Ldk Solar Co (NYSE:LDK)

Fourth Quarter 2011 Results

• Net sales for the fourth quarter of fiscal 2011 were $420.2 million, compared to $471.9 million for the third quarter of fiscal 2011, and $920.9 million for the fourth quarter of fiscal 2010.
• Net loss attributable to LDK Solar's shareholders for the fourth quarter of fiscal 2011 was $588.7 million, or a loss of $4.63 per diluted ADS, compared to a net loss of $114.5 million, or a loss of $0.87 per diluted ADS for the third quarter of fiscal 2011 and net income of $145.2 million, or $1.09 per diluted ADS for the fourth quarter of fiscal 2010

During the preparation of its fourth quarter 2011 financial results, LDK Solar's management determined that an inventory write-down and provision for firm purchase commitment of $232.6 million was required as a result of the significant drop in market price for polysilicon, wafers and modules during the fourth quarter. As a result, gross margin and results from operations were negatively impacted in the fourth quarter of fiscal 2011.

"The solar industry experienced a tremendous supply and demand imbalance throughout the value chain during the fourth quarter. Our results reflected the negative effects of this dislocation in the PV market," stated Xiaofeng Peng, Chairman and CEO of LDK Solar. "Weak market demand and rapidly declining average selling prices reduced our revenue and adversely impacted our margins in the quarter.

"In 2012, we expect that excess capacity and further policy uncertainties in Europe and the U.S. will result in continued intense competition within the solar industry. As such, we remain focused on improving our cost structure by driving down production costs and closely managing our operating expenses. PV applications are increasing globally with improved affordability for solar electricity. We continue to believe that the considerable opportunities to meet global energy needs with solar power will drive long-term market growth," concluded Mr. Peng.

Business Outlook

The following statements are based upon management's current expectations. These statements are forward-looking in nature, and the actual results may differ materially. You should read the "Safe Harbor Statement" below with respect to the risks and uncertainties relating to these forward-looking statements.

For the first quarter of fiscal 2012, LDK Solar estimates its revenue to be in the range of $190 million to $230 million, wafer shipments between 140 MW and 150 MW, cells and module shipments between 170 MW and 180 MW, in-house polysilicon production between 1,800 MT and 1,900 MT and in-house cell production between 40 MW and 50 MW.

For fiscal 2012, LDK Solar estimates its revenue to be in the range of $2.0 billion to $2.7 billion, polysilicon production between 12,000 MT and 15,000 MT, of which shipments to 3rd party customers are expected to be between 6,000 MT and 8,000 MT, wafer production between 2.7 gigawatts (GW) and 3.3 GW, of which shipments to 3rd party customers are expected to be between 1.5 GW and 2.0 GW, in-house cell production between 1.2 GW and 1.6 GW, and module production between 1.2 GW and 1.6 GW, with cell and module shipments to 3rd party customers between 1.0 GW and 1.3 GW and inverter shipments between 200 MW to 250 MW. LDK Solar expects PV system project construction to be in the range of 400 MW to 600 MW and to recognize between 270 MW and 360 MW through project sales and EPC services for 3rd party customers.

Guidance

For the fourth quarter of 2011, LDK Solar revised its guidance for revenue to be in the range of $440 to $450 million, wafer shipments between 215 and 220 megawatts (MW), cells and module shipments between 250 MW and 260 MW, in-house polysilicon production between 2,100 MT and 2,300 MT and in-house cell production between 130 MW and 150 MW.

The Company previously forecasted fourth quarter revenue to be in the range of $440 million to $520 million with wafer shipments between 200 MW and 270 MW, and module shipments between 180 MW and 270 MW, in-house polysilicon production between 2,200 MT and 2,800 MT, in-house cell production between 220 MW and 250 MW.

As a result of the rapidly declining market price for wafers and modules during the fourth quarter of 2011, LDK Solar expects to incur a write-down of inventories, realize impairment charges on contractual purchase agreements, and therefore, expects gross margin to be negative. In addition, some provisions for accounts receivable and fixed assets may also be required.

For fiscal 2012, LDK Solar estimates its revenue in the range of $2.0 billion to $2.7 billion, polysilicon production between 12,000 MT and 15,000 MT, of which shipments to 3rd party customers are expected to be between 6,000 MT and 8,000 MT, wafer production between 2.7 gigawatts (GW) and 3.3 GW, of which shipments to 3rd party customers are expected to be between 1.5 GW and 2.0 GW, in-house cell production between 1.2 GW and 1.6 GW, and module production between 1.2 GW and 1.6 GW, with cell and module shipments to 3rd party customers between 1.0 GW and 1.3 GW, inverter shipments between 200 MW to 250 MW. LDK Solar expects PV system project construction to be in the range of 400 MW to 600 MW and to recognize between 270 MW and 360 MW through project sales and EPC services for 3rd party customers.

Outlook for the fourth quarter 2011 and fiscal 2012 are preliminary estimates. The Company has yet to complete its preliminary review and compilation of its financial information for the quarter. Results are subject to change based on further review by management.

XINYU CITY, China, and SUNNYVALE, Calif., Jan. 3, 2012 /PRNewswire/ -- LDK Solar Co., Ltd. ("LDK Solar"; NYSE: LDK) today announced that it, through its wholly owned subsidiary, LDK Solar Germany Holding GmbH, has entered into an investment agreement, dated December 31, 2011, with Sunways AG, a German stock corporation with its shares listed on the Frankfurt Stock Exchange, to acquire approximately 33% of Sunways' increased share capital following a capital increase from its authorized capital. 

In the capital increase, LDK Solar will subscribe for a total of 5.79 million new shares of Sunways to be issued against a cash contribution and contributions in kind. The issue amount of the shares to be granted against the cash contribution amounts to a total of euro 2,201,805.50. Simultaneously, LDK Solar has announced its intention to submit to the Sunways shareholders a public takeover offer for all outstanding shares in the company. Subject to the approval of the offer's publication by the Federal Financial Supervisory Authority (Bundesanstalt fur Finanzdienstleistungsaufsicht – BaFin), the takeover offer is expected to be published in late January 2012. Under this offer, a cash consideration of euro 1.90 per share is to be offered to the Sunways shareholders. Both the capital increase as well as the completion of the takeover offer must be formally cleared by the Federal Cartel Office (Bundeskartellamt). Following the clearance under the cartel law, the completion of the offer is currently expected to occur in the first quarter of 2012.

Second Quarter 2011 Results

• 
  Net sales for the second quarter of fiscal 2011 were $499.4 million, compared to $766.3 million for the first quarter of fiscal 2011, and $565.3 million for the second quarter of fiscal 2010.
• Gross profit for the second quarter of fiscal 2011, was $11.0 million, compared to $241.6 million in the first quarter of fiscal 2011, and $101.8 million for the second quarter of fiscal 2010.
• Net loss attributable to LDK Solar's shareholders for the second quarter of fiscal 2011 was $87.7 million, or a loss of $0.62 per diluted ADS, compared to net income of $135.4 million, or $0.95 per diluted ADS for the first quarter of fiscal 2011 and $45.0 million, or $0.36 per diluted ADS for the second quarter of fiscal 2010. The number of shares for calculating diluted ADS was approximately 140.7 million for the second quarter of fiscal 2011.

LDK Solar ended the second quarter of fiscal 2011 with $636.4 million in cash and cash equivalents and $515.3 million in short-term pledged bank deposits.

"Our second quarter results reflect the challenging solar industry dynamics that resulted from recent policy revisions in Europe and consequently reduced demand for PV products," stated Xiaofeng Peng, Chairman and CEO of LDK Solar. "Lower pricing across the supply chain negatively impacted our financial results for the quarter.

"In recent weeks, we have seen average selling prices begin to stabilize and improvement to order patterns. We have continued to gain traction in expanding our presence in key markets such as North America and China. In the U.S., our recently established sales and marketing operation has already begun to gain traction in winning large module contracts. In China, we are encouraged by the announcement of the unified national feed-in-tariff program. We have an established, strong market position in our domestic market and see significant long-term growth opportunities.

"We are actively taking steps to improve our cost structure and strengthen our balance sheet. We continue to make progress on lowering our manufacturing costs as we gain scale in our newer PV product areas such as solar cells. Going forward, based on our current pipeline of business, we believe growth will resume in the second half of 2011," concluded Mr. Peng.

Business Outlook

The following statements are based upon management's current expectations. These statements are forward-looking in nature, and the actual results may differ materially. You should read the "Safe Harbor Statement" below with respect to the risks and uncertainties relating to these forward-looking statements.

For the third quarter of fiscal 2011, LDK Solar estimates its revenue to be in the range of $630 million to $680 million with wafer shipments between 350 MW and 400 MW, and module shipments between 250 MW and 300 MW, in-house polysilicon production between 2,600 MT and 2,700 MT, in-house cell production between 200 MW and 220 MW and gross margin between 11% and 16%.

For fiscal 2011, LDK Solar estimates its revenue to be in the range of $2.5 to $2.7 billion, wafer shipments between 1.8 gigawatts (GW) and 2.0 GW, module shipments between 750 MW and 800 MW, in-house polysilicon production between 10,000 MT and 11,000 MT, in-house cell production between 600 MW and 700 MW and gross margin between 15% and 20%.

XINYU CITY, China and SUNNYVALE, Calif., Aug. 18, 2011 /PRNewswire/ -- LDK Solar Co., Ltd. ("LDK Solar") (NYSE: LDK), a leading vertically integrated manufacturer of photovoltaic products, today revised its guidance for the second quarter of 2011 and fiscal 2011.  Additionally, the company announced that it will report financial results for the second quarter ended June 30, 2011 before the market opens on Monday, August 29, 2011.  The company will host a corresponding conference call and live webcast at 8:00 a.m. Eastern Time (ET) the same day.

For the second quarter of 2011, LDK Solar revised its guidance for revenue to be in the range of $480 to $500 million, wafer shipments between 410 and 430 megawatts (MW), module shipments between 75 MW and 80 MW, in-house polysilicon production between 2,700 MT and 2,750 MT and in-house cell production between 120 MW and 125 MW. As a result of the significant drop in market price for wafers and modules during the second quarter of 2011, LDK Solar expected to write-down $55 to $60 million of inventories and expected the gross margin for the second quarter of 2011 to be between 1.5% and 2.5%.  The Company's cash and cash-equivalent balance was approximately $630 million as of June 30, 2011.

The company previously forecasted second quarter 2011 revenue in the range of $710 million to $760 million with wafer shipments between 500 MW and 550 MW, module shipments between 200 MW and 220 MW, in-house polysilicon production between 2,650 MT and 2,750 MT, in-house cell production between 120 MW and 130 MW and gross margin between 22% and 26%.

For fiscal 2011, LDK Solar revised its guidance for revenue to be in the range of $2.5 to $2.7 billion, wafer shipments between 1.8 gigawatts (GW) and 2.0 GW, module shipments between 750 MW and 800 MW, in-house polysilicon production between 10,000 MT and 11,000 MT, in-house cell production between 600 MW and 700 MW and gross margins between 15% and 20%.  

The company previously forecasted fiscal 2011 revenue in the range of $3.5 to $3.7 billion with wafer shipments between 2.7 and 2.9 gigawatts (GW), module shipments between 800 MW and 900 MW, in-house polysilicon production between 10,000 MT and 11,000 MT, in-house cell production between 500 MW and 600 MW and gross margin between 24% and 29%.

The outlook for the three months ended June 30, 2011 and full year ending December 31, 2011 are estimates. Results are subject to change based on further review by management.

XINYU CITY, China and SUNNYVALE, Calif., June 27, 2011 /PRNewswire/ -- LDK Solar Co., Ltd. (NYSE: LDK), a leading vertically integrated manufacturer of photovoltaic products, today announced that its Board of Directors approved a share buyback program that authorizes LDK Solar to repurchase up to US$110 million of its American Depository Shares ("ADSs") in the open market or through privately negotiated transactions. The program does not obligate LDK Solar to acquire any particular amount of its ADSs and may be modified or suspended at any time at the sole discretion of LDK Solar.

Mr. Xiaofeng Peng, Chairman and CEO of LDK Solar, commented, "We remain confident in our current outlook as well as the long-term prospects for our business.  However, we believe our ADSs are currently grossly undervalued. We believe our share buyback program not only represents a good investment for our company, but also demonstrates our commitment to enhance shareholder value."

On February 1, 2011, the Company issued 13,800,000 ADSs, representing 13,800,000 ordinary shares at a price of US$12.4 per ADSs, raising approximately US$164,220, net of certain expenses. On February 28, 2011 and April 11, 2011, the Company respectively issued an aggregate principal amount of RMB 1,200,000 and RMB 500,000, 10% US$-Settled Senior Notes due 2014 (the “Senior Notes”) and received net proceeds from the offering, after deducting certain expenses, of approximately US$254,994 in total. The Company will consider obtaining additional fundings from the issuance of additional equity or debt when market conditions permit and such issuance are in the overall interests of the Group’s business.
 
Therefore, after careful consideration of the factors that initially raises substantial doubt and the liquidity plans described above, management has prepared the accompanying consolidated financial statements on the basis that the Group will be able to continue as going concern. The consolidated financial statements do not include any adjustments related to the recoverability and classification of recorded assets or the amounts and classification of liabilities or any other adjustments that might be necessary should the Group be unable to continue as a going concern.

As of December 31, 2010, we had a working capital deficit (being our total consolidated current liabilities less our total consolidated current assets) of $1,602.4 million. As of December 31, 2010, we had cash and cash equivalents of $202.1 million. The majority of our cash and cash equivalents was held by our subsidiaries in China. In addition, we had short-term borrowings and current installments of our long-term borrowings totaling $1,501.6 million as of December 31, 2010, most of which were the obligations of our subsidiaries in China. These factors initially raise substantial doubt as to our ability to continue as a going concern.

We are in need of additional funding to sustain our business as a going concern, and we have formulated a plan to address our liquidity problem. Our liquidity plan includes: 

• obtaining additional bank financing, including an additional $570.9 million of secured and unsecured short-term bank borrowings, $205.5 million of secured and unsecured long-term bank borrowings and repayments of $542.3 million of short-term borrowings and current installments of long-term borrowings, between January 1, 2011 and March 31, 2011;  
• additional capital markets transactions, including the offering of Rmb 1.7 billion in aggregate principal amount of our US$-settled 10% senior notes due 2014, or the 2014 senior notes, from which we received proceeds of approximately $255.0 million, net of underwriting commission and certain expenses; and our offering of 13,800,000 ADSs, representing 13,800,000 of our ordinary shares, in February 2011, from which we received net proceeds of approximately $164.2 million, while repurchasing an aggregate principal amount of $357.2 million of our 4.75% convertible senior notes due 2013 that we issued in April 2008, or the existing convertible senior notes;  
• reorganizing our polysilicon business to facilitate financing, including a recently contracted but not yet closed third-party investment of $240 million, in this business; and  
• strategic financing framework arrangement in September 2010 with China Development Bank Corporation, or CDB, pursuant to which CDB intends to provide up to Rmb 60 billion, or approximately $8.9 billion, of credit facilities to us over a five-year period, subject to credit reviews and certain other conditions and under terms to be agreed at each time enter into a borrowing under this arrangement. 
  

XINYU CITY, China and SUNNYVALE, Calif., Jan. 27, 2011 /PRNewswire/ -- LDK Solar Co., Ltd., today priced a follow-on offering of 12,000,000 American depositary shares, each representing one ordinary share, at a price to the public of $12.40 per ADS. In connection with the follow-on offering, LDK Solar has also granted the underwriters an over-allotment option to purchase up to an additional 1,800,000 ADSs.

• Net sales for the third quarter of fiscal 2010 were $675.6 million, compared to $565.3 million for the second quarter of fiscal 2010 and $281.9 million for the third quarter of fiscal 2009.

• Gross profit for the third quarter of fiscal 2010 was $150.0 million, compared to $101.8 million in the second quarter of fiscal 2010 and $56.8 million for the third quarter of fiscal 2009.

• Gross margin for the third quarter of fiscal 2010 was 22.2%, compared to 18.0% in the second quarter of fiscal 2010 and 20.1% in the third quarter of fiscal 2009.

• Income from operations for the third quarter of fiscal 2010 was $119.5 million, compared to $78.6 million for the second quarter of fiscal 2010 and $37.1 million for the third quarter of fiscal 2009.

• Net income for the third quarter of fiscal 2010 was $93.4 million, or $0.72 per diluted ADS, compared to $45.0 million, or $0.36 per diluted ADS for the second quarter of fiscal 2010 and $29.4 million, or $0.27 per diluted ADS for the third quarter of fiscal 2009.  

"Our results for the third quarter were strong by all measures," stated Xiaofeng Peng, Chairman and CEO of LDK Solar.  "We delivered a second consecutive quarter of record revenue as strong industry demand coupled with an improved pricing environment drove better than expected results.  

"We are benefiting from our diversification strategy as we see increasing contributions from our polysilicon, module and cell businesses.  As we gain further traction in these areas, we expect to experience enhanced top line and earnings growth.  

"During the third quarter, our expansion plans remained on track as we reached manufacturing capacity of 11,000 MT in polysilicon, 2.6 GW in wafers, 760 MW in modules and 120 MW in cells. We signed multiple supply contracts which further broaden our customer base.  Importantly, our recent financing agreement with the China Development Bank enhances our ability to pursue our long-term growth strategy.  With our strong financial position and healthy order trend, we see continued opportunity for growth."

Business Outlook

The following statements are based upon management's current expectations. These statements are forward-looking in nature, and the actual results may differ materially. You should read the "Safe Harbor Statement" below with respect to the risks and uncertainties relating to these forward-looking statements.

For the fourth quarter of fiscal 2010, LDK Solar estimates its

• Revenue to be in the range of $710 million to $750 million

• Wafer shipments between 580 MW and 600 MW

• Module shipments between 120 MW and 130 MW

• In-house polysilicon production between 1,700 MT and 1,900 MT

• In-house cell production between 20 MW and 23 MW

• Gross margin between 24% and 26%.  

For fiscal 2011, LDK Solar expects its

• Revenue to be in the range of $2.9 billion to $3.3 billion

• Wafer shipments between 2.5 GW and 2.8 GW

• Module shipments between 700 MW and 800 MW

• In-house polysilicon production between 9,000 MT and 10,000 MT

• in-house cell production between 400 MW and 500 MW

• Gross margin between 22% and 28%

LDK Solar Co., Ltd.  today provided an updated outlook for its third quarter 2010 financial results.  For the third quarter of 2010, LDK Solar expects to report revenue in the range of $610 to $640 million, wafer shipments of 550 to 570 megawatts (MW), and module shipments of 80 MW to 90 MW.  The Company's prior guidance for the third quarter was revenue of $570 to $600 million, wafer shipments of 520 to 550 MW, and module shipments of 75 to 85 MW.

At the end of September 2010, LDK Solar's manufacturing capacity reached, as previously planned, 11,000 MT in polysilicon, 2.6 gigawatts (GW) in wafers, 120 MW in cells, and 760 MW in modules.  As of the end of the third quarter, cash balances, including pledged bank deposits, were approximately $800 million.

This outlook for the three months ended September 30, 2010 is an estimate.  Results are subject to change based on further review by management.  Once the third quarter reporting date is finalized, LDK Solar will issue a press release announcing the date and details of its third quarter conference call.

We, LDK Solar Co., Ltd., a leading manufacturer of multicrystalline solar wafers, has provided an updated outlook for our second quarter 2009 financial results.

For the second quarter of 2009, we expect to report between $225 million and $235 million in revenue, slightly above the recently announced estimated range, and wafer shipments between 230 and 240 megawatts (“MW”). We expect to record a write-down of $150 to $160 million against the cost of inventories for a decline in net realizable value of inventories resulting from the continued market price decline for solar wafers. As a result, the gross margin is expected to be negative and we expect to report a net loss of $180 to $200 million in the second quarter.

Source: PR Newswire (July 23, 2009)

Guidance Update:

"As expected, the first quarter of 2009 was characterized by a continued challenging operating environment for economies and industries globally, not precluding the solar industry,' stated Xiaofeng Peng, Chairman and CEO of LDK Solar. 'During the quarter, we remained focused on positioning the company for future growth, while aligning our operations and near-term strategies to be more reflective of the current business conditions."

For the second quarter of fiscal 2009, LDK Solar estimates its wafer shipments between 200 MW to 220 MW.

The company did not comment on its previously issued 2009 revenue guidance.

Source: PR Newswire (May 21, 2009)

Guidance Report:

'We enter 2009 with conservative optimism. In light of the continued economic slowdown and global credit crisis, we recently amended our expansion plans to lower capital expenditure needs in the near term and to better reflect muted market expectations for 2009. As the credit markets continue to contract, we believe that conservative cash management is imperative and will focus on closely monitoring capital spending to protect our healthy cash position and unused credit facilities, which were $850 million at the end of 2008. While the business environment has been challenging, we believe we are uniquely positioned within the solar industry and going forward will benefit from our lean cost structure and economies of scale. As we brace for continued challenges in the current marketplace, we remain confident in the core strengths of our business model and long-term growth strategies,' concluded Mr. Peng.

Full Year Fiscal 2009 Guidance Ending December

Source: PR Newswire (March 11, 2009)