First Solar, Inc. Announces Third Quarter 2019 Financial Results

Date : 10/24/2019 @ 8:05PM
Source : GlobeNewswire Inc.
Stock : First Solar Inc (FSLR)
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First Solar, Inc. Announces Third Quarter 2019 Financial Results

First Solar (NASDAQ:FSLR)
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3 Months : From Oct 2019 to Jan 2020

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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 GuidancePriorCurrent
Net Sales$3.5B to $3.7BUnchanged
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 $2.75Unchanged
Net Cash Balance (3)$1.7B to $1.9BUnchanged
Capital Expenditures$650M to $750MUnchanged
Shipments5.4GW to 5.6GWUnchanged

——————————

  1. Includes $70 to $80 million of ramp costs ($60 to $70 million previously)
  2. Includes $40 to $50 million of production start-up expense ($55 to $65 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, 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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