NEV Battery Giant CATL Forecasts 2018 Profit Dip
Yu Liyan
DATE:  Jan 31 2019
/ SOURCE:  yicai
NEV Battery Giant CATL Forecasts 2018 Profit Dip NEV Battery Giant CATL Forecasts 2018 Profit Dip

(Yicai Global) Jan. 30 -- Chinese power battery maker Contemporary Amperex Technology, the world's largest, expects net profit slid between 3.3 percent and 8.94 percent last year after non-recurring incomes spiked its 2017 earnings.

The Fujian province-based firm reckons it pocketed between CNY3.5 billion (USD524 million) and CNY3.75 billion in 2018, it said in an earnings forecast yesterday.

Excluding one-off gains from the year prior, most of which came from the sale of shares in a subsidiary, the figure would have been up between 25.9 percent and 33.7 percent. CATL earned almost CNY4 billion in net profit in 2017, with more than a quarter of that coming from the sale of a 23 percent stake in lithium battery pack supplier Pride Power.

Chinese demand for power batteries rose last year from 2017 thanks to rapid development in the electric vehicle sector, the firm added, saying expansion efforts led to an increase in output and sales. But gross margins likely fell from 36.3 percent in 2017 after the government cut subsidies for new-energy vehicles, leading to lower prices of power batteries.

Production costs for lithium-ion batteries should fall as technology progresses, Yin Chengliang, deputy dean at Shanghai Jiaotong University's Institute of Automobile Engineering, told Yicai Global.

That means manufacturers should be able to increase their margins in future to make up for the waning subsidies, and CATL hopes to invest more in research and development to achieve that goal. It aims to create a power battery with an energy density of over 300 watt-hours per kilogram by 2020, which would halve production costs.

Editor: James Boynton

Follow Yicai Global on
Keywords:   CATL,Profit and Loss,NEVs,Batteries,Electric Cars