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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.
Forward-looking Statements
This press release contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words such as "will," "may," "expect," "anticipate," "aim," "intend," "plan," "believe," "estimate," "potential," "continue," and other similar statements. Statements other than statements of historical facts in this announcement are forward-looking statements, including but not limited to, our expectations regarding the expansion of our manufacturing capacities, our future business development, and our beliefs regarding our production output and production outlook. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Further information regarding these and other risks is included in Form F-20 and other documents filed with the Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
About JA Solar Holdings Co., Ltd.
JA Solar Holdings Co., Ltd. is a leading manufacturer of high-performance solar cells. The company sells its products to solar manufacturers worldwide, who assemble and integrate solar cells into modules and systems that convert sunlight into electricity for residential, commercial, and utility-scale power generation. For more information, please visit http://www.jasolar.com.
JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
(Unaudited)
For three months ended
Jun. 30, 2008 Mar. 31, 2009 Jun. 30, 2009 Jun. 30, 2009
RMB'000 RMB'000 RMB'000 USD'000
Net revenues 1,236,677 231,684 600,729 87,952
Cost of sales (948,228) (374,424) (532,402) (77,948)
-------- -------- -------- -------
Gross profit 288,449 (142,740) 68,327 10,004
------- -------- ------ ------
Selling,
general and
administrative
expenses (66,588) (39,466) (163,949) (24,003)
Research and
development
expenses (5,545) (10,937) (13,425) (1,966)
------ ------- ------- ------
Total
operating
expenses (72,133) (50,403) (177,374) (25,969)
------- ------- -------- -------
Income/(loss)
from
operations 216,316 (193,143) (109,047) (15,965)
------- -------- -------- -------
Interest
expense (32,948) (58,155) (57,256) (8,383)
Change in fair
value of
derivatives 175,662 33,318 (52,760) (7,725)
Gain on
buyback of
convertible
bond - 13,817 11,044 1,617
Other income/
(expenses) (35,283) (8,524) 13,879 2,032
Income/(loss)
before income
taxes 323,747 (212,687) (194,140) (28,424)
------- -------- -------- -------
Income tax
benefit/
(expenses) (5,187) 19,419 (605) (89)
------ ------ ---- ---
Net income/
(loss) 318,560 (193,268) (194,745) (28,513)
------- -------- -------- -------
Net income/(loss)
per share:
Basic 2.06 (1.20) (1.21) (0.18)
Diluted (0.04) (1.20) (1.21) (0.18)
Weighted average
number of shares
outstanding:
Basic 154,519,808 161,419,260 161,419,260 161,419,260
Diluted 163,688,037 161,419,260 161,419,260 161,419,260
JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
(Unaudited)
For six months ended
Jun. 30, 2008 Jun. 30, 2009 Jun. 30, 2009
RMB'000 RMB'000 USD'000
Net revenues 2,358,710 832,413 121,872
Cost of sales (1,834,403) (906,826) (132,767)
---------- -------- --------
Gross profit 524,307 (74,413) (10,895)
------- ------- -------
Selling, general and
administrative expenses (136,193) (203,415) (29,782)
Research and development
expenses (8,242) (24,362) (3,567)
------ ------- ------
Total operating expenses (144,435) (227,777) (33,349)
-------- -------- -------
Income/(loss) from
operations 379,872 (302,190) (44,244)
------- -------- -------
Interest expense (33,441) (115,411) (16,897)
Change in fair value of
derivatives 216,384 (19,442) (2,846)
Gain on buyback of
convertible bond - 24,861 3,640
Other income/(expenses) (75,584) 5,355 785
Income/(loss) before
income taxes 487,231 (406,827) (59,562)
------- -------- -------
Income tax benefit/
(expenses) (14,203) 18,814 2,755
------- ------ -----
Net income/(loss) 473,028 (388,013) (56,807)
------- -------- -------
Net income/(loss) per share:
Basic 3.07 (2.40) (0.35)
Diluted 0.92 (2.40) (0.35)
Weighted average number of
shares outstanding:
Basic 154,291,717 161,419,260 161,419,260
Diluted 159,733,545 161,419,260 161,419,260
JA Solar Holdings Co., Ltd.
Condensed Consolidated Balance Sheets
(Unaudited)
December 31, June 30,
2008 2009 2009
RMB'000 RMB'000 USD'000
ASSETS
Current assets:
Cash and cash equivalents 1,542,784 2,245,571 328,771
Restricted cash 33,061 41,517 6,078
Short term investment 421,865 - -
Accounts receivable 355,051 141,388 20,700
Inventories 591,989 744,877 109,056
Advances to suppliers 680,447 690,884 101,151
Other current assets 205,227 223,186 32,678
------- ------- ------
Total current assets 3,830,424 4,087,423 598,434
--------- --------- -------
Property and equipment, net 1,369,807 1,443,364 211,321
Advances to suppliers 1,944,912 1,778,886 260,444
Derivative asset-Capped call options 4,485 2,242 328
Deferred issuance cost 58,953 50,898 7,452
Other long term assets 70,603 78,129 11,439
------ ------ ------
Total assets 7,279,184 7,440,942 1,089,418
========= ========= =========
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Short-term bank borrowings 490,000 130,000 19,033
Accounts payable 117,982 127,041 18,600
Accrued and other liabilities 262,842 207,251 30,343
------- ------- ------
Total current liabilities 870,824 464,292 67,976
------- ------- ------
Convertible Bond 1,532,600 1,466,277 214,676
Embedded derivatives 115,676 123,534 18,087
Long-term bank borrowings - 920,000 134,696
Other long term liabilities 5,185 22,219 3,252
----- ------ -----
Total liabilities 2,524,285 2,996,322 438,687
--------- --------- -------
Commitment and Contingencies
Shareholders' equity 4,754,899 4,444,620 650,731
--------- --------- -------
Total liabilities and shareholders'
equity 7,279,184 7,440,942 1,089,418
========= ========= =========
SOURCE JA Solar Holdings Co., Ltd.
http://www.jasolar.com
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