August 28, 2014

Hanwha SolarOne Reports Second Quarter 2014 Results

SHANGHAI, Aug. 28, 2014 /PRNewswire/ -- Hanwha SolarOne Co., Ltd. ( "SolarOne" or the "Company") (Nasdaq: HSOL), a vertically integrated manufacturer of silicon ingots, wafers and photovoltaic ("PV") cells and modules in China, today reported its unaudited financial results for the three months ended June 30, 2014. The Company will host a conference call to discuss the results at 8:00 am Eastern Time (8:00 pm Shanghai Time) on August 28, 2014.  A slide presentation with details of the results will also be available on the Company's website prior to the call.   

SECOND QUARTER 2014 HIGHLIGHTS


1Q14

2Q14

Percentage Change1

(RMB)

(US$)

(RMB)

(US$)

(%)

Net Revenues (Million)

1,138.4


183.1

1,107.3

178.5

-2.7

Shipments (MW)

323.6

339.5

+4.9

Average Selling Price (/W)

4.27


0.69

4.17

0.67

-2.3

Gross profit (Million)

158.1


25.4

105.1

16.9

-33.5

Gross margin (%)

13.9

9.5

-440 basis points

Operating (loss)/profit (Million)

21.9


3.5

(39.9)

(6.4)

N/M

Operating margin (%)

1.9

-3.6

-550 basis points

Net loss (Million)

(133.4)


(21.5)

(54.8)

(8.8)

Reduced 58.9

Net loss per basic ADS

(1.47)


(0.24)

(0.60)

(0.10)

Reduced 59.2

 

1 Percentage changes are calculated based on RMB amounts to eliminate fluctuations in the exchange rate of the dollar.

Mr. Seong-woo Nam, Chairman and CEO of Hanwha SolarOne commented, "The second quarter of 2014 showed an increase in shipments and a significant reduction in our net loss position. Our gross margins were driven down by a lower average selling price, reflecting a decreasing proportion of sales from the higher-priced EU market, particularly the UK, and an increasing proportion from the relatively lower priced China market. We maintained our strong position in Japan and began shipments to several newer emerging markets. We continued to maintain tight control over operating expenses."

Chairman Nam noted, " We see a number of positive developments for our business for the remainder of this year, including 1) strong growth in quarterly shipment volumes beginning in the third quarter, driven especially by good visibility in China 2) opportunities for cost reduction due to increased efficiency and improved utilization for our ingot and wafer manufacturing lines, 3) the introduction of new four busbar cell technology, 4) reduced processing costs from decreased use of raw materials 5) increased automation of our production lines and 6) the addition of new cell and module lines. Module manufacturers continue to compete intensely on price and we expect to continue to see decreasing average selling prices near term that make gross margin expansion challenging in the near term."

SECOND QUARTER 2014 RESULTS

  • Total net revenues were RMB1, 107.3 million (US$178.5 million), a decrease of 2.7% from RMB1,138.4 million in 1Q14, and a decrease of 6.4% from RMB1,182.8 million in 2Q13. The decrease in total net revenues in 2Q14 compared with 1Q14 was primarily due to a lower average selling price. Module processing services accounted for approximately 13% of revenues.
  • PV module shipments, including module processing services, were 339.5 MW, a 4.9% increase from 323.6 MW in 1Q14, and a 5.7% increase from 321.2 MW in 2Q13.

Module revenue by shipping destination 2Q 14    Module revenue by shipping destination 1Q 14

Country

2Q14



Country

1Q14

Japan

53%



Japan

51%

US

11%



UK

22%

UK

9%



US

8%

Korea

9%



Korea

7%

Canada

7%



India

3%

China

6%



Canada

3%

Turkey

1%



Guatemala

2%

Others

4%



Others

4%

  • The Company once again maintained a strong presence in Japan, representing 53% of module shipments worldwide in 2Q14. The US reversed its position with the UK from the prior quarter to become the second largest market for the Company in the three months ended June 30, 2014. The UK market declined this quarter to account for 9% of total shipments, due to lower demand for utility-scale solar projects after a change in the incentive scheme. Deliveries to Korea and Canada picked up for the Company at 9%, and 7% for this quarter, respectively. This quarter we saw a meaningful rebound in shipments to the China market, representing 6% of the 339.5 MW of modules shipped. We continue to see momentum building in the China market and expect strong demand in the second half of the year. The Company continues to penetrate new emerging markets, with Turkey being the Company's newest market. The Company increased the shipment of PV modules to 23 countries during 2Q14, including a number of notable new markets. Shipments to Europe and Africa (EA) contributed 12% to total module shipments, Asia Pacific (AP) accounted for 70% and North America (NA) 18%.
  • The average selling price of modules, excluding module processing services, decreased to RMB4.17 per watt (US$0.67), from RMB4.27 per watt in 1Q14 and increased from RMB4.03 per watt in 2Q13. This is primarily attributable to a greater percentage of business in China which is a lower price market and to a decline in volume to the UK which is comparatively a higher priced market.
  • Gross profit in 2Q14 was RMB105.1 million (US$16.9 million), compared with a gross profit of RMB158.1 million in 1Q14 and a gross profit of RMB65.3 million in 2Q13. The decrease in gross profit in 2Q14 was primarily due to lower revenues due to declining average selling price.
  • Gross margin was positive 9.5%, compared with positive 13.9% in 1Q14 and positive 5.5% in 2Q13.
  • The blended cost of goods sold ("COGS") per watt, excluding module processing services, was US$0.59, representing no change from 1Q14. The blended COGS takes into account the production cost (silicon and non-silicon) using internally sourced wafers, and purchase costs and additional processing costs of externally sourced wafers and cells.
  • Operating loss in 2Q14 was RMB39.9 million (US$6.4 million), compared with an operating profit of RMB21.9 million in 1Q14 and an operating loss of RMB122.1 million in 2Q13. Operating margin decreased to negative 3.6% from positive 1.9% in 1Q14 and increased from negative 10.3% in 2Q13.
  • Operating expenses as a percentage of total net revenues were 13.1% in 2Q14, compared with 12.0% in 1Q14 and 15.8% in 2Q13. The Company continues to maintain tight operating expense control.
  • Interest expense was RMB88.4 million (US$14.2 million), compared with RMB89.0 million in 1Q14 and RMB73.3 million in 2Q13. 
  • The Company recorded a net gain of RMB37.3 million (US$6.0 million), which included a foreign exchange gain and a loss from the change in fair value of derivatives in hedging activities. The Company recorded a net loss of RMB72.7 million in 1Q14 and a net gain of RMB47.2 million in 2Q13 for the foreign exchange gain/loss and the gain/loss from change in fair value of derivatives in hedging activities.
  • Gain from the change in fair value of the conversion feature of the Company's convertible bonds was RMB3.4 million (US$0.6 million), compared with a loss of RMB0.3 million in 1Q14 and a loss of RMB11.3million in 2Q13. This line item has fluctuated, and is expected to continue to fluctuate quarter-to-quarter, primarily based on changes in the Company's ADS price. The Company has no direct control over the fluctuations.
  • Net loss attributable to shareholders on a non-GAAP basis[1] was RMB54.0 million (US$8.7 million), compared with a net loss attributable to shareholders of RMB98.8 million in 1Q14 and a net loss attributable to shareholders of RMB130.0 million in 2Q13.
  • Net loss per basic ADS on a non-GAAP basis was RMB0.59 (US$0.10), compared with net loss per basic ADS on a non-GAAP basis of RMB1.09 in 1Q14 and net loss per basic ADS on a non-GAAP basis of RMB1.54 in 2Q13. 
  • Net loss attributable to shareholders on a GAAP basis was RMB54.8 million (US$8.8 million), compared with net loss attributable to shareholders of RMB133.4 million in 1Q14 and net loss attributable to shareholders of RMB166.0 million in 2Q13.
  • Net loss per basic ADS on a GAAP basis was RMB0.60 (US$0.10), compared with net loss per basic ADS of RMB1.47 in 1Q14 and net loss per basic ADS of RMB1.96 in 2Q13.
  • Annualized ROE on a non-GAAP basis was negative 13.6% in 2Q14, compared with negative 24.6% in 1Q14 and negative 25.1% in 2Q13.
  • Annualized ROE on a GAAP basis was negative 11.9% in 2Q14, compared with negative 28.4% in 1Q14 and negative 27.2% in 2Q13.  

[1] All non-GAAP numbers used in this press release exclude the accounting impact from the adoption of ASC 815-40, which relates to the accounting treatment for the convertible bonds.  Please refer to the attached financial statements for the reconciliation between the GAAP and non-GAAP financial results.

FINANCIAL POSITION

As of June 30 2014, the Company had cash and cash equivalents of RMB981.5 million (US$158.2 million) and net working capital of negative RMB1,204.7 million (US$194.2 million), compared with cash and cash equivalents of RMB1,078.6 million and net working capital of RMB140.1 million as of March 31, 2014. The decline in net working capital results from the reclassification of a term loan from a long term to a short term liability. Total short-term bank borrowings (including the current portion of long-term bank borrowings) were RMB2, 918.8 million (US$470.5 million) as of June 30, 2014, compared with RMB1, 519.5 million as of March 31, 2014. As of June 30, 2014 the Company's convertible bonds were classified as a current liability and totaled RMB462.1 million (US$74.5 million). Holders of the convertible bonds have the option to require the Company to redeem the notes on January 15, 2015. The Company has from time to time been buying back its convertible bonds since January 1, 2012. The Company has repurchased convertible bonds to the value of approximately US$86.4 million out of US$172.5 million in face value as of June 30, 2014. As of June 30, 2014, the Company had total long-term debt of RMB1, 619.4 million (US$261.0 million), which is comprised of long-term bank borrowings and long-term notes. The Company's long-term bank borrowings are to be repaid in installments until their maturities ranging from 1 to 3 years. The Company's long-term notes are to be repaid in 2 years. 

Net cash provided in operating activities in 2Q14 was RMB130.6 million (US$21.0 million), compared with net cash used in operating activities of RMB209.5 million in 1Q14 and net cash provided in operating activities of RMB497.7 million in 2Q13. As of June 30, 2014, accounts receivable were RMB641.0 million (US$103.3 million), compared with RMB824.5 million as of March 31, 2014 and RMB1, 163.6 million as of June 30, 2013.  Days sales outstanding ("DSO") were unchanged in 2Q14 from 1Q14 at 116 days in and decreased from 124 days in 2Q13. As of June 30, 2014, inventories increased to RMB852.9 million (US$137.5 million) from RMB779.6 million as of March 31, 2014 and RMB686.6 million as of June 30, 2013. Day's inventory was 73 days in 2Q14 compared with 70 days in 1Q14 and 59 days in 2Q13.

Capital expenditures were RMB84.6 million (US$13.6 million) in 2Q14. 

CAPACITY STATUS

As of June 30, 2014, the Company had production capacity of 800 MW for ingot and wafer, 1.3 GW for cell and 1.5 GW for module. The Company is aiming to expand cell and module capacities to at least 1.5 GW and 2.0 GW, respectively, by the end of 2014.

 BUSINESS OUTLOOK

The Company provides the following guidance based on current operating trends and market conditions.

For the third quarter 2014 the Company expects:

  • Module shipments of approximately 400MW

For the full year 2014, the Company expects:

  • Module shipments between 1.5 - 1.6 GW of which about 25-30% will be for PV module processing services
  • Capital expenditures of $80 million largely for automation of existing manufacturing lines, as well as, cell module capacity expansions to at least 1.5 GW and 2.0 GW respectively

CONFERENCE CALL

The Company will host a conference call to discuss the second quarter results at 8:00 AM Eastern Time (8:00 PM Shanghai Time) on August 28, 2014.

Mr. Seong-woo Nam, Chairman and CEO; Mr. Jung Pyo SEO, Chief Financial Officer; and Mr. Paul Combs, Vice President of Investor Relations, will discuss the results and take questions following the prepared remarks. 

The dial-in details for the live conference call are as follows:

- U.S. Toll Free Number:                                 

18665194004

- International dial-in Number:                          

+65 67239381

- China Toll Free Numbers:                              

4006208038


8008190121

Passcode: HSOL


A live webcast of the conference call will be available on the investor relations section of the Company's website at: http://www.hanwha-solarone.com. A replay of the webcast will be available for one month.

A telephone replay of the call will be available for seven days after the conclusion of the conference call. The dial-in details for the replay are as follows:

- U.S. Toll Free Number:                                     

18554525696

- International dial-in Number:                                  

+61 2 8199 0299

- China Domestic Toll Free Numbers:                      

4006022065 (Mandarin)


8008700205

Conference ID 84707308


Encore Dates: 28/08/2014 11:00 ET - 05/09/2014 09:59 ET

FOREIGN CURRENCY CONVERSION

The conversion in this release of Renminbi into U.S. dollars is made solely for the convenience of the reader, and is based on the exchange rate as set forth in the H.10 statistical release of the Federal Reserve Board as of June 30, 2014, which was RMB6.2036 to US$1.00, except for the conversion of Renminbi into U.S. dollars for 1Q14 which is based on the exchange rate of RMB6.2164 to US$1.00 as set forth in the H.10 statistical release of the Federal Reserve Board as of March 31, 2014 and the conversion of Renminbi into U.S. dollars for 2Q13 which is based on the exchange rate of RMB6.1374 to US$1.00 as set forth in the H.10 statistical release of the Federal Reserve Board as of June 28, 2013 . 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 on June 30, 2014 or at any other date. Percentage changes stated in this press release are calculated based on Renminbi amounts.  

USE OF NON-GAAP FINANCIAL MEASURES

The Company has included in this press release certain non-GAAP financial measures, including certain line items presented on the basis that the accounting impact of ASC 815-40 had not been recorded.  The Company believes that both management and investors benefit from referring to these non-GAAP financial measures in assessing the performance of the Company and when planning and forecasting future periods. Readers are cautioned not to view non-GAAP financial measures on a stand-alone basis or as a substitute for GAAP measures, or as being comparable to results reported or forecasted by other companies, and should refer to the reconciliation of GAAP measures with non-GAAP measures also included herein.

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 include 3Q and full-year 2014 estimates for PV product shipments, production capacities and other results of operations. Forward-looking statements involve inherent risks and uncertainties and actual results may differ materially from such estimates depending on future events and other changes in business climate and market conditions.  Hanwha SolarOne disclaims any obligation to update or correct any forward-looking statements.

About Hanwha SolarOne

Hanwha SolarOne Co., Ltd. (NASDAQ: HSOL) is a vertically-integrated manufacturer of silicon ingots, wafers, PV cells and modules. Hanwha SolarOne offers high-quality, reliable products and services at competitive prices. Partnering with third-party distributors, OEM manufacturers, and systems integrators, Hanwha SolarOne serves the utility, commercial, government, and residential markets. The Company maintains a strong presence worldwide, with employees located throughout Europe, North America and Asia, and embraces environmental responsibility and sustainability, with an active role in the voluntary photovoltaic recycling program. Hanwha Group, Hanwha SolarOne's largest shareholder, is active in solar project development and financing, and the production of polysilicon. For more information, please visit: http://www.hanwha-solarone.com.

 

Hanwha SolarOne Co., Ltd.

CONSOLIDATED BALANCE SHEETS

(Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("US$")












June 30

March 31

June 30

June 30


2013

2014

2014

2014


(Unaudited)

(Unaudited)

 (Unaudited) 

(Unaudited)


 RMB'000 

 RMB'000 

 RMB'000 

US$'000

ASSETS





Current assets





Cash and cash equivalents

1,418,559

1,078,644

981,490

158,213

Restricted cash

116,171

239,361

434,943

70,111

Derivative contracts

4,050

-

-

-

Accounts receivable - net

1,163,606

824,512

640,962

103,321

Notes receivable

50

10,490

7,437

1,199

Inventories - net

686,570

779,604

852,947

137,492

Advance to suppliers - net

181,160

167,870

202,213

32,596

Other current assets - net

295,363

258,363

250,772

40,424

Deferred tax assets - net

136,205

-

-

-

Amount due from related parties - net

347,379

589,477

562,483

90,671






    Total current assets

4,349,113

3,948,321

3,933,247

634,027






Non-current assets





Fixed assets - net

4,655,408

4,387,922

4,359,730

702,774

Intangible assets - net

275,390

270,946

269,546

43,450

Deferred tax assets - net

127,209

2,946

2,946

475

Long-term deferred expenses

17,415

6,557

4,247

685

Long-term prepayments

154,278

118,124

75,322

12,142






    Total non-current assets

5,229,700

4,786,495

4,711,791

759,526






TOTAL ASSETS

9,578,813

8,734,816

8,645,038

1,393,553






LIABILITIES





Current liabilities





Derivative contracts

11,141

17,489

17,659

2,847

Short-term bank borrowings

1,063,858

1,283,269

1,343,676

216,596

Long-term bank borrowings, current portion

111,217

236,241

1,575,117

253,904

Convertible bonds

-

509,249

462,126

74,493

Accounts payable

1,139,431

624,270

522,806

84,275

Notes payable

422,275

363,740

465,800

75,085

Accrued expenses and other liabilities

413,730

341,269

361,661

58,299

Customer deposits

51,531

34,637

34,492

5,560

Unrecognized tax benefit

143,473

143,473

116,089

18,713

Amount due to related parties

121,158

254,629

238,529

38,449






    Total current liabilities

3,477,814

3,808,266

5,137,955

828,221






Non-current liabilities





Long-term bank borrowings

2,632,126

2,369,789

1,004,137

161,864

Long-term notes

617,870

615,210

615,280

99,181

Convertible bonds

421,018

-

-

-

Long term payable

50,000

50,000

50,000

8,060

Deferred tax liabilities

24,504

24,062

23,914

3,855






    Total non-current liabilities

3,745,518

3,059,061

1,693,331

272,960






TOTAL LIABILITIES

7,223,332

6,867,327

6,831,286

1,101,181






Redeemable ordinary shares

24

24

24

4






EQUITY





Shareholders' equity





Ordinary shares

316

337

337

54

Additional paid-in capital

4,005,732

4,126,818

4,127,259

665,301

Statutory reserves

174,456

174,456

174,456

28,122

Accumulated deficits

(1,822,340)

(2,437,931)

(2,492,720)

(401,818)

Accumulated other comprehensive income (loss)

(2,707)

3,785

4,396

709






    Total shareholders' equity

2,355,457

1,867,465

1,813,728

292,368






TOTAL EQUITY

2,355,481

1,867,489

1,813,752

292,372






TOTAL LIABILITIES, REDEEMABLE ORDINARY SHARES AND SHAREHOLDERS' EQUITY

9,578,813

8,734,816

8,645,038

1,393,553

 

Hanwha SolarOne Co., Ltd.

CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("US$"),

except for number of shares (ADS) and per share (ADS) data







For the three months ended


 June 30 

 March 31 

 June 30 

 June 30 


2013

2014

2014

2014


(Unaudited)

(Unaudited)

 (Unaudited) 

(Unaudited)


RMB'000

RMB'000

 RMB'000 

US$'000






Net revenues

1,182,799

1,138,426

1,107,253

178,485






Cost of revenues

(1,117,479)

(980,340)

(1,002,182)

(161,548)


---------------

---------------

---------------

---------------

Gross profit 

65,320

158,086

105,071

16,937






Operating expenses





Selling expenses

(95,466)

(52,772)

(62,952)

(10,148)

General and administrative expenses

(69,422)

(62,600)

(63,925)

(10,304)

Research and development expenses

(22,573)

(20,822)

(18,053)

(2,910)


---------------

 

---------------

---------------

---------------

    Total operating expenses

(187,461)

(136,194)

(144,930)

(23,362)


--------------

---------------

---------------

---------------

Operating loss

(122,141)

21,892

(39,859)

(6,425)






Interest expenses

(73,321)

(88,966)

(88,370)

(14,245)

Interest income

6,123

6,511

11,956

1,927

Exchange gain

36,709

(44,718)

39,569

6,379

Changes in fair value of derivative contracts

10,491

(27,978)

(2,226)

(359)

Changes in fair value of conversion feature of convertible bonds

(11,253)

(311)

3,427

552

Loss on extinguishment of debt

-

-

(9,939)

(1,602)

Other income

1,616

2,540

2,066

333

Other expenses

(11,148)

(2,906)

(2,382)

(384)


---------------

---------------

---------------

---------------

Net loss before income tax

(162,924)

(133,936)

(85,758)

(13,824)






Income tax benefit (expenses)

(3,070)

528

30,969

4,992


---------------

---------------

---------------

---------------

Net loss

(165,994)

(133,408)

(54,789)

(8,832)


---------------

---------------

---------------

---------------

Net loss attributable





to shareholders

(165,994)

(133,408)

(54,789)

(8,832)






Other comprehensive income (loss), net of tax





Foreign currency translation adjustment

(879)

5,815

611

98






Comprehensive loss atributable to ordinary shareholders






Net loss per share





Basic

(0.39)

(0.29)

(0.12)

(0.02)

Diluted

(0.39)

(0.29)

(0.12)

(0.02)






Shares used in computation





Basic

423,111,372

454,560,163

457,277,047

457,277,047

Diluted

423,111,372

454,560,163

457,277,047

457,277,047











Net loss per ADS





Basic

(1.96)

(1.47)

(0.60)

(0.10)

Diluted

(1.96)

(1.47)

(0.60)

(0.10)






ADSs used in computation





Basic

84,622,274

90,912,033

91,455,409

91,455,409

Diluted

84,622,274

90,912,033

91,455,409

91,455,409

 

Hanwha SolarOne Co., Ltd.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Amounts in thousands of Renminbi ("RMB") and U.S. dollars ("US$")










For the three months ended





June 30, 2013

March 31, 2014

June 30, 2014

June 30, 2014





 (Unaudited) 

 (Unaudited) 

 (Unaudited) 

 (Unaudited) 





 RMB'000 

 RMB'000 

 RMB'000 

US$'000









Cash flow from operating activities                                            





    Net loss

(165,994)

(133,408)

(54,789)

(8,832)









    Adjustments to reconcile net loss to net cash





          provided by (used in) operating activities:





          Unrealised loss from derivative contracts

3,266

37,608

170

27

          Amortization of convertible bonds discount

19,171

38,581

31,752

5,118

          Changes in fair value of conversion feature of convertible bonds

11,253

311

(3,427)

(552)

          Loss on extinguishment of debt

-

-

9,939

1,602

          Loss from disposal of fixed assets

7,394

127

43

7

          Depreciation and amortization

108,209

110,024

109,492

17,650

          Amortization of long-term deferred expenses

8,409

3,210

4,411

711

          Reversal of doubtful debt for amount due from related parties

(7,980)

-

-

-

          Write down of inventories

37,043

8,858

7,911

1,275

          Stock compensation expense

1,093

320

441

71

          Warranty provision / utilization

10,875

(16,428)

5,457

880

          Warranty reversal

(2,918)

(6,177)

(2,957)

(477)

          Deferred tax benefit (expense)

1,360

(147)

(148)

(24)

          Foreign currency exchange gains (losses)

(9,951)

5,520

70

11

          Reversal of unrecognized tax benefit

-

-

(27,384)

(4,414)

    Changes in operating assets and liabilities





          Restricted cash

(23,970)

(34,190)

(128,243)

(20,672)

          Inventories

53,252

(36,171)

(81,254)

(13,098)

          Accounts and notes receivable

(32,392)

(73,668)

187,214

30,178

          Advance to suppliers and long-term prepayments

15,396

28,146

8,459

1,364

          Long-term deferred expenses

(505)

-

-

-

          Intangible assets

56,335

-

-

-

          Other current assets

(23,719)

46,546

16,557

2,669

          Amount due from related parties

79,399

(58,745)

26,994

4,351

          Accounts and notes payable

333,477

(182,531)

5,243

845

          Accrued expenses and other liabilities

56,829

(24,873)

24,642

3,972

          Customer deposits

24,536

(13,126)

(145)

(23)

          Amount due to related parties

(62,161)

9,712

(9,893)

(1,594)

          Long-term payable


-

-

-









Net cash provided by (used in) operating activities

497,707

(290,501)

130,555

21,045

















Cash flows from investing activities





          Acquisition of fixed assets

(60,505)

(31,570)

(84,643)

(13,643)

         Disposal of fixed assets

2,497

388

-

-

         Change of restricted cash

4,550

4,504

(71,070)

(11,456)









Net cash used in investing activities

(53,458)

(26,678)

(155,713)

(25,099)

















Cash flows from financing activities





         Proceeds from issuance of ordinary shares


104,367

-

-

         Payment for repurchase of convertible bonds

-

-

(84,999)

(13,702)

         Change of restricted cash

64,898

(45,727)

3,731

601

         Proceeds from short-term borrowings

374,417

913,419

464,637

74,898

         Proceeds from long-term borrowings

617,970

-

-

-

         Payment of short term borrowings

(589,871)

(748,029)

(410,384)

(66,153)

         Payment for long term borrowings

(484,715)

(74,167)

(26,776)

(4,316)

         Arrangement fee and other related costs for long-term
         bank borrowings

 

(6,793)

 

-

 

(6,750)

 

(1,088)

         Arrangement fee and other related costs for long-term notes

(3,721)

-

(3,695)

(596)

         Arrangement fee and other related costs for short-term bank
         borrowings

 

(2,829)

 

(3,521)

 

(7,760)

 

(1,251)

 









Net cash provided by (used in) financing activities

(30,644)

146,342

(71,996)

(11,607)









Net increase (decrease) in cash and cash equivalents

413,605

(170,837)

(97,154)

(15,661)









Cash and cash equivalents at the beginning of period

1,004,954

1,249,481

1,078,644

173,874









Cash and cash equivalents at the end of period

1,418,559

1,078,644

981,490

158,213

















Supplemental disclosure of cash flow information:





          Interest paid

29,838

42,749

39,947

6,439

          Income tax paid (refunded)

(18,728)

(932)

1,592

257

          Realized gain (loss) from derivative contracts

13,757

9,630

(2,056)

(332)

Supplemental schedule of non-cash activities:





          Acquisition of fixed assets included in accounts payable,
          accrued expenses and other liabilities

(16,710)

(17,263)

(4,700)

(758)


For the three months ended





June 30, 2013

March 31, 2014

June 30, 2014

June 30, 2014





(RMB million)

(RMB million)

(RMB million)

(US$ milllion)












Non-GAAP net loss

(130.0)

(98.8)

(54.0)

(8.7)












Fair value changes of the conversion features of the Convertible bonds

(11.3)

(0.3)

3.4

0.6












Accretion of interest of the Convertible bonds

(24.7)

(34.3)

(31.6)

(5.1)












Unrecognized tax benefit

-

-

27.4

4.4










GAAP net loss

(166.0)

(133.4)

(54.8)

(8.8)

























For the three months ended





June 30, 2013

March 31, 2014

June 30, 2014

June 30, 2014





(RMB)

(RMB)

(RMB)

(US$)












Non GAAP net loss per ADS - Basic

(1.54)

(1.09)

(0.59)

(0.10)












Fair value changes of the conversion features of the Convertible bonds

(0.13)

-

0.04

0.03












Accretion of interest of the Convertible bonds

(0.29)

(0.38)

(0.35)

(0.07)












Unrecognized tax benefit

-

-

0.30

0.04








GAAP net loss contributed to shareholders per ADS - Basic

(1.96)

(1.47)

(0.60)

(0.10)










ADS (Basic)

84,622,274

90,912,033

91,455,409

91,455,409





















For three months ended


Annualized for the three months ended


June 30, 2013

March 31, 2014

June 30, 2014


June 30, 2013

March 31, 2014

June 30, 2014









Non-GAAP Return on Equity 

-6.27%

-6.16%

-3.41%


-25.08%

-24.64%

-13.64%









Fair value changes of the conversion features of the Convertible bonds

0.47%

0.89%

0.66%


1.88%

3.56%

2.64%









Accretion of interest of the Convertible bonds

-1.01%

-1.83%

-1.72%


-4.04%

-7.32%

-6.88%









Unrecognized tax benefit

-

-

1.49%


-

-

5.96%









GAAP Return on equity

-6.81%

-7.10%

-2.98%


-27.24%

-28.40%

-11.92%

SOURCE Hanwha SolarOne Co., Ltd.

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