JA Solar Holdings Co., Ltd.: Second Quarter 2009 Financial Results
SHANGHAI, Aug. 12 / JA Solar Holdings Co., Ltd., a leading manufacturer of high-performance solar products, today announced financial results for its second quarter ended June 30, 2009.
Second Quarter 2009 Results
Revenue in the second quarter of 2009 was RMB 600.7 million ($88.0 million), a decrease of 51.4 percent from RMB 1.2 billion ($181.1 million) in the second quarter of 2008 and an increase of 159.3 percent from RMB 231.7 million ($33.9 million) reported in the first quarter of 2009. Total gross profit in the second quarter was RMB 68.3 million ($10.0 million) or 11.4 percent, compared with RMB 288.4 million ($42.2 million) or 23.3 percent in the second quarter of 2008, and gross loss of RMB 142.7 million ($20.9 million) or 61.6 percent in the first quarter of 2009.
Total operating expenses in the second quarter of 2009 were RMB 177.4 million ($26.0 million), compared with RMB 72.1 million ($10.6 million) in the second quarter of 2008 and RMB 50.4 million ($7.4 million) in the first quarter of 2009. Included in operating expenses was a charge of RMB 81.1 million ($11.9 million) of non-cash stock-based compensation charge in the second quarter of 2009, compared with RMB 44.3 million ($6.5 million) in the second quarter of 2008 and RMB 11.9 million ($1.7 million) in the first quarter of 2009. Stock-based compensation charge in the second quarter of 2009 included a one-time charge of RMB 56.3 million ($8.2 million) related to surrender of stock options to the company by employees during the quarter. In the second quarter of 2009, the company also recorded a reserve for prepayment to suppliers and provision for accounts receivable of RMB 44.5 million ($6.5 million). Total operating expenses, excluding the stock-based compensation charge and the reserve for prepayment to suppliers and provision for accounts receivable, were RMB 51.9 ($7.6 million).
Operating loss in the second quarter of 2009 was RMB 109.0 million (a loss of $16.0 million), compared with operating income of RMB 216.3 million ($31.7 million) in the second quarter of 2008 and operating loss of RMB 193.1 million (a loss of $28.3 million) in the first quarter of 2009. Excluding stock-based compensation charge, provision for prepayments to suppliers and reserve for receivables, the company generated an operating income of RMB 16.5 million ($2.4 million) for the second quarter of 2009.
GAAP net loss per diluted ADS in the second quarter of 2009 was RMB 1.21 (a loss of $0.18), compared with net loss per diluted ADS of RMB 0.04 (a loss of $0.01) in the same period of 2008 and net loss per diluted ADS of RMB 1.20 (a loss of $0.18) in the first quarter of 2009.
At June 30, 2009, JA Solar had cash and cash equivalents of RMB 2.2 billion ($328.8 million), compared with RMB 1.3 billion ($192.9 million) at March 31, 2009. During the second quarter of 2009, the company used long-term loans with favorable interest rates obtained from Chinese banks to retire certain short-term loans. The company also repurchased RMB 128.1 million ($18.8 million) face value of convertible bonds at discount during the second quarter, and RMB 170.7 million ($25.0 million) face value subsequent to the quarter end. As a result of positive operating cash flow in the quarter and the effort to strengthen the balance sheet, the company's working capital balance at June 30, 2009 improved by 37.6 percent from RMB 2.6 billion ($385.4 million) at the end of the first quarter to RMB 3.6 billion ($530.5 million) at June 30, 2009. The convertible bonds outstanding at June 30, 2009 were RMB 2.0 billion ($296.5 million) and RMB 1.9 billion ($271.5 million) as of today. Total long-term bank loans outstanding at June 30, 2009 were RMB 920.0 million ($134.7 million).
"We are pleased with our second quarter results, which reflect our success in growing JA Solar's customer base and our market share," said Baofang Jin, JA Solar's chairman and CEO. "JA Solar continues to offer high quality products at a very competitive price, afforded by our industry-leading technology and cost structure. We are also pleased that because of our focus on operations and cost reductions, we were able to show gross margin improvement in the second quarter," he said.
"Looking ahead, we are seeing significant signs of market improvement in both end-market demand and financing. We believe our cost structure and customer relationships will drive even stronger third quarter results," he said.
Investor Conference Call / Webcast Details
A conference call has been scheduled for today, Wednesday, Aug. 12, 2009 at 8:00 am Eastern time. The call may be accessed by dialing 1.866.271.0675 (U.S.) or 1.617.213.8892 (international). The passcode is JA Solar. A live webcast of the conference call will be available on the company's website at www.jasolar.com. A replay of the call will be available beginning two hours after the live call and will be accessible by dialing 1.888.286.8010 (U.S.) or 1.617.801.6888 (international). The passcode for the replay is 35619617.
Currency Convenience Translation
The conversion of Renminbi into U.S. dollars in this release, made solely for the convenience of the reader, is based on the noon buying rate in the city of New York for cable transfers of Renminbi as certified for customs purposes by the Federal Reserve Bank of New York as of June 30, 2009, which was RMB 6.8302 to $1.00. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollars at that rate on June 30, 2009, or at any other date. The percentages stated in this press release are calculated based on Renminbi.