Daqo New Energy (DQ) Q1 2023 Earnings Call Transcript

For the period ending March 31, 2023

April 27, 2023 7:00 a.m. ET

Prepared Remarks

Questions and Answers

Call Participants

Prepared Remarks:

Operator

Good day and welcome to the Daqo New Energy First Quarter 2023 Results Conference Call. All participants will be in a listen-only-mode. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference to Kevin He, Investor Relations for the company. Please go ahead.

Kevin He

Hello, everyone. I am Kevin He, the Investor Relations of Daqo New Energy. Thank you for joining our conference call today. Daqo just issued its financial results for the first quarter of 2023, which can be found on our website at www.dqsolar.com. To facilitate today’s conference call, we have prepared a PPT presentation for your reference, which also can be – which also you can find in our website. Today, attending the conference call, we have our CEO, Mr. Longgen Zhang; and CFO, Mr. Ming Yang; and myself.

So today, before we begin the formal remarks, I would like to remind you that certain statements on today’s call, including expected future operational and financial performance and industry growth are forward-looking statements that are made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those contained in any forward-looking statements. Further information regarding these and other risks is included in the reports or documents we have filed with or furnished to the Securities and Exchange Commission. These statements only reflect our current and preliminary view as of today and maybe subject to change. Our ability to achieve these projections is subject to risks and uncertainties.

All information provided in today’s conference call is as of today and we undertake no duty to update such information, except as required under applicable law. Also during the call, we will occasionally reference monetary amounts in U.S. dollar terms. Please keep in mind that our functional currency is the Chinese RMB. We offer these translations into U.S. dollars solely for the convenience of the audience.

Now, without any further ado, I now will turn the call to our CEO, Mr. Longgen.

Longgen Zhang

Thank you, Kevin. Good evening or good morning everyone. Our efficient operation of polysilicon facilities in the first quarter of 2023 resulted in the production volume of 33,848 metric tons. Our production cost decreased by 5.5% in Renminbi terms primarily due to a reduction in the procurement cost of metallurgical-grade silicon powder. For the quarter, we generated $490 million in EBITDA with strong operating cash flow and maintained a healthy balance sheet. Our cash balance further improved to $4.1 billion and our combined cash and bank note receivable balance reached $4.9 billion.