JA Solar Announces Third Quarter 2015 Results

Published on 23 Nov 2015
JA Solar 
JA Solar Holdings Co., Ltd. today announced its unaudited financial results for its third quarter ended September 30, 2015.

Third Quarter 2015 Highlights

- Total shipments were 1,126.8MW, an increase of 43.5% y/y and 42.5% sequentially

- Shipments of modules and module tolling were 1,073.8MW, an increase of 54.8% y/y and 49.7% sequentially

- Shipments of cells and cell tolling were 53.0MW, a decrease of 42.3% y/y and 27.8% sequentially

- Net revenue was RMB 3.8 billion ($601.0 million), an increase of 26.4% y/y and 41.0% sequentially

- Gross margin was 17.7%, an increase of 270 basis points y/y and 130 basis points sequentially

- Operating profit was RMB 299.1 million ($47.1 million), compared to RMB 189.6 million ($29.8 million) in the third quarter of 2014, and RMB 156.1 million ($24.6 million) in the second quarter of 2015

- Net income was RMB 258.6 million ($40.7 million), compared to RMB 155.4 million ($24.5 million) in the third quarter of 2014, and RMB 136.0 million ($21.4 million) in the second quarter of 2015

- Earnings per diluted ADS were RMB 4.42 ($0.70), compared to RMB 2.55 ($0.40) in the third quarter of 2014, and RMB 2.26 ($0.36) in the second quarter of 2015

- Cash and cash equivalents were RMB 1.8 billion ($289.4 million), an increase of RMB 90.6 million ($14.3 million) during the quarter

- Non-GAAP earnings1 per diluted ADS were RMB 4.35 ($0.68), compared to RMB 1.30 ($0.20) in the third quarter of 2014, and RMB 1.67 ($0.26) in the second quarter of 2015

Mr. Baofang Jin, chairman and CEO of JA Solar, commented, "We are pleased to report strong financial results for the third quarter of 2015 as total shipments of 1.1GW exceeded the high end of our previous expectations. Strong demand in China continued to drive shipment growth, as China represented 53% of our total shipments during the quarter. We also made great progress on our new cell manufacturing facility in Malaysia during the quarter, and are very excited to have announced the facility's launch in late October.

"Due to relatively strong demand in the second half, we have allocated additional shipments from our downstream projects to meet customer demand. As a result, we now expect shipments to our own downstream projects to be under 100MW in 2015.

"As we continue into the final quarter of 2015, we expect demand to remain strong in our key markets, especially China. Although we expect ASPs to remain stable, rising wafer prices may pressure margins slightly in the remainder of the year. We also continue to focus on capturing greater market share in the Americas, and are very pleased with the addition of Mr. Robert Petrina to our management team as we enhance our presence in the U.S. Growing our market share in the U.S. and several emerging markets remains our focus to drive growth in the remainder of the year and beyond."

Third Quarter 2015 Financial Results

All shipment and financial figures refer to the quarter ended September 30, 2015, unless otherwise specified. All "year over year" or "y/y" comparisons are against the quarter ended September 30, 2014. All "sequential" comparisons are against the quarter ended June 30, 2015.

Total shipments were 1,126.8MW, above the high end of the previously announced guidance of 900MW to 950MW. Shipments grew 43.5% year-over-year and 42.5% sequentially.


Net revenue was RMB 3.8 billion ($601.0 million), an increase of 26.4% y/y and 41.0% sequentially. Growth was mainly driven by strong shipments to China.

Gross profit of RMB 677.5 million ($106.6 million) increased 49.2% y/y and 52.5% sequentially. Gross margin was 17.7%, which compares to 15.0% in the year-ago quarter, and 16.4% in the second quarter of 2015. The y/y and sequential increase in gross margin was primarily due to continued cost reduction efforts combined with lower polysilicon prices and a stable ASP in key markets, including China.

Total operating expenses were RMB 378.4 million ($59.5 million), compared to RMB 264.6 million ($41.6 million) in the year-ago quarter, and RMB 288.1 million ($45.3 million) in the second quarter of 2015. The increase in total operating expenses was primarily due to an increase in selling costs associated with higher sales during the quarter. As a percentage of net revenue, total operating expenses were 9.9% in the third quarter of 2015, 8.8% in the year-ago quarter, and 10.6% in the second quarter of 2015.

Operating profit was RMB 299.1 million ($47.1 million), compared to RMB 189.6 million ($29.8 million) in the year-ago quarter, and RMB 156.1 million ($24.6 million) in the second quarter of 2015. 

Interest expense was RMB 58.2 million ($9.2 million), compared to RMB 56.7 million ($8.9 million) in the year-ago quarter, and RMB 58.6 million ($9.2 million) in the second quarter of 2015. 

The change in fair value of warrant derivatives was positive RMB 4.4 million ($0.7 million), compared to positive RMB 75.3 million ($11.9 million) in the year-ago quarter, and positive RMB 35.1 million ($5.5 million) in the second quarter of 2015. The warrants were issued on August 16, 2013 in conjunction with the Company's $96 million registered direct offering. The non-cash gain from the change in fair value was mainly due to the higher stock price as of June 30, 2015 when compared with the stock price as of September 30, 2015.

Earnings per diluted ADS were RMB 4.42 ($0.70), compared to earnings per diluted ADS of RMB 2.55 ($0.40) in the year-ago quarter, and earnings per diluted ADS of RMB 2.26 ($0.36) in the second quarter of 2015.

Liquidity

As of September 30, 2015, the Company had cash and cash equivalents of RMB 1.8 billion ($289.4 million), and total working capital of RMB 3.0 billion ($466.0 million). Total short-term borrowings were RMB 2.3 billion ($358.2 million). Total long-term borrowings were RMB 2.6 billion ($403.5 million), of which RMB 217.4 million ($34.2 million) were due in one year.

Business Outlook

For the fourth quarter of 2015, the Company expects total cell and module shipments to be in the range of 1.1GW to 1.2GW. Due to strong customer demand, the Company now expects to ship less than 100MW of modules to its downstream projects in 2015.

Manufacturing Capacity Update

On October 26, 2015, the Company announced the launch of its 400MW solar cell manufacturing facility in Penang, Malaysia.

To meet growing demand for the Company's high quality products, JA Solar plans to further expand its manufacturing capacity and expects an annual production capacity of 1.5GW for wafers, 5.0GW for cells, and 5.0GW for modules by mid 2016.

Share Buyback Update

As of September 30, 2015, the Company has repurchased a total of 2,971,163 of the Company's American Depositary Shares ("ADSs") from the open market pursuant to a board-approved share repurchase program since its buyback announcement on November 18, 2014.


Source: JA Solar
ENF Profiles For Companies Mentioned in This Article

JA Solar (Solar Materials): http://www.enfsolar.com/directory/material/2236
JA Solar (Solar Panels): http://www.enfsolar.com/directory/panel/2236
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