UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN PRIVATE ISSUER
PURSUANT TO RULE 13a-16 OR 15d-16 UNDER
THE SECURITIES EXCHANGE ACT OF 1934
For the month of May 2024
Commission File Number: 001-33107
CANADIAN
SOLAR INC.
545 Speedvale Avenue West, Guelph,
Ontario, Canada N1K 1E6
(Address of principal executive office)
Indicate by check mark whether the registrant files or will file annual
reports under cover of Form 20-F or Form 40-F.
Form 20-F
x Form 40-F ¨
CANADIAN SOLAR INC.
Form 6-K
TABLE OF CONTENTS
Signature
Exhibit Index
Exhibit 99.1
SIGNATURE
Pursuant to the requirements of the Securities
Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| |
CANADIAN SOLAR INC. |
| |
|
| |
By: |
/s/ Shawn (Xiaohua) Qu |
| |
Name: |
Shawn (Xiaohua) Qu |
| |
Title: |
Chairman and Chief Executive Officer |
Date: May 9, 2024
EXHIBIT INDEX
Exhibit 99.1 — First Quarter 2024 Earnings Release
Exhibit 99.1
Canadian Solar
Reports First Quarter 2024 Results and Announces Appointment of Chief Financial Officer
Guelph, Ontario,
May 9, 2024 – Canadian Solar Inc. (“Canadian Solar” or the “Company”) (NASDAQ: CSIQ) today
announced financial results for the first quarter ended March 31, 2024.
Highlights
| · | Solar
module shipments of 6.3 GW, in line with guidance of 6.1 GW to 6.4 GW. |
| · | Net
revenues of $1.3 billion, in line with guidance of $1.2 billion to $1.4 billion. |
| · | 19.0%
gross margin, at the high end of 17% to 19% guidance range. |
| · | Net
income attributable to Canadian Solar of $12 million or $0.19 per diluted share. |
| · | Record
quarterly delivery by e-STORAGE, with revenue topping the total of 2023. |
| · | Appointment
of Mr. Xinbo Zhu as Senior Vice President and Chief Financial Officer, effective May 15,
2024. Most recently, Mr. Zhu served as Chief Supply and Risk Officer of Recurrent Energy.
Dr. Huifeng Chang, who has served as Chief Financial Officer since May 2016, will
transition into his new role within the Company as Chief Strategy Officer. |
Dr. Shawn
Qu, Chairman and CEO, commented, “Shipments, revenue, and gross margin met our expectations. We continue to apply tailored
strategies across our diverse businesses. In our module business, we are concentrating on profitable growth and expanding our market
share in key strategic markets. Demand remains robust, and we are witnessing signs of improvement in distributed generation markets and
select geographies. At Recurrent Energy, we are working to close the BlackRock investment and executing on our expansive solar and battery
energy storage project development pipeline. At the same time, our e-STORAGE platform continues to grow rapidly, as we secure contracts
in new markets and advance our proprietary technologies for both utility-scale and residential applications.”
Yan Zhuang,
President of Canadian Solar’s CSI Solar subsidiary, said, “Despite the seasonally softer first quarter, we delivered
strong results. Our strategic approach to managing volume significantly enhanced our margins. This improvement was supported by a decrease
in polysilicon prices and our continued ramping of N-type TOPCon capacity. With the rapid phaseout of PERC and the narrowing cost differential
between these technologies, TOPCon has become the market’s preferred choice. We are well-positioned, as we continue to reduce our
manufacturing costs and enhance vertical integration. Additionally, e-STORAGE delivered a record quarter, achieving volume and revenue
comparable to the totals for all of 2023.”
Ismael Guerrero,
CEO of Canadian Solar’s Recurrent Energy subsidiary, said, “Following our announcement of a $500 million capital commitment
from BlackRock in January, we have secured most requisite regulatory approvals and are expecting to obtain the rest in due course. We
are dedicated to executing our extensive project pipeline, which includes nearly 1.5 GW of solar projects currently under construction.
This quarter, we also expanded our presence in Spain with a strategic acquisition, adding over 420 MWp to our pipeline.”
Dr. Huifeng
Chang, Senior VP and CFO, added, “For the first quarter of 2024, we reported $1.3 billion in revenue, a gross margin of 19.0%,
and net income of $12 million, achieving results within our guidance. We efficiently progressed our strategic manufacturing initiatives
across vertical integration, N-type TOPCon capacity, and U.S. supply chain. Our total assets have surpassed $12 billion, driven by significant
growth in project assets and solar power systems, setting the stage for future profit generation. Finally, we concluded the quarter with
a strong cash position of $2.9 billion.”
First Quarter
2024 Results
Total module shipments
recognized as revenues in the first quarter of 2024 were 6.3 GW, up 4% year-over-year (“yoy”). Of the total, 236 MW were
shipped to the Company’s own utility-scale solar power projects.
Net revenues in
the first quarter of 2024 decreased 22% quarter-over-quarter (“qoq”) and 22% yoy to $1.3 billion. The sequential decrease
primarily reflects a decline in solar module shipment volume, a decline in module average selling price (“ASP”), partially
offset by higher battery energy storage solutions sales. The yoy decrease primarily reflects a decline in module ASP, partially offset
by higher battery energy storage solutions sales and an increase in solar module shipment volume.
Gross profit in
the first quarter of 2024 was $253 million, up 18% qoq and down 21% yoy. Gross margin in the first quarter of 2024 was 19.0%, compared
to 12.5% in the fourth quarter of 2023 and 18.7% in the first quarter of 2023. The gross margin sequential increase was primarily caused
by lower manufacturing costs, partially offset by lower module ASPs. The gross margin yoy increase was primarily driven by lower manufacturing
costs and a higher margin contribution from battery energy storage solutions sales, partially offset by lower module ASPs.
Total operating
expenses in the first quarter of 2024 were $204 million, compared to $213 million in the fourth quarter of 2023 and $172 million in the
first quarter of 2023.
Depreciation and
amortization charges in the first quarter of 2024 were $110 million, compared to $89 million in the fourth quarter of 2023 and $68 million
in the first quarter of 2023. The sequential and yoy increases were primarily driven by the Company’s continued investment in vertical
integration and incremental capacity expansion.
Net interest expense
in the first quarter of 2024 was less than $1 million, compared to $18 million in the fourth quarter of 2023 and $12 million in the first
quarter of 2023. The sequential and yoy decreases in net interest expense were mainly driven by an interest benefit deriving from the
interest income generated by anti-dumping and countervailing duty deposit refunds.
Net foreign exchange
and derivative loss in the first quarter of 2024 was $4 million, compared to a net gain of less than $1 million in the fourth quarter
of 2023 and a net loss of $13 million in the first quarter of 2023.
Net income attributable
to Canadian Solar in the first quarter of 2024 was $12 million, or $0.19 per diluted share, compared to a net loss of $1 million, or
$0.02 per diluted share, in the fourth quarter of 2023, and net income of $84 million, or $1.19 per diluted share, in the first quarter
of 2023.
Net cash flow used
in operating activities in the first quarter of 2024 was $291 million, compared to net cash flow provided by operating activities of
$190 million in the fourth quarter of 2023 and $47 million in the first quarter of 2023. The operating cash outflow primarily resulted
from increased inventories and project assets.
Total debt was
$4.3 billion as of March 31, 2024, including $2.2 billion, $1.9 billion, and $0.2 billion related to CSI Solar, Recurrent Energy,
and convertible notes respectively. Total debt increased as compared to $3.6 billion as of December 31, 2023 due to incremental
borrowings for working capital and additional vertical integration for CSI Solar, and new project development for Recurrent Energy.
Business Segments
The Company has
two business segments: Recurrent Energy and CSI Solar. The two businesses operate as follows:
| · | Recurrent
Energy is one of the world’s largest clean energy project development platforms
with 15 years of experience, having delivered over 10 GWp of solar power projects and 3.3
GWh of battery energy storage projects. It is vertically integrated and has strong expertise
in greenfield origination, development, financing, execution, operations and maintenance,
and asset management. |
| · | CSI
Solar consists of solar module and battery energy storage manufacturing, and delivery
of total system solutions, including inverters, solar system kits, and EPC (engineering,
procurement, and construction) services. CSI Solar’s e-STORAGE branded battery energy
storage business includes its utility-scale turnkey battery energy system solutions, as well
as a small but growing residential battery energy storage business. These battery energy
storage systems solutions are complemented with long-term service agreements, including future
battery capacity augmentation services. |
Recurrent Energy
Segment
As of March 31,
2024, the Company held a leading position with a total global solar development pipeline of 26 GWp and a battery energy storage development
pipeline of 56 GWh.
While Recurrent
Energy’s business model was historically predominantly develop-to-sell, the Company has been adjusting its strategy to create greater
asset value and retain greater ownership of projects in select markets to increase revenues generated through recurring income, such
as power sales, operations and maintenance, and asset management income.
The business model
consists of three key drivers:
| · | Electricity
revenue from operating portfolio to drive stable, diversified cash flows in growth markets
with stable currencies; |
| · | Asset
sales (solar power and battery energy storage) in the rest of the world to drive cash-efficient
growth model, as value from project sales will help fund growth in operating assets in stable
currency markets; and |
| · | Power
services (O&M) and asset management through long-term operations and maintenance
(“O&M”) contracts, currently with 9.3 GW of contracted projects, to drive
stable and long-term recurring earnings and synergies with the project development platform. |
In January 2024,
the Company announced a $500 million investment from BlackRock. The investment will provide Recurrent Energy with additional capital
to grow its high value project development pipeline while executing its strategy to transition from a pure developer to a developer plus
long-term owner and operator in select markets including the U.S. and Europe. This transition is expected to create a
more diversified portfolio and provide more stable long-term revenue in low-risk currencies and enable Recurrent Energy to create and
retain greater value in its own project development pipeline.
The perimeter of
the transaction includes the U.S., Canada, Spain, Italy, the U.K., France, the Netherlands, Germany, South
Africa, Brazil, Chile, Colombia, Australia, South Korea and Taiwan; and excludes Canadian Solar's project
development business in China and Japan, and certain assets in Latin America and Taiwan. Closing of the transaction
is subject to regulatory approvals and certain terms and conditions in accordance with the transaction agreements.
The $500 million investment
will represent 20% of the outstanding fully diluted shares of Recurrent Energy on an as-converted basis. Canadian Solar will
continue to own the remaining majority shares of Recurrent Energy after the closing of the investment.
Project Development
Pipeline – Solar
As of March 31,
2024, Recurrent Energy’s total solar project development pipeline was 26.3 GWp, including 1.5 GWp under construction, 5.0 GWp of
backlog, and 19.8 GWp of projects in advanced and early-stage pipelines, defined as follows:
| · | Backlog
projects are late-stage projects that have passed their risk cliff date and are expected
to start construction in the next 1-4 years. A project’s risk cliff date is the date
on which the project passes the last high-risk development stage and varies depending on
the country where it is located. This is usually after the projects have received all the
required environmental and regulatory approvals, and entered into interconnection agreements,
feed-in tariff (“FIT”) arrangements, and power purchase agreements (“PPAs”).
A significant majority of backlog projects are contracted (i.e., have secured a PPA or FIT),
and the remaining have a reasonable assurance of securing PPAs. |
| · | Advanced
pipeline projects are mid-stage projects that have secured or have more than 90% certainty
of securing an interconnection agreement. |
| · | Early-stage
pipeline projects are early-stage projects controlled by Recurrent Energy that are in
the process of securing interconnection. |
While the magnitude
of the Company’s project development pipeline is an important indicator of potential expanded power generation and battery energy
storage capacity as well as potential future revenue growth, the development of projects in its pipeline is inherently uncertain. If
the Company does not successfully complete the pipeline projects in a timely manner, it may not realize the anticipated benefits of the
projects to the extent anticipated, which could adversely affect its business, financial condition, or results of operations. In addition,
the Company’s guidance and estimates for its future operating and financial results assume the completion of certain solar projects
and battery energy storage projects that are in its pipeline. If the Company is unable to execute on its actionable pipeline, it may
miss its guidance, which could adversely affect the market price of its common shares and its business, financial condition, or results
of operations.
The following table
presents Recurrent Energy’s total solar project development pipeline.
| Solar
Project Development Pipeline (as of March 31, 2024) – MWp* | |
| Region | |
In
Construction | | |
Backlog | | |
Advanced
Pipeline | | |
Early-Stage
Pipeline | | |
Total | |
| North America | |
| 424 | | |
| 212 | | |
| 1,432 | | |
| 4,281 | | |
| 6,349 | |
| Europe, the Middle East, and
Africa (“EMEA”) | |
| 47** | | |
| 2,377 | | |
| 2,408 | | |
| 5,110 | | |
| 9,942 | |
| Latin America | |
| 896** | | |
| 867 | | |
| 83 | | |
| 2,832 | | |
| 4,678 | |
| Asia Pacific excluding China
and Japan | |
| - | | |
| 173 | | |
| 718 | | |
| 1,418 | | |
| 2,309 | |
| China | |
| 100 | | |
| 1,220** | | |
| - | | |
| 1,460 | | |
| 2,780 | |
| Japan | |
| 32 | | |
| 164 | | |
| 14 | | |
| 30 | | |
| 240 | |
| Total | |
| 1,499 | | |
| 5,013 | | |
| 4,655 | | |
| 15,131 | | |
| 26,298 | |
*All numbers are gross
MWp.
**Including 388 MWp
in construction and 159 MWp in backlog that are owned by or already sold to third parties. |
Project Development
Pipeline – Battery Energy Storage
As of March 31,
2024, Recurrent Energy’s total battery energy storage project development pipeline was 55.9 GWh, including 4.3 GWh under construction
and in backlog, and 51.6 GWh of projects in advanced and early-stage pipelines.
The table below
sets forth Recurrent Energy’s total battery energy storage project development pipeline.
| Battery
Energy Storage Project Development Pipeline (as of March 31, 2024) – MWh |
| Region | |
In
Construction | | |
Backlog | | |
Advanced
Pipeline | | |
Early-Stage
Pipeline | | |
Total | |
| North America | |
| - | | |
| 1,600 | | |
| 2,180 | | |
| 15,084 | | |
| 18,864 | |
| EMEA | |
| - | | |
| 150 | | |
| 6,057 | | |
| 18,174 | | |
| 24,381 | |
| Latin America | |
| - | | |
| 1,725 | | |
| 800 | | |
| - | | |
| 2,525 | |
| Asia Pacific excluding China
and Japan | |
| 8 | | |
| 440 | | |
| 400 | | |
| 1,240 | | |
| 2,088 | |
| China | |
| 400 | | |
| - | | |
| - | | |
| 6,000 | | |
| 6,400 | |
| Japan | |
| - | | |
| 8 | | |
| 767 | | |
| 900 | | |
| 1,675 | |
| Total | |
| 408 | | |
| 3,923 | | |
| 10,204 | | |
| 41,398 | | |
| 55,933 | |
Projects
in Operation – Solar Power and Battery Energy Storage Power Plants (Including Unconsolidated Projects)
As of March 31,
2024, the solar power plants in operation totaled around 1.2 GWp, with a combined estimated net resale value of approximately $850 million.
The estimated net resale value is based on selling prices that Recurrent Energy is currently negotiating or comparable asset sales. Battery
energy storage plants in operation totaled 600 MWh as of March 31, 2024.
| Power Plants
in Operation* |
| | |
| North
America | | |
| EMEA | | |
| Latin
America | | |
| Asia
Pacific
ex.
China
and Japan | | |
| China | | |
| Japan | | |
| Total | |
| Solar
(MWp) | |
| - | | |
| 54 | | |
| 836 | | |
| 6 | | |
| 292 | | |
| 59 | | |
| 1,247 | |
| Battery
Energy Storage (MWh) | |
| 280 | | |
| | | |
| - | | |
| 20 | | |
| 300 | | |
| - | | |
| 600 | |
*All numbers
are net MWp or MWh owned by Recurrent Energy; total gross MWp of solar projects is 1,992MWp and total gross battery energy storage projects
is 1,720 MWh, including volume that is already sold to third parties.
Operating
Results
The following table
presents select unaudited results of operations data of the Recurrent Energy segment for the periods indicated.
Recurrent
Energy Segment Financial Results (In
Thousands of U.S. Dollars, Except Percentages) |
| | |
Three
Months Ended | |
| | |
March 31,
2024 | | |
December 31,
2023 | | |
March 31,
2023 | |
| Net revenues | |
| 39,433 | | |
| 53,750 | | |
| 20,052 | |
| Cost of revenues | |
| 26,381 | | |
| 31,995 | | |
| 12,843 | |
| Gross profit | |
| 13,052 | | |
| 21,755 | | |
| 7,209 | |
| Operating
expenses | |
| 33,573 | | |
| 22,938 | | |
| 22,414 | |
| Loss
from operations* | |
| (20,521 | ) | |
| (1,183 | ) | |
| (15,205 | ) |
| Gross margin | |
| 33.1 | % | |
| 40.5 | % | |
| 36.0 | % |
| Operating margin | |
| -52.0 | % | |
| -2.2 | % | |
| -75.8 | % |
| *
Loss from operations reflects management’s allocation and estimate as some services are shared by the Company’s two business
segments. |
CSI Solar Segment
Solar Modules
and Solar System Kits
CSI Solar shipped
6.3 GW of solar modules and solar system kits to more than 70 countries in the first quarter of 2024. For the first quarter of 2024,
the top five markets ranked by shipments were China, the U.S., Pakistan, Brazil and Spain.
CSI Solar’s
revised manufacturing capacity expansion targets are set forth below.
| Solar Manufacturing Capacity, GW* |
| | | |
March 2024
Actual | | |
June 2024
Plan | | |
December 2024
Plan | |
| | Ingot | | |
| 20.4 | | |
| 20.4 | | |
| 50.4 | |
| | Wafer | | |
| 24.0 | | |
| 28.0 | | |
| 50.0 | |
| | Cell | | |
| 48.4 | | |
| 48.4 | | |
| 55.7 | |
| | Module | | |
| 58.0 | | |
| 60.0 | | |
| 61.0 | |
*Nameplate annualized
capacities at said point in time. Capacity expansion plans are subject to change without notice based on market conditions and capital
allocation plans.
e-STORAGE:
Battery Energy Storage Solutions
e-STORAGE is CSI
Solar’s utility-scale battery energy storage platform. e-STORAGE provides customers with competitive turnkey, integrated, utility-scale
battery energy storage solutions, including bankable, end-to-end, utility-scale, turnkey battery energy storage system solutions across
various applications. System performance is complemented with long-term service agreements, which include future battery capacity augmentation
services and bring in long-term, stable income.
As of March 31,
2024, e-STORAGE had a total project turnkey pipeline of around 56 GWh, which includes both contracted and in-construction projects, as
well as projects at different stages of the negotiation process. In addition, e-STORAGE had approximately 3.1 GWh of operating battery
energy storage projects contracted under long-term service agreements, all of which were battery energy storage projects previously executed
by e-STORAGE.
As of March 31,
2024, the contracted backlog, including contracted long-term service agreements, was $2.5 billion. These are signed orders with contractual
obligations to customers, providing significant earnings visibility over a multi-year period.
The table below
sets forth e-STORAGE’s manufacturing capacity expansion targets.
Battery
Energy Storage Manufacturing
Capacity, GWh* | |
March 2024
Actual | | |
December 2025
Plan | |
| SolBank | |
| 20.0 | | |
| 30.0 | |
*Nameplate annualized
capacities at said point in time. Capacity expansion plans are subject to change without notice based on market conditions and capital
allocation plans.
Operating
Results
The following table
presents select unaudited results of operations data of the CSI Solar segment for the periods indicated.
CSI
Solar Segment Financial Results* (In
Thousands of U.S. Dollars, Except Percentages) |
| | |
Three
Months Ended | |
| | |
March 31,
2024 | | |
December 31,
2023 | | |
March
31,
2023 | |
| Net revenues | |
| 1,342,153 | | |
| 1,701,320 | | |
| 1,709,730 | |
| Cost of revenues | |
| 1,094,568 | | |
| 1,494,723 | | |
| 1,394,121 | |
| Gross profit | |
| 247,585 | | |
| 206,597 | | |
| 315,609 | |
| Operating
expenses | |
| 165,113 | | |
| 166,120 | | |
| 146,151 | |
| Income
from operations | |
| 82,472 | | |
| 40,477 | | |
| 169,458 | |
| Gross margin | |
| 18.4 | % | |
| 12.1 | % | |
| 18.5 | % |
| Operating margin | |
| 6.1 | % | |
| 2.4 | % | |
| 9.9 | % |
*Include effects of both sales to third-party
customers and to the Company’s Recurrent Energy segment. Please refer to the attached financial tables for intercompany transaction
elimination information. Income from operations reflects management’s allocation and estimate as some services are shared by the
Company’s two business segments.
The table below
provides the geographic distribution of the net revenues of CSI Solar:
| CSI
Solar Net Revenues Geographic Distribution* (In Millions of U.S. Dollars, Except Percentages) |
| | |
Q1
2024 | | |
%
of Net
Revenues | | |
Q4
2023 | | |
%
of Net
Revenues | | |
Q1
2023 | | |
%
of Net
Revenues | |
| Americas | |
| 676 | | |
| 53 | | |
| 579 | | |
| 35 | | |
| 632 | | |
| 38 | |
| Asia | |
| 417 | | |
| 32 | | |
| 738 | | |
| 45 | | |
| 555 | | |
| 33 | |
| Europe
and others | |
| 197 | | |
| 15 | | |
| 331 | | |
| 20 | | |
| 494 | | |
| 29 | |
| Total | |
| 1,290 | | |
| 100 | | |
| 1,648 | | |
| 100 | | |
| 1,681 | | |
| 100 | |
*Excludes sales
from CSI Solar to Recurrent Energy.
Business Outlook
The Company’s
business outlook is based on management’s current views and estimates given factors such as existing market conditions, order book,
production capacity, input material prices, foreign exchange fluctuations, the anticipated timing of project sales, and the global economic
environment. This outlook is subject to uncertainty with respect to, among other things, customer demand, project construction and sale
schedules, product sales prices and costs, supply chain constraints, and geopolitical conflicts. Management’s views and estimates
are subject to change without notice.
For the second
quarter of 2024, the Company expects total revenue to be in the range of $1.5 billion to $1.7 billion. Gross margin is expected to be
between 16% and 18%. Total module shipments recognized as revenues by CSI Solar are expected to be in the range of 7.5 GW to 8.0 GW,
including approximately 100 MW to the Company’s own projects. Total battery energy storage shipments by CSI Solar in the second
quarter of 2024 are expected to be between 1.4 GWh to 1.6 GWh, including about 800 MWh to the Company’s own projects.
For the full year
of 2024, the Company expects total module shipments to be in the range of 35 GW to 40 GW and CSI Solar’s total battery energy storage
shipments in the range of 6.0 GWh to 6.5 GWh, including approximately 2 GW and 2.5 GWh respectively to the Company’s own projects.
The Company’s total revenue is expected to be in the range of $7.3 billion to $8.3 billion.
Dr. Shawn
Qu, Chairman and CEO, commented, “Our updated shipment and revenue guidance reaffirms our commitment to profitable growth,
as we strategically manage volume to protect our margins in a difficult macroenvironment. With the market continuing to rebalance, we
remain hopeful about improving economics in the second half of the year, driven by both price normalization and further reductions to
our manufacturing costs. Canadian Solar is well-equipped to weather this cycle, thanks to our continual investment in technological innovation;
strong position with e-STORAGE, on track to achieve a record-breaking year; and Recurrent Energy, poised to implement its business model
transformation.”
Recent Developments
Canadian Solar
On May 8,
2024, Canadian Solar announced it won three battery storage system (“BESS”) projects, totaling 193 MW, in Japan’s first
Long-Term Decarbonization Power Source Auction (“LTDA”). Canadian Solar secured 13.3% of the total awarded energy storage
projects.
On April 29,
2024, Canadian Solar announced it won Environmental Finance’s Green Project Bond of the Year award for its JPY18.5 billion ($120
million) green samurai private placement issued in 2023. The bond empowers Canadian Solar’s global development business, Recurrent
Energy, to grow its solar and battery energy storage projects under development and asset management business. Environmental Finance
is an industry-leading global publication, and its annual Sustainable Debt Awards celebrate leading green, social, sustainable and sustainability-linked
bond and loan deals and recognize market innovations.
On April 17,
2024, Canadian Solar announced it was awarded a Silver rating from EcoVadis, one of the world's largest and most trusted providers
of business sustainability ratings, headquartered in Paris, France. The rating score also placed Canadian Solar in the
top 5% of companies rated by EcoVadis within the company's industry. Notably, within the industry, Canadian Solar ranked
among the top 3% and top 4% for environment and sustainable procurement, respectively.
Recurrent Energy
On April 15,
2024, Canadian Solar announced it secured 343 million Brazilian reais (approximately $70 million) of non-recourse project financing
from Banco do Nordeste do Brasil S.A. (BNB) to support construction and operation of its 152 MWp Jaiba III solar project in Brazil.
Recurrent has secured a 15-year, inflation-adjusted power purchase agreement for the project through a private auction with Usiminas,
the leading flat steel company in Brazil. The project is currently under construction and is expected to be in operation in the
fourth quarter of 2024.
On April 3,
2024, Canadian Solar announced it secured a multi-currency facility of up to €110 million ($120 million) from a group of international
banks led by Investec Bank Plc. The facility consists of a €55 million term loan and a €55 million revolving credit facility
with a total duration of three years. The funding will support Recurrent Energy in the execution of its global solar PV and energy storage
project pipeline, as it transitions to become an independent power producer (IPP) and accelerates its growth strategy.
On March 20,
2024, Canadian Solar announced the acquisition of a solar PV portfolio in the south of Spain, with a capacity of more than 420 MWp. The
portfolio is located in Carmona, a municipality in Seville (Andalusia) and consists of a cluster of four projects, Rey I, II, III,
and IV. These projects are currently under construction and will feature Canadian Solar TopBiHiKu 7 N-type bifacial TOPCon technology
modules.
Conference Call Information
The Company will hold a conference call on Thursday, May 9, 2024, at 8:00 a.m. U.S. Eastern Time (8:00 p.m., Thursday,
May 9, 2024, in Hong Kong) to discuss its first quarter 2024 results and business outlook. The dial-in phone number for the live
audio call is +1-800-717-1738 (toll-free from the U.S.), +852 5808 0636 (from Hong Kong), +86 010 8783 3254 (local dial-in
from Mainland China) or +1-646-307-1865 from international locations. The conference ID is 60603. A live webcast of the conference call
will also be available on the investor relations section of Canadian Solar's website.
A replay of the call will be available
after the conclusion of the call until 11:00 p.m. U.S. Eastern Time on Thursday, May 23, 2024 (11:00 a.m. May 24,
2024, in Hong Kong) and can be accessed by dialing +1-844-512-2921 (toll-free from the U.S.) or +1-412-317-6671 from international
locations. The replay pin number is 1160603. A webcast replay will also be available on the investor relations section of Canadian
Solar's at www.canadiansolar.com.
About Canadian
Solar Inc.
Canadian Solar
was founded in 2001 in Canada and is one of the world’s largest solar technology and renewable energy companies. It is a leading
manufacturer of solar photovoltaic modules, provider of solar energy and battery energy storage solutions, and developer of utility-scale
solar power and battery energy storage projects with a geographically diversified pipeline in various stages of development. Over the
past 23 years, Canadian Solar has successfully delivered over 125 GW of premium-quality, solar photovoltaic modules to customers across
the world. Likewise, since entering the project development business in 2010, Canadian Solar has developed, built, and connected over
10 GWp of solar power projects and 3.3 GWh of battery energy storage projects across the world. Currently, the Company has over 1.2 GWp
of solar power projects in operation, 6.5 GWp of projects under construction or in backlog (late-stage), and an additional 19.8 GWp of
projects in advanced and early-stage pipeline. In addition, the Company has 600 MWh of battery energy storage projects in operation and
a total battery energy storage project development pipeline of around 56 GWh, including approximately 4.3 GWh under construction or in
backlog, and an additional 51.6 GWh at advanced and early-stage development. Canadian Solar is one of the most bankable companies in
the solar and renewable energy industry, having been publicly listed on the NASDAQ since 2006. For additional information about
the Company, follow Canadian Solar on LinkedIn or visit www.canadiansolar.com.
Safe Harbor/Forward-Looking Statements
Certain statements
in this press release, including those regarding the Company’s expected future shipment volumes, revenues, gross margins, and project
sales are forward-looking statements that involve a number of risks and uncertainties that could cause actual results to differ materially.
These statements are made under the “Safe Harbor” provisions of the U.S. Private Securities Litigation Reform Act of 1995.
In some cases, you can identify forward-looking statements by such terms as “believes,” “expects,” “anticipates,”
“intends,” “estimates,” the negative of these terms, or other comparable terminology. Factors that could cause
actual results to differ include general business, regulatory and economic conditions and the state of the solar power and battery energy
storage market and industry; geopolitical tensions and conflicts, including impasses, sanctions and export controls; volatility, uncertainty,
delays and disruptions related to global pandemics; supply chain disruptions; governmental support for the deployment of solar power
and battery energy storage; future available supplies of silicon, solar wafers and lithium cells; demand for end-use products by consumers
and inventory levels of such products in the supply chain; changes in demand from significant customers; changes in demand from major
markets such as China, the U.S., Europe, Brazil and Japan; changes in effective tax rates; changes in customer order patterns; changes
in product mix; changes in corporate responsibility, especially environmental, social and governance (“ESG”) requirements;
capacity utilization; level of competition; pricing pressure and declines in or failure to timely adjust average selling prices; delays
in new product introduction; delays in utility-scale project approval process; delays in utility-scale project construction; delays in
the completion of project sales; the pipeline of projects and timelines related to them; the ability of the parties to optimize value
of that pipeline; continued success in technological innovations and delivery of products with the features that customers demand; shortage
in supply of materials or capacity requirements; availability of financing; exchange and inflation rate fluctuations; litigation and
other risks as described in the Company’s filings with the Securities and Exchange Commission, including its annual report on Form 20-F
filed on April 26, 2024. Although the Company believes that the expectations reflected in the forward-looking statements are reasonable,
it cannot guarantee future results, level of activity, performance, or achievements. Investors should not place undue reliance on these
forward-looking statements. All information provided in this press release is as of today’s date, unless otherwise stated, and
Canadian Solar undertakes no duty to update such information, except as required under applicable law.
Investor Relations Contact:
Wina Huang
Investor Relations
Canadian Solar Inc.
investor@canadiansolar.com
FINANCIAL TABLES
FOLLOW
The following tables provide unaudited
select financial data for the Company’s CSI Solar and Recurrent Energy businesses.
| | |
Select Financial
Data – CSI Solar and Recurrent Energy | |
| | |
Three
Months Ended and As of March 31, 2024
(In
Thousands of U.S. Dollars, Except Percentages) | |
| | |
CSI
Solar | | |
Recurrent
Energy | | |
Elimination
and
unallocated
items (1) | | |
Total | |
| Net revenues | |
$ | 1,342,153 | | |
$ | 39,433 | | |
$ | (52,475 | ) | |
$ | 1,329,111 | |
| Cost of revenues | |
| 1,094,568 | | |
| 26,381 | | |
| (44,591 | ) | |
| 1,076,358 | |
| Gross profit | |
| 247,585 | | |
| 13,052 | | |
| (7,884 | ) | |
| 252,753 | |
| Gross margin | |
| 18.4 | % | |
| 33.1 | % | |
| — | | |
| 19.0 | % |
| Income
(loss) from operations (2) | |
$ | 82,472 | | |
$ | (20,521 | ) | |
$ | (12,879 | ) | |
$ | 49,072 | |
| | |
| | | |
| | | |
| | | |
| | |
| Supplementary Information: | |
| | | |
| | | |
| | | |
| | |
| Interest
expense (3) | |
$ | (15,709 | ) | |
$ | (14,289 | ) | |
$ | (4,869 | ) | |
$ | (34,867 | ) |
| Interest
income (3) | |
| 31,869 | | |
| 2,404 | | |
| 29 | | |
| 34,302 | |
| | |
| | | |
| | | |
| | | |
| | |
| Cash and cash equivalents | |
$ | 1,819,182 | | |
$ | 251,421 | | |
$ | 6,889 | | |
$ | 2,077,492 | |
| Restricted cash – current
and noncurrent | |
| 815,776 | | |
| 865 | | |
| — | | |
| 816,641 | |
| Non-recourse borrowings | |
| — | | |
| 480,799 | | |
| — | | |
| 480,799 | |
| Other short-term and long-term
borrowings | |
| 2,036,675 | | |
| 1,251,319 | | |
| — | | |
| 3,287,994 | |
| Green bonds and convertible
notes | |
| — | | |
| 152,520 | | |
| 227,793 | | |
| 380,313 | |
| | |
Select Financial
Data – CSI Solar and Recurrent Energy | |
| | |
Three
Months Ended March 31, 2023
(In Thousands of U.S. Dollars, Except Percentages) | |
| | |
CSI
Solar | | |
Recurrent
Energy | | |
Elimination
and
unallocated
items (1) | | |
Total | |
| Net revenues | |
$ | 1,709,730 | | |
$ | 20,052 | | |
$ | (28,501 | ) | |
$ | 1,701,281 | |
| Cost of revenues | |
| 1,394,121 | | |
| 12,843 | | |
| (23,684 | ) | |
| 1,383,280 | |
| Gross profit | |
| 315,609 | | |
| 7,209 | | |
| (4,817 | ) | |
| 318,001 | |
| Gross margin | |
| 18.5 | % | |
| 36.0 | % | |
| — | | |
| 18.7 | % |
| Income
(loss) from operations (2) | |
$ | 169,458 | | |
$ | (15,205 | ) | |
$ | (8,649 | ) | |
$ | 145,604 | |
| | |
| | | |
| | | |
| | | |
| | |
| Supplementary Information: | |
| | | |
| | | |
| | | |
| | |
| Interest
expense (3) | |
$ | (13,588 | ) | |
$ | (5,065 | ) | |
$ | (1,795 | ) | |
$ | (20,448 | ) |
| Interest
income (3) | |
| 6,477 | | |
| 1,452 | | |
| 27 | | |
| 7,956 | |
(1) Includes
inter-segment elimination, and unallocated corporate items not considered part of management’s evaluation of business segment operating
performance.
(2) Income (loss) from operations
reflects management’s allocation and estimate as some services are shared by the Company’s two business segments.
(3) Represents interest expenses
payable to and interest income earned from third parties.
| | |
Select Financial
Data - CSI Solar and Recurrent Energy | |
| | |
Three
Months
Ended
March 31,
2024 | | |
Three
Months
Ended
December 31,
2023 | | |
Three
Months
Ended
March 31,
2023 | |
| | |
(In Thousands
of U.S. Dollars) | |
| CSI Solar Revenues: | |
| | | |
| | | |
| | |
| Solar
modules | |
$ | 912,150 | | |
$ | 1,243,066 | | |
$ | 1,454,876 | |
| Solar
system kits | |
| 99,247 | | |
| 144,492 | | |
| 133,587 | |
| Battery
energy storage solutions | |
| 251,473 | | |
| 195,899 | | |
| 14,810 | |
| EPC
and others | |
| 26,808 | | |
| 64,830 | | |
| 77,956 | |
| Subtotal | |
| 1,289,678 | | |
| 1,648,287 | | |
| 1,681,229 | |
| Recurrent Energy Revenues: | |
| | | |
| | | |
| | |
| Solar
power and battery energy storage asset sales | |
| 6,044 | | |
| 21,449 | | |
| 4,621 | |
| Power
services (O&M) and asset management | |
| 15,868 | | |
| 15,910 | | |
| 8,687 | |
| Electricity
revenue from operating portfolio and others | |
| 17,521 | | |
| 16,391 | | |
| 6,744 | |
| Subtotal | |
| 39,433 | | |
| 53,750 | | |
| 20,052 | |
| Total
net revenues | |
$ | 1,329,111 | | |
$ | 1,702,037 | | |
$ | 1,701,281 | |
| Canadian
Solar Inc. |
| Unaudited
Condensed Consolidated Statements of Operations |
| (In Thousands
of U.S. Dollars, Except Share and Per Share Data) |
| | |
Three
Months Ended | |
| | |
March 31, | | |
December 31, | | |
March 31, | |
| | |
2024 | | |
2023 | | |
2023 | |
| Net revenues | |
$ | 1,329,111 | | |
$ | 1,702,037 | | |
$ | 1,701,281 | |
| Cost of revenues | |
| 1,076,358 | | |
| 1,488,633 | | |
| 1,383,280 | |
| Gross
profit | |
| 252,753 | | |
| 213,404 | | |
| 318,001 | |
| | |
| | | |
| | | |
| | |
| Operating expenses: | |
| | | |
| | | |
| | |
| Selling and distribution expenses | |
| 88,412 | | |
| 93,847 | | |
| 88,371 | |
| General and administrative expenses | |
| 94,693 | | |
| 108,236 | | |
| 78,648 | |
| Research and development expenses | |
| 34,279 | | |
| 31,503 | | |
| 17,307 | |
| Other operating
income, net | |
| (13,703 | ) | |
| (20,759 | ) | |
| (11,929 | ) |
| Total
operating expenses | |
| 203,681 | | |
| 212,827 | | |
| 172,397 | |
| | |
| | | |
| | | |
| | |
| Income
from operations | |
| 49,072 | | |
| 577 | | |
| 145,604 | |
| Other income (expenses): | |
| | | |
| | | |
| | |
| Interest expense | |
| (34,867 | ) | |
| (33,247 | ) | |
| (20,448 | ) |
| Interest income | |
| 34,302 | | |
| 15,632 | | |
| 7,956 | |
| Gain (loss) on change in fair
value of derivatives, net | |
| (16,694 | ) | |
| (7,039 | ) | |
| 7,601 | |
| Foreign exchange gain (loss),
net | |
| 12,913 | | |
| 7,058 | | |
| (20,860 | ) |
| Investment
income, net | |
| 169 | | |
| 1,965 | | |
| 8,380 | |
| Total
other expenses | |
| (4,177 | ) | |
| (15,631 | ) | |
| (17,371 | ) |
| | |
| | | |
| | | |
| | |
| Income (loss) before income
taxes and equity in earnings of affiliates | |
| 44,895 | | |
| (15,054 | ) | |
| 128,233 | |
| Income tax benefit (expense) | |
| (9,677 | ) | |
| 4,650 | | |
| (28,715 | ) |
| Equity
in earnings of affiliates | |
| 1,005 | | |
| 7,204 | | |
| 7,311 | |
| Net income (loss) | |
| 36,223 | | |
| (3,200 | ) | |
| 106,829 | |
| | |
| | | |
| | | |
| | |
| Less:
Net income (loss) attributable to non-controlling interests | |
| 23,871 | | |
| (1,814 | ) | |
| 23,117 | |
| | |
| | | |
| | | |
| | |
| Net
income (loss) attributable to Canadian Solar Inc. | |
$ | 12,352 | | |
$ | (1,386 | ) | |
$ | 83,712 | |
| | |
| | | |
| | | |
| | |
| Earnings (loss) per share - basic | |
$ | 0.19 | | |
$ | (0.02 | ) | |
$ | 1.30 | |
| Shares used in computation -
basic | |
| 66,164,560 | | |
| 66,035,331 | | |
| 64,517,935 | |
| Earnings (loss) per share - diluted | |
$ | 0.19 | | |
$ | (0.02 | ) | |
$ | 1.19 | |
| Shares used in computation -
diluted | |
| 66,642,725 | | |
| 66,035,331 | | |
| 71,424,749 | |
| Canadian
Solar Inc. |
| Unaudited
Condensed Consolidated Statement of Comprehensive Income (Loss) |
| (In Thousands
of U.S. Dollars) |
| | |
Three
Months Ended | |
| | |
March 31, | | |
December 31, | | |
March 31, | |
| | |
2024 | | |
2023 | | |
2023 | |
| Net Income
(loss) | |
$ | 36,223 | | |
$ | (3,200 | ) | |
$ | 106,829 | |
| Other comprehensive income
(loss): | |
| | | |
| | | |
| | |
| Foreign currency translation
adjustment | |
| (53,813 | ) | |
| 82,692 | | |
| 23,250 | |
| Gain (loss) on changes in fair
value of available-for-sale debt securities, net of tax | |
| 880 | | |
| (2,897 | ) | |
| 339 | |
| Gain (loss) on interest rate
swap, net of tax | |
| 965 | | |
| (2,821 | ) | |
| (105 | ) |
| Share of
gain (loss) on changes in fair value of derivatives of affiliate, net of tax | |
| 1,134 | | |
| 3,074 | | |
| (610 | ) |
| Comprehensive income (loss) | |
| (14,611 | ) | |
| 76,848 | | |
| 129,703 | |
| Less: comprehensive
income attributable to non-controlling interests | |
| 20,337 | | |
| 17,324 | | |
| 25,162 | |
| Comprehensive
income (loss) attributable to Canadian Solar Inc. | |
$ | (34,948 | ) | |
$ | 59,524 | | |
$ | 104,541 | |
| Canadian
Solar Inc. |
| Unaudited
Condensed Consolidated Balance Sheets |
| (In Thousands
of U.S. Dollars) |
| | |
March 31, | | |
December 31, | |
| | |
2024 | | |
2023 | |
| ASSETS | |
| | |
| |
| Current assets: | |
| | |
| |
| Cash and cash equivalents | |
$ | 2,077,492 | | |
$ | 1,938,689 | |
| Restricted cash | |
| 812,145 | | |
| 999,933 | |
| Accounts receivable trade, net | |
| 809,398 | | |
| 904,943 | |
| Accounts receivable, unbilled | |
| 125,538 | | |
| 101,435 | |
| Amounts due from related parties | |
| 35,260 | | |
| 40,582 | |
| Inventories | |
| 1,394,996 | | |
| 1,179,641 | |
| Value added tax recoverable | |
| 168,622 | | |
| 162,737 | |
| Advances to suppliers, net | |
| 228,547 | | |
| 193,818 | |
| Derivative assets | |
| 4,004 | | |
| 9,282 | |
| Project assets | |
| 277,945 | | |
| 280,793 | |
| Prepaid
expenses and other current assets | |
| 243,751 | | |
| 283,600 | |
| Total current assets | |
| 6,177,698 | | |
| 6,095,453 | |
| Restricted cash | |
| 4,496 | | |
| 7,810 | |
| Property, plant and equipment,
net | |
| 3,052,995 | | |
| 3,088,442 | |
| Solar power systems, net | |
| 1,164,625 | | |
| 951,513 | |
| Deferred tax assets, net | |
| 277,923 | | |
| 263,458 | |
| Advances to suppliers, net | |
| 201,178 | | |
| 132,218 | |
| Investments in affiliates | |
| 237,521 | | |
| 236,928 | |
| Intangible assets, net | |
| 35,390 | | |
| 19,727 | |
| Project assets | |
| 703,702 | | |
| 576,793 | |
| Right-of-use assets | |
| 232,282 | | |
| 237,007 | |
| Amounts due from related parties | |
| 38,282 | | |
| 32,313 | |
| Other non-current
assets | |
| 240,678 | | |
| 254,098 | |
| TOTAL
ASSETS | |
$ | 12,366,770 | | |
$ | 11,895,760 | |
| Canadian
Solar Inc. |
| Unaudited
Condensed Consolidated Balance Sheets (Continued) |
| (In Thousands
of U.S. Dollars) |
| | |
March 31, | | |
December 31, | |
| | |
2024 | | |
2023 | |
| LIABILITIES AND EQUITY | |
| | | |
| | |
| Current liabilities: | |
| | | |
| | |
| Short-term borrowings | |
$ | 2,180,348 | | |
$ | 1,805,198 | |
| Accounts payable | |
| 818,189 | | |
| 813,677 | |
| Short-term notes payable | |
| 895,607 | | |
| 878,285 | |
| Amounts due to related parties | |
| 1,016 | | |
| 511 | |
| Other payables | |
| 1,278,844 | | |
| 1,359,679 | |
| Advances from customers | |
| 362,323 | | |
| 392,308 | |
| Derivative liabilities | |
| 10,005 | | |
| 6,702 | |
| Operating lease liabilities | |
| 19,497 | | |
| 20,204 | |
| Other current
liabilities | |
| 472,659 | | |
| 587,827 | |
| Total current liabilities | |
| 6,038,488 | | |
| 5,864,391 | |
| Long-term borrowings | |
| 1,588,445 | | |
| 1,265,965 | |
| Green bonds and convertible
notes | |
| 380,313 | | |
| 389,033 | |
| Liability for uncertain tax
positions | |
| 5,847 | | |
| 5,701 | |
| Deferred tax liabilities | |
| 82,637 | | |
| 82,828 | |
| Operating lease liabilities | |
| 111,606 | | |
| 116,846 | |
| Other non-current
liabilities | |
| 468,018 | | |
| 465,752 | |
| TOTAL
LIABILITIES | |
| 8,675,354 | | |
| 8,190,516 | |
| Equity: | |
| | | |
| | |
| Common shares | |
| 835,543 | | |
| 835,543 | |
| Additional paid-in capital | |
| 298,480 | | |
| 292,737 | |
| Retained earnings | |
| 1,562,059 | | |
| 1,549,707 | |
| Accumulated
other comprehensive loss | |
| (166,044 | ) | |
| (118,744 | ) |
| Total Canadian Solar Inc.
shareholders’ equity | |
| 2,530,038 | | |
| 2,559,243 | |
| Non-controlling
interests | |
| 1,161,378 | | |
| 1,146,001 | |
| TOTAL
EQUITY | |
| 3,691,416 | | |
| 3,705,244 | |
| TOTAL
LIABILITIES AND EQUITY | |
$ | 12,366,770 | | |
$ | 11,895,760 | |
| Canadian
Solar Inc. |
| Unaudited
Condensed Statements of Cash Flows |
| (In Thousands
of U.S. Dollars) |
| | |
Three
Months Ended | |
| | |
March 31, | | |
December 31, | | |
March 31, | |
| | |
2024 | | |
2023 | | |
2023 | |
| Operating Activities: | |
| | | |
| | | |
| | |
| Net income (loss) | |
$ | 36,223 | | |
$ | (3,200 | ) | |
$ | 106,829 | |
| Adjustments
to reconcile net income to net cash (used in) provided by operating activities | |
| 158,350 | | |
| 171,051 | | |
| 67,738 | |
| Changes
in operating assets and liabilities | |
| (486,060 | ) | |
| 22,146 | | |
| (127,395 | ) |
| Net cash (used in) provided
by operating activities | |
| (291,487 | ) | |
| 189,997 | | |
| 47,172 | |
| | |
| | | |
| | | |
| | |
| Investing Activities: | |
| | | |
| | | |
| | |
| Purchase of property, plant
and equipment | |
| (266,462 | ) | |
| (295,086 | ) | |
| (233,032 | ) |
| Purchase of solar power systems | |
| (173,341 | ) | |
| (183,277 | ) | |
| (109,866 | ) |
| Other investing
activities | |
| 6,832 | | |
| (17,011 | ) | |
| (11,083 | ) |
| Net cash used in investing activities | |
| (432,971 | ) | |
| (495,374 | ) | |
| (353,981 | ) |
| | |
| | | |
| | | |
| | |
| Financing Activities: | |
| | | |
| | | |
| | |
| Other financing
activities | |
| 723,412 | | |
| 222,216 | | |
| 379,749 | |
| Net cash
provided by financing activities | |
| 723,412 | | |
| 222,216 | | |
| 379,749 | |
| Effect
of exchange rate changes | |
| (51,253 | ) | |
| 36,561 | | |
| 33,090 | |
| Net increase (decrease) in cash,
cash equivalents and restricted cash | |
| (52,299 | ) | |
| (46,600 | ) | |
| 106,030 | |
| Cash,
cash equivalents and restricted cash at the beginning of the period | |
$ | 2,946,432 | | |
$ | 2,993,032 | | |
$ | 1,969,503 | |
| Cash,
cash equivalents and restricted cash at the end of the period | |
$ | 2,894,133 | | |
$ | 2,946,432 | | |
$ | 2,075,533 | |
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