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CBAK Energy Technology , Inc. InvestorRoom CBAK Energy Reports Second Quarter and First Half 2021 Unaudited Financial Results --Net Revenues up 27 % year over year in the second quarter and up 33 % year over year in the first half-- --Well positioned for future growth-- DALIAN , China , Aug. 16 , 2021 / PRNewswire / -- CBAK Energy Technology , Inc. ( NASDAQ : CBAT ) ( " CBAK Energy , " or the " Company " ) a leading lithium - ion battery manufacturer and electric energy solution provider in China , today reported its unaudited financial results for the second quarter and first half year ended June 30 , 2021 . Second Quarter 2021 Financial Highlights • Net revenues were $ 5.9 million , an increase of 27 % from $ 4.6 million in the same period of 2020 . • Gross profit was $ 1.1 million , an increase of 1,148 % from $ 0.1 million in the same period of 2020 . • Gross margin was 18.6 % , an increase of 16.7 percentage points from the same period of 2020 . • Net Income was $ 2.7 million , compared to net loss of $ 1.2 million in the same period of 2020 . First Half 2021 Financial Highlights • Net revenues were $ 15.3 million , an increase of 33 % from $ 11.5 million in the same period of 2020 . • Gross profit was $ 2.9 million , an increase of 899 % from $ 0.3 million in the same period of 2020 . • Gross margin was 19.2 % , an increase of 16.6 percentage points from the same period of 2020 . • Net Income was $ 32.3 million , compared to net loss of $ 3.6 million in the same period of 2020 . Yunfei Li , Chairman and Chief Executive Officer of the Company , noted : " We achieved strong second quarter and first half year financial results . Net revenues grew 27 % and 33 % year over year respectively , and our gross margin improved significantly . The overall demand for our high quality , dependable battery products continued to be strong . To meet rising customer demand , we invested to expand production capacity in our Nanjing and Dalian plants . The Phase I project in Nanjing and the new production line in Dalian are expected to commence production in the second half of the year . At the same time , we also accelerated R & D for new products and solutions , such as batteries for ultra - low temperature applications and batteries for uninterruptable power supplies . " Mr. Li continued : " Our strategy is to become an innovative lithium - ion battery provider in a fast - growing market that is embracing clean energy . We are actively integrating and consolidating the supply chain to create a more efficient ecosystem . Our recent announcement to acquire Zhejiang Meidu Hitrans Lithium Battery Technology Co. is a critical strategic move , and we are confident we can deliver rapid growth for our business . " Xiangyu Pei , Interim Chief Financial Officer of the Company , noted : " We generated net revenues of $ 5.9 million in the second quarter and $ 15.3 million in first half year . Our gross margins were 18.6 % in the second quarter and 19.2 % in the first half year , representing significant improvements year over year driven by higher capacity utilization . We raised $ 70 million in February that provides good liquidity to support our production expansion and investments in new product launches . Looking ahead , we are on the right path for accelerated growth . " First Half 2021 Business Highlights & Recent Developments • In July , the Company announced it will acquire 81.56 % of equity interests in Zhejiang Meidu Hitrans Lithium Battery Technology Co. , a leading developer and manufacturer of ternary precursor and cathode materials in China . This acquisition aims to integrate a supply chain of critical raw materials to the Company's portfolio to support future expansion . • In February , the Company announced production capacity expansion at the Nanjing and Dalian plants in anticipation of increasing customer orders . For the Nanjing plant Phase I project , the Company plans to invest RMB70 million to develop a production line with an annual capacity of 0.7 GWh . The plant will start operating in the second half of 2021 to produce 50,000 model 32140 batteries per day . For the Dalian plant , the Company plans to invest RMB50 million to add another production line with an annual capacity of 0.4 GWh to produce an additional 100,000 model 26650 batteries per day . • In February , the Company completed a direct offering of $ 70 million to fund its business expansion plan , repay outstanding debt , and to fund additional working capital needs . • In February , the Company announced that it developed the model 26650 battery for ultra - low temperature applications and delivered satisfactory test performance results . This new battery is designed to operate in temperatures as low as minus 40 to minus 50 degrees Celsius and can discharge at a maximum C - rate of 60C at room temperature . • In January , the Company announced a cooperation agreement with Chengdu Raja New Energy Automotive Technology Co. , Ltd. to jointly develop a battery swapping project for the food delivery and logistics industries as well as an uninterruptible power supply ( " UPS " ) project for traffic lights . Second Quarter 2021 Financial Results Net revenues were $ 5.9 million , an increase of 27 % from $ 4.6 million in the same period of 2020. This was mainly attributable to the 29 % increase in net revenues from sales of batteries for uninterruptable supplies from the same period of 2020. As we continue to increase our focus on this market , sale of batteries for uninterruptable power supplies have grown significantly . % Change ΥΟΥ Net Revenues by End - product Applications ( $ thousands ) 2021 Second Quarter 2020 Second Quarter High power lithium batteries used in : Uninterruptable supplies $ 5,812 $ 4,503 Light electric vehicles Electric vehicles Raw materials used in lithium batteries Total 75 0 2 3 29 2,400 119 NM 0 $ 5,889 $ 4,625 NM 27 Cost of revenues was $ 4.8 million , an increase of 6 % from $ 4.5 million in the same period of 2020. This was mainly attributable to the increase in sales volume . Gross profit was $ 1.1 million , an increase of 1148 % from $ 0.1 million in the same period of 2020. Gross margin was 18.6 % , an increase of 16.7 percentage points from the same period of 2020. The improvement in gross margin was mainly attributable to the decrease in unit manufacturing cost because of higher utilization rate and optimization of manufacturing engineering . Total operating expenses were $ 3.8 million , an increase of 283 % from $ 1.0 million in the same period of 2020. Most of the increase in all expense categories was due to growing headcount and expiration of the Chinese government's COVID - 19 relief policy , which had reduced social insurance contributions during the pandemic . • Research and development expenses were $ 1.0 million , an increase of 171 % from $ 0.4 million in the same period of 2020. Design and development expenses relating to light electric vehicles contributed to the increase . • Sales and marketing expenses were $ 0.5 million , an increase of 435 % from $ 0.1 million in the same period of 2020. Entering the LEV market with our new products resulted in an increase in sales and marketing expenses .