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CSIQ 2014Q1 ER

CSIQ

225 replies to this topic

#1 sunnysky

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Posted 15 April 2014 - 06:30 PM

Here is my estimate:

 

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

Net Rev (K$):                 $420,000

       Module Rev:            $324,300

       Project Rev:            $  95,700

       % Proj Rev:                     23%

 

Cost of Rev:                   $336,804

Gross Profit:                   $  83,196   (compared with 101,256 of Q4)

GM:                                    19.81% 

 

Opex:                              $  45,427

Income from Ops:          $  37,769

 

Interest and Adjs:            $  11,171   (including FX loss of $4 M but 0 warrants gain - haven't estimated.)

Income before Tax:         $  26,598

 

Tax:                                 $    3,387

Net Income:                     $  23,212   (compared with 24,055 of Q4)

 

Less non-controlling:       $    2,447

Net Income CSIQ:           $   20,769  (compared with 20,947 of Q4)

 

Shares used:                     56,095K    

 

EPS:                                         0.37  (compared with 0.39 of Q4)

Average analyst estimate:        0.12

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

 

Note: I hope they do better with FX this time. The # of shares is a variable. Fair value of warrants will affect non-GAAP EPS.

 

Anyone else would like to share estimates?

 

 

Edit:  I estimated 

                 Fair value of warrants in excess of net proceeds of equity offering  = $37.3 M

                 Gain from warrants from the offering closing date to the end of Q1 = $14.8 M

         so the total loss from warrants was $22.5 M.

 

         The GAAP EPS estimate is then -0.03 but non-GAAP EPs remains unchanged at 0.37.

 

         Note: Fair value of shares in excess of net proceeds of equity offering was $10.4 M, which I did not include.


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#2 hellosolar

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Posted 15 April 2014 - 06:52 PM

I just want to add that it is possible that ldk case maybe will affect eps.
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#3 sunnysky

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Posted 15 April 2014 - 07:06 PM

Yes sure, that is a good point. My estimate does not include one timers such as law suit settlements, write-offs, or bad debt provisioning. 


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#4 odyd

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Posted 15 April 2014 - 08:11 PM

"Management's expectations in respect to profitability in the fourth quarter and the fiscal year 2013 are subject to the final ruling by the Suzhou Intermediate Court on a contract dispute between Canadian Solar and LDK as previously disclosed. If the court was to rule against Canadian Solar and order the Company to pay the award to LDK, before the company files its Annual Report on Form 20-F in April of 2014, Canadian Solar may have to make a provision for the fourth quarter of 2013 and the full year of 2013, which would impact the Company's profitability."

 

I suppose if they file, it will affect the Q1, if this happens before filling they will sweep it under Q4 results.


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#5 sunnysky

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Posted 15 April 2014 - 08:49 PM

Thanks, that is good to know. They could file any time now. 


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#6 odyd

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Posted 15 April 2014 - 08:55 PM

The one thing, which continue to bother me is the presentation's 14 to 16% GM for Q1, including projects business. We discussed this with the sale of Little Creek, assuming not being part of that GM prediction. It would be brilliant if they came out to say this, adding couple of points.


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#7 odyd

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Posted 15 April 2014 - 09:04 PM

This is a quote from Hanwha's 20-F about arbitration with LDK,  since LDK is folding its sails, perhaps CSIQ could settle with them in the fashion as below:

In
"December, 2013, we reached a settlement agreement with LDK, which was recognized by the Shanghai Arbitration Commission and became
effective in January 2014. According to the settlement agreement, LDK agrees to fully and irrevocably withdraw their arbitration claim in the
amount of RMB446 million and refrain from bringing any future claims based on that long-term supply agreement, and in return, we agree to
waive the right to seek enforcement of the arbitral award in the amount of RMB104.5 million. See “Item 8. Financial Information—
A. Consolidated Statements and Other Financial Information—Legal & Administrative Proceedings”.
 


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#8 hellosolar

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Posted 15 April 2014 - 09:11 PM

That means 40.1 million reversal and loss of 72c pps.


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#9 odyd

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Posted 15 April 2014 - 09:14 PM

That means 40.1 million reversal and loss of 72c pps.

This is the price of arbitration? If included in Q4 results the loss would be a deduction of the gain first.

I am not sure how difficult negotiations with LDK would be. Sine the principle manager is different and the company is globally bankrupt CSIQ could settle this one with a lot less cost or nothing even. There is also a case with Hemlock for poly, which they promptly counter sued.


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#10 Scsnospam

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Posted 15 April 2014 - 10:06 PM

Odyd, did you sell all your JKS and are 100% csiq now? When did that happen?


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#11 sunnysky

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Posted 15 April 2014 - 10:43 PM

The one thing, which continue to bother me is the presentation's 14 to 16% GM for Q1, including projects business. We discussed this with the sale of Little Creek, assuming not being part of that GM prediction. It would be brilliant if they came out to say this, adding couple of points.

 

I did not join that discussion at the time so I just reviewed the thread. I don't think the Little Creek sale is material here. Simply from the guidance of net revenue and module shipment, you can back out the portion of project revenue included in their guidance. So as shown, project will be about $95 M, about 23% of the total. Without considering the 1% penalty from the fire damage (that should be covered by insurance even though timing of payment is uncertain), I see an overall GM in the 19% range. Are project GM and module GM suddenly fell to the ground? I could not imagine it being possible.  


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#12 explo

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Posted 16 April 2014 - 12:11 AM


Anyone else would like to share estimates?

 

As usual I seem conservative compared to you. I have based on guidance and cleaned of non-recurrents $0.13 EPS. I don't think Q1 is reflective of their 2014 though. EPS will be much higher in second half.


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#13 sunnysky

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Posted 16 April 2014 - 05:09 AM

Thanks explo. Yeah, you get about 13 cents if you use their top guidance range GM of 16% . I have not estimated the fair value of warrants. The warrants should have a gain but you also need to deduct the excessive offer value. Non-GAAP EPS won't change though.


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#14 explo

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Posted 16 April 2014 - 05:13 AM

Thanks explo. Yeah, you get about 13 cents if you use their top guidance range GM of 16% . I have not estimated the fair value of warrants. The warrants should have a gain but you also need to deduct the excessive offer value. Non-GAAP EPS won't change though.

 

Yes I only look at non-GAAP and further exclude non-recurrent charges in that and assume standard 15% income tax rate. I did adjust ADS count to include all new shares issued in Q1.


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#15 sunnysky

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Posted 16 April 2014 - 05:20 AM


I did adjust ADS count to include all new shares issued in Q1.

 

What is your share count? I included the new shares but not the warrants - not sure how JKS does this. If I include the warrants as well, I have:

 

Shares used:                     59,428K    

 

EPS:                                         0.35  (compared with 0.39 of Q4)

Average analyst estimate:        0.12


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#16 pgo

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Posted 16 April 2014 - 05:27 AM

Analyst estimates vary from .01 - .29 with average being .12.
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#17 kknd1234

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Posted 16 April 2014 - 05:28 AM

Hopefully they will do well on FX this time...


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#18 odyd

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Posted 16 April 2014 - 05:46 AM

In the case of CSIQ , Q1 could not exist, as it is not reflective of the organization.

I reviewed the presentation again and i was surprised to see how deeply they are going into China in 2015, pipeline being 1.1GW. I thought most of those MOUs were just that.

If Q1 is $400M, 2.4M is left to be generated for three quarters which doubles output of every subsequent quarter. Their earnings are to explode in Q3 and Q4, however. I wish they managed their plans to have more equalized revenue stream by using different parts of the world.

This is probably coming in one form or another.


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#19 Makan

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Posted 16 April 2014 - 05:55 AM

I think 2014 and 2015 are quite safe in terms of Revenue and GM. Japan is likely beyond 400 MW with old FIT of 36 yen ending 31 March. Odyd, how do you see pipline potential for 2016 and beyond? I think market is concerned that CSIQ will fall of the cliff in terms of new projects at good margins starting from 2016.


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#20 odyd

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Posted 16 April 2014 - 05:55 AM

Odyd, did you sell all your JKS and are 100% csiq now? When did that happen?

Hi, I sold JKS Firday and Monday replaced with TSL, which I sold for CSIQ on Tuesday. The only fortunate trade was CSIQ trade. I have stock below $24.00 and I have as much of it as I had last year at one point at $10 or so range.

I made my agenda to switch from JKS to CSIQ shortly before, on or right after Q1. However continuous beating on those names put CSIQ in a price range that I could not resist. The Q1 operationally is a history. If WS is in fact looking forward in any way, CSIQ is cheap on what is coming to them.

I like JKS, but they have small global exposure and focusing in China takes more of their resources by design of holding to plants. I see that CSIQ covers all strategies, including JKS's, and have more cash flow generation ahead of them than any Chinese firm, while making its balance sheet better, even when they spend. 

 

I explained this before, so do not want to put too much in a wrong thread.


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