SHIHEZI, China, Nov. 12, 2019 /PRNewswire/ -- Daqo New Energy
Corp. (NYSE: DQ) ("Daqo New Energy", the "Company" or "we"), a
leading manufacturer of high-purity polysilicon for the global
solar PV industry, today announced its unaudited financial results
for the third quarter of 2019.
Third Quarter 2019 Financial and Operating Highlights
- Polysilicon production volume of 9,437
MT in Q3 2019, compared to 7,151
MT in Q2 2019
- Polysilicon sales volume of 9,238
MT in Q3 2019, compared to 7,130
MT in Q2 2019
- Polysilicon average total production cost(1) of
$6.97/kg in Q3 2019, compared to
$8.12/kg in Q2 2019
- Polysilicon average cash cost(1) of $5.85/kg in Q3 2019, compared to $6.65/kg in Q2 2019
- Polysilicon average selling price (ASP) was $8.99/kg in Q3 2019, compared to $9.10/kg in Q2 2019
- Revenue from continuing operations was $83.9 million in Q3 2019, compared to
$66.0 million in Q2 2019
- Gross profit from continuing operations was $18.1 million in Q3 2019, compared to
$8.6 million in Q2 2019. Gross margin
from continuing operations was 21.5% in Q3 2019, compared to 13.0%
in Q2 2019
- EBITDA (non-GAAP)(2) from continuing operations was
$19.7 million in Q3 2019, compared to
$10.2 million in Q2 2019. EBITDA
margin (non-GAAP)(2) from continuing operations was
23.5% in Q3 2019, compared to 15.5% in Q2 2019
- Adjusted net income (non-GAAP)(2) attributable to
Daqo New Energy shareholders was $9.5
million in Q3 2019, compared to $2.3
million in Q2 2019 and $4.3
million in Q3 2018.
- Adjusted earnings per basic American Depository Share (ADS)
(non-GAAP)(2) was $0.69 in
Q3 2019, compared to $0.17 in Q2
2019, and $0.33 in Q3 2018.
- Net income from continuing operations was $4.9 million in Q3 2019, compared to net loss
from continuing operations of $2.7
million in Q2 2019 and net income from continuing operations
of $4.2 million in Q3 2018.
- Net income from discontinued operations was $0.1 million in Q3 2019, compared to net income
from discontinued operations of $0.5
million in Q2 2019 and net loss from discontinued operations
of $22.4 million in Q3 2018.
- Net income attributable to Daqo New Energy shareholders was
$5.0 million in Q3 2019, compared to
net loss attributable to Daqo New Energy shareholders of
$2.2 million in Q2 2019 and net loss
attributable to Daqo New Energy shareholders of $18.3 million in Q3 2018.
- Earnings per basic ADS was $0.37
in Q3 2019, compared to loss per basic ADS of $0.16 in Q2 2019, and loss per basic ADS of
$1.39 in Q3 2018.
|
Three months
ended
|
US$
millions
except as indicated
otherwise
|
Sep 30,
2019
|
Jun 30,
2019
|
Sep 30,
2018
|
Revenues
|
83.9
|
66.0
|
67.4
|
Gross
profit
|
18.1
|
8.6
|
12.8
|
Gross
margin
|
21.5%
|
13.0%
|
19.1%
|
Income / (loss) from
operations
|
8.8
|
(0.4)
|
4.0
|
Net income / (loss)
from continuing operations
|
4.9
|
(2.7)
|
4.2
|
Income / (loss) from
discontinued operations,
net of tax
|
0.1
|
0.5
|
(22.4)
|
Adjusted net income
(non-GAAP)(2) attributable
to Daqo New Energy Corp. shareholders
|
9.5
|
2.3
|
4.3
|
Adjusted earnings per
basic ADS (non-GAAP)(2)
($ per ADS)
|
0.69
|
0.17
|
0.33
|
Net income / (loss)
attributable to Daqo New
Energy Corp. shareholders
|
5.0
|
(2.2)
|
(18.3)
|
Earnings / (loss) per
basic ADS ($ per ADS)
|
0.37
|
(0.16)
|
(1.39)
|
EBITDA
(non-GAAP)(2) from continuing
operations
|
19.7
|
10.2
|
14.8
|
EBITDA margin
(non-GAAP) (2) from continuing
operations
|
23.5%
|
15.5%
|
22.0%
|
Polysilicon sales
volume (MT)
|
9,238
|
7,130
|
6,199
|
Polysilicon average
total production cost
($/kg)(1)
|
6.97
|
8.12
|
8.94
|
Polysilicon average
cash cost (excl. dep'n)
($/kg)(1)
|
5.85
|
6.65
|
7.12
|
Notes:
|
(1) Production
cost and cash cost only refer to production in our Xinjiang
polysilicon facilities. Production cost is calculated by the
inventoriable costs relating to production of polysilicon in
Xinjiang divided by the production volume in the period indicated.
Cash cost is calculated by the inventoriable costs relating to
production of polysilicon excluding depreciation expense, divided
by the production volume in the period indicated.
|
(2) Daqo New Energy
provides EBITDA from continuing operations, EBITDA margin from
continuing operations, adjusted net income attributable to Daqo New
Energy Corp. shareholders and adjusted earnings per ADS on a
non-GAAP basis to provide supplemental information regarding its
financial performance. For more information on these non-GAAP
financial measures, please see the section captioned "Use of
Non-GAAP Financial Measures" and the tables captioned
"Reconciliation of non-GAAP financial measures to comparable US
GAAP measures" set forth at the end of this press
release.
|
Management Remarks
Mr. Longgen Zhang, CEO of Daqo New Energy, commented, "We had an
outstanding quarter in which we reached record-high production
volume of 9,437 MT while achieving
the lowest production cost in the Company's history of $6.97/kg. Our results for the quarter reflect the
full production capacity and cost structure that our original
35,000 MT facility is able to
generate. In mid-September, we successfully completed the
construction and installation of our new Phase 4A expansion project
and now are currently working to ramp up production of its
additional 35,000 MT of capacity. We
expect Phase 4A to reach full production capacity by the end of
2019, approximately three months ahead of schedule. With Phase 4A's
additional capacity quickly coming online, we expect production
volumes during the fourth quarter of 2019 to be approximately
14,000 to 15,000 MT. Our production
costs would be further reduced to approximately $6.5/kg upon Phase 4A running at full
capacity."
"We continue to enhance mono-grade product quality and are
optimizing our product portfolio towards it in order to maintain
higher ASPs. We sold approximately 86% of our products to
mono-wafer customers during the quarter. Once Phase 4A is fully
ramped up, we expect mono-grade products to account for
approximately 90% of our total production volumes. With our
downstream mono-wafer customers expected to rapidly expand their
capacities for next year, we believe this will lead to continued
increase in mono-grade polysilicon demand, which should lead to
improvement in the price of mono-grade polysilicon for next
year."
"During the first three quarters of 2019, China installed approximately 16 GW of new
solar PV projects, significantly below the market's expectations.
We believe the primary reason is the long-delayed announcement of a
subsidy policy which has rippled downwards, forcing many project
developers to postpone project completion dates and extend the time
needed for planning, preparation, permit applications, and
procurement. It is possible that many of the 22.8 GW of subsidized
projects, which were originally expected to be installed in the
fourth quarter of 2019, could be delayed to the first half of year
2020. Despite softening demand from China's downstream market, demand from
overseas markets remains robust and could possibly reach 85 GW this
year, a significant increase from approximately 60GW in 2018. With
the Chinese downstream market expected to rebound next year and
overseas demand continuing to grow, we believe global solar PV
demand could exceed 140GW in 2020, a significant acceleration when
compared to 2019."
"Solar energy is now one of the most competitive forms of energy
generation, even when compared with traditional fossil fuel in many
markets. When combined with efficient methods to store power, solar
energy has the potential to become a sustaining baseload power. As
the economics improve and governments pass more policies to tackle
climate change, we believe we are at the cusp of major changes in
the market which will create enormous opportunities for us over the
next several years. We are confident in our ability to navigate
this temporary downturn in the market and are ready to take
advantage of the recovery next year when the market will continue
advancing towards grid parity."
"As one of the lowest-cost polysilicon producers with the
highest standards for quality, we are among the very few
polysilicon manufacturers who are able to generate a profit in the
current challenging market environment. For the first three
quarters of this year, our net cash provided by operating
activities was approximately $100
million. Once Phase 4A is operating at full capacity, we
expect to make further improvements in product quality
and cost structure so as to enhance
our leadership position in the industry."
Outlook and guidance
The Company expects to produce approximately 14,000 to 15,000
MT of polysilicon during the fourth quarter of 2019 and sell
approximately 12,500 to 13,500 MT of polysilicon to external
customers during the fourth quarter of 2019.For the full year of
2019, the Company expects to produce approximately 39,300 to
40,300 MT of polysilicon, inclusive
of the impact of the Company's annual facility
maintenance.
This outlook reflects Daqo New Energy's current and preliminary
view as of the date of this press release and may be subject to
changes. The Company's ability to achieve these projections is
subject to risks and uncertainties. See "Safe Harbor Statement" at
the end of this press release.
Third Quarter 2019 Results
Revenues
Revenues were $83.9 million,
compared to $66.0 million in the
second quarter of 2019 and $67.4
million in the third quarter of 2018. The increase in
revenues was primarily due to higher polysilicon sales volumes
which were offset by slightly lower ASPs. In RMB-terms, the
Company's polysilicon ASPs during the third quarter of 2019 were
slightly higher than during the second quarter in 2019. In
USD-terms, the Company's polysilicon ASPs fell as a result of the
depreciation of the RMB against the USD.
Gross profit and margin
Gross profit was $18.1 million,
compared to $8.6 million in the
second quarter of 2019 and $12.8 million in the third quarter of 2018.
Gross margin was 21.5%, compared to 13.0% in the second quarter of
2019 and 19.1% in the third quarter of 2018. The increase in gross
margin was primarily due to lower production costs despite a slight
decrease in ASPs.
Selling, general and administrative expenses
Selling, general and administrative expenses were $8.2 million, compared to $7.8 million in the second quarter of 2019 and
$7.6 million in the third quarter of
2018. This quarter's SG&A expenses include $4.0 million of non-cash share-based compensation
costs related to the Company's share incentive plan. The increase
in SG&A was primarily due to an increase in shipping costs as a
result of higher sales volume.
Research and development expenses
Research and development (R&D) expenses were $1.2 million, compared to $1.5 million in the second quarter of 2019 and
$1.4 million in the third quarter of
2018. R&D activities during the quarter included efforts
and initiatives to reduce carbon and metal content in the
manufacturing system to improve polysilicon purity. Research and
development expenses could vary from period to period and reflect
R&D activities that took place during the quarter.
Income / (loss) from operations
As a result of the foregoing, income from operations was
$8.8 million, compared to loss from
operations of $0.4 million in the
second quarter of 2019 and income from operations of $4.0 million in the third quarter of 2018.
Interest expense
Interest expense was $2.6 million,
compared to $1.9 million in the
second quarter of 2019 and $2.1
million in the third quarter of 2018.
EBITDA
EBITDA from continuing operations was $19.7 million, compared to $10.2 million in the second quarter of 2019 and
$14.8 million in the third quarter of
2018. EBITDA margin was 23.5%, compared to 15.5% in the second
quarter of 2019 and 22.0% in the third quarter of 2018.
Income from discontinued operations, net of
tax
During the third quarter of 2018, the Company decided to
discontinue its solar wafer manufacturing operations. Net income
from discontinued operations was $0.1
million in the third quarter of 2019, compared to
$0.5 million in the second quarter of
2019 and net loss from discontinued operations of $22.4 million in the third quarter of 2018. Net
income from discontinued operations during the second and third
quarter in 2019 resulted from the disposal of fixed assets which
were impaired in 2018 and previous years.
Net income / (loss) attributable to Daqo New Energy Corp.
shareholders and earnings / (loss) per ADS
As a result of the aforementioned, net income attributable to
Daqo New Energy Corp. shareholders was $5.0
million in the third quarter of 2019, compared to net loss
attributable to Daqo New Energy Corp. shareholders of $2.2 million in the second quarter of 2019 and
$18.3 million in the third quarter of
2018.
Earnings per basic ADS of $0.37,
compared to loss per basic ADS of $0.16 in the second quarter of 2019, and
$1.39 in the third quarter of
2018.
Financial Condition
As of September 30, 2019, the
Company had $68.2 million in cash,
cash equivalents and restricted cash, compared to $79.6 million as of June
30, 2019 and $113.2 million as
of September 30, 2018. As of
September 30, 2019, the accounts
receivable balance was $0.1 million,
compared to $0.1 million as of
June 30, 2019 and $1 thousand as of September 30, 2018. As of September 30, 2019, the notes receivable balance
was $4.3 million, compared to
$9.4 million as of June 30, 2019 and $22.5
million as of September 30,
2018. As of September 30,
2019, total borrowings were $248.8
million, of which $163.5
million were long-term borrowings, compared to total
borrowings of $243.2 million,
including $151.5 million long-term
borrowings, as of June 30, 2019 and
total borrowings of $165.3 million,
including $119.4 million long-term
borrowings, as of September 30,
2018.
Cash Flows
For the nine months ended September 30,
2019, net cash provided by operating activities was
$101.6 million, compared to
$63.6 million in the same period of
2018.
For the nine months ended September 30,
2019, net cash used in investing activities was $202.3 million, compared to $99.9 million in the same period of 2018. The net
cash used in investing activities in 2019 and 2018 was primarily
related to the capital expenditures on Xinjiang Phase 3B and 4A polysilicon projects.
For the nine months ended September 30,
2019, net cash provided by financing activities was
$76.6 million, compared to net cash
used in financing activities of $84.3
million in the same period of 2018.
Use of Non-GAAP Financial Measures
To supplement Daqo New Energy's consolidated financial results
presented in accordance with United States Generally Accepted
Accounting Principles ("US GAAP"), the Company uses certain
non-GAAP financial measures that are adjusted for certain items
from the most directly comparable GAAP measures including earnings
before interest, taxes, depreciation and amortization ("EBITDA")
and EBITDA margin; adjusted net income attributable to Daqo New
Energy Corp. shareholders and adjusted earnings per basic and
diluted ADS. Our management believes that each of these non-GAAP
measures is useful to investors, enabling them to better assess
changes in key element of the Company's results of operations
across different reporting periods on a consistent basis,
independent of certain items as described below. Thus, our
management believes that, used in conjunction with US GAAP
financial measures, these non-GAAP financial measures provide
investors with meaningful supplemental information to assess the
Company's operating results in a manner that is focused on its
ongoing, core operating performance. Our management uses these
non-GAAP measures internally to assess the business, its financial
performance, current and historical results, as well as for
strategic decision-making and forecasting future results. Given our
management's use of these non-GAAP measures, the Company believes
these measures are important to investors in understanding the
Company's operating results as seen through the eyes of our
management. These non-GAAP measures are not prepared in accordance
with US GAAP or intended to be considered in isolation or as a
substitute for the financial information prepared and presented in
accordance with US GAAP; the non-GAAP measures should be reviewed
together with the US GAAP measures, and may be different from
non-GAAP measures used by other companies.
The Company uses EBITDA, which represents earnings before
interest, taxes, depreciation and amortization, and EBITDA margin,
which represents the proportion of EBITDA in revenues. Adjusted net
income attributable to Daqo New Energy Corp. shareholders and
adjusted earnings per basic and diluted ADS exclude costs related
to the non-operational polysilicon assets in Chongqing. Such costs mainly consist of
non-cash depreciation costs, as well as utilities and maintenance
costs associated with the temporarily idle polysilicon machinery
and equipment, and the Company had removed this adjustment from the
non-GAAP reconciling item since the fourth quarter of 2018, because
as of the end of the third quarter of 2018, all of the polysilicon
machinery and equipment had been either relocated to Xinjiang,
disposed, or planned to be disposed of in due course. Adjusted net
income attributable to Daqo New Energy Corp. shareholders and
adjusted earnings per basic and diluted ADS also exclude costs
related to share-based compensation. Share-based compensation is a
non-cash expense that varies from period to period. As a result,
our management excludes this item from our internal operating
forecasts and models. Our management believes that this adjustment
for share-based compensation provides investors with a basis to
measure the Company's core performance, including compared with the
performance of other companies, without the period-to-period
variability created by share-based compensation.
A reconciliation of non-GAAP financial measures to comparable US
GAAP measures is presented later in this document.
Conference Call
The Company has scheduled a conference call to discuss the
results at 8:00 AM Eastern Time on
November 12, 2019. (9:00 PM Beijing / Hong
Kong time on the same day).
The dial-in details for the live conference call are as
follows:
Participant dial in
(toll free):
|
+1-888-346-8982
|
Participant
international dial in:
|
+1-412-902-4272
|
China mainland toll
free:
|
4001-201203
|
China Beijing local
toll:
|
+86-105-357-3132
|
Hong Kong toll
free:
|
800-905945
|
Hong Kong-local
toll:
|
+852-301-84992
|
You can also listen to the conference call via Webcast through
the URL: https://services.choruscall.com/links/dq191112.html
A replay of the call will be available 1 hour after the end of
the conference through November 19,
2019.
The conference call replay numbers are as follows:
US Toll
Free:
|
+1-877-344-7529
|
International
Toll:
|
+1-412-317-0088
|
Canada Toll
Free:
|
855-669-9568
|
Replay access
code:
|
10136595
|
To access the replay using an international dial-in number,
please select the link below.
https://services.choruscall.com/ccforms/replay.html
Participants will be required to state their name and company
upon entering the call.
About Daqo New Energy Corp.
Daqo New Energy Corp. (NYSE: DQ) ("Daqo" or the "Company") is a
leading manufacturer of high-purity polysilicon for the global
solar PV industry. Founded in 2008, the Company is one of the
world's lowest cost producers of high-purity polysilicon. Daqo's
highly-efficient and technically advanced manufacturing facility in
Xinjiang, China currently has a
nameplate annual polysilicon production capacity of 70,000 metric
tons.
For more information, please visit http://ir.xjdqsolar.com/
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of 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. Among other things,
the outlook for the fourth quarter and the full year of 2019 and
quotations from management in this announcement, as well as Daqo
New Energy's strategic and operational plans, contain
forward-looking statements. The Company may also make written or
oral forward-looking statements in its reports filed or furnished
to the U.S. Securities and Exchange Commission, in its annual
reports to shareholders, in press releases and other written
materials and in oral statements made by its officers, directors or
employees to third parties. Statements that are not historical
facts, including statements about the Company's beliefs and
expectations, are forward-looking statements. Forward-looking
statements involve inherent risks and uncertainties. A number of
factors could cause actual results to differ materially from those
contained in any forward-looking statement, including but not
limited to the following: the demand for photovoltaic products and
the development of photovoltaic technologies; global supply and
demand for polysilicon; alternative technologies in cell
manufacturing; the Company's ability to significantly expand its
polysilicon production capacity and output; the reduction in or
elimination of government subsidies and economic incentives for
solar energy applications; and the Company's ability to lower its
production costs. Further information regarding these and other
risks is included in the reports or documents the Company has filed
with, or furnished to, the U.S. Securities and Exchange Commission.
All information provided in this press release is as of the date
hereof, and the Company undertakes no duty to update such
information or any forward-looking statement, except as required
under applicable law.
Daqo New Energy
Corp.
|
Unaudited
Condensed Consolidated Statement of Operations and Comprehensive
Income
|
(US dollars in
thousands, except ADS and per ADS data)
|
|
|
|
Three months
ended
|
|
Nine months
ended
|
|
|
Sep 30,
2019
|
|
Jun 30,
2019
|
|
Sep 30,
2018
|
|
Sep 30,
2019
|
|
Sep 30,
2018
|
|
|
|
|
|
|
|
|
|
|
|
Revenues
|
|
$83,909
|
|
$65,959
|
|
$67,390
|
|
$231,072
|
|
$225,997
|
Cost of
revenues
|
|
(65,834)
|
|
(57,390)
|
|
(54,543)
|
|
(186,087)
|
|
(144,821)
|
Gross
profit
|
|
18,075
|
|
8,569
|
|
12,847
|
|
44,985
|
|
81,176
|
Operating
expenses
|
|
|
|
|
|
|
|
|
|
|
Selling, general and
administrative
expenses
|
|
(8,178)
|
|
(7,806)
|
|
(7,567)
|
|
(23,920)
|
|
(18,837)
|
Research and
development expenses
|
|
(1,228)
|
|
(1,527)
|
|
(1,437)
|
|
(4,052)
|
|
(1,767)
|
Other operating
income
|
|
145
|
|
365
|
|
138
|
|
579
|
|
650
|
Total operating
expenses
|
|
(9,261)
|
|
(8,968)
|
|
(8,866)
|
|
(27,393)
|
|
(19,954)
|
Income / (loss) from
operations
|
|
8,814
|
|
(399)
|
|
3,981
|
|
17,592
|
|
61,222
|
Interest
expense
|
|
(2,551)
|
|
(1,889)
|
|
(2,126)
|
|
(6,461)
|
|
(8,872)
|
Interest
income
|
|
193
|
|
258
|
|
276
|
|
775
|
|
795
|
Foreign exchange gain
(loss)
|
|
-
|
|
(1)
|
|
1,937
|
|
(189)
|
|
1,938
|
Income / (loss)
before income taxes
|
|
6,456
|
|
(2,031)
|
|
4,068
|
|
11,717
|
|
55,083
|
Income tax (expense)
/ benefit
|
|
(1,561)
|
|
(662)
|
|
87
|
|
(3,652)
|
|
(10,154)
|
Net income /
(loss)from continuing operations
|
|
4,895
|
|
(2,693)
|
|
4,155
|
|
8,065
|
|
44,929
|
Net income / (loss)
from discontinued
operations, net of tax
|
|
88
|
|
504
|
|
(22,410)
|
|
1,370
|
|
(17,612)
|
Net income /
(loss)
|
|
4,983
|
|
(2,189)
|
|
(18,255)
|
|
9,435
|
|
27,317
|
Net income
attributable to non-controlling
interest
|
|
-
|
|
-
|
|
41
|
|
-
|
|
575
|
Net income / (loss)
attributable to Daqo
New Energy Corp.
shareholders
|
|
$4,983
|
|
$(2,189)
|
|
$(18,296)
|
|
$9,435
|
|
$26,742
|
|
|
|
|
|
|
|
|
|
|
|
Net income /
(loss)
|
|
4,983
|
|
(2,189)
|
|
(18,255)
|
|
9,435
|
|
27,317
|
Other comprehensive
(loss)/ income:
|
|
|
|
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
(21,337)
|
|
(12,271)
|
|
(18,706)
|
|
(20,594)
|
|
(27,291)
|
Total other
comprehensive loss
|
|
(21,337)
|
|
(12,271)
|
|
(18,706)
|
|
(20,594)
|
|
(27,291)
|
Comprehensive
(loss)/income
|
|
(16,354)
|
|
(14,460)
|
|
(36,961)
|
|
(11,159)
|
|
26
|
Comprehensive income
/ (loss)
attributable to non-controlling
interest
|
|
-
|
|
-
|
|
(34)
|
|
-
|
|
432
|
Comprehensive loss
attributable to Daqo
New Energy Corp. shareholders
|
|
$(16,354)
|
|
$(14,460)
|
|
$(36,927)
|
|
$(11,159)
|
|
$(406)
|
|
|
|
|
|
|
|
|
|
|
|
Earnings /
(loss) per ADS
|
|
|
|
|
|
|
|
|
|
|
- continuing
operations
|
|
0.36
|
|
(0.20)
|
|
0.32
|
|
0.60
|
|
3.63
|
- discontinued
operations
|
|
0.01
|
|
0.04
|
|
(1.71)
|
|
0.10
|
|
(1.44)
|
Basic
|
|
0.37
|
|
(0.16)
|
|
(1.39)
|
|
0.70
|
|
2.19
|
|
|
|
|
|
|
|
|
|
|
|
- continuing
operations
|
|
0.34
|
|
(0.20)
|
|
0.31
|
|
0.59
|
|
3.45
|
- discontinued
operations
|
|
0.01
|
|
0.04
|
|
(1.67)
|
|
0.10
|
|
(1.37)
|
Diluted
|
|
0.35
|
|
(0.16)
|
|
(1.36)
|
|
0.69
|
|
2.08
|
Weighted average ADS
outstanding
|
|
|
|
|
|
|
|
|
|
|
Basic
|
|
13,634,401
|
|
13,492,010
|
|
13,122,403
|
|
13,496,614
|
|
12,208,626
|
Diluted
|
|
14,219,008
|
|
13,936,671
|
|
13,444,935
|
|
13,751,923
|
|
12,829,410
|
Daqo New Energy
Corp.
|
Unaudited
Consolidated Balance Sheets
|
(US dollars in
thousands)
|
|
|
|
Sep 30,
2019
|
|
Jun 30,
2019
|
|
Sep 30,
2018
|
|
|
|
|
|
|
|
ASSETS:
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$26,985
|
|
$31,250
|
|
$110,322
|
Restricted
cash
|
|
41,192
|
|
48,375
|
|
2,913
|
Short-term
investment
|
|
-
|
|
-
|
|
14,561
|
Accounts receivable,
net
|
|
129
|
|
86
|
|
1
|
Notes
receivable
|
|
4,294
|
|
9,435
|
|
22,500
|
Prepaid expenses and
other current assets
|
|
24,176
|
|
13,765
|
|
9,029
|
Advances to
suppliers
|
|
7,823
|
|
8,688
|
|
2,225
|
Inventories
|
|
21,023
|
|
19,871
|
|
17,021
|
Amount due from related
parties
|
|
3,492
|
|
4,572
|
|
4,560
|
Current assets
associated with discontinued
operation
|
|
414
|
|
1,133
|
|
9,641
|
Total current
assets
|
|
129,528
|
|
137,175
|
|
192,773
|
Property, plant and
equipment, net
|
|
883,084
|
|
763,388
|
|
536,131
|
Prepaid land use
right
|
|
21,030
|
|
22,029
|
|
22,415
|
Deferred tax
assets
|
|
790
|
|
823
|
|
676
|
Long-term equity
investments
|
|
625
|
|
651
|
|
651
|
Operating lease
right-of-use assets
|
|
211
|
|
158
|
|
-
|
Non-current asset
associated with discontinued
operation
|
|
6,804
|
|
55,175
|
|
62,454
|
TOTAL
ASSETS
|
|
1,042,072
|
|
979,399
|
|
815,100
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
Short-term borrowings,
including current portion of
long-term borrowings
|
|
85,278
|
|
91,760
|
|
45,867
|
Accounts
payable
|
|
20,070
|
|
11,106
|
|
9,580
|
Notes
payable
|
|
62,287
|
|
73,135
|
|
5,237
|
Advances from customers
- short term portion
|
|
21,218
|
|
25,654
|
|
16,380
|
Payables for purchases
of property, plant and
equipment
|
|
81,709
|
|
25,213
|
|
39,097
|
Accrued expenses and
other current liabilities
|
|
12,071
|
|
9,340
|
|
8,356
|
Amount due to related
parties
|
|
16,787
|
|
683
|
|
1,925
|
Income tax
payable
|
|
3,437
|
|
1,975
|
|
3,821
|
Lease liabilities-short
term portion
|
|
81
|
|
115
|
|
-
|
Current liabilities
associated with discontinued
operation
|
|
1,087
|
|
6,879
|
|
23,228
|
Total current
liabilities
|
|
304,025
|
|
245,860
|
|
153,491
|
Long-term
borrowings
|
|
163,519
|
|
151,475
|
|
119,399
|
Advance from customers
– long-term portion
|
|
9,092
|
|
3,496
|
|
9,028
|
Amount due to related
parties – long-term portion
|
|
15,387
|
|
16,022
|
|
-
|
Other long-term
liabilities
|
|
20,876
|
|
21,213
|
|
21,642
|
Deferred tax
liabilities
|
|
1,145
|
|
1,159
|
|
-
|
Lease liabilities –
long-term portion
|
|
74
|
|
58
|
|
-
|
Non-current liabilities
associated with discontinued
operation
|
|
-
|
|
702
|
|
744
|
TOTAL
LIABILITIES
|
|
514,118
|
|
439,985
|
|
304,304
|
EQUITY:
|
|
|
|
|
|
|
Ordinary
shares
|
|
35
|
|
34
|
|
33
|
Treasury
stock
|
|
(1,749)
|
|
(1,749)
|
|
(1,749)
|
Additional paid-in
capital
|
|
382,660
|
|
377,767
|
|
363,312
|
Retained
earnings
|
|
180,834
|
|
175,851
|
|
160,017
|
Accumulated other
comprehensive loss
|
|
(33,826)
|
|
(12,489)
|
|
(14,041)
|
Total Daqo New Energy
Corp.'s shareholders' equity
|
|
527,954
|
|
539,414
|
|
507,572
|
Non-controlling
interest
|
|
-
|
|
-
|
|
3,224
|
Total
equity
|
|
527,954
|
|
539,414
|
|
510,796
|
TOTAL LIABILITIES
& EQUITY
|
|
1,042,072
|
|
979,399
|
|
815,100
|
Daqo New Energy
Corp.
|
Unaudited
Consolidated Statements of Cash Flows
|
(US dollars in
thousands)
|
|
|
For the nine months
ended
|
|
|
Sep 30,
2019
|
|
Sep 30,
2018
|
Operating
Activities:
|
|
|
|
|
Net income
|
|
9,435
|
|
27,317
|
Less: Income / (loss)
from discontinued operations, net of tax
|
|
1,370
|
|
(17,612)
|
Net income from
continuing operations
|
|
8,065
|
|
44,929
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
Share-based compensation
|
|
13,436
|
|
9,510
|
Inventory write-down
|
|
247
|
|
-
|
Depreciation of property, plant and equipment
|
|
32,101
|
|
20,368
|
Depreciation of operating lease right-of-use
assets
|
|
30
|
|
-
|
|
|
|
|
|
Changes in
operating assets and liabilities:
|
|
|
|
|
Accounts
receivable
|
|
1,049
|
|
699
|
Notes receivable
|
|
3,658
|
|
(2,973)
|
Prepaid expenses and other current assets
|
|
(14,427)
|
|
(3,417)
|
Advances to suppliers
|
|
(4,816)
|
|
(773)
|
Inventories
|
|
(6,665)
|
|
(4,000)
|
Prepaid land use rights
|
|
393
|
|
414
|
Operating lease right-of-use assets
|
|
(251)
|
|
-
|
Accounts payable
|
|
11,697
|
|
(9,201)
|
Notes payable
|
|
40,035
|
|
(11,286)
|
Accrued expenses and other current liabilities
|
|
3,023
|
|
(2,001)
|
Income tax payable
|
|
(1,888)
|
|
(9,159)
|
Advances from customers
|
|
14,059
|
|
10,445
|
Amount due to related parties
|
|
(15)
|
|
5,566
|
Deferred tax liabilities
|
|
5
|
|
-
|
Deferred government subsidies
|
|
(431)
|
|
(461)
|
Lease liabilities
|
|
162
|
|
-
|
Net cash provided by
operating activities-continuing operations
|
|
99,467
|
|
48,660
|
Net cash provided by
operation activities-discontinued operations
|
|
2,138
|
|
14,939
|
Net cash provided by
operating activities
|
|
101,605
|
|
63,599
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
Purchases of property,
plant and equipment
|
|
(226,567)
|
|
(74,774)
|
Withdraw/ (Purchase)
of short-term investment
|
|
21,869
|
|
(15,373)
|
Acquisition of
Xinjiang Daqo Investment
|
|
631
|
|
-
|
Net cash used in
investing activities-continuing operations
|
|
(204,067)
|
|
(90,147)
|
Net cash provided by/
(used in) investing activities-discontinued operations
|
|
1,791
|
|
(9,783)
|
Net cash used in
investing activities
|
|
(202,276)
|
|
(99,930)
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
Proceeds from related
parties loans
|
|
20,522
|
|
35,358
|
Repayment of related
parties loans
|
|
(20,522)
|
|
(35,358)
|
Proceeds from bank
borrowings
|
|
146,614
|
|
27,979
|
Repayment of bank
borrowings
|
|
(59,307)
|
|
(38,741)
|
Proceeds from exercise
of options
|
|
138
|
|
685
|
Proceeds from
follow-on offering
|
|
-
|
|
113,541
|
Issuance
cost
|
|
-
|
|
(6,919)
|
Net cash provided by
financing activities – continuing operations
|
|
87,445
|
|
96,545
|
Net cash used in
financing activities – discontinued operations
|
|
(10,843)
|
|
(12,271)
|
Net cash provided by
financing activities
|
|
76,602
|
|
84,274
|
|
|
|
|
|
Effect of exchange
rate changes
|
|
(2,582)
|
|
(5,636)
|
Net (decrease)/
increase in cash, cash equivalents and restricted cash
|
|
(26,651)
|
|
42,307
|
Cash, cash
equivalents and restricted cash at the beginning of the
period
|
|
95,120
|
|
72,667
|
Cash, cash
equivalents and restricted cash at the end of the period
|
|
68,469
|
|
114,974
|
|
|
The following table
provides a reconciliation of cash, cash equivalents, and restricted
cash reported within the statement of financial
position that sum to the total of the same such amounts shown in
the statement of cash flows.
|
|
|
|
Sep 30,
2019
|
|
Sep 30,
2018
|
Cash and cash
equivalents
|
|
27,277
|
|
111,956
|
Restricted
cash
|
|
41,192
|
|
3,018
|
Total cash, cash
equivalents, and restricted cash shown in the statement of
cash flows
|
|
68,469
|
|
114,974
|
Daqo New Energy
Corp.
|
Reconciliation of
non-GAAP financial measures to comparable US GAAP
measures
|
(US dollars in
thousands)
|
|
|
Three months
Ended
|
Nine months
Ended
|
|
|
Sep 30,
2019
|
|
Jun 30,
2019
|
|
Sep 30,
2018
|
|
Sep 30,
2019
|
|
Sep 30,
2018
|
Net income /
(loss) from continuing
operation
|
|
4,895
|
|
(2,693)
|
|
4,155
|
|
8,065
|
|
44,929
|
Income tax
expense
|
|
1,561
|
|
662
|
|
(87)
|
|
3,652
|
|
10,154
|
Interest
expense
|
|
2,551
|
|
1,889
|
|
2,126
|
|
6,461
|
|
8,872
|
Interest
income
|
|
(193)
|
|
(258)
|
|
(276)
|
|
(775)
|
|
(795)
|
Depreciation &
Amortization
|
|
10,878
|
|
10,637
|
|
8,891
|
|
32,524
|
|
27,679
|
EBITDA from continuing
operation (non-
GAAP)
|
|
19,692
|
|
10,237
|
|
14,809
|
|
49,927
|
|
90,839
|
EBITDA
margin from continuing operation
(non-GAAP)
|
|
23.5%
|
|
15.5%
|
|
22.0%
|
|
21.6%
|
|
40.2%
|
|
|
|
Three months
Ended
|
Nine months
Ended
|
|
|
Sep 30,
2019
|
|
Jun 30,
2019
|
|
Sep 30,
2018
|
|
Sep 30,
2019
|
|
Sep
30,
2018
|
Net income /
(loss) attributable to Daqo
New Energy Corp.
shareholders
|
|
4,983
|
|
(2,189)
|
|
(18,296)
|
|
9,435
|
|
26,742
|
Share-based
compensation
|
|
4,476
|
|
4,486
|
|
4,267
|
|
13,436
|
|
9,510
|
Costs related to the
Chongqing polysilicon operations
|
|
-
|
|
-
|
|
128
|
|
-
|
|
968
|
Impairment of
long-lived assets
|
|
-
|
|
-
|
|
18,221
|
|
-
|
|
18,221
|
Adjusted net
income (non-GAAP)
attributable to Daqo New Energy Corp.
shareholders
|
|
9,459
|
|
2,297
|
|
4,320
|
|
22,871
|
|
55,441
|
Adjusted earnings
per basic ADS (non-
GAAP)
|
|
0.69
|
|
0.17
|
|
0.33
|
|
1.69
|
|
4.54
|
Adjusted earnings
per diluted ADS
(non-GAAP)
|
|
0.67
|
|
0.16
|
|
0.32
|
|
1.66
|
|
4.32
|
For further information, please contact:
Daqo New Energy Corp.
Investor Relations Department
Phone: +86-187-1658-5553
Email: dqir@daqo.com
Christensen
In China
Mr. Christian Arnell
Phone: +86-10- 5900-1548
E-mail: carnell@christensenir.com
In US
Mr. Tip Fleming
Phone: +1-917-412-3333
Email: tfleming@Christensenir.com
For more information about Daqo New Energy, please visit
http://www.dqsolar.com
View original
content:http://www.prnewswire.com/news-releases/daqo-new-energy-announces-unaudited-third-quarter-2019-results-300956228.html
SOURCE Daqo New Energy Corp.