CBAK Energy Technology (CBAT) 11 Apr 232022 Q4 Earnings call transcript

Good day, ladies and gentlemen. Thank you for standing by, and welcome to CBAK Energy Technology's Fourth Quarter and Full Year 2022 Earnings Conference Call.

Currently, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instructions will follow at that time.

As a reminder, we are recording today's call.

objections, disconnect any this have you you at may time. If

to turn Mr. Investor the I'll Thierry Li, call proceed. Energy. Now, CBAK over Li, of Relations please Director

fourth hello, call. conference to operator, XXXX everyone. you, full year and CBAK Thank Energy's quarter and earnings Welcome

our are our Pei, General Jennifer, interpreter. Chief us Engineer; Mrs. today Chief Officer; Mr. Yunfei and Mr. Joining Financial our Officer; Li, Executive Xiangyu Interim Tian, Xiujun our

website -- earlier of on earlier today. ir.cbak.com.cn, release from press as available IR also this be replay results The the available few is Newswire company's website. IR in We our at will A well as a released services. on hours call

the XXXX. discussion Before contain Safe made forward-looking U.S. we Litigation statements of the Private Act Reform please continue, Securities that of today's will under provisions note Harbor

is statements these risks update inherent results Further be company materially the any uncertainties, expressed the applicable obligation SEC. other from required laws. except such and forward-looking doesn't information under public risks in may The assume to as as today. involve Forward-looking any expectations uncertainties the the company's included different filings regarding with statements, company's actual and and

mentioned Also, U.S. otherwise unless note all the stated, in please call conference are dollars. figures that during

Go call Mr. With in Mr. English. CEO, Li his Li. that, Chinese, translate over will and turn let ahead, me Mr. now into the comments speak our to Yunfei Li. I will

Language] [Foreign

conference call [Interpreted] Thank earnings you, and you today. our hello, everyone. joining Thank for

released just the for and XXXX. have We of report full QX the financial year

has X.X from XXXX million a investors in which revenues. we in achieved remarkable in to proud sales by to the shareholders present times revenue tremendous company's XXXX, are to growth million $XXX is and We our achievement. $XX.XX The have grown

increase clients expanding approximately the battery overseas rapidly. and year-on-year. support remarkable XXXX, the as of In grown million, in success our annual the continuous major $XX.XX to we our segment revenue markets, our reached battery X.XX Thanks has have times achieved well business our a from as trust of

previous not announcements, mentioned orders we from we clients, receiving due could various confidentiality name our reasons. important whom In to some of

fact that satisfaction with of almost increased by services. times long-term the clients However, has our indicates our products trust the revenue and and these X

still conference high of previously I investors In fact, announced industry. will demand we is our provide our order call, from In the on also these Currently, shareholders this amount an new and these in clients to are Nanjing. capacity our update our construction expanding growing. the meet update the in stages I will clients. production on factory actively

awaiting update in total me delivery company. let amount the our orders of Firstly,

XXst $XXX three and located March that company's of revenue of backlog the of orders this As year, main million totaling received future. the in growth Nanjing have support be to approximately delivered. high This yet bases in orders will are production the Shaoxing Dalian,

forecast highly We reasons optimistic to have a performance sales for the in XXXX. hold

fact, why In have our the very actively of some due is are long production demand, capacity. we company's This products a expanding to supply short been time. market for the hot in

and cooling we our heating, customer. a more a European largest and of energy with century we employees renewable history XXXX, from XX,XXX May orders This provider that announced received leading In currently is globally. systems client of over than

million. XX, reached million, amount December their €XX.XX equivalent $XX.XX of XXXX, order As has to

larger XXXX, have orders XXXX. We collaboration in us further orders year. have supply and been in place of due even since since extensive chain talks value after anticipate and that negotiations placed with period they on high this agreed this XXXX, they and client will an We diligence, with

we this the reveal revenue announced chosen identity in the protect order consistent In market, their is order and information, our significant at energy Nevertheless, time. with client our client. to the have not due to the intense amount key new in conviction to from we this increase

when time name the the the right disclose is in will future. We

In fields. vehicle actively LEV light signed also EV XXXX, developing growth to Group company and in a and we customers rapid manufacturer energy addition Jinpeng affiliated the are largest the the In electric world's we Jemmell. its in sector, framework storage the agreement with

December and to $X Jemmell the of been vehicle XX, batteries have market. XXXXX Group time, approximately the of future which Jinpeng placed As worth company's expansion vehicles, is have XXXX, Group's electric Jinpeng same at very orders also to applied in our million, helpful electric the

total the received to increase Jinpeng this orders Our customer from continuing, will the cooperation is expected and Group in future. with it is amount still that continue of

supplied visit a February Besides, to in with this Motor worth had of to the a our Daihatsu Toyota, our team respect paid subsidiary about to our we Daihatsu RMBX.X project factory Motor, line. is Nanjing production year, products under see which million In battery cooperation with from XXXX.

team, future communicated management with visitors about Our collaboration. the our

We to the growing order expect future. see amount continue the in near

significant in has made terms of progress The company customer development.

and internationally when this storage is In maintaining appropriate. The managed business, we electric the XXXX. players addition also in is for several vehicle capital energy stable major major an with partnerships renowned supplying it to products to markets. cooperation we with electric and to to and optimistic light client a form vehicle the in market announce company outlook the the European corresponding will clients, partnership Besides, other order our company amounts maintains

to operation. phase the partnered production XXXX, with first we As successfully demand. in local was line the Nanjing into put mentioned of our company's of end is Nanjing our Nanjing current government in XXXX, project project. In launch earlier, the the high By

We gigawatt the XXXX. second phase. production of have phase the the infrastructure are now framework steel construction we second of XXXX, lines of completed. construction the first to been the started and a Currently, by expect and achieve more phase In X to capacity adding hour production

have XX XXXX complete expect the up the capacity hour to add is which approximately of orders. is another vast to capacity XXXX, believe production to annually the hour. capacity of a company second production the hours phase a expected to and XX of and -- completion customer majority After in achieve the of demands gigawatt we X construction, X We then gigawatt of Dalian to the mature our stage capacity Together first by the of meet construction gigawatt hour by with of phase, second production phase of total Nanjing. that the capacity then gigawatt will base, the

our efforts, R&D we currently On focus batteries. sodium-ion on

Sodium-ion own batteries have their market from China, drawing become interest battery of battery in a lithium have products. leading a firms A highly leading contested few released variety sodium-ion producers.

this the companies solutions batteries, will XXXXX test Our be the company vehicles, beyond. sodium among release given produce By widely then, batteries, expected has sodium-ion sales energy electric of to to potential and completed formal mass sodium-ion and immense in batteries of and XXXXX end with production storage by year. we the earliest worldwide of applied the be product recently light

thus Sodium your in billions the our establish tens future, battery product. and the market near to attention encourage of at of lithium a market. sizable billions shareholders quickly supplement are expected and of a least on to company our dollars hundreds battery investors sodium-ion battery products to RMB, or maintain of becoming of of upcoming our We launch

XXXX, sales. and progress both research company in In has significant development and the made

the has to X.X of the achieve times, Our one Currently, and waiting huge company companies market to will a of sodium become batteries. sales amount the in mass earliest increased delivered. we orders of production revenue by be

clients. are good several customer, and be released information renowned appropriate with the also supplying time. European maintain our a We also relationship to products internationally to we will Relevant at managed major

price raw a about skyrocketed carbonate, the key by profitability. in The of our of XXX%, lithium affects material, XXXX most which

profits quick material each capacity the sufficient quickly. our us reasons our into batteries with new raw of by decrease price The materials price financial to along put producer, raw give that in material us successful use lithium a will increase of declines this decline carbonate be market believe optimistic raw However, year. price unveiling together performance of the help XXXX. and of We sodium development about

over to Xiangyu Now, let turn who details provide Pei, interim will financial the me on CFO, our performance. our call

Thank thank call and our Okay. for Mr. you, joining you, today. everyone, Li,

key results XXXX. now the fourth for will of quarter financial our go I full and year over the

refer earnings to release. our our For the press details results, full of financial please

to momentum increase battery sales We material our products. in of maintain a and battery continued strong the of

Mr. with invest by of in price this clients the big to future however, year, As of declining materials Li, confident materials are we growth raw need our Difficulty], expand and of and the cost mentioned and in high orders in making [Technical our profits. raw very

expenses long be deliver administrative general our cylindrical the XXXX, revenues profit and lithium We battery our increase in large helpful reduce to our slightly and strategies. and battery grew, To and and both we the our to In to gross revenues reflecting financial successful our reduce expenses. better managed marketing a sodium results. sales investments run Meanwhile, sales related expenses the will marketing while in and products. increased new development develop to our of research significantly

XX.X% Moving million $XX.X the same by net full our our contributed our revenues fourth factors. to from XXX% In the our by significant quarter, by was to XXXX. the revenues on $XXX.X year, period In to results. grew The million. growth of in revenues net surged several

in product improved vehicles market demand to and manufacturers. EV more products. for XXXX, downspeed Besides features which increase First, on electric the has grow the EV in to for market, quality, become continued attractive battery our EV higher leading an to

demand, huge sell On successfully the more manufacturers. to a batteries LEV market, increase we market LEV in thanks to

LEV accepted markets, by have key cylindrical to leading the large our significant batteries and players importantly, in More lithium been EV battery growth. the XXXXX gradually

storage products. the be On and power for demand in a in sales reliable batteries energy including XXXX for of supplies increase growing renewable attributed can the development of sources to market, energy our factors, of interruptible combination

and develop has competitive products pricing. energy our a development Additionally, research and allowed to storage on at reliable focus us innovative

the in in expect our continued a to As we we to energy sales. remain see offerings, improve storage invest and growth leader industry product R&D in continue and

the revenues up the of million fourth year. was from in quarter, period in by previous Cost the $XX.X same XX%

with increase $XXX.X for by XXX.X% was revenues XXXX. line the in revenues cost of cost our revenue. Our of from of in XXXX The million, net was increase up

year. gross of for XXXX. same increase for increased same this an increase period from Gross increase prior raw due quarter, the Along representing fourth decline margin was quarter the slightly and $X.XX Gross XXXX -- X.X% XXX% to from raw will margin was of material XXXX. X.XX% profit profit with materials X.X% XXXX $XX.X of was profit of margin in XXXX, XXXX, gross the year. period price in in the year. recover XXX.X% fourth the Our X.X% price million, compared our profit in with in an representing increase in for from battery of the million from and and Gross largely

and million $XX.X due primarily the was impairment investments increase to The operating expenses efforts, $XX in land Our as by our and million research well rose hedges, and commitment quarter in on in as our XX.X% for XX.X% equipment increase XXXX property, goodwill. charge expenses fourth and XXXX. for to to the operating development to

the working out to only the by Even Within to for expenses that, $X.XX X.X% of same our million XXXX. and XX.X% XXXX. fourth research XXXX to in XX.X% for XX.X% XXXX; the and for million marketing in decreased our in $XX.X of investments occurrence for and and and and million XX.XX% administration fourth to XXXX; $X.X increase development million period by relative by $X.X to for revenues quarter expenses impairment expenses to XX.X% decreased charges, sales by increased $X by other million R&D expenses compared with XXX.X% general quarter, with the and operating the

loss same loss in was period Our fourth reduced the XXXX. XXXX from the was from in increased $X.X $XX.X $XX.X X.X% by Operating million quarter in operating of million, XXXX. million, by XX.X%

net XXXX fourth attributable to $XX.XX of shareholders income shareholders Energy of attributable warrants CBAK change The compared shareholders in of CBAK of was XXXX. income of $X XXXX Energy the $X.X was XXXX. quarter to value million year. we of million for Thus, for net Energy change to $XX.X loss to from in $X.XX $X.XX million. of by attributable million million, net to Our fourth same the loss the of CBAK fair million to million $XX net fair quarter in XX% recorded of a warrants value period attributable in prior in for compared shareholders to The was decreased compared

concludes That prepared our remarks.

now Let's go Operator, the please open questions. ahead. call for

you. Thank

the from Please We will Xiao] question of from your (ph) the IBM. now question-and-answer Tian. [Operator [Tian comes begin session. Instructions] First ask question, line

[Foreign Language]

XXXX? in revenue, am see from from noticed first profit. that IBM. the the to the losses The the this cost in management glad So us more control [Interpreted] details company there prices, in company's rapid also also company you to do production in give its has of significant is be I growth you mentioned able been raw that regard? will and decrease think material I've the suffered Can and a some question

Language] [Foreign

decline key our the fluctuation you report in in question. margin And due company your input our of to that XXXX. of our witnessed materials our to in see a we the compared lithium that to the in at on is lot a look the thank of other according XXXX made have if we operation R&D. And we carbonate, So, can a expenses increased gross now, the company, the product, one figure raw for just in we [Interpreted] hand, price of our the

XXXX, the amounted so in as In double lead to of our industry. that our in the the in to maintain profit. continuous R&D input amount in our the leading products to high-quality XXXX. in a it's a And in It's than future, this reduction be position battery And almost investment sector R&D to the still million. $XXX.X will of we committed more -- also

hand, been optimization reduce of production we to to have in production to so committed management efficiency. structure make the improve improving with the the also processes efforts an On as in we the cost. operation other addition, And aim the our our

operations specific at by our have look X.X%. extent And the increase. a XXXX, revenue have to you shrinked some loss, realized So, a look the if we figures of X.X-fold it a actually if of at

at further also to believe will the price with level raw management we it. So, look our material our structure, optimization and if of have returning that with That's XXXX a the be we profitability increased. a of normal

Language] [Foreign

I thank for sorry, you have you and another I Thank and -- for have your answer, your Okay. question, question. [Interpreted]

leading of an Is you currently update through the market can in market? sodium the Just Can company its Thank now spoke scenarios application the of give batteries? the sodium sodium on senior walk a in battery. management In the you us Chinese and popularity in size particular, us you. position battery?

[Foreign Language]

Okay. [Interpreted]

good very a is question. this So,

past it the of all, in all markets. fluctuation to market. the we impact because a question price I'd the and fluctuated exerted the the its that noticed multi lithium-ion In like negative years. the three in mainly of fold Chinese It kind past popularity battery of of the the First answer about sodium battery lot, years, this in is three the -- in And price increased fluctuation a actually, lithium carbonate. of of in

that the better it enjoys sodium more accessibility. and that, easier have battery, on to it condition. battery one vehicles, superior will the the a product However, other -- be winter low, that is its in even a assess, stable if at a And also we price; is low it look better that temperature to a in hand, its besides the on in is in low say can used hand, it performance is especially good than lithium has we performance be when makes temperature temperature the condition

popularity and future. that So, sodium given the the in the the of believe market price, the will price low we battery even grow in in stability

And size creates -- lithium expect dollar in also, of billions in the decline sodium market to of the expect battery for further in for hand another the will opportunity in hand, we So, on And expand market the battery. we future. another addition, market popularity sodium a battery.

coming and vehicles. will and more production already if cooperated XXXXX. about to going while have to use the per the status this our products, as vehicle, And products have more promote them come of and this in projects, is we we with on the put finished such And we're sodium sodium watts mass And partner our the latter that in me you of and of battery have and ask three one, we XXX kilogram. product development development XXXXX already battery company, already the generations in for have we future the the with up

That's Thank for your the you it again. question answer. for

a All line follow-up right, question, from Xiao. of ask thank you. [Operator have your Please Instructions] We the Tian. question Tian

Language] [Foreign

Okay. questions. still] [Interpreted] (ph). [answering Thank for I two have another you

revenue business, the company in after company's rapidly of growth the to And storage from one, put LEV continuing LEV the especially mass and both experienced will comes future, and EV significant the revenue into production? battery still is most grow sodium EV since has first The sector. in energy

Language] [Foreign

Okay. The goes Mr. Li. to question [Interpreted]

[Foreign Language]

Yes. Okay. [Interpreted]

-- yes, So you're right.

-- energy of the You sales you energy is -- revenue, is the at the a mentioned behind the reason comes from are -- it? storage. If have that our Dalian most And in revenue does products here that and products proportion. manufactured in the a is look what that storage of sales right, up product take XXXXX the plant, large you're XXXXX,

and last facility, been look XXXXX, However, if hasn't until have is product plant the that a it mass produce this the Nanjing we mainly at year. produced

A doing certification the at still OEM are the of companies lot moment.

sales amounted to have our $XX already However, million already.

pass at the after certification, vehicle better production the believe let's meet and with production we this of they and us. order year, and of -- So say after customers our increase capacity, half will of our will second more the place demands the manufacturers the that capacity

EV better LEV the half customers So, supply we year. and the second in will our of

the So, LEV LEV of in reason markets continue the will sales we the EV have and volume to EV to grow. and believe

to And well, if sodium our business you production, priority year believe to that in put will to And mass do the into put customer more help and production, is will this also products samples will for of we put year, then, pass them be production, vehicles. impact our they and and of when send certification. talk next of about the we and into be R&D our battery the the

So that's the answer to question number three.

right? have another said you You question,

Language] [Foreign

can that be company the that calls, is batteries. development about larger any there cylindrical conference the investors? shared several [Interpreted] Is previous it progress Yes, developing in the mentioned information with

Language] [Foreign

the in efforts in development the years, series. the doubled large especially our have two doubling [Interpreted] been we cylindrical of batteries, Yes, XXth past indeed, --

prototype finished that are have trial design B a the we the and -- near in and the test then, the developing future. that in put And prototype already terms production now of and finished mass indicate -- already And design process. be we the expect have this shakedown have And process of test. now -- we then, the can it the finished we in We prototype trial mode production development, objective. results -- and will reach the manufacturing into

household then, two -- were for volts we also for very other of developing this the XX be time, golden will believe suitable the the would I size products we two those big price superior sites have golden XXX. XXX. in And at for products these share been performance This most energy that be series, at dimension a household to also better types present -- that storage. energy products there storage is seems under XX with is -- and for products It ratio. present. And same example, a market a other than the and will

So, will that great believe this future. a we a product enjoy -- promising

you. answer. for it That's the Thank

[Foreign Language]

[Interpreted] Okay.

for finished Thanks have my questions. answers. I Now all a the lot

Thank you.

question next eSeis] Cole ask Please your line (ph). from comes Our question, [Steve Steve. from of the

to revenue Now, growth. congratulations immense your

cash Regarding negative in if the come believe cost you past there does issues near be future in the revenue the do years, flow serious liabilities the the down? of and current not liquidity ever will

[Foreign Language]

from question. this two We thank So, can for you question dimensions. [Interpreted] your answer

business booked sufficiently year cash we the the the and according existing look production is can revenue say, business last we have we capacity battery calculation, First our our flow, this All year, and with carried the by material is of to at the the the cash operation -- sufficient. can actually, out and Both support the can business cash -- sufficient. both have cash the product flow. results our flow by our a brought we brought all, -- of by if calculation

expansion -- our a other the actually we production revenue And different on sources. of then, support if hand, look if have capacity, coming we financial from some have the at of

in in the production we interest secondly, And in capital both investors in lot first in. we us The support from U.S. market, have some local government. believe us the in support thirdly, products, give of They their overseas them one facilities where domestic talks banks give policy again in the having Actually, is based And local from sorry, investors are we financial also support and great the us. and support finance. our -- China. government supplies also our now incentives to we and great the gained -- with expressed they a are can

Thank the question your it you again. answer. That's for for

Thank the you. right. question? any All All no do follow-up queue. Steve, [Operator you Instructions] Thank Seeing right. in have you. questions further

Let Yunfei to back the for Li call closing remarks. me turn Mr.

Language] [Foreign

[Interpreted] Thank progress. interest, and and thank all reporting appreciate look for and your call We today's you the our support. quarter you, you on forward for to to participating next on again operator,

the call. you again. concludes Thank all This

may disconnect. You now