Clean Energy Technologies, Inc.
For the period ended Dec 31, 2024. Filed Apr 14, 2025.
View on SEC.govAbout this filing
A company's yearly report to the SEC, with audited financial statements. It is the fullest account a company gives of its business, its finances and the risks it sees.
FY2024 · Filed Apr 14, 2025
CETY$0.89+3.1%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-K
Period ended 2023-12-31; filed 2024-04-17.
0001493152-24-014897
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-K
Period ended 2024-12-31; filed 2025-04-14.
0001641172-25-003950
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 136 previous paragraphs and 152 current paragraphs.
95 unchanged; 23 reworded; 34 added; 18 removed; 0 previous and 0 current paragraphs rearranged.
Tables are not compared: 11 previous and 13 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (34)
Current report
This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, adopted pursuant to the Private Securities Litigation Reform Act of 1995. Statements that are not purely historical may be forward-looking. For example, statements in this Annual Report regarding our plans, strategy and focus areas are forward-looking statements. You can identify some forward-looking statements by the use of words such as “believe,” “anticipate,” “expect,” “intend,” “goal,” “plan,” and similar expressions. Forward-looking statements involve inherent risks and uncertainties regarding events, conditions and financial trends that may affect our future plans of operation, business strategy, results of operations and financial position.
Current report
A number of important factors could cause actual results to differ materially from those included within or contemplated by such forward-looking statements, including, but not limited to risks relating to pandemics, the ongoing war in Ukraine and the conflict in Israel and their impact on the global economy, trade tariffs and threats of trade tariffs and their impact on localized economies, our history of losses, our dependence on key members of our management and development team, and our ability to generate and/or obtain adequate capital to fund future operations.
Current report
For a discussion of these and other factors that could cause actual results to differ from those contemplated in the forward-looking statements, please see the discussion under “Risk Factors” in our other publicly available filings with the Securities and Exchange Commission. Forward-looking statements reflect our analysis only as of the date of this Annual Report on Form 10-K.
Current report
Because actual events or results may differ materially from those discussed in or implied by forward-looking statements made by us or on our behalf, you should not place undue reliance on any forward-looking statement. We do not undertake responsibility to update or revise any of these factors or to announce publicly any revision to forward-looking statements, whether as a result of new information, future events or otherwise.
Current report
The following discussion and analysis should be read in conjunction with the consolidated financial statements and the notes thereto included in Item 8 of this Annual Report on Form 10-K.
Current report
For the fiscal year closing on December 31, 2024, our company reported a net loss amounting to $4,416,319, to the net loss of $5,782,666 before non-controlling interest and tax we achieved during the equivalent period in 2023. CETY’s net loss was impacted by a shift in our revenue mix, with lower business from China, which historically had lower margins, and an increasing focus on higher-margin opportunities from our waste-to-energy business. Additionally, while interest and financing fees were lower compared to previous periods, they remained high due to delays in our registration becoming effective. These factors contributed to the overall financial performance for the period.
Current report
Following the close of the 2024 fiscal year, CETY’s equity saw a significant decrease, dropping from $4,444,038 to $2,938,502, as reflected in our quarterly financials. This decline was primarily driven by ongoing investments in our waste-to-energy business, the impact of lower-margin revenue from China, and continued financing costs. Despite this, our strategic focus on higher-margin opportunities positions us for stronger long-term growth and improved financial performance.
Current report
For the year ending December 31, 2024, our total revenue was $2,424,659 compared to $6,693,844 for the same period in 2023. The Company has four reportable segments: CETY Renewables division, Clean Energy HRS (HRS) and CETY Europe, the engineering and program management services division, and CETY HK.
Current report
For the year ended December 31, 2024, our revenue from HRS was $158,141 compared to $497,584 for the same period in 2023. The decrease in revenue for Heat Recovery Solutions (HRS) and ORC systems in 2024 compared to 2023 was primarily due to project delays and longer sales cycles associated with supply chain disruptions and extended customer decision-making processes. Additionally, some key contracts that were expected to close in 2024 were pushed into 2025 due to permitting and financing challenges faced by customers. The lower revenue also reflects a strategic shift toward larger-scale projects, which have longer development timelines but are expected to generate higher future revenues.
Current report
For the fiscal year ending December 31, 2024, our revenue from the NG business reached $1,192,420, a significant drop from $5,719,170 in the corresponding period of 2023. The decline in revenue from our NG business in 2024 compared to 2023 was primarily due to lower demand in China, driven by economic factors and shifts in energy consumption patterns. Additionally, increased competition and more competitive pricing in the market pressured margins, leading to a significant drop in revenue. These factors contributed to a slower sales cycle and reduced order volume compared to the previous year.
Current report
For the year ending December 31, 2024, our gross profit increased to $846,555 compared to $460,835 for the same period in 2023. This growth was achieved despite a significant decline in revenue, primarily due to the slowdown in CETY HK’s natural gas business. The increase in gross profit reflects improved operational efficiencies and a stronger revenue mix from higher-margin segments, including CETY Renewables. However, the overall gross margin percentage declined, largely due to the lower-margin nature of the China natural gas business and increased competition in that market. Moving forward, we remain focused on expanding our higher-margin renewable energy and waste-to-energy solutions to drive sustainable profitability.
Current report
For the year ended December 31, 2024, our gross profit from HRS was $19,206 compared to $121,905 for the same period in 2023; This decrease was primarily due to delays in booking and shipping products, as customers were evaluating their sites and waiting for clarity on economic factors driven by the U.S. government’s pending tax incentive programs and the release of new guidelines at the end of 2024, compounded by the election year uncertainties.
Current report
For the year ended December 31, 2024, our gross profit from CETY HK improved to $(6,195), compared to $(35,379) for the same period in 2023. While overall market conditions for the natural gas business in China remained challenging, we were able to mitigate some losses through operational efficiencies and pricing adjustments.
Current report
For the year ending December 31, 2024, our Selling, General, and Administrative (SG&A) expenses increased to $797,518, compared to $679,004 in 2023. This increase was primarily driven by expanded investments in Media and Investor Relations, marketing efforts, and sales initiatives aimed at supporting business growth. Increased spending on subscription services and IT infrastructure. Furthermore, the rise in SG&A includes expenses related to inducement shares issued in connection with inducement shares for various notes, contributing to the overall increase in administrative costs.
Current report
Salary Expense
Current report
For the fiscal year ending December 31, 2024, our total salaries increased to $1,906,701, compared to $1,570,909 in 2023. This increase was primarily driven by the expansion of our CETY Renewables team to support the growth of our waste-to-energy business, as well as salary increases in our China operations. These strategic investments in personnel were necessary to strengthen our capabilities, drive project execution, and support long-term business expansion.
Current report
For the year ending December 31, 2024, our travel expenses totaled $185,876, compared to $247,124 for the same period in 2023. This reduction in expenditure is primarily due to a decrease in travel costs from both the US and Europe.
Current report
For the fiscal year ending December 31, 2024, our Facility Lease expense amounted to $285,823, a slight decrease from $310,004 in 2023. This reduction reflects our ongoing efforts to lower lease costs through renegotiations and our focus on more efficient operations. We have continuously worked to optimize our space utilization and streamline processes, contributing to this modest reduction in lease expenses.
Current report
For the fiscal year ending December 31, 2024, our total expenses for Investor Relations (IR), marketing, and contractors related to the VRG project were $195,640, compared to $196,301 for the same period in 2023. This represents a very slight decrease in expenses, reflecting our continued focus on cost management while maintaining efforts to support the VRG project.
Current report
For the fiscal year ending December 31, 2024, our Professional Fees expense amounted to $578,937, up from $356,785 in the same period of 2023. This increase was primarily due to higher costs associated with engaging a new auditor, as well as the increased expenses tied to our status as a Nasdaq-listed company and expenses associated with our SEC filings.
Current report
For the year ended December 31, 2024, we recorded gain of $8,135, compared to a loss of $1,124,654 for the same period in 2023. The loss in 2024 was primarily attributable to the deconsolidation of Shuya, while the 2023 loss was due to the fair market valuation of preferred shares.
Current report
For the year ended December 31, 2024, interest and finance fees totaled $1,199,042, compared to $2,137,649 for the same period in 2023. The decrease was primarily due to a reduction in convertible notes, bridge financing fees, and interest. However, we still incurred significant financing fees and higher interest costs due to delays in our registration statement becoming effective, delays in funding, and the need to rely on more expensive debt during the year.
Current report
Cash Flow Summary
Current report
The following table presents the Company’s material contractual obligations as of December 31, 2024:
Current report
In July 2022, JHJ and other three shareholders agreed to form and make total capital contribution of RMB 20 million ($2.81 million) with latest contribution due date in February 2066 into Sichuan Hongzuo Shuya Energy Limited (“Shuya”), JHK owns 20% of Shuya. In August 2022, JHJ purchased 100% ownership of Sichuan Shunengwei Energy Technology Limited (“SSET”) for $0, who owns 29% of Shuya; Shunengwei is a holding company and did not have any operations nor made any capital contribution into Shuya as of the ownership purchase date by JHJ; right after the ownership purchase of SSET, JHJ ultimately owns 49% of Shuya.
Current report
Shuya was set up as the operating entity for pipeline natural gas (PNG) and compressed natural gas (CNG) trading business, while the other two shareholders of Shuaya have large supply relationships.
Current report
For the year ended December 31, 2022, the Company has determined that Shuya was not a VIE and has evaluated its consolidation analysis under the voting interest model. Because the Company does not own greater than 50% of the outstanding voting shares, either directly or indirectly, it has accounted for its investment in Shuya under the equity method of accounting. Under this method, the investor (“JHJ”) recognizes its share of the profits and losses of the investee (“Shuya”) in the periods when these profits and losses are also reflected in the accounts of the investee. Any profit or loss recognized by the investing entity appears in its income statement. Also, any recognized profit increases the investment recorded by the investing entity, while a recognized loss decreases the investment.
Current report
JHJ made a investment of RMB 3.91 million ($0.55 million) into Shuya during the 12 months ended December 31, 2022 recorded in accordance with ASC 323. Shuya had a net loss of approximately $10,750 during the year ending December 31, 2022, of which approximately $5,000 was allocated to the company, reducing the investment by that amount.
Current report
The change of control interest was accounted for using the acquisition method of accounting in accordance with Accounting Standards Codification, referred to as ASC, 805, Business Combinations. The management determined that the Company was the acquiror for financial accounting purposes. In identifying the Company as the accounting acquiror, the companies considered the structure of the transaction and other actions contemplated by the Three-Parties Consistent Action Agreement, relative outstanding share ownership and market values, the composition of the combined company’s board of directors, the relative size of Shuya, and the designation of certain senior management positions of the combined company.
Current report
In accordance with ASC 805, the Company recorded the acquisition based on the fair value of the consideration transferred and then allocated the purchase price to the identifiable assets acquired and liabilities assumed based on their respective fair values as of the Acquisition Date. The excess of the value of consideration transferred over the aggregate fair value of those net assets was recorded as goodwill. Any identified definite lived intangible assets will be amortized over their estimated useful lives and any identified intangible assets with indefinite useful lives and goodwill will not be amortized but will be tested for impairment at least annually. All intangible assets and goodwill will be tested for impairment when certain indicators are present. Determining the fair value of assets acquired and liabilities assumed requires management to use significant judgment and estimates including the selection of valuation methodologies, estimates of future revenues and cash flows, discount rates, and selection of comparable companies. The valuation of purchase considerations was based on preliminary estimates that management believes are reasonable under the circumstances.
Current report
As the Consistent Action Agreement did not quantify any considerations to gain the control, the deemed consideration paid is the fair value of 51% non-controlling interest as of January 1, 2023. The following table summarizes the fair value of the consideration paid and the fair value of assets acquired, and liabilities assumed on January 1, 2023, the acquisition date.
Current report
Under ASC-805-10-50-2, initial consolidation of an investee previously reported using fair value or the equity method should be accounted for prospectively as of the date the entity obtained a controlling financial interest. Therefore, the Company should provide pro forma information as if the consolidation had occurred as of the beginning of each of the current and prior comparative reporting period per
Current report
Under ASC-805-10-50-2, initial consolidation of an investee previously reported using fair value or the equity method should be accounted for prospectively as of the date the entity obtained a controlling financial interest. Therefore, the Company should provide pro forma information as if the consolidation had occurred as of the beginning of each of the current and prior comparative reporting period per
Current report
On January 1, 2024, and effective on the same date, JHJ, SSET and Xiangyueheng entered into the Agreement on the Termination of the Concerted Action Agreement (the “Termination Agreement”), pursuant to which the parties released each other from any and all obligations under the CAA. Due to the Termination Agreement, the Company now holds less than 50% of the voting rights in Shuya. The Company analyzed whether Shuya should be consolidated under ASC 810 and determined Shuya is no longer required to be consolidated on January 1, 2024 after the execution of the Termination Agreement. Accordingly, the Company will not consolidate Shuya into its consolidated financial statements on or after January 1, 2024.
Removed paragraphs (18)
Previous report
This Management’s Discussion and Analysis of Financial Condition and Results of Operations (MD&A) contains forward-looking statements that involve known and unknown risks, significant uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity, performance or achievements expressed, or implied, by those forward-looking statements. You can identify forward-looking statements by the use of the words may, will, should, could, expects, plans, anticipates, believes, estimates, predicts, intends, potential, proposed, or continue or the negative of those terms. These statements are only predictions. In evaluating these statements, you should consider various factors which may cause our actual results to differ materially from any forward-looking statements. Although we believe that the exceptions reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Therefore, actual results may differ materially and adversely from those expressed in any forward-looking statements. We undertake no obligation to revise or update publicly any forward-looking statements for any reason.
Previous report
For the fiscal year closing on December 31, 2023, our company reported a net loss amounting to $5,531,762, to the net profit of $147,395 we achieved during the equivalent period in 2022. This downturn in profitability for 2023 can largely be attributed to several key factors: our strategic expansion which included the integration of two new business ventures, a rise in employee compensation and general overhead costs, diminished profit margins within our NG operations, significantly increased overhead expenses following our listing on NASDAQ, and a notable uptick in interest expenses and fees related to convertible debts and bridge loans, marking a higher interest expenditure compared to the previous year.
Previous report
Following the close of the 2022 fiscal year, the company’s equity for the fiscal year ending in 2023 saw a significant increase, rising from 1,878,196 to 5,111,982. This remarkable growth is primarily attributed to the success of the company’s public offering, which generated gross proceeds of $3.9 million, and conversion of some of its convertible notes into Series E preferred shares. Looking ahead, the company is poised for further growth with the anticipated launch of its biomass project in Vermont in 2024, which is expected to contribute to both profitability and growth. Additionally, the company’s ability to secure funding has been greatly enhanced following its listing on the Nasdaq on March 23, 2023. With a focus on optimizing operations and expanding global sales, management is confident in the company’s ability to sustain long-term profitability and maintain a strong capital position.
Previous report
For the year ended December 31, 2023, our total revenue was $15,113,463 compared to $2,663,212 for the same period in 2022. The Company has four reportable segments: Clean Energy HRS (HRS), CETY Europe and the engineering & manufacturing services division, CETY HK.
Previous report
For the year ended December 31, 2023, our revenue from HRS was $497,584 compared to $488,453 for the same period in 2022. However, we’re optimistic that the new government incentives will support an increase in revenue from our heat recovery solutions.
Previous report
For the fiscal year ending December 31, 2023, our revenue from the NG business reached $14,138,789, a significant rise from $1,890,439 in the corresponding period of 2022. This substantial growth can be attributed to our enhanced capacity to secure additional NG allocations, coupled with the successful consolidation of our newly established joint venture.
Previous report
For the year ending December 31, 2023, our gross profit was $1,090,254, compared to $1,174,196 for the same period in 2022. It’s important to note that our gross profit margins can fluctuate due to a variety of factors, such as changes in production and supply chain efficiencies, material costs, logistics, and personnel expenses. The decrease in our gross profit for the year can be primarily attributed to the incorporation of additional revenue from our newly formed entity, CETY HK, which operates at lower margins.
Previous report
For the year ended December 31, 2023, our gross profit from HRS was $157,179 compared to $459,362 for the same period in 2022, the decrease was due to lower revenue.
Previous report
For the year ended December 31,2023, our gross profit from CETY HK was $594,041, compared to $631,082 for the same period in 2022.
Previous report
For the year ending December 31, 2023, our Selling, General, and Administrative (SG&A) expenses amounted to $684,893, a rise from $400,322 in the corresponding period of 2022. This increase is largely due to enhanced spending across various sectors, notably in Media and Investor Relations, marketing, sales initiatives, the transition to a new facility, the launch of two new businesses, subscription services, and IT-related costs.
Previous report
Salaries Expense
Previous report
For the fiscal year concluding on December 31, 2023, our total salaries expense amounted to $1,671,071, marking a significant increase from the previous year’s total of $782,657. The escalation in expenses for 2023 can be largely ascribed to the expansion of our team, including the hiring of a Chief Financial Officer, two directors responsible for operations and technology, four engineers, and additional personnel within our NG trading sector.
Previous report
For the year concluding on December 31, 2023, our travel expenditure amounted to $405,334, in contrast to $166,025 for the corresponding timeframe in 2022. This increase in expenses is attributed to our efforts in expanding our business in Asia, specifically concerning the NG trading sector.
Previous report
For the fiscal year concluding on December 31, 2023, our Facility Lease expense totaled $401,293, as opposed to $349,610 for the corresponding period in 2022. This rise can be attributed to the addition of a new lease for our operations in China.
Previous report
For the fiscal year ending December 31, 2023, our consulting expense amounted to $199,594, representing a notable increase from $119,896 recorded during the corresponding period in 2022. This rise can be attributed to the engagement of investor relations and marketing sub-contractors.
Previous report
For the fiscal year ending December 31, 2023, our Professional fees expense totaled $356,785, reflecting an uptick from $315,361 recorded during the same period in 2022. This increase in fees was primarily driven by elevated expenses associated with engaging a new auditor.
Previous report
For the year ended December 31, 2023, we had no gain on debt settlement.
Previous report
For the year ended December 31, 2023 interest and finance fees were $2,137,649 compared to $1,125,395 for the same period in 2022. The increase was mainly due to increase in additional convertible notes, bridge financing fees and interest, and additional a loss of 1,255,084 on convertible conversion preferred shares.
Reworded paragraphs (23)
Previous wording
Our principal executive offices are located at 1340 Reynolds Avenue Unit 120, Irvine, California 92614. Our telephone number is (949) 273-4990. Our common stock is listed on the NASDAQ Markets under the symbol “CETY.”
Current wording
Our principal executive offices are located at 1340 Reynolds Avenue Unit 120, Irvine, California 92614. Our common stock is listed on the NASDAQ Markets under the symbol “CETY.”
Previous wording
Our internet website address iswww.cetyinc.com and our subsidiary’s web site iswww.heatrecoverysolutions.com The information contained on our websites are not incorporated by reference into this document, and you should not consider any information contained on, or that can be accessed through, our website as part of this document.
Current wording
Our internet website address iswww.cetyinc.com. The information contained on our websites are not incorporated by reference into this document, and you should not consider any information contained on, or that can be accessed through, our website as part of this document.
Previous wording
The Company has four reportable segments: Clean Energy HRS (HRS), CETY Renewables waste to energy solutions, engineering and manufacturing services, and CETY HK natural gas trading business.
Current wording
The Company has four reportable segments: Clean Energy HRS (HRS), CETY Renewables waste to energy solutions, engineering, procurement, construction and program management services, and CETY HK natural gas trading business.
Previous wording
We specialize in renewable energy & energy efficiency systems design, manufacturing and project implementation. We were incorporated in California in July 1995 under the name Probe Manufacturing Industries, Inc. We redomiciled to Nevada in April 2005 under the name Probe Manufacturing, Inc. We provided engineering and manufacturing electronics services to original equipment manufacturers (OEMs) of clean energy, industrial, automotive, semiconductor, medical, communication, military, and high technology products.
Current wording
We offer turnkey energy solutions leveraging our technologies and solutions to provide green energy solutions, clean energy fuels and alternative electricity. We were incorporated in California in July 1995 under the name Probe Manufacturing Industries, Inc. We redomiciled to Nevada in April 2005 under the name Probe Manufacturing, Inc. We provided engineering and manufacturing electronics services to original equipment manufacturers (OEMs) of clean energy, industrial, automotive, semiconductor, medical, communication, military, and high technology products.
Previous wording
With the vision to combat climate change and creating a better, cleaner and environmentally sustainable future, we formed Clean Energy HRS, LLC a wholly owned subsidiary of Clean Energy Technologies, Inc. and acquired the assets of Heat Recovery Solutions from General Electric International on September 11, 2015. In November 2015, we changed our name to Clean Energy Technologies, Inc. Our principal executive offices are located at 1340 Reynolds Avenue Unit 120, Irvine, CA 92614. We have 20 full-time employees. All employees and overhead are shared between Clean Energy Technologies, Inc. (which still provides the contract electronic manufacturing services) and Clean Energy HRS, LLC, waste to energy business unit, and our natural gas trading business.
Current wording
With the vision to combat climate change and creating a better, cleaner and environmentally sustainable future, we formed Clean Energy HRS, LLC a wholly owned subsidiary of Clean Energy Technologies, Inc. and acquired the assets of Heat Recovery Solutions from General Electric International on September 11, 2015. In November 2015, we changed our name to Clean Energy Technologies, Inc. Our principal executive offices are located at 1340 Reynolds Avenue Unit 120, Irvine, CA 92614. We have 22 full-time employees. All employees and overhead are shared between Clean Energy Technologies, Inc, Clean Energy HRS, LLC, waste to energy business unit, engineering solutions, and our natural gas trading business.
Previous wording
The Company has four reportable segments: Clean Energy HRS (HRS) and CETY Europe, CETY Renewables, CETY HK and engineering and manufacturing services division.
Current wording
The Company has four reportable segments: Clean Energy HRS (HRS) and CETY Europe, CETY Renewables, CETY HK and CETY engineering solution services division. During the reporting period, the Company made the strategic decision to discontinue its involvement in the Shuya operations, which was previously aligned under the CETY HK segment. This decision reflects a broader effort to sharpen the Company’s focus on its core competencies and highest-value opportunities in waste-to-energy, heat recovery, and eco-friendly energy solutions.
Previous wording
We develop renewable energy products and solutions and establish partnerships in renewable energy that make environmental and economic sense. Our mission is to be a segment leader in the Zero Emission Revolution by offering eco-friendly energy solutions, clean energy fuels and alternative electric power for small and mid-sized projects in North America, Europe, and Asia. We target sustainable energy solutions that are profitable for us, profitable for our customers and represent the future of global energy production.
Current wording
We provide turnkey energy solutions leveraging our technologies, including power generation, heat recovery, and waste to energy to deliver green energy solutions, clean energy fuels, and alternative electricity to small and midsize projects in North America, Europe, and ASEAN markets that make environmental and economic sense. Our mission is to be a segment leader in the Zero Emission Revolution by offering eco-friendly energy solutions for a sustainable future. We target sustainable energy solutions that are profitable for us, profitable for our customers and represent the future of global energy production.
Previous wording
Engineering, Consulting and Project Management Solutions – we bring a wealth of experience in developing clean energy projects for municipal and industrial customers and Engineering, Procurement and Construction (EPC) companies so they can identify, design, and incorporate clean energy solutions in their projects.
Current wording
Engineering, Consulting and Project Management Solutions – we bring a wealth of experience in developing clean energy projects for municipal and industrial customers and Engineering, Project Development companies so they can identify, design, and incorporate clean energy solutions in their projects.
Previous wording
We design, produce and market clean energy products and integrated solutions focused on energy efficiency and renewable energy. Our aim is to become a leading provider of renewable and energy efficiency products and solutions by helping commercial companies and municipalities reduce energy waste and emissions, lower energy costs and generate incremental revenue by providing electricity, renewable natural gas and biochar to the grid.
Current wording
We design, produce and market clean energy products and integrated solutions focused on energy efficiency and renewable energy. Our aim is to become a leading provider of renewable and energy efficiency products and solutions by helping commercial companies and municipalities reduce energy waste and emissions, lower energy costs and generate incremental revenue by providing electricity, renewable natural gas, hydrogen and biochar to the grid.
Previous wording
The financial statements have been prepared on a going concern basis, which contemplates continuity of operations, realization of assets and liquidation of liabilities in the normal course of business. The Company had a total stockholder’s equity of $5,869,198 and a working capital deficit of $1,949,205 and an accumulated deficit of $22,984,163 as of December 31, 2023 and used $4,783,077 in net cash from operating activities for the year ended December 31, 2023. CETY has a clear strategy in place and has the capability to successfully restructure its existing debt and secure additional financing. With its current strategic approach and diversification of its products and solutions, the management has created a favorable environment for the company to transition towards profitability.
Current wording
The financial statements have been prepared on a going concern basis, which contemplates continuity of operations, realization of assets and liquidation of liabilities in the normal course of business. The Company had a total stockholder’s equity of $2,938,502 and a working capital deficit of $3,240,008 and an accumulated deficit of $27,443,231 as of December 31, 2024 and used $3,560,950 in net cash from operating activities for the year ended December 31, 2024. CETY has a clear strategy in place and has the capability to successfully restructure its existing debt and secure additional financing. With its current strategic approach and diversification of its products and solutions, the management has created a favorable environment for the company to transition towards profitability.
Previous wording
For the fiscal year ending December 31, 2023, our revenue from Engineering and Manufacturing amounted to $47,091, a decrease from $203,078 for the corresponding period in 2022. This decline can be attributed to the phased closure of our legacy manufacturing operations and a strategic reallocation of resources towards becoming a fully integrated clean energy solution provider, thereby strengthening support for our other technology segments.
Current wording
For the fiscal year ending December 31, 2024, our revenue from Engineering and Manufacturing amounted to $9,341, a decrease from $47,091 for the corresponding period in 2023. This decline is due to the gradual shutdown of our legacy manufacturing operations and the strategic reallocation of resources towards becoming a turnkey provider of technology energy solutions, thus enhancing support for our other advanced technology segments. Going forward, our power generation site design and integration for data centers and industrial operations will be assigned to this segment.
Previous wording
For the fiscal year ending December 31, 2023, our revenue from CETY Renewables, our newly launched waste-to-energy business, amounted to $429,999. There was no revenue generated from this segment in the preceding year.
Current wording
For the fiscal year ending December 31, 2024, our revenue from CETY Renewables, our newly launched waste-to-energy business, amounted to $1,064,757 compared to $429,999 for the same period in 2023. The increase in revenue from CETY Renewables in 2024 compared to 2023 was primarily driven by the continued development and progress of the VRG project, which advanced through critical permitting and early-stage construction design phases. The rise in revenue also aligns with our strategic efforts to scale operations and establish a stronger market presence in the renewable energy sector.
Previous wording
For the year ended December 31, 2023, our gross profit from CETY Renewables was $392,298.
Current wording
For the year ended December 31, 2024, our gross profit from CETY Renewables increased to $829,784, compared to $355,303 for the same period in 2023. This growth reflects the expansion of our higher-margin waste-to-energy business, which in 2024 consisted of engineering, project development, and services with minimal material costs. The strong profitability of this segment underscores our strategic focus on delivering turnkey renewable energy solutions that generate long-term value while maintaining a lean cost structure.
Previous wording
For the year ended December 31, 2023, our depreciation and amortization expense was $26,692 compared to $30,076 for the same period in 2022.
Current wording
For the year ended December 31, 2024, our depreciation and amortization expense was $8,907 compared to $26,692 for the same period in 2024.
Previous wording
For the fiscal year ending on December 31, 2023, our net loss from operations amounted to $(2,655,408), a notable increase compared to the net loss from operations of $989,751 for the corresponding period in 2022. This rise in loss during 2023 can be attributed primarily to the expansion of our team, our uplisting to NASDAQ, and the expansion of our global business operations, as well as a decrease in margin revenue from our NG business.
Current wording
For the fiscal year ending December 31, 2024, our net loss from operations totaled $3,112,847, an increase compared to the net loss of $2,925,984 for the same period in 2023. This rise in loss is primarily due to the expansion of our team, our uplisting to Nasdaq, and the growth of our global business operations, as well as a decline in revenue from our NG business. Although revenue dropped substantially, our net loss remained relatively close to the losses incurred in 2023, reflecting our efforts to manage costs despite the challenges.
Previous wording
For the year ended December 31, 2023, we had a loss on derivative liability of $326,539 compared to a gain of $331,495 for the same period in 2022. The gain in derivative liability was from favorable derivative calculations and payoffs from several convertible notes.
Current wording
For the year ended December 31, 2024, we had $0 compared to loss on derivative liability of $326,539 for the same period in 2023. The decrease in loss on derivative liability was due to maturity date and expiration of the notes.
Previous wording
If the entity obtains control over one of the above before the good or service is transferred to a customer, the entity could be considered aprincipal.
Current wording
If the entity obtains control over one of the above before the good or service is transferred to a customer, the entity could be considered a principal.
Previous wording
Secondly, CETY identifies the performance obligations of the Parties in performance of the EPC Agreement in accordance with 606-10-25-14. At contract inception, CETY assesses the goods and services necessary to deliver the facility in accordance with the its agreement with its clients. The agreement specifically laid out all deliverables necessary to achieve the permitting, design, procurement, construction, and commissioning.
Current wording
Secondly, CETY identifies the performance obligations of the Parties in performance of the EPC Agreement in accordance with 606-10-25-14. At contract inception, CETY assesses the goods and services necessary to deliver the facility in accordance with the agreement with its clients. The agreement specifically laid out all deliverables necessary to achieve the permitting, design, procurement, construction, and commissioning.
Previous wording
Finally, in identifying a single method of measuring progress for each performance obligation satisfied over time, in accordance with 606-10-25-32, CETY applies the methodology of 606-10-25-36. CETY adopted and implemented the input method for revenue recognition in accordance with ASC 606-10-25-33. The compnpany adopts the input method for implementation. CETY recognizes revenue for performance obligations on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation per 606-10-55-20.
Current wording
Finally, in identifying a single method of measuring progress for each performance obligation satisfied over time, in accordance with 606-10-25-32, CETY applies the methodology of 606-10-25-36. CETY adopted and implemented the input method for revenue recognition in accordance with ASC 606-10-25-33. The company adopts the input method for implementation. CETY recognizes revenue for performance obligations on the basis of the entity’s efforts or inputs to the satisfaction of a performance obligation per 606-10-55-20.
Previous wording
Also, from time to time our contracts state that the customer is not obligated to pay a final payment until the units are commissioned, i.e. a final payment of 10%. As of December 31, 2023 and 2022 we had $33,000 and 33,000 of deferred revenue, which is expected to be recognized in the second quarter of year 2024.
Current wording
Also, from time-to-time, our contracts state that the customer is not obligated to pay a final payment until the units are commissioned, i.e. a final payment of 10%. As of December 31, 2024 and 2023 we had $33,000 and $33,000 of deferred revenue, which is expected to be recognized in the second quarter of year 2025.
Previous wording
Also from time to time we require upfront deposits from our customers based on the contract. As of December 31, 2023 and 2022, we had outstanding customer deposits of $210,310 and $80,475 respectively.
Current wording
Also, from time-to-time, we require upfront deposits from our customers based on the contract. As of December 31, 2024 and 2023, we had outstanding customer deposits of $30,061 and $165,236, respectively.
Previous wording
Chengdu Xiangyueheng Enterprise Management Co., Ltd (the “Xiangyueheng”), which owns a 10% equity interest in Shuya, entered a three-party Concerted Action Agreement (the “CAA”), wherein the parties agreed to vote in unison at the shareholders’ meeting of Shuya to consolidate the controlling position of the three parties in Shuya. The three parties agreed that during the term of the CAA, before any of the three parties intends to propose motions to the shareholders’ meetings or the board of directors, or exercise their voting rights on any matter that shall be presented to and resolved through the shareholders’ meeting in accordance with the laws, regulations, Articles of Association of Shuya or any relevant shareholders’ agreements, the three parties will discuss, negotiate, and coordinate the motion topics for consistency; in the event of disagreement, the opinions of JHJ shall prevail.
Current wording
However, effective January 1, 2023, JHJ, SSET and Chengdu Xiangyueheng Enterprise Management Co., Ltd (“Xiangyueheng), who is the 10% shareholder of Shuya, entered a Three-Parties Consistent Action Agreement, wherein these three shareholders (or three parties) will guarantee that the voting rights will be expressed in the same way at the shareholders’ meeting of Shuya to consolidate the controlling position of the three parties in Shuya. The three parties agree that within the validity period of this agreement, before the party intends to propose the motions to the shareholders or the board of directors on the major matters related to the voting rights of the shareholders or the board of directors, the three parties internally will discuss, negotiate and coordinate the motion topics for consistency; in the event of disagreement, the opinions of JHJ shall prevail.
Previous wording
As a result of the CAA, the Company re-analyzed and determined that Shuya is the variable interest entity (the “VIE”) of JHJ because 1) the equity investors at risk, as a group, lack the characteristics of a controlling financial interest, and 2) Shuya is structured with disproportionate voting rights, and substantially all the activities are conducted on behalf of an investor with disproportionately few voting rights. Under ASC 810, a reporting entity has a controlling financial interest in a VIE, and must consolidate that VIE, if the reporting entity has both of the following characteristics: (a) the power to direct the activities of the VIE that most significantly affect the VIE’s economic performance; and (b) the obligation to absorb losses, or the right to receive benefits, that could potentially be significant to the VIE. The Company concluded JHJ is deemed the primary beneficiary of the VIE. Accordingly, the Company consolidates Shuya into its consolidated financial statements effective on January 1, 2023.
Current wording
As a result of Consistent Action Agreement, the Company re-analyzed and determined that Shuya is the variable interest entity (“VIE”) of JHJ because 1) the equity investors at risk, as a group, lack the characteristics of a controlling financial interest, and 2) Shuya is structured with disproportionate voting rights, and substantially all of the activities are conducted on behalf of an investor with disproportionately few voting rights. Under ASC 810, a reporting entity has a controlling financial interest in a VIE, and must consolidate that VIE, if the reporting entity has both of the following characteristics: (a) the power to direct the activities of the VIE that most significantly affect the VIE’s economic performance; and (b) the obligation to absorb losses, or the right to receive benefits, that could potentially be significant to the VIE. The Company concluded JHJ is deemed the primary beneficiary of the VIE. Accordingly, the Company consolidates Shuya effective on January 1, 2023.