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Category: Investment, Solar, China Market
Solar Stocks News - LDK Solar Reports Financial Results for Third Quarter 2009
XINYU CITY, China and SUNNYVALE, Calif. - November 23, 2009 - LDK Solar Co., Ltd. ( NYSE: LDK), a leading manufacturer of multicrystalline solar wafers, today reported its unaudited financial results for the third quarter ended September 30, 2009.
All financial results are reported in U.S. dollars on a U.S. GAAP basis.
Recent Highlights:
- Third quarter 2009 revenue was $281.9 million;
- Shipped 320.5 MW of wafers, up 26.8% year-over-year;
- Gross margin for the third quarter of fiscal 2009 was 20.1%;
- Net income was $29.4 million, or $0.27 per diluted ADS;
- Increased wafer capacity to 1.7 GW and started pilot production at first 5,000 metric ton (MT) train in 15,000 MT polysilicon plant; and
- Sold a 15% ownership stake in 15,000 MT annualized capacity polysilicon plant to Jiangxi International Trust and Investment Co., Ltd. for RMB1.5 billion (equivalent to approximately US$219 million)
Net sales for the third quarter of fiscal 2009 were $281.9 million, compared to $228.3 million for the second quarter of fiscal 2009, and $541.8 million for the third quarter of fiscal 2008.
For the third quarter of fiscal 2009, gross profit was $56.8 million, compared to negative $205.5 million in the second quarter of fiscal 2009, and $122.9 million for the third quarter of fiscal 2008.
Gross margin for the third quarter of fiscal 2009 was 20.1%, compared to negative 90.0% in the second quarter of fiscal 2009 and 22.7% in the third quarter of fiscal 2008.
Income from operations for the third quarter of fiscal 2009 was $37.1 million, compared to a loss of $235.0 million for the second quarter of 2009, and compared to income from operations of $107.8 million for the third quarter of fiscal 2008.
Operating margin for the third quarter of fiscal 2009 was 13.2% compared to negative 102.9% in the second quarter of fiscal 2009 and 19.9% in the third quarter of fiscal 2008.
Income tax expense for the third quarter of fiscal 2009 was $6.6 million, compared to income tax benefit of $29.5 million in the second quarter of fiscal 2009.
Net income for the third quarter of fiscal 2009 was $29.4 million, or $0.27 per diluted ADS, compared to a net loss of $216.9 million, or $2.03 per diluted ADS for the second quarter of fiscal 2009.
LDK Solar ended the third quarter of 2009 with $67.8 million in cash and cash equivalents and $72.7 million in short-term pledged bank deposits.
"We were pleased to see wafer demand strengthen across multiple geographies during the quarter, rebounding from the lower levels seen earlier this year. Our financial results for the third quarter reflect the recent improvement in the operating environment for the solar industry," stated Xiaofeng Peng, Chairman and CEO of LDK Solar. "During the third quarter, we continued to take steps to further strengthen our business. In addition to reaching important milestones for ramping our polysilicon production, we made great strides to further diversify and grow our business and improve our operating flexibility by increasing our near-term financial resources, while we continued to closely manage costs.
"We are making significant progress in ramping our operations. Our 1,000 MT polysilicon plant is in full scale production and our wafer plant is running at full capacity. We completed the first production run and initiated production ramp-up of operations for the first 5,000 MT train of our 15,000 MT plant during the quarter. As part of our efforts to expand our financial resources, we recently completed the sale of a 15% ownership stake in 15,000 MT plant for approximately $219 million to Jiangxi International Trust and Investment Co., Ltd. This investment strengthens our financial position and increases our operating flexibility," continued Mr. Peng.
"During the third quarter, we made significant progress in diversifying our business. In China, the momentum in the local solar industry has continued to be encouraging. We have been awarded initial contracts to develop PV power projects in buildings, plants and integration systems, totaling up to 2 GW in various provinces. We will also co-operate with Best Solar on downstream PV projects, such as solar cell or module manufacturing, solar panel assembly or provision of certain solar utility services. As part of our ongoing efforts to expand our presence globally, we announced a partnership with Enfinity and the Balta Group for the largest rooftop solar energy installation project in Benelux, which will represent our first volume shipments of modules to Europe. We continue to be excited by the long-term growth opportunities in the solar industry," 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 2009, LDK Solar estimates its revenue to be in the range of $280 million to $310 million with wafer shipments between 320 MW to 340 MW and module shipments between 20 MW to 30 MW.
Conference Call Details
The LDK Solar Third Quarter 2009 teleconference and webcast is scheduled to begin at 8:00 a.m. Eastern Time (ET), on November 23, 2009. To listen to the live conference call, please dial 877-941-4774 877-941-4774 (within U.S.) or 480-629-9760 480-629-9760 (outside U.S.) at 7:50 a.m. ET on November 23, 2009. An audio replay of the call will be available to investors through November 25, 2009, by dialing 800-406-7325 800-406-7325 (within U.S.) or 303-590-3030 303-590-3030 (outside U.S.) and entering the passcode 4178461#.
LDK Solar Co., Ltd.
Unaudited Condensed Consolidated Balance Information
(In US$'000, except share and per share data)
| |
| | 9/30/2009 | 6/30/2009 |
| | --------- | --------- |
| Assets |
| Current assets |
| Cash and cash equivalents | 67,753 | 265,662 |
| Pledged bank deposits | 72,665 | 122,999 |
| Trade accounts receivable | 247,212 | 242,138 |
| Bills receivable | 5,208 | 642 |
| Inventories | 392,409 | 384,126 |
| Prepayments to suppliers, net | 74,063 | 79,163 |
| Due from related parties | 15,309 | - |
| Other current assets | 154,098 | 114,449 |
| Deferred income tax assets, net | 69,909 | 79,360 |
| | ------ | ------ |
| Total current assets | 1,098,626 | 1,288,539 |
| Property, plant and equipment, net | 2,480,554 | 2,255,388 |
Deposits for purchases of
property, plant and equipment | 56,742 | 109,896 |
| Intangible asset, net | 1,035 | 966 |
| Land use rights | 164,422 | 164,846 |
Inventories to be processed
beyond one year | 25,314 | - |
Prepayments to suppliers expected
to be utilized beyond one year, net | 30,624 | 31,666 |
Pledged bank deposits -
non-current | 50,382 | 49,947 |
| Debt issuance costs, net | 5,813 | 6,690 |
Investment in an associate and
a joint venture | 74,540 | 63,504 |
Deposits relating to sales
and leaseback transactions | 7,322 | 7,319 |
| Deferred income tax assets | 16,907 | - |
| Other assets | 494 | - |
| | --- | --- |
| Total assets | 4,012,775 | 3,978,761 |
Liabilities and equity
Current liabilities Short-term bank borrowings and current installments of long-term bank borrowings
| |
| | 1,103,754 | 1,189,902 |
| Bills payable | 103,065 | 162,509 |
| Trade accounts payable | 154,438 | 128,266 |
Advance payments from
customers, current portion | 488,677 | 258,438 |
| Accrued expenses and other payables | 537,006 | 548,870 |
| Due to related parties | 32,628 | 647 |
| Income tax payable | 12,409 | 914 |
| Other financial liabilities | 20,586 | 19,252 |
| | ------ | ------ |
| Total current liabilities | 2,452,563 | 2,308,798 |
| Convertible senior notes | 400,000 | 400,000 |
| Debt discount | (9,898) | (11,391) |
Long-term bank borrowings,
excluding current installments | 298,918 | 247,406 |
Obligations under capital leases,
excluding current installments | 25,576 | 30,472 |
Advance payments from
customers - non- current | 177,967 | 423,491 |
| Other liabilities | 64,821 | 15,333 |
| Deferred income tax liability | 7,170 | 4,556 |
| | ----- | ----- |
| Total liabilities | 3,417,117 | 3,418,665 |
| | --------- | --------- |
Equity
LDK Solar Co., Ltd. shareholders' equity
Ordinary shares: US$0.10 par value; 499,580,000 shares authorized; 113,501,049 shares issued; 113,248,243 and 113,212,122 shares outstanding as of September 30, 2009 and June 30, 2009, respectively
| | 11,325 | 11,321 |
| Additional paid-in capital | 476,653 | 473,268 |
| Statutory reserve | 29,676 | 29,676 |
| Accumulated other comprehensive income | 86,620 | 83,736 |
| Accumulated deficit | (8,478) | (37,919) |
| | ------ ------- |
Total LDK Solar Co., Ltd.
shareholders' equity | 595,796 | 560,082 |
| Non-controlling interests | (138) | 14 |
| | ---- | --- |
| Total equity | 595,658 | 560,096 |
| | ------- | ------- |
| Total liabilities and shareholders' equity | 4,012,775 | 3,978,761 |
LDK Solar Co., Ltd. Unaudited Condensed Consolidated Statements of Operations Information (In US$'000, except per ADS data)
| For the 3 Months Ended |
| | 9/30/2009 | 6/30/2009 |
| Net sales | 281,888 | 228,298 |
| Cost of goods sold | (225,118) | (433,819) |
| | -------- | -------- |
| Gross profit (loss) | 56,770 | (205,521) |
| Selling expenses | (1,549) | (954) |
| General and administrative expenses | (16,110) | (26,506) |
| Research and development expenses | (2,007) | (2,018) |
| | ------ | ------ |
| Total operating expenses | (19,666) | (29,478) |
| | ------- | ------- |
| Profit (loss) from operations | 37,104 | (234,999) |
| Other income (expenses): |
| Interest income | 696 | 394 |
Interest expense and amortization
of convertible senior notes
issuance costs and
debt discount | (11,365) | (12,899) |
| Foreign currency exchange gain, net | 925 | 752 |
| Government subsidy | 13,819 | 360 |
| Others | (5,236) | (40) |
| | ------ | --- |
| Profit (loss) before income tax | 35,943 | (246,432) |
| Income tax (expense) benefit | (6,562) | 29,543 |
| | ------ | ------ |
Net income (loss) after taxes
before non-controlling interests | 29,381 | (216,889) |
Loss attributable to non-
controlling interests | 60 | - |
| | --- | --- |
Net income (loss) attributable
to LDK Solar Co., Ltd. shareholders | 29,441 | (216,889) |
| | ------ | -------- |
| Net income (loss) per ADS, Diluted | $0.27 | $(2.03) |
| | ----- | ------ |
About LDK Solar (NYSE: LDK)
LDK Solar Co., Ltd. is a leading manufacturer of multicrystalline solar wafers, which are the principal raw material used to produce solar cells. LDK Solar sells multicrystalline wafers globally to manufacturers of photovoltaic products, including solar cells and solar modules. In addition, LDK Solar provides wafer processing services to monocrystalline and multicrystalline solar cell and module manufacturers. LDK Solar's headquarters and manufacturing facilities are located in Hi-Tech Industrial Park, Xinyu City, Jiangxi Province in the People's Republic of China. LDK Solar's office in the United States is located in Sunnyvale, California.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this press release are forward-looking statements, including but not limited to, LDK Solar's ability to raise additional capital to finance its operating activities, the effectiveness, profitability and marketability of its products, the future trading of its securities, the ability of LDK Solar to operate as a public company, the period of time during which its current liquidity will enable LDK Solar to fund its operations, its ability to protect its proprietary information, the general economic and business environment and conditions, the volatility of LDK Solar's operating results and financial condition, its ability to attract and retain qualified senior management personnel and research and development staff, its ability to timely and efficiently complete its ongoing construction projects, including its polysilicon plants, and other risks and uncertainties disclosed in LDK Solar's filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on information available to LDK Solar's management as of the date hereof and on its current expectations, assumptions, estimates and projections about LDK Solar and the solar industry. Actual results may differ materially from the anticipated results because of such and other risks and uncertainties. LDK Solar undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, or changes in its expectations, assumptions, estimates and projections except as may be required by law.
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