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CE

CBAK Energy Technology, Inc. (CBAT)·Q4 2024 Earnings Summary

Executive Summary

  • FY 2024 delivered a sharp turnaround to profitability at the consolidated level (net income attributable to shareholders $11.79M; diluted EPS $0.13), powered by battery-segment margin expansion, but Q4 itself was weak with a consolidated net loss as Hitrans’ raw materials unit weighed on results .
  • Battery business gross margin expanded to 31.5% for FY 2024 (+7.7ppt YoY), with net income rising 39% to $19.43M; residential energy and LEV demand were resilient, while EV revenues fell YoY .
  • Management accelerated capacity plans: Nanjing Phase II adds ~3 GWh in 2025; Dalian upgrades to launch 40135 cells (~2.3 GWh) by end-2025; total cylindrical-cell capacity expected to reach ~7.6 GWh by end-2025, with overseas production targeted for 2026 to mitigate tariffs .
  • Wall Street consensus from S&P Global was unavailable for Q4/FY comparison; investors should focus on margin durability, capacity ramp execution, and tariff/geopolitical navigation as near-term stock catalysts .

What Went Well and What Went Wrong

What Went Well

  • Battery segment margins and profits inflected: gross margin 31.5% (+7.7ppt YoY) and net income $19.43M (+39%), with CEO highlighting performance “ahead of many competitors” and strong 32140 demand exceeding supply .
  • Consolidated turnaround: FY gross margin improved to 23.7% (+8.2ppt YoY) and net income attributable to shareholders reached $11.79M, reversing FY 2023 loss; CFO emphasized battery segment robustness despite lower consolidated revenues .
  • Capacity and product roadmap: commissioning two new 32140 lines (~3 GWh) in Nanjing by late-2025; Dalian upgrade to 40135 adds ~2.3 GWh; management expects substantial revenue growth from 2026 on ramp-up .

What Went Wrong

  • Q4 softness: derived consolidated Q4 net revenues ~$25.37M and operating loss ~$6.59M; consolidated net loss attributable to shareholders ~-$4.51M, reflecting Hitrans weakness and seasonal/mix factors .
  • Segment mix pressure: EV battery revenues fell 41.7% YoY in FY 2024 to $1.68M, and Q3 energy storage revenue was down 25% YoY amid a planned Dalian maintenance shutdown impacting throughput .
  • Geopolitical/tariff headwinds: customers pushing for overseas manufacturing; management cautioned on tariff risk and macro softness at end-applications, with Hitrans industry in downturn and no new investments planned there .

Financial Results

Consolidated Quarterly Trends (Q2 → Q3 → Q4 2024)

MetricQ2 2024Q3 2024Q4 2024 (derived)
Net Revenues ($USD)$47,793,045 $44,628,241 $25,370,891
Cost of Revenues ($USD)$35,065,019 $37,673,684 $22,059,276
Gross Profit ($USD)$12,728,026 $6,954,557 $3,311,615
Gross Margin (%)26.6% 15.6% 13.1%
Operating Income (Loss) ($USD)$5,947,480 $(827,873) $(6,594,441)
Net Income (Loss) ($USD)$6,023,185 $(685,539) $(5,324,970)
Net Income Attributable to Shareholders ($USD)$6,445,462 $17,647 $(4,509,527)
Diluted EPS ($)$0.07 $0.00 Not disclosed (see Estimates Context)

Note: Q4 figures are derived from FY minus nine months; EPS for Q4 is not disclosed in filings .

Consolidated Full-Year Comparison

MetricFY 2023FY 2024
Net Revenues ($USD)$204,438,365 $176,614,609
Gross Profit ($USD)$31,724,323 $41,775,245
Gross Margin (%)15.5% 23.7%
Operating Income (Loss) ($USD)$(7,251,812) $8,788,149
Net Income (Loss) ($USD)$(8,539,327) $9,585,150
Net Income Attributable to Shareholders ($USD)$(2,449,057) $11,790,032
Diluted EPS ($)$(0.03) $0.13

Battery Business Segment (Applications) – FY 2023 vs FY 2024

ApplicationFY 2023 Net Revenues ($USD)FY 2024 Net Revenues ($USD)YoY Change
Electric Vehicles$2,883,385 $1,681,651 -41.7%
Light Electric Vehicles$5,607,435 $10,319,176 +84.0%
Residential Energy Supply & UPS$124,502,698 $124,587,976 +0.1%
Total Battery Net Revenues$132,993,518 $136,588,803 +2.7%
Battery Gross Profit ($USD)$31,580,168 $43,052,991 +36.3%
Battery Gross Margin (%)23.75% 31.5% +7.7ppt
Battery Net Income ($USD)$13,962,215 $19,430,769 +39.2%

KPIs

KPIValuePeriod
Battery Segment Gross Margin (%)31.5% FY 2024
Consolidated Gross Margin (%)23.7% FY 2024
Orders Backlog (Dalian + Nanjing)~$17.54M (RMB 126.96M) As of Mar 10, 2025
Key Client Order – PowerOAK~$12.03M (RMB 87.05M) As of Mar 10, 2025
Key Client Order – Viessmann~$233M (EUR 213M) As of Nov 12, 2024
Key Client Order – Jinpeng~$10.44M (RMB 75.55M) As of Mar 10, 2025
Key Client Orders – Anker~$51.82M (RMB 448M); separate 2024 orders ~$30–35M 2024 / cumulative

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
Nanjing Phase II capacity (32140/40135)Late 2025Add 2.5–3 GWh by next year ~3 GWh with trial by May 2025; mass production late 2025 Raised/clarified timeline and capacity
Dalian 40135 capacity additionEnd-2025Not previously quantified~2.3 GWh added via 40135 line New quantified guidance
Total cylindrical cell capacityEnd-2025Not previously quantified~7.6 GWh total (1.0 GWh 26650/26700; 1.3 GWh 32140 + +3.0 GWh; +2.3 GWh 40135) New quantified guidance
Overseas factory supply commencement2026Exploring overseas options Supply to major customers targeted by 2026 Formalized timeline

Earnings Call Themes & Trends

TopicPrevious Mentions (Q2 2024)Previous Mentions (Q3 2024)Current Period (Q4 2024)Trend
Product roadmap (32140/40135)Fast-charging 32140 announced; 40135 development advancing Nanjing Phase II for 32140/40135; tablet 26650 introduced 40135 line planned at Dalian; 32140 capacity expansion Execution progressing
Supply chain & tariffsNoted geopolitical risks broadly Customers pushing overseas capacity consideration Overseas facility targeted for 2026 to mitigate tariffs Intensifying focus
Segment mix (LEV/RES/EV)RES/UPS dominant; LEV growth emerging LEV demand up in SE Asia; RES down YoY in Q3 LEV strong; EV weak; RES steady FY Mixed; LEV up, EV down
Orders/backlogBacklog ~$57M as of Aug 1 (all facilities) Capacity fully booked at Nanjing Backlog ~$17.54M; major clients’ cumulative orders detailed Bookings remain robust
R&D execution40135 specs: +500–600% capacity vs 26650; tab/full-tab designs Tablet 26650 25C; 15-min fast charge Portfolio overview; 40135 to broaden storage/portable power Continuous innovation
Hitrans/raw materialsIndependent, incurring losses Still weighing on consolidated results Industry downturn; no new investments planned Persistent headwind

Management Commentary

  • CEO: “Gross profit for our battery segment… US$43.05 million… gross profit margin… 31.5%… net income… $19.43 million… surpass those of many industry competitors… demand for our Model 32140 exceeding supply… actively expanding production capacity” .
  • CFO: “Consolidated… turnaround—from a net loss in 2023 to net income attributable… US$11.79 million… decline in consolidated net revenues… primarily due to… Hitrans… gross profit margin of 23.65%… having fully met all financial obligations to Hitrans… its financial performance does not materially impact our business [battery segment]” .
  • CEO (Q4 call): commissioning 2 new 32140 lines in Nanjing (~3 GWh) and upgrading Dalian to 40135 (~2.3 GWh) with substantial revenue growth expected starting 2026 .
  • CFO (Q4 call): overseas capacity targeted by 2026 to address tariffs; customers willing to place substantial orders with higher prepayments; Hitrans industry downturn and no new investments .

Q&A Highlights

  • Equipment terms and implementation: Suppliers offering more favorable payment schedules; equipment already in transit; decision pending on relocation to overseas factory vs new equipment .
  • Macro/tariffs: Customers less focused on macro but concerned about tariffs/geopolitics; management being “pushed” to set up overseas factory to avoid tariffs .
  • Hitrans strategy: No further investments; segment remains independent and continues to weigh on consolidated results .
  • LEV demand geography: Strength in India, Vietnam, Indonesia, with reliance on Chinese cell imports; CBAT positioned with stable products .
  • Maintenance/line shutdown cadence: Dalian Q3 suspension for optimization and upgrade to tablet 26650; planned and driven by market trends and energy-cost optimization .

Estimates Context

  • S&P Global consensus estimates for Q4 and FY 2024 were unavailable due to data access limitations. As a result, beats/misses vs consensus cannot be assessed in this report; investors should monitor subsequent consensus updates post-publication [GetEstimates error].
  • Without consensus, focus on actual margin durability (battery GM 31.5% for FY) and Q4 sequential declines driven by Hitrans and maintenance impacts to gauge likely estimate revisions .

Key Takeaways for Investors

  • Margin-led battery segment strength is intact; the core business remains profitable with FY battery GM 31.5% and net income $19.43M, suggesting resilience even in industry downturns .
  • Q4 consolidated loss underscores exposure to Hitrans/raw materials volatility; near-term stock reactions likely hinge on clarity of Hitrans strategy and segment separation dynamics .
  • Execution on capacity ramps (Nanjing Phase II, Dalian 40135) and achieving ~7.6 GWh by end-2025 are critical operational catalysts for 2026 revenue inflection .
  • Overseas manufacturing by 2026 to mitigate tariffs could unlock larger, pre-paid orders from key global customers; watch for formal agreements and site selection .
  • LEV and portable/home storage demand are structural growth drivers; EV remains a small, currently declining revenue stream—mix shifts favor storage/LEV economics .
  • Absent consensus data, traders should track sequential quarterly trends: Q2→Q3→Q4 showed revenue compression and margin normalization; any rebound in Q1/Q2 2025 will be stock-positive .
  • Non-GAAP clarity matters: management frequently references “after deducting change in fair value of warrants” for net income; ensure comparisons use consistent bases .