晶科能源 (JKS) 2022 Q1 法說會逐字稿

Hello, ladies and gentlemen, and thank you for standing by for JinkoSolar Holding First Quarter 2022 Conference Call. (Operator Instructions) As a reminder, today's conference call is being recorded.

I would like now to turn the meeting over to your host for today's call, Ms. Stella Wang, JinkoSolar's Investor Relations. Please proceed, Stella.

Thank you, operator. Thank you, everyone, for joining us today for JinkoSolar's first quarter 2022 earnings conference call. The company's results were released earlier today and available on the company's IR website at www.jinkosolar.com as well as on Newswire services. We have also provided a supplemental presentation for today's earnings call, which can also be found on the IR website.

On the call today from JinkoSolar are Mr. Li Xiande, Chairman of the Board of Directors and Chief Executive Officer of JinkoSolar Holding Co., Ltd.; Mr. Gener Miao, Chief Marketing Officer of Jinko Solar Co., Ltd.; Mr. Pan Li, Chief Financial Officer of JinkoSolar Holding Co., Ltd.; and Mr. Charlie Cao, Chief Financial Officer of Jinko Solar Co., Ltd. Mr. Li will discuss JinkoSolar's business operations and company highlights, followed by Mr. Miao, who will talk about the sales and marketing. And then Mr. Pan Li, who will go through the financials. They will all be available to answer your questions during Q&A session that follows.

Please note that today's discussion will contain forward-looking statements made under the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. Forward-looking statements involve inherent risks and uncertainties. As such, our future results may be materially different from the views expressed today. Further information regarding this and other risks is included in JinkoSolar's public filings with the Securities and Exchange Commission. JinkoSolar does not assume any obligation to update any forward-looking statements, except as required under the applicable law.

It is now my pleasure to introduce Mr. Li Xiande, Chairman and CEO of JinkoSolar Holding. Mr. Li will speak in Mandarin and I will translate his comments into English. Please go ahead, Mr. Li.

(foreign language)

[Interpreted] Leveraging our competitive advantages in supply chain management and our global network, we delivered solid results in the first quarter of 2022 with total revenues of RMB 14.8 billion, an increase of 86% year-over-year and quarterly shipments up by 57% year-over-year to 8.4 gigawatts. Despite a very challenging environment due to macroeconomic uncertainties and supply chain disruptions from the resurgence of COVID-19 in many parts of the world, we continued to improve our in-house cost structure and our gross profit in the first quarter, increased by more than 60% year-over-year.

(foreign language)

[Interpreted] Polysilicon prices and shipping costs remained high and volatile during the quarter. Since March, the surge in local COVID-19 cases in China triggered epidemic prevention and containment policies. This has led to logistics congestion and sharp reductions in transport capacity, further affecting the timeliness of materials and finished product deliveries and increasing cost pressures for many enterprises. To mitigate the risks and production uncertainties caused by the pandemic, we took early actions to ensure ample supply of new materials, as well as close cooperation and coordination of production, supply chain and sales department in order to meet production and delivery timelines.

(foreign language)

[Interpreted] In China, deliveries for some projects were to some extent delayed due to the slight imbalance and logistics disruptions as a result of COVID-19 resurgence in certain parts of the country. However, domestic demand has remained solid. Since the beginning of 2022, many Chinese provinces have issued time-of-use tariff policies, which have further stimulated demand for distributed generation, especially for systems designed for the industrial and commercial sectors.

For utility projects, consistently high prices along the slight trend convinced some of the customers to not wait any longer to start new projects. During the quarter, the number of biddings for large-scale projects grew gradually and by the end of March, the bidding business for more than 50 gigawatts of such projects had been completed.

In Europe, the Russia-Ukraine war has largely boosted demand for solar energy and incremental demand is expected to be released within the year and will steadily increase over time. In addition, with the low carbon meter nature and economists of scale of PV, the demand for distributed generation will rapidly increase in countries with a high proportion of gas-fired power and thermal power in their energy mix. We remain confident and optimistic about the year's outlook with the total global installations expected to reach about 250 gigawatts.

(foreign language)

[Interpreted] In short, we believe that the impact of the pandemic on production and operations is temporary and under control. The PV industry's resilience in the face of volatility and fluctuations has been increasing. With the gradual recovery of logistics and the gradual release of polysilicon, we are confident about the gradual recovery of the industry and the growth in shipments and installations. We reiterate our guidance on total shipments, which remains unchanged for the full year of 2022.

(foreign language)

[Interpreted] Let's move on to our N-type R&D and commercialized the mass production sectors of our business. We continue to lead the industry in both areas of technical development and mass production volumes. Currently, over 16 gigawatts of N-type TOPCon cell capacity in Hefei and Jianshan is ramping up smoothly with mass produced cell conversion efficiency exceeding 24.6%. We are consistently investing in technology for new cell structure upgrades and new metallization methods to increase efficiency and reduce costs. Recently, we set a new world record for our N-type TOPCon cell with maximum conversion efficiency reaching 25.7%. At the same time, we are also performing iterations on the N-type cell technology platform to optimize and apply the latest technology for mass production and achieve technical leadership among our peers.

(foreign language)

[Interpreted] As the prominence and benefits of the N-type module growth, we have been seeing wider acceptance and increasing demand from global customers for our entire products. We are confident about ramping up to full capacity and increase sales for the Tiger Neo modules, giving us the advantage of growing our massive share and increase in profits. In addition, we are optimistic on China's demand and are expanding our resources and local deployment to grow in the domestic market for DG business in China at present, all our efforts on building different channels are already seeing readouts. In future, we will further coordinate our market strategy, pricing systems and brand development. We believe this will give us technical advantages in the distributed generation sector and bring low carbon, reliable and highly economical products and solutions to our customers.

(foreign language)

[Interpreted] We have successfully ramped up the 16 gigawatts of N-type cells production capacity. Taking into account our advantages, the N-type cells and strong market demand, we plan to invest in the second phase of N-type cells with a total production capacity of approximately 16 gigawatts. The increase in N-type cell production capacity will further optimize our production, infrastructure and to reduce integration costs. As a result, we are increasing our full year guidance. At this time, we are expecting the annual production capacity of mono wafer solar cells and modules to reach 55 and 60 gigawatts respectively by the end of 2022.

(foreign language)

[Interpreted] Before turning over to Gener, I would like to go over our guidance for the second quarter of 2022. We expect the total shipments to be in the range of 8.5 to 9.5 gigawatts for the second quarter of 2022.

Thank you, Mr. Li. Module shipments in the first quarter were up approximately 8 gigawatts and less than 400 megawatt of wafers and cells are sold in China additionally. By the first quarter, our accumulated global module shipment has surpassed 100 gigawatts, thus becoming the first company in the industry to achieve this historic milestone. Regarding regional landscape, Europe, Asia Pacific and emerging markets were the regions with the most shipments. In terms of absolute numbers, our shipments to Europe increased by more than 30% quarter-over-quarter and our shipments in China nearly tripled year-over-year.

In Europe, the Russia-Ukraine war boosted solar demand and it is expected to grow steadily in the future. The high demand of distributed generation, combined with successive bids for large-scale projects continue to demonstrate strong growth momentum in the Chinese market. Although deliveries for some domestic projects has been delayed due to logistic restrictions caused by the resurgence of COVID-19 and supply chain disruptions, we are still bullish on China's market demand and are moving forward with our trends to enhance deployment in China.

As a responsible global enterprise, we advocate the freedom of trade. We believe our competitive products and professional services are key to envision a wide adoption of clean and green energy on a global scale. In the U.S., policies have temporarily disrupted the market and the short-term supply becomes difficult, but we remain bullish about the market potential in the long term. Therefore, we have been proactively deploying and working with all parties to come up with a feasible solution.

The wafer cell module capacity of our integrated production facilities overseas have been ramping up very smoothly. With a sound and a comprehensive overseas supply chain, we are confident in our ability to flexibly respond to the changes in the U.S. market. In terms of contracts, we have high visibility for the full year's order book. Global customers are increasingly interested in our Tiger Neo products. We are confident about ramping up production to full capacity and sell out the Tiger Neo series. We hope N-type product will contribute more than 20% of our total shipments.

In the face of market and the price fluctuations, demand for distributed generation remains strong. We have proactively expanded our global market share in DG, for example, in Europe, APAC and emerging markets. The proportion of distributed generation in our shipment is expected to be in the range of 35% to 40% this year. And we expect that the proportion will steadily grow quarter-over-quarter. In terms of product mix, the proportion of our Tiger Pro 182-millimeter large-sized product has already exceeded 80% in the first quarter and is expected to exceed 90% in the whole year.

Recently, we launched a new series of BIPV products covering 3 major application scenarios, including facades, industrial and commercial rooftops and residential rooftops. With high efficiency N-type technology adopted those new and innovative products will provide customers with high-quality and green building solutions.

To conclude, we remain optimistic about the global PV demand in 2022, complicated by dedicated future for global marketing network, as well as vertical integrated overseas supply chain advantage, we are confident about delivering the most competitive products and services to customers and further improve our market share.

With that, I will turn it over to Pan.

Thank you, Gener. For the first quarter of 2022, total revenues increased significantly year-over-year, as a result of strong shipment growth and competitive module prices. To mitigate the impact of higher raw material prices, we strengthened our supply chain management, nevertheless, gross margin decreased both sequentially and year-over-year as we ramp up capacity of more cost effective N-type modules and increased sales of premium N-type products, we expected a strong recovery and improvement in profitability for the coming quarters.

Let me go into more details. Total revenue was $2.33 billion, a significant increase of about 86% year-over-year, gross margin was 15.1% compared with 16.1% in the fourth quarter last year and 17.1% in the first quarter last year. Total operating expenses were $344.8 million, basically flat sequentially by the significant increase year-over-year.

Logistic constraints in many parts of the world drove up shipping costs, increasing sales expenses. To mitigate this, we flexibly adjusted shipping arrangement domestically and overseas as the market conditions and we're able to benefit from several strategic agreements with major shipping companies. We also particularly adjusted to other means of transport in order to reduce the impact of shipping costs on profitability.

Total operating expenses accounted for 14.8% of total revenues in the first quarter this year, up from 13% in the fourth quarter and down from 15% in the first quarter of last year. We'll continue to control operating expenses. And as revenues continue to grow as we scale up, we expect that the operating expense ratio will gradually decrease. EBITDA was $126 million compared with $183 million in the fourth quarter last year.

Net income attributable to JinkoSolar Holding's ordinary shareholders was $4.6 million, resulting in diluted earnings per ADS of $0.10. The change in fair value of convertible senior notes due to an increase in the company's stock price in the fourth quarter this year led to a loss of $16.6 million. Our foreign exchange hedging mechanism has proven to be effective. In the first quarter of 2022, we realized a net foreign exchange gain, including change in fair value of foreign exchange derivatives of approximately $12 million compared with a net loss of [$1.685 million] in the fourth quarter last year. We will continue our strategies to hedge against foreign exchange risk.

Moving to the balance sheet. At the end of the first quarter, the company had cash and cash equivalents of $2.66 billion, up from $1.4 billion at the end of fourth quarter and $1 billion at the end of first quarter last year. Our cash position has significantly improved and we will continue to strengthen our liquidity. AR turnover days were 66 days in the first quarter compared with 52 days in the fourth quarter last year. Inventory turnover days were 117 days in the first quarter this year compared with 88 days in the fourth quarter last year.

Total debt was $4.33 billion at the end of the first quarter of 2022 compared with about $4 billion at the end of fourth quarter last year. Net debt was 1.6 billion compared with 2.56 billion at the end of fourth quarter last year. After the listing of the Jiangxi Jinko earlier this year, our finance structure is expected to improve with access to competitive financing.

This concludes our prepared remarks. We are now happy to take your questions. Operator, please proceed.

(Operator Instructions) We have a first question from Philip Shen from ROTH Capital. (Operator Instructions) I have a question from Alan Lau from Jefferies.

And I had a couple of questions. So we have -- we note that for the Asia subsidiary of the company, they had issued a preliminary first quarter results, which indicates a net profit of around RMB 400 million. This number has -- is quite different from the net profit at the U.S. level. So, we have also noted that the company has no longer issued the non-GAAP income, which have excluded the changes in fair value of these compares. So I would like to know how to compare the profit levels? What is the difference between the profit levels in these 2 entities and what is the more fair estimates of the like core profits of the U.S. level?

And this is Charlie speaking. And there's -- in terms of net income cancellations, basically, the JinkoSolar Holding, its holding companies reported under the U.S. GAAP and the subsidiaries the Asia is reported under on PRC GAAP. And one of the most significant difference is the holding company only have, let's say, 58%, right, of the Asia of the companies.

On top of that, the holding companies had a convertible bonds, which had, I think, a loss because of fair value triggering from the ADS sales is up during this first quarter. And on top of that, there's -- I assume there's some GAAP differences and -- except for that, there are also some, let's say -- the holding companies have some international projects. So, I think, in fact, your question, the big difference is because of the holding the difference of the 58% of the underlying Asia. On top of that, convertible bonds is a big change because of the increase of the share price. And there are some small differences because of the GAAP reporting differences, as well as some international party assets.

Understood. And my second question is about the investment in polysilicon with Tongwei and also Xinte. So I would like to know, would that be material contribution and profits because we have seen that in other companies. So, I wonder if that will materialize later in -- in later quarters of this year. What is the magnitude of that amount?

Okay. So it's -- so the answer is no. We don't expect any income or investment income in the future because we did have arrangements with TBA. We invested 9% of equities for the polysilicon plant and which has the capacity, I think, 10,000 tons, and we hold 9% of equity and invested around, I think, RMB 300 million. From the accounting perspective, because we don't -- we only have 9%, it's a very small minority, and we recorded under the cost method.

And if we hold, let's say, over 20%, we can pick up the net income from the accounting perspective. And we -- on top of that, we also have arrangement with the Tongwei polysilicon and we have -- we plan to have 1%. So, it's the same situation, and we -- from an accounting perspective, we are not record, let's say, investment income unless the underlying -- let's say, the subsidiaries declared dividends.

So it's basically because of cost method. Okay. So my last question is about the increased capacity guidance. So, I would like to know how much of shipment has been materialized in the first quarter for the N-type TOPCon or how much of orders have been secured for like second quarter for the N-type products because I suppose the amount is huge that the company is confident that spans capacity for another 16 gigawatt. Isn't it?

Sure, sure. For the N-type, the new capacity is 16 gigawatts, the large-sized N-type TOPCon capacity is under ramping up stage. The output is very small and were small in the first quarter and are expected to reach to full capacity by the end of the second quarter. So the first quarter, we didn't have the shipments from the new capacity. And from the order perspective, it's very attractive from the customer perspective. We are confident we are able to ship over 10 gigawatts shipments for the full year. And I think first -- second quarter may take 10%, 15%. And the second half of year is taking up around 85%, 90%.

(Operator Instructions) We have a following question from William Grippin from UBS.

Just curious if you could help us understand any initial impact you're seeing from the ongoing antidumping countervailing tariff investigation in the U.S. and how that's impacted your plan and potential future shipments as of now?

So Gener, would you like to take the question?

Okay, Sure. Let me take that one. For the anti-circ investigation, yes, it is impacting the whole industry a lot, right? So because the potential risk of retroactive tariffs even the potential -- the higher end of the range of the possible tariffs might put a lot of uncertainty for the manufacturer side. That's why many factories and peers choose to take a stop and to wait to see the consequence or the announcement from the U.S. government side.

And for Jinko, I think we have established a vertical integrated supply from a wafer on to cell on a module together with long-term contract we have secured with many -- quite several key -- let's say key non-China polysilicon suppliers. So combine all those factors together, I think we are -- we can or we are capable to offer one of the -- let's say one of the most comfortable and reliable solutions from the solar panel manufacturing side. That's why we have seen many positive feedback about the customers from U.S. about their strong interest to secure the supply from Jinko side. But meanwhile, we are still cautiously manage the manufacturing process to make sure that the company's risk is within the tolerance we can afford.

And just a follow-up on that. I mean, could you speak to kind of how your contracts with your customers are structured in terms of -- should there be a retroactive tariff, who's actually responsible for that? Does it vary based on your contracts? And just help us understand kind of how that works?

I don't think we are capable to disclose the details of the contract. But from the company's perspective, definitely, we can -- we cannot afford the huge potential risk of anti-circ. That's why we are reaching different solutions with different customers, some of the customers choose to ship the modules themselves, some of the customers choose to take the risk, some of the customers may choose to delay the projects, some customers may take a stop for a while until the announcement happens, so different customer has different appetite and different solutions.

(Operator Instructions) We have a next question from Philip Shen from ROTH Capital.

Sorry about the mix up earlier. I was navigating 2 earnings calls. In terms of the anti-circumvention case, I think you guys had before the anti-circ came up a clear solution to address the U.S. market that would avoid the WRO situation. And so can you talk to us about how much you're expecting to ship into the U.S. before anti-circumvention hit in 2022? And then now how much do you expect the shipments into the U.S. could be? So maybe before you're in the 3 to 4 gigawatts and maybe now you're maybe sub-500 or something. Is that directionally accurate? Just trying to get a sense for the magnitude of the change. And then if -- given that difference in the change or that delta, because you didn't change your annual guidance, where do you expect those modules to be going if it's not the U.S.? Is Europe taking up the slack?

Thank you, Phil. For that, I think Jinko is one of the early victim of the WRO. We got disrupted I think by second half of last year. So, that's why we have prepared several solutions to make sure we can find our ultimate supply solutions to the U.S. market. That's why currently our wafer capacity in Vietnam is ramping up smoothly. And we believe we could be very -- we could offer a very unique solution to the U.S. market. And to quantify that -- quantify for the volume, it's still difficult to tell because the logistics is not very, let's say, predictable as the current status, especially considering the customer clearance timing is totally out of our control as well. So I -- sorry to say, but we don't have a very detailed number to disclose before the anti-circ case investigation starting. But in general, our current capacity ramping up plan is still on schedule and smooth and we are expecting to supply U.S. market with our unique solution very soon.

And the second question for the guidance, we still are bullish about the global demand this year, especially for U.S. -- after the U.S. got the hit by this anti-circ thing, we have seen this European demand is booming rapidly and strongly. Together with the China demand picking up, we believe that's quite a lot in terms of demand. So, I think that will be good enough to cover the loss we had in U.S. market earlier this year.

Okay. Shifting gears to Q2, you gave some guidance there. I was wondering if you could talk through the margin outlook. Do you expect with the pricing power of module pricing going higher -- and just pricing through the whole supply chain going higher, is there any chance that you could expand margins in Q2? Or is there a risk that it can contract? Or do you expect it to be flat in Q2?

So Pan, would you like to take the question?

This is Pan. For Q2, we expect the gross profit margin would be stable.

Okay. stable versus Q1, Pan.

Yes. Versus Q1 this year.

Great. Okay. And then in terms of the dividend that you guys talked about, the dividend at the shareholders for the ADR, since you guys received it from the subsidiary, do you expect to pay out to do a buyback? Or do you -- is there a chance that you just keep it? Or what's the -- can you talk through the plans a little more? Sorry if somebody addressed this earlier, again, I was now beginning 2 calls earlier.

Okay. For the dividend, it's not a big number. It's a small number. And we're expecting to receive the dividend after paying the tax, I think in late May, and we didn't -- we haven't taken the position how we are using the dividends and we may discuss with the board and make the decision later.

Okay. Can you talk through the options? Would you consider a buyback? Or is the -- what's on the table?

Yes, It could be -- the holding companies, we don't have any significant operating assets except for the equities for the Asia. And so, we may consider to take some investment opportunities, particularly for the solar -- for the companies which supply our equipment or the materials and which we can do the -- let's say, through the minority investment to build some ecosystem for the solar. This is one of the options. And the second option is we maybe pay dividend as well for the U.S. investors. But I think just as I talked about, it's a small number. And so, we didn't have the decision yet.

Got it. Okay. And then in terms of module pricing, can you talk about, Gener, how do you expect that to trend in Q2, Q3 and Q4? Is the idea that should we be forecasting or thinking about module pricing increasing as we get through the year? And do you think that continues into '23? Or do you think it comes back down in '23?

Thank you for the question. So, in our opinion, the module price is stabilizing. It's stabilizing in the range around the current market price, maybe up and down $0.05, $0.1, but it's more or less a stabilized range and which is broadly accepted by more and more customers and end customers day by day. The reason is we have seen a very, let's say, robust polysilicon prices from last year to this year.

And also, meanwhile, we are picking -- we have seen the demand is picking up significantly, even if there are some turbulence in U.S. market, but considering other markets, for example, China, Europe, et cetera, the market demand is still there and it's strong as well. So considering both and many projects, many customers started to adjust their plan and they don't wish to wait for the -- they don't wish for the price sharply going down overnight, they started to build up their business plan based on the current, say, module pricing or the solar system cost, which will be -- will make the whole ecosystem of solar industry more sustainable, in my opinion.

Meanwhile, Jinko's N-type product itself will provide added value to the customers, who has a very limited budget or have a very high IRR target. So, I think that give us a perfect window to promote the Tiger Neo products. And that's -- partially that's the reason why we are continuing to expand our entire capacity.

One last one. I appreciate taking all the questions. And that's on -- just a quick housekeeping question. Can you share what the Q1 cash flow from operations was?

We'll give the number back to you after the call. I think it's a positive. I cannot remember the exact numbers.

We have a last question from Brian Lee.

Sorry, I jumped on late, so I apologize if some of this has already been covered. But I guess one question on the AD/CVD circumvention investigation as it relates to your operations or your shipments into the U.S. Have you, I guess, considered or are your customers asking you about taking products -- panel products from your Mainland China operations as opposed to buying from your sites in Southeast Asia? I guess is that an option that either you're exploring or your customers are asking you about, just so they can avoid some of the uncertainty that exists around the Southeast Asian countries right now?

Thank you for the question. I think we covered that a little bit in the previous answers, but let me briefly repeat it again. So, for the customer end, I think we have -- we are experiencing many different customers' appetite about the risk about these solutions. So, I think we -- from Jinko's perspective, we are not ruling out any solutions from a customer end, but our bottom line is very clear. We are only capable to accept the risk -- very limited risk from company's position, right?

So anything beyond our tolerance, risk tolerance, we have to find out solutions. Otherwise, we prefer to stay quiet for a while like others to wait until more clarity on the tariff side. So, that's the direction we are going. And we are experiencing many different solutions again or some of them taking the goods themselves, some of them put it in a warehouse somewhere, some of them saying they want to delay, some of them saying -- just taking the product to the other markets or many different solutions. So every customer is different from one to another.

Yes. No, I can appreciate that. And I understand the situation is quite fluid and sensitive. Maybe just technically speaking, if a customer were to purchase panels from you that were shipped in from Mainland China, could you remind us, because I know these rates have changed over the years, what is your company-specific antidumping and countervailing duty tariff assessed on the Chinese-made products right now?

Yes. It's just like what you said, different companies have different separate rates. And -- but some of the rate is still ongoing. And for example, we are expecting that the (inaudible) the final rate is going to come out. But based on the preliminary rate for Jinko, the AD/CVD is roughly, I think, 50%. On top of that, we do pay 201 and 14%, 15%; and the 301, I think 25%. So, it's totally, I think 90% to 100%.

Okay. That's quite significant. -- helpful. And then last question for me. I'm sure you covered it, so apologies again, but the capacity increases here, I would assume it means there is a CapEx increase as well. What's the new CapEx budget you're outlining for 2022?

Yes. So Pan, would you like to take? The CapEx?

Okay. This is Pan. You mean the CapEx for this quarter?

Just the CapEx forecast for the full year?

Okay. And for the full year of this year, the expected CapEx would be USD 3 billion.

USD 3 billion?

Yes, exactly. Yes.

It's right, because we -- I think we got 1.5 billion through the China IPO and we're expecting to generate positive cash flows, as well as we also increased some project loans from financial institutions to build up the capacities for the next generation technology -- N-type TOPCon capacities.

Okay. But just so I'm clear, I think in March, you had said USD 1.8 billion to USD 1.9 billion, so now that's going to USD 3 billion, correct?

Yes, yes, because we increased the capacity outlook by the end of this year and up to, I think, up to 55, 55, 60 gigawatts for wafers and cell modules.

Okay. I guess this doesn't seem like -- this is the last question, I promise, and then I'll let you go. It doesn't seem like your -- this capacity increase isn't impacting your shipment guidance, which you reiterated, So this is all mainly going to be end of the year and then flow into '23. Any kind of early sense of what the growth you could anticipate in shipments for next year would be because it's a lot of CapEx and you're not getting any benefit of it in your P&L this year, it will be next year. So what's sort of the general sense of growth we should expect?

You're right, the price for, some more capacity, the new capacity starting up construction from second quarter is for the preparations next year. So, if you look at the capacity, 55, 55, 60, I think it's our range, at least, right, 55 to 60 gigawatts. And we are -- overall, I think we are optimistic for the next year. And this year, the polysilicon still at a high price and the volume -- poly volume is still relatively limited. And we believe next year with the bottleneck -- without the bottleneck of the polysilicon, where we think the market will accelerate rate again.

We have no other questions. Ladies and gentlemen, thank you very much for your participation in this conference call. You may now all disconnect.