PR Newswire
XINYU CITY, China and SUNNYVALE, Calif., Aug. 29, 2011
XINYU CITY, China and SUNNYVALE, Calif., Aug. 29, 2011 /PRNewswire/ -- LDK Solar Co., Ltd. ("LDK Solar"; NYSE: LDK), a leading vertically integrated manufacturer of photovoltaic products, today reported its unaudited financial results for the second quarter ended June 30, 2011.
All financial results are reported in U.S. dollars on a U.S. GAAP basis.
Second Quarter Highlights:
Net sales for the second quarter of fiscal 2011 were $499.4 million, compared to $766.3 million for the first quarter of fiscal 2011, and $565.3 million for the second quarter of fiscal 2010.
Gross profit for the second quarter of fiscal 2011, was $11.0 million, compared to $241.6 million in the first quarter of fiscal 2011, and $101.8 million for the second quarter of fiscal 2010.
During the preparation of its second quarter 2011 financial results, LDK Solar's management determined that an inventory write-down of $52.9 million was required as a result of the significant drop in market price for wafers and modules during the second quarter. As a result, gross margin and results from operations were negatively impacted in the second quarter of fiscal 2011.
Gross margin for the second quarter of fiscal 2011 was 2.2%, compared to 31.5% in the first quarter of fiscal 2011 and 18.0% in the second quarter of fiscal 2010.
Loss from operations for the second quarter of fiscal 2011 was $47.9 million, compared to income from operations of $196.1 million for the first quarter of fiscal 2011, and $78.6 million for the second quarter of fiscal 2010.
Operating margin for the second quarter of fiscal 2011 was negative 9.6% compared to positive 25.6% in the first quarter of fiscal 2011 and 13.9% in the second quarter of fiscal 2010.
Income tax expense for the second quarter of fiscal 2011 was $6.7 million, compared to income tax expense of $44.2 million in the first quarter of fiscal 2011 and income tax expense of $7.7 million in the second quarter of fiscal 2010.
Net loss attributable to LDK Solar's shareholders for the second quarter of fiscal 2011 was $87.7 million, or a loss of $0.62 per diluted ADS, compared to net income of $135.4 million, or $0.95 per diluted ADS for the first quarter of fiscal 2011 and $45.0 million, or $0.36 per diluted ADS for the second quarter of fiscal 2010. The number of shares for calculating diluted ADS was approximately 140.7 million for the second quarter of fiscal 2011.
LDK Solar ended the second quarter of fiscal 2011 with $636.4 million in cash and cash equivalents and $515.3 million in short-term pledged bank deposits.
"Our second quarter results reflect the challenging solar industry dynamics that resulted from recent policy revisions in Europe and consequently reduced demand for PV products," stated Xiaofeng Peng, Chairman and CEO of LDK Solar. "Lower pricing across the supply chain negatively impacted our financial results for the quarter.
"In recent weeks, we have seen average selling prices begin to stabilize and improvement to order patterns. We have continued to gain traction in expanding our presence in key markets such as North America and China. In the U.S., our recently established sales and marketing operation has already begun to gain traction in winning large module contracts. In China, we are encouraged by the announcement of the unified national feed-in-tariff program. We have an established, strong market position in our domestic market and see significant long-term growth opportunities.
"We are actively taking steps to improve our cost structure and strengthen our balance sheet. We continue to make progress on lowering our manufacturing costs as we gain scale in our newer PV product areas such as solar cells. Going forward, based on our current pipeline of business, we believe growth will resume in the second half of 2011," concluded Mr. Peng.
Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking in nature, and the actual results may differ materially. You should read the "Safe Harbor Statement" below with respect to the risks and uncertainties relating to these forward-looking statements.
For the third quarter of fiscal 2011, LDK Solar estimates its revenue to be in the range of $630 million to $680 million with wafer shipments between 350 MW and 400 MW, and module shipments between 250 MW and 300 MW, in-house polysilicon production between 2,600 MT and 2,700 MT, in-house cell production between 200 MW and 220 MW and gross margin between 11% and 16%.
For fiscal 2011, LDK Solar estimates its revenue to be in the range of $2.5 to $2.7 billion, wafer shipments between 1.8 gigawatts (GW) and 2.0 GW, module shipments between 750 MW and 800 MW, in-house polysilicon production between 10,000 MT and 11,000 MT, in-house cell production between 600 MW and 700 MW and gross margin between 15% and 20%.
Conference Call Details
The LDK Solar Second Quarter 2011 teleconference and webcast is scheduled to begin at 8:00 a.m. Eastern Time (ET), on August 29, 2011. To listen to the live conference call, please dial 877-941-1427 (within U.S.) or 480-629-9664 (outside U.S.) at 8:00 a.m. ET on August 29, 2011. An audio replay of the call will be available through September 5, 2011, by dialing 800-406-7325 (within U.S.) or 303-590-3030 (outside U.S.) and entering the pass code 4463854#.
A live webcast of the call will be available on the company's investor relations website at http://investor.ldksolar.com.
LDK Solar Co., Ltd. Unaudited Condensed Consolidated Balance Sheet Information (In US$'000) | ||||
6/30/2011 | 3/31/2011 | |||
Assets | ||||
Current assets | ||||
Cash and cash equivalents | 636,447 | 515,081 | ||
Pledged bank deposits | 515,333 | 637,943 | ||
Trade accounts and bills receivable, net | 540,342 | 452,442 | ||
Inventories | 818,790 | 612,783 | ||
Prepayments to suppliers, net | 125,917 | 114,682 | ||
Other current assets | 270,010 | 231,029 | ||
Total current assets | 2,906,839 | 2,563,960 | ||
Property, plant and equipment, net | 3,539,747 | 3,298,766 | ||
Deposits for purchases of property, plant and equipment and land use rights | 153,975 | 187,805 | ||
Land use rights | 270,873 | 223,143 | ||
Prepayments to suppliers expected to be utilized beyond one year, net | 13,408 | 13,849 | ||
Pledged bank deposits – non-current | 45,537 | 47,166 | ||
Investments in an associate and a jointly-controlled entity | 57,576 | 56,617 | ||
Other non-current assets | 68,652 | 50,050 | ||
Total assets | 7,056,607 | 6,441,356 | ||
Liabilities and equity | ||||
Current liabilities | ||||
Short-term borrowings and current installments of long-term borrowings | 2,213,975 | 1,552,198 | ||
Convertible senior notes, less debt discount | -- | 351,489 | ||
Trade accounts and bills payable | 807,012 | 794,695 | ||
Advance payments from customers, current installments | 235,717 | 229,888 | ||
Accrued expenses and other payables | 804,421 | 818,190 | ||
Other financial liabilities | 66,121 | 51,473 | ||
Total current liabilities | 4,127,246 | 3,797,933 | ||
Long-term borrowings, excluding current installments | 804,350 | 794,658 | ||
Convertible senior notes and RMB-denominated US$-settled senior notes, less debt discount | 297,048 | 217,711 | ||
Advance payments from customers – non-current | 149,546 | 163,099 | ||
Other liabilities | 140,785 | 115,669 | ||
Total liabilities | 5,518,975 | 5,089,070 | ||
Redeemable non-controlling interests | 176,316 | -- | ||
Equity | ||||
Total LDK Solar Co., Ltd. shareholders' equity | 1,347,828 | 1,338,627 | ||
Non-controlling interests | 13,488 | 13,659 | ||
Total equity | 1,361,316 | 1,352,286 | ||
Total liabilities and equity | 7,056,607 | 6,441,356 | ||
LDK Solar Co., Ltd. Unaudited Condensed Consolidated Statements of Operations Information (In US$'000, except per ADS data) | ||||
For the 3 Months Ended | ||||
6/30/2011 | 3/31/2011 | |||
Net sales | 499,437 | 766,337 | ||
Cost of goods sold | (488,432) | (524,745) | ||
Gross profit | 11,005 | 241,592 | ||
Selling expenses | (10,108) | (7,427) | ||
General and administrative expenses | (36,210) | (30,038) | ||
Research and development expenses | (12,552) | (7,998) | ||
Total operating expenses | (58,870) | (45,463) | ||
(Loss) Profit from operations | (47,865) | 196,129 | ||
Other income (expenses): | ||||
Interest income | 2,094 | 1,057 | ||
Interest expense and amortization of senior notes issuance costs and debt discount | (38,598) | (31,351) | ||
Foreign currency exchange gain, net | 6,451 | 8,840 | ||
Government subsidies | 308 | 3,455 | ||
Others, net | 1,774 | 1,558 | ||
(Loss) Earnings before income tax | (75,836) | 179,688 | ||
Income tax expense | (6,681) | (44,168) | ||
Net (loss) income | (82,517) | 135,520 | ||
Loss (Earnings) attributable to non-controlling interests | 204 | (82) | ||
Earnings attributable to redeemable non-controlling interests | (2,774) | -- | ||
Accretion to redemption value of redeemable non-controlling interests | (2,621) | -- | ||
Net (loss) income attributable to LDK Solar Co., Ltd. shareholders | (87,708) | 135,438 | ||
Net (loss) income per ADS, Diluted | $ (0.62) | $ 0.95 | ||
About LDK Solar (NYSE: LDK)
LDK Solar Co., Ltd. (NYSE: LDK) is a leading vertically integrated manufacturer of photovoltaic (PV) products. LDK Solar manufactures polysilicon, mono and multicrystalline ingots, wafers, cells, modules, systems, power projects and solutions. LDK Solar's headquarters and principal manufacturing facilities are located in Hi-Tech Industrial Park, Xinyu City, Jiangxi Province in the People's Republic of China. LDK Solar's office in the United States is located in Sunnyvale, California. For more information about LDK Solar and its products, please visit www.ldksolar.com.
Safe Harbor Statement
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact in this press release are forward-looking statements, including but not limited to, LDK Solar's ability to raise additional capital to finance its operating activities, the effectiveness, profitability and marketability of its products, the future trading of its securities, the ability of LDK Solar to operate as a public company, the period of time during which its current liquidity will enable LDK Solar to fund its operations, its ability to protect its proprietary information, the general economic and business environment and conditions, the volatility of LDK Solar's operating results and financial condition, its ability to attract and retain qualified senior management personnel and research and development staff, its ability to timely and efficiently complete its ongoing projects, and other risks and uncertainties disclosed in LDK Solar's filings with the Securities and Exchange Commission. These forward-looking statements involve known and unknown risks and uncertainties and are based on information available to LDK Solar's management as of the date hereof and on its current expectations, assumptions, estimates and projections about LDK Solar and the PV industry. Actual results may differ materially from the anticipated results because of such and other risks and uncertainties. LDK Solar undertakes no obligation to update forward-looking statements to reflect subsequent events or circumstances, or changes in its expectations, assumptions, estimates and projections except as may be required by law.
SOURCE LDK Solar Co., Ltd.