First Solar, Inc. Announces Third Quarter 2019 Financial Results
October 24 2019 - 4:05PM
First Solar, Inc. (Nasdaq: FSLR) today announced financial results
for the third quarter ended September 30, 2019. Net sales for
the third quarter were $547 million, a decrease of $38 million from
the prior quarter, primarily due to lower systems revenue from
project sales in the United States, partially offset by higher
module sales volume.
The Company reported third quarter net income
per share of $0.29, compared to a loss per share of $(0.18) in the
prior quarter.
Cash, restricted cash and marketable securities
at the end of the third quarter decreased to $1.6 billion from $2.1
billion at the end of the prior quarter, primarily as a result of
higher expenditures for the development and construction of project
assets and continued capital investments in Series 6 manufacturing
capacity.
“We’re pleased with the ongoing progress of our
Series 6 technology platform,” said Mark Widmar, CEO of First
Solar. “Capacity utilization, throughput and yield continue to
improve, resulting in record Series 6 production of approximately 1
GW in the quarter.”
2019 guidance has been updated as follows:
2019 Guidance |
Prior |
Current |
Net Sales |
$3.5B to $3.7B |
Unchanged |
Gross Margin % (1) |
18.5% to 19.5% |
19% to 20% |
Operating Expenses (2) |
$360M to $380M |
$350M to $370M |
Operating Income |
$290M to $340M |
$320M to $370M |
Earnings per Share |
$2.25 to $2.75 |
Unchanged |
Net Cash Balance (3) |
$1.7B to $1.9B |
Unchanged |
Capital Expenditures |
$650M to $750M |
Unchanged |
Shipments |
5.4GW to 5.6GW |
Unchanged |
——————————
- Includes $70 to $80 million of ramp costs ($60 to $70 million
previously)
- Includes $40 to $50 million of production start-up expense ($55
to $65 million previously)
- Defined as cash, restricted cash and marketable securities less
expected debt at the end of 2019
First Solar has scheduled a conference call for
today, October 24, 2019 at 4:30 p.m. ET to discuss this
announcement. A live webcast of this conference call and
accompanying materials are available at
investor.firstsolar.com.
The guidance figures presented above are subject
to a variety of assumptions and estimates. Investors are encouraged
to listen to the conference call and to review the accompanying
materials, which contain more information about First Solar’s third
quarter financial results and 2019 guidance.
An audio replay of the conference call will be
available approximately two hours after the conclusion of the call.
The audio replay will remain available through Thursday, October
31, 2019 and can be accessed by dialing +1 (800) 585-8367 if you
are calling from within the United States or +1 (416) 621-4642 if
you are calling from outside the United States and entering the
replay pass code 8984796. A replay of the webcast will also be
available on the Investors section of the Company’s website
approximately five hours after the conclusion of the call and
remain available for approximately 90 days.
About First Solar, Inc.
First Solar is a leading global provider of
comprehensive photovoltaic (“PV”) solar systems which use its
advanced module and system technology. The Company's integrated
power plant solutions deliver an economically attractive
alternative to fossil-fuel electricity generation today. From raw
material sourcing through end-of-life module recycling, First
Solar’s renewable energy systems protect and enhance the
environment. For more information about First Solar, please visit
www.firstsolar.com.
For First Solar Investors
This release contains forward-looking statements
which are made pursuant to safe harbor provisions of the Private
Securities Litigation Reform Act of 1995. All statements in this
release, other than statements of historical fact, are
forward-looking statements. These forward-looking statements
include, but are not limited to, statements concerning: our
financial guidance for 2019; the transition to Series 6 module
manufacturing in 2019; net sales, gross margin, operating expenses,
operating income, earnings per share, net cash balance, capital
expenditures, shipments, bookings, products and our business and
financial objectives for 2019. These forward-looking statements are
often characterized by the use of words such as “estimate,”
“expect,” “anticipate,” “project,” “plan,” “intend,” “seek,”
“believe,” “forecast,” “foresee,” “likely,” “may,” “should,”
“goal,” “target,” “might,” “will,” “could,” “predict,” “continue”
and the negative or plural of these words and other comparable
terminology. Forward-looking statements are only predictions based
on our current expectations and our projections about future events
and therefore speak only as of the date of this release. You should
not place undue reliance on these forward-looking statements. We
undertake no obligation to update any of these forward-looking
statements for any reason, whether as a result of new information,
future developments or otherwise. These forward-looking statements
involve known and unknown risks, uncertainties and other factors
that may cause our actual results, levels of activity, performance
or achievements to differ materially from those expressed or
implied by these statements. These factors include, but are not
limited to: structural imbalances in global supply and demand for
PV solar modules; the market for renewable energy, including solar
energy; our competitive position and other key competitive factors;
reduction, elimination, or expiration of government subsidies,
policies, and support programs for solar energy projects; the
impact of public policies, such as tariffs or other trade remedies
imposed on solar cells and modules; our ability to execute on our
long-term strategic plans; our ability to execute on our solar
module technology and cost reduction roadmaps; our ability to
improve the wattage of our solar modules; interest rate
fluctuations and both our and our customers’ ability to secure
financing; the creditworthiness of our offtake counterparties and
the ability of our offtake counterparties to fulfill their
contractual obligations to us; the ability of our customers and
counterparties to perform under their contracts with us; the
satisfaction of conditions precedent in our project sales
agreements; our ability to attract new customers and to develop and
maintain existing customer and supplier relationships; our ability
to successfully develop and complete our systems business projects;
our ability to convert existing production facilities to support
new product lines, such as Series 6 module manufacturing; general
economic and business conditions, including those influenced by
U.S., international, and geopolitical events; environmental
responsibility, including with respect to cadmium telluride
(“CdTe”) and other semiconductor materials; claims under our
limited warranty obligations; changes in, or the failure to comply
with, government regulations and environmental, health, and safety
requirements; effects resulting from pending litigation, including
the class action lawsuit against us; future collection and
recycling costs for solar modules covered by our module collection
and recycling program; our ability to protect our intellectual
property; our ability to prevent and/or minimize the impact of
cyber-attacks or other breaches of our information systems; our
continued investment in research and development; the supply and
price of components and raw materials, including CdTe; our ability
to attract and retain key executive officers and associates; and
the matters discussed under the captions “Risk Factors” and
“Management’s Discussion and Analysis of Financial Conditions and
Results of Operations” of our most recent Annual Report on Form
10-K and our subsequently filed Quarterly Reports on Form 10-Q, as
supplemented by our other filings with the Securities and Exchange
Commission.
Contacts
First Solar
Investorsinvestor@firstsolar.com
First Solar
Mediamedia@firstsolar.com
FIRST SOLAR, INC. AND
SUBSIDIARIESCONSOLIDATED BALANCE
SHEETS(In thousands, except share
data)(Unaudited)
|
|
September 30, 2019 |
|
December 31, 2018 |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
878,999 |
|
|
$ |
1,403,562 |
|
Marketable securities |
|
661,552 |
|
|
1,143,704 |
|
Accounts receivable trade, net |
|
367,306 |
|
|
128,282 |
|
Accounts receivable, unbilled and retainage |
|
165,013 |
|
|
458,166 |
|
Inventories |
|
576,770 |
|
|
387,912 |
|
Balance of systems parts |
|
68,858 |
|
|
56,906 |
|
Project assets |
|
5,557 |
|
|
37,930 |
|
Prepaid expenses and other current assets |
|
319,435 |
|
|
243,061 |
|
Total current assets |
|
3,043,490 |
|
|
3,859,523 |
|
Property, plant and equipment,
net |
|
2,106,968 |
|
|
1,756,211 |
|
PV solar power systems,
net |
|
484,593 |
|
|
308,640 |
|
Project assets |
|
566,517 |
|
|
460,499 |
|
Deferred tax assets, net |
|
66,114 |
|
|
77,682 |
|
Restricted cash and
investments |
|
305,469 |
|
|
318,390 |
|
Goodwill |
|
14,462 |
|
|
14,462 |
|
Intangible assets, net |
|
66,785 |
|
|
74,162 |
|
Inventories |
|
152,574 |
|
|
130,083 |
|
Notes receivable,
affiliate |
|
— |
|
|
22,832 |
|
Other assets |
|
247,715 |
|
|
98,878 |
|
Total assets |
|
$ |
7,054,687 |
|
|
$ |
7,121,362 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
218,088 |
|
|
$ |
233,287 |
|
Income taxes payable |
|
15,409 |
|
|
20,885 |
|
Accrued expenses |
|
377,364 |
|
|
441,580 |
|
Current portion of long-term debt |
|
28,240 |
|
|
5,570 |
|
Deferred revenue |
|
93,283 |
|
|
129,755 |
|
Other current liabilities |
|
28,422 |
|
|
14,380 |
|
Total current liabilities |
|
760,806 |
|
|
845,457 |
|
Accrued solar module
collection and recycling liability |
|
134,985 |
|
|
134,442 |
|
Long-term debt |
|
452,064 |
|
|
461,221 |
|
Other liabilities |
|
524,349 |
|
|
467,839 |
|
Total liabilities |
|
1,872,204 |
|
|
1,908,959 |
|
Commitments and
contingencies |
|
|
|
|
Stockholders’ equity: |
|
|
|
|
Common stock, $0.001 par value per share; 500,000,000 shares
authorized; 105,406,367 and 104,885,261 shares issued and
outstanding at September 30, 2019 and December 31, 2018,
respectively |
|
105 |
|
|
105 |
|
Additional paid-in capital |
|
2,835,868 |
|
|
2,825,211 |
|
Accumulated earnings |
|
2,386,028 |
|
|
2,441,553 |
|
Accumulated other comprehensive loss |
|
(39,518 |
) |
|
(54,466 |
) |
Total stockholders’ equity |
|
5,182,483 |
|
|
5,212,403 |
|
Total liabilities and stockholders’ equity |
|
$ |
7,054,687 |
|
|
$ |
7,121,362 |
|
FIRST SOLAR, INC. AND
SUBSIDIARIESCONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except per share
amounts)(Unaudited)
|
|
Three Months Ended |
|
Nine Months Ended |
|
|
September 30, 2019 |
|
June 30, 2019 |
|
September 30, 2018 |
|
September 30, 2019 |
|
September 30, 2018 |
Net sales |
|
$ |
546,806 |
|
|
$ |
584,956 |
|
|
$ |
676,220 |
|
|
$ |
1,663,740 |
|
|
$ |
1,552,803 |
|
Cost of sales |
|
408,443 |
|
|
507,774 |
|
|
547,093 |
|
|
1,448,083 |
|
|
1,258,936 |
|
Gross profit |
|
138,363 |
|
|
77,182 |
|
|
129,127 |
|
|
215,657 |
|
|
293,867 |
|
Operating expenses: |
|
|
|
|
|
|
|
|
|
|
Selling, general and administrative |
|
53,542 |
|
|
50,934 |
|
|
33,539 |
|
|
149,828 |
|
|
125,519 |
|
Research and development |
|
24,912 |
|
|
24,395 |
|
|
22,390 |
|
|
71,184 |
|
|
63,084 |
|
Production start-up |
|
18,605 |
|
|
10,437 |
|
|
14,723 |
|
|
38,564 |
|
|
76,159 |
|
Total operating expenses |
|
97,059 |
|
|
85,766 |
|
|
70,652 |
|
|
259,576 |
|
|
264,762 |
|
Operating income (loss) |
|
41,304 |
|
|
(8,584 |
) |
|
58,475 |
|
|
(43,919 |
) |
|
29,105 |
|
Foreign currency gain (loss),
net |
|
1,209 |
|
|
1,726 |
|
|
(2,383 |
) |
|
3,107 |
|
|
(2,478 |
) |
Interest income |
|
11,454 |
|
|
13,510 |
|
|
16,456 |
|
|
39,223 |
|
|
45,145 |
|
Interest expense, net |
|
(4,976 |
) |
|
(8,921 |
) |
|
(3,198 |
) |
|
(24,018 |
) |
|
(14,445 |
) |
Other (loss) income, net |
|
(3,399 |
) |
|
(4,438 |
) |
|
(5,971 |
) |
|
(4,328 |
) |
|
7,635 |
|
Income (loss) before taxes and
equity in earnings |
|
45,592 |
|
|
(6,707 |
) |
|
63,379 |
|
|
(29,935 |
) |
|
64,962 |
|
Income tax expense |
|
(15,035 |
) |
|
(11,744 |
) |
|
(2,396 |
) |
|
(25,385 |
) |
|
(7,857 |
) |
Equity in earnings, net of
tax |
|
65 |
|
|
(97 |
) |
|
(3,233 |
) |
|
(205 |
) |
|
35,105 |
|
Net income (loss) |
|
$ |
30,622 |
|
|
$ |
(18,548 |
) |
|
$ |
57,750 |
|
|
$ |
(55,525 |
) |
|
$ |
92,210 |
|
|
|
|
|
|
|
|
|
|
|
|
Net income (loss) per
share: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
$ |
0.29 |
|
|
$ |
(0.18 |
) |
|
$ |
0.55 |
|
|
$ |
(0.53 |
) |
|
$ |
0.88 |
|
Diluted |
|
$ |
0.29 |
|
|
$ |
(0.18 |
) |
|
$ |
0.54 |
|
|
$ |
(0.53 |
) |
|
$ |
0.87 |
|
Weighted-average number of
shares used in per share calculations: |
|
|
|
|
|
|
|
|
|
|
Basic |
|
105,397 |
|
|
105,369 |
|
|
104,804 |
|
|
105,272 |
|
|
104,711 |
|
Diluted |
|
106,227 |
|
|
105,369 |
|
|
106,163 |
|
|
105,272 |
|
|
106,211 |
|
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