First Solar Q1 2010 Earnings Call Transcript

First Solar Q1 2010 Earnings Call Transcript
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First Solar (FSLR)

Q1 2010 Earnings Call

April 28, 2010 4:30 pm ET

Executives

Larry Polizzotto - Vice President of Investor Relations

Robert Gillette - Chief Executive Officer and Director

Bruce Sohn - President

Jens Meyerhoff - Chief Financial Officer

Analysts

Colin Rusch - ThinkEquity LLC

Christine Hersey - Wedbush Securities Inc.

Pavel Molchanov - Raymond James & Associates

Sanjay Shrestha - Lazard Capital Markets LLC

Stephen Chin - UBS Investment Bank

Satya Kumar - Crédit Suisse First Boston, Inc.

Vishal Shah - Barclays Capital

Gary Hsueh - Oppenheimer & Co. Inc.

Kelly Dougherty - Macquarie Research

Stephen O'Rourke - Deutsche Bank AG

Daniel Ries - Collins Stewart LLC

John Hardy - Broadpoint AmTech, Inc.

Steven Milunovich - BofA Merrill Lynch

Mehdi Hosseini - FBR Capital Markets & Co.

George Santana

Adam Krop - Ardour Capital

Burt Chao - Simmons

Timothy Arcuri - Citigroup Inc

Smittipon Srethapramote - Morgan Stanley

Presentation

Operator

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Good day, everyone, and welcome to the First Solar First Quarter 2010 Earnings Conference Call. This call is being webcast live on the Investor section of First Solar's website at www.firstsolar.com. [Operator Instructions] I would now like to turn the call over to Mr. Larry Polizzotto, Vice President of Investor Relations for First Solar, Inc. Mr. Polizzotto, you may begin.

Larry Polizzotto

Thank's you. Good afternoon, everyone, and thank you for joining us for First Solar's First Quarter 2010 Conference Call.

Today after the market closed, the company issued a press release announcing its first quarter 2010 financial results. If you did not receive a copy of the press release, you can obtain one from the Investors section of the First Solar website at firstsolar.com. In addition, First Solar has posted the first quarter presentation for this call, key quarterly statistics and historical data, and financial results and operating performance on the IR website. We will also be discussing this presentation during the call and webcast.

Also, an audio replay of the conference call will be available approximately two hours after the conclusion of the call. The IR replay will remain available until Monday, May 3, 2010, at 11:59 p.m. Eastern daylight time, and can be accessed by dialing (888) 203-1112 if you're calling from the United States, or (719) 457-0820 if you're calling from outside the United States and entering replay pass code 95344574.

A replay of the webcast will be available on the Investors section on the company's website approximately two hours after the conclusion of the call and remain available for approximately 90 calendar days. Investors may access the webcast on the Investors section of the company website at firstsolar.com. If you are a subscriber of FactSet or Thomson ONE, you can obtain a written transcript within two hours.

With me today are Rob Gillette, Chief Executive Officer; Jens Meyerhoff, Chief Financial Officer; and Bruce Sohn, President of First Solar. Rob will provide an overview of the company's first quarter achievements, discuss our NextLight Renewable Power acquisition and give an update on the market and business. Jens will then provide you with the first quarter 2010 operational and financial results and provide an update to guidance for 2010. We will then open up the call for questions.

During the Q&A period, as a courtesy to those individuals seeking to ask questions, we ask the participants limit themself to one question. The company has allocated approximately one hour for today's call. I want to remind you that all financial numbers reported and discussed on today's call are based on U.S. Generally Accepted Accounting Principles except that our free cash flow is a non-GAAP measure and is reconciled in the back of the presentation to operating cashflow.

Now I'd like to make a brief statement regarding forward-looking remarks that you may hear on today's call. During the course of the call, the company will make projections and other comments that are forward-looking statements within the meaning of the Federal Securities laws. The forward-looking statements in this call are based on current information and expectations, are subject to uncertainties and changes in circumstances, and do not constitute guarantees of future performance. Those statements involve a number of factors that could cause the actual results to differ materially from those statements, including the risks described in the company's most recent annual report on Form 10-K and other filings with the Securities and Exchange Commission. First Solar assumes no obligation to update any forward-looking information contained in this call, all with respect to announcements described herein.

I'd now like to mention that in the second quarter of 2010, the company will be attending the following conferences: Deutsche Bank's Clean Tech Conference in Washington D.C. on May 12, Merrill Lynch's Clean Tech Conference in New York City on June 2, Crédit Suisse's Alternative Energy Conference in Washington D.C. on June 3, and then Intersolar 2010 in Munich, Germany, June 9 through 10. In addition, First Solar will be holding our annual Shareholder Meeting on June 1 in Phoenix, Arizona.

It's now my pleasure to introduce Rob Gillette, Chief Executive Officer of First Solar.

Robert Gillette

Great. Thanks, Larry. Welcome to everyone. Thanks for joining our call.

I want to turn the attention to our Q1 performance summary on Page 6 with another strong quarter. With net sales of $568 million which is 36% growth year-over-year, our net income was $172 million or 30.3% of net revenue and our diluted EPS was $2 a share.

We turn on net assets. RONA was 23.2% on a four-quarter rolling basis which is well above our target of 20%. Cash and marketable securities were $1 billion, a $200 million increase year-over-year.

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