company presentation - proinso...state of the pv market global pv installations ~8gw 2010 2011 japan...
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1
Company Presentation
November, 2008
Confidential
This presentation does not constitute an offer to sell or issue or the solicitation of an offer to buy or acquire securities of Trina Solar Limited (the “Company”) in any jurisdiction or an inducement to enter into investment activity, nor may it or any part of it form the basis of or be relied on in connection with any contract or commitment whatsoever.
The information herein has been prepared by the Company solely for use in this presentation. No
Disclaimers
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The information herein has been prepared by the Company solely for use in this presentation. No representation, warranty or undertaking, express or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or the opinions contained herein. None of the Company or any of its affiliates, advisors or representatives will be liable (in negligence or otherwise) for any loss howsoever arising from any use of this presentation or its contents or otherwise arising in connection with the presentation.
Confidential
Company Overview
The Solar Challenge
Trina Solar Strategy and Roadmap
Sales and Marketing
3
Sales and Marketing
Financial Performance
Confidential
75
150
350
2006 2007 2008
● Founded in 1997, in Changzhou, China ● 200 – 206MW module production in 2008*● $800 – 850M of revenue in 2008*● 5,000 employees worldwide** ● Listed on the NYSE under TSL ticker● One single manufacturing campus
Company Snapshot
Module Capacity
2006 2007 2008
4
Our Advantage: Vertically Integrated Business Model
* Guidance Q3 2008**End of 3Q08
Ingot Wafer Cell Module System
Confidential
Named fastest growing company in the Deloitte Technology Fast 50, China 2007
History & Milestones
IPO: 20/12/06
Trina Solar Ltd.
Built first BIPV demo house in China
Participated in first Renewable Energy
First commercial shipments
Launch of BIPV and UMG-Si module lines
Cell Supply for Partnership
with Lisa Airplanes
2006
Trina Solar Ltd.founded
Built 39 PVPlants in Tibet
Launched Ingot manufacturing
Launched Wafer manufacturing
ISO 9002 StandardTrina Solar Research Center
Renewable Energy Law in China
Launched Cell manufacturing
Reach 350MW capacity
1999 2001 2003 2005 2006 2007 20081997 2009
Proud sponsor of Espanyol Barcelona
5
Airplanes
Confidential
Trina offices in 2008
Markets with sales
BarcelonaMunichSan Francisco
(in process)Changzhou (HQ)
Shanghai
Global Footprint
China, Germany, Spain, USA,Italy, Benelux, Greece, UK,
6
Shanghai
More than 12 nationalities from 4 different continents represented within Trina Solar
Investors from USA, Europe and Asia
Italy, Benelux, Greece, UK, S. Africa, S. Korea, Czech, Norway, Austria, Australia, Canada, Portugal…
Listed on the NYSE
� Former Exec. VP of Finance of Spreadtrum (NASDAQ:SPRD) � Former Controller at one of the world's largest NASDAQ-listed
semiconductor assembly and testing companies
� 20 years of experience in supply chain and operations management � Experience as corporate VP in charge of Asia-Pacific Services at
Solectron
Jifan GaoFounder,
Chairman & CEO
Terry WangChief Financial
Officer
Sean TzouChief Operating
Officer
Experienced Management Team with Significant Indust ry and International Expertise
International Management
7
� Previous experience as a global procurement manager at BP Solar� BA in Economics, Electrical Engineering and MS in Marketing
� 21 years experience in Quality Management� Senior Manager, Former Quality Assurance at Motorola Singapore
and China
� Founder of a wireless communications company in China� Previous experience with IBM
� 18 years of management and entrepreneurial experience
� Standing Vice Chairman of the New Energy Chamber of Commerce of the All-China Federation of Industry and Commerce
Arturo HerreroVP of Sales and
Marketing
Steven ZhuVP of Procurement &
Business Dev.
Anthony ChiaVP of Quality
� 17 years manufacturing management experience in semiconductor-related industries.
� Managing Director of Wuxi Lite-On Technology
Gary YuVP of Manufacturing
Confidential
Company Overview
The Solar Challenge
Trina Solar Strategy and Roadmap
Sales and Marketing
8
Sales and Marketing
Financial Performance
Confidential
What Change Do We Need?
9
CHANGE NEEDED
A radical change is needed in the energy sector that:� Is environmentally sustainable � Is economically feasible � Offers a rapid transition (10 – 20 years) � Can be implemented immediately on a large scale� Will offer long term solutions in the energy sector� Can be implemented at the end-user level
Confidential
Today ~0.5%
“Solar energy could make a significant contribution to
reducing CO2 emissions […] & would help avoid around 3Gtns of CO2 up to 2030” * 40 min. of sun ~ 1 year of energy
Solar Is Part Of The Solution
10 *Source: Sustainability report, Sarasin Bank Nov. 2007** Based on 310MW of modules produced as of end of 2Q08, for a house consumption of 5,500kWh/year
Electricity produced from Trina Solar modules over the last 4 years could
have power 78,000 houses **
64%
Road to grid parity**
State of the PV Market
Global PV installations
~8GW
2010
2011
Japan
2009 Hawaii
Cyprus
11
Global demand in 2008: 4.7GW *
*Source: Thomas Weisel Partners LLC, Oct. ‘08** For residential systems, internal estimates
2011
2012
2013
2014
2015
Spain, Portugal
Italy, S. California
Germany
Cyprus
New York, Greece, Netherlands
PV prices must go down significantly to reach grid parity faster
Evolution of the Solar Demand
Germany
Spain
California
Italy
France
PV regulations
EEG Amendment #1 Amendment #2
R.D.42nd Royal Decree R.D. 3
Million Roof pgrm Cal. Solar Initiative
FIT #1 FIT #2
FIT #1(MW)
Source: Internal estimates12 Confidential
Emerging European PV Markets
GERMANY
32- 33 €ct 20 years
No CAP
CZECH REPUBLIC
52 €ct 20 years
Digression up to 5% per year per new systems
No CAP
NETHERLANDS
33 €ct 15 years (including annual adjustments)
CAP 2009: 15 MW
LUXEMBOURG
SLOVAKIA
45 €ct
BELGIUM
30 €ct 20 years
No CAP
FRANCE
MAIN MARKETS
EMERGING MARKETS
SECONDARY MARKETS
SPAIN
32- 34 €ct 25 years
500 MW for 2009
ITALY
36- 49 €ct 20 years
CAP: 1200 MW
Revision in 2016
GREECE
40-50 €ct 20 years
CAP: 850 MW
New draft from 2010:FIT digression & CAP elimination
LUXEMBOURG
36- 41€ct 15 years
SLOVENIA
First 5 five years 37 €ct,second 5 years 35 €ct,10 followings years 32 €ct
20 years
FIT annually adjusted to the inflation rate.
45 €ct Starting in Jan. 2009
12 years
PORTUGAL
35-65 €ct
Payment fix during 15 years (35 €ct) & 5 years (65 €ct)
CAP 150 (GM) / 50 (RF) MW
SWITZERLAND
32-60 €ct 25 years
8% annual drop for new installations from 2010
BULGARIA
38-40 €ct 12 years
Revision in 2009
CYPRUS
20-38 €ct 15 years
FRANCE
30-40 (+17 BIPV) €ct 20 years
CAP: 540 MW
Revision ini 2015
Confidential
Emerging APAC and NA Markets
SOUTH KOREA
30-40 €ct 15 yearsINDIA
19-24 €ct for on-grid system
5 Year Plan (2007-2012)
CHINA
JAPAN
Subsidies to be set in April 2009
CANADA (ONTARIO)
26 €ct 20 years
Government working on new FIT rates
USA
Net metering available in 44 states + D.C.
Tax credits
Grant programs
Loan programs
Tax exemption programsSubsidies in process, expected for 2009
AUSTRALIA
Green Australian proposal
Fit per kW/h established by the Ministry of Energy
Period: 20 years
Limit of the annual CAP: fixed per 5 years, then it can be reduced until 10% per year.
No size limitation
Draft of the proposal presented in May 2008.
Support Programs
Solar Home: Rebate of € 4 per peak watt of output.
Remote Renewable Power: Up to 50 % of the capital cost of generation
National Solar Schools: € 91,45 mill. for 8 years (750 kW/year).
Tax exemption programs
8 years Tax rebate
Confidential
Company Overview
The Solar Challenge
Trina Solar Strategy and Roadmap
Sales and Marketing
15
Sales and Marketing
Financial Performance
Confidential
Growth Strategy� Stable plant and capacity expansion � Secured silicon and non silicon supply � Strategic supplier co-location (Changzhou-Trina PV Park)
� Reduce wafer thickness and kerf loss � Increase cell efficiency � Strong process control in ingot-wafer-cell-module development� Best in class quality – top 3 TUV ranking
Main Strategic LeversTrina Solar Strategy
Strategic Focus
Technology/Quality Strategy
16
Rapid capacity and market expansion, providing best in class technology
and driving down cost
� Decrease silicon feedstock cost � Reduce non silicon material cost � Lower processing cost – benefit VERTICAL INTEGRATION
� Large diversified customer base� Active medium-size customers � Speed to market supported by integrated business model� Well developed channel strategy� Local focus to promote and manage brand
Cost Strategy
Market Strategy
Confidential
350 MW mono & multiCapacity
Module Capacity & Production Growth Main facts
Module Capacity Expansion
Module Power Range
Cell Efficiency
Wafer Thickness
180 – 240Wp
17% mono16% multi
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Wafer Thickness
Polysilicon
180µm
Secured LT contractswith 7 suppliers
Confidential
Trina Photovoltaic Park Facility Site
Strategic location alongside manufacturing
East Campus (Phases 2 and 3)
� 500MW production facility in a single location to offer increased utilization and efficiency (Phase 2)
� Increased degree of vertical integration and automation
Long-Term Expansion Plans
Phase 1
(2004-2008) Trina PV Park
Facility Site
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Integrated manufacturing capabilitiesallows better control of
cost quality yield product development� � � � cycle time�
� Strategic location alongside manufacturing campus
� Suppliers in neighbouring facilities bring benefits including cost savings
Phase 2
(2008 – 2010) Phase 3
Confidential
Technology Roadmap 2008 2010
Wafer ThicknessMono 170-180 µm 140 µm
Multi 180 µm 160 µm
Cell Efficiency (%)Mono 17% 18.5 – 20%
Multi 16% 18%
Cell Size (max. diameter)Mono 125 mm 156 mm
Multi 156 mm 156 mm
Module Power (Wp)Mono 170 – 180 220 – 260
Multi 190 – 220 200 – 240
Technology Improvement
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Module Power (Wp)Multi 190 – 220 200 – 240
IngotIncrease load of both multi and monoBetter yield output
WaferRecycle slurryReduce thicknessBetter yield
CellEnhanced process controlGreater output
ModuleExpand portfolio to from 165 to 240MWHigh quality
Silicon usageReduction of silicon usage to 6.6g/W in 3Q08
Latest Technology Improvements
Confidential
Strong Raw Material Supply Position
2008
95% feedstocksecured for 200-206 MW
output
2009
Medium, Short & Long-Term Contracts
Approximately 320 MW through
long-term contracts
Short & medium-term
contracts required are
TBD
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Well planned long-term contracts can further enhanc e our overall cost structure
2008 to 2015
2009 to 2015
2009 to 2013
2008 to 2013
2009 to 2014
Delivery from
2009: Lower contracted silicon prices and continued manufacturing cost reduction is expected to exceed reduction in module average selling prices
Products And Certificates
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Multicrystalline200 – 240W
Monocrystalline165 – 230W
BIPV160 – 220W
- Size: 72, 60 and 48 cells- High Efficiency Cells- Plug & Play Connectors-5 years warranty for
Manufacturing defects- 10/25 years warranty for
90/80% power production
- Size: 60 or 48 cells- 3 Bus Bar configuration- Plug & Play Connectors- 5 years warranty for Manufacturing defects- 10/25 years warranty for 90/80% power production
- Size: 60 cells- Upgraded Metallurgical
grade silicon - 2 years warranty for
Manufacturing defects- 10/20 years warranty for
90/80% power production
- 2 product types: glass-glass laminated and integrated unit glass)
-Size: 72 and 60 cells- minimizes power loss
during transmission- Aesthetically pleasing
NEWUMg-Si
190 – 220W
NEW
Confidential
Company Overview
The Solar Challenge
Trina Solar Strategy and Roadmap
Sales and Marketing
22
Sales and Marketing
Financial Performance
Confidential
Customer Focus
Wholesalers and
Distributors
PV System Integrators /
Large installers
� Large diversified customer base
� Active medium-size customers
� Speed to market supported by integrated business model
Manage Brand RecognitionIncreased Influence Over End Customer
Market Strategy
23
Large installers
Brand DevelopmentPV System
Owners and Financiers
Solid position in: Spain, Italy and GermanyStrong development in: France, Benelux, Czech, Portu gal
Entry into: US, Korea, Greece & Australia
business model
� Well developed channel strategy
� Local focus to promote and manage brand
Confidential
Germany34%
Italy 19%
ROW6%
Spain 41%
Germany34%
Italy 18%
ROW10%
Spain 26%
Benelux10%
USA5%
Geographic Diversification
Italy 20%
ROW6%
Spain 14%
Belgium10%
Germany25%
Korea4%
USA15%
France6%
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Italy
2007200775MW
2008E2008E200 – 206MW
2009E2009E~320MW Secured*
*As of end of 3Q08
GermanySpain
Confidential
Project Installations
Netherlands – 83 kW
25 Confidential
Lisa Airplane sponsorshipprovide cells for the 1st
airplane to fly around the world using only renewable energy
International Exhibitions & Sponsorphips
26
Proud sponsor theRCD Espanyol Barcelona(Spanish premier ligue team)
SponsoringInternational Exhibitions
renewable energy
Confidential
Company Overview
The Solar Challenge
Trina Solar Strategy and Roadmap
Sales and Marketing
27
Sales and Marketing
Financial Performance
Confidential
$27,275$114,500
$301,819
2005 2006 2007 2008E
$800,000-
850,000
Revenue
$6,289$30,050
$67,914
2005 2006 2007 2008E
Gross Profit
GM 20%-
22%
23.1% 26.2% 22.5%
Annual Financial Performance
One of the strongest growth in the industry
2008 estimates based on guidance released as of end 3Q08
$3,311$12,421
$34,876
2005 2006 2007 2008E
Net Income
No Guidance
12.1% 10.8% 11.6%
$4,273$16,920
$36,273
2005 2006 2007 2008E
Operating Profit
OM 12%-
14%
15.7% 14.8% 12.0%
Confidential
$82,573$101,394
$120,671
$204,169
$290,723
3Q07 4Q07 1Q08 2Q08 3Q08
Revenue
$16,593
$27,598$31,076
$47,373
$65,190
3Q07 4Q7 1Q08 2Q08 3Q08
Gross Profit
Quarterly Financial Performance
29
Steady and well monitored quarterly growth
$7,771
$15,686$12,873
$17,101
$32,053
3Q07 4Q07 1Q08 2Q08 3Q08
Net Income
$6,931
$16,229$20,204
$29,126
$46,788
3Q07 4Q07 1Q08 2Q08 3Q08
Operating Profit
Confidential
Based on guidance released as of end 3Q08
30
Thank You!
Confidential