Daqo New Energy Announces Unaudited First Quarter 2024 Results
First Quarter 2024 Financial and Operating Highlights
- Polysilicon production volume was 62,278 MT in Q1 2024, compared to 61,014 MT in Q4 2023
- Polysilicon sales volume was 53,987 MT in Q1 2024 compared to 59,906 MT in Q4 2023
- Polysilicon average total production cost(1) was
$6.37 /kg in Q1 2024 compared to$6.50 /kg in Q4 2023 - Polysilicon average cash cost(1) was
$5.61 /kg in Q1 2024, compared to$5.72 /kg in Q4 2023 - Polysilicon average selling price (ASP) was
$7.66 /kg in Q1 2024, compared to$7.97 /kg in Q4 2023 - Revenue was
$415.3 million in Q1 2024, compared to$476.3 million in Q4 2023 - Gross profit was
$72.1 million in Q1 2024, compared to$87.2 million in Q4 2023. Gross margin was 17.4% in Q1 2024, compared to 18.3% in Q4 2023 - Net income attributable to Daqo New Energy Corp. shareholders was
$15.5 million in Q1 2024, compared to$53.3 million in Q4 2023 - Earnings per basic American Depositary Share (ADS)(3) was
$0.24 in Q1 2024, compared to earnings per basic ADS of$0.76 in Q4 2023 - Adjusted net income (non-GAAP)(2) attributable to
Daqo New Energy Corp. shareholders was$36.0 million in Q1 2024, compared to$74.3 million in Q4 2023 - Adjusted earnings per basic ADS(3) (non-GAAP)(2) was
$0.55 in Q1 2024, compared to$1.06 in Q4 2023 - EBITDA (non-GAAP)(2) was $76.9 million in Q1 2024, compared to
$128.2 million in Q4 2023. EBITDA margin (non-GAAP)(2) was 18.5% in Q1 2024, compared to 26.9% in Q4 2023
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Three months ended |
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US$ millions except as indicated otherwise |
March. 31, 2024 |
December. |
March. 31, 2023 |
Revenues |
415.3 |
476.3 |
709.8 |
Gross profit |
72.1 |
87.2 |
506.7 |
Gross margin |
17.4 % |
18.3 % |
71.4 % |
Income from operations |
30.5 |
83.3 |
463.8 |
Net income attributable to |
15.5 |
53.3 |
278.8 |
Earnings per basic ADS(3) ($ per ADS) |
0.24 |
0.76 |
3.56 |
Adjusted net income (non-GAAP)(2) attributable to |
36.0 |
74.3 |
310.2 |
Adjusted earnings per basic ADS(3) (non-GAAP)(2) |
0.55 |
1.06 |
3.96 |
EBITDA (non-GAAP) (2) |
76.9 |
128.2 |
490.2 |
EBITDA margin (non-GAAP)(2) |
18.5 % |
26.9 % |
69.1 % |
Polysilicon sales volume (MT) |
53,987 |
59,906 |
25,284 |
Polysilicon average total production cost ($/kg) (1) |
6.37 |
6.50 |
7.55 |
Polysilicon average cash cost (excl. dep'n) ($/kg) (1) |
5.61 |
5.72 |
6.61 |
Notes:
(1) Production cost and cash cost only refer to production in our polysilicon facilities. Production cost is calculated by the inventoriable costs relating to production of polysilicon divided by the production volume in the period indicated. Cash cost is calculated by the inventoriable costs relating to production of polysilicon excluding depreciation cost and non-cash share-based compensation cost, divided by the production volume in the period indicated.
(2)
(3) ADS means American Depositary Share. One (1) ADS represents five (5) ordinary shares.
Management Remarks
Mr.
"We expect Q2 2024 total polysilicon production volume to be approximately 60,000 MT to 63,000 MT, similar to that of Q1 2024 as the Company maintains full production. We expect to finish construction and begin initial pilot production at our new Inner Mongolia Phase 5B facility in Q2 2024 and expect to ramp up to full production level by the end of Q3 2024. As a result, we anticipate full year 2024 production volume to be in the range of 280,000 MT to 300,000 MT, approximately 40% to 50% higher than that of 2023. With more than 15 years of experience in polysilicon production, as well as a fully digitalized and integrated production system that optimizes operational efficiency, we will continue to increase N-type production in the product mix."
"During the first quarter, the solar market initially showed signs of strength as we headed into the
"2023 marked a step change for renewable power growth, with
Outlook and guidance
The Company expects to produce approximately 60,000MT to 63,000MT of polysilicon during the second quarter of 2024. The Company expects to produce approximately 280,000MT to 300,000MT of polysilicon for the full year of 2024, inclusive of the impact of the Company's annual facility maintenance.
This outlook reflects
First Quarter 2024 Results
Revenues
Revenues were
Gross profit and margin
Gross profit was
Selling, general and administrative expenses
Selling, general and administrative expenses were
Research and development expenses
Research and development (R&D) expenses were
Income from operations and operating margin
As a result of the foregoing, income from operations was
Operating margin was 7.3%, compared to 17.5% in the fourth quarter of 2023 and 65.3% in the first quarter of 2023.
Foreign exchange loss
Foreign exchange loss was
Net income attributable to
As a result of the aforementioned, net income attributable to
Earnings per basic American Depository Share (ADS) was
Adjusted income (non GAAP) attributable to
As a result of the aforementioned, adjusted net income (non-GAAP) attributable to
Adjusted earnings per basic American Depository Share (ADS) was
EBITDA
EBITDA (non-GAAP) was
Financial Condition
As of
Cash Flows
For the three months ended
For the three months ended
For the three months ended
Use of Non-GAAP Financial Measures
To supplement
The Company uses EBITDA, which represents earnings before interest, taxes, depreciation and amortization, and EBITDA margin, which represents the proportion of EBITDA in revenues. Adjusted net income attributable to
A reconciliation of non-GAAP financial measures to comparable US GAAP measures is presented later in this document.
Conference Call
The Company has scheduled a conference call to discuss the results at 8:00 AM
The dial-in details for the earnings conference call are as follows:
Participant dial in (
Participant international dial in: +1-412-902-4272
Please dial in 10 minutes before the call is scheduled to begin and ask to join the
Webcast link:
https://event.choruscall.com/mediaframe/webcast.html?webcastid=yep6EhXD
A replay of the call will be available 1 hour after the conclusion of the conference call through
International toll: +1-412-317-0088
Replay access code: 4304836
To access the replay through an international dial-in number, please select the link below.
https://services.choruscall.com/ccforms/replay.html
Participants will be asked to provide their name and company name upon entering the call.
About
Safe Harbor Statement
This announcement contains forward-looking statements. These statements are made under the "safe harbor" provisions of the
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Unaudited Condensed Consolidated Statement of Operations |
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(US dollars in thousands, except ADS and per ADS data) |
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Three months Ended |
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|
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Revenues |
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|
|
|
|
|
|
Cost of revenues |
|
(343,226) |
|
(389,102) |
|
(203,102) |
|
Gross profit |
|
72,085 |
|
87,196 |
|
506,732 |
|
Operating expenses |
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
(38,433) |
|
(39,004) |
|
(41,284) |
|
Research and development expenses |
|
(1,538) |
|
(3,250) |
|
(1,938) |
|
Other operating income |
|
(1,605) |
|
38,349 |
|
292 |
|
Total operating expenses |
|
(41,576) |
|
(3,905) |
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(42,930) |
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Income from operations |
|
30,509 |
|
83,291 |
|
463,802 |
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Interest income, net |
|
12,270 |
|
13,772 |
|
11,947 |
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Foreign exchange loss |
|
(269) |
|
(796) |
|
- |
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Investment Income |
|
- |
|
253 |
|
13 |
|
Income before income taxes |
|
42,510 |
|
96,520 |
|
475,762 |
|
Income tax expense |
|
(14,356) |
|
(18,352) |
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(81,067) |
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Net income |
|
28,154 |
|
78,168 |
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394,695 |
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Net income attributable to non-controlling interest |
|
12,681 |
|
24,837 |
|
115,891 |
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Net income attributable to |
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Earnings per ADS |
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|
|
|
|
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Basic |
|
0.24 |
|
0.76 |
|
3.56 |
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Diluted |
|
0.24 |
|
0.76 |
|
3.52 |
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Weighted average ADS outstanding |
|
|
|
|
|
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Basic |
|
65,704,356 |
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69,862,986 |
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78,298,405 |
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Diluted |
|
65,720,945 |
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69,905,271 |
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78,839,166 |
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Unaudited Consolidated Balance Sheets |
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(US dollars in thousands) |
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ASSETS: |
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|
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|
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Current Assets: |
|
|
|
|
|
|
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Cash, cash equivalents and restricted cash |
|
2,689,310 |
|
3,047,956 |
|
4,130,549 |
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Short-term investments |
|
- |
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- |
|
5,823 |
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Notes receivable |
|
194,088 |
|
116,358 |
|
791,346 |
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Inventories |
|
191,161 |
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173,271 |
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191,708 |
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Other current assets |
|
229,893 |
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238,993 |
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70,223 |
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Total current assets |
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3,304,452 |
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3,576,578 |
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5,189,649 |
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Property, plant and equipment, net |
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3,731,647 |
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3,626,423 |
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2,884,700 |
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Prepaid land use right |
|
157,046 |
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150,358 |
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80,221 |
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Other non-current assets |
|
54,688 |
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73,507 |
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35,672 |
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TOTAL ASSETS |
|
7,247,833 |
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7,426,866 |
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8,190,242 |
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|
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|
|
|
|
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Current liabilities: |
|
|
|
|
|
|
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Short-term borrowings |
|
- |
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- |
|
140,000 |
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Accounts payable and notes payable |
|
67,329 |
|
92,879 |
|
97,402 |
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Advances from customers-short term portion |
|
128,697 |
|
148,984 |
|
184,936 |
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Payables for purchases of property, plant and equipment |
|
409,689 |
|
421,024 |
|
266,164 |
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Other current liabilities |
|
114,227 |
|
173,542 |
|
252,400 |
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Total current liabilities |
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719,942 |
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836,429 |
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940,902 |
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Advance from customers – long term portion |
|
113,600 |
|
113,857 |
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160,267 |
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Other non-current liabilities |
|
28,329 |
|
28,296 |
|
105,792 |
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TOTAL LIABILITIES |
|
861,871 |
|
978,582 |
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1,206,961 |
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EQUITY: |
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4,716,390 |
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4,761,907 |
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5,063,463 |
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Non-controlling interest |
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1,669,572 |
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1,686,377 |
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1,919,818 |
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Total equity |
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6,385,962 |
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6,448,284 |
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6,983,281 |
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TOTAL LIABILITIES & EQUITY |
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7,247,833 |
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7,426,866 |
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8,190,242 |
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Unaudited Consolidated Statements of Cash Flows |
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(US dollars in thousands) |
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For the three months ended |
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2024 |
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2023 |
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Operating Activities: |
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|
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Net income |
|
|
|
|
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Adjustments to reconcile net income to net cash provided by |
|
75,364 |
|
64,183 |
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Changes in operating assets and liabilities |
|
(219,450) |
|
348,161 |
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Net cash (used in) / provided by operating activities |
|
(115,932) |
|
807,039 |
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|
|
|
|
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Investing activities: |
|
|
|
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Purchases of property, plant and equipment |
|
(180,369) |
|
(277,058) |
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Purchases of land use right |
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(10,115) |
|
- |
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Redemption of short-term investments |
|
- |
|
8,167 |
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Net cash used in investing activities |
|
(190,484) |
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(268,891) |
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|
|
|
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Financing activities: |
|
|
|
|
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Net cash (used in) / provided by financing activities |
|
(6,004) |
|
59,865 |
|
|
|
|
|
|
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Effect of exchange rate changes |
|
(46,226) |
|
12,185 |
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Net (decrease) / increase in cash, cash equivalents and restricted |
|
(358,646) |
|
610,198 |
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Cash, cash equivalents and restricted cash at the beginning of the |
|
3,047,956 |
|
3,520,351 |
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Cash, cash equivalents and restricted cash at the end of the period |
|
2,689,310 |
|
4,130,549 |
|
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Reconciliation of non-GAAP financial measures to comparable US GAAP measures |
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(US dollars in thousands) |
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Three months Ended |
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|
|
|
|
|
|
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Net income |
|
28,154 |
|
78,168 |
|
394,695 |
|
Income tax expense |
|
14,356 |
|
18,352 |
|
81,067 |
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Interest income, net |
|
(12,269) |
|
(13,772) |
|
(11,947) |
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Depreciation & amortization |
|
46,669 |
|
45,455 |
|
26,399 |
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EBITDA (non-GAAP) |
|
76,910 |
|
128,203 |
|
490,214 |
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EBIDTA margin (non-GAAP) |
|
18.5 % |
|
26.9 % |
|
69.1 % |
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Three months Ended |
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|
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Net income attributable to Daqo New Energy |
|
15,473 |
|
53,331 |
|
278,804 |
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Share-based compensation |
|
20,574 |
|
20,927 |
|
31,401 |
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Adjusted net income (non-GAAP) attributable |
|
36,047 |
|
74,258 |
|
310,205 |
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Adjusted earnings per basic ADS (non-GAAP) |
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Adjusted earnings per diluted ADS (non- |
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