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JA Solar Announces First Quarter 2016 Results

BEIJING, May 27, 2016 (GLOBE NEWSWIRE) -- JA Solar Holdings Co., Ltd. (Nasdaq:JASO) ("JA Solar" or the "Company"), one of the world's largest manufacturers of high-performance solar power products, today announced its unaudited financial results for its first quarter ended March 31, 2016.

First Quarter 2016 Highlights

  • Total shipments were 1,128.3 megawatts (“MW”), consisting of 1,038.3 MW of modules and cells to external customers, and 90.0 MW of modules to the Company’s own downstream projects. External shipments were up +52.4% y/y and down -22.4% sequentially

  • Shipments of modules and module tolling were 919.4 MW, an increase of +57.4% y/y and decrease of 29.1% sequentially

  • Shipments of cells and cell tolling were 118.9 MW, an increase of +22.1% y/y and +188.6% sequentially
  • Net revenue was RMB 3.5 billion ($538.1 million), an increase of +44.4% y/y and decrease of 24.5% sequentially
  • Gross margin was 16.6%, an increase of 50 basis points y/y and decrease of 50 basis points sequentially
  • Operating profit was RMB 223.3 million ($34.6 million), compared to RMB 149.6 million ($23.2 million) in the first quarter of 2015, and RMB 260.1 million ($40.3 million) in the fourth quarter of 2015
  • Net income was RMB 158.0 million ($24.5 million), compared to RMB 35.0 million ($5.4 million) in the first quarter of 2015, and RMB 184.9 million ($28.7 million) in the fourth quarter of 2015
  • Earnings per diluted ADS were RMB 2.74 ($0.43), compared to RMB 0.59 ($0.09) in the first quarter of 2015, and RMB 3.39 ($0.53) in the fourth quarter of 2015
  • Cash and cash equivalents were RMB 2.3 billion ($362.1 million), a decrease of RMB 548.4 million ($85.0 million) during the quarter
  • Non-GAAP earnings1 per diluted ADS were RMB 2.33 ($0.36), compared to RMB 0.82 ($0.13) in the first quarter of 2015, and RMB 3.14 ($0.49) in the fourth quarter of 2015

Mr. Baofang Jin, Chairman and CEO of JA Solar, commented, “We are satisfied with our performance this quarter. We experienced the normal seasonal decline from the fourth quarter to first quarter, as expected, yet our results showed meaningful year over year growth. Revenue was up nearly 45% and non-GAAP EPS increased more than twofold. We saw the most strength in our domestic market, a natural consequence of the accelerated pace of activity we expected in the first half of the year. Notably, we expect to connect around 250 MW of projects before June 30, supporting our momentum in our downstream project development business. Although regulatory change will slow the China market in the second half, our balanced market footprint gives us plenty of sales opportunities around the world.”

Jin continued, “Our success in key markets is due to our high standards for product quality and our leading technology. Recent evidence of our leadership is our dominant ‘market share’ in the National Energy Administration’s ‘Front Runner’ Program. We are supplying 420 MW of highly advanced modules, including 150 MW of PERC modules, to the program Phase I totaling 950 MW in Datong, Shanxi province. Furthermore, we expect to increase our PERC capacity to 1.4 GW by the end of 2016. JA Solar is proud to play a key role in the transformation and improvement of China's PV and manufacturing sectors.”

All shipment and financial figures refer to the quarter ended March 31, 2016, unless otherwise specified. All “year over year” or “y/y” comparisons are against the quarter ended March 31, 2015. All “sequential” comparisons are against the quarter ended December 31, 2015.

Total shipments were 1,128.3 MW, exceeding the high end of the previously announced guidance range of 1,000 to 1,100 MW. External shipments of 1,038.3 MW increased 52.4% year over year and decreased 22.4% sequentially.

External shipments breakdown by product (MW)

2015Q12015Q42016Q1QoQ%YoY%
Modules and module tolling584.11297.6919.4 -29.1% 57.4%
Cells and cell tolling97.441.2118.9 188.6% 22.1%
Total681.51338.81,038.3 -22.4% 52.4%

External shipments breakdown by region (percentage)

2015Q12015Q42016Q1QoQ(pp)YoY(pp)
China 21.4% 43.8% 59.6%15.8pp38.2pp
APAC ex-China 53.9% 40.5% 26.7%-13.8pp-27.2pp
Europe 22.6% 5.1% 5.6%0.5pp-17.0pp
Americas 1.0% 8.4% 4.5%-3.9pp3.5pp
Others 1.1% 2.2% 3.6%1.4pp2.5pp

Net revenue was RMB 3.5 billion ($538.1 million), an increase of 44.4% y/y and decrease of 24.5% sequentially. The sequential decrease in net revenue reflected seasonality in the PV industry.

Gross profit of RMB 575.4 million ($89.2 million) increased 48.8% y/y and decreased 26.6% sequentially. Gross margin was 16.6%, which compares to 16.1% in the year-ago quarter, and 17.1% in the fourth quarter of 2015. The sequential decrease in gross margin was mainly due to increasing wafer price during the quarter.

Total operating expenses of RMB 352.1 million ($54.6 million) were 10.1% of revenue. This compares to operating expenses of 9.9% of revenue in the year-ago quarter, and 11.4% of revenue in the fourth quarter of 2015.

Operating profit was RMB 223.3 million ($34.6 million), compared to RMB 149.6 million ($23.2 million) in the year-ago quarter, and RMB 260.1 million ($40.3 million) in the fourth quarter of 2015. Operating margin was 6.4%, compared with 6.2% in the prior year period and 5.7% in the previous quarter.

Interest expense was RMB 67.3 million ($10.4 million), compared to RMB 66.6 million ($10.3 million) in the year-ago quarter, and RMB 66.0 million ($10.2 million) in the fourth quarter of 2015.

The change in fair value of warrant derivatives was positive RMB 23.4 million ($3.6 million), compared with negative RMB 13.9 million ($2.2 million) in the year-ago quarter, and positive RMB 14.0 million ($2.2 million) in the fourth quarter of 2015. The warrants were issued on August 16, 2013 in conjunction with the Company’s $96 million registered direct offering.

Earnings per diluted ADS were RMB 2.74 ($0.43), compared to earnings per diluted ADS of RMB 0.59 ($0.09) in the year-ago quarter, and earnings per diluted ADS of RMB 3.39 ($0.53) in the fourth quarter of 2015.

Liquidity

As of March 31, 2016, the Company had cash and cash equivalents of RMB 2.3 billion ($362.1 million), and total working capital of RMB 2.3 billion ($361.3 million). Total short-term borrowings were RMB 2.2 billion ($339.5 million). Total long-term borrowings were RMB 3.2 billion ($499.1 million), of which RMB 576.7 million ($89.4 million) were due in one year.

Business Outlook

For the second quarter of 2016, the Company expects total cell and module shipments to be in the range of 1,400 to 1,500 MW, including approximately 100 MW of module shipments to the Company’s downstream projects. For the full year, the Company reiterates its prior shipment guidance of 5.2 to 5.5 GW, including 250 to 300 MW of module shipments to the Company’s downstream projects. Revenues will not be recognized for the modules shipped to the Company’s downstream projects as required by U.S. GAAP.

Investor Conference Call / Webcast Details

JA Solar's management will host an earnings conference call on May 27, 2016 at 8:00 a.m. U.S. Eastern Time (8:00 p.m. China Time).

Dial-in details for the earnings conference call are as follows:

Phone NumberToll-Free Number
United States+1 8456750437+1 8665194004
Hong Kong+852 30186771+852 800906601
Mainland China+86 8008190121
+86 4006208038
Other International+65 67135090

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call. The passcode is “JA Solar".

A replay of the conference call may be accessed by phone at the following numbers until June 4, 2016. To access the replay, please reference the conference ID 13678460.

Phone NumberToll-Free Number
United States+1 6462543697+1 8554525696
Hong Kong+852 30512780+852 800963117
Mainland China+86 8008700206
+86 4006322162
Other International+61 281990299

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 March 31, 2016, which was RMB 6.448 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 March 31, 2016, 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 "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 20-F 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 power products that convert sunlight into electricity for residential, commercial, and utility-scale power generation. The Company is one of the world’s largest producers of solar power products. Its standard and high-efficiency product offerings are among the most powerful and cost-effective in the industry. The Company distributes products under its own brand and also produces on behalf of its clients. The Company shipped 4.0 GW of solar power products in 2015. JA Solar is headquartered in Beijing, China, and maintains production facilities in Shanghai, Hebei, Jiangsu and Anhui provinces in China, as well as Penang, Malaysia.

For more information, please visit www.jasolar.com.

1 JA Solar adjusts net income attributable to the Company's ordinary shareholders to exclude (1) changes in fair value of certain warrants granted to certain investors in a registered direct offering (the "Offering") closed on August 16, 2013, and (2) fair value of such warrants exceeding net proceeds from the Offering.


JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
(Unaudited)
For three months ended
Mar. 31, 2015Dec. 31, 2015Mar. 31, 2016Mar. 31, 2016
RMB'000RMB'000RMB'000USD'000
Net revenues 2,403,354 4,594,447 3,469,714 538,107
Cost of sales (2,016,660) (3,810,358) (2,894,352) (448,876)
Gross profit/(loss) 386,694 784,088 575,362 89,231
Selling, general and administrative expenses (197,982) (482,409) (312,475) (48,461)
Impairment loss for property, plant and equipment 0 0 0 0
Research and development expenses (39,070) (41,536) (39,599) (6,141)
Total operating expenses (237,052) (523,946) (352,074) (54,602)
Income/(loss) from operations 149,642 260,143 223,288 34,629
Interest expense (66,596) (66,018) (67,273) (10,433)
Change in fair value of derivatives (13,894) 13,997 23,447 3,636
Other (loss)/income (21,882) 33,754 16,281 2,525
Income/(loss) before income taxes 47,270 241,876 195,742 30,357
Income tax (expenses)/benefit (12,295) (56,995) (37,769) (5,857)
Net income/(loss) from continuing operations 34,975 184,881 157,973 24,500
Net income/(loss) from discontinued operations 0 0 0 0
Net income/(loss) 34,975 184,881 157,973 24,500
Fair value of warrants exceeding net proceeds 0 0 0
Less: Loss/(income) attributable to noncontrolling interest (554) (8,581) 1,317 204
Net income/(loss) available to ordinary shareholders 35,529 193,462 156,656 24,295
Net income/(loss) per share:
Basic 0.12 0.68 0.55 0.09
Diluted 0.12 0.68 0.55 0.09
Weighted average number of shares outstanding:
Basic 248,740,690 234,281,009 234,290,842 234,290,842
Diluted 249,002,930 234,510,474 234,521,962 234,521,962


JA Solar Holdings Co., Ltd.
Condensed Consolidated Balance Sheets
(Unaudited)
Dec. 31,Mar. 31,
201520162016
RMB'000RMB'000USD'000
ASSETS
Current assets:
Cash and cash equivalents 2,883,294 2,334,900 362,112
Restricted cash 663,518 975,247 151,248
Accounts receivable 2,872,775 2,710,907 420,426
Notes receivable 837,711 352,805 54,715
Inventories 1,660,543 2,723,015 422,304
Advances to suppliers 473,310 421,064 65,301
Project asset - - -
Other current assets 633,354 845,189 131,078
Total current assets 10,024,505 10,363,128 1,607,185
Property and equipment, net 4,365,348 4,729,587 733,497
Project asset 1,028,615 1,533,622 237,845
Advances to suppliers 195,341 172,864 26,809
Prepaid land use rights 428,495 437,658 67,875
Long-term investment 55,169 60,555 9,391
Other long term assets 208,430 230,908 35,811
Total assets 16,305,903 17,528,323 2,718,412
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Short-term borrowings 2,194,957 2,189,252 339,524
Accounts payable 2,389,467 2,982,345 462,522
Advances from customers 691,867 634,585 98,416
Long term liabilities due in one year 238,400 576,701 89,439
Convertible Bond - - -
Derivative liabilities-current 71,237 47,435 7,357
Accrued and other liabilities 1,588,884 1,603,200 248,635
Total current liabilities 7,174,812 8,033,517 1,245,893
Convertible Bond - - -
Derivative liabilities-non current - - -
Long-term borrowings 2,461,017 2,641,239 409,621
Other long term liabilities 752,925 777,941 120,648
Total liabilities 10,388,755 11,452,698 1,776,163
Total JA Solar Holdings shareholders' equity 5,819,695 5,976,655 926,901
Noncontrolling interest 97,453 98,970 15,349
Total shareholders' equity 5,917,148 6,075,625 942,250
Total liabilities and shareholders’ equity 16,305,903 17,528,323 2,718,412


Contact: The Blueshirt Group China Gary Dvorchak, CFA Phone: +86 (138) 1079-1480 Email: gary@blueshirtgroup.com U.S. Ralph Fong Phone: +1 (415) 489-2195 Email: ralph@blueshirtgroup.com

Source:JA Solar Holdings Co., Ltd.