Trina Solar Announces First Quarter 2009 Results

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First Quarter 2009 Financial and Operating Highlights

— Solar module shipments were 48.8 MW, compared to the Company’ s

previous guidance of 50 MW to 55 MW, representing a decrease of 15.3%

sequentially and an increase of 65.5% year-over-year

— Total net revenues were $132.1 million, a decrease of 38.9%

sequentially and an increase of 9.5% year-over-year

— Gross margin was 17.2%, exceeding the Company’s previous guidance of

between 15% and 17%, compared to 9.6% in the fourth quarter of 2008

— Operating income and operating margin were $6.8 million and 5.2%

respectively, compared to $3.9 million and 1.8% respectively in the fourth

quarter of 2008

    -- Net loss was $10.6 million, which includes
-- a $6.5 million tax liability accrued in the first quarter resulting
from a reversal in the government's approval for a past tax holiday

-- a charge of $4.6 million for the estimated cost in connection with
the cancellation of two polysilicon supply agreements

— Earnings per fully-diluted ADS was negative $0.42, which includes a

negative impact of $0.44 per fully diluted ADS for the above reasons

“Our first quarter was adversely affected by unusually harsh weather in

our key European markets, tightened credit conditions for our customers and

the general slowdown in world economic activities,” said Mr.

Jifan Gao


Chairman and CEO of

Trina Solar

. “Improved conditions beginning in April have

contributed to increasing customer deliveries and higher levels of new

contracts and projects.”

In conjunction with our recent visits involving over 30 meetings with our

customers worldwide, we received positive feedback confirming satisfaction

with our high quality products and greater recognition of our brand name. Our

core strengths such as enhanced brand recognition, high quality products and

industry leading low cost platform enable us to yield attractive margins in

both new and existing PV markets, despite challenging market and macroeconomic

conditions. In the first quarter, we continued to leverage our low cost

platform by reducing our manufacturing cost to approximately $0.79 per watt

for our multicrystalline product.

Moreover, we remain committed to ensuring that we have sufficient

financial resources to maintain a strong balance sheet. In line with our focus

on maintaining a strong cash position, we have increased our in-house

production capacities for cells and modules to over 400 MW as of May 2009, as

a result of improvements in production process enhancements and improved cell

conversion efficiency, which required minimal capital investment.

Finally, we are encouraged by recent announcements by the Ministry of

Finance, outlining China’s national solar investment subsidy program, which is

expected to commence this year. We are also involved in the development of a

local Jiangsu subsidy program, which is viewed as a model provincial incentive

program to potentially compliment the national subsidies. We are confident

that our Changzhou presence will give us access to project opportunities

created by these programs. To-date we have submitted 8 initial proposals for

the national subsidy program in our name and through project joint venture.

In addition to the above, due to the current economic environment, we are

continuing to focus on improvements in several areas, including accelerating

the reductions in our manufacturing costs, increasing our cell and module

efficiencies, leveraging our silicon procurement flexibilities, and expanding

our sales capabilities to capture growth opportunities in existing and

emerging PV markets.

Recent Business Highlights

During the first quarter of 2009, the Company

— Continued to benefit from strong customer loyalty from its well-

established PV partners throughout Europe and worldwide, whose businesses have

greater visibility and access to commercial and project financing

— Increased market share in growing PV markets such as Benelux,

reflecting a diversification strategy that includes 20 established and

emerging PV markets, such as Greece, the Czech Republic, Australia, and the

United States

— Increased sales to project system integrators, which currently

represent more than half of our total sales

— Continued to receive strong support from its Spanish partners who are

increasingly active in developing projects outside of Spain

In April of 2009, the Company

— Announced the completion of a 4.7 MW PV facility, one of the largest

rooftop projects in Italy

— Announced three new sales agreements in Germany totaling approximately

42 MW of PV modules for delivery in 2009, which has given the Company greater

visibility in its order book

— Expanded its European Sales and Marketing team with the appointments of

two key management positions. Our new managers have over 33 years of combined

solar PV and other renewable energy experience.

— Submitted proposals involving eight projects for China’s national

subsidy program

    First Quarter 2009 Results

Net Revenues

Trina Solar’s

net revenues in the first quarter of 2009 were $132.1

million, a decrease of 38.9% sequentially and an increase of 9.5% year-over-

year. Total shipments were 48.8 MW, compared to 57.6 MW in the fourth quarter

of 2008 and 29.5 MW in the first quarter of 2008. The sequential decline in

total shipments was primarily due to weakened demand given prolonged winter

conditions in our major European markets, limited customer visibilities to PV

system purchase financing, and market inventory adjustments relating to

government incentive reduction legislation in Spain. Net revenue includes

approximately $2.3 million of non-module income.

Gross Profit and Margin

Gross profit in the first quarter of 2009 was $22.7 million, compared to

$20.8 million in the fourth quarter of 2008 and $31.1 million in the first

quarter of 2008. Gross margin was 17.2% in the first quarter of 2009,

representing an increase from 9.6% in the fourth quarter of 2008 and a

decrease from 25.8% year-over-year. The sequential increase was due primarily

to the benefits of lower average silicon purchase prices. The year-over-year

decrease was primarily due to lower module average selling price resulting

from demand factors, which included abnormal seasonality impacts, increased

industry capacity and availabilities of silicon feedstock, and the recent

global economic and financial climate. The Company continued to focus its

efforts on reducing its manufacturing cost per watt through ongoing efficiency

gains linked to improved supply chain management, higher cell and module

efficiencies, and proprietary process enhancements in our ingot, wafer, cell

and module value areas.

Operating Expense, Income and Margin

Operating expenses in the first quarter of 2009 were $15.9 million. The

Company’s operating expenses accounted for 12.0% of its first quarter net

revenues, an increase from 7.8% in the fourth quarter of 2008 and an increase

from 9.0% in the first quarter of 2008. The sequential increase was a

percentage of revenue as primarily due to the decline in total net revenues.

Operating expenses in the first quarter of 2009 included $1.0 million in

share-based compensation expenses, compared to $1.0 million in the fourth

quarter of 2008 and $1.3 million in the first quarter of 2008.

Operating expenses include a charge of $4.6 million in connection with the

estimated cancellation cost of two polysilicon supply agreements. Operating

income in the first quarter of 2009 was $6.8 million, compared to $3.9 million

in the fourth quarter of 2008 and $20.2 million in the first quarter of 2008.

Operating margin was 5.2% in the first quarter of 2009, compared to 1.8% in

the fourth quarter of 2008 and 16.7% in the first quarter of 2008.

Net Interest Expense

Net interest expense in the first quarter of 2009 was $5.4 million,

compared to $6.5 million in the fourth quarter of 2008 and $2.2 million in the

first quarter of 2008. The sequential decrease was the result of a lower

average interest rate, while the year-over-year increase was primarily due to

additional bank borrowings to support the growth of the Company’s operations.

Foreign Currency Exchange

Foreign currency exchange loss was $7.6 million in the first quarter of

2009, compared to a $3.2 million gain in the fourth quarter of 2008 and a $4.0

million loss in the first quarter of 2008. This loss was primarily due to the

depreciation of the Euro against the US dollar in the first quarter, the

effect of which was partially mitigated by the Company’s increased utilization

of foreign currency forward contracts to hedge its exposure.

Income Tax Expense

In April 2009, we received a notice from the State Tax Bureau of Changzhou

Hi-tech Development Zone notifying us that the exemption and 50% tax reduction

for our taxable profit representing the proportion of increase in registered

capital had expired on December 31, 2007. As a result, the Company recorded an

additional one-time tax payment of $6.5 million arising from Changzhou Trina

Solar Energy Co., Ltd.’s taxable profit in 2008. Please see the Company’s

2008 annual report on Form 20-F filed with the U.S. Securities and Exchange


Net Income and EPS

Net loss was $10.6 million in the first quarter of 2009, a decrease from a

$0.7 million loss in the fourth quarter of 2008 and a $12.9 million profit in

the first quarter of 2008. Net loss includes the impact of the $4.6 million in

supply agreement cancellation charges, the $6.5 million tax charge, and a

foreign currency exchange loss of $7.6 million.

Earnings per fully diluted ADS were negative $0.42. The combined effects

of the supply agreement cancellation charge, the additional tax payment, and

the foreign currency exchange loss, net of tax effect, were approximately

$0.75 per fully diluted ADS.

Financial Condition

As of March 31, 2009, the Company had $194.1 million in cash and cash

equivalents, and restricted cash. The Company’s working capital balance was

$81.8 million. Total bank borrowings stood at $320.2 million, of which $14.6

million were long-term borrowings. Shareholders’ equity was $423.4 million,

compared to $433.1 million as of December 31, 2008.

As of April 30, 2009 the Company’s total short term credit lines increased

to approximately $523 million, which includes approximately $183 million of

unused available credit line. The Company increased its foreign currency

hedging program during the first quarter of 2009 using foreign currency

forward contracts between the Euro and the US dollar, with the goal of

mitigating, to some extent, the effects of exchange rate volatility.

Second Quarter and Full Year Guidance

For the second quarter of 2009, the Company expects to ship between 60 MW

to 65 MW of PV modules. The Company believes gross margin for the second

quarter will likely be between 18% and 20%.

For the full year of 2009 the Company reiterates the guidance for total PV

module shipments between 350 MW to 400 MW, representing an increase of 74% to

99% from 2008.

Operations and Business Outlook

Manufacturing Cost Reduction

For the full year 2009, the Company expects to reduce its manufacturing

costs by at least 15% to 20% through a combination of technology and

manufacturing process improvements together with supply chain and logistics

management initiatives currently under testing or development.

Silicon Procurement

The Company maintains a diversified feedstock procurement strategy

consisting of short, medium, and long-term supply contracts, which include

agreements entered into in the first quarter of 2007. The Company will

continue to maintain competitive silicon costs relative to the current market

price. Several of our long-term contracts contain price adjustment clauses

that offer a market-linked price formula that would apply if the market price

is lower than the originally agreed price in any given year. The Company

continues to renegotiate other medium-term and long-term contracts in efforts

to achieve favorable price and payment terms relative to current market


Cell Technology and Product Development Update

Through its research and development and technology transfer, the Company

continues to improve its cell manufacturing processes to meet its previously

announced 2009 conversion efficiency targets of 18.5% and 17.5% for its

monocrystalline and multicrystalline product lines, respectively.

Based on recent on-site laboratory test production, the Company has

achieved monocrystalline cell efficiency of 18.0% by leveraging advanced

passivation and metallization techniques involved in the PV manufacturing


In addition to improving its module output and low manufacturing cost

platform efficiencies, the Company’s technology roadmap includes further

enhancement of its Building Integrated PV (BIPV) module product lines, as well

as targeted application products offering architecturally friendly design

advantages and others for industry-specific use applications.

Existing Cell and Module Capacity

Through yield increases derived from increased cell efficiency rates and

improved production efficiencies, the Company’s annualized in-house production

capacities have been increased to over 400 MW for cells and modules in May

2009. These expanded capacities, located within the Company’s existing west

campus facilities will support the Company’s previously announced target for

2009 PV module shipments of between 350 MW to 400 MW.

Conference Call

The Company will host a conference call at 8:00 a.m. ET on May 28, 2009,

to discuss the results for the quarter ended March 31, 2008. Joining

Jifan Gao


Chairman and CEO of

Trina Solar

, will be

Terry Wang

, Chief Financial Officer,

Sean Tzou

, Chief Operating Officer,

Steven Zhu

, Vice President, International

Procurement and Business Development,

Arturo Herrero

, Vice President, Sales

and Marketing, and

Thomas Young

, Director of Investor Relations.

To participate in the conference call, please dial the following number

five to ten minutes prior to the scheduled conference call time: 1(800)884-

2382. International callers should dial +1(660)422-4933. The conference ID for

the call is 9965-1486.

If you are unable to participate in the call at this time, a replay will

be available on May 28 at 12:00 p.m. ET, through June 3 at 11:59 p.m. ET. To

access the replay, dial 1(800)642-1687 or 1(706)645-9291, and enter the

conference ID 9965-1486.

This conference call will be broadcast live over the Internet and can be

accessed by all interested parties on

Trina Solar’s

website at To listen to the live webcast, please go to



website at least fifteen minutes prior to the start of the call to

register, download, and install any necessary audio software. For those unable

to participate during the live broadcast, a replay will be available shortly

after the call on

Trina Solar’s

website for 90 days.

About Trina Solar Limited

Trina Solar Limited (NYSE: TSL) is a well recognized manufacturer of high

quality modules and has a long history as a solar PV pioneer since its

founding in 1997 as a system installation company.

Trina Solar

is one of the

few PV manufacturers that has developed a vertically integrated business model

from the production of monocrystalline and multicrystalline ingots, wafers and

cells to the assembly of high quality modules.

Trina Solar’s

products provide

reliable and environmentally-friendly electric power for a growing variety of

end-user applications worldwide. For further information, please visit



website at

Safe Harbor Statement

This announcement contains forward-looking statements within the meaning

of the safe harbor provisions of the Private Securities Litigation Reform Act

of 1995. All statements other than statements of historical fact in this

announcement are forward-looking statements, including but not limited to, the

Company’s ability to raise additional capital to finance the Company’s

activities; the effectiveness, profitability, and marketability of its

products; the future trading of the securities of the Company; the ability of

the Company to operate as a public company; the period of time for which its

current liquidity will enable the Company to fund its operations; the

Company’s ability to protect its proprietary information; general economic and

business conditions; the volatility of the Company’s operating results and

financial condition; the Company’s ability to attract or retain qualified

senior management personnel and research and development staff; and other

risks detailed in the Company’s filings with the Securities and Exchange

Commission. These forward-looking statements involve known and unknown risks

and uncertainties and are based on current expectations, assumptions,

estimates and projections about the Company and the industry. The Company

undertakes no obligation to update forward-looking statements to reflect

subsequent occurring events or circumstances, or to changes in its

expectations, except as may be required by law. Although the Company believes

that the expectations expressed in these forward looking statements are

reasonable, they cannot assure you that their expectations will turn out to be

correct, and investors are cautioned that actual results may differ materially

from the anticipated results.

                             Trina Solar Limited
Unaudited Consolidated Statement of Operations
(US dollars in thousands, except ADS and share data)

For the Three Months Ended
March 31, December 31, March 31,
2009 2008 2008

Net revenues $132,109 $216,338 $120,671
Cost of revenues 109,402 195,535 89,595
Gross profit 22,707 20,803 31,076
Operating expenses
Selling expenses 4,309 5,348 2,958
General and
expenses 10,660 11,308 7,165
Research and
development expenses 909 278 749
Total operating
expenses 15,878 16,934 10,872
Operating income 6,829 3,869 20,204
Exchange gain or
(loss) (7,646) 3,209 (4,001)
Interest expense (6,270) (7,011) (3,473)
Interest income 859 544 1,240
Derivative gain
(loss) 170 (1,067) -
Other income
(expense) (105) 1 (25)
Income (loss)
before income
taxes (6,163) (455) 13,945
Income tax
(expense) (4,459) (213) (1,072)
Net income (loss) $(10,622) $(668) $12,873

Earnings (loss)
per ADS
Basic (0.423) (0.027) 0.515
Diluted (0.423) (0.027) 0.512
Weighted average
ADS outstanding
Basic 25,091,336 25,072,076 24,972,588
Diluted 25,091,336 25,072,076 25,128,969

Trina Solar Limited
Unaudited Consolidated Balance Sheet
(US dollars in thousands)

March 31, December 31,
2009 2008
Current assets:
Cash and cash
equivalents $153,325 $132,224
Restricted cash 40,788 44,991
Inventories 79,109 85,687
Accounts receivable,
net 169,583 105,193
Advances to suppliers 36,631 42,247
Prepaid expenses and
other current assets 10,395 9,541
Total current assets 489,831 419,883
Property, plant and
equipment 363,816 357,594
Intangible assets, net 26,779 26,915
Advances to suppliers
- long-term 118,325 130,352
Deferred tax assets 5,064 2,808
Other noncurrent
assets 2,368 2,564
TOTAL ASSETS $1,006,183 $940,116

Current liabilities:
Short-term borrowings,
including current
portion of long-term
debt $305,524 $248,558
Accounts payable 70,339 62,504
Income tax payable 8,444 3,649
Accrued expenses and
other current
liabilities 23,762 21,003
Total current
liabilities 408,069 335,714
Long-term bank
borrowings 14,629 14,631
Long-term advances
from customers
Convertible bond
payable 133,721 133,248
Accrued warranty costs 13,789 12,473
Other noncurrent
liabilities 12,546 10,993
Total liabilities 582,754 507,059

Ordinary shares 30 30
Additional paid-in
capital 309,894 308,898
Retained earnings 102,090 112,713
Other comprehensive
income 11,415 11,416
Total shareholders'
equity 423,429 433,057
SHAREHOLDERS' EQUITY $1,006,183 $940,116

For further information, please contact:

Trina Solar Limited Brunswick Group
Terry Wang, CFO Caroline Jinqing Cai
Phone: + (86) 519-8548-2009 (Changzhou) Phone: + (86) 10-6566-2256
Thomas Young, Director of Michael Fuchs
Investor Relations Phone: + (86) 10-6566-2256
Phone: + (86) 519-8548-2009 (Changzhou) Email:

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