First Solar, Inc. (Nasdaq: FSLR) today announced financial results
for the first quarter ended March 31, 2020 and provided an update
on its response to the COVID-19 pandemic. During the first quarter
of 2020, the Company responded to the COVID-19 global health
crisis, swiftly implementing measures designed to protect the
well-being of its associates and to ensure that its technology is
safely manufactured and delivered to its customers.
“In meeting the clean energy needs of the global
economy, we will continue to balance our top priority of safety
with delivering value to each of our stakeholders,” said Mark
Widmar, CEO of First Solar.
“We recognize the challenges that our associates
and their families are facing in these uncertain times, and are
very proud of the dedication, focus, and commitment that we have
witnessed from each First Solar associate over the past two months.
It is during challenging times like these that our culture of
agility, collaboration, and accountability shines through.”
“Despite the uncertain economic environment,
demand for our Series 6 product remains strong, as evidenced by the
1.1 GWDC of net-bookings since our prior earnings call. We continue
to meet this demand with well-coordinated operational execution
from our diverse Series 6 manufacturing footprint in Ohio,
Malaysia, and Vietnam.”
Net sales for the first quarter were $532
million, a decrease of $867 million from the prior quarter,
primarily due to lower systems revenue from U.S. project sales
during the quarter and record module shipments during the fourth
quarter of 2019.
The Company reported first quarter net income
per share of $0.85, compared to a net loss per share of $(0.56) in
the fourth quarter of 2019.
Cash, restricted cash, and marketable securities
at the end of the first quarter decreased to $1.6 billion from $2.3
billion at the end of the prior quarter, primarily due to the
payment of the class action litigation settlement, Series 6 capital
expenditures (which were primarily related to the second Series 6
factory in Malaysia), a decrease in deferred revenue associated
with ITC safe harbor module purchase orders, and prepayment for
components included in the module bill of materials.
Withdrawing Previous Full-Year 2020
Financial and Operational Guidance
As of the date of this release, the Company and
its financial results have not been materially impacted by
COVID-19. However, given the significant uncertainty regarding the
severity and duration of the COVID-19 pandemic and its impact on
the Company’s operations and financial results, as well as on
energy and capital markets, the Company is withdrawing its
full-year 2020 guidance.
Updated Full-Year 2020 Module
Production, Operating Expenses, and Capital Expenditure
Guidance
The Company is providing limited guidance that
it believes is largely within its control at this time.
- Module production: 5.9 GWDC, including 5.7
GWDC of Series 6 and 0.2 GWDC of Series 4
- Operating expenses: $340 to $360 million
(including $50 to $60 million of start-up expenses)
- Capital expenditures: $450 to $550
million
Conference Call Details
First Solar has scheduled a conference call for
today, May 7, 2020 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.
Investors are encouraged to listen to the
conference call and to review the accompanying materials, which
contain more information about First Solar’s first quarter
financial results and financial outlook.
An audio replay of the conference call will be
available through Thursday, May 14, 2020 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 1286184. 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 90 days.
About First Solar, Inc.
First Solar is a leading global provider of
comprehensive photovoltaic (“PV”) solar solutions, 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:
net sales, gross margin, operating expenses, operating income,
earnings per share, loss per share, net cash balance, capital
expenditures, shipments, bookings, production, products and our
business and financial objectives for 2020. 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: the severity and
duration of the COVID-19 pandemic, including its potential
impact on our business, results of operations, and financial
condition; 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 off-take counterparties and
the ability of our off-take 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 opt-out action 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 Condition 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. You should carefully consider the risks and
uncertainties described in these reports.
Contacts
First Solar
Investorsinvestor@firstsolar.com
First Solar
Mediamedia@firstsolar.com
FIRST SOLAR,
INC.CONSOLIDATED BALANCE
SHEETS(In thousands, except share
data)(Unaudited)
|
|
March 31, 2020 |
|
December 31, 2019 |
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and cash equivalents |
|
$ |
929,355 |
|
|
$ |
1,352,741 |
|
Marketable securities (amortized cost of $586,628 and allowance for
credit losses of $215 at March 31, 2020) |
|
579,340 |
|
|
811,506 |
|
Accounts receivable trade |
|
293,612 |
|
|
476,425 |
|
Less: allowance for credit losses |
|
(3,331 |
) |
|
(1,386 |
) |
Accounts receivable trade, net |
|
290,281 |
|
|
475,039 |
|
Accounts receivable, unbilled and retainage |
|
122,332 |
|
|
183,473 |
|
Less: allowance for credit losses |
|
(1,223 |
) |
|
— |
|
Accounts receivable, unbilled and retainage, net |
|
121,109 |
|
|
183,473 |
|
Inventories |
|
479,792 |
|
|
443,513 |
|
Balance of systems parts |
|
44,718 |
|
|
53,583 |
|
Project assets |
|
403 |
|
|
3,524 |
|
Prepaid expenses and other current assets |
|
302,845 |
|
|
276,455 |
|
Total current assets |
|
2,747,843 |
|
|
3,599,834 |
|
Property, plant and equipment,
net |
|
2,244,175 |
|
|
2,181,149 |
|
PV solar power systems,
net |
|
470,709 |
|
|
476,977 |
|
Project assets |
|
388,511 |
|
|
333,596 |
|
Deferred tax assets, net |
|
213,600 |
|
|
130,771 |
|
Restricted marketable
securities (amortized cost of $242,156 and allowance for credit
losses of $30 at March 31, 2020) |
|
246,410 |
|
|
223,785 |
|
Goodwill |
|
14,462 |
|
|
14,462 |
|
Intangible assets, net |
|
63,918 |
|
|
64,543 |
|
Inventories |
|
182,259 |
|
|
160,646 |
|
Other assets |
|
377,254 |
|
|
329,926 |
|
Total assets |
|
$ |
6,949,141 |
|
|
$ |
7,515,689 |
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Current liabilities: |
|
|
|
|
Accounts payable |
|
$ |
173,762 |
|
|
$ |
218,081 |
|
Income taxes payable |
|
8,287 |
|
|
17,010 |
|
Accrued expenses |
|
296,796 |
|
|
351,260 |
|
Current portion of long-term debt |
|
81,807 |
|
|
17,510 |
|
Deferred revenue |
|
136,998 |
|
|
323,217 |
|
Accrued litigation |
|
13,000 |
|
|
363,000 |
|
Other current liabilities |
|
21,785 |
|
|
28,130 |
|
Total current liabilities |
|
732,435 |
|
|
1,318,208 |
|
Accrued solar module
collection and recycling liability |
|
138,009 |
|
|
137,761 |
|
Long-term debt |
|
390,588 |
|
|
454,187 |
|
Other liabilities |
|
519,487 |
|
|
508,766 |
|
Total liabilities |
|
1,780,519 |
|
|
2,418,922 |
|
Commitments and
contingencies |
|
|
|
|
Stockholders’ equity: |
|
|
|
|
Common stock, $0.001 par value per share; 500,000,000 shares
authorized; 105,905,580 and 105,448,921 shares issued and
outstanding at March 31, 2020 and December 31, 2019,
respectively |
|
106 |
|
|
105 |
|
Additional paid-in capital |
|
2,844,055 |
|
|
2,849,376 |
|
Accumulated earnings |
|
2,408,111 |
|
|
2,326,620 |
|
Accumulated other comprehensive loss |
|
(83,650 |
) |
|
(79,334 |
) |
Total stockholders’ equity |
|
5,168,622 |
|
|
5,096,767 |
|
Total liabilities and stockholders’ equity |
|
$ |
6,949,141 |
|
|
$ |
7,515,689 |
|
FIRST SOLAR,
INC.CONSOLIDATED STATEMENTS OF
OPERATIONS(In thousands, except per share
amounts)(Unaudited)
|
|
Three Months Ended |
|
|
March 31, 2020 |
|
December 31, 2019 |
|
March 31, 2019 |
Net sales |
|
$ |
532,124 |
|
|
$ |
1,399,377 |
|
|
$ |
531,978 |
|
Cost of sales |
|
441,786 |
|
|
1,065,822 |
|
|
531,866 |
|
Gross profit |
|
90,338 |
|
|
333,555 |
|
|
112 |
|
Operating expenses: |
|
|
|
|
|
|
Selling, general and administrative |
|
58,587 |
|
|
55,643 |
|
|
45,352 |
|
Research and development |
|
25,613 |
|
|
25,427 |
|
|
21,877 |
|
Production start-up |
|
4,482 |
|
|
7,351 |
|
|
9,522 |
|
Litigation loss |
|
— |
|
|
363,000 |
|
|
— |
|
Total operating expenses |
|
88,682 |
|
|
451,421 |
|
|
76,751 |
|
Operating income (loss) |
|
1,656 |
|
|
(117,866 |
) |
|
(76,639 |
) |
Foreign currency (loss)
income, net |
|
(398 |
) |
|
(816 |
) |
|
172 |
|
Interest income |
|
9,330 |
|
|
9,663 |
|
|
14,259 |
|
Interest expense, net |
|
(6,789 |
) |
|
(3,048 |
) |
|
(10,121 |
) |
Other (expense) income,
net |
|
(2,222 |
) |
|
21,873 |
|
|
3,509 |
|
Income (loss) before taxes and equity in earnings |
|
1,577 |
|
|
(90,194 |
) |
|
(68,820 |
) |
Income tax benefit |
|
89,215 |
|
|
30,865 |
|
|
1,394 |
|
Equity in earnings, net of
tax |
|
(88 |
) |
|
(79 |
) |
|
(173 |
) |
Net income (loss) |
|
$ |
90,704 |
|
|
$ |
(59,408 |
) |
|
$ |
(67,599 |
) |
|
|
|
|
|
|
|
Net income (loss) per
share: |
|
|
|
|
|
|
Basic |
|
$ |
0.86 |
|
|
$ |
(0.56 |
) |
|
$ |
(0.64 |
) |
Diluted |
|
$ |
0.85 |
|
|
$ |
(0.56 |
) |
|
$ |
(0.64 |
) |
Weighted-average number of
shares used in per share calculations: |
|
|
|
|
|
|
Basic |
|
105,595 |
|
|
105,425 |
|
|
105,046 |
|
Diluted |
|
106,386 |
|
|
105,425 |
|
|
105,046 |
|
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