JA Solar Holdings (JASO) Tops Q2 EPS by 39c, Revs Beat; Remains Cautious on Outlook for 2nd-Half

JA Solar Holdings (NASDAQ: JASO) reported Q2 EPS of $0.42, $0.39 better than the analyst estimate of $0.03. Revenue for the quarter came in at $878.1 million versus the consensus estimate of $602.53 million.

• Total shipments were 2,389.2 megawatts (“MW”), consisting of 2,147.5 MW of modules and 167.2 MW of cells to external customers, and 74.5 MW of modules to the Company’s downstream projects. External shipments were up 88.3% y/y and 68.3% sequentially
• Shipments of modules were 2,147.5 MW, an increase of 89.3% y/y and 62.1% sequentially
• Shipments of cells were 167.2 MW, an increase of 75.8% y/y and 233.1% sequentially
• Net revenue was RMB 6.0 billion ($878.1 million), an increase of 44.7% y/y and 61.2% sequentially
• Gross margin was 12.9%, a decrease of 240 basis points y/y and an increase of 120 basis points sequentially
• Operating profit was RMB 255.1 million ($37.6 million), compared to RMB 188.0 million ($27.7 million) in the second quarter of 2016, and RMB 80.0 million ($11.8 million) in the first quarter of 2017
• Net income was RMB 134.6 million ($19.9 million), compared to RMB 164.1 million ($24.2 million) in the second quarter of 2016, and RMB 8.1 million ($1.2 million) in the first quarter of 2017
• Earnings per diluted ADS were RMB 2.87 or $0.42, compared to RMB 2.87 or $0.42 in the second quarter of 2016, and RMB 0.17 or $0.03 in the first quarter of 2017
• Cash and cash equivalents were RMB 3.2 billion ($477.0 million), an increase of RMB 947.6 million ($139.8 million) during the quarter
• Non-GAAP earnings1 per diluted ADS were RMB 2.87 or $0.42, compared to RMB 2.04 or $0.30 in the second quarter of 2016, and RMB 0.17 or $0.03 in the first quarter of 2017

Mr. Baofang Jin, Chairman and CEO of JA Solar, commented, "Second quarter results exceeded our expectations. Robust shipments in China, primarily attributable to accelerated activity ahead of subsidy reductions, drove our year-over-year double-digit revenue growth in the quarter. Additionally, better-than-expected average selling price and lower blended costs resulted in 120 basis-point sequential improvement in gross margin."

Mr. Jin continued, "We remain cautious on our business outlook as we enter the second half of 2017, given the slowdown in demand in our domestic market, coupled with the uncertainty around the Section 201 trade case in the U.S. While anticipated changes in incentives is expected to slow the Chinese market in the second half of the year, we continue to believe our balanced global footprint and flexible business model will enable us to adjust to evolving market conditions. Our team remains focused on prudently managing our working capital, strengthening our balance sheet and executing our business strategy to provide our customers with high-quality products.”

For earnings history and earnings-related data on JA Solar Holdings (JASO) click here.

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