China-based polysilicon producer Daqo New Energy has reported its best ever financial quarter in terms of cost structure, production volume and polysilicon quality as it fully ramped annual capacity to 18,000MT.
Daqo reported that in the first quarter of 2017, its polysilicon average total production cost fell to US$8.41/kg, down from US$9.98/kg in the previous quarter and the lowest so far and the lowest in the industry for Siemens-based polysilicon production.
The company also reported a polysilicon cash cost of US$6.68/kg in the quarter, which decreased from US$7.34/kg in the previous quarter.
Average selling price (ASP) of polysilicon was US$16.66/kg in the quarter, which increased from US$14.96/kg in the previous quarter, due to increased demand.
Demand for wafers also increased in the quarter with a sales volume of 22.4 million pieces, up from 21.3 million pieces in the previous quarter.
As result of higher production, better ASP’s and demand, Daqo reported revenue of US$83.8 million in the first quarter of 2017, up 81.8% from US$46.1 million in the fourth quarter of 2016.
Gross profit was US$35.9 million, an increase of 152.8% from US$14.2 million in the previous quarter. Gross margin was 42.8%, compared to 30.7% in the previous quarter.
Dr. Gongda Yao, Chief Executive Officer of Daqo New Energy, commented: “During the quarter, we fully ramped up our Xinjiang polysilicon facility to 18,000 MT annual capacity and achieved full production. Our capacity ramp-up progressed ahead of schedule. We produced 4,927 MT of polysilicon in the first quarter of 2017, an increase of 100.6% as compared to the fourth quarter of 2016. While achieving a substantial increase in sequential polysilicon production volume, we also saw strong demand for our high quality products from our customers, and achieved the highest sales volume in the Company's history with market share gain.”
Daqo said it expected to produce 4,800MT to 5,000MT of polysilicon and sell approximately 4,200MT to 4,500MT to external customers during the second quarter of 2017. Wafer sales volume was expected to be approximately 23.5 million to 24 million pieces.
“Overall, the annual PV volume demand for this year is anticipated to be rather evenly spread between the first and the second half of the year,” added Dr. Gongda. “While the PV end market demand environment is very dynamic and may lead to polysilicon ASP volatility, we believe overall volume demand for the year is solid and healthy. Our cost leadership should help the company to weather through the market volatility.”