LDK Solar Reports Financial Results for the Third Quarter 2007
Dec 19,2007
Xinyu City, China and Sunnyvale, California, December 19, 2007 – LDK Solar Co., Ltd. (NYSE:LDK), a leading manufacturer of multicrystalline solar wafers, today reported its unaudited financial results for the third quarter ended September 30, 2007.
All financial results are reported on a U.S. GAAP basis.
Third Quarter 2007 Financial Highlights:
- Revenue of $158.7 million, up 60% quarter-over-quarter
- Gross profit of $48.9 million, up 40% quarter-over-quarter
- Net income of $41.6 million, or $0.37 per diluted ADS, up 45% quarter-over-quarter
- Signed four long-term wafer supply agreements during the third quarter
- Total wafer shipments increased 49% sequentially to 78.9MW in the third quarter
Net sales for the third quarter of fiscal 2007 were $158.7 million, up 60.2% sequentially from $99.1 million for the second quarter of fiscal 2007, and up 404.7% year-over-year from $31.5 million for the third quarter of fiscal 2006.
Gross profit for the third quarter of fiscal 2007 was $48.9 million, up 40.2% sequentially from $34.9 million for the second quarter of fiscal 2007, and up 295.1% year-over-year from $12.4 million for the third quarter of fiscal 2006.Gross margin for the third quarter of fiscal 2007 was 30.8% compared with 35.2% in the second quarter of fiscal 2007 and 39.4% in the third quarter of fiscal 2006.
Net income for the third quarter of fiscal 2007 was $41.6 million, or $0.37 per diluted ADS, compared to net income of $28.7 million, or $0.29 per diluted ADS for the second quarter of fiscal 2007, and $5.0 million, or $0.04 per diluted ADS for the third quarter of fiscal 2006.
The Company ended the third quarter of fiscal 2007 with $125.9 million in cash and cash equivalents.
“We are pleased to report strong results for the third quarter, following a positive outcome of the independent inventory review,” stated Xiaofeng Peng, Chairman and CEO of LDK Solar.“With the inventory investigation behind us, we have returned our focus to growing our business.During the third quarter we experienced continued robust demand for our wafers and made great strides in expanding our customer base.We signed four long-term wafer supply contracts during the third quarter and five more since the quarter closed. We view these agreements as a testament to the quality of our products.
“We remain on track to meet our wafer production capacity goal of 400MW by the end of 2007. Additionally, the construction of our polysilicon plant is tracking with our original plan.In addition to the anticipated cost efficiencies we expect to achieve upon completion of our polysilicon plant, we are continuing cost reduction efforts through further advancements of our product processes,” concluded Mr. Peng.
Business Outlook
The following statements are based upon management's current expectations. These statements are forward-looking, and actual results may differ materially. The Company undertakes no obligation to update these statements.
For the fourth quarter of fiscal 2007, LDK estimates revenue to be in the range of $180 to $185 million for wafer shipments of 87 to 92MW.The Company also estimates fully diluted earnings per ADS to be in the range of $0.40 to $0.43.
Conference Call Details
The LDK Third Quarter teleconference and webcast is scheduled to begin at 6:00 p.m. Eastern Time (ET), on Wednesday, December 19, 2007. To listen to the live conference call, please dial 800-366-7449 (within U.S.) or 303-262-2193 (outside U.S.) at 5:50 p.m. ET on December 19, 2007. An audio replay of the call will be available to investors through December 24, 2007, by dialing 800-405-2236 (within U.S.) or 303-590-3000 (outside U.S.) and entering the passcode 11104747##.
A live webcast of the call will be available on the company's investor relations website at investor.ldksolar.com.
LDK Solar Co., Ltd. |
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Unaudited Condensed Consolidated Balance Sheet Information |
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(In US$'000, except share and per share data) |
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|
9/30/2007 |
|
6/30/2007 |
Assets |
|
|
|
Current assets |
|
|
|
Cash and cash equivalents |
125,858 |
|
250,600 |
Pledged bank deposits |
106,840 |
|
2,722 |
Trade accounts receivable, net |
8,666 |
|
7,825 |
Inventories |
224,527 |
|
173,778 |
Prepayments to suppliers |
183,467 |
|
129,902 |
Deferred expenses |
236 |
|
281 |
Other current assets |
9,325 |
|
6,281 |
Total current assets |
658,919 |
|
571,389 |
Property, plant and equipment, net |
224,477 |
|
169,330 |
Deposit for purchase of equipment |
136,870 |
|
40,840 |
Intangible asset, net |
1,098 |
|
1,117 |
Land use rights |
29,152 |
|
8,060 |
Deferred income tax assets |
757 |
|
151 |
Long-term prepayments to suppliers |
10,626 |
|
|
Total assets |
1,061,899 |
|
790,887 |
|
|
|
|
Liabilities and shareholders' equity |
|
|
|
Current liabilities |
|
|
|
Short-term bank borrowings |
186,559 |
|
80,036 |
Trade accounts payable |
23,044 |
|
9,525 |
Advance payments from customers |
154,931 |
|
72,232 |
Accrued expenses and other payables |
42,278 |
|
33,592 |
Total current liabilities |
406,812 |
|
195,385 |
Deferred revenue |
2,280 |
|
- |
Long-term bank borrowings, excluding current portions |
29,967 |
|
29,890 |
Total liabilities |
439,059 |
|
225,275 |
Shareholders' equity |
|
|
|
Ordinary shares: US$0.10 par value; 134,000,000 shares authorized; 104,587,700 and 106,044,700 shares issued and outstanding as of June 30, 2007 and September 30, 2007, respectively |
10,604 |
|
10,458 |
Additional paid-in capital |
482,419 |
|
473,696 |
Statutory reserve |
3,623 |
|
3,623 |
Accumulated other comprehensive income |
14,259 |
|
7,505 |
Retained earnings |
111,935 |
|
70,330 |
Total shareholders' equity |
622,840 |
|
565,612 |
|
|
|
|
Total liabilities and shareholders' equity |
1,061,899 |
|
790,887 |
|
|
|
|
LDK Solar Co., Ltd. |
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Unaudited Condensed Consolidated Income Statement Information |
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(In US$'000, except per ADS data) |
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|
For the 3 Months Ended |
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|
9/30/2007 |
6/30/2007 |
9/30/2006 |
|
|
|
|
Net sales |
158,724 |
99,053 |
31,450 |
Cost of goods sold |
(109,807) |
(64,153) |
(19,069) |
Gross profit |
48,917 |
34,900 |
12,381 |
Selling expenses |
(348) |
(132) |
(117) |
General and administrative expenses |
(4,459) |
(3,579) |
(1,633) |
Research and development expenses |
(921) |
(367) |
(76) |
Total operating expenses |
(5,728) |
(4,078) |
(1,826) |
Income from operations |
43,189 |
30,822 |
10,555 |
Other income/(expenses): |
|
|
|
Interest income |
1,846 |
271 |
26 |
Interest expense and amortization of discount on exchangeable notes |
(2,650) |
(2,180) |
(4,961) |
Decrease in fair value of warrants |
- |
2 |
9 |
Foreign currency exchange loss, net |
(2,041) |
(576) |
(667) |
Government subsidy |
662 |
406 |
- |
Income before income tax |
41,006 |
28,745 |
4,962 |
Income tax benefit |
599 |
- |
- |
Net Income |
41,605 |
28,745 |
4,962 |
Accretion of Series A preferred shares to redemption value |
- |
(348) |
(262) |
Accretion of Series B preferred shares to redemption value |
- |
(1,101) |
(267) |
Accretion of Series C preferred shares to redemption value |
- |
(546) |
- |
Deemed dividend to series A preferred shareholders |
- |
- |
(1,568) |
Net income available to ordinary shareholders |
41,605 |
26,750 |
2,865 |
Net income per ADS, Diluted |
$0.37 |
$0.29 |
$0.04 |
About LDK Solar
LDK Solar Co., Ltd. is a leading manufacturer of multicrystalline solar wafers, which are the principal raw material used to produce solar cells. LDK sells multicrystalline wafers globally to manufacturers of photovoltaic products, including solar cells and solar modules. In addition, the company provides wafer processing services to monocrystalline and multicrystalline solar cell and module manufacturers.LDK’s headquarters and manufacturing facilities are located in Hi-Tech Industrial Park, Xinyu City, Jiangxi province in the People’s Republic of China. The company’s office in the United States is located in Sunnyvale, California.
Safe Harbor Statement
This press release includes statements that may constitute forward-looking statements made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Although LDK believes that the expectations reflected in such forward-looking statements are based on reasonable assumptions, such statements are subject to risk and uncertainties that could cause actual results to differ materially from those projected.
For more information contact:
Lisa Laukkanen
The Blueshirt Group for LDK Solar
lisa@blueshirtgroup.com
+1-415-217-4967
Jack Lai
Executive VP and CFO
LDK Solar Co., Ltd.
IR@ldksolar.com
+1- 408-245-8801