- Net sales of $801 million
- Net income per diluted share of $2.50
- Net cash balance of $1.3 billion
- Maintain full-year 2023 revenue guidance and raise the
mid-point of EPS guidance from $7.50 to $7.60
- YTD net bookings of 27.8 GW; 6.8 GW since second quarter
earnings call with an average selling price of $0.30 per watt,
excluding India
- Expected sales backlog of 81.8 GW
First Solar, Inc. (Nasdaq: FSLR) (the “Company”) today announced
financial results for the third quarter ended September 30,
2023.
Net sales for the third quarter were $801 million, a decrease of
$10 million from the prior quarter. The decrease was primarily
driven by a reduction in volume of modules sold.
The Company reported third quarter net income per diluted share
of $2.50, compared to net income per diluted share of $1.59 in the
second quarter of 2023.
Cash, cash equivalents, restricted cash, restricted cash
equivalents, and marketable securities, less debt at the end of the
third quarter, decreased to $1.3 billion from $1.5 billion at the
end of the prior quarter. The decrease was primarily a result of
capital expenditures related to manufacturing capacity expansions
in Alabama, India, and Ohio, offset by operating cash flows and a
final drawdown under our India financing facility.
“Since our last earnings call, we have made steady progress,
establishing the foundations for our long-term growth journey,
including investments in manufacturing and the infrastructure
needed to rapidly evolve and scale our technology,” said Mark
Widmar, CEO of First Solar. “Our growth is underpinned by our
points of differentiation and solid market fundamentals, including
continued strong demand for our products, proven manufacturing
excellence, a uniquely advantaged technology platform, and,
crucially, a balanced business model focused on delivering value to
our customers and our shareholders.”
Our 2023 guidance has been updated as follows:
Prior
Current
Net Sales
$3.4B to $3.6B
Unchanged
Gross Margin (1)
$1.2B to $1.3B
Unchanged
Operating Expenses (2)
$450M to $475M
$440M to $470M
Operating Income (3)
$745M to $870M
$770M to $870M
Earnings per Diluted Share
$7.00 to $8.00
$7.20 to $8.00
Net Cash Balance (4)
$1.5B to $1.8B
Unchanged
Capital Expenditures
$1.7B to $1.9B
Unchanged
Volume Sold
11.8GW to 12.3GW
Unchanged
——————————
(1)
Includes $110 million to $120 million of
ramp and underutilization costs and $670 million to $700 million of
Section 45X tax benefits
(2)
Includes $75 million to $85 million of
production start-up expense and $36 million of litigation
losses
(3)
Includes $185 million to $205 million of
production start-up expense and ramp and underutilization costs,
$36 million of litigation losses, and $670 million to $700 million
of Section 45X tax benefits
(4)
Defined as cash, cash equivalents,
restricted cash, restricted cash equivalents, and marketable
securities, less expected debt at the end of 2023
The guidance figures presented above are forward-looking
statements that are subject to a variety of assumptions and
estimates, including with respect to certain factors related to the
Inflation Reduction Act of 2022 (the “IRA”). Among other things,
such factors include (i) the total advanced manufacturing
production credit available to us under Section 45X of the Internal
Revenue Code and (ii) the timing and ability to monetize such
credit. Investors are encouraged to listen to the conference call
and to review the accompanying materials, which contain more
information about First Solar’s third quarter 2023 financial
results, 2023 guidance, and financial outlook.
Conference Call Details
First Solar has scheduled a conference call for today, October
31, 2023 at 4:30 p.m. ET, to discuss this announcement. A live
webcast of this conference call and accompanying materials are
available at investor.firstsolar.com. An audio replay of the
conference call will be available through Thursday, November 30,
2023, and can be accessed by dialing +1 (800) 770-2030 if you are
calling from within the United States or +1 (647) 362-9199 if you
are calling from outside the United States and entering the replay
passcode 99681. A replay of the webcast will also be available on
the Investors section of the Company’s website approximately two
hours after the conclusion of the call and remain available for 30
days.
About First Solar, Inc.
First Solar is a leading American solar technology company and
global provider of responsibly-produced eco-efficient solar modules
advancing the fight against climate change. Developed at research
and development labs in California and Ohio, the Company’s advanced
thin film photovoltaic (“PV”) modules represent the next generation
of solar technologies, providing a competitive, high-performance,
lower-carbon alternative to conventional crystalline silicon PV
panels. From raw material sourcing and manufacturing through
end-of-life module recycling, First Solar’s approach to technology
embodies sustainability and a responsibility towards people and the
planet. For more information, please visit www.firstsolar.com.
For First Solar Investors
This release contains forward-looking statements which are made
pursuant to safe harbor provisions of the Private Securities
Litigation Reform Act of 1995. All statements in this release,
other than statements of historical fact, are forward-looking
statements. These forward-looking statements include, but are not
limited to, statements concerning: demand for our technology;
increased research and development investment; new domestic and
international capacity coming online; production and delivery of
our new Series 7 modules; our financial guidance for 2023,
including future financial results, net sales, gross margin,
operating expenses, operating income, earnings per diluted share,
net cash balance, capital expenditures, volume sold, shipments,
bookings, products and our business and financial objectives for
2023; the availability of benefits under certain production linked
incentive programs, and the impact of the IRA including the total
advanced manufacturing production credit available to us under
Section 45X of the Internal Revenue Code. These forward-looking
statements are often characterized by the use of words such as
“estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,”
“seek,” “believe,” “forecast,” “foresee,” “likely,” “may,”
“should,” “goal,” “target,” “might,” “will,” “could,” “predict,”
“continue,” “contingent” and the negative or plural of these words
and other comparable terminology. Forward-looking statements are
only predictions based on our current expectations and our
projections about future events and therefore speak only as of the
date of this release. You should not place undue reliance on these
forward-looking statements. We undertake no obligation to update
any of these forward-looking statements for any reason, whether as
a result of new information, future developments or otherwise.
These forward-looking statements involve known and unknown risks,
uncertainties and other factors that may cause our actual results,
levels of activity, performance or achievements to differ
materially from those expressed or implied by our forward-looking
statements. These factors include, but are not limited to:
structural imbalances in global supply and demand for PV solar
modules; our competitive position and other key competitive
factors; the market for renewable energy, including solar energy;
the reduction, elimination, expiration or introduction of
government subsidies, policies, and support programs for solar
energy projects; the impact of public policies, such as tariffs or
other trade remedies imposed on solar cells and modules; the
passage of legislation intended to encourage renewable energy
investments through tax credits, such as the IRA; the impact of the
IRA on our expected results of operations in future periods, which
may be affected by technical guidance, regulations, subsequent
amendments or interpretations of the law; interest rate
fluctuations and both our and our customers’ ability to secure
financing; changes in the exchange rates between the functional
currencies of our subsidiaries and other currencies in which assets
and liabilities are denominated; our ability to execute on our
long-term strategic plans; the loss of any of our large customers,
or the ability of our customers and counterparties to perform under
their contracts with us; our ability to execute on our solar module
technology and cost reduction roadmaps; our ability to improve the
wattage of our solar modules; our ability to incorporate technology
improvements into our manufacturing process, including the
production of bifacial solar modules and the implementation of our
Copper Replacement (“CuRe”) program; the satisfaction of conditions
precedent in our sales agreements; our ability to attract new
customers and to develop and maintain existing customer and
supplier relationships; general economic and business conditions,
including those influenced by U.S., international, and geopolitical
events; environmental responsibility, including with respect to
cadmium telluride (“CdTe”) and other semiconductor materials;
claims under our limited warranty obligations; changes in, or the
failure to comply with, government regulations and environmental,
health, and safety requirements; effects arising from and results
of pending litigation; future collection and recycling costs for
solar modules covered by our module collection and recycling
program; supply chain disruptions, including demurrage and
detention charges; our ability to protect our intellectual
property; our ability to prevent and/or minimize the impact of
cyber-attacks or other breaches of our information systems; our
continued investment in research and development; the supply and
price of components and raw materials, including CdTe; our ability
to construct production facilities to support product lines,
including Series 6 and Series 7 module manufacturing; our ability
to avoid manufacturing interruptions, including during the ramp of
our Series 7 modules manufacturing facilities; our ability to
attract and retain key executive officers and associates; the
severity and duration of public health threats (including pandemics
such as COVID-19 and similarly infectious diseases), including the
potential impact on our business, financial condition, and results
of operations; and the matters discussed under the captions “Risk
Factors” and “Management’s Discussion and Analysis of Financial
Condition and Results of Operations” of our most recent Annual
Report on Form 10-K and our subsequently filed Quarterly Reports on
Form 10-Q, as supplemented by our other filings with the Securities
and Exchange Commission.
FIRST SOLAR, INC.
CONDENSED CONSOLIDATED BALANCE
SHEETS
(In thousands, except share
data)
(Unaudited)
September 30,
2023
December 31,
2022
ASSETS
Current assets:
Cash and cash equivalents
$
1,492,958
$
1,481,269
Marketable securities
329,516
1,096,712
Accounts receivable trade, net
753,520
324,337
Accounts receivable unbilled
33,603
30,654
Inventories
882,787
636,312
Other current assets
331,618
222,137
Total current assets
3,824,002
3,791,421
Property, plant and equipment, net
4,072,857
3,536,902
Deferred tax assets, net
133,407
78,680
Restricted marketable securities
183,700
182,070
Government grants receivable
582,202
—
Goodwill
28,473
14,462
Intangible assets, net
66,379
31,106
Inventories
261,359
260,395
Other assets
430,266
356,192
Total assets
$
9,582,645
$
8,251,228
LIABILITIES AND STOCKHOLDERS’
EQUITY
Current liabilities:
Accounts payable
$
110,795
$
341,409
Income taxes payable
33,583
29,397
Accrued expenses
600,421
382,782
Deferred revenue
372,167
263,215
Other current liabilities
46,730
21,245
Total current liabilities
1,199,105
1,038,048
Accrued solar module collection and
recycling liability
130,131
128,114
Long-term debt
464,040
184,349
Deferred revenue
1,349,602
944,725
Other liabilities
137,391
119,937
Total liabilities
3,280,269
2,415,173
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value per share;
500,000,000 shares authorized; 106,844,040 and 106,609,094 shares
issued and outstanding at September 30, 2023 and December 31, 2022,
respectively
107
107
Additional paid-in capital
2,879,412
2,887,476
Accumulated earnings
3,621,827
3,140,289
Accumulated other comprehensive loss
(198,970
)
(191,817
)
Total stockholders’ equity
6,302,376
5,836,055
Total liabilities and stockholders’
equity
$
9,582,645
$
8,251,228
FIRST SOLAR, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
(In thousands, except per
share amounts)
(Unaudited)
Three Months Ended
Nine Months Ended
September 30,
2023
June 30, 2023
September 30,
2022
September 30,
2023
September 30,
2022
Net sales
$
801,090
$
810,673
$
628,933
$
2,160,049
$
1,616,928
Cost of sales
424,915
500,253
607,951
1,361,403
1,607,683
Gross profit
376,175
310,420
20,982
798,646
9,245
Operating expenses:
Selling, general and administrative
50,172
46,328
46,368
140,528
121,990
Research and development
41,190
36,745
29,183
108,445
81,520
Production start-up
12,059
23,377
19,768
54,930
40,337
Litigation loss
—
35,590
—
35,590
—
Total operating expenses
103,421
142,040
95,319
339,493
243,847
Gain on sales of businesses, net
211
135
5,984
329
253,272
Operating income (loss)
272,965
168,515
(68,353
)
459,482
18,670
Foreign currency loss, net
(987
)
(4,652
)
(4,859
)
(11,586
)
(12,041
)
Interest income
23,254
25,026
9,749
74,102
14,954
Interest expense, net
(3,734
)
(1,415
)
(2,991
)
(5,897
)
(9,092
)
Other (expense) income, net
(1,033
)
997
4,774
(1,492
)
2,679
Income (loss) before taxes
290,465
188,471
(61,680
)
514,609
15,170
Income tax (expense) benefit
(22,067
)
(17,892
)
12,512
(33,071
)
(51,788
)
Net income (loss)
$
268,398
$
170,579
$
(49,168
)
$
481,538
$
(36,618
)
Net income (loss) per share:
Basic
$
2.51
$
1.60
$
(0.46
)
$
4.51
$
(0.34
)
Diluted
$
2.50
$
1.59
$
(0.46
)
$
4.49
$
(0.34
)
Weighted-average number of shares used in
per share calculations:
Basic
106,834
106,827
106,596
106,795
106,532
Diluted
107,498
107,278
106,596
107,326
106,532
FIRST SOLAR, INC.
CONDENSED CONSOLIDATED
STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
Nine Months Ended
September 30,
2023
2022
Cash flows from operating
activities:
Net income (loss)
$
481,538
$
(36,618
)
Adjustments to reconcile net income (loss)
to cash provided by operating activities:
Depreciation, amortization and
accretion
218,303
199,183
Impairments and net losses on disposal of
long-lived assets
304
62,793
Share-based compensation
23,209
21,121
Deferred income taxes
(46,053
)
(4,600
)
Gain on sales of businesses, net
(329
)
(253,272
)
Other, net
89
(6,998
)
Changes in operating assets and
liabilities:
Accounts receivable, trade and
unbilled
(385,046
)
177,020
Inventories
(247,729
)
(164,205
)
Project assets and PV solar power
systems
8,626
(160,300
)
Government grants receivable
(429,744
)
—
Other assets
(149,635
)
(49,071
)
Income tax receivable and payable
(16,809
)
40,902
Accounts payable and accrued expenses
121,382
(42,809
)
Deferred revenue
472,934
293,872
Other liabilities
(9,889
)
1,136
Net cash provided by operating
activities
41,151
78,154
Cash flows from investing
activities:
Purchases of property, plant and
equipment
(1,039,863
)
(576,704
)
Purchases of marketable securities
(3,220,467
)
(2,278,125
)
Proceeds from sales and maturities of
marketable securities
3,996,439
1,870,973
Proceeds from sales of businesses, net of
cash and restricted cash sold
—
363,898
Acquisitions, net of cash acquired
(35,739
)
—
Other investing activities
—
(2,561
)
Net cash used in investing activities
(299,630
)
(622,519
)
Cash flows from financing
activities:
Proceeds from borrowings under long-term
debt, net of issuance costs
307,214
297,405
Repayment of long-term debt
—
(75,896
)
Payments of tax withholdings for
restricted shares
(31,100
)
(12,048
)
Net cash provided by financing
activities
276,114
209,461
Effect of exchange rate changes on cash,
cash equivalents, restricted cash, and restricted cash
equivalents
(855
)
39,866
Net increase (decrease) in cash, cash
equivalents, restricted cash, and restricted cash equivalents
16,780
(295,038
)
Cash, cash equivalents, restricted cash,
and restricted cash equivalents, beginning of the period
1,493,462
1,455,837
Cash, cash equivalents, restricted cash,
and restricted cash equivalents, end of the period
$
1,510,242
$
1,160,799
Supplemental disclosure of noncash
investing and financing activities:
Property, plant and equipment acquisitions
funded by liabilities
$
185,064
$
163,147
Proceeds to be received from asset-based
government grants
$
152,458
$
—
Acquisitions funded by contingent
consideration
$
18,500
$
—
Proceeds to be received from sales of
businesses
$
208
$
72,689
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version on businesswire.com: https://www.businesswire.com/news/home/20231031888717/en/
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