Q3 2022 JinkoSolar Holding Co Ltd Earnings Call
Yes.
Hello, ladies and gentlemen, and thank you for something by phone Genco stood out.
So in <unk> 2022 earnings comes from school.
Time.
And are in a listen only mode.
After management's prepared remarks, there will be a question and that's it.
A question and answer session.
Remember today's conference call is being recorded.
I would now like to turn the meeting goes out to your spots what they call to me he's still a longer <unk> two now who've been sirona shouldn't.
Please proceed.
Yeah.
Thank you operator, thank you everyone for joining us today for <unk> third quarter 2022 earnings Conference call. The company's results were released earlier today and available on the Companys IR website at Www Dot single solar Dot com as well as you can see why with the services. We have also provided dates up supplemental.
Presentation for today's earnings call, which can also be found on the IR website.
On the call today from single Solar Amit said extend the chairman of the board of Directors and Chief Executive Officer of <unk> Solar holding company limited Mr. Jenner Miele, Chief Finance, the Chief Marketing Officer of Genco Solar Company limited Mr. Pat The Chief financial officer of being closer to our holding company limited.
And let me say, Charlie <unk>, Chief Financial Officer of Genco Solar Company limited he said it well discussed and close all the business operations and the company highlights followed by Mr. Miao, who will talk about the sales and marketing and then Mr. Peng who will go through the financials. They will all be of level available to answer your questions during <unk>.
The Q&A session that follows.
No. That's today's discussion will contain forward looking statements made under the safe Harbor provision of the U S. Private Securities Litigation Reform Act of 1995 forward looking statements involve inherent risks and uncertainties as such future results may be materially different from the views.
Expressed today further information regarding this and other risks is included in <unk> public filings with the Securities and Exchange Commission equal solar does not assume any obligation to update any forward looking statement, except as required under the applicable law.
It's now my pleasure to introduce <unk>, chairman and CEO of <unk> Holdings, Mr. Li will speak in Mandarin and I will translate his comments into English. Please go ahead Mr. <unk>.
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We are pleased to announce a better than expected results for the quarter. Despite a number of headwinds such as the continued rise in raw material prices. However, irrationally measures at our manufacturing facilities and.
Earthquake in Sichuan Province, where one of our manufacturing facility based plus a solar shipments in the third quarter were roughly $10 nine gigawatt doubling year over year total revenues were U S. Dollar to fund 74 billion, an increase of one to seven 8% year over year, we kept in.
<unk>, our supply chain management to in house cost controls.
A list of newly invested N type cell capacity, we further optimized our integrated cost structure as shipments of more competitive and type products increased significantly compared with the second quarter.
Ability in the third quarter largely improved sequentially gross margin was 15, 7% compared to 14, 7% in the second quarter net income was <unk> dollars $77 3 million, an increase of eight three points to 1% year over year.
Excluding the impact of the convertible senior notes and a share based compensation expenses. Adjusted net income was U S dollar $61 million, improving 16, 1% sequentially.
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Since the start of the fourth quarter polysilicon capacity has been gradually released demand is strong in the China market encouraged by now hydro renewable construction package, both provincially guarantee that utility scale projects and utility scale projects in the liberalized power market.
<unk> rapid progress.
I think the demand from DG market, we expect that the total installation in China will be over 40 gigawatts in the fourth quarter.
While supply has increased the recently strong demand is keeping polysilicon prices are steady at a high level and translate the module price. It remains stable with substantial polysilicon capacity to be released in 'twenty to 'twenty three we expect the prices of raw material to fall and to stimulate.
Pent up demand.
The growth opportunities in the market executing our globalization strategy and a healthy result, as inputs in K market also we will control inventory turnover at a reasonable reasonable level with our efficient supply chain management, leveraging our extensive global industrial channel.
Building at our reliable products, where our confidence to achieve increases in both shipments and market share next year.
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We made further progress in efficiency improvement and cost reduction for N type products, that's to the continuous continuous efforts of our R&D team expanding our accumulated knowledge and our mass production experience matters.
And that's pretty I'll say efficiency for tough comp sale at the way. It reached the full capacity of the 16 gigawatt reached 25% and we are narrowing the gap.
Integrated cost for N type compared to a P type products recently, the maximum solar conversion efficiency for our 82 mono crystalline silicon popcorn sale reached 26, 1% breaking the record of 25, 7% we set in April this year.
Bind with process optimization with sbe technology mass production efficiency.
In fact, it to further improve next year.
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Benefiting from a capacity release and higher client acceptance shipments for N type modules or apps.
Roughly three gigawatts in the third quarter, an increase of nearly 160% sequentially well have always been committed to sharing the benefits from the gas and power generation with our clients.
Anti products continue to be well received in the market. We are confident to lead the industry. This increasing penetration in a cost effective performance.
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The second of those eight gigawatt telecom cell capacity in coffee, which commenced production in the third quarter is it ramping up smartly. The second phase of the 11, Gigawatts telecom cell capacity in Tanzania, which product, which started construction in the third quarter is expected to start to Scott.
Production before the end of this year.
In Asia, Asia, and a ramping up of new capacities will help further optimize our integrated capacity structure and drive our blended cost of lawyer based on our operating strategy and the market demand, we adjusted the pace of our capacity expansion for wafers cells and modules.
End of this year, we expected our annual Roth annual production capacity for mono wafer solar cell and solar module to reach 65, 55, and seven gigawatts respectively.
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Before turning it over to China, I would like to go over our Capex guidance for the fourth quarter. This year, we expect that the module shipment to be in the range of 13 to 15 Gigawatts for the fourth quarter of 2020 two we're bullish about demand growth in the global market and dedicated to providing optimal.
<unk> to our clients, but it's technical innovations and a reliable product we expect that the four year module shipments to be in the range of 41, 5% to 43 five gigawatt.
Thank you.
Despite short term headwinds such as power rationing measures and earthquake and keep the total shipments in the fourth quarter were $10 92 up.
Approximately 95% of our module shifting.
Doubling year over year on the backlogs with strong global demand.
In specific market, China, Europe , and the emerging markets contributed with multiple include net growth.
Solar module shipments to the Chinese market dealing with corporate increased five times year over year.
Emerging markets grew approximately 180% year over year and the Europe over 60%.
With a rush of installations in China in force corner, the Chinese market.
So that will contribute to absolute maturity and we expect our penetration in the Chinese market to further increase.
Demand was strong in the amount of work.
All this the logistics for NOLA installations on the labor shortage quantities remained short term challenges we have.
Inventory turnover through proactive court.
Coordination with logistics support as well as our flexible Messrs mandatory terms in order to support the energy since formation of European there too.
In terms of the products, we sell the promotion and the sales of our high efficiency N type.
Is that new modules, leveraging our global marketing that work layout and localized so much into it.
In the first quarter shipments were Tiger new modules approached approximately three gigawatts.
160% sequentially.
Acceptance from various large parts in the market before they take on you said the increase.
<unk> was in line with our expectations.
We have seen establishing a business model to share the benefits from again in power generation by take or do you imagine this with our clients.
And are committed to providing them with solutions that continuously bring done.
This gradual release of N type capacity and the increasing acceptance of your take on your shipments under penetration for Targa and you will continue to grow in the fourth quarter.
So shifting to propulsion for Tycho.
Got to be above 60% of our total shipments in 2023.
So business layoffs.
The amount that remains strong in some markets, including Europe emerging markets and China.
Digital business accounted for.
2% in the third quarter about 10% higher than last quarter.
We expect market demand to continue to increase in tissue can be freed up over 30% year over year.
Two markets, including China, Europe U S.
So that will contribute.
Contributing to growth.
And that's the backdrop.
<unk> end markets.
We will speak to our strategy for global market layoffs, focusing on Chinese market will enhance sanitation too.
It's <unk>.
Operations in emerging markets.
We will strive to achieve around the 50% growth in shipping next year compared to 2022.
Keep a solid position for global competitiveness.
With that I'll turn the call over to Chad.
Centered dinner, where.
We are pleased to report another quarter of improved financial results.
Total shipments doubled and total revenues increased to 128 percentage year over year.
<unk> strong demand globally.
Thanks to optimized integrated capacity structure and <unk>.
Shipments mix <unk>.
Key metrics, including gross margin.
Margin and net margin or improved sequentially.
Sure.
Such as power rationing measures and an earthquake as well as new capacity ramp up.
Some impact on profitability in the third quarter.
We believe that at least negative factors gradually recede.
We will see a gradual increase in profit contribution from additional release.
And tight capacity and an increase in shipments propulsion and type product.
Let me go into more details.
Total revenue was up.
$2 7 billion up sequentially and a significant increase year over year.
Gross margin was 15 seven percentage compared with 14, 7% in the second quarter this year.
15, one percentage.
Last year.
Total operating expenses.
$423 million slightly down sequentially and up year over year.
The year over year increase was mainly attributed to an increase in shipping cost for solar modules.
Total operating expenses accounted for two four percentage of total revenues in the third quarter down from 16, two percentage in the second quarter. This year and up from 13, 8% between the third quarter of last year.
Excluding the impact from a change in the fair value of the notes and the ship is compensation expense.
Adjusted net income attributed to Genco solar holdings ordinary shareholders was $16 million improving sequentially.
During the quarter, we continued to optimize our foreign exchange hedging.
We realized a net foreign exchange gain.
Including champion fair value of foreign exchange.
Our relatives of AR.
Approximately $73 million in the third quarter compared with a net gain of $34 million.
In the second quarter of 2022.
Moving onto the balance sheet.
At the end of third quarter, the company had cash and cash equivalents.
$2 1 billion slightly down at the end of the second quarter of this year.
And up from $1 1 billion at the end of third quarter last year.
Now some number of days.
Well 16 nine days in both third quarter and second quarter of 2022.
Inventory turnover days were 117 days in the third quarter compared with <unk>.
104 days in the second quarter of this year.
Total debt.
It was about $4 2 billion at the end of the third quarter for all.
$3 8 billion.
Net debt for.
It was about 2 billion compared with $1 7 billion at the end of the second quarter. This year.
This concludes our prepared remarks, we're now happy to take your questions.
Operator. Please proceed.
Thank you, ladies and gentlemen, if you wish to ask a question Keith President who one and.
Zero two to come soon.
Okay.
The first question comes from Brian Lee from Goldman Sachs.
Please go ahead.
Alright. Thanks for taking my question. This is Greg on for Brian I guess first one on your capacity just.
Just given the passage of the inflation reduction.
A number of your peers.
You have capacity expansion, so I just wonder what's your strategy there.
If any.
How are you going to fund that and what's the implication to your free cash flow.
Yeah.
So assuming you are talking about the IRS and the impacts on our side as well.
<unk>.
Yes.
Yes, yes, yes, yes.
Okay.
The company perspective based on the initial assessments of the act.
We believe this is very positive.
The incentive as I say.
<unk> significant.
And to make the.
I think as the production local production in the United States.
No.
Are they competitive.
We are well.
Details of Iras.
It's going to be released in Q1 next year. So we are very closely following up the details.
And as you know we have a very small module capacity in the U S 400 megawatts and we are optimistic.
After we.
The release of the details of all right.
It's possible, we expand our module capacity in the United States.
At this stage.
It's still in the evaluation stage.
Okay Fair enough and then maybe switching gears to your gross margin.
It's interesting to see 15% to 7%. This quarter you mentioned was helped by the.
The.
Module.
Top on our module shipments so I just wonder how much of your smart margin is helped by the type of shipment module versus the current because I assume a lot of your operation is in China.
Also can you just talk about your margin expectation for next several quarters.
Thanks.
Yes.
Yes.
We improved our margins slightly down this quarter quarter over quarter, and we deliver to the street gigawatts.
Taco modules, which accounts for around 30% now our total shipments in this quarter.
And the.
The gross margin in Taiwan is relatively higher than the <unk>.
It's around 2%.
The gross margin perspective.
<unk>.
On top of that.
The.
Prepared remarks, but there was a knee and.
The third quarter, we faced the power outrage since I'm province, which has some negative impact.
So.
<unk>.
Overall.
Thanks.
Well I think we're leading in the industries.
<unk> com.
Increasing fees.
As to the cost perspective.
Our penetration penetration.
Well.
We knew to improve quarter by quarter, which will help us to drive.
I think the profitability increase.
Including the gross margin.
Okay. Thank you.
Can I squeeze in one more housekeeping questions.
Kris you our module and wafer capacity so what's your Capex plan for 2022, and and what was your DNA through two things.
Okay.
Thank you for the question the Capex of the <unk>.
This year, we still keep the.
On the $3 billion.
Yes.
Yeah.
Okay. Thank you and the DNA for thank you.
Okay.
So your question is Joe Hey, the apps.
Lumber or percentage.
What is your sense of it.
Got it.
Uh huh.
Thank you for your question about the G&A expenses tick the box.
Around four to five percentage.
Of the total revenue.
Thank you.
Thank you.
The next question comes from Chile to Shin from <unk>.
Please go ahead.
Hi, everyone. Thanks for taking the questions.
As a follow up to some of those questions.
I was wondering if you could talk about capex expectations for 2023.
By the end of 2023, how much wafer cell and module capacity.
Do you think you'll have.
So.
No.
Yes.
So to Firestone.
So I think we have.
We have sufficient capacities.
Two two.
Work is in a position to deliver our results next year.
We will continue evaluate market conditions next year.
I think the market as well.
Optimistic for next year, So our investment will continue to focus on.
I think cell and module capacities and next year.
To build sufficient capacity.
For both next two years.
Our shipment guidance.
So we're going to leave I assume.
The guidance capacity expansion next year and.
And next quarter.
But.
The key focus will continue.
<unk>.
The tough comps.
The sale and module capacities.
Okay. Thanks, Charlie.
Whats after top con.
I'm imagining you guys are already thinking about it.
With 60% next year.
You think.
Youre going to move on to head our junction or have you decided on the technology roadmap beyond.
Top line. Thanks.
We know we are leading the top content knowledge.
Capacity.
Product, let's say the efficiencies and we believe it is a significant room to continue to delever.
Further our high quality products based on <unk>.
In time Telecom Telecom technology and <unk>.
Our R&D teams has it eased.
The.
Laboratory testing.
Efficiency will reach to 26, 1% and our product.
Our targets for the.
Mass production efficiencies by the end of next year will be.
Rich to over I think 25, 7%.
We have technology roadmap on the cut.
And.
We strongly believe and Todd.
Tough comp we are dominant.
Next the.
Markets in the next two three years so.
Tough times our focus.
The R&D infrastructure.
We're closely monitoring.
<unk>.
Sure.
The basic knowledge.
We strongly believe.
The.
Tough comp.
Is it a trend.
Great. Okay. Thanks, Ken in terms of the U S market.
The <unk> enforcement in the CVP process that youre going through.
Was wondering if you could talk about and give an update as to where things stand my understanding is.
The process has come to a close and you're waiting on a decision.
And so how much longer do you think we need to wait.
And also let's say you get released.
Soon.
Does that mean you can.
Freely ship into the U S or do you think you have to.
Secure something like an advanced letter ruling to be able to truly shifting to the U S. Thanks.
Yes.
We did a lot of work on that.
U S U S <unk>.
This is a standard.
We'll report on the challenge for.
Traceability systems.
We prepare documents.
Several lines.
Discussing communication with CDP.
Assuming our documentations are really.
And waiting for the final for the backbone the CEB.
We are optimistic further readouts by the detailed timing.
Yes.
I think it's not so far.
For the second question is after the.
Please.
But the <unk> modules.
We try to improve.
Our internal efficiencies on tied to.
To continue to come in okay, with CVP to make sure.
Let's say the bottleneck and will be.
Deposits in the noise.
A lot of internal external.
Factors, including.
Capacities from CBP has an impact on the.
The.
The efficiencies.
No.
We don't know.
And what will be the.
Let's say the increasingly sources in the future, but I think after the learning curve in last two or three months, we think.
It's going to be getting.
More on a more smooth smooth.
Yes.
Okay.
Charlie can you talk about how many gigawatts of <unk>.
Supply.
Has been impacted for you since the first retention at the end of June .
Between then and now end of October .
And then it continues through the end of the year, what kind of number can you share how many gigawatts I know that the detain module is a smaller I'm talking about the total.
No impact to customers or we're talking about two gigawatts or maybe maybe even more thanks.
Uh huh.
Yeah.
You are right to detain module, where small and but because of delays deposit side, it's going to have learning in pad two.
Shipments of our U S customers and there were estimates this year on year.
Our shipments in the U S.
Be around 5% and versus the original I think.
Planning.
From the beginning of this year.
10% or so.
Operator.
Okay.
A significant impact.
Okay, 5% of the 44 or 40, plus gigawatts roughly two two gigawatts.
Correct me, if I'm wrong of course.
And then.
One last question from me in terms of them.
The growth for.
For next year, I think generally you talked about a 50% growth.
Matches with your year end module.
Capacity roughly.
Can you talk about the geographic mix you expect how much for example are you expecting for the U S. In 'twenty three and then what do you think.
As the rest of it how much will China be Europe emerging markets. Thanks.
So Joe.
Would you like to take the question.
Okay. So generally.
And then my other question.
In Crystal mentally we're seeing next year.
China, we are a dominant taken maybe 40 or 50% from the incremental value.
William.
And the second was the U S and.
European markets are U S and we don't believe.
Demand.
It's purely the supply.
Issues, including.
Potential impact from the U S and we believe in the U S.
Aerospace most and maybe 40 40 module demand.
<unk>.
Gigawatts.
And.
Yes.
So.
As you know.
This year because of the policy against very high the module prices high which delayed.
If we do a lot of you today.
It has scale projects and installations in next year what is the bottleneck.
The.
Polysilicon.
And the production volume.
Significant increase.
We'll have very good timing for for the sort of disco developers to two.
The module center connects grids.
Alright, thanks for so just to put numbers on it so let's say China is 40% to 50% do you think U S is <unk>.
15% to 20 and similar with Europe .
Yes.
Yes.
From $4 million of mental perspective.
No.
Thank you.
I was thinking I was talking about the mental Ryan we believe the total market I'm talking about.
Okay.
Starting to drive just let's say, it's 65 Gigawatts next year of shipments.
You said, 40% to 50% of the 65 would be China, I'm, just trying to figure out what percentage of about 65 might be Europe and U S.
Oh, okay.
I mean, the incremental right.
It's not necessary incremental increments.
Yes, Jeff.
65, gigawatts, how much would be U S, maybe 15% or 5%, assuming your youre able to funnel the module is truly thanks.
Okay.
Let's say the total size to me over this year, maybe 250 <unk> installation.
The soda and next year, maybe 300.
Maybe.
Thank you all right 350.
We believe China will take around.
Certify 40% market share.
The U S will take around 10%.
Pam royalty.
I think 20%.
Mhm.
Great I appreciate the color thanks for taking all the questions Charlie.
I'll pass it on.
Yeah.
Okay.
Ladies and gentlemen, I would like to remind you that keeps you wish to ask a question Keith.
One.
The next question comes from and then now from Jefferies.
Jeff. Please go ahead.
Alright. Thank you for taking my question and congratulations for the extremely.
Good results.
So so we'd like to know what is the outlook of the gross margin in the next quarter.
And also.
As the company has maintained 10 gigawatt of N type shipments. So in Q4 can I expect.
There will be around six to seven gigawatt of popcorn shipment.
Yes. Thanks.
No.
We have capacity.
I think in those.
This year 75, Gigawatts, so youre right. If you do the calculations quarter over quarter, our shipments I think.
Q4 will be around.
506, Gigawatts in Q1 next year will be.
None of it higher.
In Q1.
The gross margin.
Yeah.
Because in Taiwan.
More percentage in Q4 on top of that.
China will take.
More market shares more more shipments in Q4.
As well.
The RMB depreciation.
Okay.
We believe there is a potential.
Potential to the gross margin will continue to expand.
Okay.
Thank you.
Uh huh.
And another question is the.
The company has realized.
Ron three gigawatt of top line sales in Q. So.
Got it.
And also the company has mentioned it has reached the expected premium so is it around RMB 10 cents of premium.
For the fleet gigawatt has been sold in Q3.
The price premium of around seven and RMB.
And even after consideration of the cost difference.
The.
Sure.
Perfect.
While basis.
However, as with every hire.
Pacifier full arm.
Understood.
Quite a lot actually okay.
Okay.
Yes.
In terms of net profit right.
<unk> higher.
Sorry.
No further questions.
So so far <unk> in terms of net profit rate for the popcorn process alright.
Yes.
RMB four RMB per watt okay.
Thank you.
And.
<unk>.
So.
Note that the company has raised the popcorn shipment.
Turning to our new suite from 50% to 60%.
So.
What makes you raised guidance and should we expect a higher.
Net profit for next year because of this increase.
Yeah.
Yeah.
We will continue to invest and Todd talked about module capacity next year. So based on our initial.
Evaluations.
We think we are able to deliver our off 16% on tough.
Todd.
Module next year.
<unk>.
With that said we are more.
All the telecom module.
No more mix to top com module spacing.
Perfect.
Now with small percentage on the more higher profitability as well.
Hum.
For the total results.
Thank you and I think my last question is.
Regarding to the partnership with the equipment provider acto well.
So are they.
This is.
Jim.
Put it this way so it has single sort of benefit from the partnership with them by having more competitively priced equipment.
Uh huh.
Yes.
The module.
Sure.
But they are producing.
Ortega and selling.
Crystal growing equipment to Genco and what I heard if the price is cheaper right.
And so I don't know we will also invest in some manner.
Yes.
For the for the for the.
Business and.
So I think as always.
We're a bit.
Major for the R&D purpose and we want to.
We have more development.
Technology and.
Aligned with our suppliers too.
Thanks to the equipment and more.
Advanced in particular for <unk>.
Sure.
The.
The wafer production.
So thanks, a lot and once again congratulations to the company.
Thanks.
Thank you.
Sure.
Your next question comes from.
<unk> <unk> from <unk> capital.
Please go ahead.
Hello.
I have two questions one is on shipping costs.
And we know that shipping costs have come down very substantially in the last three four months in.
And actually they are close to the levels. They were at before Covid started.
And I'm wondering whether you have when we will start to see that in your <unk>.
Number how soon will those be reflected and.
And when that gets to the affected can we expect that shipping cost can go from.
6% of the revenues to maybe 3% of revenues. So that's my first question.
Okay.
Yes.
Global economy is wait and.
Shipments similar costs in addition to amounts as well.
The indexes has talked a lot.
Quarter by quarter.
Year.
And.
But.
It's going to be more departure for starting from the next year.
For the this year starting in Q4, I think the impact to us so.
The party Congress also so significant because we have long term arrangements.
Just the companies.
Long term contracts at prices already.
<unk>.
Below the market price.
With the market price talk a lot and expectations on next year is to continue to be.
Backdrop.
No more standards.
Perhaps a couple of years ago.
We've already negotiated the long term our instruments.
For next year.
That is going to be.
No.
It has an impact.
For next year.
Okay.
And Charlie the second question is about the.
Polysilicon cost.
Can you give us.
Your best.
Guests are your best sense right no judgment right now on when you expect polysilicon costs to start to come down and what rate. They will come down in 2023. For example, what do you think polysilicon cost might be by the end of 2023.
And then related to that.
What is your plan for sharing the benefit of this cost reduction with your customers.
You had mentioned last.
In the last call that.
That's on the N type.
You are getting the benefit of the N type 50, 50 with your customers.
Are you planning to share the benefit of polysilicon cost reduction also 50 50 with your customers.
Okay.
Hum.
This is the world come to take questions.
Hello.
But we strongly believe as a trend is there.
Yeah.
A lot of the polysilicon capacities.
Has been.
Ramping up.
In the last two or three months.
No.
The products that are kind of volume growth.
Greece months over months from Africa, and next year.
Our sufficient quality.
Capacity.
The volume too.
To support total demands on next year.
And.
Now the silicon prices flat and.
We see some.
Potential.
Potential partners.
Silicon products as well.
No.
Downward trend.
Coming from the December .
In offshore.
China is there.
It's very difficult to estimate what is the exact same exaction path.
Hi.
For the wrong answer.
Holly.
The.
Home office structure.
If we try to.
No.
We tried to.
Two two.
To have more sign the orders for the next year.
Particularly with our strategic customers and some customers they may have.
No.
Okay.
Intentions in two half.
Hi.
Adjustment mechanism.
We're seeing a doubling in many situations.
We will.
Based on case by case, we will negotiate with different customers.
So can you give us an overall sense then.
Yes.
Price of polysilicon comes down by.
Whatever X number of cents.
On an overall basis.
Much of that you would.
Pass onto the customers and how much you would keep to improve your own gross margin.
Alright.
It's not.
Awareness.
<unk> case.
Some more customer we have fixed price somewhat customers, we have horrible price.
With some exit them.
Indexed to the <unk>.
Market pious or some.
It's different case by case.
Yeah.
Okay. Thank you.
Thanks.
Ladies and gentlemen.
If you wish to ask a question. Please press the whole one on your tickets on spec.
We have a new question from Harbin Yahoo.
Why to catch done so please go ahead.
Hello management.
I would like to know.
On what percentage you expect your fourth quarter shipments.
It will be shipped to China, because I can see that in the third quarter.
<unk> 40, something percent, maybe close to 50, so what to expect in the fourth quarter.
China.
So.
One of the large market fourth quarter.
By the end of the year a lot of utility scale developers.
They have strong.
On pressures.
Intentions to Suraj.
And the connection of goods.
No.
We have estimates.
Q4, we will have in.
China markets are wrong I think no.
Yes.
50% to 55%.
Okay. So do you think that the.
Domestic increasing public control could be a challenge or.
You've already well prepare for those kind of pick up and so we need developers.
For their project demand.
There are some tenants.
Because of Covid situations.
It's.
I think the challenge is the largest logistic perspective.
We are seeing some improvement.
And.
In some regions.
So we think that there are sufficient.
By the end of this year to turn it over.
The module schedules.
Okay. Thank you.
The next question is about the tough comp and top corn product. So.
The third quarter, when we ship those products.
Where is the major market for this product is like in Europe or U S or.
Only in Chinese market.
The majority of ours.
Europe .
And.
Also have shipments in China.
The North America or under.
Sure.
Asia Pacific.
Right.
Sure.
So basically maybe loan.
Sales in China, and then basically everywhere you have some like a product demo.
Four four for.
Our global users.
So it's not product demos and we have.
Promoting the products starting from last year.
And.
No.
That's a significant shipments.
Yeah.
Two different markets.
European market.
So we are a bit.
Following that.
So different countries and regions.
In China.
Latin America.
Australia et cetera.
Okay.
My final question is regarding about the upstream supply other than polysilicon.
The other thing that.
The quad band.
Material could be a bottleneck.
<unk> 2023.
For for your internal wafer production.
So what kind of bottleneck of materials I was talking about.
Quad.
Since.
Okay.
Thank you. Thank you.
Yeah.
This has been talking about a long time.
What we.
We're seeing it.
Little bit ties.
This particular mountain materials, but.
It's still kind of support or <unk>.
The 500 megawatts.
And.
No.
On top of that.
Yeah.
First the expansion.
I think there are over next year, maybe in Nigeria.
Solvent.
Uh huh.
Tons.
Hum.
Technological perspective.
We think that the.
It's feasible to use more percentage of domestic.
Produce materials and.
Other than that.
<unk> materials.
Hello.
It's more like the <unk>.
Got it.
The efficiencies cost per structure.
The water infrastructure.
Okay. Thank you. Thank you I'll pass it on.
Yes.
Yes.
Sure.
We have no further question.
There is no more question.
Okay.
Okay. Thank you everyone. So we will now end the call. Thank you.
Good luck.
Yes.
This concludes today's call. Thank you for your participation you may now disconnect.
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