FSLR First Solar Inc

First Solar, Inc. (Nasdaq: FSLR) today announced financial results for the second quarter ended June 30, 2019. Net sales for the second quarter were $585 million, an increase of $53 million from the prior quarter, primarily due to increased module and system sales in the U.S. and Australia.

The Company reported a second quarter loss per share of $(0.18), compared to a loss per share of $(0.64) in the first quarter of 2019.

Cash, restricted cash and marketable securities at the end of the second quarter decreased to $2.1 billion from $2.3 billion at the end of the prior quarter, primarily as a result of continued capital investments in Series 6 manufacturing capacity.

“We continued to make significant progress in our Series 6 transition during Q2, with improvements across all manufacturing metrics,” said Mark Widmar, CEO of First Solar. “We had record module production and shipments during the second quarter, and with our recent bookings success we are now essentially sold out through 2020, with significant bookings visibility into 2021.”

2019 guidance has been updated as follows:

		2019 Guidance	Prior	Current
		Net Sales	$3.5B to $3.7B	Unchanged
		Gross Margin % (1)	18% to 19%	18.5% to 19.5%
		Operating Expenses (2)	$370M to $390M	$360M to $380M
		Operating Income	$260M to $310M	$290M to $340M
		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
(1)		Includes $60 to $70 million of ramp costs ($45 to $55 million previously)
(2)		Includes $55 to $65 million of production start-up expense ($70 to $80 million previously)
(3)		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, August 1, 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 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, August 8, 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 2308858. 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 to perform under their contracts with us; 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 SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
		June 30,				December 31,
		2019				2018
ASSETS
Current assets:
Cash and cash equivalents		$	1,221,568			$	1,403,562
Marketable securities		807,561				1,143,704
Accounts receivable trade, net		269,527				128,282
Accounts receivable, unbilled and retainage		127,972				458,166
Inventories		586,621				387,912
Balance of systems parts		91,728				56,906
Project assets		1,703				37,930
Prepaid expenses and other current assets		305,566				243,061
Total current assets		3,412,246				3,859,523
Property, plant and equipment, net		2,006,334				1,756,211
PV solar power systems, net		304,657				308,640
Project assets		528,246				460,499
Deferred tax assets, net		76,892				77,682
Restricted cash and investments		328,591				318,390
Goodwill		14,462				14,462
Intangible assets, net		69,119				74,162
Inventories		149,157				130,083
Notes receivable, affiliate		—				22,832
Other assets		248,103				98,878
Total assets		$	7,137,807			$	7,121,362
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	242,541			$	233,287
Income taxes payable		15,293				20,885
Accrued expenses		421,595				441,580
Current portion of long-term debt		28,312				5,570
Deferred revenue		112,237				129,755
Other current liabilities		23,341				14,380
Total current liabilities		843,319				845,457
Accrued solar module collection and recycling liability		136,275				134,442
Long-term debt		452,976				461,221
Other liabilities		570,113				467,839
Total liabilities		2,002,683				1,908,959
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value per share; 500,000,000 shares authorized; 105,390,383 and 104,885,261 shares issued and outstanding at June 30, 2019 and December 31, 2018, respectively		105				105
Additional paid-in capital		2,826,533				2,825,211
Accumulated earnings		2,355,406				2,441,553
Accumulated other comprehensive loss		(46,920		)		(54,466		)
Total stockholders’ equity		5,135,124				5,212,403
Total liabilities and stockholders’ equity		$	7,137,807			$	7,121,362

FIRST SOLAR, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)
	Three Months Ended												Six Months Ended
	June 30,				March 31,				June 30,				June 30,				June 30,
	2019				2019				2018				2019				2018
Net sales	$	584,956			$	531,978			$	309,318			$	1,116,934			$	876,583
Cost of sales	507,774				531,866				317,376				1,039,640				711,843
Gross profit (loss)	77,182				112				(8,058		)		77,294				164,740
Operating expenses:
Selling, general and administrative	50,934				45,352				50,854				96,286				91,980
Research and development	24,395				21,877				20,370				46,272				40,694
Production start-up	10,437				9,522				24,352				19,959				61,436
Total operating expenses	85,766				76,751				95,576				162,517				194,110
Operating loss	(8,584		)		(76,639		)		(103,634		)		(85,223		)		(29,370		)
Foreign currency gain (loss), net	1,726				172				2,422				1,898				(95		)
Interest income	13,510				14,259				16,865				27,769				28,689
Interest expense, net	(8,921		)		(10,121		)		(6,065		)		(19,042		)		(11,247		)
Other (loss) income, net	(4,438		)		3,509				(4,328		)		(929		)		13,606
(Loss) income before taxes and equity in earnings	(6,707		)		(68,820		)		(94,740		)		(75,527		)		1,583
Income tax (expense) benefit	(11,744		)		1,394				6,164				(10,350		)		(5,461		)
Equity in earnings, net of tax	(97		)		(173		)		40,085				(270		)		38,338
Net (loss) income	$	(18,548	)		$	(67,599	)		$	(48,491	)		$	(86,147	)		$	34,460
Net (loss) income per share:
Basic	$	(0.18	)		$	(0.64	)		$	(0.46	)		$	(0.82	)		$	0.33
Diluted	$	(0.18	)		$	(0.64	)		$	(0.46	)		$	(0.82	)		$	0.32
Weighted-average number of shares used in per share calculations:
Basic	105,369				105,046				104,776				105,208				104,664
Diluted	105,369				105,046				104,776				105,208				106,234