Good day everyone, welcome to the Daqo New Energy Fourth Quarter and Fiscal Year 2022 Results Conference Call. All participants will be in a listen-only mode. Should you need assistance, listen to a conference specialist by pressing the star key followed by zero. After today's presentation, there will be an opportunity to ask questions. To ask a question, you may press star and then one using a touch-tone telephone. To withdraw your questions, you may press star and two. Please also note today's event is being recorded. At this time, I'd like to turn the conference call over to Kevin He, Investor Relations. Please go ahead.
Hello, everyone. I'm Kevin He, the Investor Relations of Daqo New Energy. Thank you for joining our conference call today. The company just issued its financial results for the fourth quarter and fiscal year of 2022, which can be found on our website at www.dqsolar.com. To facilitate today's conference call, we also have prepared a PPT presentation for your reference. You can also find the PPT presentation at our website. Today, attending the conference call, we have Mr. Ming Yang, our Chief Financial Officer, and Mr. Longgen Zhang, our Chief Executive Officer and myself.
Before we begin the formal remarks, I would like to remind you that certain statements on today's call, excluding expected future operational and financial performance and industry growth are forward-looking statements that are made under the Safe Harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These statements involve inherent risks and uncertainties. A number of factors could cause actual results to differ materially from those containing any forward-looking statement. Further information regarding these and other risks is included in the reports or documents we have filed with or furnished to the Securities and Exchange Commission.
These statements only reflect our current and the preliminary view as of today and may be subject to change. Our ability to achieve these projections is subject to risks and uncertainties. All information provided in today's conference call is as of today. We undertake no duty to update such information except as required under applicable law. Also, during the call, we will occasionally reference monetary amounts in US dollar terms. Please keep in mind that our functional currency is the Chinese RMB. We offer these translations into US dollar solely for the convenience of the audience. Without further ado, now I will turn the call to our CEO, Mr. Zhang. Please.
Thank you, Kevin. Good evening, everyone. We are very pleased to report a record result for the year 2022. We would like to thank our entire team for achieving such a strong financial and operational performance. Our annual polysilicon production volume was 133,812 MT in 2022, exceeding our guidance of 130,000–132,000 MT , and a 54.4% higher than the 86,587 MT produced in 2021. 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 SP increased by approximately 50% year-over-year from $21.76 per kg in 2021 to $32.54 per kg in 2022.
As one of the most profitable and fastest-growing polysilicon manufacturers in the world, we achieved a strong financial result with revenues of $4.61 billion in 2022, an increase of 175% compared to $1.68 billion in 2021. Gross margin improved to 74% in 2022 from 65.4% in 2021. Net income attributable to our shareholders was $1.86 billion in 2022, an increase of 148.4% compared to $749 million in 2021. We generated approximately $2.47 billion in operating cash flow for the year and ended the year with a very strong balance sheet with $4.65 billion in combined cash, cash equivalent, risk-restricted cash, and banking notes with maturity within six months.
For the year of 2022, approximately 99% of our production volume was mono-grade polysilicon. We continue to be one of the world's leading suppliers of ultra-high purity N-type mono polysilicon, the foundation for the next generation N-type solar cell technology. Towards the end of 2022, a temporary seasonal slowdown in solar PV market caused inventory adjustments across the value chain, similar to the year-end of 2021. As a result, the downstream sectors, especially wafer, cell, and module manufacturers, reduced inventories and significantly lowered production utilization rates. This led to widespread price decline across the value chain.
In February 2023, lower module prices effectively stimulated market demand, and downstream production utilization rates quickly ramped up back to normal levels, reducing channel inventory significantly and leading to a meaningful recovery of polysilicon SP. Currently, current polysilicon prices of approximately CNY 230-CNY 250 per kg are very healthy and reflect the strong demand for solar modules in the range of CNY 1.7-CNY 1.8 per W. Global solar PV installations were approximately 268 GW in 2022, a 53% annual increase from approximately 175 GW in 2021, growing faster than most had forecasted at the beginning of the year.
The increase in polysilicon supply, in conjunction with supportive global climate change policies, as well as favorable economic conditions driven by grid parity, made 2022 one of the industry's fastest growing years. Meanwhile, solar module price increased from approximately CNY 1.80 per W in Q1 2022 to CNY 2 per W in Q4 2022. 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 GWs, an increase of 59% compared to 2021. These market conditions suggest that the global PV market demand was actually limited by supply, specifically of polysilicon.
Key global trends, including the urgent need to address climate change, the driver for greater energy independence, as well as positive economic conditions driven by a grid parity, have led to strong demand momentum for renewable energies, including solar PV. We believe energy transformation is still in its early stage and has opened a huge potential market for solar PV, which is likely to be far beyond expectations. The high-purity polysilicon sector will continue to benefit strongly from these positive developments. 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 progressed smoothly.
We expect to complete the construction and start pilot production in April 2023, and ramp up full capacity by the end of June 2023. We expect to produce approximately 190,000–195,000 MT of polysilicon in 2023, 38%-46% more than in 2022. 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 this year. Solar PV will continue to play a critical role in transforming the global energy infrastructure by powering the world with sustainable, cost-effective, and renewable energy at a pace much faster than thought possible.
As a leading player in polysilicon industry, we outperformed most of our peers in terms of unit profitability, cost structure, and product quality in 2022. We believe our forecasts are our core competitiveness, solid growth roadmap, and our strong balance sheet will allow us to benefit from the long-term growth of global solar PV market. For the future outlook and guidance, we expect to produce approximately 31,000–32,000 MT of polysilicon in the first quarter of 2023, and approximately 190,000–195,000 MT of polysilicon in the full-year of 2023, inclusive of the impact of the company's annual facility maintenance. Now, I will turn the call to our CFO, Mr. Yang. Please.
Thank you, Longgen. Hello everyone. Thank you for joining our earnings conference call today. Now I will discuss the company's financial performance for the quarter and for the year. Revenues were $864 million, compared to $1.22 billion in the third quarter of 2022, and $295.5 million in the fourth quarter of 2021. The decrease in revenue compared to the third quarter of 2022, as Longgen mentioned, was primarily due to a decrease in sales volume, mitigated by an increase in average selling price. Gross profit for the quarter was $668.9 million, compared to $978.6 million in the third quarter of 2022, and $239.8 million in the fourth quarter of 2021.
Gross margin was 77.4% compared to 80.2% in the third quarter of 2022, and 60.6% in the fourth quarter of 2021. The slight decrease in gross profit compared to the third quarter was primarily due to the lower sales volume as well as higher production costs. Sales, general, and administrative expense was $44 million compared to $280 million in the third quarter of 2022, and $10.2 million in the fourth quarter of 2021. SG&A expenses during the fourth quarter included $28.4 million in non-cash share-based compensation costs related to the company's share incentive plan. This compares to the third quarter cost of $263.4 million in the third quarter of 2022 of non-cash share-based compensation costs.
Research and development expense for the quarter was $2.7 million compared to $2.5 million in the third quarter of 2022, and $1.3 million in the fourth quarter of 2021. R&D expenses vary from period to period, reflect R&D activities that take place during the quarter. Currently, most of our R&D are spent primarily on our N-type technology research as well as research to reduce production costs. Income from operations was $623 million compared to $693 million in the third quarter of 2022 and $228 million in the fourth quarter of 2021. Operating margin was 72% compared to 56.8% in the third quarter of 2022, and 57.7% in the fourth quarter of 2021.
As a result of the above, net income attributable to Daqo New Energy Corp. shareholders was $372.9 million, compared to $323.4 million in the third quarter of 2022, and $141.3 million in the fourth quarter of 2021. Earnings per basic ADS was $4.78, compared to $4.28 in the third quarter of 2022, and $1.90 in the fourth quarter of 2021. Adjusted net income attributable to Daqo New Energy shareholders, excluding non-cash share-based compensation cost, was $403.3 million, compared to $590.4 million in the third quarter of 2022, and $143.6 million in the fourth quarter of 2021.
Adjusted earnings per basic ADS was $5.17, compared to $7.81 in the third quarter of 2022, and $1.93 in the fourth quarter of 2021. EBITDA for the quarter was $648.5 million, compared to $720 million in the third quarter of 2022, and $251.1 million in the fourth quarter of 2021. EBITDA margin was 75% compared to 59% in the third quarter of 2022, and 63.5% in the fourth quarter of 2021. For a review of our full-year 2022 results. Revenue for the year 2022 were $4.6 billion compared to $1.68 billion in 2021.
The increase was due to higher polysilicon average selling prices, also a significantly higher sales volume. Gross profit was $3.4 billion, compared to $1.1 billion in 2021. Gross margin for the year was 74% compared to 65.4% in 2021. The increase in gross profit was due to higher sales volume and higher selling prices. SG&A expenses for the year was $354.1 million, compared to $39.9 million in 2021. The increase of SG&A expenses for 2022 compared to 2021 was primarily due to our non-cash share-based compensation costs related to our share incentive plan, which was $299 million for 2022 compared to $8.4 million in 2021. R&D expenses were $10 million compared to $6.5 million in 2021.
The income from operations for the year was $3.04 billion compared to $1.05 billion in 2021. Operating margin was 66% compared to 62.6% in 2021. Interest income for the year was $14.5 million compared to $20.5 million in net interest expense in 2021. The increasing interest income was primarily due to our higher, our cash balance. Income tax expense for the year was $537 million compared to $170 million in 2021. Net income attributable to Daqo New Energy shareholders for the year was $1.86 billion, compared to $748.9 million in 2021. Earnings per basic ADS for the year was $24.51, compared to $10.14 in 2021.
Adjusted net income attributable to Daqo New Energy shareholders was $2.16 billion, compared to $759 million in 2021. Adjusted earnings per basic ADS were $28.50 per share, compared to $10.28 in 2021. EBITDA for the year was $2.15 billion, compared to $1.13 billion in 2021. EBITDA margin for the year was 68.4% compared to 67.5% in 2021. Now on the company's financial condition. As of December 31st, 2022, the company had $3.52 billion in cash, cash equivalents and restricted cash, compared to $3.05 billion as of September 30th, 2022, and $724 million as of December 31st, 2021.
As of December 31, 2022, the bank note receivable balance, which can be immediately redeemed for cash, was $1.1 billion, compared to $1.57 billion as of September 30th, 2022, and $366 million as of December 31st, 2021. These bank notes typically was maturing about six months timeframe. Now on to the company's cash flow. For the 12 months ended December 31st, 2022, net cash provided by operating activities was $2.46 billion, compared to $639 million in the same period of 2022. The increase was primarily due to higher revenue and higher growth margin.
For the 12 months ended December 31st, 2022, net cash used in investing activity was $1 billion, compared to $782 million in the same period of 2021. Net cash used in investing activities in 2022 was primarily related to total capital expenditures on the company's 100,000 MT polysilicon project in Baotou City, Inner Mongolia. For the 12 months ended December 31st, 2022, net cash provided by financing activity was $1.47 billion, compared to $736 million in the same period of 2021. The net cash provided by finance activities in 2022 was primarily related to net proceeds of $1.6 billion from our Xinjiang Daqo's private offerings in China's A-share market. That concludes our prepared remarks.
Now we will open the call for questions from the audience.
Ladies and gentlemen, once again, if you would like to ask a question, please press star and one. To withdraw a question, you may press star and two. If you are using a speakerphone, we do ask that you please pick up the handset prior to pressing the numbers to ensure the best sound quality. Our first question today comes from Philip Shen from Roth MKM. Please go ahead with your question.
Hi, everyone. Thanks for taking my questions. Wanted to start off with your latest outlook on pricing. Specifically, you know, Longgen, I think he talked about, you know, the rise of module prices, stabilizing polysilicon prices. How do you expect polysilicon prices to trend by quarter for the rest of the year? Thanks.
Thank you, Philip. I think, you know, since, you know, last year, December, that's every year, I think, since the year 2020, because all the fees is Thanksgiving Holiday, New Year plus Chinese New Year. The downstream, the waiver, I think, producer of, you know, every year reduce their utility capacity, utilization rates we call. Last year, same thing happened. Since then, because Chinese New Year, very close to, I think, you know, the New Year. Basically, in December, last year, December, we didn't sell any, you know, silicon. 1 per kg silicon.
The reason is because I think, the player, waiver player almost, you know, the utilization, the capacity is down to, I think it's something to zero, even 10% and clean all the inventory. Basically then, Chinese New Year is coming I think early February. January we also didn't selling anything. February we're starting. I think right now we, at the end of last year, we have even probably is around 5,010, 4,200 tons. We believe, I think we've given guidance. I think right now the price, come back from last year December, almost lower, as lower as like CNY 120 per kg. Right now is, you know, come back to normal.
It's around like CNY 210-CNY 250 per kg. We sold more than 10,000 tons in February as the, you know, the price is higher. We will continue selling. We believe Q1 the selling price should be about CNY 200-CNY 220. The reason is because I think in the second quarter of this year is not too much new player come in, it's not too much output, new output come out. We think we will continue to digest our inventory, come to normal. My forecast, I think, you know, before middle of this year, before end of June, the selling price should be about CNY 210, even higher, go to CNY 250.
The Q3, I think, you know, the only new capacity is come from our Inner Mongolia Phase 5A come out, but the market demand is continue to go up. We believe, I think, you know, we can keep the silicon price between CNY 150-CNY 200. Q4, definitely I think, you know, the picture is not clear. It's like crystal ball. The silicon price maybe will go down to CNY 100-CNY 120. Overall this year we're still thinking of is very profitable for Daqo. Second is we do not think the module price will continue to go down because we see that, you know, high performance module like TOPCon module.
Even today in China, we can sell it around CNY 2 per W. Overseas of course, depend on different regions. I think original contract like Jinko signed almost, you know, 80% overseas, they are fixed price, so it's very profitable. Yes, maybe the module price will go down in Q4 this year. Don't matter you see if module price is $1.70 per W, still can support polysilicon price above RMB 200. The only thing is the growth margin allocation between silicon wafer and the sale of the module. But we believe silicon segment still is a very, I think, you know, capital intensive investment.
A long time, you know, constructing period still is a challenge. Yes. I think maybe next year then it's not only silicon maybe oversupply than demand, but also wafer sale module the same. So it's, you know, maybe come back, you see the lower module price will stimulate the whole market to come back. So I think it still is, you know, acute balance. What I can say is this year we still think, you know, polysilicon is very profitable and we will continue, you know, to make money.
Great. Thanks for all that color, Longgen. It's really helpful. You mentioned you didn't sell any poly in December or January, and you said you sold 10,000 tons in February. If you're producing 10,000 at least a month, are you saying that incrementally you sold another 10,000? Also did, do you still have any of that excess inventory left over or have you already sold it all in the month of February? Thanks.
I think, for the Q1 we've given guidance. I think, sell all the production, new production, for the Q1. End of the Q1, we maybe still have inventory around, you know, 10,000 tons, you know, around about, okay? Yes, we sold whatever we do I think produced. At a still, you know, at a stable price. Very high price. Yeah. About, let me be like around $220 per kg.
Okay.
I say February.
Okay.
We sold more than 10,000. I'm not saying 10,000. More than 10,000. For March we were selling more than 20,000 tons.
Very good. Thank you, Longgen. Shifting to your bookings. I think on the last call, you're 90% booked for 2023. You can't really move much more than that. Was wondering if you can talk through, you know, what you're contracted for 2023 and perhaps even for 2024. Then I'll have one more final follow-up. Thanks.
You mean the long term contract? I think, for this year our planning is given guidance is 190,000 tons to, I think, 195,000 tons. Right? I think for long term contracts, we almost cover right now, almost cover more than 90%. We are continue, I think, working with the client to sign long-term contracts. Majority, I think for 2023, with more than 90%. For 2024, we right now is more than—if we didn't have any, not considering any capacity expansion, I think we cover at least, I think next year 70%. I think the year 2025, we cover, you know, more than 65%. The, the long-term contract is a rollover.
Great. Okay. The final question I had was on your cost structure. you know, Q4 was a little bit higher. Just curious, if you share how you expect your cost structure to trend by quarter this year? Thanks.
Okay. Hello, Phil, this is Ming. The increase in cost structure for Q4 compared to Q3 is primarily due to increase in raw material costs, particularly the market cost for silicon metal, as well as increase in electricity rate. I think as you know, and probably most investors are aware that China actually, like, broadly did see increase in electricity rates across all of China, including areas like Yunnan, Sichuan, as well as Inner Mongolia and Xinjiang as well. All the cost increase have been fully reflected in our updated cost structure for Q4.
In terms of our cost trend, we do expect overall our cost structure for the first half of 2023 should be similar to our Q4 costs. While, after we ramp up our Inner Mongolia facility, we expect our costs to come down. I think, and based on our latest internal estimate, we do think, for example, our cost in Q4 for 2023 should be about 5%+ lower than, for example, our first half costs, assuming the same electricity and silicon metal costs.
Great. Okay. Thanks very much, guys. I'll pass it on.
Great. Thank you.
Our next question comes from Leo Ho from Daiwa Capital Markets. Please go ahead with your question.
Thanks management. First of all, congrats on the solid sets of 2022 result. We deeply appreciate the clear and encouraging production target for 2023. My first question is on cost. We noticed that there has been some power shortage in Yunnan recently. How do you expect it to affect silicon metal price? Do you expect there will be cost-driven polysilicon price hike? This is my first question. Thank you.
Okay. Actually interestingly, silicon metal cost in Q4 of last year was substantially higher than Q3 of last year, I think primarily due to higher energy costs within China. Silicon metal price briefly declined in January of this year. Now it is a little bit on the trend, a rising trend, but we haven't really seen any significant, an increase of silicon metal cost due to the issue with Yunnan. That's what we're seeing currently. As a result, you know, we do think our Q1 costs should be relatively stable compared to our Q4 costs.
Thank you so much. That's very clear. My second question is on, can you share with us a little bit color on the industry inventory level for polysilicon? Thank you.
Industry inventory level for polysilicon?
Yes.
I think, you know, the, China, as you know that every month, our production output is around 1,000 tons. For the inventory, as we cannot calculation, you know, every one. I think, you know, the end of last year, the inventory is around less than 50,000 tons. You know, the reason is because Tongwei, they are continued vertically integrated. Also I think, you know, just send the material outside to do the processing and then take the wafer back, continue to produce cell.
Up until right now, because I think the market come back to normal, I think Tongwei, TBEA and us, I think the inventory gradually digest. If you ask me, by the end of Q1, how much inventory is there? I think it should be less than 50,000 tons.
Thank you. That's very clear. My third question is on sort of technological development. We noticed that one of our peers is announcing some breakthrough on the continuous crystal growth technology over the course of four ten, also the first quarter of this year. How do you expect the competitiveness of advanced Siemens method that we use in comparison with the FBR granular silicon that they propose? Thank you.
Okay. Hello. I believe your question is for example, granular silicon, right? The FBR process, versus our Siemens, traditional Siemens process, right?
Yes.
Yes. Okay. I'll take it from two perspectives, okay? I think one is really from quality perspective. Okay. The FBR process, because it has much higher contamination of both hydrogen and also because of it uses a graphite stack for heating, so a lot higher carbon contamination as well as because of the high surface area compared to the intrinsic area, a much higher surface metal contamination. If you compare the quality of the Siemens, advanced Siemens process, especially in the high purity suppliers like us, compared to a typical FBR type of process, our purity is around 100x higher.
Okay. You know, a lot of our purities are now on the parts per billion type parts per trillion level, right?
From a purity perspective, I think if you look at what's happening in the market is that, you know, companies, our customers will use our product as their primary use of silicon, and FBR only generally used to as a mix. Because that's what I think. I think FBR, you know, as the market grows, I think it does have a relatively a more limited addressable market. In terms of cost structure, I think even ideally, if you're talking about maybe saving, you know, 20– 30 kW hour of electricity, you're talking about CNY 6-CNY. 8 per kg of cost reduction.
You know, but what we're seeing in the market is that FBR generally offers between CNY 15-CNY 20 or more in cost discount or price discount. I think that's fully reflected in that kind of environment.
Thank you. My last question, and I will jump back to the queue. Can you share with us the price premium of the N-type polysilicon over P-type polysilicon right now, either in like absolute term or in percentage term? Where do you expect to enlarge your narrow?
I think right now the N-type and the P-type, the price I think is not, you know, too much difference. The reason is because the selling price is high. Right now is around, you know, every selling I will ask you is $72. Right now RMB is around RMB 220, RMB 230. The N-type may be RMB 3 per kg higher. As I think, the silicon price, you know, back to normal, and then as the demand continue for high quality of high purity of N-type, I think the difference will become larger. When silicon price go down, let's say to CNY 100, I think N-type and the P-type will be more than CNY 10 per kg difference. That means maybe $1, $2 difference is there.
That's clear. Thank you so much.
Great. Thank you.
Our next question comes from Alan Lau from Jefferies. Please go ahead with your question.
Congratulations to the results, and also thanks a lot for taking my question. My first question is about the progress of your Inner Mongolia plan. It is supposed to be completed in April, right? As agreements to ramp up. Is it correct? I would like to know, you have also mentioned that in 2Q there's not much supply addition. Would like to know if you may share with us more color on those, because there are a lot of peers or new players are scheduled to have their plans to be built to be completed in 2Q.
I think in Inner Mongolia, I think phase 1 we call Phase 5A. We are planning, I think, to put into trial production in April this year. We believe we can full capacity running, I think in May of this year. These we're adding for this year, I think, you know, more capacity to our total guidance. We're giving guidance is 190,000– 195,000. Is around I think we already calculating is around I think 60,000 tons this year maybe adding to our, you know, total guidance. For the phase 2, I think we starting, I think we already announced that we're starting design and for this month we're also starting I think field work.
We are planning, you know, to early maybe end of this year or early next year, starting to trial production. That will help us, I think, next year capacity. In total together, I think Mongolia is 200,000 tons project. That's for N-type, okay? If for the P-type, we maybe produce a little more, maybe 5%-10% more. The Mongolia capacity, I think besides that, you know, 200,000 measured tons of polysilicon, we also I think in Xinjiang, we do the silicon metal. Silicon metal because I think we are waiting for the energy pool, supply pool.
We believe maybe, you know, by the end of this year or next year, I think, you know, 150,000–200,000 MT we're putting into production. Meanwhile, the semiconductor, I think, 1,500 tons, I think in the Phase 5A, we're starting maybe production semiconductor in this year, September of this year. This is our whole total planning for, I think, Mongolia.
Thank you. Thank you. Would you share update on your peers, like some of your peers, like Lihao or other players, like, because they are supposed to have their plans completed in 1Q and 2Q? Do you think that will add to poly supply and may cause poly prices to drop, or?
We're not comment on, you know, our peers, especially those new comment, you know, new comments in the commerce, right? we're not do any comments. as you will see, I think, you know, as the timing continue going on, we believe, I think, you know, I think for newcomers, some challenges there, you know, both, I think, you know, product quality and on time schedule delivery, et cetera. we're not going to be comments on peers.
Thank you. Thank you. Would like to check on the dividend ratio, because the company has posted an excellent return in 2022. Also, the company has also announced the $700 billion of buyback in 2023 in the U.S. level. Wonder if it implies what level of dividend ratio in order for the U.S. ADR to have the required amount of cash to carry out the buyback?
Basically, I think, next month, the A-share company will have a, you know, shareholders meeting. At that time, we will announce the, I think, dividends declared. I cannot give you a detailed figure, but as we already announced, we will buyback, we own, I think a U.S. company owns the A-share 73%. We'll buyback $700 million. You can easily do, you know, a calculation. We believe we should be between 30%-40%, our next profit will distribute as a dividend. Declare, yeah. The figure is not finalized.
Thank you. Thank you. My last question here is on the PCAOB investigation. How do you see that, like, and will this be a positive catalyst to the company?
I think the four bigger firms, I think two is already passed, you know, basically. Of course, the report still is not on the website, PCAOB website. I think they're already starting, I think, you know, Deloitte and PwC in right now. I think the government, Chinese government is very cooperative, and we also very open as a public company. I don't think any challenge and so far. I think, you know, hopefully the PCAOB can also, you know, they are regular, I think, regularly inspection for their members. We believe, I think, the bigger four firms in China, the branches will be okay.
Understood. Thanks a lot for taking my questions. I'll ask more. Thank you.
Thank you.
Thank you.
Our next question comes from Gary Zhou from Credit Suisse. Please go ahead with your question.
Hello, management. Thank you for taking my question. Just two quick follow-up on the our share buyback program. Firstly I want to ask, in terms of the timing, when do we expect the dividends from ACLE subsidiary? Secondly, for the buyback, is it possible that we would consider to do some small buyback before receiving the ACLE dividends? Is it, you know, probably gonna be after we receive the ACLE dividends from ACLE? Lastly, because I did a simple calculation, $700 million, that's almost kind of 20% of our current market cap and probably even bigger in terms of our conversion flow.
Just wondering, does this surprise? It implies that, you know, how to we get it functioning? The fact that could be a little bit kind of relatively aggressive. Thank you.
Gary, let me answer first question. Ming answer second question, okay? We know right now we cannot complain anything in the market, right? Market is always correct. Right now our stock price, we also cannot do anything. We know this is total below our, you know, I think, equity value. We just finished, I think, a raise, $140 million. Basically it's use our Chongqing, I think, Daqo New Energy U.S. listed co, the 100% subsidiary in Chongqing. The money deposited to China Merchants Bank. We got the loan, I think, is around $140 million. Yes, in this window open, we will buyback. The amount is around $140 million.
We already declare the dividends, I think, next month. That will be, you see, $700 million. You take, you know, one is for the $40 million away. You have like $560 million left. That's for the next window. That means May and June, the window open, we will buy back. Basically, I only can tell you that. We were two window, we're going to executing our stock buyback program. We will really do that. Ming, you on the second side.
Yeah. Like Longgen has mentioned. I think both our board and our management team believe our current share price in the U.S. is extremely undervalued. It's trading at a huge discount, whether it's to the company's cash level or our equity value or our future potential earnings. I think, you know, we announced our results for 2022. You can see our cash generation, our current cash balance on hand, while I think you forecast any expectations of poly pricing for this year. Given that it's still around $30 per kg today in the market. We will continue to generate significant cash flow for this year and likely for future periods because we are the lowest cost producer in the world effectively.
With some of the highest quality, especially when N-type products likely to becoming, you know, the mainstream module for the next year or so. We are going to be one of the primary supplier of N-type poly as well. We do believe, you know, now is really a good opportunity for the company to be very active in terms of our share buyback program. I think in terms, your comment in terms of the market cap, well, while it does look like it's a fairly high percentage, I think it's because our market cap is extremely low compared to our cash flow generation and also the capital that we have. That's the comment from me.
Yeah. Thanks a lot, management.
Yeah. Thank you.
Secondly, just a very quick question on the our future capacity expansions. Will we consider or study the kind of a possibility to expand in other countries outside China? If we, you know, go in the future, if we see kind of more kind of a trade restrictions.
Yes, we always research all the, you know, situation and including the overseas, you know, capacity. I think, especially I think the market, the global market module price also the, you know, regional political, I think the conflict, you know, et cetera. Yes, we will compare, you know. The reason we go to overseas, we have to considering the local business practice, all the resources and the people, the talent, and so on. Definitely, if any opportunities, we do the study and we will announce.
Yes. Okay. Thank you. That's all my questions. Thank you.
Thank you.
Our next question comes from Alan Hon from JP Morgan. Please go ahead with your question.
Hi, congratulations on a set of great results. I have just one question on your CapEx. Can you share with us, like, what is the CapEx commitment for Phase 5A and Phase 5B? How much is already spent and how much you expected to spend this year?
Okay. I have the numbers in CNY first, and I'll kind of translate to USD. The CapEx for Phase 5A, total CapEx is around CNY 9.5 billion or so. For Phase 5B, total CapEx is expected to be about CNY 9 billion. I guess Phase 5A is around $1.4 billion, and Phase 5B is around $1.3 billion or so. Actually for the full-year of 2022, we spent approximately $1.3 billion in CapEx. Most of it is related to our Inner Mongolia project Phase 5A, but some of it was also the remaining payment for Phase 4B and for our technology upgrade.
In terms of CapEx for 2023, I think for the full-year, we're expecting roughly $1.2 billion of CapEx for the full-year. Of which roughly $900 million-$1 billion is for Phase 5B in Inner Mongolia, and around $300 million is for our, the remaining payments for our Phase 5A in Inner Mongolia.
Got it. Thanks very much.
Sure. Thank you.
Ladies and gentlemen, at this time we'll end today's question and answer session. I'd like to turn the floor back over to Kevin for any closing remarks.
Thank you everyone again for participating today's conference call. Should you have any further questions, please don't hesitate to contact us. Thank you and bye-bye.
Ladies and gentlemen, that does conclude today's conference call. We do thank you for joining. You may now disconnect your lines.