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Segment Information
 12 Months Ended
Dec. 31, 2022
Segment Information [Abstract]  
Segment Information

29. Segment Information

 

The Group’s chief operating decision maker has been identified as the Chief Executive Officer (“CEO”) who reviews financial information of operating segments based on US GAAP amounts when making decisions about allocating resources and assessing performance of the Company. 

 

As a result of the Hitrans acquisition discussed in Note 12, the Group determined that Hitrans met the criteria for separate reportable segment given its financial information is separately reviewed by the Group’s CEO. As a result, the Group determined that for the year ended December 31, 2021 and 2022, it operated in two operating segments namely CBAK and Hitrans. CBAK’s segment mainly includes the manufacture, commercialization and distribution of a wide variety of standard and customized lithium ion rechargeable batteries for use in a wide array of applications. Hitrans’ segment mainly includes the development and manufacturing of NCM precursor and cathode materials.

 

The Company primarily operates in the PRC and substantially all of the Company’s long-lived assets are located in the PRC.

 

The Company’s chief operating decision maker evaluates performance based on each reporting segment’s net revenue, cost of revenues, operating expenses, operating income, finance income (expense), other income and net income. Net revenue, cost of revenues, operating expenses, operating income, finance income (expense), other income (expenses) and net income (loss) by segment for the years ended December 31, 2021 and 2022 were as follows:

 

For the year ended December 31, 2021  CBAT   Hitrans   Corporate
unallocated
(note)		   Consolidated 
Net revenues  $34,804,089   $17,865,644   $
-
   $52,669,733 
Cost of revenues   (30,946,417)   (16,612,826)   
-
    (47,559,243)
Gross profit   3,857,672    1,252,818    
-
    5,110,490 
Total operating expenses   (13,132,161)   (979,547)   (2,711,288)   (16,822,996)
Operating (loss) income   (9,274,489)   273,271    (2,711,288)   (11,712,506)
Finance income (expenses), net   286,741    (137,178)   635,317    784,880 
Other income, net   2,641,329    310,395    61,802,000    64,753,724 
Income tax credit   7,713,191    19,855    
-
    7,733,046 
Net income   1,366,772    466,343    59,726,029    61,559,144 
                     

 

For the year ended December 31, 2022  CBAT   Hitrans   Corporate
unallocated
(note)		   Consolidated 
Net revenues  $94,715,189   $154,010,296   $
-
   $248,725,485 
Cost of revenues   (86,333,047)   (144,297,114)   
-
    (230,630,161)
Gross profit   8,382,142    9,713,182         18,095,324 
Total operating expenses   (13,489,453)   (14,993,719)   (1,116,755)   (29,599,927)
Operating loss   (5,107,311)   (5,280,537)   (1,116,755)   (11,504,603)
Finance income (expenses), net   929,756    (438,387)   (309)   491,060 
Other (expenses) income, net   (3,590,693)   (3,661,782)   5,710,000    (1,542,475)
Income tax credit   
-
    1,228,207    
-
    1,228,207 
Net (loss) income   (7,768,248)   (8,152,499)   4,592,936    (11,327,811)
                     
As of December 31, 2022   
 
    
 
    
 
    
 
 
Identifiable long-lived assets   
93.661,521
    21,231,988    
-
    114,893,509 
Total assets   170,755,502    73,122,074    155,158    244,032,734 

 

Note: The Company does not allocate its assets located and expenses incurred outside China to its reportable segments because these assets and activities are managed at a corporate level.

 

Net revenues by product:

 

The Company’s products can be categorized into high power lithium batteries and materials used in manufacturing of lithium batteries. For the product sales of high power lithium batteries, the Company manufactured five types of Li-ion rechargeable batteries: aluminum-case cell, battery pack, cylindrical cell, lithium polymer cell and high-power lithium battery cell. The Company’s battery products are sold to packing plants operated by third parties primarily for use in mobile phones and other electronic devices. For the product sales of materials used in manufacturing of lithium batteries, the Company, via its subsidiary, Hitrans, manufactured cathode materials and Precursor for use in manufacturing of cathode. Revenue from these products is as follows:

 

   Year ended
December 31,
2021		   Year ended
December 31,
2022		 
High power lithium batteries used in:        
Electric vehicles  $243,837   $4,694,694 
Light electric vehicles   733,382    6,415,277 
Uninterruptable supplies   33,307,073    83,603,046 
Trading of raw materials used in lithium batteries   519,796    2,172 
    34,804,088    94,715,189 
           
Materials used in manufacturing of lithium batteries          
Cathode   8,726,240    75,331,144 
Precursor   9,139,405    78,679,152 
    17,865,645    154,010,296 
Total consolidated revenue  $52,669,733   $248,725,485 

 

Net revenues by geographic area:

 

The Company’s operations are located in the PRC. The following table provides an analysis of the Company’s sales by geographical markets based on locations of customers:

  

   Year ended
December 31,
2021		   Year ended
December 31,
2022		 
Mainland China  $43,745,765    198,114,578 
Europe   8,503,338    50,378,076 
USA   440    36,525 
Others   420,190    196,306 
Total  $52,669,733   $248,725,485 

 

Substantially all of the Company’s long-lived assets are located in the PRC.