First Solar, Inc. Announces Fourth Quarter and Full Year 2014 Financial Results
First Solar, Inc. (Nasdaq: FSLR) today announced financial results for the fourth quarter and year ended December 31, 2014. Net sales were $1,008 million in the quarter, an increase of $119 million from the third quarter of 2014. The sequential increase in net sales resulted from the sale of the Solar Gen 2 project, initial revenue recognition on the Silver State South project and other projects under construction. Revenue recognition from the Desert Sunlight and Topaz projects were lower as the projects reached completion.
The Company reported a fourth quarter GAAP earnings per fully diluted share of $1.89, compared to earnings of $0.87 in the prior quarter. The increase in net income compared to the prior quarter was due to higher profit from the sale of the Solar Gen 2 project and project cost improvements.
Cash and marketable securities at the end of the fourth quarter were approximately $2.0 billion, an increase of approximately $876 million compared to the prior quarter. Cash flows from operations were $928 million in the fourth quarter. The increase in cash and marketable securities during the quarter was due to the sale of the Solar Gen 2 project and the collection of retention payments on the Topaz and Desert Sunlight projects.
“We closed 2014 with strong execution across all fronts,” said Jim Hughes, CEO of First Solar. “We have exceeded the earnings per share, operating cash flow and bookings targets that we set at our 2014 Analyst Day. In addition we have announced another new record cell efficiency. With our strong bookings we are well positioned as we enter 2015 and remain focused on executing to our strategy.”
Additionally, the Company announced yesterday that it is in advanced negotiations to form a joint YieldCo vehicle with SunPower Corp. into which each company expects to contribute a portfolio of selected solar generation assets from their existing portfolio of assets. Additional details about the joint venture will be provided when they become available.
The Company also provided guidance for the first quarter of 2015 as follows:
- Net Sales of $550 to $650 million
- Loss of ($0.25) to ($0.35) per fully diluted share
- Cash used in operating activities of ($400) to ($500) million
Financial guidance for revenue, earnings, and operating cash flow for the first quarter is lower relative to results in prior periods primarily due to the completion of the Desert Sunlight and Topaz projects and the retention of projects on balance sheet in relation to the announced plan to pursue a joint YieldCo vehicle with SunPower. This is also expected to weigh on financial results in future quarters over the near-term. However, the Company believes this strategy will generate significant value for shareholders over the long-term.
First Solar has scheduled a conference call for today, February 24, 2015 at 4:30 p.m. ET to discuss this announcement. A live webcast of this conference call is available at http://investor.firstsolar.com/events.cfm.
An audio replay of the conference call will also be available approximately two hours after the conclusion of the call. The audio replay will remain available until Monday, March 2, 2015 at 7:30 p.m. ET and can be accessed by dialing 888-203-1112 if you are calling from within the United States or 719-457-0820 if you are calling from outside the United States and entering the replay pass code 7310252. A replay of the webcast will be available on the Investors section of the Company’s website approximately two hours after the conclusion of the call and remain available for approximately 90 calendar days.
About First Solar, Inc.
First Solar is a leading global provider of comprehensive photovoltaic (PV) solar systems which use its advanced module and system technology. The company’s integrated power plant solutions deliver an economically attractive alternative to fossil-fuel electricity generation today. From raw material sourcing through end-of-life module recycling, First Solar’s renewable energy systems protect and enhance the environment. For more information about First Solar, 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. These forward-looking statements include statements, among other things, concerning: our business strategy, including anticipated trends and developments in and management plans for our business and the markets in which we operate; future financial results, operating results, revenues, gross margin, operating expenses, products, projected costs, warranties, solar module efficiency and balance of systems (BoS) cost reduction roadmaps, restructuring, product reliability and capital expenditures; our ability to continue to reduce the cost per watt of our solar modules; our ability to reduce the costs to construct photovoltaic (PV) solar power systems; research and development programs and our ability to improve the conversion efficiency of our solar modules; sales and marketing initiatives; and competition. These forward-looking statements are often characterized by the use of words such as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “believe,” “forecast,” “foresee,” “likely,” “may,” “should,” “goal,” “target,” “might,” “will,” “could,” “predict,” “continue” 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. 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. 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 these statements. These factors include, but are not limited to, the matters discussed in Item 1A: “Risk Factors,” of our most recent Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and other reports filed with the SEC.
FIRST SOLAR, INC. AND SUBSIDIARIES
|Cash and cash equivalents||$||1,482,054||$||1,325,072|
|Accounts receivable trade, net||135,434||136,383|
|Accounts receivable, unbilled and retainage||76,971||521,323|
|Balance of systems parts||125,083||133,731|
|Deferred project costs||29,354||556,957|
|Deferred tax assets, net||91,565||63,899|
|Assets held for sale||20,728||132,626|
|Notes receivable, affiliate||12,487||–|
|Prepaid expenses and other current assets||202,670||94,720|
|Total current assets||3,190,466||3,792,764|
|Property, plant and equipment, net||1,402,304||1,385,084|
|PV solar power systems, net||46,393||–|
|Project assets and deferred project costs||810,348||720,916|
|Deferred tax assets, net||222,326||296,603|
|Restricted cash and investments||407,053||279,441|
|Investments in unconsolidated affiliates and joint ventures||255,029||17,321|
|Other intangibles, net||119,236||117,416|
|Note receivable, affiliate||9,127||–|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Income taxes payable||1,727||6,707|
|Current portion of long-term debt||51,918||60,543|
|Billings in excess of costs and estimated earnings||195,346||117,766|
|Payments and billings for deferred project costs||60,591||642,214|
|Other current liabilities||88,702||179,421|
|Total current liabilities||1,001,096||1,588,061|
|Accrued solar module collection and recycling liability||246,307||225,163|
|Commitments and Contingencies|
Common stock, $0.001 par value per share; 500,000,000 shares authorized; 100,288,942 and 99,506,941
|Additional paid-in capital||2,697,558||2,646,022|
|Accumulated other comprehensive income (loss)||50,140||(25,776||)|
|Total stockholders’ equity||5,027,487||4,503,117|
|Total liabilities and stockholders’ equity||$||6,724,439||$||6,883,502|
FIRST SOLAR, INC. AND SUBSIDIARIES
Three Months Ended
|Cost of sales||699,611||579,141||2,564,709||2,446,235|
|Research and development||34,944||38,421||143,969||134,300|
|Selling, general and administrative||70,968||65,661||253,827||270,261|
|Restructuring and asset impairments||–||24,892||–||86,896|
|Total operating expenses||109,161||128,974||402,942||494,225|
|Foreign currency loss, net||(2,628||)||(104||)||(3,017||)||(259||)|
|Interest income, net||4,326||4,219||16,048||14,868|
|Other income (expense), net||5,213||(1,945||)||(5,203||)||(4,758||)|
|Income before taxes and equity in earnings of unconsolidated affiliates||206,132||62,492||431,991||378,380|
|Income tax (expense) benefit||(10,545||)||2,982||(30,124||)||(25,179||)|
|Equity in earnings of unconsolidated affiliates, net of tax||(3,628||)||(214||)||(4,949||)||(163||)|
|Net income per share:|
|Weighted-average number of shares used in per share calculations:|
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