Unidentified Analyst: Good morning and congratulations on a very strong quarter in what was a very difficult environment for the industry. I have a few questions. I want to start by asking if there were any charges — inventory related charges in the gross margin number in the third quarter.
Pan Li: Hello, Rajiv. The answer is no.
Unidentified Analyst: Okay. And were there any charges in the selling and marketing or general and administrative expenses that were one-time expenses?
Charlie Cao: Excuse me, can you repeat that again?
Unidentified Analyst: Yeah. Were there any one-time charges in the SG&A line items?
Charlie Cao: We did have some, roughly, I think maybe $20 million, $25 million one-off pool for some previous litigation regarding one of the module contracts a long time ago. So it’s one time. I think it’s in the other operating expenses not in the G&A expenses but we did have some — this $20 million one-off charge.
Unidentified Analyst: Okay and going back to the gross margin, I’m trying to understand what your cost of polysilicon was for the quarter. And the number I’m coming up with is around $16 on average, $16 per kilo on average, [Technical Difficulty] between Chinese polysilicon and the US polysilicon. Is that a fair estimate?
Charlie Cao: Rajiv, we don’t discuss the number, but you can look at the index and the China poly roughly, I think in the range of RMB60 per kg to RMB90 per kg. But the polysilicon out of China is kind of, I think, [2 or 5 times] (ph) compared to China. It’s different, the price, makes sense.
Unidentified Analyst: Yeah, actually, DQ Energy just reported their ASP for the quarter was actually $7.60. So that is actually closer to RMB50 per kg.
Charlie Cao: Yes, you’re right. You know, there’s a public index, right, for the poly and the calculations. But think about, we have the — inventory turnover days is roughly 60 to 80 days. We have production lead times, right? You need to think about the time difference and to do the calculations. But you can do the calculation based on the train, but the detail, the numbers, I think we have the supply chain advantage compared to market price. But we have different mix and for the US market, which is the market out of US, the poly price is different.
Unidentified Analyst: So, Charlie, is it fair to say that because you have 60 to 80 days of inventory, that your poly prices are always lagging the spot market by 60 to 80 days?
Charlie Cao: Yeah, you can do the estimation based on that.
Unidentified Analyst: Okay, my other question is about competition. At the prices where modules are right now, what percentage of the industry players between Tier 2 and Tier 3 do you think are losing money right now? And what percentage of these companies are cutting back on their production because they are below their — the pricing is below their cash cost?
Charlie Cao: For the — we have seen this situation in recent, I think, months is for different utilization rates for different players in the industries. For Tier 1 integrated companies, like Jinko, we have order visibilities, very good mix for the N-type versus P-type. And we have good management cost. So for some orders with relatively low price, we are able to continue to deliver, I think, the reasonable margin of growth per [indiscernible]. But for the Tier 2, Tier 3 players, even some, let’s say they are not integrated, they are not international companies, they are reducing their utilization rate. So it’s going to be different. It’s going to be different situation for different companies. I think the Tier 1 top — top tier company will take the advantage to get more market shares.
Unidentified Analyst: Right, right. Do you see that happening already, that Tier 3 companies are cutting back their production right now?
