SEOUL, South Korea, May 25,
2017 /PRNewswire/ -- Hanwha Q CELLS Co., Ltd. ("Hanwha Q
CELLS" or the "Company") (NASDAQ: HQCL), a global leading
photovoltaic manufacturer of high-performance, high-quality solar
modules, today reported its unaudited financial results for the
first quarter ended March 31, 2017.
The Company will host a conference call to discuss the results at
8:00 am Eastern Time (9:00 pm Korea Standard Time) on May 25, 2017.
First Quarter 2017 Highlights
- Net revenues were $432.0 million,
compared with $565.2 million in the
fourth quarter of 2016 and $514.9
million in the first quarter of 2016.
- Gross margin was 13.8%, compared with 7.0% in the fourth
quarter of 2016 and 21.2% in the first quarter of 2016.
- Operating income was $28.3
million, compared with operating loss of $21.5 million in the fourth quarter of 2016 and
operating income of $56.7 million in
the first quarter of 2016.
- Net income attributable to Company's ordinary shareholders was
$17.6 million, compared with net loss
of $18.5 million in the fourth
quarter of 2016 and net income of $27.5
million in the first quarter of 2016.
- Earnings per fully diluted American Depositary Share ("ADS" and
each ADS represents 50 of the Company's ordinary shares) were
$0.21, compared with loss per fully
diluted ADS of $0.22 in the fourth
quarter of 2016 and earnings per fully diluted ADS of $0.33 in the first quarter of 2016.
"Our first quarter results were modestly ahead of our plan and
we are pleased to report that we have returned to a profitable
quarter despite a challenging industry environment," said Mr.
Seong-woo Nam, Chairman and CEO of Hanwha Q CELLS. Mr. Nam
continued "We have been focusing on strengthening our sales backlog
early on to increase our operational visibility in 2017 while
diversifying our regional and segmental business profile to better
navigate different market cycles."
"From our products side, we are now offering a more balanced
products portfolio with an official launch of our proprietary
mono-PERC module series, called Q.PEAK," Mr. Nam remarked.
"Our first launch was made in the United
States, Europe,
Japan and Australia with 60-cell modules reaching up to
305 Wp in the first quarter. This will be followed by the launch of
72-cell modules reaching up to 370 Wp in the second half of this
year. Our new mono-PERC modules are already in high demand, and we
are excited that our stronger product line-up will enable us to
compete more effectively in the broader market segments."
Mr. Jay Seo, CFO of Hanwha Q
CELLS, said "We are making good progress strengthening our balance
sheet by continuing to pay off certain interest-bearing instruments
and we have brought down our net debt-to-equity ratio to 125% this
quarter compared with 191% in the previous quarter." Mr. Seo
continued, "We believe that we are well-positioned to navigate
through different industry cycles with our strong technology,
product portfolios and cost competitiveness, and we'll prudently
manage our operations to continue sustainable growth."
First Quarter 2017 Financial Results
Net Revenues
- Total net revenues were $432.0
million, down 23.6% from $565.2
million in the fourth quarter of 2016 and down 16.1% from
$514.9 million in the first quarter
of 2016.
Gross Profit and Margin
- Gross profit in the first quarter of 2017 was $59.8 million, compared with $39.6 million in the fourth quarter of 2016 and
$109.0 million in the first quarter
of 2016.
- Gross margin in the first quarter of 2017 was 13.8%, compared
with 7.0% in the fourth quarter of 2016 and 21.2% in the first
quarter of 2016.
Income from Operations and Operating Margin
- Income from operations in the first quarter of 2017 was
$28.3 million, compared with a loss
from operations of $21.5 million in
the fourth quarter of 2016 and income from operations of
$56.7 million in the first quarter of
2016.
- Operating margin in the first quarter of 2017 was 6.6%,
compared with -3.8% in the fourth quarter of 2016 and 11.0% in the
first quarter of 2016.
- Total operating expenses were $31.5
million in the first quarter of 2017, down 48.4% from
$61.1 million in the fourth quarter
of 2016 and down 39.8% from $52.3
million in the first quarter of 2016.
- Selling and marketing expenses were $21.9 million in the first quarter of 2017, down
21.2% from $27.8 million in the
fourth quarter of 2016 and down 3.9% from $22.8 million in the first quarter of 2016.
- General and administrative expenses were $18.2 million in the first quarter of 2017, down
13.3% from $21.0 million in the
fourth quarter of 2016 and up 1.7% from $17.9 million in the first quarter of 2016.
- Research and development expenses were $8.8 million in the first quarter of 2017, down
24.1% from $11.6 million in the
fourth quarter of 2016 and down 24.1% from $11.6 million in the first quarter of 2016.
Net Interest Expense
- Net interest expense was $9.5
million in the first quarter of 2017, compared with
$12.0 million in the fourth quarter
of 2016 and $12.8 million in the
first quarter of 2016. This was largely due to the payment of
principal on certain interest-bearing debt instruments.
Foreign Currency Exchange Gain (Loss)
- Net foreign currency exchange gain was $2.5 million in the first quarter of 2017,
compared with a net loss of $6.9
million in the fourth quarter of 2016 and net gain of
$4.0 million in the first quarter of
2016.
Gain (loss) on Change in Fair Value of Derivative
Contracts
- The Company recorded a net loss of $0.4
million in the first quarter of 2017 from the change in fair
value of derivatives in hedging activities, compared with a net
gain of $6.7 million in the fourth
quarter of 2016 and a net loss of $15.3
million in the first quarter of
2016.
Income Tax Expense (Benefit)
- Income tax expense was $5.4
million in the first quarter of 2017, compared with an
income tax benefit of $10.4 million
in the fourth quarter of 2016 and an income tax expense of
$4.6 million in the first quarter of
2016.
Net Income (Loss) and Earnings (Loss) per ADS
- Net income attributable to Company's ordinary shareholders was
$17.6 million in the first quarter of
2017, compared with net loss of $18.5
million in the fourth quarter of 2016 and net income of
$27.5 million in the first quarter of
2016.
- Earnings per fully diluted ADS on a GAAP basis were
$0.21 in the first quarter of 2017,
compared with loss per fully diluted ADS of $0.22 in the fourth quarter of 2016 and earnings
per fully diluted ADS of $0.33 in the
first quarter of 2016.
Financial Position
As of March 31, 2017, the Company
had cash and cash equivalents of $516.1
million, compared with $390.0
million as of December 31,
2016. The restricted cash as of March
31, 2017 was $110.7 million,
compared with $116.8 million as of
December 31, 2016.
As of March 31, 2017, accounts
receivable was $295.3 million,
compared with $328.1 million, as of
December 31, 2016. Inventories were
$399.3 million as of March 31, 2017, compared with $338.5 million as of December 31, 2016.
Total short-term bank borrowings (including the current portion
of long-term bank borrowings) were $432.5
million, a decrease of $95.4
million from the fourth quarter of 2016, due to the
repayment of certain bank loans.
As of March 31, 2017, the Company
had total long-term debt (net of current portion and long-term
notes) of $643.0 million, a decrease
of $0.7 million from the fourth
quarter of 2016. The Company's long-term bank and government
borrowings are to be repaid in installments until their maturities,
which range from one to fourteen years.
Net cash provided by operating activities was $234.5 million in the first quarter of 2017.
Capital expenditures were $11.9
million in the first quarter of 2017.
Operations Updates
Production Capacity
As of March 31, 2017, the
Company's in-house, annualized production capacities were 1,550 MW
for ingot, 1,000 MW for wafer, 4,200 MW for cell and 4,200 MW for
module.
By the end of this year, we expect our annual nameplate
capacities to reach 1,600 MW for ingot, 1,100 MW for wafer, 4,600
MW for cell and 4,600 MW for module mainly from conversion
efficiency improvement and debottlenecking of our production
operations.
Furthermore, the Company has additional module availability of
up to 1,800 MW (annualized) as of March 31,
2017 from Hanwha Q CELLS Korea Corporation, an affiliate of
the Company. Hanwha Q CELLS Korea Corporation is currently
expanding its capacity with expected capacity of approximately
2,200 MW respectively in the second half of 2017.
Business Outlook
Second Quarter and Full Year 2017 Guidance
For the second quarter of 2017, the Company estimates net
revenues in the range of $560 to 580
million.
For the full year 2017, the Company reiterates its previous
guidance of:
- Total module shipments in the range of 5,500 to 5,700 MW
- Revenue-recognized module shipments in the range of 5,300 to
5,500 MW
- Capital expenditures of approximately $50 million for manufacturing technology upgrades
and certain R&D related expenditures
Conference Call
The Company will host a conference call to discuss the results
at 8:00 am Eastern Time (9:00 pm Korea Standard Time) on May 25, 2017. The management will discuss the
results and take questions following the prepared remarks.
A live webcast of the conference call will be available on the
investor relations section of the Company's website at
www.hanwha-qcells.com or by clicking the following hyperlink:
http://edge.media-server.com/m/p/iar4z3gn.
The dial-in details for the live conference call are as
follows:
International Toll
Free Dial-In Number
|
+65
67135090
|
United
States
|
+1 (845)
675-0437
|
South
Korea
|
+82 (0)2
6490-3660
|
Germany
|
08001820671
|
United
Kingdom
China,
Domestic
Hong Kong
|
+44
2036214779
8008190121 /
4006208038
+852
30186771
|
|
|
Passcode:
HQCL
|
|
A replay of the call will be available after the conclusion of
the conference call on the investor relations section of the
Company's website at www.hanwha-qcells.com and also by dialing
numbers below:
International Toll
Free Dial-In Number
|
+61 2 8199
0299
|
United
States
|
+1 (855)
452-5696
|
South
Korea
|
0079861361602
|
Germany
United
Kingdom
|
08001802149
08082340072
|
China,
Domestic
Hong Kong
|
8008700206 /
4006322162
800963117
|
|
|
Conference ID:
22649435
|
|
Replay time period: May 25, 2017
11:00 ET – June 2, 2017 09:59
ET
About Hanwha Q CELLS
Hanwha Q CELLS Co., Ltd. (NASDAQ:HQCL) is one of the world´s
largest and most recognized photovoltaic manufacturers for its
high-performance, high-quality solar cells and modules. It is
headquartered in Seoul, South
Korea (Global Executive HQ) and Thalheim, Germany (Technology & Innovation HQ), with
diverse international manufacturing facilities in Malaysia and China. Hanwha Q CELLS offers the full spectrum
of photovoltaic products, applications and solutions, from modules
to kits to systems to large scale solar power plants. Through its
growing global business network spanning Europe, North
America, Asia, South America, Africa and the Middle East, the company provides excellent
services and long-term partnership to its customers in the utility,
commercial, government and residential markets. Hanwha Q CELLS is a
flagship company of Hanwha Group, a FORTUNE Global 500 firm and a
Top 10 business enterprise in South
Korea. For more information, visit:
http://www.hanwha-qcells.com/.
Safe Harbor Statement
This report contains forward-looking statements that are not
statements of historical fact. These statements constitute
"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, and as defined in the
U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as
"will," "expects," "anticipates," "future," "intends," "plans,"
"believes," "estimates" and similar statements. Such statements,
particularly statements about our guidance for performance in the
second quarter and the full year 2017, involve certain risks and
uncertainties that could cause actual results to differ materially
from those in the forward-looking statements. Further information
regarding these and other risks is included in Hanwha Q CELLS'
filings with the Securities and Exchange Commission, including its
annual report on Form 20-F. Except as required by law, Hanwha Q
CELLS does not undertake any obligation to update any
forward-looking statements, whether as a result of new information,
future events or otherwise.
Hanwha Q CELLS
Co., Ltd.
|
Unaudited Condensed
Consolidated Balance Sheets
|
(in millions of US
dollars, except share data)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
March 31,
2017
|
|
December 31,
2016
|
|
ASSETS
|
|
|
|
|
(unaudited)
|
|
(audited)
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
516.1
|
|
390.0
|
|
|
Restricted
cash
|
|
110.7
|
|
116.8
|
|
|
Accounts and notes
receivable - net
|
|
295.3
|
|
328.1
|
|
|
Receivables from
related parties
|
|
124.3
|
|
83.6
|
|
|
Inventories
|
|
|
399.3
|
|
338.5
|
|
|
Loans to related
parties
|
|
12.0
|
|
13.0
|
|
|
Other current
assets
|
|
99.0
|
|
81.5
|
|
|
Total current assets
|
|
1,556.7
|
|
1,351.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed assets -
net
|
|
762.0
|
|
755.5
|
|
|
Intangible assets -
net
|
|
14.7
|
|
16.6
|
|
|
Land use rights -
net
|
|
48.2
|
|
47.9
|
|
|
Deferred tax assets -
net
|
|
7.2
|
|
6.1
|
|
|
Loans to related
parties
|
|
6.6
|
|
6.6
|
|
|
Other long-term
assets
|
|
28.8
|
|
24.9
|
|
|
Total assets
|
|
2,424.2
|
|
2,209.1
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts
payable
|
|
147.4
|
|
171.1
|
|
|
Notes
payable
|
|
88.4
|
|
107.2
|
|
|
Payables to related
parties
|
|
228.8
|
|
161.6
|
|
|
Deferred
revenue
|
|
252.0
|
|
18.9
|
|
|
Accrued
expenses
|
|
38.3
|
|
36.6
|
|
|
Other
payables
|
|
19.8
|
|
20.2
|
|
|
Tax
payables
|
|
21.6
|
|
16.0
|
|
|
Short-term
debt
|
|
281.0
|
|
377.4
|
|
|
Current portion of
long-term debt
|
|
151.5
|
|
150.5
|
|
|
Customer
deposits
|
|
26.5
|
|
17.3
|
|
|
Derivative
contracts
|
|
0.6
|
|
1.0
|
|
|
Litigation
accruals
|
|
1.0
|
|
1.8
|
|
|
Deferred tax
liabilities
|
|
-
|
|
2.4
|
|
|
Warranty
provision
|
|
43.1
|
|
42.2
|
|
|
Other current
liabilities
|
|
6.6
|
|
6.1
|
|
|
Total current
liabilities
|
|
1,306.6
|
|
1,130.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
643.0
|
|
643.7
|
|
|
Long-term warranty
provision
|
|
16.3
|
|
19.0
|
|
|
Deferred tax
liabilities
|
|
9.7
|
|
7.9
|
|
|
Total
liabilities
|
|
1,975.6
|
|
1,800.9
|
|
Stockholders'
equity
|
|
|
|
|
|
|
Ordinary
shares
|
|
0.4
|
|
0.4
|
|
|
Additional paid-in
capital
|
|
431.7
|
|
431.7
|
|
|
Accumulated
income
|
|
124.9
|
|
107.3
|
|
|
Accumulated other
comprehensive loss
|
|
(108.4)
|
|
(131.2)
|
|
|
Total stockholders'
equity
|
|
448.6
|
|
408.2
|
|
|
Total liabilities,
redeemable ordinary shares and stockholders' equity
|
2,424.2
|
|
2,209.1
|
|
Hanwha Q CELLS
Co., Ltd.
|
Unaudited Condensed
Consolidated Statements of Operations and Comprehensive Income
(Loss)
|
(in millions of US
dollars, except share data and net income (loss) per
share)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
For the three months
ended
|
|
|
|
|
|
March 31,
2017
|
|
December 31,
2016
|
|
March 31,
2016
|
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
Net sales
|
|
432.0
|
|
565.2
|
|
514.9
|
|
Cost of goods
sold
|
372.2
|
|
525.6
|
|
405.9
|
|
Gross
profit
|
59.8
|
|
39.6
|
|
109.0
|
|
Selling and marketing
expenses
|
21.9
|
|
27.8
|
|
22.8
|
|
General and
administrative expenses
|
18.2
|
|
21.0
|
|
17.9
|
|
Research and
development expenses
|
8.8
|
|
11.6
|
|
11.6
|
|
Restructuring
charges
|
-
|
|
0.7
|
|
-
|
|
Other operating
expenses (income)
|
(17.4)
|
|
-
|
|
-
|
|
Income
(loss) from operations
|
28.3
|
|
(21.5)
|
|
56.7
|
|
Other income
(expenses)
|
|
|
|
|
|
|
Interest income
|
1.0
|
|
3.1
|
|
3.1
|
|
Interest expense
|
(10.5)
|
|
(15.1)
|
|
(15.9)
|
|
Foreign exchange gain
(loss)
|
2.5
|
|
(6.9)
|
|
4.0
|
|
Gain (loss) on change in
fair value of derivative contracts
|
(0.4)
|
|
6.7
|
|
(15.3)
|
|
Investment income
(loss)
|
1.2
|
|
1.2
|
|
(1.5)
|
|
Other income (expense) -
net
|
0.9
|
|
3.6
|
|
1.0
|
|
Other expense,
net
|
(5.3)
|
|
(7.4)
|
|
(24.6)
|
|
Income (loss) before income tax
|
23.0
|
|
(28.9)
|
|
32.1
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
5.4
|
|
(10.4)
|
|
4.6
|
|
Net income (loss)
|
17.6
|
|
(18.5)
|
|
27.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Hanwha Q CELLS Co., Ltd.'s stockholders per
share:
|
|
|
|
Basic
|
|
|
US$0.00
|
|
US$0.00
|
|
US$0.01
|
|
Diluted
|
|
US$0.00
|
|
US$0.00
|
|
US$0.01
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss)
attributable to Hanwha Q CELLS Co., Ltd.'s stockholders per
ADS:
|
|
|
|
Basic
|
|
|
US$0.21
|
|
(US$0.22)
|
|
US$0.33
|
|
Diluted
|
|
US$0.21
|
|
(US$0.22)
|
|
US$0.33
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares used
in computation of net income (loss) per share:
|
|
|
|
|
|
Basic
|
|
|
4,158,769,098
|
|
4,159,051,773
|
|
4,158,891,211
|
|
Diluted
|
|
4,158,769,098
|
|
4,159,287,244
|
|
4,159,413,477
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares used
in computation of net income (loss) per ADS:
|
|
|
|
|
|
Basic
|
|
|
83,175,382
|
|
83,181,035
|
|
83,177,824
|
|
Diluted
|
|
83,175,382
|
|
83,185,745
|
|
83,188,270
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
Foreign currency translation
adjustment
|
22.9
|
|
(50.5)
|
|
22.4
|
|
Pension
adjustments
|
-
|
|
(0.3)
|
|
-
|
|
Comprehensive income
(loss)
|
40.5
|
|
(69.3)
|
|
49.9
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/hanwha-q-cells-reports-first-quarter-2017-results-300463821.html
SOURCE Hanwha Q CELLS Co., Ltd.