Attached files
| file | filename |
|---|---|
| 8-K - SUNEDISON, INC. | v200574_8-k.htm |
| EX-99.2 - SUNEDISON, INC. | v200574_ex99-2.htm |
|
MEMC
Electronic
Materials, Inc. 501 Pearl Drive (City of
O’Fallon)
Post Office Box
8
St. Peters, Missouri
63376 USA Phone: 636-474-5000
|
 For Immediate Release
MEMC
REPORTS 2010 THIRD QUARTER RESULTS
|
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| Fax: 636-474-5158 | |||
|
www.memc.com
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Highlights:
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|
·
|
GAAP
revenue of $503.1 million, up 12.2% sequentially and 62.3% versus last
year; Non-GAAP revenue of $550.8
million
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·
|
GAAP
EPS $0.08; Non-GAAP EPS $0.10
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·
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Operating
cash flow of $52.3 million
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·
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SunEdison
reached agreement to sell 70 MW Rovigo project; received 46 million Euro
in initial payment; no P&L impact in the third
quarter
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St. Peters, MO, November 1,
2010 – MEMC Electronic Materials, Inc. (NYSE: WFR) today
announced its financial results for the third quarter ending September 30,
2010.
GAAP
net sales for the quarter were $503.1 million, up 12.2% from $448.3
million in the 2010 second quarter and up 62.3% from $310.0 million in the
2009 third quarter. Non-GAAP net sales for the quarter, which
includes SunEdison deferrals required under GAAP real estate and lease
accounting, were $550.8 million. Third quarter 2010 net sales
include $21.5 million from the SunEdison business that was acquired in
November 2009. Non-GAAP net sales include $47.7 million of deferrals
required under GAAP real estate and lease accounting. See the
non-GAAP reconciliation table at the end of this press release following
the financial statement tables.
GAAP
gross profit in the quarter was $84.9 million or 16.9% of net sales, an
increase of 10.4% from $76.9 million in the 2010 second quarter and 314.1%
from $20.5 million in the 2009 third quarter.
The
company reported GAAP operating income of $9.9 million for the quarter,
compared to operating income of $3.3 million in the 2010 second quarter
and an operating loss of $66.7 million in the 2009 third quarter. Non-GAAP
operating income for the current quarter was $16.7 million, which includes
a net benefit of $6.8 million related to the SunEdison deferrals required
under GAAP real estate and lease accounting.
MEMC’s
GAAP net income for the 2010 third quarter was $17.6 million, or $0.08 per
share, compared to a net income of $13.8 million, or $0.06 per share, in
the 2010 second quarter and a net loss of $64.6 million, or $0.29 per
share, in the 2009 third quarter. Non-GAAP net income, adjusted for
SunEdison deferrals required under GAAP real estate and lease accounting
for the 2010 third quarter, was $22.0 million, or $0.10 per
share.
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-more-
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“Our
third quarter results extended our recent trend of steady
improvement,” said Ahmad Chatila, MEMC’s Chief Executive Officer.
“While our end markets are dynamic, we continue to improve our execution,
while continuing with strategic initiatives that will catalyze our growth
in 2011 and beyond.”
Segment
Operating Results
Semiconductor
Materials Operating Results
Semiconductor
Materials net sales for the 2010 third quarter were $261.1 million, an
increase of 4.6% from second quarter 2010 net sales of $249.6 million, and
an increase of 49.8% from third quarter 2009 net sales of $174.3
million. The sequential increase in sales was primarily driven
by higher pricing, and the year-over-year increase in sales was the result
of significantly higher wafer volume and higher pricing.
Segment
operating profit was $26.2 million, compared to $24.3 million in the 2010
second quarter, which second quarter included a net benefit of $8.0
million related to an insurance recovery, and a loss of $75.4 million in
the 2009 third quarter. The improved results in the 2010 third
quarter were primarily a result of higher pricing. The
year-over-year increase was driven by lower restructuring cost, better
fixed cost absorption and higher pricing.
Solar
Materials Operating Results
Solar
Materials net sales for the 2010 third quarter were $220.5 million, an
increase of 31.3% from second quarter 2010 net sales of $168.0 million and
an increase of 62.5% from third quarter 2009 net sales of $135.7
million. The sequential increase was the result of
significantly higher wafer volume and higher pricing. The year-over-year
increase was primarily driven by higher wafer volumes, partially offset by
a modest decline in pricing.
Segment
operating profit was $17.6 million in the third quarter of 2010, compared
to $19.1 million in the second quarter of 2010, which quarter included a
net benefit of $3.9 million related to an insurance recovery, and $31.0
million in the third quarter of 2009. Third quarter segment operating
profit also included $4.5 million in ramp-related loss from Solaicx, of
which $0.8 million was purchase accounting expenses related to the
acquisition. Higher wafer prices in the third quarter of 2010
fueled the profit growth over the second quarter of 2010. The
year-over-year decrease in segment operating profit was the result of
lower wafer pricing and higher external wafer tolling
cost.
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-more-
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Solar
Energy (SunEdison) Operating Results
SunEdison
GAAP net sales for the third quarter were $21.5 million, compared to net
sales of $30.7 million in the second quarter of 2010. A
year-over-year comparison is not meaningful, because SunEdison was
acquired on November 20, 2009, and historical SunEdison results are not
reflected in our consolidated financial results prior to that
time. Non-GAAP net sales for SunEdison for the 2010 third
quarter were $69.2 million, which include $47.7 million of deferrals
required under real estate and lease accounting.
SunEdison
2010 third quarter GAAP operating loss was $7.2 million, compared to an
operating loss of $4.4 million in the second quarter of 2010, primarily
driven by an increase in sale-leaseback
transactions. SunEdison’s non-GAAP segment operating loss for
the 2010 third quarter was $0.4 million.
As
previously announced, SunEdison reached an agreement to sell the 70
megawatt (MW) Rovigo project to First Reserve in September
2010. As of quarter-end, construction on the project was 66%
complete. As of October 31, 2010, construction was 75%
complete. Third quarter results, on either a GAAP or non-GAAP
basis, do not include any amounts related to the sale of the Rovigo
project.
During
the third quarter of 2010, SunEdison added 10MW of new projects to its
portfolio of energy producing assets. SunEdison ended the quarter with a
pipeline of 1,023MW, of which 155MW was under construction.
SunEdison
uses the term “pipeline” to identify solar energy systems for which SunEd
has a signed PPA contract or a secured grid connection site and completed
permitting, or document of customer intent/LOI identifying the
terms and conditions to develop the proposed transaction. “Under
construction” refers to projects within pipeline, in various stages of
completion, which are not yet operational. There can be no
assurance that projects in pipeline will be converted to completed
projects.
Corporate/Other
Corporate/other
cost was $26.7 million in the 2010 third quarter, compared to $35.7
million in the second quarter of 2010 and $22.3 million in the third
quarter of 2009. The sequential decrease was driven largely by
the timing of non-cash stock vesting and forfeitures, as well as expenses
related to the Solaicx acquisition in the prior quarter. The
year-over-year increase was largely a result of higher corporate
headcount.
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-more-
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Capital
Position
During
the 2010 third quarter, the company generated operating cash flows of
$52.3 million, compared to operating cash flow generated of $118.8 million
in the second quarter of 2010 and operating cash flow generated of $11.8
million in the third quarter of 2009. The sequential decrease in operating
cash flow was driven by higher inventory related to direct sale projects
under construction, including the Rovigo project. The year-over-year
increase was driven by more favorable accounts payable terms and an
increase in deferred revenue for solar energy systems.
Capital
expenditures were $95.8 million in the quarter, driven by investments in
polysilicon capacity expansion and internal solar wafering
capabilities.
Construction
of solar energy systems for SunEdison projects was $66.9 million in the
quarter for the construction of solar projects currently classified as
owned projects and carried as fixed assets. The funding required to
construct solar projects that are expected to be direct sales is reflected
in working capital.
Free
cash flow consumed was $28.1 million. See the GAAP
reconciliation table included with the financial statement tables at the
end of this press release.
Excluding
$69.3 million of restricted cash, MEMC ended the third quarter with cash
and investment balances of $676.9 million, including $588.1 million in
cash and cash equivalents, and $88.8 million in short-term and long-term
investments.
Non-recourse
project debt and capital leases at quarter end were $522.8 million.
Short-term borrowing under the company’s existing revolving credit
facility was $50.0 million as of quarter-end.
Outlook
Given
our financial performance year to date and the complexity and uncertainty
surrounding the timing of GAAP profit recognition related to the Rovigo
sale and other SunEdison direct sale project transactions, the company is
suspending its 2010 EPS guidance. In the 2010 fourth quarter,
the company expects strong revenue performance, the successful
completion of Rovigo funding and positive free cash flow. The
company will provide additional information, including additional
qualitative guidance for the remainder of 2010, on the conference call
today, November 1, at 5:30 p.m.
ET.
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-more-
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Use
of Non-GAAP Measures
Management
has determined that certain non-GAAP metrics for the SunEdison segment
presented herein are the key metrics that will help investors understand
the ultimate income and near-term cash flows generated by our SunEdison
business. These non-GAAP measures and metrics include deferrals
required under GAAP real estate and lease accounting for some of
SunEdison’s direct sales and or its sale-leaseback transactions. For
a complete description of our non-GAAP measures, see the non-GAAP
reconciliation table below and our Form 8-K filed today.
Conference
Call
MEMC
will host a conference call today, November 1 at 5:30 p.m. ET to discuss
the company’s third quarter results and related business matters. A live
webcast will be available on the company’s web site at www.memc.com.
A
replay of the conference call will be available from 7:30 p.m. ET on
November 1 until 11:59 p.m. ET on November 8. To access the
replay, please dial (320) 365-3844 at
any time during that period, using passcode 175068. A replay will also be
available until 11:59 p.m. ET on November 8 on the company’s web site at
www.memc.com.
About
MEMC
MEMC
is a global leader in the manufacture and sale of wafers and related
intermediate products to the semiconductor and solar
industries. Through its SunEdison
subsidiary, MEMC is also a developer of solar power projects and North
America's largest solar energy services provider.
MEMC
has been a pioneer in the design and development of silicon wafer
technologies for 50 years. With R&D and manufacturing
facilities in the U.S., Europe and Asia, MEMC enables the next generation
of high performance semiconductor devices and solar cells.
MEMC’s
common stock is listed on the New York Stock Exchange under the symbol
“WFR” and is included in the S&P 500 Index. For more
information about MEMC, please visit www.memc.com.
Contacts:
Media:
Bill
Michalek
Director,
Corporate Communications
MEMC
Electronic Materials, Inc.
(636)
474-5443
Investors/Analysts:
Kurt
Bruenning
Treasurer/Investor
Relations
MEMC
Electronic Materials, Inc.
(636)
474-5925
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-more-
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Forward-Looking
Statements
Certain
matters discussed in this press release and on the conference call are
forward-looking statements, including that in the 2010 fourth quarter, the
company expects strong revenue performance, the successful completion of
Rovigo funding and positive free cash flow. Such statements
involve certain risks and uncertainties that could cause actual results to
differ materially from those in the forward-looking statements. Potential
risks and uncertainties include concentrated project development risks
related to large scale solar projects; changes to accounting
interpretations or accounting rules; market demand for our products and
services; changes in the pricing environment for silicon wafers and
polysilicon, as well as solar power systems; the availability and size of
government and economic incentives to adopt solar power, including tax
policy and credits and renewable portfolio standards; the availability of
attractive project finance and other capital for SunEdison projects;
existing or new regulations and policies governing the electric utility
industry; historical conversion rates for SunEdison of pipeline into
completed projects will not be achieved; dependence on single and limited
source suppliers; utilization of our manufacturing volume and capacity;
the terms of any potential future amendments to our long-term agreements
with our solar wafer customers; general economic conditions, including the
ability of our customers to pay their debts as they become due; our
ability to realize the benefits of announced closing and restructurings;
our ability to maintain future growth; failure of third-party
subcontractors to construct and install our solar energy systems; customer
acceptance of our new products; the impact of competitive products and
technologies; inventory levels of our customers; supply chain difficulties
or problems; interruption of production; outcome of pending and future
litigation matters; good working order of our manufacturing facilities;
our ability to reduce manufacturing and operating costs; assumptions
underlying management's financial estimates; delays in capacity expansion
and the restructuring of our manufacturing operations across different
plants; actions by competitors, customers and suppliers; changes in the
retail industry; changes in federal or state laws governing utilities;
damage to our brand; the integration of the SunEdison acquisition, the
Solaicx acquisition and future acquisitions; changes in product
specifications and manufacturing processes; changes in financial market
conditions; changes in foreign economic and political conditions; changes
in the composition of worldwide taxable income; changes in technology; the
impact of competitive products and technologies; changes in interest and
currency exchange rates and other risks described in the company’s filings
with the Securities and Exchange Commission. These forward-looking
statements represent the company’s judgment as of the date of this press
release. The company disclaims, however, any intent or obligation to
update these forward-looking
statements.
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-tables to follow-
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MEMC ELECTRONIC MATERIALS, INC.
AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF
OPERATIONS
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(Unaudited; In millions, except
per share
data)
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Three Months
Ended
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Nine Months
Ended
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September
30,
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June 30,
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September
30,
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September
30,
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September
30,
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2010
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2010
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2009
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2010
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2009
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Net sales
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$ | 503.1 | $ | 448.3 | $ | 310.0 | $ | 1,389.1 | $ | 806.9 | ||||||||||
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Cost of goods
sold
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418.2 | 371.4 | 289.5 | 1,168.0 | 731.8 | |||||||||||||||
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Gross
profit
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84.9 | 76.9 | 20.5 | 221.1 | 75.1 | |||||||||||||||
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Operating
expenses:
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Marketing and
administration
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59.4 | 72.6 | 37.2 | 194.2 | 109.5 | |||||||||||||||
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Research and
development
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14.0 | 11.5 | 10.3 | 36.6 | 29.8 | |||||||||||||||
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Restructuring and impairment
charges
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1.6 | 1.4 | 39.7 | 4.3 | 52.0 | |||||||||||||||
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Insurance
Recovery
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- | (11.9 | ) | - | (11.9 | ) | - | |||||||||||||
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Operating profit
(loss)
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9.9 | 3.3 | (66.7 | ) | (2.1 | ) | (116.2 | ) | ||||||||||||
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Non-operating expense
(income):
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Interest
expense
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5.1 | 6.0 | 0.4 | 23.2 | 0.9 | |||||||||||||||
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Interest
income
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(0.7 | ) | (1.8 | ) | (4.9 | ) | (4.8 | ) | (22.4 | ) | ||||||||||
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(Increase) decline in fair value
of warrant
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(0.2 | ) | 6.8 | 6.3 | 11.9 | (3.7 | ) | |||||||||||||
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Other, net
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0.8 | (7.0 | ) | 0.2 | (5.6 | ) | 2.2 | |||||||||||||
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Total non-operating expense
(income)
|
5.0 | 4.0 | 2.0 | 24.7 | (23.0 | ) | ||||||||||||||
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Income (loss) before income tax
benefit and equity in earnings of joint venture
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4.9 | (0.7 | ) | (68.7 | ) | (26.8 | ) | (93.2 | ) | |||||||||||
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Income tax
benefit
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(13.6 | ) | (16.1 | ) | (6.3 | ) | (44.3 | ) | (34.9 | ) | ||||||||||
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Income (loss) before equity in
earnings of joint venture
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18.5 | 15.4 | (62.4 | ) | 17.5 | (58.3 | ) | |||||||||||||
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Equity in earnings of joint
venture, net of tax
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(0.1 | ) | - | (2.5 | ) | 7.2 | (5.8 | ) | ||||||||||||
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Net income
(loss)
|
18.4 | 15.4 | (64.9 | ) | 24.7 | (64.1 | ) | |||||||||||||
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Net (income) loss attributable to
noncontrolling interests
|
(0.8 | ) | (1.6 | ) | 0.3 | (2.9 | ) | 2.9 | ||||||||||||
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Net income (loss) attributable to
MEMC stockholders
|
$ | 17.6 | $ | 13.8 | $ | (64.6 | ) | $ | 21.8 | $ | (61.2 | ) | ||||||||
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Basic income (loss) per
share
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$ | 0.08 | $ | 0.06 | $ | (0.29 | ) | $ | 0.10 | $ | (0.27 | ) | ||||||||
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Diluted income (loss) per
share
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$ | 0.08 | $ | 0.06 | $ | (0.29 | ) | $ | 0.10 | $ | (0.27 | ) | ||||||||
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Weighted-average shares used in
computing basic income (loss) per share
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226.8 | 226.8 | 223.6 | 226.8 | 223.6 | |||||||||||||||
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Weighted-average shares used in
computing diluted income (loss) per share
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227.6 | 228.0 | 223.6 | 227.8 | 223.6 | |||||||||||||||
RESULTS
BY REPORTABLE SEGMENT
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Three
Months Ended
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Nine
Months Ended
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September
30,
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June
30,
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September
30,
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September
30,
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September
30,
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2010
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2010
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2009
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2010
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2009
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Net
sales:
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Semiconductor
Materials
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$ | 261.1 | $ | 249.6 | $ | 174.3 | $ | 730.0 | $ | 378.6 | ||||||||||
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Solar
Materials
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220.5 | 168.0 | 135.7 | 546.2 | 428.3 | |||||||||||||||
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Solar
Energy
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21.5 | 30.7 | - | 112.9 | - | |||||||||||||||
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Consolidated
net sales
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$ | 503.1 | $ | 448.3 | $ | 310.0 | $ | 1,389.1 | $ | 806.9 | ||||||||||
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Operating
income (loss):
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Semiconductor
Materials
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$ | 26.2 | $ | 24.3 | $ | (75.4 | ) | $ | 42.6 | $ | (196.0 | ) | ||||||||
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Solar
Materials
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17.6 | 19.1 | 31.0 | 48.8 | 152.0 | |||||||||||||||
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Solar
Energy
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(7.2 | ) | (4.4 | ) | - | (4.8 | ) | - | ||||||||||||
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Corporate
and other
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(26.7 | ) | (35.7 | ) | (22.3 | ) | (88.7 | ) | (72.2 | ) | ||||||||||
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Consolidated
operating income (loss)
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$ | 9.9 | $ | 3.3 | $ | (66.7 | ) | $ | (2.1 | ) | $ | (116.2 | ) | |||||||
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MEMC
ELECTRONIC MATERIALS, INC. AND SUBSIDIARIES
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CONSOLIDATED
BALANCE SHEETS
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(Unaudited;
In millions)
|
|
September
30,
|
December
31,
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|
2010
|
2009
|
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ASSETS
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Current
assets:
|
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Cash
and cash equivalents
|
$ | 588.1 | $ | 632.7 | ||||
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Restricted
cash
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47.6 | 37.4 | ||||||
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Short-term
investments
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8.0 | 85.9 | ||||||
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Accounts
receivable, net
|
251.9 | 173.3 | ||||||
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Inventories
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145.9 | 140.5 | ||||||
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Solar
energy system inventories
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133.1 | 20.3 | ||||||
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Solar
energy system inventories - consolidated variable interest
entities
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147.4 | - | ||||||
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Income
taxes receivable
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14.6 | 72.5 | ||||||
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Prepaid
and other current assets
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214.4 | 87.0 | ||||||
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Total
current assets
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1,551.0 | 1,249.6 | ||||||
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Investments
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80.8 | 297.6 | ||||||
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Property,
plant and equipment, net:
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Non-solar
energy systems, net
|
1,356.1 | 1,115.9 | ||||||
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Solar
energy systems, net
|
401.6 | 301.4 | ||||||
|
Solar
energy systems, net - consolidated variable interest
entities
|
112.7 | 43.4 | ||||||
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Deferred
tax assets, net
|
135.2 | 95.3 | ||||||
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Customer
warrant
|
7.3 | 19.2 | ||||||
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Restricted
cash
|
21.7 | 21.0 | ||||||
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Other
assets
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133.5 | 91.1 | ||||||
|
Goodwill
|
342.2 | 285.3 | ||||||
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Intangible
assets
|
61.3 | 46.7 | ||||||
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Total
assets
|
$ | 4,203.4 | $ | 3,566.5 | ||||
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LIABILITIES
AND STOCKHOLDERS' EQUITY
|
||||||||
|
Current
liabilities:
|
||||||||
|
Short-term
debt and current portion of long-term debt and capital lease
obligations
|
$ | 55.5 | $ | 5.4 | ||||
|
Current
portion of solar energy system financing and capital lease
obligations
|
48.0 | 24.6 | ||||||
|
Current
portion of solar energy system financing and capital lease obligations -
consolidated
|
||||||||
|
variable
interest entities
|
8.5 | 2.2 | ||||||
|
Accounts
payable
|
543.0 | 219.3 | ||||||
|
Accrued
liabilities
|
105.1 | 106.8 | ||||||
|
Contingent
consideration related to acquisition of SunEdison and
Solaicx
|
109.2 | - | ||||||
|
Accrued
wages and salaries
|
43.0 | 39.2 | ||||||
|
Customer
deposits
|
67.3 | 83.6 | ||||||
|
Income
taxes payable
|
19.1 | 28.0 | ||||||
|
Total
current liabilities
|
998.7 | 509.1 | ||||||
|
Long-term
debt & capital lease obligations, less current portion
|
25.8 | 25.2 | ||||||
|
Long-term
solar energy system financing and capital lease obligations, less current
portion
|
365.5 | 302.5 | ||||||
|
Long-term
solar energy system financing and capital lease obligations, less current
portion - consolidated
|
||||||||
|
variable
interest entities
|
100.8 | 56.7 | ||||||
|
Pension
and post-employment liabilities
|
48.0 | 46.6 | ||||||
|
Deferred
revenue for solar energy systems
|
70.7 | - | ||||||
|
Other
deferred revenue
|
128.3 | 109.6 | ||||||
|
Other
liabilities
|
180.7 | 310.0 | ||||||
|
Total
liabilities
|
1,918.5 | 1,359.7 | ||||||
|
Commitments
and contingencies
|
||||||||
|
Stockholders'
equity:
|
||||||||
|
Preferred
stock
|
- | - | ||||||
|
Common
stock
|
2.4 | 2.4 | ||||||
|
Additional
paid-in capital
|
545.3 | 507.4 | ||||||
|
Retained
earnings
|
2,101.0 | 2,079.1 | ||||||
|
Accumulated
other comprehensive income
|
38.6 | 33.0 | ||||||
|
Treasury
stock
|
(453.7 | ) | (453.3 | ) | ||||
|
Total
MEMC stockholders' equity
|
2,233.6 | 2,168.6 | ||||||
|
Noncontrolling
interests
|
51.3 | 38.2 | ||||||
|
Total
stockholders' equity
|
2,284.9 | 2,206.8 | ||||||
|
Total
liabilities and stockholders' equity
|
$ | 4,203.4 | $ | 3,566.5 | ||||
|
MEMC
ELECTRONIC MATERIALS, INC. AND SUBSIDIARIES
|
|
CONSOLIDATED
STATEMENTS OF CASH FLOWS
|
|
(Unaudited;
In millions)
|
|
Three
Months Ended
|
Nine
Months Ended
|
|||||||||||||||||||
|
September
30,
|
June
30,
|
September
30,
|
September
30,
|
September
30,
|
||||||||||||||||
|
2010
|
2010
|
2009
|
2010
|
2009
|
||||||||||||||||
|
Cash
flows from operating activities:
|
||||||||||||||||||||
|
Net
income (loss)
|
$ | 18.4 | $ | 15.4 | $ | (64.9 | ) | $ | 24.7 | $ | (64.1 | ) | ||||||||
|
Adjustments
to reconcile net income (loss) to net cash provided by operating
activities:
|
|
|||||||||||||||||||
|
Depreciation
and amortization
|
43.5 | 38.6 | 32.3 | 119.6 | 89.6 | |||||||||||||||
|
Stock-based
compensation
|
10.1 | 18.1 | 8.4 | 39.1 | 26.6 | |||||||||||||||
|
Impairment
charges
|
- | - | 24.6 | - | 24.6 | |||||||||||||||
|
(Increase)
decline in fair value of warrant
|
(0.2 | ) | 6.8 | 6.3 | 11.9 | (3.7 | ) | |||||||||||||
|
Change
in accounts receivable
|
32.0 | (14.3 | ) | (14.0 | ) | (76.4 | ) | 6.2 | ||||||||||||
|
Change
in solar energy system inventories
|
(189.2 | ) | (19.0 | ) | - | (262.4 | ) | - | ||||||||||||
|
Change
in accounts payable
|
145.7 | 57.7 | 4.6 | 208.5 | 9.9 | |||||||||||||||
|
Changes
in income taxes receivable and payable
|
(27.7 | ) | 49.0 | (15.8 | ) | 13.9 | (11.7 | ) | ||||||||||||
|
Deferred
revenue for solar energy systems
|
68.4 | 3.5 | - | 74.5 | - | |||||||||||||||
|
Working
capital and other
|
(48.7 | ) | (37.0 | ) | 30.3 | (92.4 | ) | (63.8 | ) | |||||||||||
|
Net
cash provided by operating activities
|
52.3 | 118.8 | 11.8 | 61.0 | 13.6 | |||||||||||||||
|
Cash
flows from investing activities:
|
||||||||||||||||||||
|
Cash
paid for acquisition, net of cash acquired
|
(73.5 | ) | - | - | (73.5 | ) | - | |||||||||||||
|
Proceeds
from sale and maturities of investments
|
38.2 | 138.8 | 17.5 | 185.0 | 131.8 | |||||||||||||||
|
Proceeds
from return of equity method investment
|
- | 77.6 | - | 77.6 | - | |||||||||||||||
|
Purchases
of available for sale investments
|
- | - | - | - | (10.9 | ) | ||||||||||||||
|
Purchases
of cost and equity method investments
|
(6.8 | ) | (10.0 | ) | - | (16.8 | ) | (71.0 | ) | |||||||||||
|
Capital
expenditures
|
(95.8 | ) | (94.9 | ) | (53.1 | ) | (236.9 | ) | (151.8 | ) | ||||||||||
|
Construction
of solar energy systems
|
(66.9 | ) | (66.8 | ) | - | (178.6 | ) | - | ||||||||||||
|
Restricted
cash
|
(14.7 | ) | 10.4 | - | (8.7 | ) | - | |||||||||||||
|
Net
payments to vendors for deposits and loans
|
(39.9 | ) | (28.0 | ) | - | (68.0 | ) | - | ||||||||||||
|
Cash
received from net investment hedge
|
(0.8 | ) | 12.4 | - | 17.7 | - | ||||||||||||||
|
Investment
in joint venture
|
- | - | (71.0 | ) | - | - | ||||||||||||||
|
Other
|
- | 2.7 | 2.8 | 0.1 | ||||||||||||||||
|
Net
cash (used in) provided by investing activities
|
(260.2 | ) | 42.2 | (106.6 | ) | (299.4 | ) | (101.8 | ) | |||||||||||
|
Cash
flows from financing activities:
|
||||||||||||||||||||
|
Net
repayments of customer deposits
|
||||||||||||||||||||
|
related
to long-term supply agreements
|
(1.1 | ) | (0.1 | ) | (10.1 | ) | (28.8 | ) | (90.2 | ) | ||||||||||
|
Principal
payments on long-term debt
|
- | (2.7 | ) | - | (3.0 | ) | (3.2 | ) | ||||||||||||
|
Proceeds
from financing obligations
|
50.0 | - | - | 50.0 | - | |||||||||||||||
|
Proceeds
from solar energy system financing and capital lease
obligations
|
85.2 | 33.8 | - | 191.8 | - | |||||||||||||||
|
Repayments
of solar energy system financing and capital lease
obligations
|
(2.9 | ) | (12.2 | ) | - | (18.7 | ) | - | ||||||||||||
|
Common
stock repurchased
|
- | (0.3 | ) | - | (0.3 | ) | (15.8 | ) | ||||||||||||
|
Proceeds
from issuance of common stock
|
- | - | 0.1 | - | 0.6 | |||||||||||||||
|
Proceeds
from non-controlling interests
|
0.3 | 4.3 | - | 10.0 | - | |||||||||||||||
|
Excess
tax benefits from stock-based compensation arrangements
|
- | - | 0.1 | - | 0.3 | |||||||||||||||
|
Debt
financing fees
|
(0.1 | ) | (2.4 | ) | - | (9.1 | ) | - | ||||||||||||
|
Net
cash provided by (used in) financing activities
|
131.4 | 20.4 | (9.9 | ) | 191.9 | (108.3 | ) | |||||||||||||
|
Effect
of exchange rate changes on cash and cash equivalents
|
11.6 | (6.3 | ) | 7.0 | 1.9 | 0.4 | ||||||||||||||
|
Net
(decrease) increase in cash and cash equivalents
|
(64.9 | ) | 175.1 | (97.7 | ) | (44.6 | ) | (196.1 | ) | |||||||||||
|
Cash
and cash equivalents at beginning of period
|
653.0 | 477.9 | 889.9 | 632.7 | 988.3 | |||||||||||||||
|
Cash
and cash equivalents at end of period
|
$ | 588.1 | $ | 653.0 | $ | 792.2 | $ | 588.1 | $ | 792.2 | ||||||||||
|
MEMC
ELECTRONIC MATERIALS, INC. AND SUBSIDIARIES
|
|
SUPPLEMENTAL
INFORMATION
|
|
(Unaudited;
In millions)
|
|
SUMMARY OF GAAP DEBT
OUTSTANDING
|
September
30,
2010
|
|||||||
|
Consolidated
|
||||||||
|
Short-term
borrowings
|
$ | 50.0 | ||||||
|
Materials
Business - Bank debt and capital lease obligations
|
28.3 | |||||||
|
SunEdison
- Debt
|
3.0 | |||||||
|
SunEdison
- Current portion of non-recourse system financing debt and capital lease
obligations
|
56.5 | |||||||
|
SunEdison
- Non-recourse system financing debt and capital lease obligations, less
current portion
|
466.3 | |||||||
|
Total
|
$ | 604.1 | ||||||
|
NON-GAAP RECONCILIATION OF FREE CASH
FLOW
|
Three
Months Ended
|
|||||||
|
September
30,
|
September
30,
|
|||||||
|
2010
|
2009
|
|||||||
|
Net
cash provided by operating activities
|
$ | 52.3 | $ | 11.8 | ||||
|
Capital
expenditures
|
(95.8 | ) | (53.1 | ) | ||||
|
Construction
of solar energy systems
|
(66.9 | ) | - | |||||
|
Proceeds
from solar energy system financing and capital lease
obligations
|
85.2 | - | ||||||
|
Repayments
of solar energy system financing and capital lease
obligations
|
(2.9 | ) | - | |||||
|
Free
cash flow
|
$ | (28.1 | ) | $ | (41.3 | ) | ||
|
Generally
Accepted Accounting Principles (GAAP) is the term used to refer to the
standard framework of guidelines for financial accounting and reporting.
In addition to reporting financial results in accordance with GAAP, we
have provided a non-GAAP financial measure for free cash flows which we
believe is useful to help investors better understand the capital
intensity of our business, including our project financing operations. In
addition to other key performance indicators, we evaluate the performance
of the solar project business on the cash generation abilities of the
projects, which are typically financed at the inception of the leases,
resulting in a gain on sale that is deferred and not immediately included
in net income. Any non-GAAP measure should be considered in context with
the GAAP financial presentation and should not be considered in isolation
or as a substitute for GAAP net
earnings.
|
|
MEMC
ELECTRONIC MATERIALS, INC. AND SUBSIDIARIES
|
|
SUPPLEMENTAL
INFORMATION
|
|
(Unaudited;
In millions except per share
data)
|
|
Three
months ended
|
Nine-months
ended
|
|||||||
|
September
30, 2010
|
September
30, 2010
|
|||||||
|
Non-GAAP
Financial Measures [A]
|
||||||||
|
Non-GAAP
net sales
|
$ | 550.8 | $ | 1,466.5 | ||||
|
Non-GAAP
operating income
|
16.7 | 11.3 | ||||||
|
Non-GAAP
net income
|
22.0 | 30.5 | ||||||
|
Non-GAAP
fully diluted income per share
|
0.10 | 0.14 | ||||||
|
Reconciliations of GAAP to Non-GAAP
Measures
|
||||||||
|
GAAP
net sales
|
$ | 503.1 | $ | 1,389.1 | ||||
|
Direct
sales [B]
|
7.4 | 17.6 | ||||||
|
Financing
sale-leasebacks [C]
|
40.3 | 59.8 | ||||||
|
Non-GAAP
net sales
|
$ | 550.8 | $ | 1,466.5 | ||||
|
GAAP
operating income (loss)
|
$ | 9.9 | $ | (2.1 | ) | |||
|
Direct
sales [B]
|
1.3 | 3.0 | ||||||
|
Cash
gain received on financing sale-leasebacks [C]
|
5.5 | 10.4 | ||||||
|
Non-GAAP
operating income
|
$ | 16.7 | $ | 11.3 | ||||
|
GAAP
net income
|
$ | 17.6 | $ | 21.8 | ||||
|
Total
SunEdison non-GAAP adjustments, net of tax [D]
|
4.4 | 8.7 | ||||||
|
Non-GAAP
net income
|
$ | 22.0 | $ | 30.5 | ||||
|
GAAP
fully diluted income per share
|
$ | 0.08 | $ | 0.10 | ||||
|
Non-GAAP
adjustments
|
0.02 | 0.04 | ||||||
|
Non-GAAP
fully diluted income per share
|
$ | 0.10 | $ | 0.14 | ||||
|
[A]
|
The
Company believes that these non-GAAP measures represent important internal
measures of performance for the SunEdison business, and better reflect
SunEdison’s income and near term cash flows. Accordingly, where
these measures are provided, it is done so that investors have the same
financial data that management uses to evaluate the operational and
financial performance of the SunEdison business unit. MEMC management uses
these measures to manage the SunEdison business because it believes these
measures are more representative of the operational health and performance
of that business. These non-GAAP measures should not be
considered as a substitute for, and should only be read in conjunction
with, measures of financial performance prepared in accordance with GAAP
and the reconciliation of each non-GAAP measure to the directly comparable
GAAP measure set forth in the press release.
|
|||||||||
|
[B]
|
Adjustment
relates to revenue from direct sales of solar energy systems where we have
received upfront partial payments and absent real estate accounting
requirements, we would have recognized revenues under the percentage of
completion accounting method. To the extent applicable in the
future, non-GAAP revenues may also include revenue and/or profit deferred
related to SunEdison’s maximum exposure for power warranties, system
uptime guarantees and breach of contract provisions offered to the direct
sale customers for these systems that are considered continuing
involvement by SunEdison in the sold solar energy systems. This
revenue is not recognized as of the reporting date under GAAP real estate
accounting rules because the solar energy systems are considered integral
to the real estate on which they were built. Absent real estate
accounting requirements, deferred revenues related to continuing
involvement would be recognized under GAAP during the reporting period
because SunEdison has historically experienced minimal losses related to
these guarantees. For these direct sales, the sales contracts
have been executed and SunEdison has either received payment in full or
maintains a valid and legal note receivable for the full sales price that
SunEdison expects to collect within a short period after completion of the
project.
|
|||||||||
|
[C]
|
Adjustment
relates to revenue from SunEdison sale/leaseback transactions. This
includes cash received for the legal sale of the solar energy system to
the purchaser that will not be recognized as revenue under
GAAP. Non-GAAP operating income includes the upfront cash
margin in an amount equal to the difference between (a) the cash received
as of the reporting date from SunEdison’s financing partners in
sale-leaseback transactions considered financings and (b) SunEdison’s
total costs to construct the solar energy systems sold under the
sale-leaseback transactions. These sale-leaseback transactions
are classified as financing transactions under GAAP because the system is
considered integral to the land or building on which it resides and
because SunEdison has continuing involvement with the system through a
purchase option. This system development margin will be
recognized under GAAP upon termination of the related lease because the
present value of the lease payments are less than the amount recorded as
debt.
|
|||||||||
|
[D]
|
Income
tax has been calculated using the estimated incremental tax rate for MEMC
in the jurisdictions giving rise to the operating income
adjustment.
|
|||||||||