LINK TO ABAT's Internal Audit for 2011 and 2012-- Click Here
ADVANCED BATTERY TECHNOLOGIES, INC. Limited Financial Report for 2012时间:2013-05-14 17:19 点击:2048次
To: Board of directors and shareholders:
We have prepared consolidated financial statements for the three subsidiaries of ABAT that carry on production operations in China: Harbin Zhongqiang Power-tech Co., Ltd., Wuxi Angell Autocycle Co., Ltd. and Dongguan Qiangqiang Amperex Technologies Co., Ltd. These financial statements do not include our US office, our representative office in Beijing, or our holding company subsidiaries: Hong Kong Cashtech Investment Limited and Cashtech Investment Limited, a British Virgin Islands corporation. As you review the financial information in this report, please bear in mind:
· The financial statements were prepared in accordance with the enterprise financial accounting rules generally accepted in China. Preparation of the financial statements, particularly the balance sheet, in accordance with U.S. GAAP could result in significant changes.
· We converted from Renminbi to Dollars based on the Bank of China exchange rates as of December 31, 2012 and December 31, 2011.
· No independent auditor has reviewed these financial statements. Only our employees participated in the preparation and review of this information.
Item1. Business
The production and sales operations of ABAT are carried out by three subsidiaries based in China:
· Harbin Zhongqiang Power-tech Co., Ltd. Located in the Province of Heilongjiang, in the Economy & High-Tech Development Zone of Shuangcheng City, Harbin ZQPT is engaged in polymer lithium ion battery research and development, manufacture and sales. Harbin ZQPT holds the government lease of the real property on which we have built a complete facility for the production of batteries. Harbin ZQPT has a unique production technology, which is protected by seven independent intellectual property rights in China and the United States. Its products are used in the electronics industry, as well as the energy storage industry and the electric transportation industry. The company has passed ISO9001 quality management certification and CE product safety certification. Its products are sold in mainland China and indirectly exported throughout the world.
· Wuxi Angell Autocycle Co., Ltd. Wuxi ZQ is a Chinese limited liability company that Cashtech Investment Limited acquired in May 2009. Located in the Wuxi New District, in Jiangsu Province, China, the facilities of Wuxi ZQ total 85,000 square meters, including approximately 40,000 square meters of manufacturing facilities. Wuxi ZQ is engaged in the business of manufacturing and distributing light electric vehicles (LEV). Wuxi ZQ has multiple modern assembly production lines and electric vehicle parts production lines. Its intellectual property includes more than 20 national independent intellectual property rights. Wuxi ZQ operates pursuant to a Chinese electric bicycle production license issued by the Bureau of Technical Supervision. The company has passed the ISO9001 quality certification and the European Union EEC certification. Its products are sold in mainland China and in more than forty countries worldwide.
· Dongguan Qiangqiang Amperex Technologies Co., Ltd. Early in 2011, in order to expand our production of batteries to meet the market demand, we registered Dongguan Qiangqiang with the government, purchased the assets of Shenzhen ZQPT Co., Ltd., and purchased a parcel of land and factory buildings in Qingxi Town, Dongguan City, Guangdong Province, China. During 2011 we renovated the facilities, laid out the production lines, acquired the production equipment, and expanded the electric power production capacity at that site by installation of a 12,500 KVA substation. We then integrated the assets and business of Shenzhen ZQPT into the Dongguan facility. Dongguan Qiangqiang now boasts advanced production technology and equipment, with a production capacity of 500,000 aluminum shell battery cells and 70,000 ampere hour polymer lithium ion battery cells per day. The Dongguan Qiangqiang facilities measure 59,000 square meters, including 53,000 square meters of production space. The overall plant is divided into four sections: production area, office area, a battery research and development center, and an employee living area. Production at the Dongguan Qiangqiang facility now represents one-third of our company’s total production.
Item 2. Results of Operations
The consolidated financial results of our three operating subsidiaries for 2012 and 2011 are summarized in the following table:
(in thousands of dollars - $000)
2012 2011 % Change
Revenue(1) $ 135,694 $ 125,470 8.14%
Cost of revenue(2) 84,325 72,888 15.69%
Gross margin 37.16% 41.22% -4.06%
Research & development 2,457 1,461 68.13%
Operating expenses - other 4,857 3,931 23.57%
Income tax 10,721 11,475 (6.57%)
Net income$ 32,167$ 34,346 (6.34%)
_______________________________
(1) The contributions of our product lines to 2012 revenue was:
Batteries - small capacity29.3%Batteries - medium capacity9.8%Batteries - large capacity12.8%Miners lamps8.2%Light Electric vehicles40.0%(2) The primary reason for the disproportionate increase in the cost of revenue was the increase in labor costs in China.
Item 3. Assets
The primary assets of our three operating subsidiaries as of December 31, 2012 are included in the following table:
Cash and cash equivalents $ 7,425,400
Accounts receivable(1) 39,410,900
Inventory(2) 24,520,900
Property & equipment(3) 87,219,000
Construction in progress(4) 75,850,900
Intangible assets(5) 20,708,500
Total assets(6) $ 328,984,600
(1) Our accounts receivable balance increased during 2012. However, no receivable is more than six months old, and all are expected to be collected.
(2) Inventory includes raw materials - $13,828,500, work-in-progress - $5,046,500, finished goods - $5,646,000.
(3) Property & equipment increased by 75.44% during 2012.
(4) The locations of construction in progress were Donguan Qiangqiang - 54.90%, Harbin ZQPT - 27.79%, Wuxi ZQPT - 17.31%.
(5) Intangible assets increased by 137.11% during 2012, primarily related to the development of Dongguan Qiangqiang.
(6) Represents an increase of 26.2% since December 31, 2011.
Item 4. Liabilities
The primary liabilities of our three operating subsidiaries as of December 31, 2012 are included in the following table:
Accounts payable (1) $ 9,538,000
Short-term loans(2) 9,221,000
Long-term loans(3) 7,477,500
Total liabilities(4) $ 53,659,000
________________________
(1) Accounts payable was comprised primarily of debts to raw material suppliers.
(2) Short-term loans included a bank loan to Wuxi ZQPT of $4,769,500 and a bank loan to Harbin ZQPT of $4,451,500.
(3) Represents a five year bank loan to Dongguan Qiangqiang.
(4) Total liabilities decreased by 1.30% during 2012.
Management of ABAT
5.8.2013
ADVANCED BATTERY TECHNOLOGIES, INC. Limited Financial Report for 2012时间:2013-05-14 17:19 点击:2048次
To: Board of directors and shareholders:
We have prepared consolidated financial statements for the three subsidiaries of ABAT that carry on production operations in China: Harbin Zhongqiang Power-tech Co., Ltd., Wuxi Angell Autocycle Co., Ltd. and Dongguan Qiangqiang Amperex Technologies Co., Ltd. These financial statements do not include our US office, our representative office in Beijing, or our holding company subsidiaries: Hong Kong Cashtech Investment Limited and Cashtech Investment Limited, a British Virgin Islands corporation. As you review the financial information in this report, please bear in mind:
· The financial statements were prepared in accordance with the enterprise financial accounting rules generally accepted in China. Preparation of the financial statements, particularly the balance sheet, in accordance with U.S. GAAP could result in significant changes.
· We converted from Renminbi to Dollars based on the Bank of China exchange rates as of December 31, 2012 and December 31, 2011.
· No independent auditor has reviewed these financial statements. Only our employees participated in the preparation and review of this information.
Item1. Business
The production and sales operations of ABAT are carried out by three subsidiaries based in China:
· Harbin Zhongqiang Power-tech Co., Ltd. Located in the Province of Heilongjiang, in the Economy & High-Tech Development Zone of Shuangcheng City, Harbin ZQPT is engaged in polymer lithium ion battery research and development, manufacture and sales. Harbin ZQPT holds the government lease of the real property on which we have built a complete facility for the production of batteries. Harbin ZQPT has a unique production technology, which is protected by seven independent intellectual property rights in China and the United States. Its products are used in the electronics industry, as well as the energy storage industry and the electric transportation industry. The company has passed ISO9001 quality management certification and CE product safety certification. Its products are sold in mainland China and indirectly exported throughout the world.
· Wuxi Angell Autocycle Co., Ltd. Wuxi ZQ is a Chinese limited liability company that Cashtech Investment Limited acquired in May 2009. Located in the Wuxi New District, in Jiangsu Province, China, the facilities of Wuxi ZQ total 85,000 square meters, including approximately 40,000 square meters of manufacturing facilities. Wuxi ZQ is engaged in the business of manufacturing and distributing light electric vehicles (LEV). Wuxi ZQ has multiple modern assembly production lines and electric vehicle parts production lines. Its intellectual property includes more than 20 national independent intellectual property rights. Wuxi ZQ operates pursuant to a Chinese electric bicycle production license issued by the Bureau of Technical Supervision. The company has passed the ISO9001 quality certification and the European Union EEC certification. Its products are sold in mainland China and in more than forty countries worldwide.
· Dongguan Qiangqiang Amperex Technologies Co., Ltd. Early in 2011, in order to expand our production of batteries to meet the market demand, we registered Dongguan Qiangqiang with the government, purchased the assets of Shenzhen ZQPT Co., Ltd., and purchased a parcel of land and factory buildings in Qingxi Town, Dongguan City, Guangdong Province, China. During 2011 we renovated the facilities, laid out the production lines, acquired the production equipment, and expanded the electric power production capacity at that site by installation of a 12,500 KVA substation. We then integrated the assets and business of Shenzhen ZQPT into the Dongguan facility. Dongguan Qiangqiang now boasts advanced production technology and equipment, with a production capacity of 500,000 aluminum shell battery cells and 70,000 ampere hour polymer lithium ion battery cells per day. The Dongguan Qiangqiang facilities measure 59,000 square meters, including 53,000 square meters of production space. The overall plant is divided into four sections: production area, office area, a battery research and development center, and an employee living area. Production at the Dongguan Qiangqiang facility now represents one-third of our company’s total production.
Item 2. Results of Operations
The consolidated financial results of our three operating subsidiaries for 2012 and 2011 are summarized in the following table:
(in thousands of dollars - $000)
2012 2011 % Change
Revenue(1) $ 135,694 $ 125,470 8.14%
Cost of revenue(2) 84,325 72,888 15.69%
Gross margin 37.16% 41.22% -4.06%
Research & development 2,457 1,461 68.13%
Operating expenses - other 4,857 3,931 23.57%
Income tax 10,721 11,475 (6.57%)
Net income$ 32,167$ 34,346 (6.34%)
_______________________________
(1) The contributions of our product lines to 2012 revenue was:
Batteries - small capacity29.3%Batteries - medium capacity9.8%Batteries - large capacity12.8%Miners lamps8.2%Light Electric vehicles40.0%(2) The primary reason for the disproportionate increase in the cost of revenue was the increase in labor costs in China.
Item 3. Assets
The primary assets of our three operating subsidiaries as of December 31, 2012 are included in the following table:
Cash and cash equivalents $ 7,425,400
Accounts receivable(1) 39,410,900
Inventory(2) 24,520,900
Property & equipment(3) 87,219,000
Construction in progress(4) 75,850,900
Intangible assets(5) 20,708,500
Total assets(6) $ 328,984,600
(1) Our accounts receivable balance increased during 2012. However, no receivable is more than six months old, and all are expected to be collected.
(2) Inventory includes raw materials - $13,828,500, work-in-progress - $5,046,500, finished goods - $5,646,000.
(3) Property & equipment increased by 75.44% during 2012.
(4) The locations of construction in progress were Donguan Qiangqiang - 54.90%, Harbin ZQPT - 27.79%, Wuxi ZQPT - 17.31%.
(5) Intangible assets increased by 137.11% during 2012, primarily related to the development of Dongguan Qiangqiang.
(6) Represents an increase of 26.2% since December 31, 2011.
Item 4. Liabilities
The primary liabilities of our three operating subsidiaries as of December 31, 2012 are included in the following table:
Accounts payable (1) $ 9,538,000
Short-term loans(2) 9,221,000
Long-term loans(3) 7,477,500
Total liabilities(4) $ 53,659,000
________________________
(1) Accounts payable was comprised primarily of debts to raw material suppliers.
(2) Short-term loans included a bank loan to Wuxi ZQPT of $4,769,500 and a bank loan to Harbin ZQPT of $4,451,500.
(3) Represents a five year bank loan to Dongguan Qiangqiang.
(4) Total liabilities decreased by 1.30% during 2012.
Management of ABAT
5.8.2013