Daqo New Energy Corp. announced its unaudited financial results for the third quarter of 2015. Revenues were $46.6 million, compared to $34.3 million in Q2 2015 and $47.3 million in Q3 2014.
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Revenues from polysilicon sales to external customer were $34.1 million, an increase of 57.1% from $21.7 million in the second quarter of 2015. External polysilicon sales volume were 2,277 MT, an increase of 67.1% from 1,363 MT of polysilicon sold in the second quarter of 2015.
The increase in polysilicon revenues as compared to the second quarter of 2015 was primarily due to the increase in polysilicon sales volume, partially offset by lower ASPs.
With the ramp up of the company's phase 2B polysilicon expansion, the company produced 2,689 MT of polysilicon in the third quarter of 2015, an increase of 55.1% from 1,734 MT in the second quarter of 2015. The polysilicon ASPs were $14.98/kg and $15.95/kg in the third and second quarter of 2015, respectively.
Revenues from wafer sales were $12.5 million in the third quarter, compared to $12.6 million in the second quarter of 2015. Wafer sales volume was 19.1 million pieces in the third quarter, compared to 18.3 million in the second quarter of 2015.
The slight decrease in wafer revenues as compared to the second quarter of 2015 was primarily the result of an increase in mix of wafer volume through OEM service during the third quarter, as the corresponding OEM service revenue only includes processing fees.
Gross profit was approximately $8.6 million, compared to $3.6 million in the second quarter of 2015 and $11.6 million in the third quarter of 2014.
Non-GAAP gross profit, which excludes costs related to the non-operational polysilicon operations in Chongqing, was approximately $10.9 million, compared to $6.7 million in the second quarter of 2015 and $15.0 million in the third quarter of 2014.
Gross margin was 18.4%, compared to 10.5% in the second quarter of 2015 and 24.5% in the third quarter of 2014. The improvement in gross margin was primarily due to our continuous cost reduction effort in polysilicon manufacturing, partially offset by polysilicon ASP decline.
In the third quarter of 2015, total costs related to the non-operational Chongqing polysilicon plant including depreciation were $2.3 million, compared to $3.1 million in the second quarter of 2015 and $3.4 million in the third quarter of 2014.
Excluding such costs, the non-GAAP gross margin was approximately 23.4%, compared to 19.6% in the second quarter of 2015 and 31.7% in the third quarter of 2014.
Selling, general and administrative expenses were $2.9 million, compared to $2.8 million in the second quarter of 2015 and $2.5 million in the third quarter of 2014.
Research and development expenses were approximately $0.1 million, compared to $0.2 million in the second quarter of 2015 and $0.2 million in the third quarter of 2014.
Other operating income was $1,115 thousand, compared to $667 thousand in the second quarter of 2015 and $574 thousand in the third quarter of 2014.
Operating income was $6.7 million, compared to $1.2 million in the second quarter of 2015 and $9.5 million in the third quarter of 2014. Operating margin was 14.3%, compared to 3.6% in the second quarter of 2015 and 20.0% in the third quarter of 2014.
Net interest expenses were $3.0 million, compared to $2.5 million in the second quarter of 2015 and $3.5 million in the third quarter of 2014.
EBITDA was $15.0 million, compared to $8.4 million in the second quarter of 2015 and $16.4 million in the third quarter of 2014. EBITDA margin was 32.1%, compared to 24.6% in the second quarter of 2015 and 34.7% in the third quarter of 2014.
Net income attributable to Daqo New Energy shareholders was $3.1 million, compared to net loss attributable to Daqo New Energy shareholders of $0.9 million in the second quarter of 2015 and net income attributable to Daqo New Energy shareholders of $5.9 million in the third quarter of 2014.
Earnings per basic ADS were $0.29, compared to loss per basic ADS of $0.09 in the second quarter of 2015, and earnings per basic ADS of $0.66 in the third quarter of 2014.
As of September 30, 2015, the company had $68.7 million in cash and cash equivalents and restricted cash, compared to $95.1 million as of June 30, 2015 and $30.0 million as of September 30, 2014.
The decrease in cash and cash equivalents and restricted cash was primarily due to loan repayment. As of September 30, 2015, the accounts receivable balance was $15.4 million, compared to $7.0 million as of June 30, 2015.
As of September 30, 2015, the notes receivable balance was $16.5 million, compared to $38.3 million as of June 30, 2015.
As of September 30, 2015, total borrowings were $259.1 million, of which $143.9 million were long-term borrowings, compared to total borrowings of $266.0 million, including $100.0 million long-term borrowings as of June 30, 2015.
For the nine months ended September 30, 2015, net cash provided by operating activities was $65.6 million, compared to $47.7 million in the same period of 2014.
For the nine months ended September 30, 2015, net cash used in investing activities was $82.7 million, compared to $81.0 million in the same period of 2014.
For the nine months ended September 30, 2015, net cash provided by financing activities was $38.1 million, compared to $38.1 million in the same period of 2014. ■