Canadian Solar (CSIQ) 18 Mar 212020 Q4 Earnings call transcript

Ladies and gentlemen, thank you for standing by. Welcome to Canadian Solar's Fourth Quarter and Full Year 2020 Earnings Conference Call. My name is Ajay, and I will be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session.

conference recorded this replay reminder, a is for being purposes. As the now Canadian to like would call Solar. to at I Manager turn over IR Isabel Zhang, Please go ahead.

and to Thank website. that note, Investor are provided today's Solar's welcome available operator. accompany have XXXX everyone to call you, fourth call. And we quarter Relations conference full slides Please on year conference Solar's Canadian which Canadian

Shawn this will Solar, are will President strategy. majority questions. Corporate Shawn Yan of of by CSI the which go today overview Solar Canadian us CSI Huifeng In Zhuang, will Solar owned the session respectively, business an time Dr. outlook, Solar's call, Energy of Canadian through Global have VP Solar's overview release, participate Chairman VP CEO; Joining Senior Q&A and go executives today's we Huifeng will owned structure. Shawn after provided and remarks President Guerrero, the conclude the subsidiary, new All after will an for On and of Dr. through Chang, Ismael formal company management's Business. in wholly Qu, of we CFO; Yan followed Canadian and review highlights have segments reporting results. the Energy prepared will and with who the earnings the respectively Ismael financial remarks.

well. Energy as The formerly Solutions As business includes was Solar's CSI Module and System a China which Solar, reminder, business, now Canadian

been provided and period conform Global going to management current results be business. presentation. and will In Global is release. addition, Certain the today's Global the Solar press financials to These historical solar segment forward, as and business Energy Energy Energy CSI are have the reported services O&M in revised includes now called projects, asset financials

of prepared as the uncertainties. statements contain may expectations. to today, we contained is future as as A listeners these Litigation of are represent in forward-looking to answers will to the detailed unless risks XXXX. discussion otherwise the projections Safe applicable future, may SEC that the Act statements protection with no assumes of the by Commission. GAAP. remind and and Company results the filed Accepted remarks well claims in Management's update projections Canadian or forward-looking that report presented Actual obligation their required management's Reform Form questions remarks that estimates current more regarding be Principles, management's subject Before in Generally begin, be XX-F the will can Securities of and I Company's Company's the Exchange for Solar today. annual law. Regulation of found on Accounting Harbor Any management's of Private prepared within the Securities from G performance requirements uncertainties risks differ

accordance By intends measures Some permit and of further a basis. trends. underlying management financial information provide non-GAAP performance during call both, to non-GAAP and on certain will investors information, analysis GAAP the additional better Management viewed with not Dr. operational with to call investors over data please go to Qu. turn a Solar's [Technical as operating for to goals. Shawn in Non-GAAP ahead. Shawn, and I CEO, establish and like substitute be prepared Canadian should performance non-GAAP provided presented be uses the assess now Chairman Difficulty]. would disclosing information to information to Company's by the

gross and solar for for for also challenging in joining Isabel, and business me, was us Canadian XX.X% and but Solar, strong - billion a delivered XX.X everybody. We today. also for thanks entirely. our $X.X very everyone. the margin. for year, not gigawatts one Welcome, for it is But only in business, you, Thank XXXX in hi, revenue, shipments, a

shipments, QX, like of their during focus which gigawatt challenging for and the great year. was EPS We $X.XX. In of towards achieved of I this our thank guidance. work delivered team diluted to would also our high-end X we

We also our margin, gross expectations. achieved ahead of in billion revenue, XX.X% both and in $X.XX

go quarterly and more Canadian Before the through I Solar's details, our on Huifeng market results strategy. Yan, share would in solar and Ismael some like thoughts to

Now, let's X. the slide number to turn

We grid parity of societal need economy. point solar is global at decarbonize awareness in inflection met an which growing are the to urgent with the

we and or and several give energy solar annual renewables largest energy were continues calculations. is competitive At past of the solar These levelized around talk at perspective, market new accelerating opportunities a you times Solar they no independent commit third-party advantage. This over urgency. decade according installation mover Canadian frequency Yet average few has penetration X was I that as natural some near has economies of about and more targets, solar penetration to moment ago. among the other in decarbonization an as To later market which in become the electricity penetration what is to been are most storage. Likewise, cost will level the battery decline concrete of catastrophes past to and to it X of the such solar a high remains LCOE adding for at sight. X%. electricity in all Solar the early significantly to times a end has sources will increase, the on. just have demand in competitive create in has a quarters, this distinct major seen decade, over increase change also with factors of related climate assets now

to Now, let's X. move Slide

growth backdrop, this our under remains unchanged. Now, strategy

we - our growth we're invest capacity expanding Firstly, in across and chain. or the supply long-term investing

monetization and Secondly, optimizing are project strategies. development market we growing our presence project our

on Lastly, multi-year we executing growth storage. energy areas, including are

turn to X. Slide Now, please

now, this in in seriously, the for building to changer, account half technology been starting expertise we as the over have are reaching Canadian not the of scales. storage large growth opportunity Mackenzie, energy, our just to We're storage. this next for global And of U.S. think for At global market decade. capabilities solar storage battery we but and for total total been past gigawatt energy two the reach will a roughly game in exponential is out very market XX% several segments. market Solar, the Of that demand we Energy see XX additions, applications taken for market the both, system XXXX as our global have decade approximately have market hours. in and According will in years. Wood market XXX We over and be years, front-of-the-meter integration our we and our next over building hours, grid. will Global the electricity the capacity Hence, as technology gigawatt this, CSI account well Solar will energy

turn the Now, number slide to let's X.

and focused Solar future battery fully-integrated team includes of the press proprietary is technology release, solutions. bankable capacity battery its offering, solution long-term on CSI services. delivering As we explained the the in storage This augmentation agreement end-to-end the service batteries the

We hand hours on gigawatt slide. of table nearly this the the in have pipeline storage of system X on left shown business, integration is which

storage our right-hand development gigawatt hand, scale now an other We is integrated Global the storage have our side. global On pipeline, nearly table project hours is which utility X part of business. of shown business the on this now Energy on

solar early in Our market us the what competitive did similar development to in the opportunities in advantage attractive days. a returns, storage global geographically-diversified early gives capture and in we presence and identifying

as both, to are work [ph] projects new co-located opportunities, storage which PV projects, as in these past, well part and delivered were solar solar the retrofit some of are on Some separate third-party are though projects significant stand-alone and work batteries. respective arise. on not all There even are Meanwhile, these synergies, market as two both overlap opportunities the teams teams. their projects we

turn to slide X. let's Finally,

are subsidiary, listing and planned we our on-track China the milestones. Solar completed have of CSI Regarding targeted all the we

the regulatory exchange within this We stock expect in We're to to complete targeting authorities material to year. and official next submit months. the the the IPO

ahead. With into let call could me talk uncertainties; to turn However, of over He CSI therefore, about year. Solar. the please as there we that, Yan, next know, all Yan. are performance will it slip go the

expectations, price. in Thank $XXX year-over-year. you, reported up to XX.X we XX% In billion, better in billion QX, $X.X pressures In delivered mitigate with as $X.X XXXX, Shawn. was and part from which business. selling gigawatts increases cost of Energy revenue as the able formerly was revenue were of Solar including Energy some delivered we average China around CSI we gross margin, than the in shipments, XX.X% in our million

X, QX those Prices and in has currency of on a situation, since been cost RMB, - exposed the we has Chinese by accounts level. deal not Turning of With which majority appreciate remained which solar increased prices to the of currency to costs, appreciated main for like main to continued include revenue great market improved modules, XX% our you against has elevated are I'd Infolink's Polysilicon And revenue depreciated, recently margin commodities, to based data. update which used by which the cost Slide PV currencies, the basket continued our another last and to squeezed. the quarter. the on most at the increase.

expansion, positive started side, the our glass been to partners logistics to we have during On We've capacity down, the closely our further to lower come costs. with year. working decline expect with and it prices also transportation solar

supply reduce us changing transparently cost increase in We closely and communicating some with chain, customers, importantly, the expect year. burden. us gradually some the our costs our this to has prices will the And we've dynamics share help working through which allowed of been

is The bottom number era us. behind largely that important cost to ever-declining solar the prices slide approaching of to it X; understand Turning are module is curve. solar of we the

fact, main prices actually near-term, driven are have factors. seen, three In up. going is as we by This

technology more to solar a decades, us cost combination of driven the manufacturing, has industry. past and by from a by of than the scale of subsidy a declined to two allowing over market-driven move First, XX%

most advancements is mentioned, produce Shawn efficiency gains. to to and driven in way cheapest solar decline, the by continue PV LCOE markets technology As will already solar and electricity

decade a has of Second, modules total over ago decades system total cost to today. as percent the the cost system of solar two-thirds - from declined ago, a a the cost to of third

small. of margin And third, is solar module very further very for the is from assets benefit solar demand in strong. reduction So prices

wait development cost no market. is reach come curve the Given We think we for solar down. in parity longer the grid for industry positive our this prices of to factors, it these as module to the solar bottom pays a

and XX; for Solar strategy solar to will one focus CSI premium segments the global brands, and markets what so mean slide Turning our does top us? of this on channels. increasingly As

in position have to we will the market-leading pricing stickier customer our distributed example, For continue where a greater we markets power base. generation and enhance

for shipments into proposition this year, even the globally, our In fact, half more value this than went accounts of market. the of though In this last total the channel, XX% we solutions, channel integration system are less including matters than channel, a just it's is solution system is than driven This storage. higher working battery total utility. user value-add more the lot, by because why experience total on

scale, utility we our increasingly working on For segments, are which and important storage, but is across are solutions, we focusing industrial present all initially residential on commercial, also for strategy.

year. As gigawatt Shawn which pipeline we of X gigawatt be significant this nearly already hours will a of delivered have detailed, X hours nearly

Now, pass on Ismael. go let me ahead, Please to Ismael.

Yan. QX, pipeline to Slide we we In that sales Italy. you, over XX achieved US, which gigawatts we've exceeded from proud turn the closed sales, XX year over Japan, in in in Meanwhile, XXXX, one Thank gigawatts increased Please project to target. Canada our spanning to project I'm megawatts Mexico, X.X and XX. project our ago. report gigawatts XXX total

that We plus dramatically. solar demand increasing including are projects, hybrid is solar the seeing of storage,

few developers, on the are standalone very of the growth trend. one to well capitalize renewables project secular positioned we As global

three the areas. we Specifically, our focusing following are on strategy

and importantly growth. First most is

development our variety signing different with activities of a We expanding geographies are purchasers. growing power across PPAs and

sales our new will Solar interconnection Green market. that Japan a the growth support also and is the Canadian development year. strengthening X last expanded this the Canadian different around targeting abilities announced operating did means, are from our Recently, capability financial in This our by Japanese launch we the project our by holds This X XX% project that of pipeline over five to around gigawatts Note allow currently sponsored expand the as We to next and permitting and Solar, is Infrastructure we is we us assets will XXXX, CSIF compound accelerate only. which Fund, are in over to what project we Fund. platform times of expanding years. achieve sales Overall, continue Infrastructure growth. development growth

selling ownership projects we retaining optimizing Second, to certain been and in strategy, project have developing from minority monetization in markets. our projects

to we the ecosystem Solar I quarter, additional lifecycle. the last to value expect As capture Canadian through said enrich project

of and O&M gigawatt gigawatts Energy implications in Brazil, series through ago, also on and in In Japan formation soon investors. have as generating an investors. X X one quarters. XX%. Italy, for projects. this localized over Fund, Canadian megawatts [ph] additional capturing under have from and a $XXX vehicle; we CSIF over have are of operation. that position well gigawatts recurring yield power a construction. projects, are as set completed Similar will to of retained attract the wide doing have where the maintenance its Japan, operations the start or X.X largest reach capital revenues production risk such contracted of be EVC This dividend the proportional projects completed operation, over O&M few In And around [ph]. of We assets of this, we expect recurring CSIF's proportional continue raise to we have infrastructure assets to To XXXX, couple profile a O&M, capital XX of are the we the sales, or forming management start vehicles, to asset management. projects [ph] of the partnerships reestablishing own Solar of of Global flows. Currently, O&M retained, in recently recurring services, forming next in example, we will the reducing X.X appreciation the stable and share also of will around and assets By significant we million XXX gigawatts retained, have projects of cash with which been we in FIP-IE with currently included amount we range will Infrastructure as overtime. by increase a achieve construction capital the first increase fund contracted assets the stable business the weeks we long-term infrastructure cash CSIF, flows assets of gigawatts

this nearly Third, less have inroads Huifeng. from profit In we Huifeng, almost tripled projects. gigawatt pipeline and go in exciting we Of that, very are X our these, hours to the making is turn year. gigawatt significant gigawatt significant to hours in the X last hour total is With space. already strategic over this X storage storage opportunities XXXX, under growth with battery than storage me year construction; let call please and ahead.

QX the to XX. well of delivered revenue in Please around XX%. you, to Thank turn Gross $X.XX slide last over was Ismael. above XX.X%, margin QX We X% of XX% billion, quarter. guidance up our

and in as and module optimized worked in outpaced costs we surge QX appreciation an engagements our the our in achieve there above for outcome various the were dynamics our While unfavorable hard that on RMB, higher our to ASPs customer own that such material in expectations well logistical quarter. came and supply chain

this to have gross segmented margin shipment revised better units for off closed year, two important, million an than overall and To sales built of mentioned, the achieved project capture challenges the drove quarter. pandemic. of our Shawn higher performance, strong we in the reporting we Additionally, XXXX, successfully business have we years, Equally XX.X%. we spite over in of $XXX our up XX% cap the more volume module of as

business contracting which services management. carve-out respectively two battery such ownership present unit Firstly, are the This the O&M retention better information understand investors and business segments. as Energy. new help growth for story, To the business going storage and our our long-term pursuing [ph]; income secondly, project and to asset within recurring additional the represents we IPO sales the from Global CSI captures Solar, and

battery revenue; as on on storage we single CSI the plants Global storage from as Solar, typically hybrid solar splitting not project On solar storage component are up service the we inter-linked considered segment, will have and the revenue investment. we Within integration sales power Energy a pipeline. present are Energy, component, Global

QX more distribution due revenue CSI and to increased second expenses projects based based cost for the service Solar contribution revenue announced and of be integration the on on Solar CSI report storage that accelerate we milestones. the To sold, earlier, storage transportation. schedules. signed than in to on construction these continue storage will spike will expect XX%, captured revenue on growth to you color from Energy Global Selling starting construction shipping according we by will While give more revenue quarter XXXX contracts

the equipment; one-time G&A On to driven higher, Otherwise, other our led over $XX this G&A manufacturing impairment a past expenses of mostly charge. would have remained were non-cash by million flattish hand, higher OpEx year, challenges control The expenses. lower last and quarter was discretionary foreign Full-year X% fourth transportation outpaced was gain quarter. exchange cost cost than as million. $X tight net in the

was and continue a future tax of adjust Income our activities to accordingly. to will We expansion or Full was Net $X.XX benefits the QX with as carry tax RMB, particularly share. currency exposures, income some against we $XXX million shareholders to $X was diluted this million benefit more reduce capacity income expect year share. quarter; diluted we factories per plan. hedging continue to million manufacturing shareholders in per $X $X.XX or our

cash onto building year, Manufacturing our the slide scale than sheet sales were we balance in $XXX XX; Global and Now, Energy. lower in this moving re-invested a from CapEx operating in CSI on substantial guidance. larger generated Solar million which billion we into earlier XXXX, $X.X

the to with the along, invest CapEx into Solar into expand fresh CSI we raised capital pre-IPO year. that slow Additionally, [ph] this will investment

market in are to we XXXX, depending outlook and $XXX on up to million conditions. the [ph] prepared For invest CapEx

will manufacturing, year profitability. this to and prioritize CapEx the retain spending productivity flexibility adjust then We continue and to

strong improving fund the So at with flexibility $X.X than cash that, our better financial cash CapEx spending total years. us to billion, position the a remains position giving and prior

to managed $X.X [ph] to debt we've elevated, billion. our down remains level cash total As

at of restricted end cash year. of Our net remains to EBITDA, debt the level excluding the healthy at X.Xx

me who it with Shawn? and will guidance to Shawn, let our outlook. Now, conclude back pass business

Thanks, Huifeng.

QX XXXX guidance and the the about talk both annual let's Now guidance, guidance.

of be all project. Total of is X X.X to the company's XXXX, revenue shipment we billion to billion. module including the $X.X first megawatts total expected For to shipments XX% between in be in of quarter range are to to margin approximately XXX to expected be gigawatt, expect module the to range Gross $X the of XX%.

For the revenue to shipments to total gigawatt, $X billion to of billion. in the gigawatt, full $X.X we of XXXX X.X in and X.X total project sales of a to XX XX year reiterate be range be to range

reflects solar expected. high also growth which improvement sales already our projects, QX reflects We margin excited as gross in Japan, especially long-term The quarter-over-quarter updated have we very better opportunities announced. our previously storage. in of the Our guidance about financial remain and energy profitability

continue our deliver shareholders. advantages building open I on to that, to With will now to to sustainable to call our We questions. returns the competitive focus Operator? would like your

Instructions] have the from first [Operator Certainly. go from Lowe that the Please, ahead. question We Citi. of line J.B.

on to Hey, start good by as be quarter high to gross mentioned, sales. morning, I project some to margin was everyone. the I XX% guidance, margin XX%. first the Shawn, the give if wanted you we some could wondering between Or business? gross global just on break expect and down between the margin what brackets you the Solar on maybe guidance segments? two the CSI energy can could impacted

I Huifeng? maybe will question. Yes. this Huifeng handle let to

not but breaking some the Solar high-level you details, usually color. higher CSI the to can margin I do two give global is side. provide down The the and all energy side We on businesses, on lower the

you you to Okay, first fair able QX, pushing what guys that the increases I will I of quarter? be push of kind you but going of in into cost progress the seen the just How do side. of cadence guess ASPs percentage the the enough. think And margin higher to think then on know, outlook, through the you're have kind that throughout do module year? And specifically gross it's

Yan to I That's very like answer good question. a Yan? question. this would

question a wants that's that good get everybody very Well, to Yes. answered.

year, carry the the chain orders QX us some to with and hand, supply the I we and last we from other the think also, our communication some ASPs we bridge transparent cost to on QX, helping QX, hand, but we level. one moving that from some on raised by of of successfully low-price customers still for arrangements successfully have

okay super did a not - actually we QX, actually we quarter, So but survived.

seeing stabilization the is the rest the because and chance likely to down. glass of of with bigger exchange coming the moving shipping year. rate that price the impact. a were see that for see So, down also, to We cost the go we And actually the continue also we're of ending improvements COVID

half, wafer weakened. pricing Moving also we're the diversification second to power, of power be suppliers, basically, the is monopoly the to going observing

others, to that to So waiting and People there's on a also has now of down come under project. realized going been for come much overall, that to of we kind that the build believe projects module timeline that are urgent lot it's that many waiting list. they're they down so and not

to better a we So that see starts pricing. customers are - to module customer actually start accept

So trend. this is the overall

we think observation market year, I the continue the margin rest So of improve. This is situation to our our of the moving evaluation situation. to and

Okay.

This I is November Hi. like we Shawn. back said the what This QX expect is X% last guidance on Remember, Shawn. Hi, be XX%. gross said. provided Yan year. would to J.B. in our to to we supplement We margin

Our Solar margin the side, indeed range manufacturing this in has QX. side, less more gross CSS the in or

therefore bringing energy XX%. over to the margin, higher However, contributed the total global up

year, moving this ASP. pushed successfully QX into the have Now up we

However, up. costs said, also the material as somehow Yan go

Solar to gross we to at margin move XX% we'll high this The margin. still project they that and for the QX business however, end energy So up XX%. CSS us total helped probably side in this believe [ph] in range, from the moment are

two luckily, each to So always Solar Canadian We another has supplement we'll I have segments, other usually two guess while which segment. the wins. help

one can't to move manufacturing, CSS or you company the we QX, margin move plan in believe say getting into as we a focusing November. we control there gross range our said as XX%, We are low-teen let's about back have moving are fighting know. the factors certain still to but chance, a which Now, Solar

effort like bare-improved. showing price control the are also the cost in we that and seeing a in However, raising our

can the customers. partially reasonable we'll be I maintain the guess be our cost how at able over question your to or least much be it shared [ph] margins. by of that passed somehow, increase So still to customers, gross answered on can

I was else someone Yes. Thanks my on. I'll will let hop questions. answering excellent. for Thank That you.

you. Thank

line Please, from question next Philip from ahead. Shen our have ROTH We the go of Capital.

taking for lot the that was margin Thanks questions. Thanks sharing outlook. detail that. for a Shawn, Hi. on my of good

up energy Following about talk that, to business as the well? in margins Solar you Can margins about how trend expect you trend you QX on QX. CSI talked how could the in

business, sell We be which global particular project depend expect high to balance QX, we and out improve. therefore part that energy margin as some QX we'll the quarter in able on lumpy. the similar to Well, And in sell margin and we what on margin high have sometimes said, sold project job don't QX. will to to CSI this to in do order better a side continue Solar is

great storage, you. you over Shifting a color on thank Okay, of lot guys gave business. that to

thanks could profile from in that was could coming margin the that. business Huifeng, and QX. the revenue might kind business And about storage for this talked business if you year for I think, of have you revenue I what Thanks. be? share what contribution So more wondering the of

energy and two we one that, battery Phil, business. overall significant development as side, side first energy. storage of all, the project depend system project side et well-balanced mentioned storage are the booking other earlier, construction development revenue growth which is and business, development I on and the about the the mingled SSES part of talking revenue solar for XXXX side because between for of cetera The Solar in does integration the the milestone they a have global schedule sides: with project is the revenue integration and units: also battery two storage, CSI is on the system global business the on

So, projects in that the you will know you is out quarters. what do we cannot the size the into and the the you the battery estimate coming business what of storage start there, Right? that from of U.S. XXXX. then XXXX from an But over forward give and you overall get exactly going can also And are numbers can

if Okay. Can one may? I add more I

would like Yan the I CSI Solar from comment to side. Hi. further

the the sales. millions solution storage, going dollars you not into of the hundreds it year revenues number is system give on terms side, of of time I'm the recognition of the total in but than exact profitability-wise, year, to schedule significantly or integration the So better because the over next it's module of the and level like for side

high of So, high very depreciation manufacturing that that's also and the is not solution CapEx actually is percentage business net healthy. It's a profit - mass business. a the level

indication it's better That's module can the So you. I than give that sales. much

Thanks, Yan.

Ismael, color do on the energy XXXX. more revenue the provide to development you battery side from want global in

Sure.

quality providing of the this on of everything on very then to going are we In to projects, depends can have the Shawn PPAs think mentioned the have now we before, year as are very is for, the a details the and it demand. that construction geographies What you right that you be signed. on them that the significantly terms is of [ph] the profitability tell PPAs going of better we solution have getting from is quality margin. lot strong the than of the the average we I and that just out under lot [indiscernible] delivering because that expect we I storage of The high a of projects are

know time appreciate detail other Great. status. the range on listing color. Shawn, all One China was on I Thanks of Really as for gave in depends it's that. and do it a it the some XXXX? question do more some China control. you healthy of likely listing But probability think think in gets you out you a done Or lot the you that to completed. quick timing were can your But XXXX? guess, things to be it's a good wide when if

the case exchange will we rounds, there exchange, of the hearing, you review. to go wide that three questions it's approve for next just rounds the said be We China hearing registration. what that Actually usually range. And not very exchange it's two schedule or which detailed, process. a sometimes clear Philip, to ACC month, the brought just a a be disapprove. to from four have will means mean the SEC the whole range. the meeting submission That's that, and I level like Well, official through to your after Once will with review in and - April. very after approved, expect will that, And make

that process you in the or long, the typically, is rather period six you'll U.S. listing then And according be and like still of or [ph]. end the it's start we compete roadshow targeting to then the So months year. will two takes this in and like are the take take like years, long year - to way, in schedule, in we roadshow, five goes look why this the to not that's If year. yes, one if the past China will typically and The timing we everything the that roadshow. roadshow by at say week

can Also, get or gets it questions anyone the the surprise a have to regulatory However, me won't market if additional whatever. slipped authorities little Therefore, may it of bit or to split won't change. sort it surprise XXXX.

Got it.

I'll Okay. again. Thanks pass it on.

Operator?

Thank We'll our ahead. Please the next from from of Rusch go you. have line [ph]. Oppenheimer Colin question

North whether from, to Latin side the it's Europe, in On for hydrogen, America? potential hydrogen, related particularly projects project green America or

good very Oh, that's question. a

another to pack say like is a yet. At energy We can't into us hydrogen offer I have and interested this general hydrogen storage. also green way Hydrogen hydrogen, we advantages of are very leads moment, which to in a that knowledge hydrogen.

total have green system you moment, we energy a busy battery pipeline I chemical solution system - But project will And working the also the energy the the the concrete project with are the project. guess and we development is project with best energy the hydrogen the all storage a pipeline. once for looking storage. this technology gigawatts some mature offer. mentioned, have nine we of of that ready to At integrated - I partners systems, the update We pipelines and and

delivering. We in are process actually the of

Excellent. you those That's super you are sheet helpful. financial what target guys which And and projects that on then for the sense as on about us which to projects evaluate diversity portfolio? you how the of think geographies? Can retain a characteristics balance geographic give and

into your question Okay, falls That square. Ismael.

make thinking are truly giving we whether rumors return retain might that you. only the depends as the the It that running experience based X.X by on to time. have risk Europe, already on that next having we a look, asset decision. going that, will Shawn. are we and Japan, is question. maybe something the maybe add We know. not asset value easier to the you up. think going the some our will [indiscernible]. for that ingredients that region, value it are on we're the UK, sure doing it is like intention a the projects you, be to Thank small company U.S. experience making be we be But believe looks environment the of to we it's Sure. on will a for Brazil favor consider probably but it the focus making also you the the volume this. saying so In probably we also to overall. the And where percentages. us from more that, If volume region about The there. want in have changes are And coming Very up how in is Thanks Look, very making it. like to That's are way another we [ph]; it's ones clears making the make and are be else U.S. of because region holding Regulatory we enough Italy. over on it the would that to we good and in always hold and lot

intention retain to a small the Our volume. of big is percentage

capable not are volume understand this help Does what are you we do? pursuing are not percentage. the retain to we we a within region, trying if be to to to on going a big So

Yes. this have couple follow, a take but Thanks Go guys. I'll Shawn. offline. I so much, ahead,

Yes, Colin, like add I some would colors here. to

to the how order For very, individual energy projects sometimes pure strategically storage there's project. whether shares got say project who on good good situated that and want some project, actually example, for offer think project very strategically, U.S. buy I economics from to the decide And is investor the we we When one return in in XXX%. to depend depend want very on [ph]. we

that a to will operation we considering can storage understand energy minority also learn an believe project, of we retain the just lot. that [ph] and ownership the We the better first We the project this we project. because lot retaining storage be U.S. thinking in revenue are a of a which models on ownership saw For energy

But is yes, consideration. indicator So one economic importance also a consideration. sometime, the is strategic

So that's one answer to your question.

Now another second, that vehicle to our in are release launching in geographically, press we whole did say Brazil. we project

are we vehicle. a which Italy, structuring mentioned also We

of than return vehicle area structure in on all, the we Therefore, are a think sale individual So we have quality first can we the projects just project that those scale. high basis. rather the or

at Ismael, change will be there of policies of ITC Actually, he there Ismael's the infrastructure new he regulation of ways. that terms some comment, and U.S. the in means mentioned in in also end Now, be bill terms whether may different of some

pay direct for example, options For ITC.

holding Now, much the change U.S. if the our value significantly U.S. in the also also then and now that more of U.S. much, fundamentally project in projects that increase happened, make market we'll and profitable

we're are we're are just not we interesting, signals. the some we change analyzing - in no, but very So, encouraging policy waiting, But U.S. seeing very waiting

so much, Thanks Excellent. guys.

next the question. We of your Please, with Goldman from have ask the Sachs. question Brian line Lee

question, Hey, the Shawn had Maybe just a questions. on guys. Thanks margins. taking I start, to for gross the clarification

same XX.X% I'm global be it Phil's for you the back back in I it think And you of in think margin in your cadence margins up around CSI. then incorrectly. was you and and questions up, release, maybe - earlier was about gross it or their the was CSI press to to one I global to margins CSI QX. QX for to And energy maybe commentary the maybe... - your X.X%. solar that mixed would suggest of reading energy maybe seem But showed

Brian?

Yes.

I you question. this yes, realized I have that a sharp eye. answering up sides when very two Brian, actually mixed was the

you yes, right. are So

Okay.

number pull up, the the For you too. should QX,

Okay.

put mind expecting be then Solar XX%. CSI improves QX do QX then and guess, being and up my and probably back we of XX.X% XX%, CSI up improves guessing to to it sort just with in to it in from QX. input when I will for I'm saying You CSI, So QX basically you're question, And is because cost you're get Shawn, levels? to of that down then QX, from QX back

get that be to of to you'll XX% XXXX end do to back back end back XX% just QX. CSI? the we by of QX You're the Is levels? XX% implying When by to, in that year, be you'll

in is And still the QX. second of Yan target we're the gross some half the our teens headwinds QX, to to Hopefully targeting Solar and to There in level. for bring to Yes, CSI low year. meeting as back bring the margin are mentioned.

However, some there are also tailwinds.

we through the we which of passed contract have signed year. last low-price For example, mid

We money have QX; still all contract obligations lost meet you those decided contract but obligation. contract in some gone we to on through we all know,

So signing there contracts; are from QX tailwinds as some fresh side, all so - well. are we

yes, believe our fight team I effort. good with with headwinds job So, do - a to will

Okay, thank clarification. helpful you. That's super

just I modeling cadence here. much think is it since focus module so there especially margin two the purposes helps everyone the the for between segments, on

Okay.

then under the million look sales reporting. in did XXXX; you was at on did that's little a new the I gigawatt project revenue actual, in you over I of - and $XXX of the segment the if Global Energy net had business, again, question Second Energy Global X.X

in So, outlook? guess, a on watt like X.X should I similar the - X.X for $X.XX XXXX to we implied gigawatts expect a the ratio project sales

sales it's I for guess depends on the team can little more COD provide data complicated. after bit call. the whether NTP you - [indiscernible], it somehow or a maybe our That you - know, But sales, so IR it's

Okay. [Technical Difficulty].

Hi, Brian, Huifeng. this is

large selling for revenue we the into I about the release. the global of drove low a then, value like highlight significantly. the - total gross in press margin as QX relatively the the two that was to into count And mentioned projects. that margin all number in gross margin MSS reported You solar business gross number of project and we three of or revenue the down result

extrapolate margin not for So [ph], the Please the that the XXXX, margin it QX. hesitate as Energy then consideration. is may cod into especially be product depends reason sells - and Japan, for is to on the take guidance form or be do announced gross QX in has and it margin QX and historically very the very a confused; again, that been sometimes why the of keep that sales happened choppy coping gross we others so NPP Global we that but high. product and can into

Thank you.

very at on. it in I'll margin. pass Japan gross me, Okay. for stuff, maybe a Huifeng, last Yes, the high I can know, come one

half XX% will revenue up it But Global If of year the if in or of Global target I skewed? you XXXX? and can and to first of show cadence, take the provide range as offline earlier revenue we give project sense well. can dollar implied of in gigawatts or for sales Energy revenue X.X for Energy in versus can provide year? more is the half in is XX% balanced back that's later more the any this it know, us some you actual - Can you X.X least how the or much sense the at Just by

you slot to than numbers modeling. call. the the Brian, IR just team is have way best [ph] on rather And help guess a in I this to giving

offline. take fair enough. All it Thanks, I'll right, guys.

you. Thank

the question of question. We your the Morgan. line JP Please from next [ph] ask from have Strouss

restrictions - Yes, thank imports that used bit from to of views products? the associated but it's silicon this that hypothetical your your my for Xinjiang any high-level labor if questions. taking you of quantify point, Are the needed? there kind international silicon extent steps very are that the use what you government to can province are a at in them, some of on about And maybe of recent that to Shawn, that mitigate forced kind a on take might curious you out business being have able of what I'm much potential just headlines production of for percentage your for province. come

in labor aware Well, don't answer. concrete Mark, exists the company, I our Solar can we forced any give believe our this within never based supplier. our Canadian our issue company suppliers. forced labor is we have, information however, forced on we a you in labor, very - are And or our also, We of And in - and hypothetical not question. tolerates

be will that our question. to So, my answer

we'll how regulation local Now, local come regulation countries, up and to study from comply new the with [indiscernible]. saw if some law laws certain

is All right, Huifeng. this

high-risk plant, We in at one with our manufacturing [ph]. And at it full add being for a of safety; seen forced cylinders, facility employee have those also of polysilicon, and power that Chinese facility. to don't haven't And evidence forced sense so have facility makes who together think me believe Let from Xinjiang, do the our chemicals, employees is high them [ph]. to only facility in used other labor extremely of are in we Xinjiang. solar is not and we manager we any polysilicon six any we sensitive all pressure any subcontract, have also working labor

Thank Of course, regulation the compliance. place, we and business are climate, some in aware our will you. in if political we operate of

makes that much. hear. Okay, That's good Thank very you to sense.

to This We'd the time there like speakers. questions the the telephone are line. no further on back hand call to

thanks support. also, for you today. for thank So, joining continued us And your

is any very would your take and safe Investor healthy, and have important. stay up and care, have If set hope family Relations nice day. you please to like And or you questions call, our contact a We team. a which

Thank Ladies that for today. our conference participating. you Thank and you, conclude for does gentlemen, sir.

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