First Solar, Inc. Announces First Quarter 2021 Financial Results

Rhea-AI Summary

First Solar, Inc. (Nasdaq: FSLR) reported first-quarter net sales of $803 million, an increase of $194 million from the previous quarter, driven by robust U.S. project sales. The net income per share rose to $1.96 from $1.08 in the prior quarter. Cash and cash equivalents remain steady at $1.8 billion. The company maintains its 2021 EPS guidance at $4.05 to $4.75. Operational metrics include a nameplate manufacturing capacity increase to 7.9 GWDC and a year-to-date net booking of 4.8 GWDC.

Positive

• Net sales increased by $194 million to $803 million.
• Net income per share rose to $1.96 from $1.08 in the prior quarter.
• Cash and cash equivalents totaled $1.8 billion, unchanged from the prior quarter.
• Year-to-date net bookings reached 4.8 GWDC.
• Nameplate manufacturing capacity increased to 7.9 GWDC.

Negative

• Increased operational expenses related to the ramp of the new factory in Malaysia and production start-up expenses.

• Net sales of $803 million
• Net income per share of $1.96
• Cash, cash equivalents, restricted cash, and marketable securities of $1.8 billion
• YTD net bookings of 4.8 GW_DC; 2.9 GW_DC since prior earnings call
• Nameplate manufacturing capacity increased to 7.9 GW_DC; top production bin of 455 watts
• Completed sales of U.S. project development and North American O&M businesses
• Maintain 2021 EPS guidance of $4.05 to $4.75
  

TEMPE, Ariz., April 29, 2021 (GLOBE NEWSWIRE) -- First Solar, Inc. (Nasdaq: FSLR) today announced financial results for the first quarter ended March 31, 2021.

“We delivered strong operational and financial results for the first quarter, and demand for our Series 6 technology continues to be robust,” said Mark Widmar, CEO of First Solar. “The dedication we continue to witness from our associates enabled us to deliver module segment gross margin in line with our first quarter guidance, complete the sales of our Sun Streams 2, 4, and 5 projects, and close the U.S. project development and North American O&M sales. This, coupled with manufacturing execution, enabled us to deliver solid EPS in the first quarter.”

Net sales for the first quarter were $803 million, an increase of $194 million from the prior quarter, primarily due to an increase in systems revenue driven by U.S. project sales.

Operating income for the first quarter was $252 million, compared to $58 million in the prior quarter. First quarter operating income includes depreciation and amortization of $63 million, share-based compensation of $3 million, charges associated with the initial ramp of our new factory in Malaysia, underutilization expense, and production start-up expense totaling $16 million, and a gain on the sales of our U.S. project development and North American O&M businesses of $151 million.

Net income per share for the first quarter was $1.96, compared to net income per share of $1.08 in the prior quarter.

Cash, cash equivalents, restricted cash, and marketable securities at the end of the first quarter totaled $1.8 billion, which was largely unchanged from the prior quarter. This was primarily due to proceeds from the sale of our North American O&M business and proceeds from the sale of certain securities associated with our end of life module collection and recycling program, which we intend to subsequently reinvest. This was partially offset by an increase in accounts receivable related to our U.S. project development and Sun Streams 2, 4, and 5 sales, along with operating expenses, capital expenditures, and payment of variable compensation.

2021 guidance has been updated as follows:

	Prior	Current
Net Sales	$2.85B to $3.0B	$2.85B to $3.025B
Gross Margin ($) (1)	$710M to $775M	$695M to $775M
Operating Expenses (2)	$285M to $300M	Unchanged
Operating Income (3)(4)	$545M to $640M	Unchanged
Earnings per Share	$4.05 to $4.75	Unchanged
Net Cash Balance (5)	$1.8B to $1.9B	Unchanged
Capital Expenditures	$425M to $475M	Unchanged
Shipments	7.8GW to 8.0GW	Unchanged

——————————
(1)   Includes of $1 million of ramp related expense ($5 million to $10 million previously) and $40 million of underutilization losses (unchanged)
(2)   Includes $20 million to $25 million of production start-up expense ($15 million to $20 million previously)
(3)   Includes $61 million to $66 million of ramp expense, production start-up expense, and underutilization losses ($60 million to $70 million previously)
(4)   Includes a $151 million pre-tax gain related to the sales of the North American O&M and U.S. project development businesses ($135 million to $150 million previously)
(5)   Defined as cash, cash equivalents, marketable securities, and restricted cash less expected debt at the end of 2021

Conference Call Details

First Solar has scheduled a conference call for today, April 29, 2021 at 4:30 p.m. ET, to discuss this announcement. A live webcast of this conference call and accompanying materials are available at investor.firstsolar.com.

Investors are encouraged to listen to the conference call and to review the accompanying materials, which contain more information about First Solar’s first quarter financial results and financial outlook.

An audio replay of the conference call will be available through Thursday, May 13, 2021 and can be accessed by dialing +1 (800) 585-8367 if you are calling from within the United States or +1 (416) 621-4642 if you are calling from outside the United States and entering the replay passcode 1713277. A replay of the webcast will also be available on the Investors section of First Solar’s website approximately five hours after the conclusion of the call and remain available for 90 days.

About First Solar, Inc.

First Solar is a leading American solar technology company and global provider of responsibly-produced eco-efficient solar modules advancing the fight against climate change. Developed at R&D labs in California and Ohio, the company’s advanced thin film photovoltaic (PV) modules represent the next generation of solar technologies, providing a competitive, high-performance, lower-carbon alternative to conventional crystalline silicon PV panels. From raw material sourcing and manufacturing through end-of-life module recycling, First Solar’s approach to technology embodies sustainability and a responsibility towards people and the planet. For more information, 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. All statements in this release, other than statements of historical fact, are forward-looking statements. These forward-looking statements include, but are not limited to, statements concerning: our financial guidance for 2021, net sales, gross margin, operating expenses, operating income, net income per share, earnings per share, net cash balance, capital expenditures, shipments, bookings, products and our business and financial objectives for 2021. These forward-looking statements are often characterized by the use of words such as “estimate,” “expect,” “anticipate,” “project,” “plan,” “intend,” “seek,” “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 and therefore speak only as of the date of this release. 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, whether as a result of new information, future developments or otherwise. 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 our forward-looking statements. These factors include, but are not limited to: structural imbalances in global supply and demand for PV solar modules; our competitive position and other key competitive factors; the market for renewable energy, including solar energy; the reduction, elimination, or expiration of government subsidies, policies, and support programs for solar energy projects; the impact of public policies, such as tariffs or other trade remedies imposed on solar cells and modules; interest rate fluctuations and both our and our customers’ ability to secure financing; our ability to execute on our long-term strategic plans; the loss of any of our large customers, or the ability of our customers and counterparties to perform under their contracts with us; our ability to execute on our solar module technology and cost reduction roadmaps; our ability to improve the wattage of our solar modules; the creditworthiness of our offtake counterparties and the ability of our offtake counterparties to fulfill their contractual obligations to us; the satisfaction of conditions precedent in our sales agreements; our ability to attract new customers and to develop and maintain existing customer and supplier relationships; our ability to successfully develop and complete our systems business projects; our ability to convert existing production facilities to support new product lines, such as Series 6 module manufacturing; general economic and business conditions, including those influenced by U.S., international, and geopolitical events; environmental responsibility, including with respect to cadmium telluride (“CdTe”) and other semiconductor materials; claims under our limited warranty obligations; changes in, or the failure to comply with, government regulations and environmental, health, and safety requirements; effects resulting from pending litigation; future collection and recycling costs for solar modules covered by our module collection and recycling program; our ability to protect our intellectual property; our ability to prevent and/or minimize the impact of cyber-attacks or other breaches of our information systems; our continued investment in research and development; the supply and price of components and raw materials, including CdTe; our ability to convert existing or construct production facilities to support new product lines; our ability to attract and retain key executive officers and associates; the severity and duration of the COVID-19 pandemic, including its potential impact on our business, financial condition, and results of operations; and the matters discussed under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Conditions and Results of Operations” of our most recent Annual Report on Form 10-K and our subsequently filed Quarterly Reports on Form 10-Q, as supplemented by our other filings with the Securities and Exchange Commission.

Contacts

First Solar Investors
investor@firstsolar.com

First Solar Media
media@firstsolar.com

FIRST SOLAR, INC.
CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)

		March 31, 2021				December 31, 2020
ASSETS
Current assets:
Cash and cash equivalents		$	972,879			$	1,227,002
Marketable securities (amortized cost of $562,880 and $519,844 and allowance for credit losses of $138 and $121 at March 31, 2021 and December 31, 2020, respectively)		562,735				520,066
Accounts receivable trade		795,923				269,095
Less: allowance for credit losses		(5,827		)		(3,009		)
Accounts receivable trade, net		790,096				266,086
Accounts receivable, unbilled		27,280				26,673
Less: allowance for credit losses		(276		)		(303		)
Accounts receivable, unbilled, net		27,004				26,370
Inventories		550,270				567,587
Project assets		6,984				—
Assets held for sale		—				155,685
Prepaid expenses and other current assets		226,922				251,739
Total current assets		3,136,890				3,014,535
Property, plant and equipment, net		2,397,986				2,402,285
PV solar power systems, net		236,416				243,396
Project assets		284,201				373,377
Deferred tax assets, net		106,803				104,099
Restricted marketable securities (amortized cost of $247,628 and allowance for credit losses of $13 at December 31, 2020)		—				265,280
Goodwill		14,462				14,462
Intangible assets, net		53,404				56,138
Inventories		205,096				201,229
Other assets		673,652				434,130
Total assets		$	7,108,910			$	7,108,931
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	186,087			$	183,349
Income taxes payable		15,351				14,571
Accrued expenses		217,483				310,467
Current portion of long-term debt		2,453				41,540
Deferred revenue		206,530				188,813
Liabilities held for sale		—				25,621
Other current liabilities		41,437				83,037
Total current liabilities		669,341				847,398
Accrued solar module collection and recycling liability		128,135				130,688
Long-term debt		254,447				237,691
Other liabilities		362,207				372,226
Total liabilities		1,414,130				1,588,003
Commitments and contingencies
Stockholders’ equity:
Common stock, $0.001 par value per share; 500,000,000 shares authorized; 106,310,928 and 105,980,466 shares issued and outstanding at March 31, 2021 and December 31, 2020, respectively		106				106
Additional paid-in capital		2,853,891				2,866,786
Accumulated earnings		2,925,433				2,715,762
Accumulated other comprehensive loss		(84,650		)		(61,726		)
Total stockholders’ equity		5,694,780				5,520,928
Total liabilities and stockholders’ equity		$	7,108,910			$	7,108,931

FIRST SOLAR, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
(Unaudited)

		Three Months Ended
		March 31, 2021				December 31, 2020				March 31, 2020
Net sales		$	803,374			$	609,232			$	532,124
Cost of sales		618,607				449,372				441,786
Gross profit		184,767				159,860				90,338
Operating expenses:
Selling, general and administrative		52,087				62,700				58,587
Research and development		19,873				22,670				25,613
Production start-up		11,354				16,716				4,482
Total operating expenses		83,314				102,086				88,682
Gain on sales of businesses, net		150,895				—				—
Operating income		252,348				57,774				1,656
Foreign currency loss, net		(2,595		)		(1,341		)		(398		)
Interest income		956				1,446				9,330
Interest expense, net		(2,996		)		(3,018		)		(6,789		)
Other income (expense), net		8,448				(3,279		)		(2,222		)
Income before taxes and equity in earnings		256,161				51,582				1,577
Income tax (expense) benefit		(46,490		)		66,400				89,215
Equity in earnings, net of tax		—				(2,279		)		(88		)
Net income		$	209,671			$	115,703			$	90,704
Net income per share:
Basic		$	1.98			$	1.09			$	0.86
Diluted		$	1.96			$	1.08			$	0.85
Weighted-average number of shares used in per share calculations:
Basic		106,088				105,976				105,595
Diluted		106,890				106,944				106,386

FAQ

What were First Solar's earnings for Q1 2021?

First Solar reported earnings of $1.96 per share for Q1 2021.

How much did First Solar earn in net sales for Q1 2021?

First Solar's net sales for Q1 2021 were $803 million.

What is First Solar's EPS guidance for 2021?

First Solar maintains its EPS guidance for 2021 at $4.05 to $4.75.

What was the net booking for First Solar this year?

First Solar reported year-to-date net bookings of 4.8 GWDC.

How much cash does First Solar have on hand?

First Solar has cash and cash equivalents totaling $1.8 billion.