CHONGQING, China, Nov. 14, 2017 /PRNewswire/ -- Daqo New Energy
Corp. (NYSE: DQ) ("Daqo New Energy", the "Company" or "we"), a
leading manufacturer of high-purity polysilicon for the global
solar PV industry, today announced its unaudited financial results
for the third quarter of 2017.
Third Quarter 2017 Financial and Operating Highlights
- Polysilicon production volume of 4,940 MT in Q3 2017, compared
to 4,993 MT in Q2 2017
- Polysilicon external sales volume(1) of 4,500 MT in
Q3 2017, increasing from 4,497 MT in Q2 2017
- Polysilicon average total production cost(2) of
$8.95/kg in Q3 2017, compared to
$8.53/kg in Q2 2017
- Polysilicon average cash cost(2) of $7.16/kg in Q3 2017, compared to $6.77/kg in Q2 2017
- Average selling price (ASP) of polysilicon was $16.19/kg in Q3 2017, increasing from
$13.58/kg in Q2 2017
- Solar wafer sales volume of 26.4 million pieces in Q3 2017,
compared to 27.0 million pieces in Q2 2017
- Revenue of $89.4 million in Q3
2017, increasing from $76.0 million
in Q2 2017
- Gross profit of $36.4 million in
Q3 2017, increasing from $24.2
million in Q2 2017
- Gross margin of 40.8% in Q3 2017, increasing from 31.9% in Q2
2017
- Non-GAAP gross margin(3) of 41.3% in Q3 2017,
increasing from 32.6% in Q2 2017
- EBITDA (non-GAAP)(3) of $42.3
million in Q3 2017, increasing from $29.8 million in Q2 2017
- EBITDA margin (non-GAAP)(3) of 47.4% in Q3 2017,
increasing from 39.2% in Q2 2017
- Net income attributable to Daqo New Energy shareholders of
$24.1 million in Q3 2017, increasing
from $12.1 million in Q2 2017 and
$11.2 million in Q3 2016
- Earnings per basic ADS of $2.28
in Q3 2017, increasing from $1.15 in
Q2 2017 and $1.07 in Q3 2016
- Adjusted net income (non-GAAP)(3) attributable to
Daqo New Energy shareholders of $25.6
million in Q3 2017, increasing from $13.8 million in Q2 2017 and $13.2 million in Q3 2016
- Adjusted earnings per basic ADS (non-GAAP)(3) of
$2.42 in Q3 2017, increasing from
$1.31 in Q2 2017 and $1.26 in Q3 2016
Three months
ended
|
US$ millions
except
as indicated otherwise
|
Sep. 30,
2017
|
Jun. 30,
2017
|
Sep. 30,
2016
|
Revenues
|
89.4
|
76.0
|
54.3
|
Gross
profit
|
36.4
|
24.2
|
20.1
|
Gross
margin
|
40.8%
|
31.9%
|
37.1%
|
Operating
income
|
32.8
|
20.2
|
16.4
|
Net income
attributable to
Daqo New Energy Corp. shareholders
|
24.1
|
12.1
|
11.2
|
Earnings per basic ADS
($ per ADS)
|
2.28
|
1.15
|
1.07
|
Adjusted net income
(non-GAAP)(3)
attributable to Daqo New Energy Corp.
shareholders
|
25.6
|
13.8
|
13.2
|
Adjusted earnings per
basic ADS
(non-GAAP)(3) ($ per ADS)
|
2.42
|
1.31
|
1.26
|
Non-GAAP gross
profit(3)
|
36.9
|
24.8
|
21.6
|
Non-GAAP gross
margin(3)
|
41.3%
|
32.6%
|
39.9%
|
EBITDA
(non-GAAP)(3)
|
42.3
|
29.8
|
25.0
|
EBITDA
margin(3) (non-GAAP)
|
47.4%
|
39.2%
|
46.0%
|
Polysilicon sales
volume (MT) (1)
|
4,500
|
4,497
|
2,838
|
Polysilicon production
cost ($/kg)(2)
|
8.95
|
8.53
|
8.66
|
Polysilicon cash cost
(excl. dep'n) ($/kg)(2)
|
7.16
|
6.77
|
6.88
|
Notes:
|
(1) Our
polysilicon external sales volume excludes internal sales to our
Chongqing wafer manufacturing subsidiary, which utilizes
polysilicon as raw material for the production of solar wafers. The
sales volume is the quantity of goods that have been received by
customers, and thus the corresponding revenue has been recognized
during the period indicated.
|
(2)
Production cost and cash cost only refer to production in our
Xinjiang polysilicon facilities. Production cost is calculated by
the inventoriable costs relating to production of polysilicon in
Xinjiang divided by the production volume in the period indicted.
Cash cost is calculated by the inventoriable costs relating to
production of polysilicon excluding depreciation expense in
Xinjiang, divided by the production volume in the period
indicated.
|
(3) Daqo
New Energy provides non-GAAP gross profit, non-GAAP gross margin,
EBITDA, EBITDA margin, adjusted net income (loss) attributable to
Daqo New Energy Corp. shareholders and adjusted earnings (loss) per
ADS on a non-GAAP basis to provide supplemental information
regarding its financial performance. For more information on these
non-GAAP financial measures, please see the section captioned "Use
of Non-GAAP Financial Measures" and the tables captioned
"Reconciliation of non-GAAP financial measures to comparable US
GAAP measures" set forth at the end of this press
release.
|
Commentary
"We are pleased to report strong financial and operating results
for the third quarter of 2017. I would like to thank our
entire team for their great work and contribution to the solid
profitability and earnings for the third quarter. Our
excellent third quarter results demonstrate the robust customer
demand for our high quality polysilicon products. During the
third quarter, we produced 4,940 MT of polysilicon and sold 4,500
MT to external customers. Revenues for the third quarter were
$89.4 million, an increase of 17.6%
from the prior quarter. Third quarter earnings per basic ADS
were $2.28, an increase of 98%
compared to $1.15 in the prior
quarter. During the third quarter of 2017, the company
generated $24.1 million in net income
attributable to Daqo New Energy shareholders and $42.3 million in EBITDA with an EBITDA margin of
47.4%. In particular, our operating cash flow remains
strong. In the first three quarters of 2017, we generated
$98.4 million in net cash provided by
operating activities," said Dr. Gongda Yao, Chief Executive Officer
of Daqo New Energy.
"In late September and early October, we conducted annual
maintenance for our Xinjiang polysilicon facilities. We are
glad to report that the annual maintenance had been completed
successfully for this year, with less impact to production volume
than anticipated by our original plan. For this year, rather
than shutting down the entire facility for maintenance as we had
done in previous years, we conducted maintenance in two phases with
partial shutdown of the facility. While this was the first
time we made partial shutdown for annual maintenance, through the
hard work and dedication of our team, maintenance was completed
ahead of schedule and allowed for increased production during the
same period. Furthermore, through the maintenance and related
technology upgrades, we have successfully expanded our
hydrochlorination capacity and manufacturing efficiency, which lays
a solid ground for potential production increase and cost reduction
in the following quarters."
"Demand in China remained
strong in the third the quarter, driven by Top Runner and PV
Poverty Alleviation projects, as well as distributed generation
projects, which have provided strong support for demand during the
second half of the year. According to industry sources,
China has added approximately 42GW
of solar PV installation in the first three quarters of 2017, which
is much stronger than most forecasts. It is expected that the total
annual solar PV installation in China will likely reach 50GW in 2017, which
represents an approximate 40% increase compared to 2016. In
addition, the United States is
expected to install approximately 12GW in 2017 and India is expected to take over Japan to become the third largest solar PV
installation market with approximately 10GW installation in 2017.
Based on the strong end market demand, we anticipate global
annual solar PV installation would grow in the double-digit rate in
2017 as compared to 2016."
"As a result of strong downstream PV market, the market remained
short-supplied and polysilicon pricing increased throughout the
third quarter. Our third quarter polysilicon ASP were
$16.19/kg, representing a significant
increase from the second quarter's ASP of $13.58/kg. As of today, we continue to see
robust customer demand for our high quality polysilicon, with
pricing in the approximate range of $18.50/kg."
"Polysilicon average total production cost was $8.95/kg in the third quarter, compared to
$8.53/kg in the prior quarter.
The increase in production cost was primarily due to costs related
to our annual maintenance, as well as exchange rate related impact
and higher raw material cost."
"In October, our board of directors officially approved the
Company's Phase 3B Project, which is expected to increase our
polysilicon annual capacity from 18,000 MT to 25,000 MT. By
adopting additional technology improvement and debottlenecking
projects, we may be able to further increase our capacity to 30,000
MT per annum by the end of 2019. Once Phase 3B Project is ramped up
to full production capacity, we anticipate the overall total
production cost for our Xinjiang facilities could potentially be
decreased to $7.50/kg, benefiting
from better operating leverage, adopting new production processes
and equipment with higher efficiencies, and achieving greater
economies of scale."
"For the Phase 3B Project, we will adopt new designs, processes,
technologies and equipment that would further improve the purity of
our polysilicon products. Polysilicon produced under the
Phase 3B Project are expected to reach electronics grade and will
be targeting the mono-crystalline wafer and semiconductor markets.
We may potentially enjoy higher profit margin if we could
successfully access these markets with our differentiated
electronic-grade polysilicon products. "
Outlook and Q4 2017 guidance
The Company continued to conduct its annual maintenance for the
Xinjiang polysilicon facility in October, 2017, with some impact to
production. As a result, the Company expects to produce 4,800
MT to 5,000 MT of polysilicon and sell approximately 4,300 MT to
4,500 MT to external customers during the fourth quarter of 2017.
The above external sales guidance excludes shipments of polysilicon
to be used internally by our Chongqing solar wafer facility, which utilizes
polysilicon for its wafer manufacturing operation. Wafer
sales volume is expected to be approximately 25.0 million to 25.5
million pieces in the fourth quarter of 2017.
This outlook reflects our current and preliminary view as of the
date of this press release and may be subject to change. Our
ability to achieve these projections is subject to risks and
uncertainties. See "Safe Harbor Statement" at the end of this press
release.
Third Quarter 2017 Results
Revenues
Revenues were $89.4 million,
increasing from $76.0 million in the
second quarter of 2017 and $54.3
million in the third quarter of 2016.
Revenues from polysilicon sales to external customers were
$72.9 million, increasing from
$61.1 million in the second quarter
of 2017 and $44.4 million in the
third quarter of 2016. External polysilicon sales volume was 4,500
MT, increasing from 4,497 MT in the second quarter of 2017 and
2,838 MT in the third quarter of 2016. The average selling price
(ASP) of polysilicon was $16.19/kg in
the third quarter of 2017, increasing from $13.58/kg
in the second quarter of 2017. The increase in polysilicon revenues
as compared to the second quarter of 2017 was primarily due to
higher ASPs and slightly higher sales volume.
Revenues from wafer sales were $16.5
million, increasing from $14.9
million in the second quarter of 2017 and $9.9 million in the third quarter of 2016. Wafer
sales volume was 26.4 million pieces, compared to 27.0 million
pieces in the second quarter of 2017 and 14.4 million pieces in the
third quarter of 2016.
Gross profit and margin
Gross profit was approximately $36.4
million, increasing from $24.2
million in the second quarter of 2017 and $20.1 million in the third quarter of 2016.
Non-GAAP gross profit, which excludes costs related to the
non-operational polysilicon assets in Chongqing, was approximately $36.9 million, increasing from $24.8 million in the second quarter of 2017 and
$21.6 million in the third quarter of
2016.
Gross margin was 40.8%, increasing from 31.9% in the second
quarter of 2017 and 37.1% in the third quarter of 2016.
In the third quarter of 2017, total costs related to the
non-operational Chongqing
polysilicon assets including depreciation were $0.5 million, compared to $0.5 million in the second quarter of 2017 and
$1.5 million in the third quarter of
2016. Excluding costs related to the non-operational Chongqing polysilicon assets, the non-GAAP
gross margin was approximately 41.3%, increasing from 32.6% in the
second quarter of 2017 and 39.9% in the third quarter of 2016.
Selling, general and administrative expenses
Selling, general and administrative expenses were $4.4 million, compared to $4.5 million in the second quarter of 2017 and
$4.9 million in the third quarter of
2016.
Research and development expenses
Research and development expenses were approximately
$0.1 million, compared to
$0.3 million in the second quarter of
2017 and $1.0 million in the third
quarter of 2016. The research and development expenses vary from
period to period reflecting the R&D activities that occur in
such period.
Other operating income
Other operating income was $0.8
million, compared to $0.8
million in the second quarter of 2017 and $2.2 million in the third quarter of 2016. Other
operating income was mainly composed of unrestricted cash
incentives that the Company received from local government
authorities, the amount of which varies from period to period.
Operating income and margin
As a result of the foregoing, operating income was $32.8 million, increasing from $20.2 million in the second quarter of 2017 and
$16.4 million in the third quarter of
2016.
Operating margin was 36.7%, increasing from 26.6% in the second
quarter of 2017 and 30.3% in the third quarter of 2016.
Interest expense
Interest expense was $4.3 million,
compared to $5.3 million in the
second quarter of 2017 and $3.1
million in the third quarter of 2016.
EBITDA
EBITDA was $42.3 million,
increasing from $29.8 million in the
second quarter of 2017 and $25.0
million in the third quarter of 2016. EBITDA margin was
47.4%, increasing from 39.2% in the second quarter of 2017 and
46.0% in the third quarter of 2016.
Net income attributable to Daqo New Energy Corp.
shareholders and earnings per ADS
Net income attributable to Daqo New Energy Corp. shareholders
was $24.1 million in the third
quarter of 2017, increasing from $12.1
million in the second quarter of 2017 and $11.2 million in the third quarter of 2016.
Earnings per basic ADS were $2.28
in the third quarter of 2017, increasing from $1.15 in the second quarter of 2017 and
$1.07 in the third quarter of
2016.
Financial Condition
As of September 30, 2017, the
Company had $61.6 million in cash and
cash equivalents and restricted cash, compared to $49.8 million as of June
30, 2017 and $29.2 million as
of September 30, 2016. As of
September 30, 2017, the accounts
receivable balance was $4.6 million,
compared to $3.8 million as of
June 30, 2017. As of September 30, 2017, the notes receivable balance
was $25.3 million, compared to
$10.5 million as of June 30, 2017. As of September 30, 2017, total borrowings were
$216.8 million, of which $119.3 million were long-term borrowings,
compared to total borrowings of $219.3
million, including $123.1
million long-term borrowings, as of June 30, 2017.
Cash Flows
For the nine months ended September 30,
2017, net cash provided by operating activities was
$98.4 million, increasing from
$70.9 million in the same period of
2016.
For the nine months ended September 30,
2017, net cash used in investing activities was $45.0 million, compared to $51.2 million in the same period of 2016. The net
cash used in investing activities in 2017 was primarily related to
the capital expenditure of Xinjiang Phase 3A polysilicon
projects.
For the nine months ended September 30,
2017, net cash used in financing activities was $29.6 million, compared to $12.3 million in the same period of 2016. The
increase was primarily due to repayment of related parties loans
and bank borrowings.
Use of Non-GAAP Financial Measures
To supplement Daqo New Energy's consolidated financial results
presented in accordance with United States Generally Accepted
Accounting Principles ("US GAAP"), the Company uses certain
non-GAAP financial measures that are adjusted for certain items
from the most directly comparable US GAAP measures including
non-GAAP gross profit and non-GAAP gross margin; earnings before
interest, taxes, depreciation and amortization ("EBITDA") and
EBITDA margin; adjusted net income attributable to Daqo New Energy
Corp. shareholders and adjusted earnings per basic ADS.
Management believes that each of these non-GAAP measures is useful
to investors, enabling them to better assess changes in key
elements of the Company's results of operations across different
reporting periods on a consistent basis, independent of certain
items as described below. Thus, management believes that, used in
conjunction with US GAAP financial measures, these non-GAAP
financial measures provide investors with meaningful supplemental
information to assess the Company's operating results in a manner
that is focused on its ongoing, core operating performance.
Management uses these non-GAAP measures internally to assess the
business, its financial performance, current and historical
results, as well as for strategic decision-making and forecasting
future results. Given management's use of these non-GAAP
measures, the Company believes these measures are important to
investors in understanding the Company's operating results as seen
through the eyes of management. These non-GAAP measures are
not prepared in accordance with US GAAP or intended to be
considered in isolation or as a substitute for the financial
information prepared and presented in accordance with US GAAP; the
non-GAAP measures should be reviewed together with the US GAAP
measures and may be different from non-GAAP measures used by other
companies.
Non-GAAP gross profit and non-GAAP gross margin includes
adjustments for costs related to the non-operational polysilicon
assets in Chongqing. Such costs
mainly consist of non-cash depreciation costs, as well as utilities
and maintenance costs associated with the temporarily idle
polysilicon machinery and equipment, which will be or are in the
process of being relocated to the Company's Xinjiang polysilicon
manufacturing facility. The Company expects a majority of these
costs, such as depreciation, will continue to occur as part of the
production cost at the Xinjiang facilities subsequent to the
completion of the relocation plan. Once these assets are placed
back in service, the Company will remove this adjustment from the
non-GAAP reconciling item. The Company also 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 Daqo
New Energy Corp. shareholders and adjusted earnings per basic ADS
exclude costs related to the non-operational polysilicon assets in
Chongqing as described
above. Adjusted net income attributable to Daqo New Energy
Corp. shareholders and adjusted earnings per basic ADS also exclude
costs related to share-based compensation. Share-based compensation
is a non-cash expense that varies from period to period. As a
result, management excludes this item from its internal operating
forecasts and models. Management believes that this adjustment for
share-based compensation provides investors with a basis to measure
the company's core performance, including compared with the
performance of other companies, without the period-to-period
variability created by share-based compensation.
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 U.S. Eastern Time
on November 14, 2017 (9:00 PM Beijing / Hong
Kong time on the same day).
The dial-in details for the earnings conference call are as
follows:
Participant dial in
(U.S. toll free):
|
+1-888-346-8982
|
Participant
international dial in:
|
+1-412-902-4272
|
China mainland toll
free:
|
4001-201203
|
Hong Kong toll
free:
|
800-905945
|
Hong Kong local dial
in:
|
+852-301-84992
|
Participants please ask to be joined into the Daqo New Energy
Corp. call. Please dial in 10 minutes before the call is scheduled
to begin.
You can also listen to the conference call via Webcast through
the URL:
http://mms.prnasia.com/DQ/20171114/default.aspx
A replay of the call will be available 1 hour after the
conclusion of the conference call through November 21, 2017.
The dial in details for the conference call replay are as
follows:
U.S. toll
free:
|
+1-877-344-7529
|
International dial
in:
|
+1-412-317-0088
|
Canada toll
free:
|
855-669-9658
|
Replay access
code:
|
10114182
|
To access the replay using 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 Daqo New Energy Corp.
Founded in 2008, Daqo New Energy Corp. (NYSE: DQ) is a leading
manufacturer of high-purity polysilicon for the global solar PV
industry. As one of the world's lowest cost producers of
high-purity polysilicon and solar wafers, the Company primarily
sells its products to solar cell and solar module manufacturers.
The Company has built a manufacturing facility that is technically
advanced and highly efficient with a nameplate capacity of 18,000
metric tons in Xinjiang, China. The Company also operates a
solar wafer manufacturing facility in Chongqing, China.
Safe Harbor Statement
This announcement contains forward-looking statements. These
statements are made under the "safe harbor" provisions of 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" and similar statements. Among other things,
the outlook for the fourth quarter of 2017 and quotations from
management in this announcement, as well as Daqo New Energy's
strategic and operational plans, contain forward-looking
statements. The Company may also make written or oral
forward-looking statements in its reports filed or furnished to the
U.S. Securities and Exchange Commission, in its annual reports to
shareholders, in press releases and other written materials and in
oral statements made by its officers, directors or employees to
third parties. Statements that are not historical facts, including
statements about the Company's beliefs and expectations, are
forward-looking statements. Forward-looking statements involve
inherent risks and uncertainties. A number of factors could cause
actual results to differ materially from those contained in any
forward-looking statement, including but not limited to the
following: the demand for photovoltaic products and the development
of photovoltaic technologies; global supply and demand for
polysilicon; alternative technologies in cell manufacturing; our
ability to significantly expand our polysilicon production capacity
and output; the reduction in or elimination of government subsidies
and economic incentives for solar energy applications; and our
ability to lower our production costs. Further information
regarding these and other risks is included in the reports or
documents we have filed with, or furnished to, the Securities and
Exchange Commission. Daqo New Energy does not undertake any
obligation to update any forward-looking statement, except as
required under applicable law. All information provided in this
press release and in the attachments is as of the date of this
press release, and Daqo New Energy undertakes no duty to update
such information, except as required under applicable law.
Daqo
New Energy Corp.
|
Unaudited
Consolidated Statement of Operations and Comprehensive
Income
|
(US dollars in
thousands, except ADS and per ADS data)
|
|
|
|
For the three
months Ended
|
|
|
Sep 30,
2017
|
|
Jun 30,
2017
|
|
Sep 30,
2016
|
|
|
|
|
|
|
|
Revenues
|
|
$89,366
|
|
$76,002
|
|
$54,289
|
Cost of
revenues
|
|
(52,925)
|
|
(51,757)
|
|
(34,152)
|
Gross
profit
|
|
36,441
|
|
24,245
|
|
20,137
|
Operating
expenses
|
|
|
|
|
|
|
Selling, general and
administrative expenses
|
|
(4,410)
|
|
(4,514)
|
|
(4,858)
|
Research and
development expenses
|
|
(104)
|
|
(279)
|
|
(997)
|
Other operating
income
|
|
841
|
|
751
|
|
2,166
|
Total operating
expenses
|
|
(3,673)
|
|
(4,042)
|
|
(3,689)
|
Income from
operations
|
|
32,768
|
|
20,203
|
|
16,448
|
Interest
expense
|
|
(4,318)
|
|
(5,288)
|
|
(3,076)
|
Interest
income
|
|
117
|
|
111
|
|
123
|
Foreign exchange gain
(loss)
|
|
2
|
|
2
|
|
(1)
|
Income before income
taxes
|
|
28,569
|
|
15,028
|
|
13,494
|
Income tax
expense
|
|
(4,218)
|
|
(2,768)
|
|
(2,163)
|
Net income
|
|
24,351
|
|
12,260
|
|
11,331
|
Net income
attributable to noncontrolling interest
|
|
242
|
|
135
|
|
135
|
Net income
attributable to Daqo New Energy
Corp. shareholders
|
|
$24,109
|
|
$12,125
|
|
$11,196
|
|
|
|
|
|
|
|
Net income
|
|
24,351
|
|
12,260
|
|
11,331
|
Other comprehensive
income (loss):
|
|
|
|
|
|
|
Foreign currency
translation adjustments
|
|
6,004
|
|
4,904
|
|
(882)
|
Total other
comprehensive income (loss)
|
|
6,004
|
|
4,904
|
|
(882)
|
Comprehensive
income
|
|
30,355
|
|
17,164
|
|
10,449
|
Comprehensive income
attributable to
noncontrolling interest
|
|
281
|
|
167
|
|
129
|
Comprehensive income
attributable to Daqo
New Energy Corp. shareholders
|
|
$30,074
|
|
$16,997
|
|
$10,320
|
|
|
|
|
|
|
|
Income per
ADS
|
|
|
|
|
|
|
Basic
|
|
2.28
|
|
1.15
|
|
1.07
|
Diluted
|
|
2.22
|
|
1.14
|
|
1.05
|
Weighted average ADS
outstanding
|
|
|
|
|
|
|
Basic
|
|
10,570,485
|
|
10,529,730
|
|
10,478,671
|
Diluted
|
|
10,874,914
|
|
10,678,845
|
|
10,642,235
|
Daqo New Energy
Corp.
|
|
Unaudited
Consolidated Balance Sheet
|
|
(US dollars in
thousands)
|
|
|
|
|
|
|
Sep 30,
2017
|
|
Jun 30,
2017
|
|
Sep 30,
2016
|
|
|
|
|
|
|
|
|
|
ASSETS:
|
|
|
|
|
|
|
|
Current
Assets:
|
|
|
|
|
|
|
|
Cash and cash
equivalents
|
|
$40,903
|
|
$30,443
|
|
$21,630
|
|
Restricted
cash
|
|
20,657
|
|
19,403
|
|
7,531
|
|
Accounts receivable,
net
|
|
4,612
|
|
3,796
|
|
4,585
|
|
Notes
Receivable
|
|
25,254
|
|
10,540
|
|
17,037
|
|
Prepaid expenses and
other current
assets
|
|
6,959
|
|
7,011
|
|
6,849
|
|
Advances to
suppliers
|
|
3,421
|
|
1,688
|
|
1,805
|
|
Inventories
|
|
17,310
|
|
15,981
|
|
14,905
|
|
Amount due from related
parties
|
|
5,112
|
|
1,386
|
|
1,869
|
|
Total current
assets
|
|
124,228
|
|
90,248
|
|
76,211
|
|
Property, plant and
equipment, net
|
|
558,476
|
|
554,062
|
|
561,324
|
|
Prepaid land use
right
|
|
25,455
|
|
25,125
|
|
25,971
|
|
Deferred tax
assets
|
|
611
|
|
600
|
|
610
|
|
Investment accounted
for under
cost-method
|
|
607
|
|
596
|
|
182
|
|
TOTAL
ASSETS
|
|
709,377
|
|
670,631
|
|
664,298
|
|
|
|
|
|
|
|
|
|
Current
liabilities:
|
|
|
|
|
|
|
|
Short-term borrowings,
including
current portion of long-term
borrowings
|
|
97,527
|
|
96,158
|
|
98,630
|
|
Accounts
payable
|
|
18,446
|
|
20,972
|
|
17,698
|
|
Notes
payable
|
|
29,494
|
|
26,080
|
|
14,440
|
|
Advances from
customers
|
|
16,686
|
|
10,483
|
|
4,189
|
|
Payables for purchases
of property,
plant and equipment
|
|
24,202
|
|
25,839
|
|
43,696
|
|
Accrued expenses and
other current
liabilities
|
|
11,415
|
|
9,426
|
|
8,744
|
|
Amount due to related
parties
|
|
12,177
|
|
12,162
|
|
41,390
|
|
Income tax
payable
|
|
7,951
|
|
6,386
|
|
4,658
|
|
Total current
liabilities
|
|
217,898
|
|
207,506
|
|
233,445
|
|
Long-term
borrowings
|
|
119,312
|
|
123,145
|
|
128,975
|
|
Other long-term
Liabilities
|
|
23,783
|
|
23,509
|
|
24,252
|
|
TOTAL
LIABILITIES
|
|
360,993
|
|
354,160
|
|
386,672
|
|
EQUITY:
|
|
|
|
|
|
|
|
Ordinary
shares
|
|
27
|
|
27
|
|
26
|
|
Treasury
stock
|
|
(1,749)
|
|
(1,749)
|
|
(1,749)
|
|
Additional paid-in
capital
|
|
243,930
|
|
242,372
|
|
239,566
|
|
Retained
earnings
|
|
99,560
|
|
75,451
|
|
36,304
|
|
Accumulated other
comprehensive
income
|
|
4,268
|
|
(1,697)
|
|
1,841
|
|
Total Daqo New Energy
Corp.'s
shareholders' equity
|
|
346,036
|
|
314,404
|
|
275,988
|
|
Noncontrolling
interest
|
|
2,348
|
|
2,067
|
|
1,638
|
|
Total
equity
|
|
348,384
|
|
316,471
|
|
277,626
|
|
TOTAL LIABILITIES
& EQUITY
|
|
709,377
|
|
670,631
|
|
664,298
|
|
|
|
|
|
|
|
|
|
Daqo New Energy
Corp.
|
Unaudited
Consolidated Statements of Cash Flows
|
(US dollars in
thousands)
|
|
|
For the nine months
ended Sep. 30,
|
|
|
2017
|
|
2016
|
|
Operating
Activities:
|
|
|
|
|
|
Net income
|
|
59,762
|
|
39,741
|
|
Adjustments to
reconcile net income to net cash
provided by operating activities:
|
|
|
|
|
|
Share-based compensation
|
|
3,031
|
|
2,260
|
|
Reversal
of allowance for doubtful accounts
|
|
(3)
|
|
(1,063)
|
|
Depreciation of property, plant and equipment
|
|
28,780
|
|
25,727
|
|
Loss/(gain) on disposal of assets
|
|
24
|
|
(188)
|
|
|
|
|
|
|
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
Accounts
receivable
|
|
429
|
|
15,914
|
|
Notes
receivable
|
|
(11,403)
|
|
(6,221)
|
|
Prepaid
expenses and other current assets
|
|
1,387
|
|
5,063
|
|
Advances
to suppliers
|
|
(1,587)
|
|
(804)
|
|
Inventories
|
|
(4,395)
|
|
(4,472)
|
|
Amounts
due from related parties
|
|
(3,356)
|
|
(1,604)
|
|
Amounts
due to related parties
|
|
584
|
|
771
|
|
Prepaid
land use rights
|
|
426
|
|
435
|
|
Accounts
payable
|
|
(1,094)
|
|
669
|
|
Notes
payable
|
|
12,648
|
|
(5,242)
|
|
Accrued
expenses and other current liabilities
|
|
2,672
|
|
355
|
|
Income tax
payable
|
|
2,367
|
|
3,718
|
|
Advances
from customers
|
|
8,643
|
|
(3,778)
|
|
Deferred
government subsidies
|
|
(500)
|
|
(334)
|
|
Net cash provided by
operating activities
|
|
98,415
|
|
70,947
|
|
|
|
|
|
|
|
Investing
activities:
|
|
|
|
|
|
Purchases of property,
plant and equipment
|
|
(40,984)
|
|
(62,044)
|
|
Investment accounted
for under the cost-method
|
|
-
|
|
(188)
|
|
Decrease/(Increase) in
restricted cash
|
|
(3,981)
|
|
11,028
|
|
Net cash used in
investing activities
|
|
(44,965)
|
|
(51,204)
|
|
|
|
|
|
|
|
Financing
activities:
|
|
|
|
|
|
Proceeds from related
party loans
|
|
52,260
|
|
98,535
|
|
Repayment of related
party loans
|
|
(72,329)
|
|
(103,174)
|
|
Proceeds from bank
borrowings
|
|
69,589
|
|
82,146
|
|
Repayment of bank
borrowings
|
|
(79,941)
|
|
(90,742)
|
|
Cash received from
exercises of options
|
|
788
|
|
949
|
|
Net cash used in
financing activities
|
|
(29,633)
|
|
(12,286)
|
|
|
|
|
|
|
|
Effect of exchange
rate changes on cash and cash equivalents
|
|
1,099
|
|
(317)
|
|
Net increase in cash
and cash equivalents
|
|
24,916
|
|
7,140
|
|
Cash and cash
equivalents at the beginning of the period
|
|
15,987
|
|
14,490
|
|
Cash and cash
equivalents at the end of the period
|
|
40,903
|
|
21,630
|
|
Daqo New Energy
Corp.
|
Reconciliation of
non-GAAP financial measures to comparable US GAAP
measures
|
(US dollars in
thousands)
|
|
|
|
For the three
months ended
|
|
|
|
Sep. 30,
2017
|
|
Jun. 30,
2017
|
|
Sep. 30,
2016
|
|
Gross
profit
|
|
36,441
|
|
24,245
|
|
20,137
|
|
Costs related to the
non-operational
Chongqing polysilicon operations
|
|
454
|
|
544
|
|
1,501
|
|
Non-GAAP gross
profit
|
|
36,895
|
|
24,789
|
|
21,638
|
|
|
|
|
|
|
|
For the three
months ended
|
|
|
|
Sep. 30,
2017
|
|
Jun. 30,
2017
|
|
Sep. 30,
2016
|
|
Gross
margin
|
|
40.8%
|
|
31.9%
|
|
37.1%
|
|
Costs related to the
non-operational
Chongqing polysilicon operations
(proportion of revenue)
|
|
0.5%
|
|
0.7%
|
|
2.8%
|
|
Non-GAAP gross
margin
|
|
41.3%
|
|
32.6%
|
|
39.9%
|
|
|
|
For the three
months ended
|
|
|
Sep. 30,
2017
|
|
Jun. 30,
2017
|
|
Sep. 30,
2016
|
|
Net
income
|
|
24,351
|
|
12,260
|
|
11,331
|
|
Income tax
expense
|
|
4,218
|
|
2,768
|
|
2,163
|
|
Interest
expense
|
|
4,318
|
|
5,288
|
|
3,076
|
|
Interest
income
|
|
(117)
|
|
(111)
|
|
(123)
|
|
Depreciation
|
|
9,572
|
|
9,621
|
|
8,522
|
|
EBITDA
(non-GAAP)
|
|
42,342
|
|
29,826
|
|
24,969
|
|
EBIDTA margin
(non-GAAP)
|
|
47.4%
|
|
39.2%
|
|
46.0%
|
|
|
|
For the three
months ended
|
|
|
Sep. 30,
2017
|
|
Jun. 30,
2017
|
|
Sep. 30,
2016
|
|
Net income
attributable to Daqo
New Energy Corp. shareholders
|
|
24,109
|
|
12,125
|
|
11,196
|
|
Costs related to the
non-operational
Chongqing polysilicon operations
|
|
454
|
|
544
|
|
1,501
|
|
Share-based
compensation
|
|
1,045
|
|
1,104
|
|
522
|
|
Adjusted net
income (non-GAAP)
attributable to Daqo New Energy
Corp. shareholders
|
|
25,608
|
|
13,773
|
|
13,219
|
|
Adjusted earnings
per basic ADS
(non-GAAP)
|
|
2.42
|
|
1.31
|
|
$1.26
|
|
Adjusted earnings
per diluted ADS
(non-GAAP)
|
|
2.35
|
|
1.29
|
|
$1.24
|
|
For further information, please contact:
Daqo New Energy Corp.
Investor Relations
Phone: +86-187-1658-5553
dqir@daqo.com
View original
content:http://www.prnewswire.com/news-releases/daqo-new-energy-announces-unaudited-third-quarter-2017-results-300555303.html
SOURCE Daqo New Energy Corp.