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Financial Health of Li-ion Companies

Financial Health of Li-ion Companies. Jordan Baird HC 399. Goals. Financial data Analyze the health Find trends. Why Li-ion Companies?. Li-ion is a relatively new and growing market Trends in growth industries High capital investment Losing money in the beginning

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Financial Health of Li-ion Companies

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  1. Financial Health of Li-ion Companies Jordan Baird HC 399

  2. Goals • Financial data • Analyze the health • Find trends

  3. Why Li-ion Companies? • Li-ion is a relatively new and growing market • Trends in growth industries • High capital investment • Losing money in the beginning • Materials cost/production cost affects price competativeness

  4. Financial Data • Public companies report financial data • Data makes up financial health • Financial ratios go one step further

  5. Companies • C&D Technologies - Manufacture • Valence Technology – Research and manufacture • A123 Systems – Research and manufacture • Enersys - Manufacture • Exide Technologies - Manufacture • China BAK - Manufacture

  6. Three Financial Ratios And one financial statement

  7. Profitability • Gross Profit Margin • A percent profit made on each product sale

  8. Liquidity • Quick Ratio • How quick a company can pay up without needing to sell anymore inventory/product

  9. Efficiency • Inventory turnover • How quickly inventory is sold

  10. Cash Flow Statement • Shows where cash is being spent • Three categories • Operations • Investing activities • Financing activities

  11. Cash Flow Statement • Most recent data, million USD • Cash flow trends • Expanding infrastructure • Making money • Taking debt

  12. Summary • Profitability • 20% margins • Liquidity • 1 to 1 • Efficiency • 5 days • Cash from Operations • Making money

  13. Relation to Overall Li-Ion Market

  14. Cost of Li-Ion • Does the cost of each company’s product decrease with time? • Maintained margins by lowering price

  15. Sales of Li-Ion • Are the companies selling more li-ion batteries? • Not the companies I looked at

  16. Private companies • Many companies do not publicly provide financial data • Tesla • Boston Power • Can draw rough conclusions about Boston Power’s performance • Tesla too different for such a projection

  17. Questions/Comments?

  18. Works Cited "Financial Ratios." MissouriBusiness.net: Missouri Business Development Program. 25 Feb. 2008. Web. 1 Dec. 2009. <http://www.missouribusiness.net/sbtdc/docs/financial_ratios.asp>. "Financial Ratios." NetMBA Business Knowledge Center. 2007. Web. 1 Dec. 2009. <http://www.netmba.com/finance/financial/ratios/>. Google Finance. Google, 1 Dec. 2009. Web. 01 Dec. 2009. <http://www.google.com/finance>. "Investor Relations." A123 Systems, 18 Nov. 2009. Web. 01 Dec. 2009. <http://ir.a123systems.com/>. "Investor Relations." Valence Technology, 6 Nov. 2009. Web. 01 Dec. 2009. <http://ir.valence.com/sec.cfm>. "Li-ion Battery Manufacturers: The Bleeding Edge of Energy Storage Technology -- Seeking Alpha." Stock Market News, Opinion, Analysis, Investing Ideas. Seeking Alpha, 22 Mar. 2009. Web. 01 Dec. 2009. <http://seekingalpha.com/article/127163-li-ion-battery-manufacturers-the-bleeding-edge-of-energy-storage- technology>. "Lithium Ion Battery Manufacturers in the World." Lithium Ion Battery Manufacturers in the World. 2009. Web. 01 Dec. 2009. <http://energy.sourceguides.com/businesses/byP/batP/batt/btora/bType/lion/byB/mfg/mfg.shtml>. "Next-Generation EDGAR system - Better Data. Stronger Markets." U.S. Securities and Exchange Commission, 1 Dec. 2009. Web. 01 Dec. 2009. <http://www.sec.gov/edgar/searchedgar/webusers.htm>. SBIR - Small Business Innovation Research. U.S. Government. Web. 01 Dec. 2009. <http://www.sbir.gov/>. Stock, Mutual Fund, Hedge Fund, ETF Investment Research. Morningstar, 1 Dec. 2009. Web. 01 Dec. 2009. <http://www.morningstar.com/?byrefresh=yes>.

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