JA Solar Reports 3/30 Fourth Quarter and Full Year 2006 Results
Friday March 30, 7:00 am ET
100% of Silicon Wafer Supply Contractually Secured for 2007; On Track to More Than Double Solar Cell Manufacturing Capacity in 2007
HEBEI, China, March 30, 2007 (PRIME NEWSWIRE) -- JA Solar Holdings Co., Ltd. (``JA Solar'', ``the Company'') (NasdaqGM:JASO - News) today reported financial results for the fourth quarter and year ended December 31, 2006.
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Fourth Quarter Results
Revenues for the fourth quarter 2006 were RMB349.40 million (US$44.77 million), compared to revenues of nil for the fourth quarter 2005, and RMB247.96 million (US$31.77 million) in the third quarter 2006.
Net income available to ordinary shareholders for the fourth quarter 2006 was RMB66.86 million (US$8.57 million) compared to a net loss of RMB1.44 million (US$0.18 million) for the fourth quarter 2005, and net income of RMB4.14 million (US$0.53 million) for the third quarter 2006.
For the fourth quarter 2006 basic and diluted earnings per ADS were RMB2.51 (US$0.321) and RMB2.45 (US$0.314), respectively. Each ADS represents three of our ordinary shares.
The fourth quarter 2006 included share-based compensation expense of RMB1.65 million (US$0.21 million), or RMB0.055 (US$0.007) per diluted ADS.
2006 Full Year Results
Revenues for the full year 2006 were RMB696.46 million (US$89.24 million), compared to revenues of nil for the period from inception (May 18, 2005) to December 31, 2005.
Net income available to ordinary shareholders for the full year 2006 was RMB86.40 million (US$11.07 million), compared to a net loss of RMB3.11 million (US$0.40) million, for the period from inception (May 18, 2005) to December 31, 2005.
For the full year 2006 basic and diluted earnings per ADS were RMB3.24 (US$0.415) and RMB3.23 (US$0.414), respectively.
The full year 2006 included share-based compensation expense of RMB18.18 million (US$2.33 million), or RMB0.680 (US$0.087) per diluted ADS. Diluted earnings per ADS calculations for the full year 2006 were based on 26.72 million weighted average number of ADSs outstanding, compared to 26.67 million ADSs in the year ago period.
The conversion of Renminbi into U.S. dollars for the full year of 2006 and the fourth quarter of 2006 in this release, made solely for the convenience of the reader, is based on the noon buying rate in The City of New York for cable transfers of Renminbi as certified for customs purposes by the Federal Reserve Bank of New York as of December 31, 2006, which was RMB7.8041 to US$1.00. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized or settled into U.S. dollars at that rate on December 31, 2006, or at any other date. The percentages stated in this press release are calculated based on Renminbi.
Samuel Yang, JA Solar's Chief Executive Officer, said, ``We continue to build on the substantial momentum in our business. We are successfully establishing JA Solar as one of the world's premier solar cell brands. Our recent initial public offering was very well received and a benchmark event. We now have adequate funding in place to secure the high-quality silicon supply critical to our growth. We brought 75MW of production online as planned in 2006. We are on track to more than double that, with the planned addition of another 100MW in 2007 as we continue to execute on our growth plan by meeting the cell needs of our customers worldwide.''
Herman Zhao, JA Solar's Chief Financial Officer, said, ``At this time, we have 100% of our silicon wafer supply contractually secured for 2007. We are carefully managing all aspects of our growth. We continue to leverage our purchasing scale and long-term supply and purchase agreements. We are also seeking increased operational efficiencies where possible, as we work to maintain a stable gross margin level.''
In February 2007, the Company completed its IPO, generating net proceeds of US$209.1 million, net of listing expenses. The underwriters exercised their over-allotment option for the purchase of additional ADSs, generating net proceeds of US$31.4 million. The Company intends to use the proceeds to purchase raw materials, to expand its existing production capacity, to repay its short-term debt obligations, to enhance its research and development capabilities and for general working capital purposes. Upon the consummation of the IPO in February 2007, all of the Company's outstanding 6,520,000 Series A preference shares were automatically converted into 6,520,000 ordinary shares
2007 Outlook
Based on current market conditions and customer forecasts, the Company expects production for 2007 to be approximately 100MW. This would result in revenues for the full year 2007 in the range of approximately RMB2,128 million (US$280 million) to RMB2,205 million (US$290 million), with a gross margin expected to be approximately 19.5%. For the first quarter 2007, JA Solar expects revenue to be in the range of RMB301 million (US$39 million) to RMB317 million (US$41 million), with gross margin expected to be approximately 21%. The Company expects its share based compensation for first quarter 2007 to be approximately RMB 1.87 million (US$0.24 million), or RMB0.049 (US$ 0.006) per diluted ADS.
Investor Conference Call / Webcast Details
A conference call has been scheduled for 9:00 p.m. on Friday, March 30, 2007 (in Hebei). This will be 9:00 a.m. on Friday, March 30, in New York. During the call, time will be set-aside for analysts and interested investors to ask questions of executive officers.
The call may be accessed by dialing +1-201-689-8560. A live webcast of the conference call will be available on the Company's website at jasolar.com. The playback will be available beginning two hours after the live call and will be accessible by dialing +1-201-612-7415. The account number to access the replay is 3055 and the passcode is 235813.
About JA Solar Holdings Co., Ltd.
Based in Hebei, China, JA Solar Holdings Co., Ltd. is an emerging and fast-growing manufacturer of high-performance, monocrystalline solar cells. The Company sells its products to solar module manufacturers who assemble and integrate its solar cells into modules and systems that convert sunlight into electricity. For more information visit jasolar.com.
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by words such as ``will,'' ``may,'' ``expect,'' ``anticipate,'' ``aim,'' ``intend,'' ``plan,'' ``believe,'' ``estimate,'' ``potential,'' ``continue,'' and other similar statements. Statements other than statements of historical facts in this announcement are forward-looking statements, including but not limited to, our expectations regarding the expansion of our manufacturing capacities, our future business development, our beliefs regarding our production output, our forecasts on revenue, production output and our share based compensation for 2007 or part thereof. These forward-looking statements involve known and unknown risks and uncertainties and are based on current expectations, assumptions, estimates and projections about the Company and the industry. Further information regarding these and other risks is included in our registration statement on Form F-1 and other documents filed with the Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that its expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
Quarter Ended
----------------------------------------------------
December 31, 2005 September 30, 2006
RMB USD RMB USD
(unaudited) (unaudited)
----------------------------------------------------
Revenue from
third parties -- -- 226,487,802 29,021,643
Revenue from
related
parties -- -- 21,474,267 2,751,665
---------- -------- ------------ -----------
Total revenues -- -- 247,962,069 31,773,307
Cost of
revenues -- -- (182,883,659) (23,434,305)
---------- -------- ------------ -----------
Gross profit -- -- 65,078,410 8,339,003
Selling,
general and
administrative
expenses (1,292,465) (165,614) (24,497,619) (3,139,070)
Research and
development
expenses (141,278) (18,103) (393,384) (50,407)
---------- -------- ------------ -----------
Total
operating
expenses (1,433,743) (183,717) (24,891,003) (3,189,478)
---------- -------- ------------ -----------
Income/ (loss)
from
operations (1,433,743) (183,717) 40,187,407 5,149,525
---------- -------- ------------ -----------
Interest
expense -- -- (1,057,834) (135,548)
Interest
income 32,889 4,214 317,303 40,659
Other income -- -- -- --
Foreign
exchange
gain/ (loss) (41,274) (5,289) 152,627 19,557
---------- -------- ------------ -----------
Income/ (loss)
before income
taxes (1,442,128) (184,791) 39,599,503 5,074,192
Income tax
benefit/
(expense) -- -- -- --
---------- -------- ------------ -----------
Net income/
(loss) (1,442,128) (184,791) 39,599,503 5,074,192
---------- -------- ------------ -----------
Preferred
shares
accretion -- -- (489,600) (62,736)
Preferred
shares
beneficial
conversion
charge -- -- (34,732,133) (4,450,498)
Allocation of
income to
participating
preferred
shareholders -- -- (233,246) (29,888)
---------- -------- ------------ -----------
Net income
available to
ordinary
shareholders (1,442,128) (184,791) 4,144,524 531,070
========== ======== ============ ===========
Net income/
(loss) per
ordinary
shares
Basic (0.02) (0.002) 0.05 0.007
Diluted (0.02) (0.002) 0.05 0.007
Weighted average
number of
ordinary
shares
outstanding:
Basic 80,000,000 80,000,000 80,000,000 80,000,000
Diluted 80,000,000 80,000,000 80,000,000 80,000,000
Net income/
(loss) per
ADS
Basic (0.05) (0.007) 0.16 0.020
Diluted (0.05) (0.007) 0.16 0.020
Weighted average
number of
ADS outstanding:
Basic 26,666,667 26,666,667 26,666,667 26,666,667
Diluted 26,666,667 26,666,667 26,666,667 26,666,667
JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
Quarter Ended
-------------------------
December 31, 2006
RMB USD
(unaudited)
-------------------------
Revenue from
third parties 309,618,090 39,673,773
Revenue from
related
parties 39,785,881 5,098,074
------------ -----------
Total revenues 349,403,971 44,771,847
Cost of
revenues (265,733,652) (34,050,519)
------------ -----------
Gross profit 83,670,319 10,721,328
Selling,
general and
administrative
expenses (8,886,291) (1,138,670)
Research and
development
expenses (645,732) (82,743)
------------ -----------
Total
operating
expenses (9,532,023) (1,221,412)
------------ -----------
Income/
(loss)
from
operations 74,138,296 9,499,916
------------ -----------
Interest
expense (2,219,396) (284,388)
Interest
income 398,977 51,124
Other income 64,414 8,254
Foreign
exchange
gain/ (loss) 1,043,758 133,745
------------ -----------
Income/
(loss)
before
income
taxes 73,426,049 9,408,650
Income tax
benefit/
(expense) -- --
------------ -----------
Net income/
(loss) 73,426,049 9,408,650
------------ -----------
Preferred
shares
accretion (1,113,799) (142,720)
Preferred
shares
beneficial
conversion
charge -- --
Allocation of
income to
participating
preferred
shareholders (5,449,328) (698,265)
------------ -----------
Net income
available to
ordinary 66,862,922 8,567,666
shareholders ============ ===========
Net income/
(loss) per
ordinary
shares
Basic 0.84 0.107
Diluted 0.82 0.105
Weighted average
number of
ordinary
shares
outstanding:
Basic 80,000,000 80,000,000
Diluted 89,803,092 89,803,092
Net income/
(loss) per ADS
Basic 2.51 0.321
Diluted 2.45 0.314
Weighted average
number of ADS
outstanding:
Basic 26,666,667 26,666,667
Diluted 29,934,364 29,934,364
Each ADS represents 3 ordinary shares
JA Solar Holdings Co., Ltd.
Condensed Consolidated Statements of Operations
Year ended
----------------------------------------------------
December 31, 2005 December 31, 2006
RMB USD RMB USD
----------------------------------------------------
(audited) (unaudited) (unaudited) (unaudited)
----------------------------------------------------
Revenue from
third parties -- -- 565,327,330 72,439,785
Revenue from
related parties -- -- 131,130,774 16,802,805
------------ ------------ ------------ ------------
Total revenues -- -- 696,458,104 89,242,591
Cost of revenues -- -- (524,163,013) (67,165,082)
------------ ------------ ------------ ------------
Gross profit -- -- 172,295,091 22,077,509
Selling,
general and
administrative
expenses (2,638,340) (338,071) (39,656,083) (5,081,442)
Research and
development
expenses (383,468) (49,137) (1,357,610) (173,961)
------------ ------------ ------------ ------------
Total operating
expenses (3,021,808) (387,208) (41,013,693) (5,255,403)
------------ ------------ ------------ ------------
Income/ (loss)
from
operations (3,021,808) (387,208) 131,281,398 16,822,106
------------ ------------ ------------ ------------
Interest
expense -- -- (5,055,382) (647,785)
Interest
income 38,965 4,993 823,995 105,585
Other income
(expense) -- -- 64,414 8,254
Foreign
exchange gain/
(loss) (128,152) (16,421) 1,300,008 166,580
------------ ------------ ------------ ------------
Income/ (loss)
before income
taxes (3,110,995) (398,636) 128,414,433 16,454,740
Income tax
benefit/
(expense) -- -- -- --
Net income/
(loss) (3,110,995) (398,636) 128,414,433 16,454,740
------------ ------------ ------------ ------------
Preferred
shares
accretion -- -- (1,603,399) (205,456)
Preferred
shares
beneficial
conversion
charge -- -- (34,732,133) (4,450,498)
Allocation of
net income to
participating
preferred
shareholders -- -- (5,682,574) (728,152)
------------ ------------ ------------ ------------
Net income
available to
ordinary
shareholders (3,110,995) (398,636) 86,396,327 11,070,633
============ ============ ============ ============
Net income/
(loss) per
ordinary
shares:
Basic (0.04) (0.005) 1.08 0.138
Diluted (0.04) (0.005) 1.08 0.138
Weighted
average number
of ordinary
shares
outstanding:
Basic 80,000,000 80,000,000 80,000,000 80,000,000
Diluted 80,000,000 80,000,000 80,166,178 80,166,178
Net income/
(loss) per ADS:
Basic (0.12) (0.015) 3.24 0.415
Diluted (0.12) (0.015) 3.23 0.414
Weighted
average number
of ADS
outstanding:
Basic 26,666,667 26,666,667 26,666,667 26,666,667
Diluted 26,666,667 26,666,667 26,722,059 26,722,059
Each ADS represents 3 ordinary shares
JA Solar Holdings Co., Ltd.
Condensed Consolidated Balance Sheets
December 31, 2005 December 31, 2006
RMB USD RMB USD
--------------------------------------------------
(audited) (unaudited) (unaudited) (unaudited)
--------------------------------------------------
ASSETS
Current assets:
Cash and cash
equivalents 10,970,605 1,405,749 95,758,377 12,270,265
Accounts
receivable from
third party
customers -- -- 47,719,752 6,114,703
Inventories -- -- 154,675,325 19,819,752
Advances to
related party
supplier -- -- 39,831,642 5,103,938
Other current
assets 455,088 58,314 8,282,741 1,061,332
----------- ----------- ----------- -----------
Total current
assets 11,425,693 1,464,063 346,267,837 44,369,990
Property and
equipment, net 39,392,413 5,047,656 139,399,605 17,862,355
Intangible asset,
net 8,250,000 1,057,137 7,224,713 925,759
----------- ----------- ----------- -----------
Total assets 59,068,106 7,568,856 492,892,155 63,158,103
=========== =========== =========== ===========
LIABILITIES AND
SHAREHOLDERS'
EQUITY
Current
liabilities:
Short-term bank
borrowings -- -- 150,000,000 19,220,666
Accounts payable -- -- 2,501,790 320,574
Value-added tax
payable -- -- 3,639,665 466,379
Other payables 1,578,687 202,289 2,769,566 354,886
Payroll and
welfare payable 113,500 14,544 2,676,854 343,006
Accrued expenses 29,514 3,782 3,932,709 503,929
Amounts due to
related parties 757,845 97,109 254,423 32,601
Advance from
third party
customers -- -- 21,329,609 2,733,129
----------- ----------- ----------- -----------
Total current
liabilities 2,479,546 317,724 187,104,616 23,975,169
----------- ----------- ----------- -----------
Total liabilities 2,479,546 317,724 187,104,616 23,975,169
----------- ----------- ----------- -----------
Preferred shares
(US$0.0001 par
value; 0 and
6,520,000 shares
outstanding as
of December 31,
2005 and 2006) -- -- 110,037,714 14,099,988
----------- ----------- ----------- -----------
Shareholders'
equity:
Ordinary shares
(US$0.0001 par
value;
493,480,000
shares authorized,
80,000,000 shares
issued and
outstanding as of
December 31, 2005
and December 31,
2006) 66,212 8,484 66,212 8,484
Additional
paid-in capital 59,633,343 7,641,284 106,715,707 13,674,313
Statutory reserves -- -- 14,587,748 1,869,242
Retained earnings/
(accumulated
deficit) (3,110,995) (398,636) 74,380,158 9,530,908
----------- ----------- ----------- -----------
Total
shareholders'
equity 56,588,560 7,251,132 195,749,825 25,082,947
----------- ----------- ----------- -----------
Total
liabilities and
shareholders'
equity 59,068,106 7,568,856 492,892,155 63,158,103
=========== =========== =========== ===========
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