Xinyi Solar (968) H2 2024 earnings summary

Executive summary

• Revenue declined 9.3% year-over-year to RMB21,921.4 million, with net profit attributable to equity holders plunging 73.8% to RMB1,008.2 million due to lower solar glass margins, inventory write-downs, and impairment losses.

• Basic EPS dropped to 11.27 RMB cents from 43.17 RMB cents; no final dividend was proposed for 2024.

• Solar glass sales volume grew 9.6%, but revenue and gross profit fell sharply due to a significant drop in average selling prices and market oversupply.

• Solar farm business revenue increased 12.1% to RMB3,017.3 million, driven by new capacity, but overall profit was insufficient to offset solar glass weakness.

Financial highlights

• Gross profit decreased 46.3% to RMB3,473.1 million; overall gross margin fell to 15.8% from 26.8%.

• EBITDA dropped 38.2% to RMB4,392.8 million; EBITDA margin was 20.0% (2023: 29.4%).

• Net profit margin attributable to equity holders fell to 4.6% from 15.9%.

• Total assets rose 3.4% to RMB56,932.5 million; net debt gearing ratio increased to 31.0% (2023: 17.5%).

• Net cash from operating activities was RMB1,235.1 million, down from RMB5,305.0 million in 2023.

Outlook and guidance

• Industry faces continued supply-demand imbalance and intense competition, with product prices below cost for many players.

• Capacity adjustments and industry consolidation are expected to gradually restore equilibrium; short-term environment remains challenging.

• Group plans prudent management, cost control, and selective capacity expansion; no new grid connection target for solar farms set for 2025.

• Polysilicon facility construction is complete, but no expansion planned until successful commissioning.