Canadian Solar Inc.

My name is Rob, and I'll be your operator for today. At this time, all participants are in 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 Wina Huang, Head of Investor Relations at Canadian Solar. Please go ahead.

Thank you, Operator, and welcome everyone to Canadian Solar's second quarter 2024 conference call. Please note that today's conference call is accompanied by slides which are available on Canadian Solar's Investor Relations website within the events and presentation section. Joining us today are Dr. Sean Hughes, Chairman and CEO, Yan Zhuang, President of Canadian Solar's subsidiary CSI Solar, Ismael Guerrero, Corporate VP and President of Canadian Solar Subsidiary Recurrent Energy, and Simbao Zhu, Senior VP and CFO. 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. Yan and Ismail will review business highlights for CSI Solar and Recurrent Energy, respectively, and Simbao will go through the financial results. Sean will conclude his remarks with a business outlook after which we will have time for questions. Before we begin, I would like to remind listeners that management's prepared remarks today, as well as their answers to questions, will contain certain forward-looking statements that are subject to risks and uncertainties. The company claims protection under the safe harbor for forward-looking statements that is contained in the Private Security Litigation Reform Act of 1995. Actual results may differ depending on your current expectations. Any projections of the company's future performance represent management estimates as of today. Nagant Solar is no obligation to update these projections in the future unless otherwise required by applicable law. A more detailed discussion of 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 non-GAAP basis. By disclosing certain non-GAAP information, management intends to provide investors with additional information to enable 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 used by investors as a substitute for data provided in accordance with GAAP. And now I would like to turn the call over to Canadian Development Chairman and CEO, Dr. Sean Sweet-Joy.

Thank you, Weena. And thank you all for joining our second quarter call today. Please turn to slide three. In the second quarter, we delivered strong results. We shipped 8.2 gigawatts of solar modules, surpassing our previous guidance of 7.5 to 8 gigawatts. While increasing volume, we maintained competitive average selling prices, resulting in revenue of $1.6 billion and a gross margin of 17.2%, both in line with our previous, both in line with our previous. Over the past few months, we have observed signs of market rationalization. Record low prices are driving out uncompetitive players. Meanwhile, our industry peers pre-announced significant first half losses. In comparison, we have performed well, striking a delicate balance between volume and profitability. I'm proud of what we have accomplished in one of the most challenging industry cycles. I have experienced in my career. The underlying fundamentals of solar remain robust. As I have mentioned before, AI-driven data center expansion, electric vehicles, cryptocurrency, and other emerging technologies will generate substantial demand for clean energy solar and energy storages will also continue to be a major trend. We must not forget that the distance to meeting our global climate goals remains large. However, the challenges ahead should not be underestimated. It will take time to rebalance supply and demand in solar, given that today's industry competitors have more scale and resilience than ever before. How will we navigate a potentially extended downturn? Please turn to slide four. Canadian solar is a diversified business with complementary divisions that enable us to not only weather but also succeed in this challenging industry landscape. Today, our module business has reached an optimal scale, large enough to maintain a highly competitive cost structure yet lean enough to adapt swiftly to change in industry dynamics. Our approach to capacity investment has always carefully balancing vertical integration, the right technology mix, and magnitude. At the same time, we are positioning ourselves for sustainable growth through our rapidly expanding energy storage segment, a business for which we began laying the foundation 10 years ago. We are on track to grow by more than 500% this year, and we are doing so at industry-leading margins. What McKinsey has forecasted accumulative energy storage base of one terawatt hour by 2027. We have the expertise to grow alongside this market. Complementing our global manufacturing expertise in both solar and energy storage are our outstanding business teams. These local experts have enabled us to develop both global operations and a truly global brand. Finally, our project development platform, Recurrent Energy, is poised to deliver additional long-term value as it transitions to be a global developer, owner, and operator of solar and storage assets. A key element of our growth strategy is to do so sustainably and ethically. Please turn to slide five. In May, we proudly published our latest corporate sustainability report, which features expanded disclosures and enhanced transparency. Highlighting a few achievements in 2023, Canadian solar achieved reductions in greenhouse gas emissions by 37 percent, energy consumption also by 37 percent, water usage by 72 percent, and waste intensity by 54% compared to the level in 2017. Additionally, we remain on track to meet our target of powering all global operations with 100% renewable energy by 2030. As we have consistently emphasized Ethical labor practices are of utmost importance to us, both within our operations and throughout our supply chain. As a participant in the United Nations Global Compact, which we adhere to the UNGC's 10 principles of human rights, labor practices, environmental protection, and business ethics. To ensure the integrity of our operations and supply chain, we also engage with responsible business alliance to conduct validated assessment programs out there at our facilities and those of our suppliers. The RBA VAP audit is an industry leading standard for on-site manufacturing evaluations, assessing labor practices, health and safety, environmental impact, ethics, and management systems. Finally, we remain committed to promoting diversity equity, and inclusion. At Canadian Solar, we foster a productive workforce that benefits from diverse perspectives in decision-making processes. Our newly included gender pay analysis revealed that women at Canadian Solar earned 95% of what men earned in 2023, with the remaining 5% gap being equitable. In conclusion, I am pleased with our achievements in the second quarter and the first half of this year. We have demonstrated the resilience of our business in challenging circumstances and remain vigilant in our in our work moving forward. I will now turn the call over to Yan, who will provide more details of our CSI business, CSI solar business. Yan, please go ahead.