Tantech : Annual Report for Fiscal Year Ending 2025-12-31 (Form 20-F)
TANH
Published on 05/14/2026 at 04:42 pm EDT
OPERATING AND FINANCIAL REVIEW AND PROSPECTS
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with our consolidated financial statements and related notes included elsewhere in this report. In addition to historical consolidated financial information, the following discussion contains forward-looking statements that reflect our plans, estimates, and beliefs. Our actual results could differ materially from those discussed in the forward-looking statements. Factors that could cause or contribute to these differences include those discussed below and elsewhere in this report."
A. Operating Results
Overview of Company
Tantech Holdings Ltd ("Tantech BVI" or "the Company") is a holding company established under the laws of the British Virgin Islands on November 9, 2010. Tantech BVI, through its subsidiaries (together as "we" or "the Group") engages in research, development, production and distribution of various products made from bamboo and investment in mining exploration.
Historically, we have been a specialized manufacturer of bamboo charcoal-based products with primary business focus on consumer products and low emission BBQ charcoal. After completing a series of re-organizations, dismantling prior VIE structure and business strategic changes, through our operating subsidiaries, we are now engaging in research, development, production and distribution of various charcoal products and vehicles, as well as trading bamboo charcoal products. We also have investments in mining exploration. For more detailed information about our recent developments, please refer to Note 1 of the footnotes accompanying the financial statements included in this report.
During the year ended December 31, 2023 we merged its biodegradable packaging business segment into its consumer products segment. On April 2, 2025, the Board approved the sale of its Electric Vehicle business (the "EV Business"). We determined that the disposal of the EV Business met the criteria to be classified as a discontinued operation and, as a result, the EV Business's historical financial results are reflected in the consolidated financial statements as a discontinued operation. The disposal of the EV Business represents a strategic shift that has a significant effect on our operations and financial results, which trigger discontinued operations accounting in accordance with ASC 205-20-45. The assets and liabilities related to the discontinued operations were retroactively classified as assets/liabilities held for sale, while results of operations related to the discontinued operations, including comparatives, were retroactively reported as loss from discontinued operations for the years ended December 31, 2025, 2024 and 2023, respectively.
Our consumer products include purification and deodorization products, household cleaning products and barbecue charcoals designed for domestic market. Purification and deodorization products and household cleaning products are sold under the brand name "Charcoal Doctor." Purification and deodorization products include air purification products, deodorant products and bamboo vinegar. Household cleaning products include toilet cleaning products, kitchen cleaning products, personal care products and clothing detergent products.
The largest category of our consumer products is purification and deodorization products. Made from dry distilled carbonized bamboo, our purification and deodorization products have the ability to absorb harmful substances and air-borne odors, including benzene, formaldehyde, ammonia and carbon tetrachloride. These products also come in many shapes and varieties for a multitude of purposes including pillows, cushion insoles, wrist pads, clothes hangers and other products. Bamboo vinegar is an additive that can be used in food processing, medical and hygiene products and fertilizer. Although it currently only accounts for a small portion of our revenue, bamboo vinegar products are crucial for us to maintain close ties with the agricultural industry which we believe will be a key area for growth in the coming years. Cleaning products, including disinfectants, detergents, lotions, specialized soaps and toilet cleaners are relatively new in our consumer products but provide us another opportunity for growth. Purchased from third parties and sold through our distribution channel, barbecue charcoals designed for China's domestic market have also been a key source of revenue for us in recent years.
Factors Affecting Our Results of Operations
Price Inelasticity of Raw Materials May Reduce Our Profit
As a specialized manufacturer of bamboo charcoal-based products, we rely on the continuous and stable supply of bamboo charcoal to ensure our operation and expansion. Although bamboo (and as a result bamboo charcoal) is a renewable supply, price inelasticity at any given time may increase the likelihood of bidding wars, resulting in an increase in raw material prices and thus reduce our profit. In addition, as we are competing based upon low price, we will risk losing customers by increasing our selling prices.
Competition in Consumer Product
Our products face competition from other producers. In our consumer product segment, we face competition from a number of companies that have similar product portfolios. Many of such competitors' products are not bamboo-based; instead, we compete based on our products' functional use. Many such competitors are able to provide functionally similar products without relying on bamboo or bamboo charcoal components.
Although our Charcoal Doctor brand is one of the largest and most famous in the charcoal bag and bamboo charcoal market, the bamboo charcoal-based consumer product industry is relatively fragmented and subject to relatively low barriers of entry.
Our Charcoal Doctor air purification products compete with products from charcoal-based competitors such as Zhejiang Maitanweng Ecological Development Co., Ltd., Zhejiang Jiejiegao Charcoal Industry Co., Ltd., and Quzhou Modern Charcoal Industry, Co., Ltd.
Our Charcoal Doctor toilet cleaner competitors include non-charcoal-based competitors such as SC Johnson & Son (Shanghai) Inc. (which makes the Mr. Muscle brand in China), Blue Moon Chinese Co., Ltd., Shanghai White Cat Group Ltd., Beijing Green Umbrella Chemical Co., Ltd. and Weilai (Guangzhou) Consumer products Co., Ltd.
Results of Operations
The following table summarizes the selected results of our operation during the fiscal years ended December 31, 2025 and 2024, respectively, and provides information regarding the dollar and percentage increase or (decrease) during such years.
(All amounts, other than percentages, in thousands of U.S. dollars)
Years ended December 31,
2025
2024
As a
As a
percentage
percentage
Dollar ($)
Percentage
Dollars in
of sales
Dollars in
of sales
Increase
Increase
Statement of Operations Data:
thousands
revenue
thousands
revenue
(Decrease)
(Decrease)
Revenues
Cost of revenues
Gross profit
Operating expenses
Selling expenses
-
%
General and administrative expenses
Research and development expenses
Total operating expenses
(Loss) income from operations
Other income (expenses)
Change in fair value of convertible note
Change in fair value of warrant liabilities
Changes in fair value of digital assets
-
%
-
%
-
%
Interest income
Interest expense
Financing interest income, net
Long- term investments impairment
-
%
-
%
Gain (loss) from disposal of subsidiaries
Gain from disposal of financing receivables
-
%
-
%
Loss on refund receivable
-
%
-
%
Gain on debt extinguishment
-
%
Other income (expenses), net
Total other expenses, net
Income (loss) before income tax expense
Income tax provision
Net loss from continuing operations
Net loss from discontinued operations
Net loss
The following table summarizes the selected results of our operation during the fiscal years ended December 31, 2024 and 2023, respectively, and provides information regarding the dollar and percentage increase or (decrease) during such years.
Years ended December 31,
2024
2023
As a
As a
percentage
percentage
Dollar ($)
Percentage
Dollars in
of sales
Dollars in
of sales
Increase
Increase
Statement of Operations Data:
thousands
revenue
thousands
revenue
(Decrease)
(Decrease)
Revenues
Cost of revenues
Gross profit
Operating expenses
Selling expenses
General and administrative expenses
Research and development expenses
Total operating expenses
Income from operations
Other income (expenses)
Change in fair value of convertible note
Change in fair value of warrant liabilities
-
%
-
%
Interest income
Interest expense
Financing interest income
Rental income from related parties
-
%
Gain on debt extinguishment
-
%
-
%
Gain from disposal of investments
Other income (expenses), net
Total other (expenses) income, net
Income before income tax
Income tax provision
Net income (loss) from continuing operations
Net loss from discontinued operations
Net(loss) income
Revenues:
Revenues from continuing operations decreased by approximately $4.6 million, or 10.7%, to approximately $38.4 million in fiscal 2025 from approximately $42.9 million in fiscal 2024. The decrease was mainly attributable to the reduced demand in the persistently sluggish real estate market for our carbon products, which are used in household cleaning.
Revenues from continuing operations decreased by approximately $1.7 million, or 3.8%, to approximately $42.9 million in fiscal 2024 from approximately $44.6 million in fiscal 2023. The decrease was mainly attributable to the reduced demand in the sluggish real estate market for our carbon products, which are used in household cleaning.
Cost of revenues:
Our cost of revenues from continuing operations decreased by approximately $2.8 million, or 8.2%, to approximately $31.2 million in fiscal 2025 from approximately $34.0 million in fiscal 2024, which was in line with the decrease of revenue. As a percentage of revenues, the cost of revenues was 81.4% and 79.2% in fiscal 2025 and 2024, respectively.
Our cost of revenues from continuing operations decreased by approximately $0.9 million, or 2.6%, to approximately $34.0 million in fiscal 2024 from approximately $34.9 million in fiscal 2023, which was in line with the decrease of revenue. As a percentage of revenues, the cost of revenues was 79.2% and 78.2% in fiscal 2024 and 2023, respectively.
Gross profit:
Our gross profit from continuing operations decreased by approximately $1.8 million, or 20.1%, to approximately $7.1 million in fiscal 2025 from approximately $8.9 million in fiscal 2024. The gross profit margin was 18.6% and 20.8% in fiscal 2025 and 2024, respectively.
Our gross profit from continuing operations decreased by approximately $0.8 million, or 8.0%, to approximately $8.9 million in fiscal 2024 from approximately $9.7 million in fiscal 2023. The gross profit margin was 20.8% and 21.8% in fiscal 2024 and 2023, respectively.
Selling expenses:
Selling expenses from continuing operations were less than $0.1 million in fiscal 2025 and 2024. As a percentage of revenues, our selling expenses were 0.0% and 0.1% of revenues in fiscal 2025 and 2024, respectively.
Selling expenses from continuing operations decreased by approximately $0.2 million, or 76.6%, to approximately $0.1 million in fiscal 2024 from approximately $0.2 million in fiscal 2023. As a percentage of revenues, our selling expenses were 0.1% and 0.5% of revenues in fiscal 2024 and 2023, respectively. The decrease was mainly due to less marketing and customs declaration service fees in fiscal 2024.
General and administrative expenses:
Our general and administrative expenses from continuing operations increased by approximately $14.4 million, or 295.6 %, to approximately $19.3 million in fiscal 2025 from approximately $4.9 million in fiscal 2024 As a percentage of revenues, general and administrative expenses increased to 50.2% in fiscal 2025, compared to 11.3% in fiscal 2024. The increase in general and administrative expenses was primarily attributable to increase of approximately $15.9 million in allowance of credit loss, offset by decreased professional consulting fee of approximately $1.8 million.
Our general and administrative expenses from continuing operations decreased by approximately $0.9 million, or 16.3%, to approximately $4.9 million in fiscal 2024 from approximately $5.8 million in fiscal 2023. As a percentage of revenues, general and administrative expenses decreased to 11.3% in fiscal 2024, compared to 13.0% in fiscal 2023. The decrease in general and administrative expenses was primarily attributable to decrease of approximately $1.4 million in allowance of credit loss, offset by increased professional consulting fee.
Research and development expenses
Our research and development expenses from continuing operations were less than $0.1 million in fiscal 2025, 2024 and 2023. We expect research and development expenses to increase as we expand our research and development activities to develop more new high-tech products to meet customer demands.
Total operating expenses
Total operating expenses from continuing operations increased by approximately $14.4 million, or 290.1%, to approximately $19.3 million in fiscal 2025 from approximately $5.0 million in fiscal 2024, which was mainly due to increase of approximately $14.4 million in general and administrative expenses.
Total operating expenses from continuing operations decreased by approximately $1.1 million, or 18.1%, to approximately $5.0 million in fiscal 2024 from approximately $6.1 million in fiscal 2023, which was mainly due to decrease of approximately $0.9 million in general and administrative expenses.
Change in fair value of convertible note
We recognized the convertible note at fair value.
Change in fair value of convertible note from continuing operations amounted to loss of approximately $0.2 million, $0.5 million and $0.2 million in fiscal 2025, 2024 and 2023, respectively.
Change in fair value of warrants liabilities
Change in fair value of warrants liability from continuing operations amounted to a gain of approximately $0.6 million in fiscal 2025 and a loss of approximately $3.8 million in fiscal 2024. The fair value of our warrants derivative liability assumed from the April 2024 private placement is re-measured to its fair value at the end of each reporting period, with the change being recorded as other expense or gain.
Interest income
Our interest income from continuing operations increased by approximately $0.3 million, or 709.3%, to approximately $0.3 million in fiscal 2025 from approximately $0.04 million in fiscal 2024, which was in line with increased loan receivable and refund receivable.
Our interest income from continuing operations was less than $0.1 million in fiscal 2024 and 2023.
Interest expenses
Our interest expenses from continuing operations kept approximately $0.3 million in fiscal 2025, 2024 and 2023.
Financing interest income, net
Starting in June 2022, we provided commercial factoring services to customers who seek financing from their receivables. For the years ended December 31, 2025, 2024 and 2023, we recognized financing interest income, net from continuing operations of approximately $0.4 million, $1.8 million and $2.2 million, respectively.
Rental income from related parties
Since fiscal 2021, we signed some lease agreements with related parties to lease a part of production facilities to related parties, rent income from continuing operations was approximately nil, nil and $0.1 million in the years ended December 31, 2025, 2024 and 2023, respectively.
Long- term investments impairments
(1) impairment on investment of Libo Haokun Stone Co., Ltd. ("Libo Haokun")
On January 10, 2018, the Group invested approximately $11.7 million (RMB120.0 million) to acquire 18% equity interest in Libo Haokun. Libo Haokun holds a government-issued permit and has the exclusive right to mine a 0.11 square-kilometer marble quarry in the central area of Guizhou province, China. We accounted for our 18% equity interest in Libo Haokun using the measurement alternative under ASC 321, as the investment does not have a readily determinable fair value and we do not exercise significant influence. During the year ended December 31, 2025, we identified several impairment indicators, most significantly a government prohibition on mining activities in Guizhou province affecting marble quarry operations. Although our mining permit was extended through 2028, the operational restrictions have severely limited the investee's ability to generate projected cash flows. We performed a quantitative assessment as of December 31, 2025, utilizing income approach. Based on this assessment, we determined the impairment was other-than-temporary. Accordingly, we recorded an impairment charge of approximately $16.7 million for the year ended December 31, 2025, reducing the carrying value to its estimated fair value of nil.
(2) impairment on investment of Fuquan Chengwang Mining Co., Ltd. ("Fuquan Chengwang")
On November 29, 2019, the Group acquired 18% of the equity interest in Fuquan Chengwang at a price of approximately $6.4 million (RMB46.3 million). The consideration equals 18% of RMB257.35 million, the value of the mining right under a permit being renewed by Fuquan Chengwang according to an evaluation report. Fuquan Chengwang is a basalt mining company. We accounted for our equity interest in Fuquan Chengwang using the measurement alternative under ASC 321, as the investment does not have a readily determinable fair value and we do not exercise significant influence. During the year ended December 31, 2025, we identified several impairment indicators, most significantly a government prohibition on at the basalt site, which has resulted in a significant downward revision of the investee's valuation. We engaged a third-party valuation firm and performed a quantitative assessment utilizing income approach. Based on this assessment, we determined the impairment was other-than-temporary. Accordingly, we recorded an impairment charge of approximately $6.4 million for the year ended December 31, 2025, reducing the carrying value to its estimated fair value of nil.
Gain (loss) from disposal of subsidiaries
On May 15, 2025, we closed the sale of the Electric Vehicle business, comprised of Hangzhou Jiyi Investment Management Co., Ltd., Hangzhou Wangbo Investment Management Co., Ltd., and its subsidiaries, Shangchi Automobile Co., Ltd. and Shenzhen Yimao New Energy Sales Co., Ltd., to a third party. We recorded gain from disposal of subsidiaries from continuing operations amounted to approximately $3.6 million in fiscal 2025.
On March 16, 2024, we signed a share transfer agreement with a third party to sell its 100% equity interest in Zhejiang Tantech Bamboo Charcoal Co., Ltd. ("Tantech Charcoal"). On December 25, 2024, we signed a share transfer agreement with a third party to sell its 100% equity interest in USCNHK Group Limited ("USCNHK") and its wholly owned subsidiaries, Tantech Holdings (Lishui) Co., Ltd., Hangzhou Tanbo Technology Co., Ltd. and Lishui Xincai Industrial Co., Ltd. We recorded losses from disposal of subsidiaries from continuing operations of approximately $1.0 million in fiscal 2024.
On December 29, 2023, we signed a share transfer agreement with a third party to sell 100% equity interest in Lishui Jikang Energy Technology Co., Ltd. and its subsidiary Tantech Bamboo. We recorded gain from disposal of subsidiaries from continuing operations amounted to approximately $3.6 million in fiscal 2023.
Gain from disposal of financing receivables
On April 25, 2025, our financing receivables balance was fully settled as partial consideration paid in connection with the equity acquisition agreement of Xintong international on April 18, 2025 (See Note 3). Gain from disposal of the financing receivables from continuing operations amounted to approximately $2.3 million in fiscal 2025.
Loss on refund receivable
On December 18, 2025, due to the delayed commercial development plan on the forests and plants, we renegotiated with the Seller of Xintong International Trading Co., Ltd. ("Xintong International") and both parties reached into agreement to unwind the acquisition transaction and repay the consideration (the "refund receivable") paid in four tranches, before March 31, 2028. The fair value of refund receivable was determined based on the present value of future repayments using the discounted rate. As a result, we recognized a loss on refund receivable from continuing operations amounted to approximately $4.4 million in fiscal 2025.
Gain on debt extinguishment
Gain on debt extinguishment derived from extinguishment of debt in accordance with ASC 470, the difference between the fair value of convertible notes immediately after the modification and the carrying value of convertible notes immediately before the modification was recognized as a gain of debt extinguishment from continuing operations of nil, approximately $0.3 million and nil in fiscal 2025, 2024 and 2023, respectively.
Other(expense) income, net
Other expense, net was primarily related to government subsidy income, settlement loss on loans payable to third parties, and other items. Our other expense, net was approximately $0.5 million in fiscal 2025, compared to other income, net approximately $0.03 million in fiscal 2024, due to settlement loss on loans payable to third parties.
(Loss) income before income tax
As a result of the foregoing, our loss before income tax from continuing operations was approximately $33.5 million in fiscal 2025, as compared with a net income from continuing operations of approximately $0.6 million in fiscal 2024. Our income before income tax from continuing operations decreased by $8.6 million, or 93.3%, to approximately $0.6 million in fiscal 2024, from approximately $9.3 million in fiscal 2023.
Income tax expense (benefit)
Our income tax benefit from continuing operations was approximately $2.5 million in fiscal 2025 from income tax expense approximately $3.1 million in fiscal 2024. The decreased income tax expense was in line with decreased taxable income.
Our income tax expense from continuing operations increased by approximately $0.7 million, or 31.6%, to approximately $3.1 million in fiscal 2024 from approximately $2.4 million in fiscal 2023. The increased income tax expense was due to higher taxable income in certain profitable subsidiaries.
Net income (loss) from continuing operations
As a result of the foregoing, our net loss from continuing operations increased by $28.5 million, or 1,145.7%, to approximately $31.0 million in fiscal 2025 from approximately $2.5 million in fiscal 2024. Our net loss from continuing operations was approximately $2.5 million in fiscal 2024, as compared with a net income from continuing operations of approximately $6.9 million in fiscal 2023.
Loss from discontinued operations
On May 15, 2025, we closed the sale of its Electric Vehicle business (the "EV Business"), comprised of 100% equity interest in Jiyi, 100% equity interest in Wangbo, 70% equity interest in Shangchi Automobile (51% equity held by Wangbo and 19% equity held by Jiyi) and 100% equity interest in Shenzhen Yimao held by Shangchi Automobile. The net loss for these discontinued operations was approximately $0.1 million, approximately $1.1 million and approximately $1.9 million in fiscal 2025, 2024 and 2023, respectively.
Net income (loss)
As a result of the foregoing, our net loss increased by $27.5 million, or 770.5%, to approximately $31.0 million in fiscal 2025 from approximately $3.6 million in fiscal 2024. Our net loss was approximately $3.6 million in fiscal 2024, as compared with a net income of approximately $5.0 million in fiscal 2023.
B. Liquidity and Capital Resources
We are a holding company incorporated in the British Virgin Islands. We may need dividends and other distributions on equity from our PRC subsidiaries to satisfy our liquidity requirements. Current PRC regulations permit our PRC subsidiaries to pay dividends to us only out of their accumulated profits, if any, determined in accordance with PRC accounting standards and regulations. In addition, our PRC subsidiaries are required to set aside at least 10% of their respective accumulated profits each year, if any, to fund certain reserve funds until the total amount set aside reaches 50% of their respective registered capital. Our PRC subsidiaries may also allocate a portion of their after-tax profits based on PRC accounting standards to employee welfare and bonus funds at their discretion. These reserves are not distributable as cash dividends.
As of December 31, 2025, we had cash of approximately $33.0 million. Our current assets were approximately $74.0 million and our current liabilities were approximately $11.2 million, which resulted in a current ratio of 6.6:1. Total shareholders' equity as of December 31, 2025 was approximately $110.3 million.
Our accounts receivable turnover in days were 392 days and 346 days for the years ended December 31, 2025 and 2024, respectively. Although we typically do not grant special payment terms to our customers, some of our customers, who are large retailers and wholesale chains, tend to require longer payment terms but are unlikely to default. The instances of slow payments and long-aging receivables may have negative impact on our short-term operating cash flow and future liquidity. We periodically review our accounts receivable and allowance level in order to ensure our methodology used to determine allowances is reasonable and accrued additional allowances if necessary. We have recently put a lot of efforts into accounts receivable collection through tightening our customer credit policy and strengthening monitoring of uncollected receivables. If we have difficulty collecting, the following steps will be taken, including but not limited to: cease any additional shipments to the customers, visit the customers to request payments on past due invoices, and if necessary, take legal recourse. If all of these steps are unsuccessful, management will determine whether or not the receivable will be reserved or written off.
For the accounts receivable, we provided credit losses of approximately $19.9 million against the aged accounts receivable balances. Subsequent to December 31, 2025 and through April 14, 2026, the Company collected approximately $9.0 million or 19% of the accounts receivable balance as of December 31, 2025.
The following table sets forth summary of our cash flows for the periods indicated:
(All amounts in thousands of U.S. dollars)
Years ended December 31,
2025
2024
2023
Net cash (used in) provided by continuing operations
Net cash used in discontinued operations
Net cash (used in) provided by operating activities
Net cash used in continuing operations
Net cash used in discontinued operations
Net cash used in investing activities
Net cash provided by continuing operations
Net cash (used in) provided by discontinued operations
Net cash provided by financing activities
Effect of exchange rate changes on cash and restricted cash
Net (decrease) increase in cash and restricted cash
Cash and restricted cash, beginning of year
Cash and restricted cash, end of year
Operating Activities
Net cash used in operating activities was approximately $5.8 million in fiscal 2025. Cash used in operating activities for the year ended December 31, 2025 mainly consisted of net loss from continuing operations of $31.0 million, non-cash items adjustment of approximately $34.8 million, an increase of approximately $13.1 million in accounts receivable due to slow collection, offset by a decrease of approximately $3.7 million in advances to suppliers.
Net cash provided by operating activities was approximately $5.4 million in fiscal 2024. Cash provided by operating activities for the year ended December 31, 2024 mainly consisted of net loss from continuing operations of $2.5 million, non-cash items adjustment of approximately $7.6 million, a decrease of approximately $4.9 million in accounts receivable due to stronger collection and an increase of approximately $1.1 million in tax payable, offset by increase of approximately $3.8 million in advances to suppliers, increase of approximately $0.6 million in prepaid expenses and other receivables and decrease of approximately $0.8 million in accounts payable.
Net cash provided by operating activities was approximately $5.3 million in fiscal 2023. Cash provided by operating activities for the year ended December 31, 2023 mainly consisted of net income of approximately $6.9 million, non-cash items adjustment of approximately $0.2 million, increase of approximately $1.3 million in accounts payable and increase of approximately $0.6 million in accrued liabilities and other payables, offset by an increase of approximately $3.5 million in accounts receivable due to slow collection.
Investing Activities
Net cash used in investing activities was approximately $1.1 million in fiscal 2025. The net cash used in investing activities in fiscal 2025 was primarily attributable to approximately $0.6 million increase in financing receivable and approximately $0.5 million increase in loans to third parties.
Net cash used in investing activities was approximately $3.3 million in fiscal 2024. The net cash used in investing activities in fiscal 2024 was primarily attributable to approximately $1.8 million increase in financing receivable and approximately $1.4 million in loans to third parties.
Net cash used in investing activities was approximately $2.6 million in fiscal 2023. The net cash used in investing activities in fiscal 2023 consisted of approximately $2.2 million in financing receivable, approximately $0.2 million in additions to intangible assets and approximately $0.2 million used in discontinued operation.
Financing Activities
Net cash provided by financing activities was approximately $3.4 million in fiscal 2025. Net cash provided by financing activities in fiscal 2025 was mainly consisting of proceeds from loans payable to third parties of approximately $3.4 million, proceeds from exercising of warrants of approximately $0.4 million and proceeds from related parties of approximately $0.3 million, offset by paid issuance of common stock and warrants cost of approximately $0.5 million and repayment to related parties of approximately $0.2 million.
Net cash provided by financing activities was approximately $3.5 million in fiscal 2024. Net cash provided by financing activities in fiscal 2024 was mainly consisting of proceeds from exercising of warrants of approximately $3.2 million, proceeds from issuance of common stock and warrants of approximately $1.7 million, proceeds from loans from third parties of approximately $2.2 million, offset by repayment of loans from third parties of approximately $2.4 million, repayment of loans from related parties of approximately $1.0 million and repayment of convertible note of approximately $0.3 million.
Net cash provided by financing activities was approximately $7.4 million in fiscal 2023. Net cash provided by financing activities in fiscal 2023 was primarily due to two offerings of 2,240,000 common shares, which resulted in net proceeds of approximately $5.8 million and net proceeds of approximately $2.0 million from the issuance of a convertible note in fiscal 2023.
Our primary source of cash is currently generated from the sales of our products and financings. In the coming years, we are planning to continue to raise additional capital by issuing common shares to meet our cash needs. While facing uncertainties in regard to the size and timing of capital raise, we expect to be able to meet our working capital and capital expenditure requirements by using our cash on hand, cash flows from operations and bank borrowings in the next twelve months.
Capital Expenditures
We had capital expenditures of $nil, $0.08 million and $0.2 million for the years ended December 31, 2025, 2024 and 2023, respectively for the addition in property, plant and equipment and intangible assets.
We expect that our capital expenditures will increase in the future as our business continues to develop and expand. We have used cash generated from our subsidiaries' operations to fund our capital commitments in the past and anticipate using such funds and proceeds received from our offerings through issuance of common stocks and other sources to fund capital expenditure commitments in the future.
Off-balance Sheet Arrangements
We have no off-balance sheet arrangements including arrangements that would affect our liquidity, capital resources, market risk support and credit risk support or other benefits.
C. Research and Development, Patents and Licenses, etc.
See "Item 4. Information on the Company-B. Business Overview-Research and Development" and "Item 4. Information on the Company-B. Business Overview-Our Patents" of our annual report.
D. Trend Information
Market Trends
Other than as disclosed elsewhere in this financial report, we are not aware of any trends, uncertainties, demands, commitments or events that are reasonably likely to have a material and adverse effect on our net revenues, income, profitability, liquidity or capital resources, or that would cause the disclosed financial information to be not necessarily indicative of future results of operations or financial condition.
E. Critical Accounting Estimate
In preparing the financial statements we have made estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Accounting estimates are deemed critical if they involve a significant level of estimation uncertainty and have had or are reasonably likely to have a material impact on our financial condition or results of operations.
A summary of our significant accounting policies which are important to the portrayal of our financial condition and results of operations is set forth in Note 2 to our financial statements included elsewhere in this filing. An accounting policy is considered critical if it requires an accounting estimate to be made based on assumptions about matters that are uncertain and requires significant judgment at the time such estimate is made, and if different accounting estimates that reasonably could have been used, or changes in the accounting estimates that are reasonably likely to occur periodically, could materially impact the consolidated financial statements.
Impairment of Long-term Investments
We evaluate our long-term investments for impairment whenever events or changes in circumstances indicate that the carrying value may not be recoverable. For the year ended December 31, 2025, we determined that certain investments were other-than-temporarily impaired and recorded charges to reduce their carrying values to an estimated fair value of nil. These fair value measurements represent "Level 3" measurements as they rely on significant unobservable inputs. Specifically, we utilized an income approach (discounted cash flow method) which requires management to make highly subjective estimates regarding future cash flows, long-term revenue growth rates, and discount rates that reflect the specific regulatory and economic risks of the investees' operations in China. Our determination of a nil fair value was primarily driven by management's judgment regarding the permanence of government-imposed mining prohibitions and shifting market demand. These estimates are sensitive to change; if our assumptions regarding the duration of regulatory restrictions or future market conditions were to differ, the resulting fair value could be materially different.
Disclaimer
Tantech Holdings Ltd. published this content on May 14, 2026, and is solely responsible for the information contained herein. Distributed via Public Technologies (PUBT), unedited and unaltered, on May 14, 2026 at 20:40 UTC.