills from China Zheshang Bank Co.
We borrowed a series of acceptance bills from Bank of Nanjing totaling RMB37.2 million (approximately $5.1 million) for various terms expiring through May to June 2025, which was secured by our cash totaling RMB37.2 million (approximately $5.1 million). We borrowed a series of acceptance bills from China Zheshang Bank Co.
Our subsidiaries in PRC are subject to an income tax rate of 25%, except for Hitrans and CBAK Power which each was recognized as a “High and New Technology Enterprise” and enjoyed a preferential tax rate of 15% from 2021 to 2024.
Our subsidiaries in PRC are subject to an income tax rate of 25%, except for Hitrans, CBAK Power and Nanjing CBAK have been recognized as a “High and New Technology Enterprise” and enjoyed a preferential tax rate of 15% for three years from the approval date, expiring in 2025.
As a result of the above, our operating loss totaled $7.3 million for the year ended December 31, 2023, as compared to $11.5 million for 2022, a decrease of $4.3 million or 37.0%. Finance income, net. Finance income, net was $0.5 million for both the years ended December 31, 2023 and 2022. Other income (expenses), net.
As a result of the above, our operating income was $8.8 million for the year ended December 31, 2024, as compared to an operating loss of $7.3 million for 2023. Finance income, net. Finance income, net was $1.3 million and $0.4 million for the years ended December 31, 2024 and 2023, respectively.
As of December 31, 2023, we had not received any notices from investors to exercise the 2020 Warrants, which had also expired. 51 We currently are expanding our product lines and manufacturing capacity in our Dalian and Nanjing facilities, which require more funding to finance the expansion.
As of December 31, 2024, we had no warrants outstanding. 53 We currently are expanding our product lines and manufacturing capacity in our Dalian, Nanjing and Zhejiang facilities, which require more funding to finance the expansion.
Dollar Fiscal Year Ended December 31, December 31, 2022 2023 Balance sheet items, except for equity accounts 6.9091 7.0971 Amounts included in the statement of income and comprehensive loss and statement of cash flows 6.7264 7.0719
Dollar Fiscal Year Ended December 31, December 31, 2023 2024 Balance sheet items, except for equity accounts 7.0971 7.2994 Amounts included in the statement of income and comprehensive loss and statement of cash flows 7.0719 7.1913 ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Not applicable. 58
The net cash provided by operating activities in 2022 was mainly attributable to our net income of $6.9 million (before loss on disposal of property, plant and equipment, impairment charge of long-lived assets, impairment charge of goodwill and excluding non-cash depreciation and amortization, write-down of inventories, share-based compensation and changes in fair value of warrants liability), a decrease of trade and bills receivable of $21.0 million, decrease of prepayments and other receivables of $7.1 million, increase of trade and bills payable by $7.6 million offset by increase of inventories of $24.0 million and increase of trade receivable from Shenzhen BAK of $3.5 million.
The net cash provided by operating activities was mainly attributable to our net income of $23.4 million (before loss on disposal of property, plant and equipment, impairment charge of long-lived assets, share of loss of equity investee, gain on disposal of equity investee and excluding non-cash depreciation and amortization, write-down of inventories, share-based compensation and changes in expected credit losses), increase of our trade and bills payable by $4.6 million, an increase of accrued expenses and other payables and product warranty provision of $23.7 million, decrease of inventories by $6.3 million offset by increase of trade and bills receivable of $5.4 million, increase of prepayment and other receivables of $12.4 million.
We borrowed RMB10 million (approximately $1.4 million) on April 23, 2023. The loan was guaranteed by our CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan.
The loan was guaranteed by our former CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. We repaid the loan on April 9, 2024.
Under the facility, we have borrowed RMB59.0 million (approximately $8.5 million) as of December 31, 2022. In January 2023, we renewed the banking facilities with Shaoxing Branch of Bank of Communications Co., Ltd with a maximum amount of RMB160.0 million (approximately $22.1 million) with the term from January 2023 to December 2027.
In January 2023, the Company renewed the banking facilities with Shaoxing Branch of Bank of Communications Co., Ltd with a maximum amount of RMB160.0 million (approximately $22.1 million) with the term from January 2023 to December 2027. The facility was secured by the Company’s land use rights and buildings.
On May 17, 2022, we repaid the loan principal and related loan interests early. On April 28, 2022, we obtained a three-year term facility from Industrial and Commercial Bank of China Nanjing Gaochun branch, with a maximum amount of RMB12 million (approximately $1.7 million) with the term from April 21, 2022 to April 21, 2025.
On April 28, 2022, we obtained a three-year term facility from Industrial and Commercial Bank of China Nanjing Gaochun branch, with a maximum amount of RMB12 million (approximately $1.7 million) with the term from April 21, 2022 to April 21, 2025. The facility was guaranteed by our former CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan.
On November 10, 2022, we repaid the loan principal and the related loan interests early. On September 25, 2022, we entered into another one-year term facility with Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB9 million (approximately $1.3 million) bearing interest rate at 4.81% per annum.
On September 25, 2022, we entered into another one-year term facility with Jiangsu Gaochun Rural Commercial Bank with a maximum amount of RMB9 million (approximately $1.3 million) bearing interest rate at 4.81% per annum. The facility was guaranteed by 100% equity in CBAK Nanjing held by BAK Investment and the Company’s former CEO, Mr. Yunfei Li and Mr.
We believe that our sales campaign in the international market will contribute to a rebound in our sales volume in this sector in the near future.
We strive to continue to penetrate the market for batteries used in light electric vehicles, especially the international market such as India and Vietnam. We believe that our sales campaign in the international market will contribute to a rebound in our sales volume in this sector in the near future.
The facility was guaranteed by 100% equity in CBAK Nanjing held by BAK Investment and our CEO, Mr. Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB9 million (approximately $1.3 million) on September 27, 2022 for a term until September 24, 2023.
Yunfei Li’s wife Ms. Qinghui Yuan. We borrowed RMB9 million (approximately $1.3 million) on September 27, 2022 for a term until September 24, 2023.
Cost of revenues. Cost of revenues decreased to $172.7 million for the fiscal year ended December 31, 2023, as compared to $230.6 million for 2022, a decrease of $57.9 million, or 25.1%. The decrease in cost of revenues was in line with the decrease of net revenues. Gross profit.
Cost of revenues . Cost of revenues decreased to $134.8 million for the fiscal year ended December 31, 2024, as compared to $172.7 million for 2023, a decrease of $37.9 million, or 22%.
We borrowed a series of acceptance bills from Jiangsu Gaochun Rural Commercial Bank totaling RM30.6 million (approximately $4.3 million) for various terms expiring through March to April 2024, which was secured by our cash totaling RMB30.6 million (approximately $4.3 million).
We borrowed a series of acceptance bills totaling RMB55.6 million (approximately $7.6 million) for various terms expiring through April to June 2025, which was secured by our pledged deposit of RMB55.6 million (approximately $7.6 million.
The Company considers the historical write-off experience, customer specific facts and economic conditions in assessing the expected credit losses. Other key factors that influence the expected credit loss analysis include customer demographics, payment terms offered in the normal course of business to customers, and industry-specific factors that could impact the Company’s receivables.
Other key factors that influence the expected credit loss analysis include customer demographics, payment terms offered in the normal course of business to customers, and industry-specific factors that could impact the Company’s receivables. Additionally, external data and macroeconomic factors are also considered. This is assessed at each quarter based on the Company’s specific facts and circumstances.
We borrowed a series of acceptance bills from Bank of Ningbo Shaoxing Shangyu Branch totaling RMB6.7 million (approximately $0.9 million) for various terms expiring through May 2024, which was secured by our cash totaling RMB6.7 million (approximately $0.9 million). As of December 31, 2023, we had unutilized committed banking facilities of $2.8 million.
Ltd Shangyu Branch totaling RMB67.0 million (approximately $9.2 million) for various terms expiring through January to May 2025, which was secured by our pledged deposit of RMB59.7 million (approximately $8.2 million) and our bills receivables of RMB7.7 million (approximately $1.0 million). We borrowed a series of acceptance bills from Bank of Communications Co., Ltd.
(All amounts, other than percentage, in thousands of U.S. dollars) Years Ended Change December 31, December 31, 2022 2023 $ % High-power lithium batteries used in: Electric vehicles $ 4,695 $ 2,883 (1,812 ) -39 % Light electric vehicles 6,415 5,607 (808 ) -13 % Residential Energy Supply & Uninterruptable supplies 83,603 124,503 40,900 49 % Trading of Raw materials used in lithium batteries 2 - (2 ) -100 % 94,715 132,993 38,278 40 % Materials used in manufacturing of lithium batteries Cathode 75,331 39,846 (35,485 ) -47 % Precursor 78,679 31,599 (47,080 ) -60 % 154,010 71,445 (82,565 ) -54 % Total $ 248,725 $ 204,438 (44,287 ) -18 % Net revenues from sales of batteries for electric vehicles were $2.9 million for the fiscal year ended December 31, 2023, as compared to $4.7 million for 2022, a decrease of 39%.
(All amounts, other than percentage, in thousands of U.S. dollars) Years Ended Change December 31, December 31, 2023 2024 $ % High-power lithium batteries used in: Electric vehicles $ 2,883 $ 1,682 -1,201 -42 % Light electric vehicles 5,607 10,319 4,712 84 % Residential Energy Supply & Uninterruptable supplies 124,503 124,588 85 0 % 132,993 136,589 3,596 3 % Materials used in manufacturing of lithium batteries Cathode 39,846 34,229 -5,617 -14 % Precursor 31,599 5,797 -25,802 -82 % 71,445 40,026 -31,419 -44 % Total $ 204,438 $ 176,615 -27,823 -14 % Net revenues from sales of batteries for electric vehicles were $1.7 million for the fiscal year ended December 31, 2024, as compared to $2.9 million for 2023, a decrease of $1.2 million or 42%. 46 Net revenues from sales of batteries for light electric vehicles was approximately $10.3 million for the fiscal year ended December 31, 2024, as compared $5.6 million for 2023, representing an increase of $4.7 million, or 84%.
The increase in the income tax expenses was primarily due to the “full valuation allowance” of the deferred tax assets. Net loss. As a result of the foregoing, we had a net loss of $8.5 million and $11.3 million for the year ended December 31, 2023 and 2022, respectively.
Income tax expenses. Income tax expenses were $1.6 million for the year ended December 31, 2024, primarily attributable to our Dalian operations. Income tax expenses were $2.5 million for the year ended December 31, 2023 which was primarily due to the “full valuation allowance” of the deferred tax assets. Net income (loss).
Under the facility, we have borrowed RMB142.8 million (approximately $20.1 million) as of December 31, 2023, bearing interest at 3.55% to 3.65% per annum expiring through February to May 2024. 45 On April 19, 2021, we obtained five-year acceptance bills facilities from Bank of Ningbo Co., Ltd with a maximum amount of RMB84.4 million (approximately $11.6 million).
Under the facility, we have borrowed RMB142.8 million (approximately $20.1 million) and RMB159.9 million (approximately $21.9 million) as of December 31, 2023 and 2024, respectively, bearing interest at 3.45% to 3.65% per annum expiring through February to December 2025.
For the year ended December 31, 2023, the Company recorded $1.0 million in expected credit losses. As of December 31, 2023, the expected credit loss provision recorded in current assets was $3.2 million. The Company provides an allowance against trade receivable based on the expected credit loss approach and writes off trade receivables when they are deemed uncollectible.
The Company provides an allowance against trade receivable based on the expected credit loss approach and writes off trade receivables when they are deemed uncollectible. The Company considers the historical credit loss experience, customer specific facts and economic conditions in assessing the expected credit losses.
We borrowed a series of acceptance bills from China CITIC Bank totaling RMB0.4 million (approximately $0.1 million) for various terms expiring through March 2024, which was secured by our cash totaling RMB0.6 million (approximately $0.1 million).
We borrowed a series of acceptance bills totaling RMB210.8 million (approximately $28.9 million) for various terms expiring through January to June 2025, which was secured by our pledged deposit of RMB194.1 million (approximately $26.5 million, term deposit of RMB14.6 million (approximately $2.0 million) and our bills receivables of RMB2.5 million (approximately $0.4 million).
CBAK Nanjing obtained “High and New Technology Enterprise” certificate in late 2023 can enjoy a preferential tax rate of 15% for three years starting from 2023. Our Hong Kong subsidiaries, BAK Asia, BAK Investment and Nacell Holdings, are subject to profits tax at a rate of 16.5%.
Our Hong Kong subsidiaries, BAK Asia, BAK Investment and Hong Kong Hitrans, are subject to profits tax at a rate of 16.5%.
As of December 31, 2023, we had cash and cash equivalents and restricted cash of $58.8 million. Our total current assets were $128.4 million and our total current liabilities were $160.5 million, resulting in a net working capital deficit of $32.1 million.
Our total current assets were $141.4 million and our total current liabilities were $171.7 million, resulting in a net working capital deficit of $30.3 million.
Shangyu Branch with a maximum amount of RMB10 million (approximately $1.4 million) bearing interest at 5.5% per annum. The facility was guaranteed by 100% equity in CBAK Power held by BAK Asia and our CEO, Mr. Yunfei Li. We borrowed RMB10 million (approximately $1.4 million) on the same date.
The facility was guaranteed by our former CEO, Mr, Yunfei Li and Mr. Yunfei Li’s wife Ms. Qinghui Yuan. Under the facility, we borrowed RMB10 million (approximately $1.4 million) on June 24, 2024, bearing interest rate at 3.0% per annum. We early repaid the loan on August 23, 2024.
The increase primarily resulted from salaries and social insurance expenses due to a growing number of employees at Nanjing CBAK and Hitrans and compensation expenses incurred for restricted share units and options granted to our employees on April 11, 2023 and August 22, 2023.
The increase primarily resulted from $3.1 million increase in salaries and social insurance expenses due to a growing number of employees at Nanjing CBAK and the new operation in Shangqiu, offset by the $1.4 million decrease in materials and consumables used. Sales and marketing expenses .
General and administrative expenses increased to $13.8 million for the year ended December 31, 2023, as compared to $9.7 million for 2022, an increase of $4.1 million, or 41.6%.
As a result of the foregoing, we had a net income of $9.6 million for the year ended December 31, 2024 compared to a net loss of $8.5 million for the year ended December 31, 2023.
The change in fair value of warrants liability is mainly due to our share price decline. Income tax credit. Income tax expenses was $2.5 million for the year ended December 31, 2023, compared to an income tax credit of $1.2 million for the years ended December 31, 2022.
The finance income increase mainly resulted from increase in interest income from our term deposits and changes to exchange rates. Other income, net. Other income was $1.0 million and $3.0 million for the years ended December 31, 2024 and 2023, respectively. 47 Changes in fair value of warrants liability.
The net cash provided by financing activities for the year ended December 31, 2022 mainly comprised $21.6 million bank borrowings, $1.5 million from non-controlling interests injections, and $1.5 million from finance leases, partially offset by repayment of bank borrowings of $14.6 million and $3.7 million in repayment of loans to Mr. Ye Junnan.
The net cash used in financing activities was mainly comprised of repayment of bank borrowings of $52.1 million, $2.8 million repayment on finance lease and $4.3 million net movement from the placement of term deposit offset by $46.4 million bank borrowings and $1.1 million from finance lease.
Removed
The market for batteries used in electric vehicles has become highly competitive in 2023, with key players consistently reducing sales prices.
Added
The modest increase in battery sales for residential energy storage and uninterruptible power supplies was driven by our increasing demand for our Model 32140 from the portable power supply sector, partially offset by declining demand for our Model 26650.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

68 edited+15 added−31 removed294 unchanged
Biggest changeWe consummated the acquisition of 81.56% of registered equity interests (representing 75.57% of paid-up capital) in Hitrans in November 2021 (such ownership percentage reduced to 67.33% of registered equity interests (representing 72.99% of paid-up capital) as of December 31, 2023, as a result of Hitrans’s subsequent equity financings and our transfer of some of our equity interests in Hitrans).
Biggest changeAs of December 31, 2024, our ownership had reduced to 67.33% of registered equity interests (representing 72.99% of paid-up capital) as a result of Hitrans’s subsequent equity financings and our sale of certain equity interests in Hitrans. We have fully paid the registered capital of Hitrans that we had subscribed for. Since the acquisition, Hitrans’s revenue has declined.
Federal Deposit Insurance Corporation; on March 12, 2023, Signature Bank and Silvergate Capital Corp. were each swept into receivership; the following week, a syndicate of U.S. banks infused $30 billion in First Republic Bank; and later that same week, the Swiss Central Bank provided $54 billion in covered loan and short-term liquidity facilities to Credit Suisse Group AG, all in an attempt to reassure depositors and calm fears of a banking contagion.
Federal Deposit Insurance Corporation (the “FDIC”); on March 12, 2023, Signature Bank and Silvergate Capital Corp. were each swept into receivership; the following week, a syndicate of U.S. banks infused $30 billion in First Republic Bank; and later that same week, the Swiss Central Bank provided $54 billion in covered loan and short-term liquidity facilities to Credit Suisse Group AG, all in an attempt to reassure depositors and calm fears of a banking contagion.
On December 24, 2021, the CSRC issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) and the Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), collectively the Draft Overseas Listing Regulations, for public comment until January 23, 2022. 17 Following issuance of the Draft Overseas Listing Regulations, on February 17, 2023, the CSRC issued the Notice on Filing Arrangements for Overseas Securities Offering and Listing by Domestic Companies (the “CSRC Filing Notice”), stating that the CSRC has published the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (the “Trial Measures”) and five supporting guidelines (the “Listing Guidelines”), collectively the Trial Measures and Listing Guidelines.
On December 24, 2021, the CSRC issued the Provisions of the State Council on the Administration of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments) and the Administrative Measures for the Filing of Overseas Securities Offering and Listing by Domestic Companies (Draft for Comments), collectively the Draft Overseas Listing Regulations, for public comment until January 23, 2022. 18 Following issuance of the Draft Overseas Listing Regulations, on February 17, 2023, the CSRC issued the Notice on Filing Arrangements for Overseas Securities Offering and Listing by Domestic Companies (the “CSRC Filing Notice”), stating that the CSRC has published the Trial Administrative Measures of Overseas Securities Offering and Listing by Domestic Companies (the “Trial Measures”) and five supporting guidelines (the “Listing Guidelines”), collectively the Trial Measures and Listing Guidelines.
Any significant asset impairments would adversely impact our financial results. 25 If we cannot continue to develop new products in a timely manner, and at favorable margins, we may not be able to compete effectively. The battery industry has been notable for the pace of innovations in product life, product design and applied technology.
Any significant asset impairments would adversely impact our financial results. If we cannot continue to develop new products in a timely manner, and at favorable margins, we may not be able to compete effectively. The battery industry has been notable for the pace of innovations in product life, product design and applied technology.
The marketing, international distribution and sale of our products expose us to a number of risks, including: ● fluctuations in currency exchange rates; ● difficulty in engaging and retaining distributors that are knowledgeable about, and can function effectively in, overseas markets; ● increased costs associated with maintaining marketing efforts in various countries; ● difficulty and cost relating to compliance with the different commercial and legal requirements of the overseas markets in which we offer our products; ● inability to obtain, maintain or enforce intellectual property rights; and ● trade barriers such as export requirements, tariffs, taxes and other restrictions and expenses, which could increase the prices of our products and make us less competitive in some countries. 33 Our business depends substantially on the continuing efforts of our senior executives and other key personnel, and our business may be severely disrupted if we lose their services.
The marketing, international distribution and sale of our products expose us to a number of risks, including: ● fluctuations in currency exchange rates; ● difficulty in engaging and retaining distributors that are knowledgeable about, and can function effectively in, overseas markets; ● increased costs associated with maintaining marketing efforts in various countries; ● difficulty and cost relating to compliance with the different commercial and legal requirements of the overseas markets in which we offer our products; ● inability to obtain, maintain or enforce intellectual property rights; and ● trade barriers such as export requirements, tariffs, taxes and other restrictions and expenses, which could increase the prices of our products and make us less competitive in some countries. 34 Our business depends substantially on the continuing efforts of our senior executives and other key personnel, and our business may be severely disrupted if we lose their services.
In anticipation of an expected increase in the demand for high-power electric devices such as electric vehicles, light electric vehicles, electric tools, and energy storage including residential energy supply and UPS application in the next few years, we are building new manufacturing facilities in Nanjing and have invested in the R&D capability of our newly acquired battery materials business.
In anticipation of an expected increase in the demand for high-power electric devices such as electric vehicles, light electric vehicles, and energy storage including residential energy supply and UPS application in the next few years, we are building new manufacturing facilities in Nanjing and have invested in the R&D capability of our newly acquired battery materials business.
As we target the battery markets for light electric vehicles, electric vehicles, electric tools, energy storage including but not limited to residential energy supply & UPS application, and other high-power electric devices, our future success in part depends on whether end-application manufacturers are willing to use batteries that incorporate our products.
As we target the battery markets for light electric vehicles, electric vehicles, energy storage including but not limited to residential energy supply & UPS application, and other high-power electric devices, our future success in part depends on whether end-application manufacturers are willing to use batteries that incorporate our products.
For example, on July 30, 2021, Gary Gensler, Chairman of the SEC, issued a Statement on Investor Protection Related to Recent Developments in China, pursuant to which Chairman Gensler stated that he has asked the SEC staff to engage in targeted additional reviews of filings for companies with significant China-based operations.
For example, on July 30, 2021, Gary Gensler, former Chairman of the SEC, issued a Statement on Investor Protection Related to Recent Developments in China, pursuant to which Chairman Gensler stated that he has asked the SEC staff to engage in targeted additional reviews of filings for companies with significant China-based operations.
Additionally, the Trial Measures stipulate that after an issuer has offered and listed securities in an overseas market, the issuer shall submit a report to the CSRC within three working days after the occurrence and public disclosure of (i) a change of control thereof, (ii) investigations of or sanctions imposed on the issuer by overseas securities regulators or relevant competent authorities, (iii) changes of listing status or transfers of listing segment, and (iv) a voluntary or mandatory delisting. 18 The CSRC Filing Notice states that, beginning from March 31, 2023, PRC domestic enterprises which have already issued and listed securities overseas and fall within the scope of filing under the Trial Measures shall be considered “existing enterprises” (“Existing Listed Enterprises”).
Additionally, the Trial Measures stipulate that after an issuer has offered and listed securities in an overseas market, the issuer shall submit a report to the CSRC within three working days after the occurrence and public disclosure of (i) a change of control thereof, (ii) investigations of or sanctions imposed on the issuer by overseas securities regulators or relevant competent authorities, (iii) changes of listing status or transfers of listing segment, and (iv) a voluntary or mandatory delisting. 19 The CSRC Filing Notice states that, beginning from March 31, 2023, PRC domestic enterprises which have already issued and listed securities overseas and fall within the scope of filing under the Trial Measures shall be considered “existing enterprises” (“Existing Listed Enterprises”).
The costs to us to eliminate or alleviate security problems, viruses and bugs, or any problems associated with the outsourced services provided to us, could be significant, and efforts to address these problems could result in interruptions, delays or cessation of service that may impede our production, supply chain, sales, financial reporting or other critical functions and have a material adverse effect on our business, financial condition and results of operations. 32 In addition, the Chinese government and governments in other jurisdictions have enacted laws or regulations that require companies to notify individuals about certain types of security incidents or breaches, and any such disclosures may lead to negative publicity.
The costs to us to eliminate or alleviate security problems, viruses and bugs, or any problems associated with the outsourced services provided to us, could be significant, and efforts to address these problems could result in interruptions, delays or cessation of service that may impede our production, supply chain, sales, financial reporting or other critical functions and have a material adverse effect on our business, financial condition and results of operations. 33 In addition, the Chinese government and governments in other jurisdictions have enacted laws or regulations that require companies to notify individuals about certain types of security incidents or breaches, and any such disclosures may lead to negative publicity.
Such delisting from the NASDAQ Capital Market and continued or further declines in our share price could also greatly impair our ability to raise additional necessary capital through equity or debt financing and could significantly increase the ownership dilution to shareholders caused by our issuing equity in financing or other transactions.
Such delisting from the Nasdaq and continued or further declines in our share price could also greatly impair our ability to raise additional necessary capital through equity or debt financing and could significantly increase the ownership dilution to shareholders caused by our issuing equity in financing or other transactions.
In the event that our acquisition of other companies in China falls within the scope of these regulations, compliance with these regulations to complete such transactions could be time-consuming, and any required approval processes, including approval from the MOFCOM, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share. 20 CBAK Energy Technology, Inc., as a holding company incorporated in Nevada, the United States, without material operations of its own, relies on dividends and other distributions on equity paid by its PRC operating subsidiaries for its cash needs.
In the event that our acquisition of other companies in China falls within the scope of these regulations, compliance with these regulations to complete such transactions could be time-consuming, and any required approval processes, including approval from the MOFCOM, may delay or inhibit our ability to complete such transactions, which could affect our ability to expand our business or maintain our market share. 22 CBAK Energy Technology, Inc., as a holding company incorporated in Nevada, the United States, without material operations of its own, relies on dividends and other distributions on equity paid by its PRC operating subsidiaries for its cash needs.
In addition, uncertainty exists as to whether the courts of China would recognize or enforce judgments of U.S. courts obtained against us or such officers and/or directors predicated upon the civil liability provisions of the securities laws of the United States or any state thereof, or be competent to hear original actions brought in China against us or such persons predicated upon the securities laws of the United States or any state thereof. 21 PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies and governmental control of currency conversion may restrict or prevent CBAK Energy Technology, Inc. from making additional capital contributions or loans to its PRC subsidiaries.
In addition, uncertainty exists as to whether the courts of China would recognize or enforce judgments of U.S. courts obtained against us or such officers and/or directors predicated upon the civil liability provisions of the securities laws of the United States or any state thereof, or be competent to hear original actions brought in China against us or such persons predicated upon the securities laws of the United States or any state thereof. 23 PRC regulation of loans to, and direct investment in, PRC entities by offshore holding companies and governmental control of currency conversion may restrict or prevent CBAK Energy Technology, Inc. from making additional capital contributions or loans to its PRC subsidiaries.
As the Company continues to focus on innovation and renovation of its products, the Company’s business, financial condition or results of operations could be adversely affected in the event that the Company is not able to effectively develop and introduce new or renovated products and line or brand extensions. 26 Our failure, if any, to keep up with rapid technological changes and evolving industry standards may cause our products to become obsolete and less marketable, resulting in loss of market share to our competitors.
As the Company continues to focus on innovation and renovation of its products, the Company’s business, financial condition or results of operations could be adversely affected in the event that the Company is not able to effectively develop and introduce new or renovated products and line or brand extensions. 27 Our failure, if any, to keep up with rapid technological changes and evolving industry standards may cause our products to become obsolete and less marketable, resulting in loss of market share to our competitors.
Any investment in the common stock of CBAK Energy Technology, Inc. could be greatly reduced or even rendered worthless due to such allegations. 35 If we fail to comply with the continued listing requirements of NASDAQ, we would face possible delisting, which would result in a limited public market for shares of CBAK Energy Technology, Inc. and make obtaining future debt or equity financing more difficult for us.
Any investment in the common stock of CBAK Energy Technology, Inc. could be greatly reduced or even rendered worthless due to such allegations. 38 If we fail to comply with the continued listing requirements of Nasdaq, we would face possible delisting, which would result in a limited public market for shares of CBAK Energy Technology, Inc. and make obtaining future debt or equity financing more difficult for us.
As discussed in Note 1 to the consolidated financial statements included herein, we had a working capital deficiency, accumulated deficit from recurring net losses incurred for the prior years and significant short-term debt obligations maturing in less than one year as of December 31, 2023. These conditions raise substantial doubt about our ability to continue as a going concern.
As discussed in Note 1 to the consolidated financial statements included herein, we had a working capital deficiency, accumulated deficit from recurring net losses incurred for the prior years and significant short-term debt obligations maturing in less than one year as of December 31, 2024. These conditions raise substantial doubt about our ability to continue as a going concern.
If this market fails to achieve our expected level of growth, we may have excess production capacity and may not be able to generate enough revenue to maintain our profitability. 28 Our success, in part, depends on the success of manufacturers of the end applications that use our products, and our failure to gain acceptance of our products from such manufacturers could materially and adversely affect our results of operations and profitability.
If this market fails to achieve our expected level of growth, we may have excess production capacity and may not be able to generate enough revenue to maintain our profitability. 29 Our success, in part, depends on the success of manufacturers of the end applications that use our products, and our failure to gain acceptance of our products from such manufacturers could materially and adversely affect our results of operations and profitability.
With respect to the sale of our battery products, we typically offer warranties against any defects due to product malfunction or workmanship for a period of six months-to-eight years from the date of purchase, including a period of six to twenty-four months for battery cells, and a period of twelve to twenty-seven months for battery modules for electric bicycles, and a period of three years to eight years (or 120,000 or 200,000 km if reached sooner) for battery modules for electric vehicles.
With respect to the sale of our battery products, we typically offer warranties against any defects due to product malfunction or workmanship for a period of six months-to-five years from the date of purchase, including a period of six to twenty-four months for battery cells, and a period of twelve to twenty-seven months for battery modules for electric bicycles, and a period of three years to five years (or 120,000 or 200,000 km if reached sooner) for battery modules for electric vehicles.
Currently, we have facilities in Dalian, Nanjing and Shaoxing, China, which have about 337 R&D staffers and over 8,254 square meters of space dedicated to R&D activities. R&D activities, however, are inherently uncertain, and we might encounter practical difficulties in commercializing our research results. Accordingly, our significant investment in our R&D infrastructure may not bear fruit.
Currently, we have facilities in Dalian, Nanjing and Shaoxing, China, which have about 404 R&D staffers and over 8,254 square meters of space dedicated to R&D activities. R&D activities, however, are inherently uncertain, and we might encounter practical difficulties in commercializing our research results. Accordingly, our significant investment in our R&D infrastructure may not bear fruit.
These risks may have a material adverse effect on our business, financial condition and results of operations. 22 Under the Enterprise Income Tax Law, we may be classified as a “resident enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.
These risks may have a material adverse effect on our business, financial condition and results of operations. 24 Under the Enterprise Income Tax Law, we may be classified as a “resident enterprise” of China. Such classification will likely result in unfavorable tax consequences to us and our non-PRC shareholders.
Such impairment charges represented the excess of carrying amounts of long-lived assets over the estimated fair value of the production facilities in Hitrans for the production of materials used in manufacturing of lithium batteries. In addition, we recognized impairment losses for goodwill of $1.6 million for the year ended December 31, 2022 due to the underperformance of the Hitrans segment.
Such impairment charges represented the excess of carrying amounts of long-lived assets over the estimated fair value of the production facilities in Hitrans for the production of materials used in manufacturing of lithium batteries. We also recognized impairment losses for goodwill of $1.6 million for the year ended December 31, 2022 due to the underperformance of the Hitrans segment.
Any accident, whether occurring at the manufacturing facilities or from the use of our products, may result in significant production interruption, delays or claims for substantial damages caused by personal injuries or property damages. 29 We may not be able to substantially increase our manufacturing output in order to maintain our cost competitiveness.
Any accident, whether occurring at the manufacturing facilities or from the use of our products, may result in significant production interruption, delays or claims for substantial damages caused by personal injuries or property damages. 30 We may not be able to substantially increase our manufacturing output in order to maintain our cost competitiveness.
Also, such a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition, and prospects. 16 The PRC government exerts substantial influence over the manner in which we conduct our business activities.
Also, such a prohibition would significantly affect our ability to raise capital on terms acceptable to us, or at all, which would have a material adverse impact on our business, financial condition, and prospects. 17 The PRC government exerts substantial influence over the manner in which we conduct our business activities.
Currently, we do not have a business relationship with any of the banking institutions mentioned above, and our cash, cash equivalents and short term investments that are mostly concentrated in China have been unaffected by the turmoil in the financial industry in the US and Europe; however, we cannot guarantee that the banking institution with which we do business will not face similar circumstances in the future, or that the third parties with whom we do business will not be negatively affected by such circumstances.
Currently, we do not have a business relationship with any of the banking institutions mentioned above, and our cash, cash equivalents and short term investments that are mostly concentrated in China have been unaffected by the turmoil in the financial industry in the US and Europe; however, we cannot guarantee that the banking institution with which we do business will not face similar circumstances in the future, or that the third parties with whom we do business will not be negatively affected by such circumstances. 40 ITEM 1B.
Both Bulletin 37 and Bulletin 7 do not apply to transactions of sale of shares by investors through a public stock exchange where such shares were acquired from a transaction through a public stock exchange. 23 There is uncertainty as to the application of Bulletin 37 or previous rules under Bulletin 7.
Both Bulletin 37 and Bulletin 7 do not apply to transactions of sale of shares by investors through a public stock exchange where such shares were acquired from a transaction through a public stock exchange. 25 There is uncertainty as to the application of Bulletin 37 or previous rules under Bulletin 7.
CBAK Energy Technology, Inc.’s common stock is traded and listed on the NASDAQ Capital Market under the symbol “CBAT”, which was changed from “CBAK” on November 30, 2018. The common stock may be delisted if we fail to maintain certain NASDAQ listing requirements.
CBAK Energy Technology, Inc.’s common stock is traded and listed on the Nasdaq under the symbol “CBAT”, which was changed from “CBAK” on November 30, 2018. The common stock may be delisted if we fail to maintain certain Nasdaq listing requirements.
Failure to comply with PRC environmental laws and regulations may materially and adversely affect our business, financial condition and results of operations. 31 We rely significantly on technology and systems to support our production, supply chain, payments, financial reporting and other key aspects of our business.
Failure to comply with PRC environmental laws and regulations may materially and adversely affect our business, financial condition and results of operations. 32 We rely significantly on technology and systems to support our production, supply chain, payments, financial reporting and other key aspects of our business.
However, acquisitions generally create risks such as (i) the need to integrate and manage the businesses and products acquired with our own business and products; (ii) additional demands on our resources, systems, procedures and controls; (iii) disruption of our ongoing business; (iv) potential unknown or unquantifiable liabilities associated with the target company; and (v) diversion of management’s attention from other business concerns.
Acquisitions generally pose risks such as (i) the need to integrate and manage the businesses and products acquired with our own business and products; (ii) additional demands on our resources, systems, procedures and controls; (iii) disruption of our ongoing business; (iv) potential unknown or unquantifiable liabilities associated with the target company; and (v) diversion of management’s attention from other business concerns.
A significant increase in the cost of insurance coverage could adversely affect our business, financial condition and results of operations. 30 We depend on third parties to supply key raw materials and components to us.
A significant increase in the cost of insurance coverage could adversely affect our business, financial condition and results of operations. 31 We depend on third parties to supply key raw materials and components to us.
Management attention may be diverted from regular business concerns by reorganizations. We and our independent public accounting firm identified material weaknesses in our internal control over financial reporting as of December 31, 2023.
Management attention may be diverted from regular business concerns by reorganizations. 35 We and our independent public accounting firm identified material weaknesses in our internal control over financial reporting as of December 31, 2024.
For the years ended December 31, 2023 and 2022, we derived 42% and 20%, respectively, of our sales from outside the PRC mainland. We deem overseas market as an important revenue source for us, and have been actively pursuing opportunities to expand our customer base overseas.
For the years ended December 31, 2024 and 2023, we derived 44% and 42%, respectively, of our sales from outside the PRC mainland. We deem overseas market as an important revenue source for us, and have been actively pursuing opportunities to expand our customer base overseas.
Our operating results could be adversely affected by increases in the cost of raw materials, particularly Ni, Co, Mn, Li2CO3, LiPF6 and LiFePO4, the primary cost component of our battery products, battery material products or other product parts or components. The price of Ni, Co, Mn, Li2CO3, LiPF6 and LiFePO4 is not stable.
Our operating results could be adversely affected by increases in the cost of raw materials, particularly Ni, Co, Mn, Li2CO3, LiPF6 and LiFePO4, the primary cost component of our battery products, battery material products or other product parts or components. The prices of Ni, Co, Mn, Li2CO3, LiPF6 and LiFePO4 are not stable.
We are aware of certain companies, including Sumitomo Metal Mining Co., Ltd., Umicore N.V., Beijing Easpring Material Technology Co., Ltd. and Ningbo Ronbay Lithium Battery Material Co., Ltd. using cell chemistry technology similar to our technology and these or other companies have introduced or could introduce products that compete directly with our products and could in the future outperform our products in one or more performance attributes, could be offered to our customers as a cheaper alternative to our products or may result in increased pricing pressure on our products. 27 We are dependent on a limited number of customers for a significant portion of our revenues and this dependence is likely to continue.
We are aware of certain companies, including Beijing Easpring Material Technology Co., Ltd. and Ningbo Ronbay Lithium Battery Material Co., Ltd. using cell chemistry technology similar to our technology and these or other companies have introduced or could introduce products that compete directly with our products and could in the future outperform our products in one or more performance attributes, could be offered to our customers as a cheaper alternative to our products or may result in increased pricing pressure on our products. 28 We are dependent on a limited number of customers for a significant portion of our revenues and this dependence is likely to continue.
These factors include: ● our earnings releases, actual or anticipated changes in our earnings, fluctuations in our operating results or our failure to meet the expectations of financial market analysts and investors; ● changes in financial estimates by us or by any securities analysts who might cover the common stock; ● speculation about our business in the press or the investment community; ● significant developments relating to our relationships with our customers or suppliers; ● stock market price and volume fluctuations of other publicly traded companies and, in particular, those that are in our industries; ● customer demand for our products; ● investor perceptions of our industry in general and our company in particular; ● the operating and stock performance of comparable companies; ● general economic conditions and trends; ● major catastrophic events; ● announcements by us or our competitors of new products, significant acquisitions, strategic partnerships or divestitures; ● changes in accounting standards, policies, guidance, interpretation or principles; ● loss of external funding sources; ● sales of our shares, including sales by our directors, officers or significant shareholders; and ● additions or departures of key personnel.
These factors include: ● our earnings releases, actual or anticipated changes in our earnings, fluctuations in our operating results or our failure to meet the expectations of financial market analysts and investors; ● changes in financial estimates by us or by any securities analysts who might cover the common stock; ● speculation about our business in the press or the investment community; ● significant developments relating to our relationships with our customers or suppliers; ● stock market price and volume fluctuations of other publicly traded companies and, in particular, those that are in our industries; ● customer demand for our products; ● investor perceptions of our industry in general and our company in particular; ● the operating and stock performance of comparable companies; ● general economic conditions and trends; ● major catastrophic events; ● announcements by us or our competitors of new products, significant acquisitions, strategic partnerships or divestitures; ● changes in accounting standards, policies, guidance, interpretation or principles; ● loss of external funding sources; ● sales of our shares, including sales by our directors, officers or significant shareholders; and ● additions or departures of key personnel. 37 In the past, shareholders of a public company often brought securities class action suits against the company following periods of instability in the market price of that company’s securities.
In response to the SEC’s July 30, 2021 statement, the CSRC announced on August 1, 2021, that “it is our belief that Chinese and U.S. regulators shall continue to enhance communication with the principle of mutual respect and cooperation, and properly address the issues related to the supervision of China-based companies listed in the U.S. so as to form stable policy expectations and create benign rules framework for the market.” The CSRC pledged to continue to collaborate “closely with different stakeholders including investors, companies, and relevant authorities to further promote transparency and certainty of policies and implementing measures,” and emphasized that it “has always been open to companies’ choices to list their securities on international or domestic markets in compliance with relevant laws and regulations.” If any new legislation, executive orders, laws and/or regulations are implemented, if the U.S. or Chinese governments take retaliatory actions due to the recent U.S.-China tension or if the Chinese government exerts more oversight and control over securities offerings that are conducted in the United States, such changes could have an adverse effect on our business, financial condition and results of operations, our ability to raise capital and the value of our securities. 19 There are uncertainties regarding the interpretation and enforcement of PRC laws, rules and regulations.
However, it is possible that the Company’s filings with the SEC may be subject to enhanced review by the SEC. 20 In response to the SEC’s July 30, 2021 statement, the CSRC announced on August 1, 2021, that “it is our belief that Chinese and U.S. regulators shall continue to enhance communication with the principle of mutual respect and cooperation, and properly address the issues related to the supervision of China-based companies listed in the U.S. so as to form stable policy expectations and create benign rules framework for the market.” The CSRC pledged to continue to collaborate “closely with different stakeholders including investors, companies, and relevant authorities to further promote transparency and certainty of policies and implementing measures,” and emphasized that it “has always been open to companies’ choices to list their securities on international or domestic markets in compliance with relevant laws and regulations.” If any new legislation, executive orders, laws and/or regulations are implemented, if the U.S. or Chinese governments take retaliatory actions due to the recent U.S.-China tension or if the Chinese government exerts more oversight and control over securities offerings that are conducted in the United States, such changes could have an adverse effect on our business, financial condition and results of operations, our ability to raise capital and the value of our securities.
According to this agreement, we intended to develop certain lithium battery projects which are expected to have a total production capacity of 20 GWh per year with support from Gaochun EDZ. See also “Item 1. Business—Expansion of Manufacturing Capabilities” for additional information on our cooperation with Gaochun EDZ.
According to this agreement, we intended to develop certain lithium battery projects which are expected to have a total production capacity of approximately 20 GWh per year with support from Gaochun EDZ. See also “ Item 1. Business—Expansion of Manufacturing Capabilities ” for additional information on our cooperation with Gaochun EDZ.
For this reason, we were not identified as a Commission-Identified Issuer after we filed on April 15, 2023 the annual report on Form 10-K for the fiscal year ended December 31, 2022 and we do not expect to be identified as a Commission-Identified Issuer under the HFCAA after we file this annual report on Form 10-K for the fiscal year ended December 31, 2023.
For this reason, we have not been identified as a Commission-Identified Issuer after we filed on April 14, 2023 the annual report on Form 10-K for the fiscal year ended December 31, 2022 and we do not expect to be identified as a Commission-Identified Issuer under the HFCAA after we file this annual report on Form 10-K for the fiscal year ended December 31, 2024.
Our future success heavily depends on the continued service of our senior executives and other key employees. In particular, we rely on the expertise and experience of our Chairman, Chief Executive Officer, President Mr. Yunfei Li and our Chief Financial Officer, Mr. Jiewei Li.
Our future success heavily depends on the continued service of our senior executives and other key employees. In particular, we rely on the expertise and experience of our Chief Executive Officer, Mr. Zhiguang Hu and our Chief Financial Officer, Mr. Jiewei Li.
Maintaining our R&D activities and manufacturing operations require significant capital expenditures, and our inability or failure to maintain our operations could have a material adverse impact on our market share and ability to generate revenue. We incurred capital expenditures of approximately $12.4 million and $31.1 million for the years ended December 31, 2022 and 2023, respectively.
Maintaining our R&D activities and manufacturing operations requires significant capital expenditures, and our inability or failure to maintain our operations could have a material adverse impact on our market share and ability to generate revenue. We incurred capital expenditures of approximately $31.1 million and $17.2 million for the years ended December 31, 2023 and 2024, respectively.
On September 27, 2023, we received notice from the Listing Qualifications Department of The NASDAQ Stock Market (“Nasdaq”) indicating that, for the last 30 consecutive business days, the bid price for the common stock had closed below the minimum $1.00 per share and as a result, CBAK Energy Technology, Inc. was no longer in compliance with the NASDAQ Listing Rule 5550(a)(2).
On December 26, 2024, we received notice from the Listing Qualifications Department of Nasdaq indicating that, for the preceding 30 consecutive business days, the bid price for the common stock had closed below the minimum $1.00 per share and as a result, CBAK Energy Technology, Inc. was no longer in compliance with the Nasdaq Listing Rule 5550(a)(2).
We have put into operation two production lines of model 32140 large-sized cylindrical “tabless” batteries with a production capacity of 2 GWh per year. Model 32140 batteries can be used in light electric vehicles, electric vehicles, electric tools and energy storage.
We have put into operation two production lines of model 32140 large-sized cylindrical “tabless” batteries with an actual production capacity of 1.3 GWh per year. Model 32140 batteries can be used in light electric vehicles, electric vehicles and energy storage.
In 2023, our sales of cathode materials and precursors reached $71.4 million. However, we cannot guarantee that the market demand for the cathode materials and precursors will not decline. Even if a manufacturer decides to use batteries that incorporate our products, the manufacturer may not be able to market and sell its products successfully.
However, we cannot guarantee that the market demand for the cathode materials and precursors will not decline. Even if a manufacturer decides to use batteries that incorporate our products, the manufacturer may not be able to market and sell its products successfully.
We also announced in June 2023 that we had succeeded in mass-producing Model 32140 sodium-ion cylindrical batteries, making us one of only a few companies in the world that have the capacity to mass produce sodium-ion batteries. We are also in the process of developing larger-sized cylindrical batteries including Model 40140 and Model 46120.
We also announced in June 2023 that we had succeeded in mass-producing Model 32140 sodium-ion cylindrical batteries, making us one of only a few companies in the world that have the capacity to mass produce sodium-ion batteries.
The statement also addressed risks inherent in companies with VIE structures. We have never adopted a VIE structure and are not in any industry that is subject to foreign ownership limitations by China. However, it is possible that the Company’s filings with the SEC may be subject to enhanced review by the SEC.
The statement also addressed risks inherent in companies with VIE structures. We have never adopted a VIE structure and are not in any industry that is subject to foreign ownership limitations by China.
Any intellectual property litigation could have a material adverse effect on our business, results of operation and financial condition. 37 Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties, could adversely affect our current and projected business operations and our financial condition and results of operations.
Adverse developments affecting the financial services industry, such as actual events or concerns involving liquidity, defaults, or non-performance by financial institutions or transactional counterparties, could adversely affect our current and projected business operations and our financial condition and results of operations.
We purchase from Chinese domestic suppliers for certain key raw materials and components such as electrolytes, electrode materials and separators for our battery cell products and purchase from Chinese domestic suppliers for cobaltous sulfates, manganese sulfates, lithium hydroxides, lithium carbonates and liquid nickel sulfates. We have purchased raw materials and components on the basis of purchase orders.
We purchase from Chinese domestic suppliers for certain key raw materials and components such as electrolytes, electrode materials and separators for our battery cell products and purchase from Chinese domestic suppliers for graphite, iron phosphate and lithium phosphate. We have purchased raw materials and components on the basis of purchase orders.
We have been dependent on a limited number of customers for a significant portion of our revenue. Our top five customers accounted for approximately 59.2% and 69.5% of our revenues for the years ended December 31, 2023 and 2022, respectively.
We have been dependent on a limited number of customers for a significant portion of our revenue. Our top five customers accounted for approximately 66.1% and 65.6% of our revenues for the years ended December 31, 2024 and 2023, respectively.
Yunfei Li, our president and chief executive officer and chairman of our board, and our other executive officers and directors beneficially own an aggregate of 12.89% of outstanding common stock of CBAK Energy Technology, Inc. as of December 31, 2023.
Mr. Yunfei Li, chairman of our board, and our other executive officers and directors beneficially own an aggregate of 13.17% of outstanding common stock of CBAK Energy Technology, Inc. as of December 31, 2024.
Increasing concerns over bank failures and bailouts and their potential broader effects and potential systemic risk on the global banking sector generally and its participants may adversely affect our access to capital and our business and operations more generally.
A weak or declining economy could also impact third parties upon whom we depend to run our business. Increasing concerns over bank failures and bailouts and their potential broader effects and potential systemic risk on the global banking sector generally and its participants may adversely affect our access to capital and our business and operations more generally.
Testing for potential impairment of long-lived assets is dependent on numerous assumptions and reflects our best estimates at a particular point in time, which may vary from testing date to testing date.
Assessment of the potential impairment of property, plant and equipment and other identifiable intangible assets is an integral part of our normal ongoing review of operations. Testing for potential impairment of long-lived assets is dependent on numerous assumptions and reflects our best estimates at a particular point in time, which may vary from testing date to testing date.
Moreover, this acquisition involved substantial investment of funds from our previous equity financings, resulted in one-time charges and expenses. This acquisition may not be successful in generating revenue, income or other returns, and any resources we committed will not be available to us for other purposes.
This acquisition involved substantial investment of funds from our previous equity financings and resulted in one-time charges and expenses. Given Hitrans’s underperformance since the acquisition, we may not achieve the anticipated revenue, income, or other returns, and the resources we have committed may not be available for other strategic opportunities.
Any additional impairment of goodwill or other intangible assets acquired in connection with Hitrans’s acquisition or in another acquisition or charges to earnings associated with any acquisition or investment activity, may materially reduce our earnings.
Any additional impairment of goodwill or other intangible assets acquired in connection with Hitrans’s acquisition or in another acquisition or charges to earnings associated with any acquisition or investment activity, may materially reduce our earnings. 26 We may face additional impairment charges if economic environments in which our businesses operate and key economic and business assumptions substantially change.
However, the development of this new line of business was not successful due to the competitive landscape and evolving market preferences. Consequently, Nanjing BFD has shifted away from the development and manufacture of electric bicycles, motorcycles and automotive spare parts and pivoted towards the manufacture of sodium-ion batteries since 2023.
Consequently, Nanjing BFD has shifted away from the development and manufacture of electric bicycles, motorcycles and automotive spare parts and pivoted towards the manufacture of sodium-ion batteries since 2023.
Accordingly, you should review our SEC reports, filings and our other public pronouncements with the understanding that no local regulator has done any due diligence on our company and with the understanding that none of our SEC reports, other filings or any of our other public pronouncements has been reviewed or otherwise been scrutinized by any local regulator. 36 You may experience dilution to the extent that shares of the common stock are issued upon the exercise of outstanding warrants or other securities that CBAK Energy Technology, Inc. may issue in the future.
Accordingly, you should review our SEC reports, filings and our other public pronouncements with the understanding that no local regulator has done any due diligence on our company and with the understanding that none of our SEC reports, other filings or any of our other public pronouncements has been reviewed or otherwise been scrutinized by any local regulator. 39 Our directors and executive officers, collectively, own approximately 13.17% of outstanding common stock of CBAK Energy Technology, Inc. and may possess significant influence in or control over our management and affairs.
Parties making the infringement claim may also obtain an injunction that can prevent us from selling our products or using technology that contains the allegedly infringing contents.
Parties making the infringement claim may also obtain an injunction that can prevent us from selling our products or using technology that contains the allegedly infringing contents. Any intellectual property litigation could have a material adverse effect on our business, results of operation and financial condition.
For example, a wave of infections caused by the Omicron variant emerged in Shanghai in early 2022, and a series of restrictions and quarantines were implemented in Shanghai and other regions to contain the spread.
In early 2022, a wave of infections caused by the Omicron variant emerged in Shanghai, and a series of restrictions and quarantines were implemented in Shanghai and other regions to contain the spread. Our manufacturing facilities did not produce at full capacity when restrictive measures were in force for the areas where our manufacturing operations were located during 2022.
The ongoing COVID-19 pandemic as well as other possible health epidemics and outbreaks could have a material adverse impact on our or our customers’ business operations including reduction or suspension of operations in China, the U.S. or certain parts of the world.
Especially, our manufacturing operations, among others, cannot be conducted remotely and often require on-site access to materials and equipment. The possible health epidemics and outbreaks could have a material adverse impact on our or our customers’ business operations including reduction or suspension of operations in China, the U.S. or certain parts of the world.
This could negatively impact our revenues and adversely affect our reputation and relationships with our customers, causing a material adverse effect on our financial condition, results of operations and prospects.
This could negatively impact our revenues and adversely affect our reputation and relationships with our customers, causing a material adverse effect on our financial condition, results of operations and prospects. Our business depends on the growth in demand for light electric vehicles, electric vehicles, energy storage, such as residential energy supply and UPS application, and other high-power electric devices.
Our ability to effectively run our business could be adversely affected by general conditions in the global economy and in the financial services industry. Various macroeconomic factors could adversely affect our business, including fears concerning the banking sector, changes in inflation, interest rates and overall economic conditions and uncertainties.
Our ability to effectively run our business could be adversely affected by general conditions in the global economy and in the financial services industry. Although the U.S.
We regained compliance with the minimum bid price rule on January 8, 2024. We cannot assure you that CBAK Energy Technology, Inc. will continue to comply with the requirements for continued listing on the NASDAQ Capital Market in the future.
We cannot assure you that CBAK Energy Technology, Inc. will cure the bid price deficiency before the expiration of the Compliance Period or continue to comply with other requirements for continued listing on the Nasdaq in the future. If the common stock loses its status on the Nasdaq, the common stock would likely trade in the over-the-counter market.
Our inability to take advantage of growth opportunities or address risks associated with this acquisition and investment may negatively affect our operating results. Additionally, we have recognized impairment losses for long-lived assets of $7.1 million and $4.8 million for the years ended December 31, 2023 and 2022, respectively.
If we are unable to reverse the declining performance of Hitrans or mitigate associated risks, our operating results could be negatively impacted. Additionally, we have recognized impairment losses for long-lived assets of $0.5 million and $7.1 million for the years ended December 31, 2024 and 2023, respectively.
Since late 2019, the outbreak of a novel strain of coronavirus named COVID-19 has materially and adversely affected the global economy. In response, China imposed widespread lockdowns, closure of workplaces and restrictions on mobility and travel to contain the spread of the virus.
Our business could be materially and adversely affected by the outbreak of a widespread health epidemic, such as COVID-19, avian flu or African swine flu. For instance, in response to COVID-19 China imposed widespread lockdowns, closure of workplaces and restrictions on mobility and travel to contain the spread of the virus.
To secure acceptance of our products, we must constantly develop and introduce more reliable and cost-effective battery cells and battery materials with enhanced functionality to meet evolving industry standards. Our failure to gain acceptance of our products from these manufacturers could materially and adversely affect our future success.
To secure acceptance of our products, we must constantly develop and introduce more reliable and cost-effective battery cells and battery materials with enhanced functionality to meet evolving industry standards. We generated approximately $1.7 million revenues from electric vehicle customers in 2024. In 2024, our sales of cathode materials and precursors reached $40.0 million.
A severe or prolonged economic downturn could result in a variety of risks, including our ability to raise additional funding on a timely basis or on acceptable terms. A weak or declining economy could also impact third parties upon whom we depend to run our business.
Various macroeconomic factors could adversely affect our business, including fears concerning the banking sector, changes in inflation, interest rates and overall economic conditions and uncertainties. A severe or prolonged economic downturn could result in a variety of risks, including our ability to raise additional funding on a timely basis or on acceptable terms.
In addition, as of December 31, 2023, we have been gradually phasing out our light electric vehicle business. In 2020, we ventured into developing light electric vehicle projects. On November 9, 2020, we established our new subsidiary, Nanjing BFD, formally named Nanjing Daxin, to launch and develop our light electric vehicle business.
On November 9, 2020, we established our new subsidiary, Nanjing BFD, formally named Nanjing Daxin, to launch and develop our light electric vehicle business. However, the development of this new line of business was not successful due to the competitive landscape and evolving market preferences.
As a result, our business, financial condition, results of operations and prospects, as well as the trading price of our shares, may be adversely affected. 34 RISKS RELATED TO COMMON STOCK Numerous factors, many of which are beyond our control, may cause the market price of common stock to fluctuate significantly.
Moreover, effective internal control over financial reporting is important to prevent fraud. As a result, our business, financial condition, results of operations and prospects, as well as the trading price of our shares, may be adversely affected. Our business has been and may continue to be adversely affected by the outbreaks of viruses or other health epidemics and outbreaks.
We believe that our ability to provide cost-effective products is one of the most significant factors that contributed to our past success and will be essential for our future growth. We believe this is one of our competitive advantages over our Japanese and Korean competitors.
We believe that our ability to offer products at lower costs – leveraging economies of scale from fully operational production lines—while maintaining prices above the market average has been a key driver of o our past success and will be vital to our future growth. We believe this is one of our competitive advantages over our competitors.
The audited consolidated financial statements included in this report do not include any adjustments that might result from the outcome of this uncertainty. Our business has been and may continue to be adversely affected by the ongoing global COVID-19 pandemic or other health epidemics and outbreaks.
The audited consolidated financial statements included in this report do not include any adjustments that might result from the outcome of this uncertainty. The acquisition of a controlling Interest in Hitrans has not fully delivered the anticipated benefits, as its financial performance has fallen short of initial expectations.
Removed
After the initial outbreak in late 2019, from time to time, some instances of COVID-19 infections have emerged in various regions of China, including infections caused by the Omicron variant.
Added
In August 2023, former President Biden issued an executive order to restrict U.S. investments in sensitive technologies in the Chinese mainland, Hong Kong, and Macau, such as advanced computing chips, quantum technology, and artificial intelligence.
Removed
Our manufacturing facilities were not producing at full capacity when restrictive measures were in force for the areas where our manufacturing operations are located during 2022. China began to modify its zero-COVID policy at the end of 2022, and most of the travel restrictions and quarantine requirements were lifted in December 2022.
Added
As of the date of this annual report, the final rules implementing the order have not become effective yet, and the scope of the review program may be materially different from what is currently contemplated by the advance notice.
Removed
Although the COVID-19 pandemic has caused disruptions to our operations, it has had limited adverse impacts on our operating results for the fiscal year ended December 31, 2023.
Added
Therefore, there are substantial uncertainties on whether the outbound foreign direct investment review program will have a material impact on our business, results of operations, financial condition, and prospects. On the other hand, the United States and China have imposed new or higher tariffs on goods imported from each other, including tariff increases announced by both countries in early 2025.
Removed
We generated revenues of $204.44 million and $248.73 million for the fiscal years ended December 31, 2023 and 2022, respectively. 24 There may be surges of cases in certain regions in the future, and there remains uncertainty as to the future impact of the virus, especially in light of this change in policy.
Added
If the United States or China continues imposing such tariffs, or if additional tariffs or trade restrictions are implemented by the United States or by China, the resulting trade barriers could have a significant adverse impact on our business.
Removed
We cannot be assured that more lockdowns and other restrictive measures will not be implemented in the future. Some other countries, including the U.S., also introduced various restrictions in response to the COVID-19 pandemic.
Added
The adoption and expansion of trade restrictions and tariffs, quotas and embargoes, sanctions, the occurrence of a trade war, or other governmental action related to tariffs or trade agreements or policies, has the potential to adversely impact costs, our suppliers and the world economy in general, which in turn could have a material adverse effect on our business, results of operations and financial condition.
Removed
Our manufacturing operations, among others, cannot all be conducted in a remote working structure and often require on-site access to materials and equipment. Our international customers account for approximately 42% of our sales in 2023.
Added
We cannot foresee whether and how developments in similar policy actions or any other policy actions taken by the U.S. or Chinese government will impact our business and financial performance.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeThe Company’s Board of Directors and senior management are committed to continuously evaluating and upgrading our cybersecurity prevention, detection, and mitigation strategies in line with the evolution of our business needs and cybersecurity risks. 38 In the fiscal year ended December 31, 2023, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations or financial condition.
Biggest changeIn the fiscal year ended December 31, 2024, we did not identify any cybersecurity threats that have materially affected or are reasonably likely to materially affect our business strategy, results of operations or financial condition. However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents.
Any failure, inadequacy, interruption or security failure of those systems could have a material adverse effect on our business, reputation and brand, financial condition, and results of operations” and “Risks Related to Our Business—System security risk issues, and disruption of our internal operations or information technology systems, could have a material adverse effect on our business, financial condition, and results of operations” in Item 1A-Risk Factors.
Any failure, inadequacy, interruption or security failure of those systems could have a material adverse effect on our business, reputation and brand, financial condition, and results of operations ” and “ Risks Related to Our Business—System security risk issues, and disruption of our internal operations or information technology systems, could have a material adverse effect on our business, financial condition, and results of operations ” in Item 1A-Risk Factors. 41
The Company’s Chief Executive Officer, an engineering expert with over eight years of experience in leading our company, is responsible for developing and implementing our information security measures and overseeing our IT department. The Company has established a physical firewall, with physical gateways that filter suspicious files and data flows entering and exiting our Company’s network.
The Company’s Chief Executive Officer is responsible for developing and implementing our information security measures and overseeing our IT department. The Company has established a physical firewall, with physical gateways that filter suspicious files and data flows entering and exiting our Company’s network.
However, despite our efforts, we cannot eliminate all risks from cybersecurity threats, or provide assurances that we have not experienced undetected cybersecurity incidents. For additional information about these risks, see “Risks Related to Our Business—We rely significantly on technology and systems to support our production, supply chain, payments, financial reporting and other key aspects of our business.
For additional information about these risks, see “ Risks Related to Our Business—We rely significantly on technology and systems to support our production, supply chain, payments, financial reporting and other key aspects of our business.
Given that our core operations are in manufacturing and involve limited network-related activities, we believe that our existing cybersecurity measures are adequate.
Given that our core operations are in manufacturing and involve limited network-related activities, we believe that our existing cybersecurity measures are adequate. The Company’s Board of Directors and senior management are committed to continuously evaluating and upgrading our cybersecurity prevention, detection, and mitigation strategies in line with the evolution of our business needs and cybersecurity risks.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeFacility Usage Area (m 2 ) Constructions completed – facilities owned Manufacturing 46,016 R&D and administrative 9,745 Warehousing 29,018 Other facilities 1,803 Total 86,582 Constructions–completed - facilities rented Manufacturing 31,743 Warehousing 9,674 Administrative 8,272 Total 49,689 The following table presents the total acreage of facilities controlled by each of our major operating subsidiaries as of December 31, 2023: Area (m 2 ) Dalian CBAK Power facilities site area Total 72,810 Nanjing CBAK facility site area Total 27,141 Nanjing BFD facilities site area Total 548 Hitrans facilities site area Total 13,772 See also “ Item 1.
Biggest changeFacility Usage Area (m 2 ) Constructions completed – facilities owned Manufacturing 43,875 R&D and administrative 10,659 Warehousing 16,879 Other facilities 15,169 Total 86,582 Constructions–completed - facilities rented Manufacturing 36,743 Warehousing 13,263 Administrative 6,414 Other facilities 5,000 Total 61,420 The following table presents the total acreage of facilities controlled by each of our major operating subsidiaries as of December 31, 2024: Area (m 2 ) Dalian CBAK Power facilities site area Total 72,810 Nanjing CBAK facility site area Total 27,135 Nanjing BFD facilities site area Total 4,285 Hitrans facilities site area Total 13,772 Shangqiu facilities site area Total 30,000 See also “ Item 1.
We believe that our facilities, including those under construction, meet our current business needs and will meet the needs of our expanded operations in the future. The following tables sets forth the breakdown of our facilities as of December 31, 2023 based on use.
We believe that our facilities, including those under construction, meet our current business needs and will meet the needs of our expanded operations in the future. The following tables sets forth the breakdown of our facilities as of December 31, 2024 based on use.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeDividends paid by our PRC subsidiaries to BAK Asia or BAK Investments, our Hong Kong subsidiaries, will not be subject to Hong Kong capital gains or other income tax under current Hong Kong laws and regulations because they will not be deemed to be assessable income derived from or arising in Hong Kong.
Biggest changeDividends paid by our PRC subsidiaries to BAK Asia, BAK Investments and Hong Kong Hitrans, our Hong Kong subsidiaries, will not be subject to Hong Kong capital gains or other income tax under current Hong Kong laws and regulations because they will not be deemed to be assessable income derived from or arising in Hong Kong.
We currently intend to retain most, if not all, of our available funds and any future earnings to operate and expand our business. As we are a holding company, we rely on dividends paid to us by our subsidiaries in the PRC through our Hong Kong subsidiaries, BAK Asia and BAK Investments.
We currently intend to retain most, if not all, of our available funds and any future earnings to operate and expand our business. As we are a holding company, we rely on dividends paid to us by our subsidiaries in the PRC through our Hong Kong subsidiaries, BAK Asia, BAK Investments and Hong Kong Hitrans.
Recent Sales of Unregistered Securities There were no unregistered sales of equity securities during the 2023 fiscal year that were not previously disclosed in a quarterly report on Form 10-Q or a current report on Form 8-K that was filed during the 2023 fiscal year.
Recent Sales of Unregistered Securities There were no unregistered sales of equity securities during the 2024 fiscal year that were not previously disclosed in a quarterly report on Form 10-Q or a current report on Form 8-K that was filed during the 2024 fiscal year.
Market Information Effective June 21, 2019, the Company’s Common Stock started trading on the Nasdaq Capital Market under the symbol “CBAT.” Approximate Number of Holders of Our Common Stock As of March 14, 2024, there were approximately 54 holders of record of our common stock, which do not include the number of stockholders holding shares of our common stock in “street name.” Dividend Policy We have never declared or paid any dividends, nor do we have any present plan to pay any cash dividends on our common stock in the foreseeable future.
Market Information Effective June 21, 2019, the Company’s Common Stock started trading on the Nasdaq under the symbol “CBAT.” Approximate Number of Holders of Our Common Stock As of March 14, 2025, there were approximately 50 holders of record of our common stock, which do not include the number of stockholders holding shares of our common stock in “street name.” Dividend Policy We have never declared or paid any dividends, nor do we have any present plan to pay any cash dividends on our common stock in the foreseeable future.
Purchases of Equity Securities No repurchases of our common stock were made during the fiscal year of 2023. ITEM 6. [RESERVED] 40
Purchases of Equity Securities No repurchases of our common stock were made during the fiscal year of 2024. ITEM 6. [RESERVED] 43

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeIn 2020, we initiated the construction of our Nanjing facilities, planned in two phases. The Phase I commenced operations in the second half of 2021, covering an area of approximately 27,173 square meters. Since then, we have been steadily increasing its production capacity to 2GWh. Construction of the Phase II began in 2022 and includes three major manufacturing plants.
Biggest changeWe believe that the trial production will commence by May 2025, and the mass production will commence in the second half of 2025. In 2020, we initiated the construction of our Nanjing facilities, planned in two phases. The Phase I commenced operations in the second half of 2021, covering an area of approximately 27,173 square meters.
New revenues derived from the sale of materials used in manufacturing of lithium batteries, through the newly acquired subsidiary, Hitrans, as well as the continuous climb of sales in batteries used in residential energy supply and UPS and light-electric-vehicle related products, contributed to the total increase in net revenues. For more details, see “ Item 1.
New revenues derived from the sale of materials used in manufacturing of lithium batteries, through the acquired subsidiary, Hitrans, as well as the continuous climb of sales in batteries used in residential energy supply and UPS and light-electric-vehicle related products, contributed to our total net revenues. For more details, see “ Item 1.
As of December 31, 2023, our equity interests in Hitrans had reduced to 67.33% (representing 72.99% of paid-up capital) after Hitrans accepted investments from several investors. See “
As of December 31, 2024, our equity interests in Hitrans had reduced to 67.33% (representing 72.99% of paid-up capital) after Hitrans accepted investments from several investors. See “
In addition, our latest development of 32140 battery and our planned investment in the R&D of Series 46 batteries will help us regain competitiveness in both LEV and EV markets with the appropriate products. With the demand for new energy growing, we are confident in our ability to secure additional orders from the expanding market.
In addition, our latest development of Model 32140 and 40135 battery and our planned investment in the R&D of Series 46 batteries will help us regain competitiveness in the energy storage, LEV and EV markets with the appropriate products. With the demand for new energy growing, we are confident in our ability to secure additional orders from the expanding market.
Net revenue from sales of cathode materials and precursors was $71.4 million for the fiscal year ended December 31, 2023, as compared to $154.0 million for fiscal year ended December 31, 2022.
Net revenue from sales of cathode materials and precursors was $40.0 million for the fiscal year ended December 31, 2024, as compared to $71.4 million for fiscal year ended December 31, 2023.
We are confident that our battery segment will continue to improve its profitability as we move forward. 41 In addition, we completed the acquisition of 81.56% of registered equity interests (representing 75.57% of paid-up capital) in Hitrans, a leading developer and manufacturer of NCM precursor and cathode materials in China, in November 2021.
We are confident that our battery segment will continue to improve its profitability as we move forward. 44 We acquired 81.56% of registered equity interests (representing 75.57% of paid-up capital) in Hitrans, a leading developer and manufacturer of NCM precursor and cathode materials in China, in November 2021.
We generated revenues from the manufacture and sale of high-power lithium and sodium batteries as well as raw materials for lithium batteries in the aggregate amounts of $204.4 million and $248.7 million for the fiscal years ended December 31, 2023 and 2022, respectively.
We generated revenues from the manufacture and sale of high-power lithium and sodium batteries as well as raw materials for lithium batteries in the aggregate amounts of $176.6 million and $204.4 million for the fiscal years ended December 31, 2024 and 2023, respectively.
Business—Overview of Our Business .” Specifically, total net revenue from sales of batteries for residential energy supply and uninterruptable supplies was $124.5 million for the fiscal year ended December 31, 2023, as compared to $83.6 million for fiscal year ended December 31, 2022, an increase of $40.9 million, or 49%.
Business—Overview of Our Business .” Specifically, total net revenue from sales of batteries for residential energy supply and uninterruptable supplies was $124.6 million for the fiscal year ended December 31, 2024, as compared to $124.5 million for fiscal year ended December 31, 2023.
We incurred a net loss of $8.5 million and $11.3 million during the fiscal years ended December 31, 2023 and 2022, respectively.
We incurred a net income of $9.6 million and a net loss $8.5 million during the fiscal years ended December 31, 2024 and 2023, respectively.
Currently, we have three production lines in our Dalian manufacturing center, with a total capacity of 2 GWh per year. In Nanjing, our Phase I project has two production lines, capable of producing 2 GWh per year (or 1.7 GWh if one line is used exclusively for sodium battery manufacturing).
Currently, we have three production lines in our Dalian manufacturing center, with a total capacity of 1 GWh per year. In Nanjing, our Phase I project has two production lines, capable of producing 1.3 GWh per year.
In addition, net revenues from sales of batteries for light electric vehicles was $5.6 million for the fiscal year ended December 31, 2023, as compared to $6.4 million for fiscal year ended December 31, 2022, a decrease of $0.1 million, or 13%.
In addition, net revenues from sales of batteries for light electric vehicles was $10.3 million for the fiscal year ended December 31, 2024, as compared to $5.6 million for fiscal year ended December 31, 2023, an increase of $4.7 million, or 84%.
We have two production lines at this leased facility, and the renovation costs were covered by the owner. Additionally, subject to meeting certain criteria, the rental expenses can be offset by the taxes incurred. In addition to our construction efforts, we have also invested in machinery and equipment to expand our production capacity.
Additionally, subject to meeting certain criteria, the rental expenses can be offset by the taxes incurred. In addition to our construction efforts, we have also invested in machinery and equipment to expand our production capacity. Thanks to the booming demand from our clients, our battery segment has successfully returned to profitability since 2023.
Once fully operational with these three new plants, the Nanjing facilities are expected to provide a total capacity of 20 GWh, supporting the growing demand from our customers. In 2023, our client demand for batteries soared, prompting us to rent additional manufacturing space in Shangqiu, Henan, PRC. Our Shangqiu facility has a capacity of 0.5 GWh per year.
In 2023, our client demand for batteries soared, prompting us to rent additional manufacturing space in Shangqiu, Henan, PRC. Our Shangqiu facility has a capacity of 0.5 GWh per year. We have two production lines at this leased facility, and the renovation costs were covered by the owner.
The construction of the ceiling stage for the first of these three plants in Phase II was completed in 2023, and we anticipate it will commence operations in the last quarter of 2024.
Since then, we have been steadily increasing its production capacity to 1.3 GWh. Construction of the Phase II began in 2022 and includes three major manufacturing plants. The construction of the ceiling stage for the first of the three plants in Phase II was successfully completed in 2023.
We completed the construction of a cylindrical power battery manufacturing plant in Dalian, which began commercial production in July 2015. We have successfully integrated most of BAK Tianjin’s operating assets into our Dalian facilities. This includes machinery and equipment for battery and battery pack production, customers, management team, technical staff, as well as patents and technologies.
We completed the construction of a cylindrical power battery manufacturing plant in Dalian, which began commercial production in July 2015. In addition to the Model 26650 batteries manufactured in Dalian, we are procuring equipment for a new production line for a larger-sized cylindrical battery, Model 40135.
Removed
In 2023, we experienced higher demand for our model 26650 lithium-ion batteries than our Dalian facilities could supply. To address this demand, we increased our capacity at both our Dalian manufacturing center and the Phase I project in Nanjing by adding new production lines.
Added
In 2024, demand for our model 26650 lithium-ion batteries, manufactured at our Dalian facilities, has gradually declined, as the model has been on the market since 2006 and is relatively outdated. In contrast, demand for our model 31240, produced at our Nanjing facilities, has exceeded supply.
Removed
Thanks to the booming demand from our clients, our battery segment has successfully returned to profitability in 2023.
Added
To address these shifting demands, we are enhancing our product portfolio at the Dalian manufacturing center by introducing the model 40135. Additionally, we are expanding the capacity of our Nanjing facilities by adding two new production lines as part of Phase II construction.
Added
We are now preparing for equipment installation to stay on track for trial production by May 2025, followed by mass production in the second half of 2025. Once fully operational with these three new plants, the Nanjing facilities are expected to provide a total capacity of approximately 20 GWh, supporting the growing demand from our customers.

Other CBAT 10-K year-over-year comparisons