Kyocera Corporation (NYSE:KYO)(TOKYO:6971) today announced the construction of a new solar module manufacturing plant in Tianjin City, China in order to expand production capacity at KYOCERA (Tianjin) Solar Energy Co., Ltd. (herein Kyocera Tianjin Solar).
Construction of the new plant is timed to align the production capacity of solar modules with the increase in production of solar cells which Kyocera is set to expand to 650MW by March, 2012. Manufacturing modules mainly for the Asian market, the target production capacity of Kyocera Tianjin Solar will be bolstered to the eventual goal of 240MW from 2011, an increase to four times the current capacity of 60MW.
Construction of the new manufacturing plant will begin in April, with completion scheduled for spring of 2010. Upon completion of the new plant, all Kyocera Tianjin Solar manufacturing operations will subsequently be transferred to the new facility.
On February 18, the groundbreaking ceremony for the scheduled construction of the new plant was held on the site adjacent to the current facility.
Presently, the solar energy industry is garnering global attention. In 2003, anticipating future growth in the Asian market starting with China and Japan, Kyocera was the first Japanese company to establish a solar module manufacturing plant in China. With the Kyocera Group operating manufacturing facilities for solar modules in Japan, Mexico, the Czech Republic and the Tianjin facilities in China, Kyocera Tianjin Solar supplies solar modules to the leading Asian markets of Japan, South Korea and China as one of the group’s four global manufacturing centers.
Kyocera will continue to increase production capacity from here on to correspond with market demand, aiming for the further expansion of its solar energy business.
Details of the New KYOCERA (Tianjin) Solar Energy Co., Ltd. Plant
Start of Construction: April 2009 (scheduled)
Completion: Spring 2010 (scheduled)
Start of Operation: Gradual start of operations from spring 2010 (scheduled)
Building Area: 9,600m2
Floor Area: 28,800m2 (3 floors)
About KYOCERA
Kyocera Corporation (NYSE:KYO)(TOKYO:6971) (http://global.kyocera.com/), the parent and global headquarters of the Kyocera Group, was founded in 1959 as a producer of fine ceramics (also known as “advanced ceramics”). By combining these engineered materials with metals and plastics, and integrating them with other technologies, Kyocera has become a leading supplier of solar power generating systems, telecommunications equipment, laser printers, copiers, electronic components, semiconductor packages, cutting tools and industrial ceramics. During the year ended March 31, 2008, the company’s net sales totaled 1.29 trillion yen (approximately US$12.9 billion).
Thursday, February 26, 2009
Suntech Reports Fourth Quarter and Full Year 2008 Financial Results
SAN FRANCISCO and WUXI, China, Feb. 18 /PRNewswire-Asia/ -- Suntech Power Holdings Co., Ltd. (NYSE: STP), the world's largest photovoltaic (PV) module manufacturer, today announced financial results for the fourth quarter and full year ended December 31, 2008.
Fourth Quarter 2008 Financial Highlights(1)
-- Total net revenues grew 4.2% year-over-year to $414.4 million.
-- GAAP gross margin was 0.6% and non-GAAP(2) gross margin was 0.9%.
Excluding the provision for inventory and purchase commitments,
adjusted non-GAAP consolidated gross margin in the fourth quarter
was 13.1%.
-- GAAP net loss was $65.9 million, or negative $0.42 per diluted
American Depository Share (ADS). On a non-GAAP basis, Suntech's net
loss was $42.4 million, or negative $0.27 per diluted ADS. Each ADS
represents one ordinary share.
-- Net debt decreased by $273.7 million to $1,117.8 million as of
December 31, 2008.
Full Year 2008 Financial Highlights(1)
-- Total net revenues grew 42.7% year-over-year to $1,923.5 million.
-- Full year 2008 total shipments of solar products grew 36.0%
year-over-year to 497.5 MW.
-- GAAP gross margin was 17.8% and non-GAAP(2) gross margin was 18.2%.
-- GAAP net income for the full year was $111.0 million or $0.66 per
ADS. On a non-GAAP basis, Suntech's net income for the full year was
$149.7 million or $0.89 per diluted ADS.
-- Achieved 1GW solar cell and module production capacity.
"Customer recognition of Suntech's high performance and premium quality modules enabled us to deliver close to 500MW in the full year 2008 and extend our position as a world leader in solar," said Dr. Zhengrong Shi, Suntech's Chairman and CEO. "During 2008, we bolstered our on-the-ground customer service and support capability by opening branches in key markets and hiring experienced solar professionals, achieved 1GW production capacity, and demonstrated our strength in solar innovation with the successful commercialization of our Pluto technology."
"We believe that we are now in a position to service all avenues of solar demand globally, including residential roof-top, commercial roof-top, ground mounted and utility scale. In particular, our continued investment in the U.S. should position us for strong growth in that key market and its burgeoning utility-scale segment via our systems integration unit, Suntech Energy Solutions, and our project development joint venture, Gemini Solar."
"Despite the challenging market conditions, we are confident that we are well positioned to expand our market share in 2009. We believe that the project financing environment is improving and will continue to do so as the year progresses, leading to further growth of the solar industry. We are confident that Suntech's reputation as a global solar leader will benefit us as more and more customers realize the value in partnering with a company that offers stability, first class service, industry-leading scale, superior technology, quality and a broad product portfolio," added Dr. Shi.
RECENT BUSINESS HIGHLIGHTS
Silicon Procurement
-- Suntech and MEMC Electronic Materials amended their 10-year silicon
wafer supply agreement. As amended, the dollar value of silicon
wafer purchases from MEMC remains unchanged, but a volume increase
and a price reduction for 2009 have been effectuated.
-- Suntech acquired a minority stake in Asia Silicon Co. Ltd, an
independent polysilicon producer, for a total cash consideration of
approximately $8.1 million. Suntech previously entered into an
agreement to purchase up to $1.5 billion high purity polysilicon
from Asia Silicon over a seven-year period. Polysilicon cost
decreases to less than $40 per kilogram during the term of the
agreement.
Notable PV Projects
-- Suntech was chosen to design and construct a BIPV system totaling
3MW on the China and Theme Pavilions at the World Expo Shanghai 2010.
The project will be the largest BIPV installation in China.
-- Suntech supplied 5MW of Suntech solar panels for the largest solar
plant in the Middle East, a 10MW solar electricity system to power
Masdar City, the world's first carbon neutral city being built in
Abu Dhabi, United Arab Emirates. The solar system is being built and
designed by leading Abu Dhabi based solar power system integrator,
Enviromena Power Systems.
Product Offering Expansion
-- Suntech entered into an exclusive agreement giving Suntech rights
related to the worldwide manufacturing, distribution and marketing
of Applied Solar's building integrated solar roof tile product,
SolarBlend(TM), and roof membrane product, SolarEze(TM). The
agreements combine Suntech's industry-leading products with Applied
Solar's innovative BIPV applications to provide a more comprehensive
set of product offerings to the residential and commercial market.
U.S. Dealer Network
-- Suntech continued expanding its dealer network of residential
rooftop installers and integrators in the U.S. Currently, Suntech's
network includes over 100 dealers, up from 30 at the end of the
third quarter of 2008.
Technology
-- Suntech has a fully operational 34MW Pluto PV cell line and is in
the process of adding another 68MW of Pluto capacity. Suntech
expects to receive industry certification for Pluto PV modules in
the second quarter of 2009 and targets shipments of more than 50MW
of Pluto modules in 2009.
-- The Pluto high efficiency technology consistently achieves
conversion efficiencies of close to 17% on multi-crystalline PV
cells and close to 19% on mono-crystalline PV cells. Suntech
anticipates that the higher conversion efficiencies will improve
power output by up to 12% above conventional screen-printed PV cells,
enable improved space utilization and reduce installation and other
balance of system costs.
Convertible Senior Note Repurchase
-- Through December 31, 2008, Suntech repurchased $93.8 million
aggregate principal amount of its 0.25% Convertible Senior Notes due
2012 for cash consideration of $61.0 million. As a result, Suntech
realized a net gain of approximately $31.1 million.
Capital and Credit Facilities
-- Suntech had approximately $2.4 billion of approved credit lines to
be used for fixed asset purchase, working capital or trade financing
as of December 31, 2008. Of these credit facilities approximately
$1.2 billion had been drawn down as of December 31, 2008. Suntech
expects that its capital will be sufficient to cover its capital
expenditures in 2009 while maintaining adequate working capital to
support its operations.
Fourth Quarter 2008 Results
Net Non-GAAP Non-GAAP
Revenues Gross Profit Gross Margin
(in $ % of Net (in $
millions) Revenues millions) (%)
Standard PV Modules $382.6 92.3 % $11.4 3.0 %
Others $31.8 7.7 % ($7.8) (24.0%)
Total Net Revenues $414.4 100 % $3.6 0.9 %
Provision for
inventory and
purchase
commitment $50.7 12.2 %
Adjusted Non-GAAP
Gross Profit $54.3 13.1 %
Total net revenues for the fourth quarter of 2008 were $414.4 million, a decrease of 30.3% from $594.4 million in the third quarter of 2008. The sequential decrease in revenues was primarily due to a decrease in shipments and the average selling price of PV products.
Non-GAAP gross profit for the fourth quarter of 2008 was $3.6 million, compared to $129.7 million for the third quarter of 2008.
Fourth quarter of 2008 non-GAAP consolidated gross margin was 0.9%, compared to 21.8% in the third quarter of 2008. Gross margin decreased from the third quarter of 2008 primarily due to a sequential decrease in the average selling price of PV products and a provision for inventory and purchase commitments of $50.7 million in total, reflecting the rapid decrease in the silicon and module prices in the fourth quarter. The provision for inventory and purchase commitments had a 12.2% negative impact on margins. Excluding the provision for inventory and purchase commitments, adjusted non- GAAP consolidated gross margin in the fourth quarter was 13.1%, and adjusted non-GAAP net income margin was 2.0%.
Non-GAAP operating expenses in the fourth quarter of 2008 totaled $41.9 million or 10.1% of total net revenues, compared to $37.1 million or 6.2% of total net revenues in the third quarter of 2008. The increase was primarily due to an increase in provisions for doubtful debts and additional compensation expenses attributable to employees at Suntech Energy Solutions, which was acquired during the fourth quarter.
Non-GAAP loss from operations for the fourth quarter of 2008 was $38.2 million, compared to income from operations of $92.6 million in the third quarter of the 2008. Non-GAAP operating margin was negative 9.2% in the fourth quarter of 2008, compared to positive 15.6% in the third quarter of 2008.
Net interest expense was $8.0 million in the fourth quarter of 2008 compared to net interest expense of $7.9 million in the third quarter of 2008.
In January 2009, Suntech adopted Financial Accounting Standards Board Staff Position No. APB 14-1, Accounting for Convertible Debt Instruments that may be Settled in Cash Upon Conversion ("FSP APB 14-1"). The Company is currently assessing the impact of adopting FSP APB 14-1, which the Company believes will be material to its results of operations. FSP APB 14-1 requires that the liability and equity components of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) be separately accounted for in a manner that reflects an issuer's nonconvertible debt borrowing rate.
Foreign currency exchange loss was $3.2 million in the fourth quarter of 2008, compared to a loss of $16.6 million in the third quarter of 2008. The decrease was primarily due to a revaluation gain from the depreciation of net liabilities denominated in CNY in the fourth quarter of 2008. The exchange gain was largely offset by the revaluation loss resulting from the significant depreciation of net assets denominated in EUR.
Net other expenses increased to $19.7 million in the fourth quarter of 2008 from $3.2 million in the third quarter of 2008. The increase in net other expenses was primarily due to an investment impairment of $48.8 million for Suntech's investments in Hoku and Nitol, which was partially offset by a net gain of $31.1 million from the repurchase of the Convertible Senior Notes at a discount.
Non-GAAP net loss for the fourth quarter of 2008 was $42.4 million, or negative $0.27 per diluted ADS, compared to non-GAAP net income of $60.3 million, or $0.35 per diluted ADS in the third quarter of 2008.
On a GAAP basis, for the fourth quarter of 2008 gross profit was $2.3 million. Consolidated gross margin was 0.6% for the fourth quarter of 2008.
On a GAAP basis, operating expenses for the fourth quarter of 2008 were $46.2 million or 11.1% of total net revenues. Loss from operations was $43.8 million for the fourth quarter of 2008. Net loss for the fourth quarter of 2008 was $65.9 million, or negative $0.42 per diluted ADS.
In the fourth quarter of 2008, capital expenditures, which were primarily related to expanding production capacity and constructing Suntech's production facilities, totaled $109.1 million. Depreciation and amortization expenses totaled $11.6 million.
Cash and cash equivalents increased to $507.8 million as of December 31, 2008 from $394.6 million as of September 20, 2008. The increase was mainly due to the accelerated collection of VAT recoverable and the liquidation of short- term investments. The increase was partially offset by the cash payments for the repurchase of the Convertible Senior Notes and repayment of bank borrowings. As a result of the foregoing, the net debt balance decreased from $1,391.5 million as of September 30, 2008 to $1,117.8 million as of December 31, 2008.
Restricted cash was $70.7 million as of December 31, 2008.
Inventory totaled $231.9 million as of December 31, 2008 compared to $247.9 million as of September 30, 2008. The decrease was primarily caused by the inventory provision.
Value-added tax recoverable totaled $75.7 million as of December 31, 2008, compared to $201.8 million as of September 30, 2008. The decrease was mainly due to the accelerated collection of some value-added tax recoverable in the fourth quarter of 2008.
Full Year 2008 Results
Net Non-GAAP Non-GAAP
Revenues Gross Profit Gross Margin
(in $ % of Net (in $
millions) Revenues millions) (%)
Standard $1,785.8 92.8 % $343.8 19.3 %
PV
Modules
Others $137.7 7.2 % $5.7 4.1 %
Total Net $1,923.5 100 % $349.5 18.2 %
Revenues
Total net revenues for the full year 2008 were $1,923.5 million, representing a 42.7% increase from 2007.
On a non-GAAP basis, the full year 2008 gross profit was $349.5 million, an increase of 22.7% year-over-year. 2008 consolidated gross margin was 18.2% compared to 21.1% in 2007. Income from operations was $205.7 million compared to $215.1 million in 2007. Net income was $149.7 million or $0.89 per diluted ADS, compared to non-GAAP net income of $201.0 million or $1.19 per diluted ADS in the full year 2007.
On a GAAP basis, for the full year 2008 gross profit was $342.9 million, an increase of 25.1% year-over-year. 2008 gross margin was 17.8% compared to 20.3% in 2007. Income from operations was $182.5 million, a decrease of 0.8% year-over-year. Net income was $111.0 million, a decrease of 35.2% year-over- year, or $0.66 per diluted ADS, compared to net income of $171.3 million or $1.02 per diluted ADS in the full year 2007.
In the full year 2008, capital expenditures, which were primarily related to expanding production capacity and constructing Suntech's production facilities, totaled $347.9 million. Depreciation and amortization expenses totaled $39.3 million.
Business Outlook
Based on current operating conditions, Suntech expects revenues for the first quarter of 2009 to be in the range of $340 million to $380 million, assuming an exchange rate of $1.28 U.S. dollars to the Euro in the first quarter 2009. GAAP consolidated gross margin in the first quarter of 2009 is expected to be in the range of 12% to 15%.
Suntech expects full-year 2009 shipments of more than 800MW. Suntech intends to hold PV cell production capacity at 1GW in 2009 until credit market visibility improves. Suntech expects capital expenditures of approximately $100 million in 2009. The majority of 2009 capital expenditures will be utilized to retrofit existing production capacity to the high efficiency Pluto technology and the completion of the thin film facility.
Fourth Quarter 2008 Financial Highlights(1)
-- Total net revenues grew 4.2% year-over-year to $414.4 million.
-- GAAP gross margin was 0.6% and non-GAAP(2) gross margin was 0.9%.
Excluding the provision for inventory and purchase commitments,
adjusted non-GAAP consolidated gross margin in the fourth quarter
was 13.1%.
-- GAAP net loss was $65.9 million, or negative $0.42 per diluted
American Depository Share (ADS). On a non-GAAP basis, Suntech's net
loss was $42.4 million, or negative $0.27 per diluted ADS. Each ADS
represents one ordinary share.
-- Net debt decreased by $273.7 million to $1,117.8 million as of
December 31, 2008.
Full Year 2008 Financial Highlights(1)
-- Total net revenues grew 42.7% year-over-year to $1,923.5 million.
-- Full year 2008 total shipments of solar products grew 36.0%
year-over-year to 497.5 MW.
-- GAAP gross margin was 17.8% and non-GAAP(2) gross margin was 18.2%.
-- GAAP net income for the full year was $111.0 million or $0.66 per
ADS. On a non-GAAP basis, Suntech's net income for the full year was
$149.7 million or $0.89 per diluted ADS.
-- Achieved 1GW solar cell and module production capacity.
"Customer recognition of Suntech's high performance and premium quality modules enabled us to deliver close to 500MW in the full year 2008 and extend our position as a world leader in solar," said Dr. Zhengrong Shi, Suntech's Chairman and CEO. "During 2008, we bolstered our on-the-ground customer service and support capability by opening branches in key markets and hiring experienced solar professionals, achieved 1GW production capacity, and demonstrated our strength in solar innovation with the successful commercialization of our Pluto technology."
"We believe that we are now in a position to service all avenues of solar demand globally, including residential roof-top, commercial roof-top, ground mounted and utility scale. In particular, our continued investment in the U.S. should position us for strong growth in that key market and its burgeoning utility-scale segment via our systems integration unit, Suntech Energy Solutions, and our project development joint venture, Gemini Solar."
"Despite the challenging market conditions, we are confident that we are well positioned to expand our market share in 2009. We believe that the project financing environment is improving and will continue to do so as the year progresses, leading to further growth of the solar industry. We are confident that Suntech's reputation as a global solar leader will benefit us as more and more customers realize the value in partnering with a company that offers stability, first class service, industry-leading scale, superior technology, quality and a broad product portfolio," added Dr. Shi.
RECENT BUSINESS HIGHLIGHTS
Silicon Procurement
-- Suntech and MEMC Electronic Materials amended their 10-year silicon
wafer supply agreement. As amended, the dollar value of silicon
wafer purchases from MEMC remains unchanged, but a volume increase
and a price reduction for 2009 have been effectuated.
-- Suntech acquired a minority stake in Asia Silicon Co. Ltd, an
independent polysilicon producer, for a total cash consideration of
approximately $8.1 million. Suntech previously entered into an
agreement to purchase up to $1.5 billion high purity polysilicon
from Asia Silicon over a seven-year period. Polysilicon cost
decreases to less than $40 per kilogram during the term of the
agreement.
Notable PV Projects
-- Suntech was chosen to design and construct a BIPV system totaling
3MW on the China and Theme Pavilions at the World Expo Shanghai 2010.
The project will be the largest BIPV installation in China.
-- Suntech supplied 5MW of Suntech solar panels for the largest solar
plant in the Middle East, a 10MW solar electricity system to power
Masdar City, the world's first carbon neutral city being built in
Abu Dhabi, United Arab Emirates. The solar system is being built and
designed by leading Abu Dhabi based solar power system integrator,
Enviromena Power Systems.
Product Offering Expansion
-- Suntech entered into an exclusive agreement giving Suntech rights
related to the worldwide manufacturing, distribution and marketing
of Applied Solar's building integrated solar roof tile product,
SolarBlend(TM), and roof membrane product, SolarEze(TM). The
agreements combine Suntech's industry-leading products with Applied
Solar's innovative BIPV applications to provide a more comprehensive
set of product offerings to the residential and commercial market.
U.S. Dealer Network
-- Suntech continued expanding its dealer network of residential
rooftop installers and integrators in the U.S. Currently, Suntech's
network includes over 100 dealers, up from 30 at the end of the
third quarter of 2008.
Technology
-- Suntech has a fully operational 34MW Pluto PV cell line and is in
the process of adding another 68MW of Pluto capacity. Suntech
expects to receive industry certification for Pluto PV modules in
the second quarter of 2009 and targets shipments of more than 50MW
of Pluto modules in 2009.
-- The Pluto high efficiency technology consistently achieves
conversion efficiencies of close to 17% on multi-crystalline PV
cells and close to 19% on mono-crystalline PV cells. Suntech
anticipates that the higher conversion efficiencies will improve
power output by up to 12% above conventional screen-printed PV cells,
enable improved space utilization and reduce installation and other
balance of system costs.
Convertible Senior Note Repurchase
-- Through December 31, 2008, Suntech repurchased $93.8 million
aggregate principal amount of its 0.25% Convertible Senior Notes due
2012 for cash consideration of $61.0 million. As a result, Suntech
realized a net gain of approximately $31.1 million.
Capital and Credit Facilities
-- Suntech had approximately $2.4 billion of approved credit lines to
be used for fixed asset purchase, working capital or trade financing
as of December 31, 2008. Of these credit facilities approximately
$1.2 billion had been drawn down as of December 31, 2008. Suntech
expects that its capital will be sufficient to cover its capital
expenditures in 2009 while maintaining adequate working capital to
support its operations.
Fourth Quarter 2008 Results
Net Non-GAAP Non-GAAP
Revenues Gross Profit Gross Margin
(in $ % of Net (in $
millions) Revenues millions) (%)
Standard PV Modules $382.6 92.3 % $11.4 3.0 %
Others $31.8 7.7 % ($7.8) (24.0%)
Total Net Revenues $414.4 100 % $3.6 0.9 %
Provision for
inventory and
purchase
commitment $50.7 12.2 %
Adjusted Non-GAAP
Gross Profit $54.3 13.1 %
Total net revenues for the fourth quarter of 2008 were $414.4 million, a decrease of 30.3% from $594.4 million in the third quarter of 2008. The sequential decrease in revenues was primarily due to a decrease in shipments and the average selling price of PV products.
Non-GAAP gross profit for the fourth quarter of 2008 was $3.6 million, compared to $129.7 million for the third quarter of 2008.
Fourth quarter of 2008 non-GAAP consolidated gross margin was 0.9%, compared to 21.8% in the third quarter of 2008. Gross margin decreased from the third quarter of 2008 primarily due to a sequential decrease in the average selling price of PV products and a provision for inventory and purchase commitments of $50.7 million in total, reflecting the rapid decrease in the silicon and module prices in the fourth quarter. The provision for inventory and purchase commitments had a 12.2% negative impact on margins. Excluding the provision for inventory and purchase commitments, adjusted non- GAAP consolidated gross margin in the fourth quarter was 13.1%, and adjusted non-GAAP net income margin was 2.0%.
Non-GAAP operating expenses in the fourth quarter of 2008 totaled $41.9 million or 10.1% of total net revenues, compared to $37.1 million or 6.2% of total net revenues in the third quarter of 2008. The increase was primarily due to an increase in provisions for doubtful debts and additional compensation expenses attributable to employees at Suntech Energy Solutions, which was acquired during the fourth quarter.
Non-GAAP loss from operations for the fourth quarter of 2008 was $38.2 million, compared to income from operations of $92.6 million in the third quarter of the 2008. Non-GAAP operating margin was negative 9.2% in the fourth quarter of 2008, compared to positive 15.6% in the third quarter of 2008.
Net interest expense was $8.0 million in the fourth quarter of 2008 compared to net interest expense of $7.9 million in the third quarter of 2008.
In January 2009, Suntech adopted Financial Accounting Standards Board Staff Position No. APB 14-1, Accounting for Convertible Debt Instruments that may be Settled in Cash Upon Conversion ("FSP APB 14-1"). The Company is currently assessing the impact of adopting FSP APB 14-1, which the Company believes will be material to its results of operations. FSP APB 14-1 requires that the liability and equity components of convertible debt instruments that may be settled in cash upon conversion (including partial cash settlement) be separately accounted for in a manner that reflects an issuer's nonconvertible debt borrowing rate.
Foreign currency exchange loss was $3.2 million in the fourth quarter of 2008, compared to a loss of $16.6 million in the third quarter of 2008. The decrease was primarily due to a revaluation gain from the depreciation of net liabilities denominated in CNY in the fourth quarter of 2008. The exchange gain was largely offset by the revaluation loss resulting from the significant depreciation of net assets denominated in EUR.
Net other expenses increased to $19.7 million in the fourth quarter of 2008 from $3.2 million in the third quarter of 2008. The increase in net other expenses was primarily due to an investment impairment of $48.8 million for Suntech's investments in Hoku and Nitol, which was partially offset by a net gain of $31.1 million from the repurchase of the Convertible Senior Notes at a discount.
Non-GAAP net loss for the fourth quarter of 2008 was $42.4 million, or negative $0.27 per diluted ADS, compared to non-GAAP net income of $60.3 million, or $0.35 per diluted ADS in the third quarter of 2008.
On a GAAP basis, for the fourth quarter of 2008 gross profit was $2.3 million. Consolidated gross margin was 0.6% for the fourth quarter of 2008.
On a GAAP basis, operating expenses for the fourth quarter of 2008 were $46.2 million or 11.1% of total net revenues. Loss from operations was $43.8 million for the fourth quarter of 2008. Net loss for the fourth quarter of 2008 was $65.9 million, or negative $0.42 per diluted ADS.
In the fourth quarter of 2008, capital expenditures, which were primarily related to expanding production capacity and constructing Suntech's production facilities, totaled $109.1 million. Depreciation and amortization expenses totaled $11.6 million.
Cash and cash equivalents increased to $507.8 million as of December 31, 2008 from $394.6 million as of September 20, 2008. The increase was mainly due to the accelerated collection of VAT recoverable and the liquidation of short- term investments. The increase was partially offset by the cash payments for the repurchase of the Convertible Senior Notes and repayment of bank borrowings. As a result of the foregoing, the net debt balance decreased from $1,391.5 million as of September 30, 2008 to $1,117.8 million as of December 31, 2008.
Restricted cash was $70.7 million as of December 31, 2008.
Inventory totaled $231.9 million as of December 31, 2008 compared to $247.9 million as of September 30, 2008. The decrease was primarily caused by the inventory provision.
Value-added tax recoverable totaled $75.7 million as of December 31, 2008, compared to $201.8 million as of September 30, 2008. The decrease was mainly due to the accelerated collection of some value-added tax recoverable in the fourth quarter of 2008.
Full Year 2008 Results
Net Non-GAAP Non-GAAP
Revenues Gross Profit Gross Margin
(in $ % of Net (in $
millions) Revenues millions) (%)
Standard $1,785.8 92.8 % $343.8 19.3 %
PV
Modules
Others $137.7 7.2 % $5.7 4.1 %
Total Net $1,923.5 100 % $349.5 18.2 %
Revenues
Total net revenues for the full year 2008 were $1,923.5 million, representing a 42.7% increase from 2007.
On a non-GAAP basis, the full year 2008 gross profit was $349.5 million, an increase of 22.7% year-over-year. 2008 consolidated gross margin was 18.2% compared to 21.1% in 2007. Income from operations was $205.7 million compared to $215.1 million in 2007. Net income was $149.7 million or $0.89 per diluted ADS, compared to non-GAAP net income of $201.0 million or $1.19 per diluted ADS in the full year 2007.
On a GAAP basis, for the full year 2008 gross profit was $342.9 million, an increase of 25.1% year-over-year. 2008 gross margin was 17.8% compared to 20.3% in 2007. Income from operations was $182.5 million, a decrease of 0.8% year-over-year. Net income was $111.0 million, a decrease of 35.2% year-over- year, or $0.66 per diluted ADS, compared to net income of $171.3 million or $1.02 per diluted ADS in the full year 2007.
In the full year 2008, capital expenditures, which were primarily related to expanding production capacity and constructing Suntech's production facilities, totaled $347.9 million. Depreciation and amortization expenses totaled $39.3 million.
Business Outlook
Based on current operating conditions, Suntech expects revenues for the first quarter of 2009 to be in the range of $340 million to $380 million, assuming an exchange rate of $1.28 U.S. dollars to the Euro in the first quarter 2009. GAAP consolidated gross margin in the first quarter of 2009 is expected to be in the range of 12% to 15%.
Suntech expects full-year 2009 shipments of more than 800MW. Suntech intends to hold PV cell production capacity at 1GW in 2009 until credit market visibility improves. Suntech expects capital expenditures of approximately $100 million in 2009. The majority of 2009 capital expenditures will be utilized to retrofit existing production capacity to the high efficiency Pluto technology and the completion of the thin film facility.
Canadian Solar cuts 2009 shipment outlook
Feb 17 (Reuters) - China's Canadian Solar Inc (CSIQ.O) cut its 2009 shipment outlook, citing uncertainty in financial markets, and does not expect revenue to cover input costs in the fourth quarter of 2008.
"Gross margin in the fourth quarter is expected to be negative, reflecting the weak euro, a decline in module pricing in December and an inventory revaluation provision," Canadian Solar said.
The solar-cell maker forecast 2009 shipments of 300 to 350 megawatts (MW), down from its prior outlook of 500 to 550 MW.
The company said that near-term solar demand and pricing were being hit by the current credit environment, winter weather in Germany and market-wide inventory clearance efforts.
For the fourth quarter of 2008, the company forecast revenue of $66 million to $71 million, compared with analysts' average estimate of $69.3 million. (Reporting by Arup Roychoudhury in Bangalore; Editing by Pratish Narayanan)
"Gross margin in the fourth quarter is expected to be negative, reflecting the weak euro, a decline in module pricing in December and an inventory revaluation provision," Canadian Solar said.
The solar-cell maker forecast 2009 shipments of 300 to 350 megawatts (MW), down from its prior outlook of 500 to 550 MW.
The company said that near-term solar demand and pricing were being hit by the current credit environment, winter weather in Germany and market-wide inventory clearance efforts.
For the fourth quarter of 2008, the company forecast revenue of $66 million to $71 million, compared with analysts' average estimate of $69.3 million. (Reporting by Arup Roychoudhury in Bangalore; Editing by Pratish Narayanan)
Trina Solar Announces Selected Estimated Fourth Quarter and Full Year 2008 Financial Results
CHANGZHOU, China, Feb. 17 /PRNewswire-Asia-FirstCall/ -- Trina Solar Limited (NYSE: TSL) ("Trina Solar" or the "Company"), a leading integrated manufacturer of solar photovoltaic products from the production of ingots, wafers and cells to the assembly of PV modules, today announced the following selected estimated financial results for the quarter and the full year ended December 31, 2008.
For the fourth quarter 2008, the Company expects:
-- total net revenues for the fourth quarter to exceed its previous
guidance range of $190 million to $210 million
-- fourth quarter positive net operating cashflow to be approximately $60
million
-- short-term debt to be reduced by approximately $41 million to $249
million
-- a non-cash inventory provision between $16 million and $18 million
For the full year 2008, the Company expects:
-- total net revenues for the full year 2008 to meet its previous guidance
range of $800 million to $850 million
-- total module shipments for the full year 2008 to meet its previous
guidance range of 200 MW to 206 MW
"Against a very challenging operating environment, where preservation of cash and balance sheet fundamentals were our priorities, the notable reduction in both our silicon and non-silicon manufacturing costs resulted in our highest ever quarterly operating cashflow," said Mr. Jifan Gao, Chairman and CEO of Trina Solar. "This allowed us to significantly reduce our short-term debt to further improve our capital structure and maintain our liquidity for 2009."
The Company also announced that it anticipates a non-cash inventory provision between $16 million and $18 million mainly due to the revaluation of its silicon inventory linked to notable market price declines in the fourth quarter of 2008. The provision is expected to have a negative gross margin impact of 7% to 8%. With this provision, the Company expects its fourth quarter gross margin to be in the range of 9% to 10%, compared to its earlier previous guidance of 13% to 15%. The Company also expects its operating and net margins would be correspondingly affected.
As these selected estimated results are subject to finalization of the Company's financial closing procedures, the Company's actual results may differ from its current estimates.
The Company will review its fourth quarter and full year 2008 results via conference call on March 3, 2009 at 8:00 am (EST). Conference call details may be found via separate announcement, available at the company's website at http://www.trinasolar.com.
For the fourth quarter 2008, the Company expects:
-- total net revenues for the fourth quarter to exceed its previous
guidance range of $190 million to $210 million
-- fourth quarter positive net operating cashflow to be approximately $60
million
-- short-term debt to be reduced by approximately $41 million to $249
million
-- a non-cash inventory provision between $16 million and $18 million
For the full year 2008, the Company expects:
-- total net revenues for the full year 2008 to meet its previous guidance
range of $800 million to $850 million
-- total module shipments for the full year 2008 to meet its previous
guidance range of 200 MW to 206 MW
"Against a very challenging operating environment, where preservation of cash and balance sheet fundamentals were our priorities, the notable reduction in both our silicon and non-silicon manufacturing costs resulted in our highest ever quarterly operating cashflow," said Mr. Jifan Gao, Chairman and CEO of Trina Solar. "This allowed us to significantly reduce our short-term debt to further improve our capital structure and maintain our liquidity for 2009."
The Company also announced that it anticipates a non-cash inventory provision between $16 million and $18 million mainly due to the revaluation of its silicon inventory linked to notable market price declines in the fourth quarter of 2008. The provision is expected to have a negative gross margin impact of 7% to 8%. With this provision, the Company expects its fourth quarter gross margin to be in the range of 9% to 10%, compared to its earlier previous guidance of 13% to 15%. The Company also expects its operating and net margins would be correspondingly affected.
As these selected estimated results are subject to finalization of the Company's financial closing procedures, the Company's actual results may differ from its current estimates.
The Company will review its fourth quarter and full year 2008 results via conference call on March 3, 2009 at 8:00 am (EST). Conference call details may be found via separate announcement, available at the company's website at http://www.trinasolar.com.
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