Canadian Solar Inc. · NASDAQ:CSIQ
Canadian Solar — Q3 2021 Earnings Presentation
17 slides from Canadian Solar's earnings presentation, Nov 18, 2021
Slide 1: Canadian Solar 3Q21 Earnings Call
Canadian Solar 3Q21 Earnings Call November 18, 2021
Slide 2: Safe Harbor Statement
Safe Harbor Statement This presentation has been prepared by the Company solely to facilitate the understanding of the Company’s business model and growth strategy. The information contained in this presentation has not been independently verified. No representation, warranty or undertaking, express
Slide 3: Carbon markets increasingly reflecting the real cost of carbon
Carbon markets increasingly reflecting the real cost of carbon European Union Emissions Trading System Carbon price implied by commodity price price, €/ton benchmarks vs. ETS markets (US$/tnCO2eq) Carbon price from Carbon price implied by commodity 180 ETS schemes benchmark’s price 160 140 120 100 8
Slide 4: Strong long term growth outlook for both solar and battery storage
Strong long term growth outlook for both solar and battery storage Solar PV cumulative installations crossing 1 TW next year, to reach 3.2 TW by 2030 Battery energy storage cumulative capacity installations crossing 100 GWh next year, to reach 1 TWh by 2030 Long term growth driven by competitive eco
Slide 5: Canadian Solar Strategic Priorities
Canadian Solar Strategic Priorities Expand global pipeline of solar & battery storage projects positioning for long term growth Expand and deepen sales channels focusing on total system solutions Grow market share while limiting investment in certain stages of the supply chain given the overcapacity
Slide 6: CSI Solar China IPO on third round of Q&A with the Shanghai Stock Exchange
CSI Solar China IPO on third round of Q&A with the Shanghai Stock Exchange 2022 • Investor roadshow • Official listing Q3-Q4 2021 • Feedback process with stock exchange and regulatory authorities Q2 2021 • Submit application to regulatory authorities & stock exchange Q1 2021 • Financial, legal p
Slide 7: Large and growing global solar and battery storage project pipeline
Large and growing global solar and battery storage project pipeline Solar Project Pipeline (September 30, 2021) – MWp Battery Storage Project Pipeline (September 30, 2021) – MWh Region Construction Backlog Pipeline Total Region Construction Backlog Pipeline Total North North 115 744 5,732 6,591 2,90
Slide 8: Solar PPAs are going up
Solar PPAs are going up Average PPA prices in North America Average PPA prices in Europe Quarterly Aggregate Price Indices – P25 Quarterly Aggregate Price Indices – P25 38 56 54 36 52 34 50 Price ($/MWh) 32 Price ($/MWh) 48 30 46 28 44 26 42 40 24 38 22 36 20 Q4’18 Q1’19 Q2’19 Q3’19 Q4’19 Q1’20 Q2’2
Slide 9: Multiple levers of growth across project sales, services and investment vehicles
Multiple levers of growth across project sales, services and investment vehicles 2020 2021 2022 2023 2024 2025 Actual 1 Development: Annual project 1.4 1.5 – 2.1 2.4 – 2.9 3.2 – 3.7 3.6 – 4.1 4.0 – 4.5 Project sales sales. GWp 2 Services: Operational O&M O&M(1) + projects, 2.2 2.6 4.3 6.5 9.2 11.0 A
Slide 10: Q3 margin continued to improve sequentially
Q3 margin continued to improve sequentially Gross margin Q3 2021 30% Shipments: 3.9 GW 20% CSI Solar revenue: $1.1 billion 10% CSI Solar gross margin: 15.1% 0% Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2019 2020 2021 CSIQ CSI Solar 10
Slide 11: Supply side cost pressures picking up again recently
Supply side cost pressures picking up again recently 1. Global logistics bottleneck 2. Material cost inflation 3. Power curtailment Module manufacturing cost change from Cost inflation of certain key materials in 2021 May to December 2021E (USD/W) 338% 332% +40% 305% 12% 3% 5% 5% 4% 74% -3% 159% 126
Slide 12: Commercial delivery of N-type HJT solar modules in Q4 and establishing TOPCon pilot cell line
Commercial delivery of N-type heterojunction (HJT) solar modules in Q4 and establishing TOPCon pilot cell line CSIQ HJT cell efficiency ramp up 24.9%+ Advantages of HJT technology Advantages of TOPCon technology • Highest conversion efficiency • Limited additional capex as can and power output utili
Slide 13: Making significant progress on our battery storage business
Making significant progress on our battery storage business Estimated revenue $220 million $400 million (approx.) MWh 1400-1500 MWh Contracted / 2,261 In Construction c. +70% Forecast 215 840-860 MWh Pipeline 2,651 0 MWh Total 5,127 2020 2021E 2022E (1) Contracted/In Construction = expected to be de
Slide 14: Quarterly income statement highlights
Quarterly income statement highlights USD millions except per share data 3Q20 4Q20 1Q21 2Q21 3Q21 qoq yoy Net revenues 914 1,041 1,089 1,430 1,229 -15% +35% -CSI Solar 921 785 695 1,184 1,149 -5% +25% -Global Energy 79 373 471 281 140 -50% +80% -Elimination -86 -117 -77 -35 -60 Gross margin 19.5% 13
Slide 15: Quarterly balance sheet highlights
Quarterly balance sheet highlights USD millions 3Q20 4Q20 1Q21 2Q21 3Q21 Cash and equivalents 1,103 1,179 981 814 868 Restricted cash 459 461 542 497 490 Short-term borrowings 1,065 1,202 1,217 867 1,083 Long-term borrowings on project assets – current 238 199 264 491 297 Capital leases – current 24
Slide 16: Guidance as of November 18, 2021
Guidance as of November 18, 2021 Q3 2021 Q4 2021 FY2021 FY2022 2021E-22E Actual Guidance Guidance Guidance yoy ∆% Module 3.9 GW 3.7 – 3.9 GW 14.4 – 14.6 GW 20 – 22 GW c. +45% Shipments Battery Storage 250 MWh 290 – 310 MWh 840 – 860 MWh 1.4 – 1.5 GWh c. +70% Shipments 350 MW Project Sales 250 – 630
Slide 17: Thank you
Cf -_ = sc CanadianSolar Thank you CSIQ Nasdaq Listed