Consolidated Results Reflect Performance of Wuxi ZhongQiang        Enhanced Battery Production Capacity Fully Operational             Battery Sales Backlog Stands At $53 Million 

NEW YORK, Aug. 11, 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 second quarter ended June 30, 2009.

Revenue for the second quarter of 2009 was $13.8 million, a 17.2% increase from $11.7 million in the second 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"). In the second quarter of 2009, sales of electric vehicles from Wuxi ZQ were $3.6 million or 26.3% of total revenue. Large capacity battery cells generated $3.8 million in sales, or 27.3% of total revenue in the second quarter of 2009. Medium capacity battery cells generated $2.8 million in sales, or 20.5% of total revenue in the second quarter of 2009. Small capacity battery cells generated $1.3 million in sales, or 9.2% of total revenue in the second quarter of 2009. Miner's lamp battery cells generated $2.3 million in sales, or 16.8% of total revenue in the second quarter of 2009. Sales from medium capacity battery cells in the second quarter of 2009 exclude intercompany sales of approximately $1.2 million to Wuxi ZQ. Sales to Wuxi ZQ were previously categorized as medium capacity cell battery sales.

Gross profit for the second quarter of 2009 was $6.3 million, a 5.7% increase from $6.0 million in the second quarter of 2008. Gross margin was 45.8% in the second quarter 2009, compared to 50.8% in the second quarter of 2008. Lower gross margin performance was a result of sales of electrical vehicles, a lower margin product, offset by a higher proportion of battery sales from higher margin battery products, primarily large capacity battery cells and miner's lamps.

Operating income for the second quarter of 2009 was $2.4 million, a 55.8% decrease from $5.4 million during the second quarter of 2008. Operating expenses increased to $3.9 million in the second quarter of 2009 from $579,974 in the second quarter of 2008. The increase reflects increased selling and administrative expenses at Wuxi ZQ and a one-time bad debt allowance associated with the acquisition. In addition, ABAT's U.S. office incurred higher administrative expenses such as salaries, legal fees and marketing expenses in the second quarter of 2009. The Company also recognized higher non-cash stock and option compensation amortization expense in the second quarter of 2009.

Net income in the second quarter of 2009 was $8.0 million, or $0.14 per diluted share, a 70.9% increase from $4.7 million, or $0.09 per diluted share in the second quarter of 2008. The increase in net income reflected a one-time gain on purchase of $9.9 million and a related $3.5 million deferred tax provision associated with the acquisition of Wuxi ZQ on May 4, 2009. The gain on purchase was realized due to the fair value of the net assets of Wuxi ZQ, estimated at $19.8 million, exceeding the total purchase consideration of $9.9 million.

Commenting on the results, Mr. Zhiguo Fu, Chairman and CEO of Advanced Battery Technologies, stated, "We are pleased with our results during the second quarter. During the quarter, we successfully completed the acquisition of Wuxi ZQ and began integrating their operations with those of Advanced Battery. We expanded assembly capacity in our Harbin facility and it became fully operational late in the second quarter of 2009.

"ABAT is experiencing strong demand in both domestic and international markets for electric and hybrid electric vehicles as individuals and industries switch to alternate forms of transportation. Following the completion of our acquisition of Wuxi ZQ, ABAT now has the manufacturing capability to produce vehicles, batteries and many key vehicle parts, meaning Wuxi and ABAT can produce high quality vehicles with margins that are superior to its competition."

Balance Sheet

As of June 30, 2009, the Company had $45.0 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 June 30, 2009 totaled $55.6 million.

Battery backlog is approximately $53 million as of August 3, 2009, 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 Wednesday August 12, 2009 to discuss its second quarter 2009 financial results. Listeners may access the call by dialing 1-888-211-4542 or 1-913-312-1414 for international callers.

A replay of the call will be available from August 12, 2009 through August 19, 2009.