Advanced Battery Technologies Announces Second Quarter 2011 Financial Results
Advanced Battery Technologies, Inc. announced financial results for the quarter ended June 30, 2011. The company had total revenues of $31,350,652 for the three months ended June 30, 2011, an increase of $8,515,294 or 37.3%, compared to $22,835,358 for the three months ended June 30, 2010. For the six months ended June 30, 2011, total revenues of $59,992,387 represented an increase of $17,608,012 or 41.5%, compared to $42,384,375 for the six months ended June 30 2010.
The company’s gross margin declined from 48% in the three months ended June 30, 2010 to 43% in the same period of 2011, and from 49% in the first half of 2010 to 42% in the first half of 2011. The decline occurred primarily because the $9,602,091 in sales of small capacity batteries generated from the new Shenzhen facility yielded a low margin relative to other revenue.
The company’s operating expenses increased by 21%, from $1,992,831 in the three months ended June 30, 2010 to $2,374,648 in the three months ended June 30, 2011. The primary reason for the increase was the fact that operating expenses of the Shenzhen operation that the company acquired in January 2011 were included in our 2011 results. In addition, research and development expenses increased by $259,277 from the second quarter of 2010 to the second quarter of 2011. These increases were partially offset by a bad debt expense of $160,000 incurred in the second quarter of 2010 that was not replicated in 2011.
Operating income for the three months ended June 30, 2011 totaled $11,044,407, an increase of 22% from operating income in the three months ended June 30, 2010. Operating income for the six months ended June 30, 2011 totaled $20,847,534, an increase of 30% from operating income in the six months ended June 30, 2010.
Zhiguo Fu, Chairman and CEO of Advanced Battery Technologies, said, "We are heartened by the continual growth of our operating income, which demonstrates the success of our expansion efforts. Although the growth of operating income lagged the growth of revenue, due to low margins on our small capacity batteries, our current expectation, is that, in time, the advanced technology and facilities that we acquired from Shenzhen ZQ, along with our established customer list, will allow us to achieve worthwhile margins in the small capacity battery sector. For that reason we expect that the focus of operations at the Dongguan industrial park that we currently have under construction will be in large part on small capacity batteries. This, coupled with our steady growth in the large capacity battery sector, should give us a solid platform from which to build a strong position in the international battery market."