LDK Solar Reports Financial Results for Third Quarter 2008

XINYU CITY, China and SUNNYVALE, Calif., Nov 19, 2008 /PRNewswire-FirstCall via COMTEX/ -- LDK Solar Co., Ltd., a leading manufacturer of multicrystalline solar wafers, today reported its unaudited financial results for the third quarter ended September 30, 2008. All financial results are reported in U.S. dollars on a U.S. GAAP basis.

Third Quarter 2008 Financial Highlights:
-- Revenue of $541.8 million, up 22.7% quarter-over-quarter;
-- Annualized wafer production capacity reached 1.2 GW by end the quarter;
-- Signed 14 long-term wafer supply agreements year-to-date;
-- Total wafer shipments increased 31.8% to 252.7 MW during the quarter;
-- Gross profit margin for the quarter was 22.7%; and
-- Completed a follow-on offering of 4.8 million American depositary shares ("ADSs"), further enhancing LDK Solar's resources for accelerated expansion plans.

Net sales for the third quarter of fiscal 2008 were $541.8 million, up 22.7% from $441.7 million for the second quarter of fiscal 2008, and up 241.4% from $158.7 million for the third quarter of fiscal 2007.

Gross profit for the third quarter of fiscal 2008 was $122.9 million, up 9.5% from $112.3 million for the second quarter of fiscal 2008, and up 151.3% from $48.9 million for the third quarter of fiscal 2007. Gross profit margin for the third quarter of fiscal 2008 was 22.7% compared to 25.4% in the second quarter of fiscal 2008 and 30.8% in the third quarter of fiscal 2007.

Operating profit for the third quarter of fiscal 2008 was $107.8 million, up 7.5% from $100.3 million for the second quarter of fiscal 2008, and up 149.6% from $43.2 million for the third quarter of fiscal 2007. Operating profit margin for the third quarter of fiscal 2008 was 19.9% compared to 22.7% in the second quarter of fiscal 2008 and 27.2% in the third quarter of fiscal 2007.

Income tax expense for the third quarter of fiscal 2008 was $13.8 million, compared to income tax expense of $13.3 million in the second quarter of fiscal 2008.

Net income for the third quarter of fiscal 2008 was $88.4 million, or $0.77 per diluted ADS, compared to net income of $149.5 million, or $1.29 per diluted ADS for the second quarter of fiscal 2008.

LDK Solar ended the third quarter of fiscal 2008 with $347.8 million in cash and cash equivalents and $115.0 million in short-term pledged bank deposits.

On September 24, 2008, LDK Solar closed a follow-on offering of 4,800,000 ADSs, resulting in net proceeds of $192.4 million from the offering. As disclosed in the prospectus, LDK Solar expects to use approximately 60% of the net proceeds to fund the construction of its polysilicon manufacturing plant, approximately 30% to fund the capacity expansion of its wafer production facilities and the remaining 10% to fund other general corporate activities.

"We are pleased to deliver strong third quarter financial results as we continue to experience robust demand and significant growth of our business," stated Xiaofeng Peng, Chairman and CEO of LDK Solar. "Total revenue this quarter was at the high end of our previously released guidance. During the quarter, we also successfully completed a secondary share offering which resulted in net proceeds of approximately $192.4 million. As a result, we believe that we are well positioned with sufficient resources to fund our current growth plans through 2009. Our market leadership position is strengthened by our accelerated execution of our wafer capacity expansion, strong wafer supply contract backlog, and our geographically diverse customer base."
"The plant commissioning process for the 1,000 MT polysilicon plant has progressed and all stations are now fully operational. Based upon the current status of the commissioning and testing phase, we expect polysilicon output in early December 2008 and estimate 2008 production to be between 15 MT and 25 MT. We anticipate a smaller than previously expected polysilicon output in 2008 as we have committed more time to industry safety and environmental protection measures. We have made considerable progress on our construction schedule for both plants and remain confident in the timeline for the construction of our 15,000 MT polysilicon plant, where we currently expect the first 5,000 MT train to be operational at the end of first quarter or the beginning of the second quarter 2009. We remain confident that we will produce between 5,000 and 7,000 MT of polysilicon in 2009," continued Mr. Peng.

"As we look ahead, our business will not be immune to the current global economic downturn. However, given the strength of our business model, conservative financial management, and our strong cash position, we remain confident in our long-term growth opportunities, and in our ability to succeed and to continue our role in driving the solar industry forward," concluded Mr. Peng.

Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking in nature, and the actual results may differ materially. You should read the "Safe Harbor Statement" below with respect to the risks and uncertainties relating to these forward-looking statements.

For the fourth quarter of fiscal 2008, LDK Solar estimates its revenue to be in the range of $555 million to $565 million with wafer shipments between 260 MW to 270 MW and gross margin between 18% and 21%. By the end of fiscal 2008, LDK Solar currently expects to:
-- Reach an annualized wafer production capacity of 1.4 GW; and
-- Produce 15 to 25 MT of polysilicon.

For the full year of fiscal 2009, LDK Solar currently estimates:
-- Revenue to be in the range of $2.9 billion to $3.1 billion;
-- Wafer shipments in the range of 1.80 GW to 1.85 GW;
-- Annualized wafer production capacity to be 2.3 GW by the end of 2009;
-- Gross margin between 26% and 31%; and
-- Production of between 5,000 and 7,000 MT of polysilicon in 2009.