North Coast Solar Stocks

December 19, 2007

LDK Solar Reports Financial Results for the Third Quarter 2007

Filed under: LDK — Tags: , , , — Jason @ 8:00 am

Xinyu City, China and Sunnyvale, California, December 19, 2007 – LDK Solar Co., Ltd. (NYSE:LDK), a leading manufacturer of multicrystalline solar wafers, today reported its unaudited financial results for the third quarter ended September 30, 2007.

All financial results are reported on a U.S. GAAP basis.

Third Quarter 2007 Financial Highlights:

* Revenue of $158.7 million, up 60% quarter-over-quarter
* Gross profit of $48.9 million, up 40% quarter-over-quarter
* Net income of $41.6 million, or $0.37 per diluted ADS, up 45% quarter-over-quarter
* Signed four long-term wafer supply agreements during the third quarter
* Total wafer shipments increased 49% sequentially to 78.9MW in the third quarter

Net sales for the third quarter of fiscal 2007 were $158.7 million, up 60.2% sequentially from $99.1 million for the second quarter of fiscal 2007, and up 404.7% year-over-year from $31.5 million for the third quarter of fiscal 2006.

Gross profit for the third quarter of fiscal 2007 was $48.9 million, up 40.2% sequentially from $34.9 million for the second quarter of fiscal 2007, and up 295.1% year-over-year from $12.4 million for the third quarter of fiscal 2006.Gross margin for the third quarter of fiscal 2007 was 30.8% compared with 35.2% in the second quarter of fiscal 2007 and 39.4% in the third quarter of fiscal 2006.

Net income for the third quarter of fiscal 2007 was $41.6 million, or $0.37 per diluted ADS, compared to net income of $28.7 million, or $0.29 per diluted ADS for the second quarter of fiscal 2007, and $5.0 million, or $0.04 per diluted ADS for the third quarter of fiscal 2006.

The Company ended the third quarter of fiscal 2007 with $125.9 million in cash and cash equivalents.

“We are pleased to report strong results for the third quarter, following a positive outcome of the independent inventory review,” stated Xiaofeng Peng, Chairman and CEO of LDK Solar.“With the inventory investigation behind us, we have returned our focus to growing our business.During the third quarter we experienced continued robust demand for our wafers and made great strides in expanding our customer base.We signed four long-term wafer supply contracts during the third quarter and five more since the quarter closed. We view these agreements as a testament to the quality of our products.

“We remain on track to meet our wafer production capacity goal of 400MW by the end of 2007. Additionally, the construction of our polysilicon plant is tracking with our original plan.In addition to the anticipated cost efficiencies we expect to achieve upon completion of our polysilicon plant, we are continuing cost reduction efforts through further advancements of our product processes,” concluded Mr. Peng.

Business Outlook

The following statements are based upon management’s current expectations. These statements are forward-looking, and actual results may differ materially. The Company undertakes no obligation to update these statements.

For the fourth quarter of fiscal 2007, LDK estimates revenue to be in the range of $180 to $185 million for wafer shipments of 87 to 92MW.The Company also estimates fully diluted earnings per ADS to be in the range of $0.40 to $0.43.

Conference Call Details

The LDK Third Quarter teleconference and webcast is scheduled to begin at 6:00 p.m. Eastern Time (ET), on Wednesday, December 19, 2007. To listen to the live conference call, please dial 800-366-7449 (within U.S.) or 303-262-2193 (outside U.S.) at 5:50 p.m. ET on December 19, 2007. An audio replay of the call will be available to investors through December 24, 2007, by dialing 800-405-2236 (within U.S.) or 303-590-3000 (outside U.S.) and entering the passcode 11104747##
.
A live webcast of the call will be available on the company’s investor relations website at investor.ldksolar.com.

LDK Solar Co., Ltd.

Unaudited Condensed Consolidated Balance Sheet Information

(In US$’000, except share and per share data)

9/30/2007

6/30/2007

Assets

Current assets

Cash and cash equivalents

125,858

250,600

Pledged bank deposits

106,840

2,722

Trade accounts receivable, net

8,666

7,825

Inventories

224,527

173,778

Prepayments to suppliers

183,467

129,902

Deferred expenses

236

281

Other current assets

9,325

6,281

Total current assets

658,919

571,389

Property, plant and equipment, net

224,477

169,330

Deposit for purchase of equipment

136,870

40,840

Intangible asset, net

1,098

1,117

Land use rights

29,152

8,060

Deferred income tax assets

757

151

Long-term prepayments to suppliers

10,626

Total assets

1,061,899

790,887

Liabilities and shareholders’ equity

Current liabilities

Short-term bank borrowings

186,559

80,036

Trade accounts payable

23,044

9,525

Advance payments from customers

154,931

72,232

Accrued expenses and other payables

42,278

33,592

Total current liabilities

406,812

195,385

Deferred revenue

2,280

Long-term bank borrowings, excluding current portions

29,967

29,890

Total liabilities

439,059

225,275

Shareholders’ equity

Ordinary shares: US$0.10 par value; 134,000,000 shares authorized; 104,587,700 and 106,044,700 shares issued and outstanding as of June 30, 2007 and September 30, 2007, respectively

10,604

10,458

Additional paid-in capital

482,419

473,696

Statutory reserve

3,623

3,623

Accumulated other comprehensive income

14,259

?7,505

Retained earnings

111,935

70,330

Total shareholders’ equity

622,840

565,612

Total liabilities and shareholders’ equity

1,061,899

790,887


LDK Solar Co., Ltd.

Unaudited Condensed Consolidated Income Statement Information

(In US$’000, except per ADS data)

For the 3 Months Ended

9/30/2007

6/30/2007

9/30/2006

Net sales

158,724

99,053

31,450

Cost of goods sold

(109,807)

(64,153)

(19,069)

Gross profit

48,917

34,900

12,381

Selling expenses

(348)

(132)

(117)

General and administrative expenses

(4,459)

(3,579)

(1,633)

Research and development expenses

(921)

(367)

(76)

Total operating expenses

(5,728)

(4,078)

(1,826)

Income from operations

43,189

30,822

10,555

Other income/(expenses):

Interest income

1,846

271

26

Interest expense and amortization of discount on exchangeable notes

(2,650)

(2,180)

(4,961)

Decrease in fair value of warrants

2

9

Foreign currency exchange loss, net

(2,041)

(576)

(667)

Government subsidy

662

406

Income before income tax

41,006

28,745

4,962

Income tax benefit

599

Net Income

41,605

28,745

4,962

Accretion of Series A preferred shares to redemption value

(348)

(262)

Accretion of Series B preferred shares to redemption value

(1,101)

(267)

Accretion of Series C preferred shares to redemption value

(546)

Deemed dividend to series A preferred shareholders

(1,568)

Net income available to ordinary shareholders

41,605

26,750

2,865

Net income per ADS, Diluted

$0.37

$0.29

$0.04

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