| LDK 3/8/2011 presentation (2) |
| 送交者: eachus 2011月03月11日20:32:14 于 [世界股票论坛] 发送悄悄话 |
| 回 答: 千里马卖死驴子的价钱，你不亏，因为你不是卖家 由 eachus 于 2011-03-11 20:24:27 |
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(it's a bloomberg transcript :)
Page 3 of 6 August last year and we believe that is making very good progress. And about May or June, end of Q2, we will see the production commence in this 1 gigawatt, which will bring LDK to about 1.2 gigawatts of cell manufacturing. For the module side, today, we have 1.5 gigawatts and we are in a process of bringing it up to 2.5 gigawatts by the end of this year. So from a market perspective, I think we are ranking number one today based on this robust reports. So from a customer point of view, that we are situated globally, today in China I think accounting for about 40% of wafer shipments, primarily go through the accounts of barely – our strategy since day one has been focused on top 20 sale and module manufacturers. So companies like Trina, JA Solar, Suntech, Chinese Energy, they all among our biggest customers from China and Solarfun, of course. And from Taiwan, we have five big names: Motech, Gintech, Neo Solar Power, that's NSP, Solartech and E-Ton Solar. That's our top five accounts from Taiwan. In Japan, we have names like Sumitomo, like Sharp, like Tosera. In Korea, we have three very big names, start with Hyundai Heavy Industries, Samsung, they are coming also very aggressive and also ALG. Conservative, but they are coming in. And in Asia I think combined probably about 50% outside China and 40% from China. So about 10% of the wafers going to North America and Europe and representing company would be Q-Cells. And now Q-Cells is changing their strategy and the shipment is not as big as before. However, they are still major customers for us outside of the Asian territory. For the wafer business, we are centric in Asia area. While the modules mostly going to Europe. So certainly that Italy fit in terms of change this week, while have some impact to our business in Europe. However, our total margin percentage this year probably going to be up to about 700 to 800 megawatt. So exposure from a quantity point of view is not as big. In the same time, of course we have to find ways to allocate our production. But it's more than that, we think we have some adjustment we need to make because of this Italian change. However, we do have solutions that such as we're going to spend much more in Canada also in California where we're going to be a little bit more aggressive with the downstream project participation. We believe we're going to drive in more consumption of our own solar modules down the road. For our silicon production, we started about a year ago, that was maybe $57, $58. Today, we receive about a $38, $39 range fully loaded cost, with about $12 depreciation included. By the end of this year again we're seeing maybe $30 to $32, which we'll put LDK on the map of incumbent cost point, which we believe this business is going to have a handsome contribution of probably 50% kind of a gross margin picture for the company. For the polysilicon production today we have 11,000 and we're adding 5,000 in the larger plant and 2,000 in the smaller plant, so 7,000 additional going to be put in. And currently the production is close to 2,000 tons per quarter. This year we need to do 8,000 to 9,000, maybe up to 10,000 tons, which at today's price averages $70, we're bringing maybe $700 million contribution of revenue to the company's picture. For the module capacity, that's – we are bringing 1.5, actually almost 2.6 gigawatt this year. And for the module – for the solar cell manufacturing, we are adding one location, actually going to bring from like 200 to about 1.2 gigawatt. And I think that the progress is made quite well and we should see this solar cell increase probably in the second half of the year. And our solar module business, we are very, very globally situated, that provides all the names here. And of course that you see that we have a fairly good recovery since 2008 in every quarter, you see a fairly steady revenue growth for the company. The wafer achievement was 569, of course the Q4, we probably – we have provided guidance already. So I don't want to repeat that. And our ASP size is fairly stable and now still running about $0.85 to $0.90. And for the polysilicon production, I think that we are doing quite well, our price is very, very good, the costs are coming down as planned. So we are doing – the gross margin right now you see is 30%, but it's going to be 50% very Page 4 of 6 soon, because you can see a quarter changing from 17% to 30% and then next number you see probably going to be close to 50% and that's the power of capacity expansion. From a module shipment, we also are growing very quickly. I think Q3, we did 94, I think Q4 our guidance was about 150. So even with one year of time, we grew from 10 megawatt per quarter growth to about 150 in about six quarters. And the price as you can see was about $1.80, right now is about $1.70 to $1.75, are still fairly stable and we expect that price going to be sustained through Q2. For the total revenue that you can see that was about $700 million in Q3. I think Q4, you probably look at the high 800s may be close to $900 million for Q4 and for profit also you can see that quarter-by-quarter, very consistent growth, quarter-by-quarter. So that's probably the summary of my presentation. We can leave a few minutes for Q&As. Q&A <A>: Okay, anyone want to start it off? <Q>: [Question Inaudible] <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: Normally, we look at polysilicon price in a 10-year period. So for instance, LDK, we buy polysilicon because our consumption for polysilicon this year 3-gigawatt will be 18,000 tons. We only produce 10,000 tons. We sell 5,000 tons. So we buy 13,000 tons. So first of all, if we go out to buy a 10-year contract, normally we pay about $55 to $65. So that's a long-term price. However, you look at the short-term price, in Q3 we were selling at $62, in Q4, we were selling at $70. In Q1, I think we are selling at $80, but today we're selling at more than $80. And those dollars so-called are almost like a spot market price. But today, spot market could be as high as $100. So normally it's $40 or $100, our long-term price is assumed at the range of say, $55 and $65. So let's say the midpoint is $60. So our objective is to get cost point for low the manufacturing cost close to say is $30 to $32. So on a $30 cost point, with $60 long-term pricing, that's where we developed this 50% gross contribution, as compared to wafer contribution, today, it will be about 30% to 32%. And as far as the module contribution, it will be about say 10% or maybe 15% if we do quite well. So from a business that we have 50% in upstream, 30% in the midstream and probably 10% to 15% in the downstream. On a mixed gross margin basis, LDK's model such as that our gross margin will be somewhere between 25 to 28. And if you talk to Jeff, Jeff will say 23. So our range is 25 to 28. But - <Q>: I see some room to beat my numbers. <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: Yes, sir. <Q>: You were talking about the wafer costs, you broke it out between poly and what happens after that, can you – it was $0.31 for the poly and $0.32 for everything else. Can you just break out that $0.32, where does [inaudible] come from? <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: Okay, let's start with the polysilicon cost, because it is very simple. It takes about 6 grams to do a watt, so 6 grams. So let's say, if we produce 100% using the ingot silicon today, it will be, say $40, so about $0.24. And though we really have to use fine silicon at $60, so $60 times say six gram, that would be $0.36. So we are somewhere like $0.30. So the other $0.30 or whatever for non-silicon cost is primarily coming from crucible. The crucible is the box that is holding the silicon like Ceradyne in Costa Mesa, California. That's an American company and the Versuvius in France. They are the two major manufacturers for that. 450 kilo oil, today we have 600 kilo and 800 kilo ingots. So very big boxes. That's very, very important for the ingot manufacturing. And also the wire-saw the wires also very, very important material. And also the slurry, the slurry that Page 5 of 6 put into the wire-saw machines which cut the wafers, cut the ingot to be block and block into wafers, and that is also very important. And labor is very, very small. Although many questions about Chinese inflation of our labor cost, I believe it's about 16% per year, and we do take 25% better than the Chinese company. We are foreign invested enterprise. So we pay about 20%, 25% over the market. While we provide probably 15% to 20% pay raise, so inflation is high. However, the cost of the labor is only 1.5 to 3, and the electricity cost in manufacturing of wafer is not that big, maybe 3%, 4%. <Q>: Okay but the reason I asked the question is I heard you say the wafering you're cutting is maybe $0.20 to $0.22 <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: Yeah, I think that I probably agree with you. You go back five years ago, went to our facility just like any other facilities in the world that the ingot size was 250 kilogram. And at that time, probably cost very high. For the same amount – maybe similar amount of electricity and the process time, today, we produce almost the smallest ingot, 450 kilogram, and also 600. We are the first company to produce 600 kilogram ingots. Today, we are capable of making 800 kilograms. So once you have the similar 70 hours to produce and use the same amount of electricity then the cost is much lower. And also the yield is much better. So that helps to reduce the cost by more than 50% over the last five years. <Q>: [Question Inaudible] <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: Well, I don't have that breakdown, but if you like to do that, I'll be very happy to have you talk to my controller and he has all these details. <Q>: And is this the same for mono versus poly? <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: The mono we are very, very small. I think only 10% or maybe 300 megawatt versus 2.7 gigawatt. And I think the statistic is still not very mature, we are very new, less than one year in the mono. So maybe another two, three quarters, we can provide a little more color for our mono business. And the mono is very strategic for high efficiency, for specific customers like [inaudible], like SunPower. And the price is not ready up to to that. And you certainly need to have very high quality, high efficiency. So it's a different type of ballgame that you need to dedicate a little bit more effort to produce high quality, high efficiency and for a system that require limited space applications. Yes, sir. <Q>: [Question Inaudible] <A - Jack Lai, Executive Vice President, Chief Financial Officer and Secretary>: First of all, that I don't know my peers from China. But from an equipment point of view, for our large plant, 15,000 is almost 100% GT Solar, so it's American. And for our smaller plant is 100% MSA, that's German. We are a China-based company although most of our equipment, they are imported from the U.S. and from Europe. And most of our people – people running our factory, all coming from all incumbent players. And they have been on the job for 20, 30 years. So I don't think they have experience of running the Chinese equipment. Now for me, I have zero experience for that. So we are very much – and our budgeted CapEx for polysilicon plant, say for American is $120. We also managed by floor, so it's totally American. So it's American building a Chinese plant, using American equipment, use American managers and people from America and also probably Europe to run the factory. So our cost, I think, definitely will be higher in terms of investment. However, the quality, the productivity, and I'm very confident that when you have a chance and you go to make some comparisons that you probably can see we have American peers that you can go to have a tour, not so far from here, maybe a couple of hours, and once you have a tour, we use that company in the U.S. then you go to see my factory and also you can see a couple of hours away from my factory, you see the Chinese peers. You see their factory from appearance, then you see the product coming off from production line, then you probably know some differences. And also you probably can visualize the product and also to compare the ASP. When we report ASP for Q4 – when we report our ASP for Q4, you will see why the ASP is so much different. So I think it's different people, different equipment, different process, different management and different products. That's all I can tell you. Page 6 of 6 Analyst, Kaufman Brothers LP Okay. Thank you, Jack. Jack Lai, Executive Vice President, Chief Financial Officer and Secretary Thank you it's a bloomberg transcript :) |
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