Advanced Battery Technologies Reports Third Quarter 2009 Financial Results

Sales Backlog of $67 Million, Including $55 Million Battery Backlog


NEW YORK, Nov. 9, 2009 (GLOBE NEWSWIRE) -- Advanced Battery Technologies, Inc. (Nasdaq: ABAT), a leading developer, manufacturer and distributor of rechargeable Polymer Lithium-Ion (PLI) batteries, today announced its financial results for the third quarter ended on September 30, 2009.

Revenue for the third quarter of 2009 was $17.7 million, a 39.9% increase from $12.7 million in the third quarter of 2008. The increase in revenue was driven by the contribution of sales of electric vehicles by our wholly-owned subsidiary, Wuxi Zhongqiang Autocycle Co., Ltd. ("Wuxi ZQ"), which the Company acquired in the second quarter of 2009. In the third quarter of 2009, sales of electric vehicles from Wuxi ZQ were $6.7 million or 37.9% of total revenue. Large capacity battery cells generated $3.3 million in sales, or 18.5% of total revenue in the third quarter of 2009. Medium capacity battery cells generated $1.6 million in sales, or 8.8% of total revenue in the third quarter of 2009. Small capacity battery cells generated $1.1 million in sales, or 6.1% of total revenue in the third quarter of 2009. Miner's lamps containing ABAT battery cells generated $5.1 million in sales, or 28.6% of total revenue in the third quarter of 2009. Sales from medium capacity battery cells in the third quarter of 2009 exclude intercompany sales of approximately $1.8 million to Wuxi ZQ. Sales to Wuxi ZQ were previously categorized as medium capacity cell battery sales.

Gross profit for the third quarter of 2009 was $7.6 million, a 29.6% increase from $5.9 million in the third quarter of 2008. Gross margin was 43.1% in the third quarter 2009, compared to 46.5% in the third quarter of 2008. Lower gross margin performance was a result of sales of electrical vehicles, a lower margin product. During the same period gross margin from battery sales increased, due to a higher proportion of battery sales from higher margin battery products, primarily large capacity battery cells and miner's lamps.

Operating income for the third quarter of 2009 was $5.2 million, a 3.0% increase from $5.1 million during the third quarter of 2008. Operating expenses increased to $2.4 million in the third quarter of 2009 from $795,336 in the third quarter of 2008. The increase reflects increased selling and administrative expenses at Wuxi ZQ. In addition, ABAT's U.S. office incurred higher administrative expenses such as salaries, legal fees and marketing expenses in the third quarter of 2009. The Company also recognized higher non-cash stock and option compensation amortization expense in the third quarter of 2009.

Net income in the third quarter of 2009 was $4.8 million or $0.08 per diluted share, a 10.2% increase from $4.4 million, or $0.08 per diluted share in the third quarter of 2008. The increase in net income reflected a $336,849 gain from the forgiveness of interest expenses related to a loan associated with our subsidiary Wuxi ZQ. Commenting on the results, Mr. Zhiguo Fu, Chairman and CEO of Advanced Battery Technologies, stated, "We are pleased with our results during the third quarter. Following our acquisition of Wuxi ZQ in May 2009, we are excited to see positive momentum in the electric vehicle business continue in the third quarter, which helped to augment sales by signing new production contracts and expanding the international scope of our operations during the quarter."

"As we continue to integrate the operations of Wuxi ZQ into those of Advanced Battery, we are focused on expanding production capacities and enhancing R&D capabilities in an attempt to realize the synergies of ABAT and assure the Company of a leading position within the battery technology and vehicle production industry. We are confident that our ongoing efforts combined with our proven ability to deliver high-quality products continue to help ABAT tackle sales opportunities in both domestic and international markets being created by the worldwide movement towards more economical and cleaner high performance vehicles."

Balance Sheet

As of September 30, 2009, the Company had $33.8 million of cash and cash equivalents, compared to $32.7 million of cash and cash equivalents at December 31, 2008. The Company's working capital on September 30, 2009 totaled $56.9 million.

As of October 30, 2009, the Company had a backlog of over $67 million including a battery backlog of approximately $55 million, all of which is expected to be delivered in the next 12 months.

Conference Call

Management will host a conference call at 8:30 am ET, on Tuesday November 10, 2009 to discuss its third quarter 2009 financial results. Listeners may access the call by dialing #1-877-857-6144 or #1-719-325-4776 for international callers.

A replay of the call will be available from November 10, 2009 through November 17, 2009. Listeners may access the replay by dialing #1-888-203-1112 or #1-719-457-0820 for international callers; passcode: 4176870.

About Advanced Battery Technologies, Inc.

Advanced Battery Technologies, Inc., founded in September 2002, develops, manufactures and distributes rechargeable Polymer Lithium-Ion (PLI) batteries. The Company's products include rechargeable PLI batteries for electric automobiles, motorcycles, mine-use lamps, notebook computers, walkie-talkies and other electronic devices. ABAT's batteries combine high-energy chemistry with state-of-the-art polymer technology to overcome many of the shortcomings associated with other types of rechargeable batteries. Wuxi Zhongqiang Autocycle Co., Ltd, founded in 2002, develops and manufactures various types of electric vehicles. Wuxi Zhongqiang owns three types of products listed in the E-Bike directory, with more than 20 varieties: electric bikes; agricultural transport vehicles for practical transportation; sport utility e-vehicles such as scooters, off-road vehicles, go-karts, snow scooters, sea scooters, as well as underwater propeller vehicles. Wuxi Zhongqiang products are exported to countries and regions in Europe, the United States and Asia. The Company has a New York office, with its executive offices and manufacturing facilities in China. For more information about Advanced Battery Technologies, Inc. (ABAT), please visit: http://www.abat.com.cn.

Safe Harbor Statement

Certain statements in this release and other written or oral statements made by or on behalf of the Company are "forward looking statements" within the meaning of the federal securities laws. Statements regarding future events and developments and our future performance, as well as management's expectations, beliefs, plans, estimates or projections relating to the future are forward-looking statements within the meaning of these laws. The forward looking statements are subject to a number of risks and uncertainties including market acceptance of the Company's services and projects and the Company's continued access to capital and other risks and uncertainties. The actual results the Company achieves may differ materially from those contemplated by any forward-looking statements due to such risks and uncertainties. These statements are based on our current expectations and speak only as of the date of such statements.



                 ADVANCED BATTERY TECHNOLOGIES, INC.
        CONDENSED CONSOLIDATED STATEMENTS OF INCOME AND OTHER
                         COMPREHENSIVE INCOME
                             (UNAUDITED)

                     For Three-month ended      For Nine-month ended
                          September 30,             September 30,
                       2009          2008        2009          2008

 Revenues           $17,714,278  $12,662,585  $42,171,598  $34,442,838

 Cost of Goods Sold  10,087,228    6,776,437   23,197,017   17,542,233
                    -----------  -----------  -----------  -----------

 Gross Profit         7,627,050    5,886,148   18,974,580   16,900,605

 Operating Expenses
  Research &
   Development
   expenses             118,764           --      307,236           --
  Selling, general
   and
   administrative     2,264,173      795,336    6,900,571    1,947,200
                    -----------  -----------  -----------  -----------

   Operating income   5,244,112    5,090,812   11,766,773   14,953,405
                    -----------  -----------  -----------  -----------

 Other Income
  (Expenses)
  Interest income        76,841       51,925      247,387       68,037
  Interest (expense)   (120,417)          --     (326,636)          --
  Equity loss from
   unconsolidated
   entity                 5,190           --      (62,470)          --
  Gain on bargain
   purchase                  --           --    9,909,320           --
  Forgiveness of
   debt                 336,849      336,849
  Other income
   (expenses)              (160)          --       13,548           --
                    -----------  -----------  -----------  -----------
 Total other income
  (expenses)            298,302       51,925   10,117,997       68,037
                    -----------  -----------  -----------  -----------

 Income Before
  Income Taxes        5,542,414    5,142,737   21,884,770   15,021,442

 Provision for
  Income Taxes
  (Benefit)
  Income tax-Current    726,337      770,777    2,010,030    2,125,733
  Income tax-
   Deferred                  --           --    3,468,262           --
                    -----------  -----------  -----------  -----------

 Net income         $ 4,816,077  $ 4,371,960  $16,406,478  $12,895,709

 Other Comprehensive
  Income
  Foreign currency
   translation
   adjustment           (28,402)     539,959      (57,938)   3,174,659
                    -----------  -----------  -----------  -----------

 Comprehensive
  Income            $ 4,787,675  $ 4,911,919  $16,348,539  $16,070,368
                    ===========  ===========  ===========  ===========

 Earnings per share
  Basic             $      0.09  $      0.10  $      0.33  $      0.30
                    ===========  ===========  ===========  ===========
  Diluted           $      0.08  $      0.08  $      0.28  $      0.25
                    ===========  ===========  ===========  ===========

 Weighted average
  number of common
  shares outstanding
  Basic              52,970,305   44,349,487   49,676,366   42,456,824
                    ===========  ===========  ===========  ===========
  Diluted            61,342,040   52,527,987   57,974,862   50,635,324
                    -----------  -----------  -----------  -----------


                 ADVANCED BATTERY TECHNOLOGIES, INC.
                CONDENSED CONSOLIDATED BALANCE SHEETS

                 ASSETS
                 ------
                                            September 30, December 31,
                                                2009          2008
                                             (Unaudited)
                                            ------------  ------------
 Current assets:
  Cash and cash equivalents                 $ 33,839,657  $ 32,746,155
  Accounts receivable, net                    22,984,388    14,708,078
  Inventories, net                             6,144,293     1,748,115
  Loan receivable,net                          1,622,417     1,600,000
  Other receivables                            1,334,800       240,726
  Advance to suppliers,net                     4,550,827       246,163
                                            ------------  ------------
    Total Current Assets                      70,476,382    51,289,237
                                            ------------  ------------

 Property, plant and equipment, net of
  accumulated depreciation of $9,856,869 as
  of September 30, 2009 and $2,803,788 as of
  December 31, 2008                           47,161,776    16,635,843
                                            ------------  ------------
    Total Fixed Assets                        47,161,776    16,635,843
                                            ------------  ------------

 Other assets:
  Investment in unconsolidated entity            975,079     1,037,550
  Investment advance                                  --     3,000,000
  Deposit for long-term assets                 1,399,130     1,748,363
  Intangible assets, net                      14,546,530     1,548,158
  Goodwill                                     2,487,185     2,487,080
  Other assets                                    47,975         6,000
                                            ------------  ------------
    Total other assets                        19,455,899     9,827,151
                                            ------------  ------------

   Total Assets                             $137,094,057  $ 77,752,231
                                            ============  ============

    LIABILITIES AND STOCKHOLDERS' EQUITY
    ------------------------------------

 Current liabilities:
  Short-term loan                           $  7,333,674            --
  Accounts payable                             2,686,256       415,850
  Advance from Customers                         522,843        80,479
  Accrued expenses and other payables          1,793,834       784,070
  Loan from officers                                  --        17,236
  Tax payable                                  1,232,245            --
                                            ------------  ------------
    Total Current Liabilities                 13,568,852     1,297,635

 Long term liabilities:
  Deferred tax liability                       3,468,262            --

   Total Liabilities                          17,037,114     1,297,635
                                            ------------  ------------

 Stockholders' Equity
  Preferred stock, $0.001 face value,
   5,000,000 shares authorized;
   500 shares issued and 500 shares
   outstanding as of September 30, 2009 and
   0 shares issued and outstanding as of
   December 31, 2008                        $          1            --
  Common stock, $0.001 par value,
   150,000,000 shares authorized; 62,311,947
   shares issued and 62,117,366 shares
   outstanding as of September 30, 2009
   and 54,781,577 shares issued and
   54,662,067 shares outstanding as of
   December 31, 2008                              62,312        54,782
  Additional paid-in-capital                  66,740,056    39,289,991
  Accumulated other comprehensive income       5,954,537     6,012,475
  Retained earnings                           47,799,528    31,393,050
  Less: Cost of treasury stock (194,581 and
   119,510 shares as of September 30,2009
   and December 31, 2008)                       (499,490)     (295,702)
                                            ------------  ------------
    Total Stockholders' Equity               120,056,943    76,454,596
                                            ------------  ------------

   Total Liabilities and Stockholders'
    Equity                                  $137,094,057  $ 77,752,231
                                            ============  ============


            

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