Canadian Solar Inc.

Ladies and gentlemen, thank you for standing by. Welcome to Canadian Solar's third quarter 2021 earnings conference call. My name is Rochelle and I will be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a question and answer session. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Isabelle Zhang, IR Director at Canadian Solar. Please go ahead.

Thank you, operator, and welcome everyone to Canadian Solar's third quarter 2021 conference call. Please note that we have provided slides to accompany today's conference call, which are available on Canadian Solar's Investor Relations website within the events and presentation section. Joining us today are Dr. Sean Chu, Chairman and CEO, Yan Zhuang, President of Canadian Solar's majority-owned subsidiary, CSI Solar. Dr. Huifeng Chen, Senior VP and CFO. And Ismael Guerrero, Corporate VP and President of Canadian Solar's wholly-owned subsidiary, Global Energy. All company executives will participate in the Q&A session after management's formal remarks. On this call, Sean will go over some key messages for the quarter. Yann and Ismael will respectively review the highlights of the CSI solar and global energy businesses, followed by Huifeng, who will go through the financial results. Sean will conclude the prepared remarks with the business outlook, after which we will have time for questions. Before we begin, may I remind listeners that management's prepared remarks today, as well as their answers to questions, will contain forward-looking statements that are subject to risks and uncertainties. The company claims the protection of the safe harbor for forward-looking statements that is contained in the Private Securities Litigation Reform Act of 1995. Actual results may differ from management's current expectations. Any projections of the company's future performance represent management's estimates as of today. Canadian Solar assumes no obligation to update these projections in the future unless otherwise required by applicable law. A more detailed discussion of the risks and uncertainties can be found in the company's annual report on Form 20-F, filed with the Securities and Exchange Commission. Management's prepared remarks will be presented within the requirements of SEC Regulation G regarding generally accepted accounting principles or GAAP. Some financial information presented during the call will be provided on both a GAAP and a non-GAAP basis. By disclosing certain non-GAAP information, Management intends to provide investors with additional information to permit further analysis of the company's performance and underlying trends. Management uses non-GAAP measures to better assess operating performance and to establish operational goals. Non-GAAP information should not be viewed by investors as a substitute for data prepared in accordance with GAAP. And now, I would like to turn the call over to Canadian Solar's Chairman and CEO, Dr. Sean. Sean, please go ahead.

Thank you, Isabel. Good morning and good evening, everyone. During the third quarter of 2021, we delivered 3.9 gigawatts of module shipment and sold our largest battery storage project today, which is the 1.4 gigawatt hour crimson project located in Riverside County, California, one of the largest battery storage projects in the world. We accomplished 34% year-over-year revenue growth with growth margin well ahead of guidance and our strongest net profit performance since the start of COVID. Overall, we are pleased with our ability to navigate an extremely challenging market while continuing to focus on long-term investment and R&D innovation. You will hear Yan, Ismail, and Huifeng walk through a more detailed review of our performance in a few minutes. But first, I would like to highlight three key messages on the global energy outlook our strategic priorities and CSI Solar Far Vault IPO. Please turn to slide three. First, after many years, we are starting to see real action across the world to appropriately price the cost of carbon and cartel investment. in fossil fuels. For example, the European Union's emissions trading system, one of the most mature markets in the world, saw carbon prices exceed 60 euros per tonne for the first time in its history. Now it remains at nearly six times of its 2010 to 2018 average. In response, we are witnessing more actions that call for greater clean energy deployment. It is no coincidence that we are experiencing a number of energy crises across the world, most notably in Europe, China, and part of the US. These events reflect a broader trend of declining investment in traditional energy, insufficient investment growth in clean energy, and continual growth in economic development. I see three moving parts in this equation. However, we don't want to increase the supply of fossil fuel-based energy. We also don't want to lower our living standards. Therefore, the only solution is to accelerate the adoption of reliable, low-cost, and clean, renewable energy, including solar and battery storage. Please turn to slide four. So the long-term growth outlook for solar and battery storage is stronger ever. Solar PV's cumulative installations will cross 1 terawatt next year and is set to reach 3.2 terawatts by 2030. Battery energy storage cumulative installations will cross 100 gigawatt hours next year, and it's set to reach 1 terawatt hours by 2030. At the same time, clean energy PPAs are also going up, reversing a long-term trend of aggressive PPA bidding. The market is certainly adjusting and in a good way. Meanwhile, we are encouraged by the upbeat narrative and government policies in supporting the clean energy transition. China has announced a series of decarbonization policies for the 14th five-year plan, demonstrating the country's commitment to fight climate change. We expect more policies to come. We're also hopeful that President Biden's Build Back Better plan will pass Congress and set America on the right path towards decarbonization. These are responsible government policies that will support long-term sustainable development. Turning to slide five, all of these megatrend actions serve as tailwinds for our business for years to come. Our preparations to capture these opportunities started many years ago. Today, our global pipeline of solar and battery storage assets increase the visibility of our future growth. We are also expanding and deepening our sales channels, focusing on providing total clean energy system solutions. At the same time, we are making tactical manufacturing capacity expansion decisions, limiting investment in certain stage of supply chain to navigate through the short-term supply chain volatility. And we're investing significantly in technologies and R&D to maintain our leadership position in clean energy. And finally, I would like to update you on the CSI Solar 5 Volt IPO in China. Please turn to slide six. We are on the third round of Q&A feedback with Shanghai Stock Exchange and continue to make progress. We continue to communicate proactively and transparently with officials at the Shanghai Stock Exchange. At this point, we think it is more realistic to target completion early next year rather than this year, subject to cosmetic market and regulatory risks. With that, let me turn over the call to Ismail for an overview of our global energy business. Ismael, please go ahead.