Shanghai – Daqo New Energy Corp. (NYSE: DQ), a prominent manufacturer of high-purity polysilicon for the global solar PV industry, has reported a robust performance for the fourth quarter of 2023, exceeding analyst projections with adjusted earnings per share (EPS) of $0.94, a $0.10 beat.
Despite falling short of the consensus estimate for quarterly revenue at $477.1 million, compared to the expected $529.4 million, Daqo’s stock saw a positive response, rising by 3.54% following the earnings announcement. The company’s shares were up 1.59% on Wednesday morning.
The fourth-quarter revenue represented a significant decline from the $864.3 million reported in the same period the previous year, reflecting the challenges faced by the solar industry amidst decreasing polysilicon prices.
While the gross margin for the quarter improved to 18.3%, up from 14.0% in the previous quarter, it marked a substantial decrease from the 77.4% gross margin in the fourth quarter of 2022. Daqo attributed this improvement to higher average selling prices (ASP) and reduced production costs.
For the fourth quarter, Daqo New Energy reported a net income attributable to shareholders of $44.9 million, a turnaround from a net loss of $6.3 million in Q3 2023 but a decrease from $332.7 million in Q4 of the previous year. The company’s EBITDA for the quarter was $128.2 million, with an EBITDA margin of 26.9%, reflecting improvement from Q3 but a decline from the same quarter in 2022.
Looking ahead, Daqo New Energy provided guidance for Q1 2024, expecting to produce approximately 60,000MT to 62,000MT of polysilicon. For the full year of 2024, the company anticipates a production volume of 280,000MT to 300,000MT, signaling optimism despite recent market challenges.
Mr. Xiang Xu, Chairman and CEO of Daqo New Energy, highlighted the company’s resilience in a challenging year for the solar industry. “We maintained profitability despite the challenging market conditions, generating $128 million in EBITDA for Q4, and maintained a strong cash flow,” said Xu. He also emphasized the company’s strategic focus on increasing the proportion of high-efficiency N-type polysilicon in its product mix and reducing production costs through digital transformation and AI-powered analytics.