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8-K - SOLAR ENERTECH CORP | v210949_8k.htm |
Exhibit
99.1
Contact:
Solar EnerTech Corp.
Phone: +86-21-6886-2220
http://www.solarE-power.com
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CCG
Investor Relations
Mr. Mark Collinson, Partner
Phone : +1-310-954-1343
Email : mark.collinson@ccgir.com
www.ccgirasia.com
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For
Immediate Release
Solar
EnerTech Corp. Announces First Quarter of Fiscal Year 2011 Unaudited
Financial Results
Mountain View, CA, February 11,
2011 – Solar EnerTech Corp. (OTCBB: SOEN) (the "Company") today announced
unaudited financial results for the first quarter ended December 31,
2010.
First
Quarter 2011 Highlights:
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·
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Revenue
for the first quarter 2011 was $15.5 million, composed of $15.3 million in
solar module sales and $0.2 million in solar cell sales. This
compares to $17.7 million of sales in the same quarter a year ago,
composed of $15.3 million in solar module sales, $1.2 million in solar
cell sales and $1.2 million in resale of raw
materials.
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·
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Net
income for the first quarter 2011 increased to $5.0 million from a loss of
$3.9 million in the first quarter of the prior year. Net income
for the first quarter 2011 included $5.8 million in income from a reversal
of payroll related tax accrual and $0.7 million in non-cash stock
compensation expenses.
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SOLAR
MODULES
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|||||
Q-1
2011
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Q-1
2010
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%
Increase (Decrease)
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|||
Solar
Module Shipments
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8.0MW
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7.9MW
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1%
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Avg.
Selling Price ($ / watt)
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$1.91
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$1.93
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(1%)
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Total
module shipments increased 1% to 8.0 MW in the first quarter of fiscal year 2011
compared to 7.9 MW in the first quarter of fiscal year 2010.
Revenue
for the first quarter of fiscal year 2011 decreased 12% to $15.5 million
compared to $17.7 million in the first quarter a year ago. Revenue for the first
quarter of fiscal year 2011 was comprised of approximately $15.3 million in
solar module sales, of which more than 98% were sold to Europe and
Australia, and $0.2 million in solar cell sales. Revenue for the first
quarter of fiscal year 2010 was comprised of approximately $15.3 million in
solar module sales, $1.2 million in solar cell sales and $1.2 million in resale
of raw materials. The decrease in revenue compared to the prior year period was
driven by decreases in solar cell and raw material sales as well as the decrease
in average selling price for solar modules from $1.93 per watt in the three
months ended December 31, 2009 to $1.91 per watt in the three months ended
December 31, 2010. The decrease was partially offset by an increase in
solar module shipments from 7.9 MW in the three months ended December 31, 2009
to 8.0 MW in the three months ended December 31, 2010.
Gross
profit for the first quarter of fiscal year 2011 decreased to $1.1 million
compared to $1.9 million in the first quarter of fiscal year 2010. Gross margin
for the first fiscal quarter 2011 was 7% compared to 11% in the same prior year
period. The decrease in gross profit was primarily due to an increase in raw
material prices, specifically silicon wafer prices. Silicon wafer prices
increased approximately 24% from RMB 16.0 per piece during the three months
ended December 31, 2009 to RMB 19.9 per piece during the three months ended
December 31, 2010.
Total
operating expenses for the first quarter of fiscal year 2011 was negative $3.4
million, which included $5.8 million in income from a reversal of payroll
related tax accrual and $0.7 million in non-cash stock compensation
expenses. Excluding these non-cash items, operating expenses for the
first quarter of fiscal year 2011 were $1.7 million, or 11% of total sales. By
comparison, total operating expenses for the first quarter of fiscal year 2011
were $2.3 million, which included $0.6 million of non-cash stock
compensation expenses. Excluding
this non-cash
item, operating expenses for the first quarter a year ago were
$1.7 million, or 10% of total sales.
6
Net
income for the first quarter of fiscal year 2011 was $5.0 million, or $0.03 per
basic and diluted share, compared to a net loss of $3.9 million, or $0.04 per
basic and diluted share, for the same period in fiscal 2010. The net income in
the first quarter of fiscal year 2011 primarily resulted from the reversal of
payroll related tax accrual.
Leo Shi
Young, the Company’s Chief Executive Officer, stated, “We continued to
experience strong demand from our customer base for SolarE products during the
first quarter of fiscal year 2011. Financial results of this quarter demonstrate
the management’s confidence to steer the company towards profitability at a
challenging time when market selling prices are
falling
while material
costs continue
to rise.
The key is the quality that we have maintained and continued to improve for our
products, and the capability to meet the increasing demands from our customers
in Europe, Australia and the United States.”
“For the
quarters to come, we expect to see stronger demand in high-efficiency, high
quality products as the solar industry continues to grow more sophisticated. At
the same time we are striving to streamline our operations, reduce our costs,
and increase our market share,” concluded Mr. Young.
Financial
Position
As of
December 31, 2010, the Company’s assets included $1.7 million in cash, $6.9
million of accounts receivable, $0.9 million of prepayments primarily for the
purchase of raw materials, $5.4 million of inventories on hand and $2.3 million
of VAT and other receivables. Additionally, as of December 31, 2010, the
Company’s liabilities included $9.7 million of accounts payable, customer
advance payments and accrued liabilities and $1.5 million of short-term
loans.
As of
December 31, 2010, the Company recorded a $1.5 million liability for an
outstanding Series B-1 convertible note. The note bears interest at 6% per annum
and is due on March 19, 2012.
About
Solar EnerTech Corp.
Solar
EnerTech is a photovoltaic solar energy cell manufacturing enterprise
incorporated in the United States with its corporate office in Mountain View,
California. The Company has established a sophisticated
67,107-square-foot manufacturing facility at Jinqiao Modern Technology Park in
Shanghai, China. The Company currently has two 25MW solar cell production lines
and a 50MW solar module production facility.
Solar
EnerTech has also established a Joint R&D Lab at Shanghai University to
develop higher efficiency cells and to put the results of that research to use
in its manufacturing processes. Led by one of the industry's top
scientists, the Company expects its R&D program to help bring Solar EnerTech
to the forefront of advanced solar technology research and production. For
additional information regarding the Company, please visit http://www.solarE-power.com.
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Safe Harbor
Statement
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Statements
contained in this press release, which are not historical facts, are
forward-looking statements as that term is defined in the Private Securities
Litigation Reform Act of 1995. These forward-looking statements are based
largely on current expectations and are subject to a number of known and unknown
risks, uncertainties and other factors beyond our control that could cause
actual events and results to differ materially from these statements. These
statements are not guarantees of future performance, and readers are cautioned
not to place undue reliance on these forward-looking statements, which are
relevant as of the date of the given press release and should not be relied upon
as of any subsequent date. Solar EnerTech undertakes no obligation to update
publicly any forward-looking statements.
(Unaudited
Financial Statements on Next Page)
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7
Solar
EnerTech Corp
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Unaudited
Consolidated Statements of
Operations
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Quarter
Ended December 31,
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||||||||
2010
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2009
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|||||||
Sales
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$ | 15,507,000 | $ | 17,693,000 | ||||
Cost
of sales
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(14,391,000 | ) | (15,762,000 | ) | ||||
Gross
profit
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1,116,000 | 1,931,000 | ||||||
Operating
expenses:
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||||||||
Selling,
general and administrative
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2,351,000 | 2,218,000 | ||||||
Research
and development
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69,000 | 108,000 | ||||||
Gain
on debt extinguishment
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(32,000 | ) | - | |||||
Reversal
of payroll related tax accrual
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(5,817,000 | ) | - | |||||
Total
operating (income) expenses
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(3,429,000 | ) | 2,326,000 | |||||
Operating
income (loss)
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4,545,000 | (395,000 | ) | |||||
Other
income (expense):
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||||||||
Interest
income
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3,000 | 3,000 | ||||||
Interest
expense
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(71,000 | ) | (4,425,000 | ) | ||||
Gain
on change in fair market value of compound embedded
derivative
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202,000 | 104,000 | ||||||
Gain
on change in fair market value of warrant liability
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466,000 | 921,000 | ||||||
Other
expense
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(158,000 | ) | (132,000 | ) | ||||
Net
income (loss)
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$ | 4,987,000 | $ | (3,924,000 | ) | |||
Net
income (loss) per share - basic
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$ | 0.03 | $ | (0.04 | ) | |||
Net
income (loss) per share - diluted
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$ | 0.03 | $ | (0.04 | ) | |||
Weighted
average shares outstanding - basic
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160,416,534 | 88,256,706 | ||||||
Weighted
average shares outstanding - diluted
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171,351,607 | 88,256,706 | ||||||
8
Solar
EnerTech Corp
Consolidated
Balance Sheets
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December
31, 2010
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September
30, 2010
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|||||||
(Unaudited)
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(Audited)
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|||||||
ASSETS
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||||||||
Current
assets:
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||||||||
Cash
and cash equivalents
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$ | 1,699,000 | $ | 6,578,000 | ||||
Accounts
receivable, net of allowance for doubtful account of
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||||||||
$42,000
and $42,000 at December 31, 2010 and September 30, 2010,
respectively
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6,902,000 | 6,546,000 | ||||||
Advance
payments and other
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941,000 | 1,274,000 | ||||||
Inventories,
net
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5,392,000 | 4,083,000 | ||||||
VAT
receivable
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1,978,000 | 870,000 | ||||||
Other
receivable
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340,000 | 690,000 | ||||||
Total
current assets
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17,252,000 | 20,041,000 | ||||||
Property
and equipment, net
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8,375,000 | 8,874,000 | ||||||
Other
assets
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740,000 | 735,000 | ||||||
Deposits
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103,000 | 102,000 | ||||||
Total
assets
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$ | 26,470,000 | $ | 29,752,000 | ||||
LIABILITIES
AND STOCKHOLDERS' EQUITY
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||||||||
Accounts
payable
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$ | 6,089,000 | $ | 7,895,000 | ||||
Customer
advance payment
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979,000 | 2,032,000 | ||||||
Accrued
expenses
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2,631,000 | 2,596,000 | ||||||
Accounts
payable and accrued liabilities, related parties
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- | 5,817,000 | ||||||
Short-term
loans
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1,464,000 | 1,312,000 | ||||||
Total
current liabilities
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11,163,000 | 19,652,000 | ||||||
Convertible
notes, net of discount
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1,473,000 | 1,531,000 | ||||||
Derivative
liabilities
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207,000 | 422,000 | ||||||
Warrant
liabilities
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436,000 | 902,000 | ||||||
Total
liabilities
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13,279,000 | 22,507,000 | ||||||
STOCKHOLDERS'
EQUITY:
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||||||||
Common
stock - 400,000,000 shares authorized at $0.001 par value
171,177,443
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||||||||
and
170,338,954 shares issued and outstanding at December 31, 2010
and
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||||||||
September
30, 2010, respectively
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171,000 | 170,000 | ||||||
Additional
paid in capital
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98,411,000 | 97,656,000 | ||||||
Other
comprehensive income
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2,958,000 | 2,755,000 | ||||||
Accumulated
deficit
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(88,349,000 | ) | (93,336,000 | ) | ||||
Total
stockholders' equity
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13,191,000 | 7,245,000 | ||||||
Total
liabilities and stockholders' equity
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$ | 26,470,000 | $ | 29,752,000 | ||||
9