Goldwind Science&Technology Co., Ltd. ($002202)

Dear investors, good afternoon. Welcome to join us this call the 2026 first quarter results for Goldwind Science&Technology Company. Joining us, we have [ Mr. Cao Zhigang ], Board Director and President; Ma Jinru, Board Secretary and Company Secretary; CFO, Wang Hongyan; and also Group VP and GM of Wind Power Industry, Chen Qiuhua. We're going to have Ma Jinru to talk about the first quarter industry update and review. After that Wang Hongyan will go through the Q1 business review. And finally, we're going to take your questions. Now over to you, Ms. Ma.

Thank you. Dear investors, good afternoon. Thank you so much for joining this call for the Q1 earnings results. So first of all, about the industry review and business review. In terms of the industry review, this is the global annual installation in 2025 and the distribution across different countries. Not much update there, so I will skip there. So back to China. In the first quarter, the on-grid was -- capacity was 15.8 gigawatts, up by 7.9%. As of end of March, total wind power on-grid capacity was 655 gigawatts, which is about 16.5% of total energy installed capacity, while thermal power dropped to 39.2%. And also in last year, the total power consumption was actually 103,000 -- sorry, so 10 trillion kilowatt hours, up by 5%. And also, we have seen pretty much flat in terms of the tender. We are down by 2.2% in the first 3 quarters -- first 3 months this year, 28 gigawatts. And you can see on the right, the open tender average price pretty much stabilized. And now I'm listing the Q1 industry policies. Now First of all, it has to do with the power market in terms of the power market development on the January 30, NDRC, Energy Administration published notice on improving the generation side capacity tariff mechanisms and February 11, State Council published the opinion regarding the unified power market system. And the other 2 has to do with green and low-carbon objectives, which is on the March 5, the 2026 policy address, talking about developing green carbon economy on April 13, the publishing -- publication of opinion regarding the shipping green and low carbon transformation. On the right, this is the code of ecology and environment. The code further specified the general requirement of green and low-carbon development, developing circular economy, energy conservation and green and low-carbon transition to cope with climate change as the target, which will be effective on the 15th of April -- sorry, August this year, including development of wind power, solar as well as the consumption mechanism for renewable energy, building a new type of power system and also promotion of the green energy consumption. So in that kind of backdrop, let's turn to our business review. In the first quarter, we have external sale capacity of 6,040 megawatts, up by 133.45%, below 6 megawatts, which is 9%. 6 to 10 megawatts was 4,312 megawatts by -- accounting for 71%. 10 megawatt and above was 1,173 megawatts, about 19%. So at the end of the Q1, we have order backlog of 53.9 gigawatts, including external order, 50.7 gigawatts. So in terms of external order, tender win was 9.5 gigawatts and the signed contract 41.2 gigawatts. And also at the end of first quarter, our internal demand was 3.2 gigawatts, mainly for our self-run wind farms. So you can look at the pie chart in terms of distribution, you can see, again, the main component was 6 to 10 megawatts. So this is our international business footprint. As of end of Q1, our business international installed capacity exceeds 13,000 megawatts. Asia, excluding China and South America exceeds 3 gigawatts and also in Africa, Australia over 2 gigawatts, North America, Europe, over 1 gigawatt as of end of Q1. The order backlog overseas was 9 gigawatts. So this is the wind farm on the left. This is the wind farm. As you can see Q1 newly added [ equity ] capacity was 177 megawatts. We have disposed 102 megawatts of wind farm end of March. Our self-run wind farm equity capacity exceeds 10 gigawatts. 39% was domiciled in Northwest, 24% domiciled in East China, 16% domiciled in North China, the other was in single digits. End of Q1, our total capacity under construction in China and overseas was about 3 gigawatts. So in the first quarter, the average utilization hour of our self-run wind farm was 549 hours. On the right, you can see the distribution of the capacity of grid connection. We already touched upon that. So that was the business review. I'm going to hand over to Mr. Wang for the financial review.

Good afternoon. I'm Wang Hongyan, CFO. Thank you so much for joining this earnings call for the first quarter. I'm going to report to you the 2026 Q1 performance. So again, we're going to talk about 4 areas. Firstly, we're going to talk about the consolidated profit and loss and mainly the current assets, profitability, operating index and solvency and cash flows. So in the chart, we're looking at the -- the gray was actually the previous quarters and the blue part was Q1. This is on Slide 13. This is a consolidated profitability index. You can see we have a good beginning of the year. On the top left, this is the operating revenue. You can see the gray bar represents the quarters in 2025. The blue bar represents Q1 in 2026. And the Q1 revenue was RMB 15,485 million. which is increased by 64%, mainly from the wind turbine manufacturing increase and also implementation of strategy. And the revenue is actually hitting a record. And this is for the first time, we have over RMB 10 billion in the quarter. And then we have the gross margin in 2026, the first quarter margin was 16.76%, which is year-on-year decline. But this is really because we have higher revenue of wind turbine generator. So this is the first thing to watch. And secondly, the margins, RMB 2.5 billion, increased by RMB 533 million, up by a lot. So the increase has to do with the business mix improvement. In 2026 first quarter, again, this is the highest quarter in terms of gross margin dollars. And net profit margin in the first quarter, attributable net profit, RMB 907 million increased by 59.65% improvement in profit comes from 2 sides. First of all, higher GP margin. Secondly, and also lower the nonrecurring cost. And also the weighted average ROE in Q1 was 2.23% which is up by 0.75 percentage points year-on-year, thanks to the higher net profit margin and also improvement of business mix. So the average ROE continued to improve. So that was a very important 4 profitability metrics. And then turning on the 14th slide, which is on the operation metrics. The account receivable was RMB 33.9 billion, accounting for 20% of total assets. Account receivable as well as the turnaround turnover days has been improving. The operating efficiency has been improving. So this is really thanks to our management of the full cycle management of account receivable, putting customer in the center, working with the banks, and also optimizing the incentive mechanisms, achieving synergy so that we have significant outcome of improvement on the rise. We're looking at the first quarter inventory and contract asset balance, RMB 17.5 billion in total, which is reduced. It's now accounted for 10% of total assets, so which means operating efficiency improvement, also thanks to, firstly, management of turnover lead time and also improvement of the deliveries. And now turning to the next slide, which is the solvency metrics. In the first quarter, our interest-bearing debt was RMB 5 billion, slightly down -- slightly up -- sorry, slightly down year-on-year, which has to do with the business schedule, which is in line with the business schedule because right now, our -- we have an abundant credit line. So we have a reasonable debt ratio, and we have a robust funding capabilities. On the right, we are looking at -- at the end of Q1, the asset liability ratio, which is 71.1%. As you can see, year-on-year, Q-on-Q, we have significant reduction of the liability ratio. Thanks to the asset liability and equity structure improvement and also goes to show our financial management in terms of robustness and effectiveness. For the full year, we will continue to promote the deleveraging to leading the continued decline of asset liability ratio. Lastly, Slide 16, which is the cash flow and operating cash flow. On the left, so this is the quarterly cash flow in the last 5 quarters. At the end of first quarter this year, the balance was RMB 11.3 billion. Ratio of cash to total asset was 6.72%. So we'll continue to see significant improvement. Thanks to our efficiency in the overall management. On the right, this is the quarterly operating cash flow in 2025 and Q1 this year. So 2 features. First of all, there's a seasonality there and also the net cash flow -- net cash outflow has been narrow year-on-year. So the cash efficiency has been improved. Of course, also thanks to our refined management, the cash, different cycle, matching the revenue inflow. And for the full year, operating cash flow will continue to maintain healthy, stable and sufficiency, so that was the overview of financial performance in the first quarter this year. Okay. Thank you management... [Statements in English on this transcript were spoken by an interpreter present on the live call.]