EX-99.1 2 tm1923365d1_ex99-1.htm EXHIBIT 99.1

 

Exhibit 99.1

 

JinkoSolar Announces Third Quarter 2019 Financial Results

 

SHANGHAI, China, November 19, 2019 -- JinkoSolar Holding Co., Ltd. ("JinkoSolar" or the "Company") (NYSE: JKS), one of the largest and most innovative solar module manufacturers in the world, today announced its unaudited financial results for the third quarter ended September 30, 2019.

 

Strategic Business Updates

 

•Technology transformation largely complete, expected to reach 18GW mono wafer capacity by the second quarter of 2020.
•Mono based high efficiency products expected to account for close to 100% of solar module shipments in 2020.
•Record high gross profit and income from operations in the third quarter of 2019, despite push-out of China demand.
•Gross margin reset driven by increasing shift towards upgraded mono capacity, industry leading integrated production cost, new premium products and global footprint.
•Signed agreements to sell two solar power plants in Mexico with a combined capacity of 155MW. The final closing of the transaction is subject to customary approvals.

 

Third Quarter 2019 Operational and Financial Highlights

 

•Total solar module shipments were 3,326 megawatts ("MW"), a decrease of 1.8% from 3,386 MW in the second quarter of 2019 and an increase of 12.6% from 2,953 MW in the third quarter of 2018.
•Total revenues were RMB7.48 billion (US$1.05 billion), an increase of 8.2% from the second quarter of 2019 and an increase of 11.8% from the third quarter of 2018.
•Gross margin was 21.3%, compared with 16.5% in the second quarter of 2019, and 14.9% in the third quarter of 2018. Excluding the Countervailing Duty (“CVD”) and Anti-dumping Duty (“ADD”) reversal benefit, gross margin was 18.5% in the third quarter of 2019.
•Income from operations was RMB638.8 million (US$89.4 million), compared with RMB260.3 million in the second quarter of 2019 and RMB188.0 million in the third quarter of 2018.
•Net income attributable to the Company’s ordinary shareholders was RMB363.6 million (US$50.9 million) in the third quarter of 2019, compared with RMB125.4 million in the second quarter of 2019 and RMB189.1 million in the third quarter of 2018.
•Diluted earnings per American depositary share ("ADS") were RMB4.664 (US$0.652) in the third quarter of 2019.
•Non-GAAP net income attributable to the Company's ordinary shareholders in the third quarter of 2019 was RMB301.2 million (US$42.1 million), compared with RMB202.9 million in the second quarter of 2019 and RMB206.3 million in the third quarter of 2018.
•Non-GAAP basic and diluted earnings per ADS were RMB6.832 (US$0.956) and RMB6.128 (US$0.856), respectively, in the third quarter of 2019, compared with both RMB4.872 in the second quarter of 2019 and both RMB5.280 in the third quarter of 2018.

 

 

 

Mr. Kangping Chen, JinkoSolar's Chief Executive Officer commented, “I’m pleased to report strong operational and financial results for the third quarter which I believe marks a turning point for our business, as we begin to increasingly benefit from our technology transformation, industry-leading cost structure and expanding mono capacity. Module shipments during the quarter were 3,326 megawatts, an increase of 12.6% year-over-year and a slight decrease sequentially. Our integrated production costs continued to decrease, which, combined with our high-quality products and global distribution footprint, allowed us to initiate a reset of our gross margin, expanding it to 21.3% during the quarter, a significant 6 percentage point increase year-over-year. We are very optimistic about our growth prospects next quarter and throughout 2020 where we expect to see our overall profitability strengthen and margins expand.”

 

“Our technological transformation began in 2016 when we started producing mono wafers, and have since then accumulated three years of operational and technical expertise which we applied in our mono production facility in Leshan, Sichuan Province. This technological transformation is now largely complete, with Phase I of the production facility having begun operations and ramped up to full 5GW capacity during the second quarter of 2019. I believe this reflects our strategic foresight and strong execution capabilities. We are now at a strategic turning point in our corporate history with mono-based high-efficiency products accounting for nearly 75% of the total solar module shipments during the quarter, which is expected to increase to 99% in 2020.”

 

“The late announcement of the government subsidy policy for PV projects in China earlier this year delayed a large number of projects which we believe will restart during the fourth quarter and the first quarter of 2020. This delay is expected to drive strong domestic demand over the next six months, especially since China’s national renewable energy information management center recently announced that it is accelerating the formulation of subsidy policies for PV projects in 2020. With the cost of solar energy now falling below that of conventional energy sources in many markets across the globe and more aggressive clean energy targets being set by governments, we are also very confident and optimistic that global demand will significantly increase next year. We currently estimate that global installations next year will be approximately 20% higher than this year.”

 

 

 

“We continue to invest in product development to meet growing market demand for high-quality and efficient products. We expanded our production capacity of N-type cells to 800MW during the quarter, and are currently ramping up to full production which is expected to begin next quarter. Our N-type cells reached a record high efficiency of 24.58% in June 2019. We also recently unveiled a new Tiger module which, with its 20.78% efficiency and peak power output of 460W, offers our clients significantly improved efficiency, lower production costs and a better internal rate of return.”

 

“With domestic demand rebounding strongly and overseas demand driven by aggressive new clean energy targets, we expect the fourth quarter and full year 2020 to generate strong growth in shipments and strengthen our overall profitability and margin profile. With the demand growing rapidly both domestically and overseas for our mono products, we have strategically decided to convey our confidence in next year’s strong growth with total solar module shipments expected to be in the range of 18.0 GW to 20.0 GW for the full year 2020, an approximately 35% year-over-year increase. As one of the largest and most innovative solar module manufacturers in the world, we will continue to drive growth in this new era of grid parity and deliver long-term sustainable value to our shareholders.”

 

Third Quarter 2019 Financial Results

 

Total Revenues

 

Total revenues in the third quarter of 2019 were RMB7.48 billion (US$1.05 billion), an increase of 8.2% from RMB6.91 billion in the second quarter of 2019 and an increase of 11.8% from RMB6.69 billion in the third quarter of 2018. The sequential increase was mainly attributable to an increase in the average selling price of solar modules and increase of multi-crystalline silicon wafers sales in the third quarter of 2019. The year-over-year increase was mainly attributable to an increase in the shipment of solar modules in the third quarter of 2019.

 

Gross Profit and Gross Margin

 

Gross profit in the third quarter of 2019 was RMB1.59 billion (US$223.0 million), compared with RMB1.14 billion in the second quarter of 2019 and RMB997.6 million in the third quarter of 2018. The sequential increase was mainly attributable to (i) an increase in self-produced production volume by increasing shift toward integrated mono-based high-efficiency products capacity, (ii) continued reduction of integrated production cost, which maintains its industry-leading cost structure, and (iii) an increase in the average selling price of solar modules, and (iv) the reversal benefit of CVD and ADD of RMB 212.0 million (US$29.7 million), based on the final results of the fifth administrative review of the CVD and ADD order published by the U.S. Department of Commerce.

 

 

 

Gross margin was 21.3% in the third quarter of 2019, compared with 16.5% in the second quarter of 2019 and 14.9% in the third quarter of 2018. Excluding the CVD and ADD reversal benefit, gross margin was 18.5% in the third quarter of 2019, compared with 16.5% in the second quarter of 2019 and 12.8% in the third quarter of 2018. The sequential increase was attributable to (i) an increase in self-produced volume by increasing shift toward integrated mono-based high-efficiency products capacity, (ii) continued reduction of integrated production cost, which maintains its industry-leading cost structure, and (iii) an increase in the average selling price of solar modules.

 

Income from Operations and Operating Margin

 

Income from operations in the third quarter of 2019 was RMB638.8 million (US$89.4 million), compared with RMB260.3 million in the second quarter of 2019 and RMB188.0 million in the third quarter of 2018. Operating margin in the third quarter of 2019 was 8.5%, compared with 3.8% in the second quarter of 2019 and 2.8% in the third quarter of 2018. Excluding the CVD and ADD reversal benefit, operating margin in the third quarter of 2019 was 5.7%.

 

Total operating expenses in the third quarter of 2019 were RMB955.0 million (US$133.6 million), an increase of 8.1% from RMB883.6 million in the second quarter of 2019 and an increase of 18.0% from RMB809.6 million in the third quarter of 2018. The sequential increase was mainly due to an increase in shipping cost and loss on disposal of property, plant and equipment of RMB 42.1 million. The year-over-year increase was primarily due to an increase in shipping costs in the third quarter of 2019.

 

Total operating expenses accounted for 12.8% of total revenues in the third quarter of 2019, compared to 12.8% in the second quarter of 2019 and 12.1% in the third quarter of 2018. The year-over-year increase of operating expenses as a percentage of total revenue was primarily due to the increase in shipping costs as a percentage of total revenue associated with a higher percentage of shipments to overseas markets in the third quarter of 2019.

 

Interest Expense, Net

 

Net interest expense in the third quarter of 2019 was RMB94.9 million (US$13.3 million), a decrease of 18.7% from RMB116.8 million in the second quarter of 2019 and an increase of 70.7% from RMB55.6 million in the third quarter of 2018. The sequential decrease was mainly due to a decrease in interest expense associated with discounted notes receivables in the third quarter of 2019. The year-over-year increase was mainly due to (i) an increase in borrowings, (ii) the cessation of interest capitalization on certain completed solar projects, and (iii) issuance of additional convertible senior notes in May 2019.

 

 

 

Exchange (Loss)/Gain and Change in Fair Value of Foreign Exchange Derivatives

 

The Company recorded a net exchange loss (including Change in fair value of foreign exchange derivatives) of RMB130.7 million (US$18.3 million) in the third quarter of 2019, compared to a net exchange gain of RMB45.9 million in the second quarter of 2019 and a net exchange gain of RMB85.0 million in the third quarter of 2018. Given the rapid increase of overseas orders, the Company increased the foreign currency hedge ratio to hedge the next six months’ anticipated cash flow denominated in U.S. dollars. The Company recorded a loss arising from foreign exchange forward contracts with the appreciation of the U.S. dollars against the RMB in the third quarter of 2019.

 

Change in Fair Value of Interest Rate Swap

 

The Company entered into Interest Rate Swap agreements with several banks for the purpose of reducing interest rate risk exposure associated with the Company’s overseas solar power projects. The Company recorded a loss arising from change in fair value of interest rate swap of RMB18.1 million (US$2.5 million) in the third quarter of 2019, compared to a loss of RMB46.1 million in the second quarter of 2019. The loss arising from change in fair value of interest swap was primarily due to a continuous decrease in long-term interest rates. The Company did not elect to use hedge accounting for any of its derivatives.

 

Change in Fair Value of Convertible Senior Notes and Call Option

 

The Company issued US$85.0 million of 4.5% convertible senior notes due 2024 (the “Notes”) in May 2019 and has elected to measure the Notes at fair value. The Company recognized gain from a change in fair value of the Notes of RMB157.1 million (US$22.0million) in the third quarter of 2019, compared to a loss of RMB118.6 million in the second quarter of 2019. The change was primarily due to a decrease in the stock price of the Company in the third quarter of 2019.

 

 

 

Concurrent with the issuance of the Notes in May 2019, the Company entered into a call option transaction with an affiliate of Credit Suisse Securities (USA) LLC. The Company accounted for the call option transactions as freestanding derivative assets in its consolidated balance sheets, which is marked to market at each reporting period. The Company recorded a loss from a change in fair value of the call option of RMB74.2 million (US$10.4 million) in the third quarter of 2019, compared to a gain of RMB73.5 million in the second quarter of 2019. The change was primarily due to a decrease in the stock price of the Company in the third quarter of 2019.

 

Equity in (Loss)/Income of Affiliated Companies

 

The Company indirectly holds a 20% equity interest in Sweihan PV Power Company P.J.S.C, a developer and operator of solar power projects in Dubai, and accounts for its investment using the equity method. The Company also holds a 30% equity interest in Jiangsu Jinko-Tiansheng Co., Ltd, which processes and assembles PV modules as an OEM manufacturer, and accounts for its investments using the equity method. The Company recorded equity in loss of affiliated companies of RMB28.3 million (US$4.0 million) in the third quarter of 2019, compared with a loss of RMB28.6 million in the second quarter of 2019 and an income of RMB4.9 million in the third quarter of 2018. The loss primarily arose from change in fair value of interest rate swap agreements purchased by Sweihan PV Power Company P.J.S.C. due to a continuous decrease in long-term interest rates. Hedge accounting was not applied for the derivative.

 

Income Tax Benefit / (Expense), Net

 

The Company recorded an income tax expense of RMB117.2 million (US$16.4 million) in the third quarter of 2019, compared with an income tax benefit of RMB55.9 million in the second quarter of 2019 and an income tax expense of RMB61.2 million in the third quarter of 2018.

 

The sequential change was mainly due to additional 2018 income tax deduction for R&D costs approved by the local tax bureau in the second quarter of 2019.

 

Net Income and Earnings per Share

 

Net income attributable to the Company’s ordinary shareholders was RMB363.6 million (US$50.9 million) in the third quarter of 2019, compared with RMB125.4 million in the second quarter of 2019 and RMB189.1 million in the third quarter of 2018.

 

Basic and diluted earnings per ordinary share were RMB2.062 (US$0.288) and RMB1.166 (US$0.163), respectively, during the third quarter of 2019. This translates into basic and diluted earnings per ADS of RMB8.248 (US$1.152) and RMB4.664 (US$0.652), respectively.

 

Non-GAAP net income attributable to the Company's ordinary shareholders in the third quarter of 2019 was RMB301.2 million (US$42.1 million), compared with RMB202.9 million in the second quarter of 2019 and RMB206.3 million in the third quarter of 2018.

 

 

 

Non-GAAP basic and diluted earnings per ordinary share were RMB1.708 (US$0.239) and RMB1.532 (US$0.214), respectively, during the third quarter of 2019. This translates into non-GAAP basic and diluted earnings per ADS of RMB6.832 (US$0.956) and RMB6.128 (US$0.856), respectively.

 

Financial Position

 

As of September 30, 2019, the Company had RMB4.14 billion (US$579.8 million) in cash and cash equivalents and restricted cash, compared with RMB4.81 billion as of June 30, 2019.

 

As of September 30, 2019, the Company’s accounts receivables due from third parties were RMB4.44 billion (US$621.3million), compared with RMB4.94 billion as of June 30, 2019.

 

As of September 30, 2019, the Company’s inventories were RMB6.07 billion (US$849.6 million), compared with RMB6.63 billion as of June 30, 2019.

 

Receivables related to CVD and ADD reversal benefits with the amount of RMB 427.1 million (US$59.7 million) were record as non-current assets under the line item "Other assets - third parties" on the Company’s balance sheet as of September 30, 2019 based on the Company’s latest best estimate of related cash collection.  

 

As of September 30, 2019, the Company's total interest-bearing debts were RMB12.22 billion (US$1.71 billion), of which RMB2.21 billion (US$309.2 million) was related to the Company’s overseas downstream solar projects, compared with RMB13.34 billion, of which RMB2.16 billion was related to the Company’s overseas downstream solar projects, as of June 30, 2019. The decrease of interest-bearing debts was mainly due to a decrease in borrowings.

 

In November, the Company entered into an agreement to sell two solar power plants in Mexico with a combined capacity of 155 MW to White River Renewables, a Mexican renewable energy company. White River Renewables is jointly sponsored by Riverstone Holdings, an energy and power-focused private investment firm, and White Summit Capital, a Switzerland-based infrastructure investments and asset management firm. The final closing of the transaction is subjected to customary approvals. The sale of overseas power plants is consistent with the Company’s growth strategy to focus on its solar manufacturing business.

 

Assets and liabilities related to these two solar power plants were reclassified as assets/liabilities held for sale as of September 30, 2019. The Company will further strengthen its balance sheet by reducing RMB950.2 million (US$132.9 million) of interest-bearing debts once the transaction is completed.

 

 

 

Third Quarter 2019 Operational Highlights

 

Solar Module Shipments

 

Total solar module shipments in the third quarter of 2019 were 3,326 MW.

 

Solar Products Production Capacity

 

As of September 30, 2019, the Company's in-house annual silicon wafer, solar cell and solar module production capacity was 14.5 GW (including 11.0 GW of mono wafers), 9.2 GW (all for PERC cells) and 15.0 GW, respectively.

 

JinkoSolar expects its annual silicon wafer, solar cell and solar module production capacity to reach 15.0 GW (including 11.5 GW of mono wafers), 10.6 GW (including 9.8 GW of PERC cells) and 16.0 GW, respectively, by the end of 2019.

 

Operations and Business Outlook

 

Fourth Quarter and Full Year 2019 Guidance

 

The Company's business outlook is based on management's current views and estimates with respect to market conditions, production capacity, the Company's order book and the global economic environment. This outlook is subject to uncertainty on final customer demand and sale schedules. Management's views and estimates are subject to change without notice.

 

For the fourth quarter of 2019, the Company does not expect the benefit of Anti-dumping (“ADD”) and Countervailing Duty (“CVD”) and expects total solar module shipments to be in the range of 4.2 GW to 4.4 GW. Total revenue for the fourth quarter is expected to be in the range of US$1.17 billion to US$1.23 billion. Gross margin for the fourth quarter is expected to be between 18.5% and 20.5%.

 

 

 

For the full year 2019, the Company estimates total solar module shipments to be in the range of 14.0 GW to 14.2 GW.

 

Full Year 2020 Guidance

 

Solar Module Shipments

 

Total solar module shipments for the full year of 2020 would be in the range of 18.0 GW to 20.0 GW

 

Solar Products Production Capacity

 

JinkoSolar expects its annual silicon wafer, solar cell and solar module production capacity to reach 20.0 GW (including 18.0 GW of mono wafers), 10.6 GW (including 800 MW N-type cells) and 22.0 GW, respectively, by the end of 2020.

 

Recent Business Developments

 

•In September, JinkoSolar was invited to the UN Climate Action Summit 2019 which was held at the UN headquarters in New York on September 23, 2019.
•In September, JinkoSolar signed a module supply contract with METKA EGN, a world-class EPC contractor, for 300 MW of JinkoSolar’s ultra-high efficiency Cheetah modules to be installed at a large-scale solar power plant in the municipality of Talaván, Cáceres, Spain.
•In September, JinkoSolar committed to the RE100 and EP100 initiatives. These global campaigns are led by The Climate Group, an international non-profit organization working closely with powerful business networks and governments to bring innovative solutions to scale.
•In October, SelectUSA presented JinkoSolar with a Certificate of Appreciation in recognition of its module assembly facility in Jacksonville, Florida and the positive investment in the United States leading to job creation and economic growth.
•In October, JinkoSolar launched a new high efficiency Tiger module using 9-busbar Mono PERC and Tiling Ribbon (TR) technology at All-Energy Australia 2019, Australia's largest national showcase of clean and renewable energy.
•In November, JinkoSolar expanded its high-efficiency mono wafer production capacity at its production facility in Leshan, Sichuan Province, with an additional 5GW.
•In November, JinkoSolar joined the board of directors at the Solar Energy Industries Association (SEIA), the national trade association representing the U.S. solar energy industry.
•In November, JinkoSolar recognized as a China National Manufacturing Champion in the latest published list by the MIIT and the CFIE for its excellence in the manufacturing of its major product, solar modules.

 

 

 

Conference Call Information

 

JinkoSolar's management will host an earnings conference call on Tuesday, November 19, 2019 at 7:30 a.m. U.S. Eastern Time (8:30 p.m. Beijing / Hong Kong the same day).

 

Dial-in details for the earnings conference call are as follows:

 

Hong Kong / International: +852 3027 6500
U.S. Toll Free: +1 855-824-5644
Passcode: 22225201#

 

Please dial in 10 minutes before the call is scheduled to begin and provide the passcode to join the call.

 

A telephone replay of the call will be available 2 hours after the conclusion of the conference call through 23:59 U.S. Eastern Time, November 26, 2019. The dial-in details for the replay are as follows:

 

International: +61 2 8325 2405
U.S.: +1 646 982 0473
Passcode: 319324284#

 

Additionally, a live and archived webcast of the conference call will be available on the Investor Relations section of JinkoSolar's website at www.jinkosolar.com.

 

About JinkoSolar Holding Co., Ltd.

 

JinkoSolar (NYSE: JKS) is one of the largest and most innovative solar module manufacturers in the world. JinkoSolar distributes its solar products and sells its solutions and services to a diversified international utility, commercial and residential customer base in China, the United States, Japan, Germany, the United Kingdom, Chile, South Africa, India, Mexico, Brazil, the United Arab Emirates, Italy, Spain, France, Belgium, and other countries and regions. JinkoSolar has built a vertically integrated solar product value chain, with an integrated annual capacity of 14.5 GW for silicon wafers, 9.2 GW for solar cells, and 15 GW for solar modules, as of September 30, 2019.

 

 

 

JinkoSolar has over 15,000 employees across its 7 productions facilities globally, 15 oversea subsidiaries in Japan, Korea, Singapore, India, Turkey, Germany, Italy, Switzerland, United States, Canada, Mexico, Brazil, Chile, Australia and United Arab Emirates, and global sales teams in China, United Kingdom, France, Netherlands, Spain, Bulgaria, Greece, Romania, Ukraine, Jordan, Saudi Arabia, Tunisia, Egypt, Morocco, Nigeria, Kenya, South Africa, Costa Rica, Colombia, Panama and Argentina.

 

To find out more, please see: www.jinkosolar.com

 

Use of Non-GAAP Financial Measures

 

To supplement its consolidated financial results presented in accordance with United States Generally Accepted Accounting Principles ("GAAP"), JinkoSolar uses certain non-GAAP financial measures including, non-GAAP net income, non-GAAP earnings per Share, and non-GAAP earnings per ADS, which are adjusted from the comparable GAAP results to exclude certain expenses or incremental ordinary shares relating to share-based compensation and, convertible senior notes:

 

•Non-GAAP net income is adjusted to exclude the expenses relating to issuance cost of convertible senior notes, change in fair value of convertible senior notes and call option, interest expenses of convertible senior notes, exchange gain on the convertible senior notes, and stock-based compensation; given these Non-GAAP net income adjustments above are either related to the Company or its subsidiaries incorporated in Cayman Islands, which are not subject to tax exposures, or related to those subsidiaries with tax loss positions which result in no tax impacts, therefore no tax adjustment is needed in conjunction with these Non-GAAP net income adjustments; and
•Non-GAAP earnings per Share and non-GAAP earnings per ADS are adjusted to exclude the expenses relating to issuance cost of convertible senior notes, change in fair value of convertible senior notes and call option, interest expenses of convertible senior notes, exchange gain on the convertible senior notes, and stock-based compensation.

 

The Company believes that the use of non-GAAP information is useful for analysts and investors to evaluate JinkoSolar's current and future performances based on a more meaningful comparison of net income and diluted net income per ADS when compared with its peers and historical results from prior periods. These measures are not intended to represent or substitute numbers as measured under GAAP. The submission of non-GAAP numbers is voluntary and should be reviewed together with GAAP results.

 

 

 

Currency Convenience Translation

 

The conversion of Renminbi into U.S. dollars in this release, made solely for the convenience of the readers, is based on the noon buying rate in the city of New York for cable transfers of Renminbi as certified for customs purposes by the Federal Reserve Bank of New York as of September 30, 2019, which was RMB7.1477 to US$1.00. No representation is intended to imply that the Renminbi amounts could have been, or could be, converted, realized, or settled into U.S. dollars at that rate or any other rate. The percentages stated in this press release are calculated based on Renminbi.

 

Safe-Harbor Statement

 

This press release contains forward-looking statements. These statements constitute "forward-looking" statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, and as defined in the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements can be identified by terminology such as "will," "expects," "anticipates," "future," "intends, "plans," "believes," "estimates" and similar statements. Among other things, the quotations from management in this press release and the Company's operations and business outlook, contain forward-looking statements. Such statements involve certain risks and uncertainties that could cause actual results to differ materially from those in the forward-looking statements. Further information regarding these and other risks is included in JinkoSolar's filings with the U.S. Securities and Exchange Commission, including its annual report on Form 20-F. Except as required by law, the Company does not undertake any obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise.

 

For investor and media inquiries, please contact:

 

In China:
Ripple Zhang
JinkoSolar Holding Co., Ltd.
Tel: +86 21-5183-3105
Email: ir@jinkosolar.com

 

Christian Arnell
Christensen
Tel: +86-10-5900-2940

Email: carnell@christensenir.com

 

In the U.S.:
Ms. Linda Bergkamp

Christensen

Tel: +1-480-614-3004

Email: lbergkamp@ChristensenIR.com

 

 

 

 

 

JINKOSOLAR HOLDING CO., LTD.

UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(in thousands, except ADS and Share data)

 

   For the quarter ended    For the nine months ended 
   September 30, 2018   June 30, 2019   September 30, 2019    September 30, 2018   September 30, 2019 
   RMB   RMB   RMB   USD    RMB   RMB   USD 
Revenues from third parties   6,601,414    6,912,301    7,473,562    1,045,590     15,891,621    20,063,090    2,806,930 
                                     
Revenues from related parties   93,401    725    8,194    1,146     1,430,661    153,740    21,509 
                                     
Total revenues   6,694,815    6,913,026    7,481,756    1,046,736     17,322,282    20,216,830    2,828,439 
                                     
Cost of revenues   (5,697,186)   (5,769,143)   (5,888,015)   (823,764)    (14,940,962)   (16,514,869)   (2,310,515)
                                     
Gross profit   997,629    1,143,883    1,593,741    222,972     2,381,320    3,701,961    517,924 
                                     
Operating expenses:                                    
Selling and marketing   (476,640)   (561,959)   (596,192)   (83,410)    (1,156,613)   (1,617,465)   (226,292)
General and administrative   (228,862)   (248,376)   (276,699)   (38,712)    (530,201)   (716,977)   (100,309)
Research and development   (104,105)   (73,258)   (82,059)   (11,480)    (272,394)   (232,695)   (32,555)
Impairment of long-lived assets   -    -    -    -     (14,548)   -    - 
Total operating expenses   (809,607)   (883,593)   (954,950)   (133,602)    (1,973,756)   (2,567,137)   (359,156)
                                     
Income from operations   188,022    260,290    638,791    89,370     407,564    1,134,824    158,768 
Interest expenses, net   (55,600)   (116,754)   (94,892)   (13,276)    (221,645)   (307,756)   (43,057)
Subsidy income   4,742    10,517    33,394    4,673     43,942    48,651    6,808 
Exchange gain   118,712    87,487    16,304    2,281     69,687    22,811    3,191 
Change in fair value of interest rate swap   12,781    (46,118)   (18,123)   (2,536)    39,646    (94,440)   (13,213)
Change in fair value of foreign exchange derivatives   (33,726)   (41,619)   (146,998)   (20,566)    (46,238)   (170,503)   (23,854)
Convertible senior notes issuance costs   -    (18,646)   -    -     -    (18,646)   (2,609)
Change in fair value of convertible senior notes and call option   -    (45,070)   82,932    11,603     -    37,862    5,297 
Other income, net   9,983    7,302    1,742    244     28,105    16,442    2,300 
Loss from disposal of subsidiaries   -    -    -    -     (9,425)   -    - 
Income before income taxes   244,914    97,389    513,150    71,793     311,636    669,245    93,631 
Income tax (expense)/benefit   (61,157)   55,917    (117,152)   (16,390)    (47,860)   (56,986)   (7,973)
Equity in (loss)/gain of affiliated companies   4,916    (28,621)   (28,305)   (3,960)    27,699    (80,635)   (11,281)
Net income   188,673    124,685    367,693    51,443     291,475    531,624    74,377 
Less: Net income/(loss) attributable to non-controlling interests   (415)   (725)   4,129    578     (191)   2,465    345 
Net income attributable to JinkoSolar Holding Co., Ltd.'s ordinary shareholders   189,088    125,410    363,564    50,865     291,666    529,159    74,032 
                                     
Net income attributable to JinkoSolar Holding Co., Ltd.'s ordinary shareholders per share:                                    
Basic   1.210    0.753    2.062    0.288     1.910    3.176    0.444 
Diluted   1.210    0.315    1.166    0.163     1.900    3.007    0.421 
                                     
Net income attributable to JinkoSolar Holding Co., Ltd.'s ordinary shareholders per ADS:                                    
Basic   4.840    3.012    8.248    1.152     7.640    12.704    1.776 
Diluted   4.840    1.260    4.664    0.652     7.600    12.028    1.684 
                                     
Weighted average ordinary shares outstanding:                                    
Basic   156,485,510    166,605,808    176,336,307    176,336,307     152,777,860    166,612,951    166,612,951 
Diluted   156,703,443    165,385,410    196,544,769    196,544,769     153,445,140    177,583,926    177,583,926 
                                     
Weighted average ADS outstanding:                                    
Basic   39,121,378    41,651,452    44,084,077    44,084,077     38,194,465    41,653,238    41,653,238 
Diluted   39,175,861    41,346,352    49,136,192    49,136,192     38,361,285    44,395,981    44,395,981 
                                     
UNAUDITED CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME  
   
Net income   188,673    124,685    367,693    51,443     291,475    531,624    74,377 
                                     
Other comprehensive income:                                    
-Foreign currency translation adjustments   28,720    48,233    (666)   (122)    43,335    41,144    5,756 
-Change in the instrument-specific credit risk   -    5,546    5,546    805     -    57    8 
Comprehensive income   217,393    178,464    372,573    52,126     334,810    572,825    80,141 
Less: Comprehensive income/(loss) attributable to non-controlling interests   (415)   (725)   4,129    578     (191)   2,465    345 
Comprehensive income attributable to JinkoSolar Holding Co., Ltd.'s ordinary shareholders   217,808    179,189    368,444    51,548     335,001    570,360    79,796 
                                     
Reconciliation of GAAP and non-GAAP Results                            
                                     
1. Non-GAAP earnings per share and non-GAAP earnings per ADS                            
                                     
GAAP net income attributable to ordinary shareholders   189,088    125,410    363,564    50,865     291,666    529,159    74,032 
                                     
Convertible senior notes issuance costs   -    18,646    -    -     -    18,646    2,609 
                                     
Change in fair value of convertible senior notes and call option   -    45,070    (82,932)   (11,603)    -    (37,862)   (5,297)
                                     
Net interest expenses of convertible senior notes and call option   1    2,914    6,190    866     2    9,103    1,274 
                                     
Exchange loss/(gain) on convertible senior notes and call option   3    (721)   7,834    1,096     3    7,114    995 
                                     
Stock-based compensation expense   17,255    11,587    6,546    916     32,331    11,208    1,568 
                                     
Non-GAAP net income attributable to ordinary shareholders   206,347    202,906    301,202    42,140     324,002    537,368    75,181 
                                     
Non-GAAP earnings per share attributable to ordinary shareholders -                                    
Basic   1.320    1.218    1.708    0.239     2.120    3.225    0.451 
Diluted   1.320    1.218    1.532    0.214     2.110    3.026    0.423 
                                     
Non-GAAP earnings per ADS attributable to ordinary shareholders -                                    
Basic   5.280    4.872    6.832    0.956     8.480    12.900    1.804 
Diluted   5.280    4.872    6.128    0.856     8.440    12.104    1.692 
                                     
Non-GAAP weighted average ordinary shares outstanding                                    
Basic   156,485,510    166,605,808    176,336,307    176,336,307     152,777,860    166,612,951    166,612,951 
Diluted   156,703,443    166,605,808    196,544,769    196,544,769     153,445,140    177,583,926    177,583,926 
                                     
Non-GAAP weighted average ADS outstanding                                    
Basic   39,121,378    41,651,452    44,084,077    44,084,077     38,194,465    41,653,238    41,653,238 
Diluted   39,175,861    41,651,452    49,136,192    49,136,192     38,361,285    44,395,982    44,395,982 

 

 

 

 

JINKOSOLAR HOLDING CO., LTD.

UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS

(in thousands)

  

   December 31, 2018   Sep 30, 2019 
   RMB   RMB   USD 
ASSETS            
Current assets:               
  Cash and cash equivalents   3,104,917    3,705,424    518,408 
  Restricted cash   377,111    439,052    61,426 
  Restricted short-term investments   4,058,419    6,457,776    903,476 
  Accounts receivable, net - related parties   675,768    518,402    72,527 
  Accounts receivable, net - third parties   5,436,371    4,440,765    621,286 
  Notes receivable, net - third parties   1,010,469    1,926,626    269,545 
  Advances to suppliers, net - third parties   665,221    1,877,763    262,709 
  Inventories, net   5,743,328    6,072,596    849,587 
  Forward contract receivables   1,192    741    104 
  Prepayments and other current assets - related parties   67,730    57,407    8,032 
  Derviatvie assets   847    -    - 
  Prepayments and other current assets   1,712,889    1,797,770    251,516 
  Held-for-sale assets*   -    1,235,274    172,821 
Total current assets   22,854,262    28,529,596    3,991,437 
                
Non-current assets:               
  Restricted cash   921,300    641,137    89,698 
  Project Assets   1,770,621    1,572,070    219,941 
  Long-term investments   25,531    247,757    34,662 
  Property, plant and equipment, net   8,275,900    8,704,097    1,217,748 
  Land use rights, net   574,945    600,989    84,081 
  Intangible assets, net   35,361    34,850    4,876 
  Financing lease right-of-use assets, net   -    971,484    135,916 
  Operating lease right-of-use assets, net   -    259,763    36,342 
  Deferred tax assets   338,069    331,508    46,380 
  Call Option-concurrent with issuance of convertible senior notes   -    211,524    29,593 
  Other assets - related parties   144,984    113,705    15,908 
  Other assets - third parties   912,210    2,808,288    392,894 
Total non-current assets   12,998,921    16,497,172    2,308,039 
                
Total assets   35,853,183    45,026,768    6,299,476 
                
LIABILITIES               
Current liabilities:               
  Accounts payable - related parties   698    7,018    982 
  Accounts payable - third parties   5,327,094    4,791,342    670,333 
  Notes payable - related parties   35,000    -    - 
  Notes payable - third parties   6,036,577    8,076,603    1,129,958 
  Accrued payroll and welfare expenses   810,921    792,067    110,814 
  Advances from related parties   910    915    128 
  Advances from  third parties   2,395,229    3,987,764    557,909 
  Income tax payable   70,240    111,382    15,583 
  Other payables and accruals   2,281,025    2,873,540    402,023 
  Other payables due to related parties   20,819    15,582    2,180 
  Forward contract payables   9,464    112,133    15,688 
  Convertible senior notes - current   69    -    - 
  Financing lease liabilities - current   -    252,899    35,382 
  Operating lease liabilities - current   -    31,076    4,348 
  Derivative liability -  current   12,786    -    - 
  Bond payable and accrued interests   10,318    -    - 
  Short-term borrowings from third parties, including current portion of long-term bank borrowings   7,103,399    7,880,570    1,102,532 
  Guarantee liabilities to related parties   26,639    24,867    3,479 
  Held-for-sale liabilities*   -    1,075,166    150,421 
Total current liabilities   24,141,188    30,032,924    4,201,760 
                
Non-current liabilities:               
  Long-term borrowings   1,954,831    2,023,159    283,050 
  Convertible senior notes   -    557,182    77,953 
  Long-term payables   338,412    -    - 
  Bond payables   299,475    -    - 
  Accrued warranty costs - non current   573,641    605,940    84,774 
  Financing lease liabilities*   -    294,194    41,159 
  Operating lease liabilities*   -    229,902    32,165 
  Deferred tax liability   25,893    25,893    3,623 
  Guarantee liabilities to related parties - non current   65,765    46,492    6,504 
Total non-current liabilities   3,258,017    3,782,762    529,228 
                
Total liabilities   27,399,205    33,815,686    4,730,988 
                
SHAREHOLDERS' EQUITY               
Ordinary shares (US$0.00002 par value, 500,000,000 shares authorized, 156,864,737 and  177,185,237 shares issued and outstanding as of  December 31, 2018 and September 30, 2019, respectively)   22    25    3 
Additional paid-in capital   4,010,740    4,549,236    636,462 
Statutory reserves   570,176    570,176    79,771 
Accumulated other comprehensive income   70,301    111,502    15,599 
Treasury stock, at cost; 1,723,200 ordinary shares as of  December 31, 2018 and September 30, 2019   (13,876)   (13,876)   (1,941)
Accumulated retained earnings   3,202,528    3,731,687    522,082 
                
Total JinkoSolar Holding Co., Ltd. shareholders' equity   7,839,891    8,948,750    1,251,976 
                
Non-controlling interests   614,087    2,262,332    316,512 
                
Total liabilities and shareholders' equity   35,853,183    45,026,768    6,299,476 

 

Note: *In November, the Company entered into an agreement to sell two solar power plants in Mexico with a combined capacity of 155 MW to White River Renewables, a Mexican renewable energy company. Assets and liabilities related to these two solar power plants were reclassified as assets/liabilities held for sale as of September 30, 2019.