Shipment Volume, Gross Margin Exceed Company Guidance
Fourth Quarter and Full Year 2009 Financial and Operating Highlights:
-- Fourth quartershipments of 231MW, above the company's revised guidance of210MW, representing an increase of 30.5% sequentially and 278.7% year-over-year
-- 2009 annual shipments of 509 MW, representing an increase of 83.8% over 2008
-- Fourth quarter gross margin was 20.5%, up from 16.7% in Q3 and above the company's guidance of 17% to 20%
-- Fourth quarter operating income of $36million and operating margin of 15.1%
-- Fourth quarter net income of $22.3M and GAAP EPS of $0.14
-- Generated positive operating cash flow of $71M or $0.42 per diluted ADS
-- Maintained strong balance sheet and liquidity with over $273M in cash
"We are very pleased to report the highest shipment volumes in our company's history," said Dr. Peng Fang, CEO of JA Solar. "During 2009, JA Solar has focused its strategy on delivering excellent customer service, the highest product quality, and technology innovation, which has helped us win additional customers and increase market share," said Dr. Fang.
Fourth Quarter 2009 Financial Results
Total shipments in the fourth quarter of 2009 was a record 231MW, compared with third quarter shipments of 177MW, representing sequential growth of 30.5 percent. Compared with the same period last year, shipment growth was 278.7 percent, up from 61MW in the fourth quarter of 2008.
Revenue in the fourth quarter of 2009 was RMB 1.6 billion ($238.4 million), an increase of 23.4 percent from RMB 1.3 billion ($193 million) reported in the third quarter of 2009 and an increase of 66.2 percent from RMB 979.0 million ($143.4 million) reported in the fourth quarter of 2008.
Gross profit in the fourth quarter of 2009 was RMB 333.8 million ($48.9 million), compared with RMB 220.5 million ($32.3 million) in the third quarter of 2009 and RMB 9.7 million ($1.4 million) in the fourth quarter of 2008. Gross margin was 20.5% in the fourth quarter of 2009, compared with 16.7% in the third quarter of 2009 and 1.0% in the fourth quarter of 2008.
Total operating expenses in the fourth quarter of 2009 were RMB 88.3 million ($12.9 million), compared with RMB 72.3 million ($10.6 million) in the third quarter of 2009 and RMB 130.8 million ($19.2 million) in the fourth quarter of 2008.
Operating income in the fourth quarter of 2009 was RMB 245.5 million ($36 million), compared with an operating income of RMB 148.2 million ($21.7 million) in the third quarter of 2009 and operating loss of RMB 121.1 million (a loss of $17.7 million) in the fourth quarter of 2008. Operating margin was 15.1 percent in the fourth quarter of 2009, compared with 11.2 percent in the third quarter of 2009 and -12.4 percent in the fourth quarter of 2008.
Earnings per diluted ADS in the fourth quarter of 2009 were RMB 0.94 ($0.14), compared with RMB 0.66 ($0.10) in the third quarter of 2009 and net loss per diluted ADS of RMB 0.68 (a loss of $0.10) in the fourth quarter of 2008.
In the fourth quarter of 2009, the company generated operating cash flow of RMB 487.5 million ($71.4 million) or RMB 2.87 ($0.42) per diluted ADS.
Fiscal Year 2009 Results
Fiscal year 2009 shipments were 509MW, an increase of 83.8 percent, from 277MW in 2008.
Total 2009 revenue was RMB 3.8 billion ($553.7 million) compared with RMB 5.5 billion ($799.6 million) in 2008.
Total gross profit in 2009 was RMB 479.9 million ($70.3 million) or 12.7 percent, compared with RMB 992.0 million ($145.3 million) or 18.2 percent in 2008. Operating income for 2009 was RMB 91.5 million ($13.4 million), compared with RMB 692.0 million ($101.4 million) in 2008. In 2009, net loss per diluted ADS was RMB 0.80 (a loss of $0.12), compared with net loss per diluted ADS of RMB 2.31 (a loss of $0.34) in 2008.
For fiscal year 2009, the company generated an operating cash flow of RMB 766.2 million ($112.2 million) or RMB 4.5 ($0.66) per diluted ADS.
Liquidity
The company maintained a strong balance sheet with cash and cash equivalents of RMB 1.9 billion ($273.6 million), and total working capital of RMB 3.0 billion ($444.2 million) at December 31, 2009. Total long term bank borrowings was RMB 680 million ($99.6 million) and convertible bonds outstanding was RMB 1.6 billion ($228.2 million) at December 31, 2009.
Operations and Business Outlook
Research & Development Update
JA solar has achieved an average conversion efficiency of 18.7% in R&D for its next-generation mono-crystalline silicon PV cells with the designed device architecture compatible with current production platform. Pilot production is expected by mid-year 2010, with large-scale volume production anticipated by year-end 2010.
Manufacturing Capacity Expansion
To meet the high demand for its solar cell and module products, the JA Solar expects to achieve solar cell capacity of 1.1GW by the end of 2010. The new solar cell capacity to be added in 2010 will be "high-efficiency-enabled" for large volume manufacturing of the company's new high-efficiency solar cell architecture. Module capacity is expected to reach 300MW by year end 2010 to meet customer demand. Wafer capacity is expected to reach 120MW by year end 2010.
First Quarter and Full Year 2010 Outlook
Based on robust customer demand for JA Solar's products and additional customer wins, the company is raising its outlook for the full year of 2010. The company currently expects shipments to exceed 900MW for 2010, compared with prior guidance in the range of 750MW to 800MW. Shipments in the first quarter of 2010 are expected to be in the range of 215MW to 225MW.
"We continue to see strong demand from our existing customers as well as from new customers, and expect strong shipments for full year 2010 based on robust orders from a diversified customer base across multiple geographies. Going into 2010, we will focus on further extending our leadership in solar cell technology, product quality, and manufacturing cost. We continue to expand our customer base for our core solar cell business. Leveraging our strong solar cell platform, we plan to expand module facility in response to strong customer demand, and build up wafer capacity to improve quality and reduce cost. Our goal, as always, is to provide our customers with highest quality products at the best price," said Dr. Fang.
