China-based manufacturer of photovoltaic (PV)-grade polysilicon Daqo New Energy Corporation posted a year-over-year (YoY) spike of 164% in its net income at $372.9 million for the fourth quarter of the financial year (FY) 2022, backed by increased earnings from polysilicon sales.

Daqo sold 23,400 metric tons (MT) of polysilicon during the October-December quarter, up 101% YoY. Polysilicon production increased to 33,702 MT compared to 23,616 MT during the same quarter of 2021.

The company’s revenue stood at $864.3 million, a YoY increase of 119% from $395.5 million.

Fourth-quarter revenue slumped 29% from $1.2 billion in the third quarter. Daqo said the quarterly fall in revenue was due to a decrease in sales volume which, however, was offset by an increase in average sale price (ASP).

“Our sales volume was 132,909 MT in 2022, 76.4% higher than 75,356 MT in 2021. Thanks to the robust demand for solar PV products globally, polysilicon ASPs increased by approximately 50% year over year from $21.76/kg in 2021 to $32.54/kg in 2022,” said Daqo New Energy’s CEO Longgen Zhang.

The company’s Earnings Before Interest, Tax, Depreciation, and Amortization (EBITDA) amounted to $648.5 million, up by 158% YoY. The EBITDA margin for Q4 was 75% compared to 63.5% in the same period a year ago.

Daqo said that the ASP of polysilicon increased to $37.4/kg in Q4 2022 compared to $33.9/kg in Q4 2021, while the average total production cost dropped to $7.6/kg from $14.1/kg last year.

Full-year 2022

Daqo’s net income for 2022 increased by 148% to $1.8 billion compared to $748.9 million during FY 2021.

The company sold 139,909 MT of polysilicon in 2022, a 76% increase against 75,336 MT in 2021.

The polysilicon production volume increased by 55% to 133,812 MT from 86,587 MT in FY 2021.

The company’s revenue for the year ending December 2022 jumped by 174% to $4.6 billion compared to $1.6 billion in 2021, thanks to higher polysilicon ASPs.

Daqo’s EBITDA rose 178% to $3.1 billion compared to $1.1 billion in the previous year.

The demand for polysilicon increased during the year, with China recording a 59% increase in PV installations at 87 GW for 2022 compared to the previous year.

According to CEO Zhang, “Despite higher solar module market pricing that many expected would lead to a slowdown in China’s PV installations, the Chinese PV end-market also saw robust growth for the year, with installations of 87 GW, an increase of 59% compared to 2021. These market conditions suggest that the global PV market demand was actually limited by supply, specifically polysilicon.”

“Daqo New Energy is well positioned to benefit from the above trends and deliver continued growth. The construction of our Phase 5A 100,000 MT polysilicon capacity expansion project in Inner Mongolia is progressing smoothly. We expect to complete construction and start pilot production in April 2023 and ramp-up to full capacity by the end of June 2023. Therefore, we expect to produce approximately 190,000~195,000 MT of polysilicon in 2023, 42% to 46% more than in 2022. Furthermore, our Phase 5B project for an additional 100,000 MT polysilicon in Inner Mongolia will start construction in March and is expected to be completed by the end of 2023,” he said.

Daqo New Energy posted a net income of $323.4 million in the third quarter of 2022, up by 11% YoY.