JinkoSolar Holding Co. Ltd. Q1 2023 Earnings Call
Speaker 2: There will be a presentation followed by a question and answer session.
Speaker 2: If you wish to ask a question, you will need to press the star key followed by the number one on your telephone keypad.
Speaker 2: Now I'd like to turn the conference over to Stella Wong. Please go ahead.
Speaker 3: Thank you, operator. Thank you everyone for joining us today for Zincosolar's first quarter of the year's conference call. The company's results were released earlier today and available on the company's IR website at www.zincosolar.com as well as our news wireless services.
Speaker 3: We have also provided a supplemental presentation for today's earnings call, which can also be found on the IR website.
Speaker 3: On the call today from Zincosolar are Mr. Li Xiande, Chairman of the Board of Directors and Chief Executive Officer of Zincosolar Holdings Company Limited, Mr. Jana Miao, Chief marketing officer of Zincosolar Company Limited, Mr. Pan Li, Chief financial officer of Zincosolar Holdings Company Limited.
Speaker 3: Mr. Charlie Tso, Chief Financial Officer of Dinko Solar Company Limited. Mr. Li will discuss Dinko Solar's business operations and company highlights, followed by Mr. Nao, who will talk about the sales and marketing. And then Mr. Pan will go through the financials. They will all be available to answer your questions during the Q&A session that follows.
Speaker 3: As such, our future results may be materially different from the views expressed today. Further information regarding this and other risks is included in FincoSolar's public filings with the Securities and Exchange Commission. FincoSolar does not assume any obligation to update any forward-looking statements.
Speaker 3: except as required under applicable law. It is now my pleasure to introduce Mr. Li Zhen De, Chairman and CEO of Zincosolar Holding. Mr. Li will speak in Mandarin and I will translate his comments into English. Please go ahead in studying.
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Speaker 3: We have pleased to deliver year-over-year improvements in marginal shimmings, total revenues and growth margins. This policy-legon crisis being volatile in the first quarter, we adjusted our supply choice strategy to effectively control our costs, meanwhile the ratio of anti-product instruments approached nearly 50% of our total marginal shimmings.
Speaker 3: thanks to their high efficiency and our strong global marketing network, which partially contributed to the improvement of a profit ability. Gorsmarger was 17.3%, compared with 15.1% in the first quarter last year.
Speaker 3: Our profit ability in the first quarter remains under pressure from the mortgage cost in the US market. We have proactively taking matters addressed this and we have been both efficiently of customers clearance and the size of our model shipments to the US market gradually improve recently.
Speaker 3: As we continue to make effective progress, we expect our shipments to the U.S. market to gradually increase in the coming quarters. Recently, our majority-owned principal operating subsidiaries, Don Cinco, successfully issued convertible funds in the principal amount of RMB 10 billion.
Speaker 3: to strongly support the expansion of our high-efficient n-type capacities.
Speaker 3: Growth in PVA demand in the first quarter remains strong despite some seasonal factors. The Chinese market benefits from falling prices of PV projects and delays in PV projects from 2002. The new installations of PV reached 30.
Speaker 3: 3.7 GB, they say, an increase of a 154.8% year over year. As a result, the cumulative installations of the PV have to surpass the debt of a high-dew power for the first time making PV the second largest the power of self in China.
Speaker 3: The addition exports of solar cells and modules from China's overseas markets remains drawn in the first quarter. Total overseas instruments of modules and cells reach the US$13.1 billion in the first quarter and increase of 15.3 year-old year.
Speaker 3: Things that second and quarter at pricing games between different segments along the supply chain relatively stable life with the price of a polysilicon started to decrease Modulatory and a current model crisis has been attractive for the economics of PV projects
Speaker 3: With more production volumes to gradually release during a year, we believe policy-lican price decline will stimulate large-marketing months.
Speaker 3: The top manufacturers are expected to increase their market shares thanks to stronger supply chain management, market preference and the competitiveness of their earnings and products.
Speaker 3: We have optimistic about global marketing and its opportunities brought by new technologies in 2021. We will continue to invest in R&D and advance the entire capacity to enhance our entire labour leadership in terms of the mass production, type of latest, products performance and cost.
Speaker 3: while exploring the P.D.A. class area superactively respond to competition.
Speaker 3: The second of this of 11 giga with top-concell capacity in Xinjiang has reached the 4 production and the average mass produced efficiency of 182 and high top-concells reached 25.3%.
Speaker 3: We have also further improved our anti-acological chain, constantly enhancing our all-around competitive advantages of anti-wafer cell and modules. With improving supply chain management for K and auxiliary materials, iteration of core technologies and process improvement.
Speaker 3: As other technology, products, performance and costs are all improving continuously, we expect to maintain a leading position in the industry.
Speaker 3: Recently, we were ranked in the highest AAA category in a Q1 edition of PV Tax Module Tech Bank Ability Report, a reclination by the industry of our advantages from outstanding Dunning, Manufacturing, Finance, and Technology.
Speaker 3: By the end of the first quarter, Avocumillated anti-modulshmen exceeded 16 gigwatt.
Speaker 3: Providing support for hundreds of projects globally in the last in the past year.
Speaker 3: In January this year, we launched the second generation Tiger Neal Panel Family, a module efficiency of the upgraded Tiger Neal family of 455 Watt P for 54, still 615 Watt P for 72 sales.
Speaker 3: And the 635 Watt P478 sales were absolutely 22.27%, 23.23%, and 22.72% respectively.
Speaker 3: Meanwhile, we increased investments in energy storage business, furthering its development and continuously provided other clients with high-efficient, reliable and safe solutions at competitiveness, competitive costs to lead to the clean energy transformation. In conclusion, future competition will be based on comprehensive strength.
Speaker 3: of guidance for the second quarter and four years of 2023. By the end of this year, we expect the MEST produced end-to-end have sold efficiently to reach 25.8% and high efficient end-to-end have sold capacity to account for over 70% of our total solar sale capacity.
Speaker 3: We at Huffton will be able to achieve our module shipment target set at the beginning of the year with the anti-modules accounting for about a 60% of total module shipment. It expects the module shipment to be in a range of 16 to 18 gigahertz for the second quarter of 2023. Thank you. Total shipment in the first quarter reached about 14 points.
Speaker 5: in emerging markets like Latin America and Middle East North Africa also made a remarkable contribution. Recently, the industry's value chain price has gradually reached to a normal level, and the domestic utility scale TV project have shared
Speaker 5: started their speed invitations. The current module price is a fact about to client which can support them to achieve their pretty determined installation target at a stable quarter pace.
Speaker 5: We expect that the decrease of industrial supply chain price will drive the growth of utility scale PV demand, especially in China market.
Speaker 5: The European PV market has vast potential and the decrease in industry can crisis is expected to further drive demand for distributed and the utility scale power stations.
Speaker 5: The US market has robust demand and some utility scale power station demand may be delayed until 2023 due to price factors and a supply constraint, which expected 40 gigabond at the DC of PVD Star capacity in US by 2023.
Speaker 5: Over the past year, we have continuously improved our risk management capabilities, continuously improved our supply chain visibility system, and the maintained close communication and the coordination with customers, suppliers, and other parties to join the lake remote that efficiently after customer clearance in US.
Speaker 5: Based on the experience of supply chain construction and the marketing network layout, we are committed to meeting our customer delivery with outstanding products and services.
Speaker 5: With the experience of supply chain construction and marketing network layout, we are committed to meeting our customer delivery with outstanding products and services. Regarding the products we are committed to meeting our customer delivery with outstanding products and services.
Speaker 5: Tiger Nio achieved a shipment of volume near 60 gigawatt in the first quarter, maintaining a competitive premium.
Speaker 5: China, Europe and Emerald Remarket have become the main contributors to shipments.
Speaker 5: At the same time, we observed that Tiger-New is accelerating its penetration in markets like Asia.
Speaker 5: Recently, we were awarded the title of Australia number one module brand for 2020 2 by worldwide.
Speaker 5: Tiger Nio not only has multiple advantages such as high conversion seat.
Speaker 5: efficiency high power output and the
Speaker 5: by facial factors, but also leads the industry in terms of degradation rates, temperature co-efficient and weak light performance.
Speaker 5: meeting customers demand for household scenarios
Speaker 5: With the release of n-type capacity and continuous improvement of Tiger News product performance, Tiger News penetration rates and premium are expected to continue to leave the market.
Speaker 5: In terms of business distribution market accounted for more than 40% in the first quarter. Considering the standard amount for utility scale power stations this year, we expected the proportion of distribution to be around 40% for the whole year.
Speaker 5: In 23, our older book visibility exceeds 60% with the majority being overseas orders.
Speaker 5: As upper-screen raw material cost decrease, we expect the multi-market price to experience a slightly decline.
Speaker 5: Our signing price will fluctuate within a reasonable range in line with market trends.
Speaker 5: We will continue to focus on customer-centric approaches to provide high quality products and services to our customers. At the same time, we will adjust our marketing strategies of flexible.
Speaker 5: according to market conditions. With that, I will turn the call over to Penn. Thank you, gentlemen.
Speaker 6: We are pleased to report a year-to-year increase of about 17th-3% in our shipments in theirm for a quarter of a year-to-year and a year-to-year increase of about across the same a year-to-year increase of about across the same
Speaker 6: We strongly demand from global markets. In response to the policy comprised decline, we adjusted our procurement strategy and achieved significant year-to-year growth in key financial metrics including revenue, gross profit and operating margin.
Speaker 6: Let me go into more details now. Total revenue was 3.4 billion and increased.
Speaker 6: 58% is year-year.
Speaker 6: Of course, margin was 17.3% compared with 14% in the post-footer.
Speaker 6: and 15.1% in first quarter.
Speaker 6: of last year.
Speaker 6: The sequential and year-year increase were made due to the increase in the cost of polycylchism as the increase in shipment and type modules which have a premium compared with p-type modules.
Speaker 6: Total printing expenses.
Speaker 6: or 400 and 12 million. Down 21 percentage is sequentially an app.
Speaker 6: or 400 and 12 million down 21 percentage sequentially and up 29 percentage year-year.
The sequential decrease.
was made due to a decrease in shipping cost for solar modules and a decrease in impairment loss on property plant and equipment.
And the year-end year increase was mainly in attribute to an increasing loss of disposal on PPE.
and increase in the murered totes.
Total rating expenses accounted for about 12% of total revenues. Compared with even in the fourth quarter and 15% in the first quarter,
last year, improving year-to-year.
here in proofing year or year. Operating margin.
was over 5% is compared with 2% is in false quarter.
including the impact of the change in fair value of notes, a change in fair value of long-term investments.
and our <expletive> best conversation expenses.
Adjust the net income attribute to JIN COSOLOR holding company limited, or in Russia holders.
was over 100 and it took me 1 million.
have over two times sequentially and have 1.5 times be a leader.
Moving to the parent cheat.
At the end of the first quarter, our cash and cash equipment were about 1.5 billion down from 1.6 billion at the end of the fourth quarter.
and compared to its 2.7 billion at the end of the first quarter of last year.
Total depth was about 4.4 billion at end of first quarter compared to 4 billion at end of
Total depth was about 4.4 billion at end of first quarter compared to 4 billion at end of the fourth quarter last year.
Net debt was about 2.9 billion compared to
2.3 billion at the end of the fourth quarter of last year. And our total depth per fire has improved.
This concludes our prepared remarks. We are not happy to take your question.
I'll pray to please proceed. Yes, thank you. If you wish to ask a question, please press star then one on your telephone keypad and wait for your name to be announced.
and custom-riomly with Goldman Sachs and Company.
every time.
Hi, I guess first question I had was just around the ASP environment. I know you guys have seen some good margin expansion here. Call around call it town like most of that was listed in the, you know, the decline in poly so it can cost. So it can cost. So it's what's the status of that? How?
year we are hearing there's you know sort of double-bited declined in certain markets for solar panels and wondering where you are I think strategy kind of is trending for the next equally.
Hey, Brent. This is Jenner. Thanks for the question. First of all, the price side. So the market price is somehow stable in Q1 and Q2, meaning first half.
So I don't see there's too much, that's a different opinion across the industry about the first half, module price. But for the second half of module price, we have seen some different opinions about based on different expectations of the policy of the price.
However, in our opinion, the policy can price my standard going down step by step. We are not expecting a significant free fall over the second half, but we are more expecting a stable...
stepping down quarter over quarter. So based on that expectation, I think that's how we expect a modern price will go for the rest of the year. And the...
down quarter or quarter. So, based on that expectation, I think that's how we expect the model price will go for the rest of the year. And I hope that answer your questions.
Yeah, that's helpful. And then maybe just, I know you made some comments around the US of Mark, but can you give us your latest thoughts around shipping into the country, you know, how you're navigating the...
the U.F.L.PA and then also any thoughts around manufacturing or expanding your manufacturing based domestic green in the U.S. So for the U.S. Smart Decide I think we have close. These have most people working with-
lot of shipping in the last quarter. And we are expecting, you know, with more and more experience, we can ship or we can get more approved based on what we are doing right now, at least as that's the expectations. And based on that, we are planning to resume our project.
Okay, understood. Last question for me.
I don't know if I'm out of misdemeanority to improvise it, but can you get what the cat backs was in the quarter, what the free cash was in the quarter, and then any thoughts on kind of the financing needs and strategy for the rest of the year to cover the cat backs here? Thank you.
Hey, Brian , this is Charlie and we have the subsidiary, the Tinko Sodor. We have completed the Tampinean Converbal Bounce in Chinese capital markets recently. We have completed the Tampinean Converbal Bounce in China.
Hey, Brian , this is Charlie and we have the subsidiary, the Tinko Sodor. We have completed the Tampine Converbal Bounce in Chinese capital markets recently. Second is—
The cap packs, you know, it's a range of 1.5 billion to 2 billion RMB and the focus is to solidify our leading position in NTIP.
You know the supply chain including the you know wave first sound module capacities
and we're expecting you know the performance you know it's if you look at that Q1 performance it's pretty good anyway we can need to expand the expansion of the glass margin and our perfect areas and there's operating cash flows
Last year, it's kind of a round point for opening R&B and continuing to improve. So the financing is already there and it's sufficiently enough to meet our needs for the CAPDX.
I'll get there enough. I'll pass it on. Thank you, guys.
OK, thank you very much. I'll pass it on. Thanks, guys. Thank you.
Thank you. And once again, if you wish to ask a question, please press star then run on your telephone and wait for your name to be announced. And the next question comes to Phil Pschem with Rothmkamm. Hi everyone, thanks for taking my questions. First one I'll follow up to Brian on the U.S. LPA question. How many gigawatts?
have been released thus far in the US and how many KGWATs did you have detained total?
Philip, as soon as we have taken the opportunity to start from Q4 last year, our modules.
and under the UFLPA I started to go through their customs and you know, through our customers and we have, I think, achieved a significant amount of the module, you know, instruments.
And for the detained, I don't think we have already worry, worry, worry, smoke, and timing. And the most important thing is looking forward. We think the mechanism has already been there. And we have to be separated, we're strong, we're separated.
capabilities and we expect you know quarter by quarter our shipment to the US will improve you know gradually and hopefully we think it's possible in a sort of quarter our shipment to the US will be and back to normal situations. Great thanks Charlie. So of the more than 60% of the order book disability.
We're going to, you know, like Charlie saying, we are gradually, you know, resume our shipments and the RAMU reclinations, like the course of the, you know, time consuming of the logistics and the UFPR, etc. So the RAMU sign won't be too much. That's why we say around 5, maybe 5 to 10.
So our work suggests that...
The non-China polymodules that you have that can access the US market is roughly 5 gigawatts annually. Does that sound right? And then is it the case that you can smoothly import modules that contain non-China poly now? So there's no issue there at all. Thank you.
Thanks for the question Bill. We currently we are planning with the model of resources of policy-related and at least that we are trying to do because if we rely on single resources of policy-related, it matured in pipeline links.
Constraint capability of the supply for US market. Personally, I still believe that might be a challenge for the US customers as well. So that's what we are trying to do.
capability of the supply for US market. Personally, I still believe that might be a challenge for the US customers as well. So that's what we are trying to do.
And then shifting back to margins for a bit or two margins for a bit, can you give us a sense for how do you expect margins to trend in Q2 and Q3, especially given the ASP comments that you had earlier.
Do you expect margin expansion in Q2 and Q3 perhaps in margins to compress a little bit with...
Some risk to back-half pricing, thanks. I think the margin-wise, we have the confidence to gradually improve. At least that's what we believe. Because thanks to the new technology, the...
Business Emer ???,
Okay great. One last question. As it relates to US expansion, I think Brian asked the question. I just want to check in to see if you can give a little more color on the timing of that. My guess is you have to wait for the domestic content rules to be out. And then what do you see for US module pricing trends?
Do you think maybe by a year between this year, 2024 and 2025? Thanks. Do you think maybe by a year between this year, 2024 and 2025,
Do you think maybe by year between this year 2024 and 2025? Thanks.
Thank you. And again, if you wish to ask a question.
Sorry, I think we missed the last question. I'll try to briefly talk about it. Then we can pick up the next one, right?
Yes, yes. So regarding the US expansion, we have the confidence, we have the plan to do it, but for sure we are still waiting for some more clarification on the policy side or approval on the policy side. We are closely following that. Hopefully we can get some clearance good to go in the next coming weeks or months. Thank you.
Thank you. Let's take the next one. Thank you. And again, if you wish to ask a question, please press the star of the monitor telephone and wait for your name to be announced.
And the next question comes from our large efforts. Thanks a lot for taking my question and congratulations for the really great results and the margin expansion. So my first question is, would like to know how much did the port charges related to the payment?
in the US border has ran down. And if this is going to be zero, going forward then, with that, how much would that contribute to the margin expansion?
In the first quarter we have roughly 300mm RB to 400mm RB. 400mm RB, you know the the D-Murage and the additional storage cost for the US.
In the first quarter we have roughly 300 million RMB to 400 million RMB, the demerits and additional storage costs for the US shipment situations.
And it's roughly, I think, 2%, 1.5% to 2% goes mounting impact. And we expect in a Q2, where dramatically decrease to maybe 25% of the...
25 25% of the Q1 level so it's going to counter-build I think at least 1% across from our agency. Expansing. Thanks a lot. So another question is.
we'd like to know how much is the poly prices for the polysilicon purchase from Weka so is it the same is it going down at the same pace as the polysilicon price in china or it's going down a bit slower
It's really typical of the confidential, but it's a separate market. The policy out of China, the main purpose is for the US markets.
and it's no expansion or capacity for the outside of China. So it's kind of worried, let's say, worried, the shadow of supply situations and the prices are very sticky. And by the different situation in China, the parties.
supply is sufficient and we expect maybe some relatively oversupplied situation in your fourth quarter this year. So it's kind of different pricing depending on situations.
So is it possible that if the US customs accepted some of the Tongueway polysilicon, then your shipment to the US will get even higher margin because you get?
effectively cheap or policy-driven price. I think it really depends on the market principles, right? So we're supplied, like I said, the policy of non-Titan policy is a serious short of supply. And the end market is very strong, so we're definitely going to create a...
Expansion. Thank you. Oh, currently we have, you know, seven gigats integrated capacity, but we have planned to expand the capacity in well, NAND.
and it's a possible rich to maybe 11% or 11% to 12% or integrate it to the capacity by the end of the sea.
Thanks a lot, that's very clear. So looking forward for the great results in second. What I have, thank you.
Thank you. Thank you. And once again, if you wish to ask a question, please press the star that you want in your telephone and wait for your name to be announced.
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