BAODING, China, August 27, 2014 /PRNewswire/ -- Yingli Green Energy Holding Company Limited (NYSE: YGE) ("Yingli Green Energy" or the "Company"), the world's largest vertically integrated photovoltaic manufacturer, known as "Yingli Solar," today announced its unaudited consolidated financial results for the quarter ended June 30, 2014.
Second Quarter 2014 Consolidated Financial and Operating Summary
[1] For convenience purposes, all references to "net loss/income" in this press release, unless otherwise specified, represent "net loss/income attributable to Yingli Green Energy" for all periods presented. |
[2] All non-GAAP measures other than EBITDA exclude, as applicable, share-based compensation, interest expenses related to the changes in the fair value of the interest rate swap and the amortization of the debt discount, the amortization of intangible assets, inventory provision, impairment of long-lived assets and non-cash provision for inventory purchase commitments. EBITDA excludes interest, tax expenses, depreciation and amortization. For further details on non-GAAP measures, please refer to the reconciliation table and a detailed discussion of the Company's use of non-GAAP information set forth elsewhere in this press release. |
"I'm very pleased to report that we delivered another set of solid results in the second quarter of 2014 with an increase of 40.8% in our PV module shipments over the first quarter of 2014, which includes shipments for PV systems to the Company's own downstream power plants in China, and an overall gross margin of 15.6%, well in line with our previous guidance," commented Mr. Liansheng Miao, Chairman and Chief Executive Officer of Yingli Green Energy. "We remain focused on returning to net profitability by improving our operating efficiency, reducing manufacturing costs and optimizing our geographical footprints. In the second quarter, we saw increased demand for Yingli Solar modules from our key markets, such as China, Japan, United Kingdom and other new emerging markets. In particular, our shipments to new emerging markets in the second quarter increased by approximately 18% quarter over quarter while customer base doubled compared with the second quarter of 2013. Our dedicated local team in Japan has obtained notable achievements, which resulted in our shipments to Japan in the first half of 2014 exceeded our total shipments to Japan in 2013."
"In the first half of this year, we are developing in the aggregate 155 MW of downstream projects, some of these projects under construction are expected to be further developed together with our business partners such as China National Nuclear Corporation, Shanghai Sailing Capital Investment Fund and Datong Coal Mine Group Co., Ltd. In the third quarter, we expect to start construction of a total of 168 MW of downstream projects across China."
"Moving back to domestic market, we see large potential for distributed generation PV projects in the second half of 2014 although the growth in demand was slower than expectation in the first half of this year. The National Energy Administration of PRC announced that it planned to issue a notice requiring further efforts to implement the supportive polices for distributed generation PV projects and announced the goal of achieving at least 13 GW of PV capacity to be connected to the grid in 2014. We expect that the demand for PV modules in China market will accelerate in the second half of 2014," Mr. Miao concluded.
Second Quarter 2014 Financial Results
Total Net Revenues
Total net revenues were RMB 3,408.9 million (US$549.5 million) in the second quarter of 2014, compared to RMB 2,686.8 million in the first quarter of 2014 and RMB 3,378.3 million in the second quarter of 2013. Total PV module shipments were 887.9 MW in the second quarter of 2014 (including 71.8 MW shipments for PV systems to the Company's own downstream power plants in China), representing a significant increase of 40.8% from that in the first quarter of 2014. Revenues were not recognized for 71.8 MW of internal shipments as required by U.S. GAAP. The increase of PV module shipments was primarily due to the stronger demand in the global PV markets especially in China, UK and new emerging markets.
Gross Profit and Gross Margin
Overall gross profit was RMB 532.1 million (US$85.8 million) in the second quarter of 2014, significantly improved from RMB 421.3 million in the first quarter of 2014 and RMB 397.5 million in the second quarter of 2013.
Overall gross margin was 15.6% in the second quarter of 2014, slightly down from 15.7% in the first quarter of 2014 and up from 11.8% in the second quarter of 2013. Gross margin for sales of PV modules was 16.2% in the second quarter of 2014, compared to 16.8% in the first quarter of 2014 and 12.5% in the second quarter of 2013.
Operating Expenses
Operating expenses were RMB 618.1 million (US$99.6 million) in the second quarter of 2014, compared to RMB 550.2 million in the first quarter of 2014 and RMB 526.7 million in the second quarter of 2013. The increase of operating expenses was mainly due to the increased selling and marketing expense in line with the Company's increased PV module shipments in this quarter, and partially offset by the decrease of general and administrative expenses.
Operating expenses as a percentage of total net revenues were 18.1% in the second quarter of 2014, compared to 20.5% in the first quarter of 2014 and 15.6% in the second quarter of 2013.
Operating Loss and Margin
Operating loss was RMB 85.9 million (US$13.9 million) in the second quarter of 2014, a significant decrease from RMB 129.0 million in the first quarter of 2014 and RMB 129.2 million in the second quarter of 2013.
Operating margin was negative 2.5% in the second quarter of 2014, compared to negative 4.8% in the first quarter of 2014 and negative 3.8% in the second quarter of 2013.
EBITDA
On an adjusted non-GAAP basis, earnings before interest, tax expenses, depreciation and amortization (EBITDA) were RMB 288.5 million (US$46.5 million) in the second quarter of 2014, compared to EBITDA of RMB 221.9 million in the first quarter of 2014 and negative EBITDA of RMB 198.9 million in the second quarter of 2013.
Interest Expense
Interest expense was RMB 232.4 million (US$37.5 million) in the second quarter of 2014, compared to RMB 252.0 million in the first quarter of 2014 and RMB 224.9 million in the second quarter of 2013. As of June 30, 2014, the Company had an aggregate of RMB 14.9 billion (US$2.4 billion) of bank borrowings and medium-term notes outstanding, which decreased from RMB 15.2 billion as of March 31, 2014. The weighted average interest rate was 6.25% in the second quarter of 2014, compared to 6.42% in the first quarter of 2014 and 6.20% in the second quarter of 2013.
Foreign Currency Exchange Gain (Loss)
Foreign currency exchange gain was RMB 2.8 million (US$0.5 million) in the second quarter of 2014, compared to foreign currency exchange loss of RMB 13.8 million in the first quarter of 2014 and foreign currency exchange gain of RMB 6.5 million in the second quarter of 2013. The foreign currency exchange gain was mainly due to the Company's USD denominated liabilities increased and the appreciation of the RMB against the USD in this quarter.
Income Tax Expense (Benefit)
Income tax expense was RMB 1.2 million (US$0.2 million) in the second quarter of 2014, compared to income tax benefit of RMB 18.6 million in the first quarter of 2014 and RMB 4.2 million in the second quarter of 2013. The income tax expense in this quarter was mainly resulted from the main operating subsidiaries of the Company turning into profitability.
Net Loss
Net loss was RMB 285.2 million(US$46.0 million) in the second quarter of 2014, compared to RMB 341.8 million in the first quarter of 2014 and RMB 320.8 million in the second quarter of 2013. Loss per ordinary share and per ADS was RMB 1.64(US$0.26), compared to RMB 2.18 in the first quarter of 2014 and RMB 2.05 in the second quarter of 2013.
On an adjusted non-GAAP basis, net loss was RMB 275.0 million (US$44.3 million) in the second quarter of 2014, compared to RMB 338.5 million in the first quarter of 2014 and RMB 321.5 million in the second quarter of 2013. Adjusted non-GAAP loss per ordinary share and per ADS was RMB 1.58 (US$0.25) in the second quarter of 2014, compared to RMB 2.16 in the first quarter of 2014 and RMB 2.05 in the second quarter of 2013.
Balance Sheet Analysis
As of June 30, 2014, the Company had RMB 981.5 million (US$158.2 million) in cash and cash equivalents, compared to RMB 1,273.2 million as of March 31, 2014.
As of June 30, 2014, the Company had RMB 1,493.6 million (US$240.8 million) in restricted cash, compared to RMB 1,726.2 million as of March 31, 2014.
As of June 30, 2014, accounts receivable were RMB 4,995.0 million (US$805.2 million), compared to RMB 4,616.4 million as of March 31, 2014. Days sales outstanding were 132 days in the second quarter of 2014, decreased from 155 days in the first quarter of 2014.
As of June 30, 2014, inventory was RMB 2,289.7 million (US$369.1 million), compared to RMB 2,129.9 million as of March 31, 2014. Inventory turnover days was 72 days in the second quarter of 2014, compared to 85 days in the first quarter of 2014.
As of June 30, 2014, accounts payable were RMB 5,418.6 million (US$873.5 million), compared to RMB 5,403.3 million as of March 31, 2014. Days payable outstanding was 170 days in the second quarter of 2014, compared to 215 days in the first quarter of 2014.
As of the date of this press release, the Company had approximately RMB 5,847 million in unutilized short-term lines of credit and RMB 2,033 million committed long-term facility that can be drawn down in the near future. The Company is currently exploring financing options to alleviate near-term pressure on the Company's liquidity and enhance financial flexibility.
Business Outlook for Full Year 2014
Based on current market and operating conditions, estimated production capacity and forecasted customer demand, the Company revises its PV module shipment target to be in the estimated range of 3.6GW to 3.8GW (including 400 to 600MW shipment for PV systems) for fiscal year 2014, which represents an increase of 11.3% to 17.5% compared to fiscal year 2013.
Downstream Development in 2014
Currently, the Company has in the aggregate approximately 1.4 GW of PV projects pipeline at different approval stages across a dozen of provinces in China. During the second quarter of 2014, the Company started construction for two ground-mounted PV plants with a total capacity of 110MW and a distributed generation project of 20MW. Therefore, accumulatively 155 MW of PV projects started construction in the first half of 2014. These PV projects were included in the consolidated financial statements. In the third quarter, the Company plans to start constructions of 168 MW of PV projects located in Hebei, Ningxia, Shanxi, Guangdong and Shandong provinces. Some of these projects are expected to be co-developed with our business partners such as China National Nuclear Corporation, Shanghai Sailing Capital Investment Fund and Datong Coal Mine Group Co., Ltd.
In addition, the Company has manifested an encouraging breakthrough in its overseas PV plants business by expanding its footprints into Poland and Senegal with a strategic alliance with AMB Energia Wytwarzanie to co-develop 30 MW of PV projects in Poland in June and an engineering, procurement and construction ("EPC") contract with Senelec for a 2 MW ground-mounted PV plant in Senegal in July.
Based on the current project development status and the progress of project pipelines, the Company expects to develop approximately 400MW to 600MW of PV projects by the end of 2014.
Non-GAAP Financial Measures
To supplement the financial measures calculated in accordance with GAAP, this press release includes certain non-GAAP financial measures of adjusted gross profit, adjusted gross margin, adjusted operating loss, adjusted operating margin, adjusted net income (loss), adjusted diluted earnings (loss) per ordinary share and per ADS and EBITDA, each of which (other than EBITDA) is adjusted to exclude, as applicable, items related to share-based compensation, interest expense related to the changes in the fair value of the interest-rate swap and the amortization of the debt discount, the amortization of intangible assets, inventory provision, impairment of long-lived assets and non-cash provision for inventory purchase commitments. EBITDA excludes interest, tax expenses, depreciation and amortization. The Company believes excluding these items from its non-GAAP financial measures is useful for its management and investors to assess and analyse the Company's on-going performance as such items are not directly attributable to the underlying performance of the Company's business operations and do not impact its cash earnings. The Company also believes these non-GAAP financial measures are important to help investors understand the Company's current financial performance and future prospects and compare business trends among different reporting periods on a consistent basis. These non-GAAP financial measures should be considered in addition to financial measures presented in accordance with GAAP, but should not be considered as a substitute for, or superior to, financial measures presented in accordance with GAAP. For a reconciliation of each of these non-GAAP financial measures to the most directly comparable GAAP financial measure, please see the financial information included elsewhere in this press release.
Currency Conversion
Solely for the convenience of readers, certain Renminbi amounts have been translated into U.S. dollar amounts at the rate of RMB 6.2036 to US$1.00, the noon buying rate in New York for cable transfers of Renminbi per U.S. dollar as set forth in the H.10 weekly statistical release of the Federal Reserve Board as of June 30, 2014. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollar amounts at such rate, or at any other rate. The percentages stated in this press release are calculated based on Renminbi.
Conference Call
Yingli Green Energy will host a conference call and live webcast to discuss the results at 8:00 AM Eastern Daylight Time (EDT) on August 27, 2014, which corresponds to 8:00 PM Beijing/Hong Kong time on the same day.
The dial-in details for the live conference call are as follows:
-- U.S. Toll Free Number: +1-866-519-4004
-- International Dial-in Number: +1-845-675-0437
-- Passcode: 81625802
A live and archived webcast of the conference call will be available on the Investors section of Yingli Green Energy's website at www.yinglisolar.com. A replay will be available shortly after the call on Yingli Green Energy's website for 90 days.
A replay of the conference call will be available until September 4, 2014 by dialing:
-- U.S. Toll Free Number: +1-855-452-5696
-- International Dial-in Number: +1-646-254-3697
-- Passcode: 81625802
About Yingli Green Energy
Yingli Green Energy Holding Company Limited (NYSE: YGE), known as "Yingli Solar," is the world's largest vertically integrated photovoltaic module supplier in terms of shipment in 2013 based on public information. Yingli Green Energy's manufacturing covers the photovoltaic value chain from ingot casting and wafering through solar cell production and module assembly. Headquartered in Baoding, China, Yingli Green Energy has more than 30 regional subsidiaries and branch offices and has distributed more than 10 GW PV modules to customers worldwide. For more information please visit www.yinglisolar.com and join the conversation on Facebook, Twitter and Weibo.
Safe Harbor Statement
This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends," "plans," "believes," "estimates," "target" and similar statements. Such statements are based upon management's current expectations and current market and operating conditions, and relate to events that involve known or unknown risks, uncertainties and other factors, all of which are difficult to predict and many of which are beyond Yingli Green Energy's control, which may cause Yingli Green Energy's actual results, performance or achievements to differ materially from those in the forward-looking statements. Further information regarding these and other risks, uncertainties or factors is included in Yingli Green Energy's filings with the U.S. Securities and Exchange Commission. Yingli Green Energy does not undertake any obligation to update any forward-looking statement as a result of new information, future events or otherwise, except as required under applicable law.
For further information, please contact:
Qing Miao |
Vice President of Corporate Communications |
Yingli Green Energy Holding Company Limited |
Tel: +86 312 8929787 |
Email: ir@yingli.com |
YINGLI GREEN ENERGY HOLDING COMPANY LIMITED AND SUBSIDIARIES Unaudited Condensed Consolidated Balance Sheets (In thousands)
| ||||||
March 31, 2014 | June 30, 2014 | |||||
RMB | RMB | US$ | ||||
ASSETS | ||||||
Current assets: | ||||||
Cash and cash equivalents | 1,273,172 | 981,516 | 158,217 | |||
Restricted cash | 1,726,199 | 1,493,638 | 240,770 | |||
Accounts receivable, net | 4,616,408 | 4,995,040 | 805,184 | |||
Inventories | 2,129,945 | 2,289,679 | 369,089 | |||
Prepayments to suppliers | 728,356 | 970,160 | 156,387 | |||
Prepaid expenses and other current assets | 1,265,614 | 1,059,874 | 170,848 | |||
Total current assets | 11,739,694 | 11,789,907 | 1,900,495 | |||
Long-term prepayments to suppliers | 794,105 | 699,046 | 112,684 | |||
Property, plant and equipment, net | 12,907,542 | 12,631,421 | 2,036,144 | |||
Project assets | 378,973 | 718,347 | 115,795 | |||
Land use rights | 699,114 | 695,398 | 112,096 | |||
Intangible assets, net | 58,797 | 58,735 | 9,468 | |||
Other assets | 1,004,678 | 1,031,552 | 166,282 | |||
Total assets | 27,582,903 | 27,624,406 | 4,452,964 | |||
TOTAL LIABILITIES AND SHAREHOLDERS' | ||||||
Current liabilities: | ||||||
Short-term bank borrowings, including current | 7,470,398 | 7,629,929 | 1,229,920 | |||
Accounts payable | 5,403,323 | 5,418,591 | 873,459 | |||
Other current liabilities and accrued expenses | 2,220,984 | 2,147,609 | 346,187 | |||
Total current liabilities | 15,094,705 | 15,196,129 | 2,449,566 | |||
Long-term debt, excluding current portion | 3,796,607 | 3,402,335 | 548,445 | |||
Medium-term notes | 3,912,655 | 3,910,655 | 630,385 | |||
Accrued warranty cost, excluding current portion | 647,422 | 679,891 | 109,596 | |||
Other liabilities | 2,386,094 | 2,449,090 | 394,786 | |||
Total liabilities | 25,837,483 | 25,638,100 | 4,132,778 | |||
SHAREHOLDERS'S EQUITY | ||||||
Ordinary shares | 12,252 | 13,791 | 2,223 | |||
Additional paid-in capital | 6,687,175 | 7,213,618 | 1,162,812 | |||
Treasury stock | (127,331) | (127,331) | (20,525) | |||
Accumulated other comprehensive income | 264,525 | 269,934 | 43,512 | |||
Accumulated deficit | (6,692,693) | (6,977,851) | (1,124,807) | |||
Total equity attributable to Yingli Green Energy | 143,928 | 392,161 | 63,215 | |||
Noncontrolling interests | 1,601,492 | 1,594,145 | 256,971 | |||
Total shareholders' equity | 1,745 ,420 | 1,986,306 | 320,186 | |||
Total liabilities and shareholders' equity | 27,582,903 | 27,624,406 | 4,452,964 | |||
YINGLI GREEN ENERGY HOLDING COMPANY LIMITED AND SUBSIDIARIES Unaudited Condensed Statements of Comprehensive Income (In thousands, except for share, ADS, per share and per ADS data)
| ||||||||
Three months ended | ||||||||
June 30, 2013 | March 31, 2014 | June 30, 2014 | ||||||
RMB | RMB | RMB | US$ | |||||
Net revenues: | ||||||||
Sales of PV modules | 3,200,275 | 2,541,831 | 3,248,354 | 523,624 | ||||
Sales of PV systems | 56,630 | 23,963 | 55,864 | 9,005 | ||||
Other revenues | 121,387 | 120,964 | 104,684 | 16,875 | ||||
Total net revenues | 3,378,292 | 2,686,758 | 3,408,902 | 549,504 | ||||
Cost of revenues: | ||||||||
Cost of PV modules sales | (2,801,332) | (2,113,966) | (2,722,706) | (438,891) | ||||
Cost of PV systems sales | (54,723) | (19,632) | (53,834) | (8,678) | ||||
Cost of other revenues | (124,770) | (131,897) | (100,213) | (16,155) | ||||
Total cost of revenues | (2,980,825) | (2,265,495) | (2,876,753) | (463,724) | ||||
Gross profit (loss) | 397,467 | 421,263 | 532,149 | 85,780 | ||||
Selling expenses | (291,204) | (195,857) | (314,272) | (50,660) | ||||
General and administrative expenses | (173,387) | (222,384) | (178,386) | (28,755) | ||||
Research and development expenses | (62,104) | (131,981) | (125,429) | (20,219) | ||||
Provision for inventory purchase commitments | ||||||||
Total operating expenses | (526,695) | (550,222) | (618,087) | (99,634) | ||||
Loss from operations | (129,228) | (128,959) | (85,938) | (13,854) | ||||
Other income (expense): | ||||||||
Interest expense | (224,927) | (251,986) | (232,404) | (37,463) | ||||
Interest income | 5,164 | 2,997 | 9,178 | 1,480 | ||||
Foreign currency exchange gains (losses) | 6,530 | (13,754) | 2,797 | 451 | ||||
Other income | 8,911 | 12,450 | 14,078 | 2,270 | ||||
Loss before income taxes | (333,550) | (379,252) | (292,289) | (47,116) | ||||
Income tax (expense) benefit | 4,176 | 18,577 | (1,213) | (196) | ||||
Net loss | (329,374) | (360,675) | (293,502) | (47,312) | ||||
Less: Loss attributable to the non-controlling interests |
8,528 | 18,917 | 8,344 | 1,346 | ||||
Net loss attributable to Yingli Green Energy | (320,846) | (341,758) | (285,158) | (45,966) | ||||
Weighted average shares and ADSs outstanding | ||||||||
Basic and diluted | 156,585,020 | 156,722,968 | 173,796,737 | 173,796,737 | ||||
Loss per share and per ADS | ||||||||
Basic and diluted | (2.05) | (2.18) | (1.64) | (0.26) | ||||
Net loss | (329,374) | (360,675) | (293,502) | (47,312) | ||||
Other comprehensive income (loss) | ||||||||
Foreign currency exchange translation adjustment, net of nil tax |
21,903 | (14,630) | 745 | 120 | ||||
Cash flow hedging derivatives, net of nil tax | (6,734) | (9,370) | 4,681 | 755 | ||||
Comprehensive loss | (314,205) | (384,675) | (288,076) | (46,437) | ||||
Less: Comprehensive loss attributable to the noncontrolling interest |
10,773 | 13,889 | 8,327 | 1,342 | ||||
Comprehensive loss attributable to Yingli Green Energy | (303,432) | (370,786) | (279,749) | (45,095) | ||||
Reconciliation of Non-GAAP measures to GAAP measures | ||||||||
Three months ended | ||||||||
June 30, 2013 | March 31, 2014 | June 30, 2014 | ||||||
RMB | RMB | RMB | US$ | |||||
Non-GAAP loss attributable to Yingli | (321,455) | (338,539) | (274,978) | (44,325) | ||||
Share-based compensation | (3,543) | (3,110) | (10,208) | (1,646) | ||||
Amortization of intangible assets | (753) | - | - | - | ||||
Inventory provision | - | - | - | - | ||||
Impairment of long-lived assets | - | - | - | - | ||||
Provision for inventory purchase commitments | - | - | - | - | ||||
Interest expenses consisting of changes in | 4,905 | (109) | 28 | 5 | ||||
Net loss attributable to Yingli Green | (320,846) | (341,758) | (285,158) | (45,966) | ||||
Non-GAAP diluted loss per share and per | (2.05) | (2.16) | (1.58) | (0.25) | ||||
Diluted loss per share and per ADS | (2.05) | (2.18) | (1.64) | (0.26) | ||||
| ||||||||
Three months ended | ||||||||
June 30, 2013 | March 31, 2014 | June 30, 2014 | ||||||
RMB | RMB | RMB | US$ | |||||
Income before income taxes and | (333,550) | (379,252) | (292,289) | (47,116) | ||||
Interest expense | 224,927 | 251,986 | 232,404 | 37,462 | ||||
Accumulated depreciation | 301,054 | 343,590 | 342,784 | 55,256 | ||||
Amortization for intangible assets | 6,472 | 5,576 | 5,582 | 900 | ||||
EBITDA | 198,903 | 221,900 | 288,481 | 46,502 | ||||
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