JinkoSolar(US:JKS)2022-04-28 16:04Financial Data and Key Metrics Changes - Total revenues for Q1 2022 were RMB 14.8 billion, an increase of 86% year-over-year, with quarterly shipments up by 57% year-over-year to 8.4 gigawatts [6][19] - Gross profit increased by more than 60% year-over-year, but gross margin decreased to 15.1% from 17.1% year-over-year [6][20] - Net income attributable to ordinary shareholders was $4.6 million, resulting in diluted earnings per ADS of $0.01 [21] Business Line Data and Key Metrics Changes - The company achieved a significant milestone with accumulated global module shipments surpassing 100 gigawatts [14] - Module shipments in Europe increased by more than 30% quarter-over-quarter, while shipments in China nearly tripled year-over-year [14][15] - The proportion of Tiger Pro 182-millimeter large-sized products exceeded 80% in Q4 and is expected to exceed 90% for the entire year [17] Market Data and Key Metrics Changes - Demand for solar energy in Europe has been boosted by the Russia-Ukraine war, with expectations for steady growth [8][14] - The company anticipates total global installations to reach about 250 gigawatts in 2022 [8] - The proportion of distributed generation in shipments is expected to be in the range of 35% to 40% this year, with steady growth anticipated [16] Company Strategy and Development Direction - The company plans to invest in the second phase of N-type cells with a total production capacity of approximately 16 gigawatts [12] - A focus on enhancing deployment in the domestic market for distributed generation in China is underway [11] - The company aims to coordinate market strategy, pricing systems, and brand development to gain technical advantages in the distributed generation sector [12] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the resilience of the PV industry despite macroeconomic uncertainties and supply chain disruptions [9] - The company believes the impact of the pandemic on production and operations is temporary and under control [9] - Management reiterated guidance on total shipments for the full year of 2022, expecting shipments in Q2 to be in the range of 8.5 to 9.5 gigawatts [13] Other Important Information - The company had cash and cash equivalents of $2.66 billion at the end of Q1 2022, significantly up from $1 billion a year earlier [22] - Total debt was $4.33 billion at the end of Q1 2022, compared to about $4 billion at the end of Q4 2021 [23] - The expected CapEx for 2022 is $3 billion, reflecting increased capacity outlook [66] Q&A Session Summary Question: Differences in profit levels between Asia subsidiary and US level - Management explained that the differences arise from the holding company's share of the subsidiaries and the impact of convertible bonds [26][28] Question: Contribution of polysilicon investment to profits - Management indicated that no material contribution is expected from polysilicon investments due to minority equity holdings [30] Question: Increased capacity guidance and shipment materialization - Management confirmed that new capacity of 16 gigawatts is ramping up, with expectations to ship over 10 gigawatts segments for the full year [32] Question: Impact of antidumping investigations in the US - Management acknowledged that the investigations are causing uncertainty in the industry, but the company has established a vertically integrated supply chain to mitigate risks [35][36] Question: Structure of contracts regarding potential retroactive tariffs - Management stated that different customers have different risk appetites and solutions regarding potential tariffs [38] Question: Margin outlook for Q2 - Management expects gross profit margin to be stable compared to Q1 [46] Question: Plans for dividends and potential buybacks - Management has not made a decision on how to utilize the expected dividends, considering options for buybacks or reinvestment [50] Question: Module pricing trends for the rest of the year - Management indicated that module prices are stabilizing, with strong demand expected to continue [52] Question: CapEx forecast for 2022 - Management confirmed the expected CapEx for the year is $3 billion, reflecting increased capacity plans [66]