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1Q/12 Earnings CallMay 23, 2012
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Forward-looking statement disclaimer
This presentation, and accompanying slides, contain statements regarding the Companys projectedfinancial and operating results, market opportunity and business prospects that are individually andcollectively forward-looking statements within the meaning of Section 27A of the Securities Act of 1933and Section 21E of the Securities Exchange Act of 1934. Any forward-looking statements andprojections made by others in this presentation are not adopted by the Company and the Company isnot responsible for the forward-looking statements and projections of others.
These forward-looking statements are not guarantees of future performance and are subject to knownand unknown risks, uncertainties and assumptions that are difficult to predict. Therefore theCom an s actual results levels of activit erformance or achievements could differ materiall and
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, ,adversely from results expressed in or implied by this presentation. These risks include, among others:the ability to meet shipment, revenue, gross margin, and operating margin targets; and the ability toreduce costs and capital expenditures. Such statements involve certain risks and uncertainties thatcould cause actual results to differ materially from those in the forward-looking statements.
Additional information concerning these and other risk factors is contained in the Risk Factors section
of our Annual Report on Form 20-F for the year ended December 31, 2011.
We assume no obligation to update any forward-looking information contained in this presentation.
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Agenda
Dr. Zhengrong Shi
Chairman and Chief Executive OfficerEarnings Overview and
Operations
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Andrew Beebe
Chief Commercial OfficerSales and Marketing
Overview
David King
Chief Financial OfficerFinancial Performance
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1Q/12 Financial Highlights
1Q/12 Guidance 1Q/12 Actual
Shipments -30% QoQ -27% QoQ
Revenue - $409.5M
Gross profit margin 3% - 6% 0.6%* including impactof US tariffs
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Stringent working capital management led to$65M improvement of Accounts Receivableand Inventory
Healthy cash and restricted cash position of$663.8 million
Shipments declined due to limited inventory andlow production over Chinese New Year
* Preliminary US Anti-Dumping andCountervailing Duties of $19.2 million, or 4.7% ofrevenues, impacted gross profit in 1Q/12
Excluding US tariffs, met gross margin target of
3% to 6%
Operating Loss - ($119.2M)
Net Loss - ($133.0M)
Earnings per diluted ADS - ($0.74)
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Consolidate wafer capacity to focus on
high efficiency production lines
$23M capex in 1Q/12
2012 capex of $120-$150M fore ui ment and services alread received
PV Cell and Wafer Capacity (MW)
Capacity Roadmap
2,400 2,400
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and technology upgrades
30 60150 270
540
10001100
,
500
1,600 1,600
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012ECell Capacity Wafer Capacity
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Shipment Growth
PV Shipments (MW)
1Q/12 shipments down 27% QoQ, better than guidance
of 30% QoQ decrease
2Q/12 shipments target 20% QoQ growth
2,096 2,100-2,500
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6 30 68160
364496
704
1,572
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012E
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22%19%
45%26%30%
34%
38%15%21%18%
60%
80%
100%
AmericasROW
More diversified revenue mixfrom sales channel strength & diversity
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44%43%40%
53%52%
0%
20%
40%
1Q/11 2Q/11 3Q/11 4Q/11 1Q/12
Europe
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17 national offices globally including regional HQs in
Switzerland and San Francisco
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Market Overview
Germany Revised FiT policy delayed till July/October Buoyant demand ahead of FiT reduction
Italy Ongoing transition to roof-top market Revised FiT policy delayed till 2H12
USA
Europe
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Americas
Rest of the
World
Preliminary countervailing and anti-dumping duties of 34% onSuntech cells produced in China
Due to global supply chains, hundreds of megawatts of tariff-free panels available for US customers
Japan
New FiT expected to be implemented in July 2012
Suntech #1 foreign brand in Japan
China
Expect 1.7GW of Golden Sunshine projects in 2012
Expect 3GW+ FiT supported projects in 2012
Saudi Arabia
Targets 41GW of PV and concentrated solar by 2032Page 8
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Income Statement
Revenue
$ in millions 1Q/11 1Q/12
-53%
Shipments decrease by 22% YoY
ASPs decline by 36% YoY
877.0
409.5
182.7
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Gross Profit Pricing pressure impactedgross profit
1Q/12 gross profit impacted by$19.2M US AD/CVD tariffs
OPEX 1Q/12 under-utilization charges
of $21M and provisions for baddebt and prepayments of $26M
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-99%
.
2.4
+38%
88.2121.6
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Income Statement
$ in millions 1Q/11 1Q/12 Due to lower gross profit, and
provisions for bad debt andprepayment
Improved FX and hedging
management
94.5
(119.2)
(26.6)
22.2
Income(Loss) from
Operations
Net FXIm act
+183%
-226%
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0.17(0.74)
Tax (Benefit)Expense 5.5
6.1
Diluted EPS
Certain profitable China-basedsubsidiaries taxedindependently+11%
-535%
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Balance Sheet
$ in millions 1Q/11 1Q/12
-26%
900.7
663.8
550.2
Cash +
restrictedcash
YoY capacity expansion
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-8%
.508.4
-43%
715.6
409.5
Inventory
AccountsReceivable
Stringent working capitalmanagement
Effective inventorymanagement
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Balance Sheet
$ in millions 1Q/11 1Q/12
+23%
7390
Lower revenue base in1Q/12DSO
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+22%
474.2.
+7%
1,488.2 1,599.8 Higher YoY due to capex
Increased due to marketdynamics
AccountsPayable
Net Debt
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Cash Flow
Stringent working capitalmanagement
Cash Flow
fromOperations
$ in millions1Q/11 1Q/12
+91%
(134.7)
(12.5)
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Capex
Hold capacity stable
Limited capex for equipmentand services already receivedand upgrades
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-82%
128.5
22.6
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2Q/12 2012
Shipments (MW) Up more than 20% QoQ 2.1GW 2.5GW
Gross margin 3% 6%
2Q and FY2012 Outlook andFinancial Guidance
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Capex $120M $150M
Capacity1.6GW Wafer
2.4GW Cell/Module
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2Q/12 FX Outlook
Item Guidance Sensitivity
Net FX Impact
Minimal impact based on EUR rateof 1.28USD
Net EUR exposure of EUR300M
Each 0.01 appreciation of theEUR/USD rate will lead to $3Mgain and vice versa
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Highlights 1Q/11 4Q/11 1Q/12 QoQ YoY
Total net revenues 877.0 629.0 409.5 -35% -53%
Total cost of revenues 694.3 566.7 407.1 -28% -41%
Gross profit 182.7 62.3 2.4 -96% -99%
1Q/12 Income Statement
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Operating expenses 88.2 126.5 121.6 -4% 38%
Operating income (loss) 94.5 (64.2) (119.2) -86% -226%
Net income (loss)attributable to holders of
ordinary shares
31.9 (148.8) (133.0) 11% -517%
Fully diluted EPS 0.17 (0.82) (0.74)
Fully diluted shares 182.5 180.7 181.0
Note: Amounts in millions of US Dollars or shares except for per-share data
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Highlights 1Q/11 4Q/11 1Q/12
Net cash provided by (used in)operating activities
(134.7) 253.3 (12.5)
Net cash (used in) investing
activities
(187.1) (127.6) (1.3)
Net cash rovided b used in
1Q/12 Consolidated Cash Flow
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financing activities
7. 7. .
Net increase (decrease) in cashand cash equivalents
(89.9) 34.0 (18.7)
Cash and cash equivalents
at the beginning of the quarter 872.5 458.4 492.4
Cash and cash equivalentsat the end of the quarter
782.6 492.4 473.7
Note: Amounts in millions of US Dollars
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an you
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