SEOUL, South Korea,
Aug. 10, 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 second quarter ended
June 30, 2017. The Company will host
a conference call to discuss the results at 8:00 a.m. Eastern Time (9:00 p.m. Korea Standard Time) on August 10, 2017.
Second Quarter 2017 Highlights
- Net revenues were $577.7 million,
compared with $432.0 million in the
first quarter of 2017 and $638.0
million in the second quarter of 2016.
- Gross margin was 11.6%, compared with 13.8% in the first
quarter of 2017 and 23.7% in the second quarter of 2016.
- Operating income was $20.1
million, compared with operating income of $28.3 million in the first quarter of 2017 and
operating income of $84.5 million in
the second quarter of 2016.
- Net income attributable to the Company's ordinary shareholders
was $18.7 million, compared with net
income of $17.6 million in the first
quarter of 2017 and net income of $76.8
million in the second quarter of 2016.
- Earnings per fully diluted American Depositary Share ("ADS" and
each ADS represents 50 of the Company's ordinary shares) were
$0.22, compared with earnings per
fully diluted ADS of $0.21 in the
first quarter of 2017 and earnings per fully diluted ADS of
$0.92 in the second quarter of
2016.
"Our second quarter results were in-line with our guidance and
we are pleased to report that we are continuing to realize profits
despite uncertainties in some of the major solar markets around the
world," said Mr. Seong-woo Nam, Chairman and CEO of Hanwha Q CELLS.
Mr. Nam continued, "We focused on expanding our footprint in
markets with favorable conditions in response to the constantly
changing market dynamics."
"Our 60 cell mono-PERC module, Q.PEAK, with output up to 305 Wp,
continues to be well received in the residential market worldwide
and is continuing to strengthen our competitiveness throughout all
market segments," Mr. Nam remarked. Mr. Nam also stated that the
Company is expected to "launch 72-cell mono-PERC modules, with
output up to 365 Wp, in the second half of the year."
Mr. Jay Seo, CFO of Hanwha Q
CELLS, said "We are continuing to strengthen our balance sheet by
continuing to pay off interest-bearing debt instruments. Our
debt-to-equity ratio, as of second quarter end was 361%, down 80%
points from year-end 2016." Mr. Seo continued, "Given our capacity
to continuously generate positive operating results, we expect to
be well positioned to improve our financial position."
Second Quarter 2017 Results of Operations
Net Revenues
- Total net revenues were $577.7
million, up 33.7% from $432.0
million in the first quarter of 2017 and down 9.5% from
$638.0 million in the second quarter
of 2016.
Gross Profit and Margin
- Gross profit in the second quarter of 2017 was $67.2 million, compared with $59.8 million in the first quarter of 2017 and
$151.2 million in the second quarter
of 2016.
- Gross margin in the second quarter of 2017 was 11.6%, compared
with 13.8% in the first quarter of 2017 and 23.7% in the second
quarter of 2016.
Income from Operations and Operating Margin
- Income from operations in the second quarter of 2017 was
$20.1 million, compared with
$28.3 million in the first quarter of
2017 and $84.5 million in the second
quarter of 2016.
- Operating margin in the second quarter of 2017 was 3.5%,
compared with 6.6% in the first quarter of 2017 and 13.2% in the
second quarter of 2016.
- Total operating expenses were $47.1
million in the second quarter of 2017, up 49.5% from
$31.5 million in the first quarter of
2017 and down 29.4% from $66.7
million in the second quarter of 2016.
- Selling and marketing expenses were $29.5 million in the second quarter of 2017, up
34.7% from $21.9 million in the first
quarter of 2017 and down 10.9% from $33.1
million in the second quarter of 2016.
- General and administrative expenses were $13.5 million in the second quarter of 2017, down
25.8% from $18.2 million in the first
quarter of 2017 and down 31.1% from $19.6
million in the second quarter of 2016.
- Research and development expenses were $4.1 million in the second quarter of 2017, down
53.4% from $8.8 million in the first
quarter of 2017 and down 70.7% from $14.0
million in the second quarter of 2016.
Net Interest Expense
- Net interest expense was $9.2
million in the second quarter of 2017, compared with
$9.5 million in the first quarter of
2017 and $9.3 million in the second
quarter of 2016.
Foreign Currency Exchange Gain (Loss)
- Net foreign currency exchange gain was $7.1 million in the second quarter of 2017,
compared with a gain of $2.5 million
in the first quarter of 2017 and a gain of $1.8 million in the second quarter of 2016.
Gain (loss) on Change in Fair Value of Derivative
Contracts
- The Company recorded a net loss of $3.0
million in the second quarter of 2017 from the change in
fair value of derivatives in hedging activities, compared with a
net loss of $0.4 million in the first
quarter of 2017 and a net loss of $13.7
million in the second quarter of 2016.
Income Tax Expense (Benefit)
- Income tax benefit was $3.0
million in the second quarter of 2017, compared with an
income tax expense of $5.4 million in
the first quarter of 2017 and an income tax benefit of $8.8 million in the second quarter of 2016.
Net Income (Loss) and Earnings (Loss) per ADS
- Net income attributable to the Company's ordinary shareholders
was $18.7 million in the second
quarter of 2017, compared with net income of $17.6 million in the first quarter of 2017 and
net income of $76.8 million in the
second quarter of 2016.
- Earnings per fully diluted ADS on a GAAP basis were
$0.22 in the second quarter of 2017,
compared with $0.21 in the first
quarter of 2017 and $0.92 in the
second quarter of 2016.
Second Quarter 2017 Financial Position
As of June 30, 2017, the Company
had cash and cash equivalents of $331.0
million, compared with $516.1
million as of March 31, 2017.
The restricted cash as of June 30,
2017 was $95.0 million,
compared with $110.7 million as of
March 31, 2017.
As of June 30, 2017, accounts
receivable was $358.4 million,
compared with $295.3 million, as of
March 31, 2017. Inventories were
$337.2 million as of June 30, 2017, compared with $399.3 million as of March
31, 2017.
As of June 30, 2017, accounts
payable was $407.8 million, compared
with $464.6 million, as of
March 31, 2017.
Total short-term bank borrowings (including the current portion
of long-term bank borrowings) were $635.5
million, an increase of $203.0
million from the first quarter of 2017, due to a
reclassification of long-term bank borrowings as short-term
borrowings.
As of June 30, 2017, the Company
had total long-term debt (net of current portion and long-term
notes) of $336.1 million, a decrease
of $306.9 million from the first
quarter of 2017. The Company's long-term debt is comprised of bank
and government borrowings, to be repaid in installments until their
maturities, ranging from one to fourteen years.
Capital expenditures were $14.0
million in the second quarter of 2017.
Operations Updates
Production Capacity
As of June 30, 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 improvements and de-bottlenecking of our production
operations.
Furthermore, the Company has additional module availability of
up to 2,100 MW (annualized) as of June 30,
2017 from Hanwha Q CELLS Korea Corporation, an affiliate of
the Company. Hanwha Q CELLS Korea Corporation is currently
ramping-up its capacity with expected capacity of approximately
2,200 MW in the second half of 2017.
Business Outlook
Third Quarter and Full Year 2017 Guidance
For the third quarter of 2017, the Company estimates net
revenues in the range of $540 to 560
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 a.m. Eastern Time
(9:00 p.m. Korea Standard Time) on
August 10, 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:
https://edge.media-server.com/m6/p/dcywj8kq.
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 the
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:
63369727
|
|
Replay time period: August 10,
2017 11:00 a.m. ET –
August 18, 2017 09:59 a.m. 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 partnerships to its customers in the
utility, commercial, governmental 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
third 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. Such risks and
uncertainties include pending administrative and civil actions in
the United States under existing
or potential new statutes and regulations governing trade between
the United States and other
countries, and potential antidumping, countervailing or other
duties imposed on goods imported into the
United States, as well as the Company's access to new
capacity from an affiliate. 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)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
June 30,
2017
|
|
December 31,
2016
|
|
ASSETS
|
|
|
|
|
(unaudited)
|
|
(audited)
|
|
Current
assets
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
331.0
|
|
390.0
|
|
|
Restricted
cash
|
|
95.0
|
|
116.8
|
|
|
Accounts and notes
receivable - net
|
|
358.4
|
|
328.1
|
|
|
Receivables from
related parties
|
|
112.4
|
|
83.6
|
|
|
Inventories
|
|
|
337.2
|
|
338.5
|
|
|
Loans to related
parties
|
|
12.0
|
|
13.0
|
|
|
Other current
assets
|
|
100.0
|
|
81.5
|
|
|
Total current assets
|
|
1,346.0
|
|
1,351.5
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Fixed assets -
net
|
|
775.2
|
|
755.5
|
|
|
Intangible assets -
net
|
|
17.8
|
|
16.6
|
|
|
Land use rights -
net
|
|
48.8
|
|
47.9
|
|
|
Deferred tax assets -
net
|
|
7.2
|
|
6.1
|
|
|
Loans to related
parties
|
|
7.0
|
|
6.6
|
|
|
Other long-term
assets
|
|
28.6
|
|
24.9
|
|
|
Total assets
|
|
2,230.6
|
|
2,209.1
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
|
Current
liabilities
|
|
|
|
|
|
|
Accounts
payable
|
|
169.9
|
|
171.1
|
|
|
Notes
payable
|
|
65.3
|
|
107.2
|
|
|
Payables to related
parties
|
|
172.6
|
|
161.6
|
|
|
Deferred
revenue
|
|
207.6
|
|
18.9
|
|
|
Accrued
expenses
|
|
46.8
|
|
36.6
|
|
|
Other
payables
|
|
19.9
|
|
20.2
|
|
|
Tax
payables
|
|
8.1
|
|
16.0
|
|
|
Short-term
debt
|
|
175.6
|
|
377.4
|
|
|
Current portion of
long-term debt
|
|
459.9
|
|
150.5
|
|
|
Customer
deposits
|
|
14.4
|
|
17.3
|
|
|
Derivative
contracts
|
|
1.4
|
|
1.0
|
|
|
Litigation
accruals
|
|
0.4
|
|
1.8
|
|
|
Deferred tax
liabilities
|
|
-
|
|
2.4
|
|
|
Warranty
provision
|
|
40.5
|
|
42.2
|
|
|
Other current
liabilities
|
|
2.5
|
|
6.1
|
|
|
Total current
liabilities
|
|
1,384.9
|
|
1,130.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Long-term
debt
|
|
336.1
|
|
643.7
|
|
|
Long-term warranty
provision
|
|
17.0
|
|
19.0
|
|
|
Deferred tax
liabilities
|
|
8.6
|
|
7.9
|
|
|
Total liabilities
|
|
1,746.6
|
|
1,800.9
|
|
Stockholders'
equity
|
|
|
|
|
|
|
Ordinary
shares
|
|
0.4
|
|
0.4
|
|
|
Additional paid-in
capital
|
|
432.0
|
|
431.7
|
|
|
Accumulated
income
|
|
143.6
|
|
107.3
|
|
|
Accumulated other
comprehensive loss
|
|
(92.0)
|
|
(131.2)
|
|
|
Total stockholders'
equity
|
|
484.0
|
|
408.2
|
|
|
Total liabilities,
redeemable ordinary shares and stockholders' equity
|
2,230.6
|
|
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
|
|
For the six months
ended
|
|
|
|
|
June 30,
2017
|
|
March 31,
2017
|
|
June 30,
2017
|
|
June 30,
2016
|
|
|
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
|
(unaudited)
|
Net sales
|
|
577.7
|
|
432.0
|
|
1,009.7
|
|
1,152.9
|
Cost of goods
sold
|
510.5
|
|
372.2
|
|
882.7
|
|
892.7
|
Gross profit
|
67.2
|
|
59.8
|
|
127.0
|
|
260.2
|
Selling and marketing
expenses
|
29.5
|
|
21.9
|
|
51.4
|
|
55.9
|
General and
administrative expenses
|
13.5
|
|
18.2
|
|
31.7
|
|
37.5
|
Research and
development expenses
|
4.1
|
|
8.8
|
|
12.9
|
|
25.6
|
Other operating
expenses (income)
|
-
|
|
(17.4)
|
|
(17.4)
|
|
-
|
Income from operations
|
20.1
|
|
28.3
|
|
48.4
|
|
141.2
|
Other income
(expenses)
|
|
|
|
|
|
|
|
Interest income
|
2.1
|
|
1.0
|
|
3.1
|
|
4.8
|
Interest expense
|
(11.3)
|
|
(10.5)
|
|
(21.8)
|
|
(26.9)
|
Foreign exchange gain
(loss)
|
7.1
|
|
2.5
|
|
9.6
|
|
5.8
|
Gain (loss) on change in
fair value of derivative contracts
|
(3.0)
|
|
(0.4)
|
|
(3.4)
|
|
(29.0)
|
Investment income
(loss)
|
0.9
|
|
1.2
|
|
2.1
|
|
(1.5)
|
Other income (expense) -
net
|
(0.2)
|
|
0.9
|
|
0.7
|
|
5.8
|
Other expense,
net
|
(4.4)
|
|
(5.3)
|
|
(9.7)
|
|
(41.0)
|
Income before income tax
|
15.7
|
|
23.0
|
|
38.7
|
|
100.1
|
|
|
|
|
|
|
|
|
|
|
|
Income tax expense
(benefit)
|
(3.0)
|
|
5.4
|
|
2.4
|
|
(4.2)
|
Net income
|
18.7
|
|
17.6
|
|
36.3
|
|
104.3
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Hanwha Q CELLS Co., Ltd.'s stockholders per
share:
|
|
|
|
|
|
|
Basic
|
|
|
US$0.00
|
|
US$0.00
|
|
US$0.01
|
|
US$0.03
|
Diluted
|
|
US$0.00
|
|
US$0.00
|
|
US$0.01
|
|
US$0.03
|
|
|
|
|
|
|
|
|
|
|
|
Net income
attributable to Hanwha Q CELLS Co., Ltd.'s stockholders per
ADS:
|
|
|
|
|
|
|
Basic
|
|
|
US$0.22
|
|
US$0.21
|
|
US$0.44
|
|
US$1.25
|
Diluted
|
|
US$0.22
|
|
US$0.21
|
|
US$0.44
|
|
US$1.25
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares used
in computation of net income per share:
|
|
|
|
|
|
|
|
Basic
|
|
|
4,158,769,098
|
|
4,158,769,098
|
|
4,158,769,098
|
|
4,158,998,117
|
Diluted
|
|
4,158,769,098
|
|
4,158,769,098
|
|
4,158,769,098
|
|
4,159,363,156
|
|
|
|
|
|
|
|
|
|
|
|
Number of shares used
in computation of net income per ADS:
|
|
|
|
|
|
|
|
Basic
|
|
|
83,175,382
|
|
83,175,382
|
|
83,175,382
|
|
83,179,962
|
Diluted
|
|
83,175,382
|
|
83,175,382
|
|
83,175,382
|
|
83,187,263
|
|
|
|
|
|
|
|
|
|
|
|
Other comprehensive
income (loss)
|
|
|
|
|
|
|
|
Foreign currency translation
adjustment
|
16.4
|
|
22.9
|
|
39.3
|
|
(7.3)
|
Pension
adjustments
|
-
|
|
-
|
|
-
|
|
-
|
Comprehensive
income
|
35.1
|
|
40.5
|
|
75.6
|
|
97.0
|
View original
content:http://www.prnewswire.com/news-releases/hanwha-q-cells-reports-second-quarter-2017-results-300502611.html
SOURCE Hanwha Q CELLS Co., Ltd.