Ladies and gentlemen, thank you for standing by. Welcome to Canadian Solar's Fourth Quarter 2023 Earnings Conference Call. My name is Melissa, and I will be your operator for today. At this time, all participants are in a listen-only mode. Later, we will conduct a Q&A 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 fourth quarter 2023 conference call. Please note that today's conference call is accompanied with slides which are available on Canadian Solar's Investor Relations website within the Events and Presentation section. Joining us today are Dr. Shawn Qu, Chairman and CEO; Yan Zhuang, President of Canadian Solar's subsidiary, CSI Solar; Dr. Huifeng Chang, Senior VP and CFO; and Ismael Guerrero, Corporate VP and President of Canadian Solar's subsidiary, Recurrent Energy. All company executives will participate in the Q&A session after management's formal remarks. On this call, Shawn will go over some key messages for the quarter. Yan and Ismael will review the highlights of the CSI Solar and Recurrent Energy, respectively, and Huifeng will go through the financial results. Shawn will conclude with prepared remarks with the 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 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 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 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 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. Shawn Qu. Shawn, please go ahead.

Thank you, Wina. Thank you to everyone for joining our fourth quarter call today. Please turn to Slide 3. 2023 marked a record year for Canadian Solar. CSI Solar achieved solar module shipments of 30.7 gigawatts, a year-over-year increase of 45%. This milestone drove our revenue to an all-time high of $7.6 billion. Despite challenging conditions, our full year net income attributable to Canadian Solar shareholders was $274 million or $3.87 per diluted share, a historic high. Before we delve deeper, let's take a moment to reflect on our journey over the past two decades. Please turn to Slide 4. Canadian Solar has evolved into a full stack solar and battery energy storage business spanning both manufacturing and project development. Our strategic decision to carve out CSI Solar has established it as a vertically integrated powerhouse with 118 gigawatts of cumulative shipments. Our focus here remains on leading edge technology and strategic sustainable expansion. Within CSI Solar, our utility scale battery energy storage business, e-STORAGE is post to deliver on a massive $2.6 billion backlog, which we continue to grow. Meanwhile, Recurrent Energy has become one of the world largest and most geographically diverse project developer. With the recently announced $500 million BlackRock investment, it is equipped with the ammunition to execute on its business transformation. What does this all mean? We are prepared to navigate the next phase of the industry and our own evolution. Not only can we capitalize on the collaborative advantages across our businesses, but we also possess different levers for growth. This diversified nature, coupled with our world class team enables our steadfast commitment to long-term value accretive growth. Turning to Slide 5. We see the world is grappling with a surge in clean energy demand. From data center to electric vehicles to cryptocurrency mining,…

Thank you, Shawn. Please turn to Slide 7. As noted, 2023 was a landmark year for CSI Solar. We achieved a 45% year-over-year growth in solar module shipments, reaching 30.7 gigawatts, our e-STORAGE segment grew pipeline to a record 63 gigawatt hours with $2.6 billion in contracted backlog as of January 31, 2024. We reached record full year revenue of $7.2 billion. The module business tackled a challenging environment with steep declines in ASP destocking of channel inventory in distributed generation, markets, and policy uncertainty. However, we're able to mitigate impacts through structural manufacturing cost reductions. Moreover, our manufacturing and technology strategies have allowed us to differentiate ourselves in the industry. Let us take a deeper look at our transition to TOPCon on Slide 8. We observe increasing technological barriers in N-type technologies such as TOPCon and we're proud of the swift progress we have made. N-type TOPCon cell capacity now accounts for more than half of our total cell capacity and is expected to reach near 80% by the end of this year. Alongside our expansion of TOPCon manufacturing, we also continued to make inroads in our made in the U.S. modules, increased our vertical integration and strengthened our Thailand supply chain. Shifting focus to battery energy storage. Let us turn to Slide 9. Storage plays a critical role in ensuring solar energy's dispatchability, stability and security. The storage market is projected to grow massively, exceeding 1 terawatt hour in cumulative capacity by 2030. We are well-positioned to capture growth, especially in strategic markets like the U.S., where we have a strong track record in both solar and battery energy storage. Our differentiation lies in both product and execution. e-STORAGE is trusted by customers for its outstanding track record in delivering turnkey solutions. This trust spans operational execution and…

Thank you, Yan. Please turn to Slide 10. In January 2024, we proudly announced a $500 million capital commitment from BlackRock, one of the world's largest and most sophisticated renewable energy investors. The $500 million investment will represent 20% of the outstanding fully diluted shares of Recurrent Energy on an as-converted basis. Canadian Solar will continue to own the remaining majority shares of Recurrent Energy after the closing of the investment. With this investment, our goal is to have 4 gigawatts of solar and 2 gigawatt hours of battery energy storage projects in operation by 2026. The $500 million in equity capital not only equips us with dry power to develop and own more projects but also bolsters our balance sheet and our debt-raising capacity. By owning this asset, we can retain more of the value we create during the development process, enjoying very stable cash flows since most of our revenues are contracted with top counterparties. In addition, we continue to recycle capital and drive growth organically. Hence, we have sufficient growth equity capital for the next two years. Beyond that, our capital needs will depend on how aggressively we want to expand, being able to do so above a 25% compound average growth rate without the need to raise more capital. This investment is instrumental to our transition from a pure development to a developer plus long-term owner and operator in select markets, enabling a more diversified portfolio and stable long-term earnings. With the support of BlackRock, Recurrent will concurrently push toward improving ESG standards, including across biodiversity, health and safety, community engagement and environmental justice. Recapping on 2023, please turn to Slide 11. For the full year 2023, Recurrent Energy's operating contribution footprint was light as previously guided. We achieved 280 megawatts in project sales, $498 million…

Thank you, Ismael. Please turn to Slide 13. In Q4, we exceeded guidance on shipments reaching 8.2 gigawatts, a 26% increase year-over-year. We were in line with revenue at $1.7 billion and gross margin was 12.5%. The decline was driven by lower module ASPs and inventory write down. As the lion's share of perk inventory has cleared and the TOPCon ramp-up costs will decrease over the course of 2024, we expect no further sizable impairments. Selling and distribution expenses declined 6% sequentially. The reduction was driven by lower shipping costs due to the ongoing global freight oversupply with the Red Sea shipping disruption largely contained until the end of December. We foresee a slight, but not meaningful increase over the course of 2024 due to the ongoing conflict. General and administrative expenses declined 5% sequentially with internal cost controls. Research and development expenses increased 9% sequentially, driven by high investments in new technologies. Net interest expense in the fourth quarter was $18 million, up from $11 million in the prior quarter. This was mainly driven by increased financing and comparatively lower interest income. Net foreign exchange gain in the fourth quarter was less than $1 million. Total net income was negative $3 million, with net income attributable to Canadian Solar shareholders at a negative $1 million or diluted EPS of negative $0.02. Now turning to cash flow and the balance sheet. Please turn to Slide 14. For the full year of 2023, we generated approximately $685 million in operating cash and spent over $1.1 billion in CapEx below expectation as we slow down the payment of certain capacity expansion plans. Hence, some CapEx for 2023 will be realized in 2024. We ended a period with a healthy cash balance of $3 billion and a total net debt of $1.7 billion. Leverage measured as net debt to EBITDA excluding restricted cash increased slightly quarter-over-quarter to 2 times due to the incremental borrowing for working capital and additional vertical integration for CSI Solar and a new project development for Recurrent Energy. For 2024, we expect CapEx to be approximately $1.8 billion as we further vertical integration plans and invest in U.S. manufacturing. We know that this number is slightly higher also due to a timing effect whereby certain remaining payments from the end of 2023 will be carried over to 2024. Recall, in 2023, we guided to $1.5 billion, but only spent $1.1 billion. Now let me turn the call back to Shawn, who will conclude with our guidance and the business outlook. Shawn, please go ahead.

Thanks, Huifeng. Let's turn to Slide 15. For the first quarter of 2024, we expect solar module shipment by CSI Solar to be in the range of 6.1 gigawatts to 6.4 gigawatts, including approximately 235 megawatt of solar module shipment to our own project. Total revenue are expected to be in the range of $1.2 billion to $1.4 billion. As Yan mentioned, in this business, we are constantly balancing between margin and volume with our focus on profitable growth. Our conscious decision to control volume will generate an improved gross margin expectation between 17% to 19%. This improvement is further bolstered by e-STORAGE's more meaningful profit contribution. For the full year 2024, we reiterate CSI Solar's total solar module shipments guidance to be in the range of 42 gigawatts to 47 gigawatts. CSI Solar battery storage shipment are expected to be between 6 to 6.4 -- 6 gigawatt hours to 6.5 gigawatt hours, reflecting significant contribution on revenue and profitability. We also reiterate revenue guidance for the full year 2024, which we expect to be in a range of $8.5 billion to $9.5 billion. Finally, let me speak to our view of the market growth trajectory. Coming out of a challenging 2023, we are optimistic about 2024. We expect to see a rebound in demand as distributed generation market have cleared channel inventory and emerging market post to unleash its potential. As supply and demand rebalance toward the second half of the year, we expect potential improvement in pricing, especially of TOPCon solar module products. We differentiate between industry overcapacity versus oversupply as not all capacity is truly effective. Possessing the technology bankability and reliability that our customers' project need. As the market undergoes further normalization and consolidation, we see vertical integration, advanced technologies and a robust go-to-market strategy as key to competitive edge. With its strong global track record, Canadian Solar has built unparalleled trust over the past two decades. Our steadfast commitment to profitable growth, combined with our long-term strategic investments, enables us to deliver enduring value to our shareholders. With that, I would now like to open the floor for questions. Operator?

Thank you. At this time, we'll be conducting a question-and-answer session. [Operator Instructions] Our first question comes from the line of Colin Rusch with Oppenheimer. Please proceed with your question.

Thanks so much, guys. And I guess the first question is really around the pricing dynamics and strategy for the energy storage business. Obviously, there's a lot that's been going on around the supply chain and there's an awful lot of demand. So I just want to understand how you guys are thinking about passing on some of the cost reduction on the cells relative to trying to take advantage of some of the intense demand that we're seeing out there.

Yeah, Colin. I will give a simple answer, and then let's see, if Yan have anything to add. Yes. If the battery cell or if the material mainly leasing carbonate price go down, we always pass the value to our customers. However, the e-STORAGE product typically has a very long contracting period. So some of -- well, actually, most of our contract which we will deliver this year were contracted at least 12 months ago. So we create -- we took risk and our customer also takes risk. And the pricing we give to our customer allowed our customer to achieve their financial goals. Therefore, both sides are happy. But moving forward, if we see, long -- let's say, a long-term trend of the easing of the lithium carbonate price, we always pass the -- this value pass the saving to our customer.

That's super helpful. I guess the second question -- the second question is around interconnection queues and time frames, if you guys have the right technology portfolio. So as we've seen, interconnection queues extend out a little bit here over the last few years. And as you diversify some of the end markets that you're doing some of these larger developments with, are you seeing opportunities for integration of incremental technology? Would you guys start to bring that in-house? Is storage enough to really deal with that and how do you know those interconnection queues evolving here over the next couple of years?

Ismael, this is a question about the interconnection queue. Do you want to answer this question?

Sure. Happy to take it. Thank you, Shawn. Look, we keep on seeing delays, Colin. Hi, by the way, thanks for the question. We keep on seeing delays. Things are getting worse and worse in PGM, for instance, you probably saw that they stopped taking more applications recently. That's why we believe that our 12 gigawatts of interconnection granted already has very strong value. And the 14 gigawatt hours we have of storage already granted of interconnections have a huge value too. We don't think that it's going to ease. I think it's going to be getting more and more difficult. And the main things that we are starting to think about is, how can we start being less demanding on the network and start to use storage behind the mirror more and even have plants that are serving directly an application, like, for instance data centers or desalination platforms and all this kind of stuff, so that we can serve directly the load instead of having an agreed need it. Those are the things we are working on. I don't think it's going to get easier. I think it's going to get worse. That's my presence.

Okay. I'll take the rest of it offline. Thanks so much, guys.

Thank you, Colin.

Thank you. Our next question comes from the line of Vikram Bagri with Citi. Please proceed with your question.

Good morning, everyone. I was wondering like the implied valuation of CSI Solar were -- and your investment from BlackRock is significantly higher than where the stock is trading. I was wondering, if any thoughts on how you can close this valuation gap. Do you -- is there a strategy to close that valuation gap?

That's a very good question. Actually, I don't know how to answer it. However, we will present this in all of our investor meetings and let investment community to see this gap, to see this mismatch of the value. And I hope after a while people will understand that there's big -- indeed a big gap between the -- not only the value by BlackRock of our recurring business, but also the market cap of our CSI Solar business. If you add that two-part together, it's way higher than CSIQ's market cap. Yes, we all see it. And we're -- I mean, we have been constantly looking for ways to close this gap.

Thank you. And on the same topic, storage business that you have is roughly now as large as one of the publicly traded peers and will be relatively large within CSI segment as well. Would you look to break out this business separately this year, both on the revenues and margin for storage? And if you can share what your margin outlook is for storage, that will be helpful as well.

Well, again, another very good suggestion. As I said, we always look for ways to maximize to increase the shareholder value. However, carve out a business is not an easy task. So I don't think we can carve out e-STORAGE this year. However, as I said, moving forward, we'll always look at interested in every method to maximize the shareholder value.

Great. And then one final question before I pass it on. Impressive module shipments in fourth quarter, I was wondering what surprised you on the upside leading to the above guidance volume, especially in such a challenged market. And on the same topic, can you share how much of the guided volumes for 2024 on module side are already contracted versus what you need to still contract? Thank you.

Well, so 2024 is actually pretty unique year because we all know that in Q1 we're actually in -- the industry is under pressure on margin. Price came down pretty fast since Q4 last year. So -- but however, we're expecting the second half of bouncing back, Q2 is likely to be a transition quarter. So if you ask me, we'll kind of try to make the right balance between margin and volume. So we believe this year is going to be uptrend year. So we believe that the distribution -- distributed generation, which is the distribution channel price will bounce back and actually we're going to have a better margin moving forward. But the contracts for that channel always signed, like, a few weeks before shipment. But we have a very loyal channel, right, worldwide in that channel. So we have a very high confidence volume from the distributors and leading sellers around the world. So for -- and also for U.S. market, which is right now the highest priced and market with the highest margin, we have a very high proportion of our capacity signed up already, and especially for the more profitable, even more profitable US factory volume. So for other markets, it really depends. So, for example, in Japan and some higher price market we have a higher proportion of signed order, if it is low priced market, we try to manage the pace. However, we do see some markets demand really coming up very strong even now, as early as March, which is Pakistan. So we're locking up volume at a pretty healthy price right now.

Thanks for that.

Right. So I'll add few comments. I will add a few comments on Yan's comment. You asked us how much of a guided volume -- annual volume of contracted. As I mentioned in the guidance section, for Q1, we strategically decided to control the volume in order to protect the margin. Therefore, with this strategy, this moment, we strategically try not to contract too much of the 2024 annual volume into long-term contract. Because we believe, as Yan said, the pricing will improve. We think the module pricing in some of the market is very -- too depressed which is -- which will improve. It has to improve. So Yan would rather want our sales team to control the volume so that we can pick up better priced contract later in the year. But we do believe that both the volume and the price, well, actually the volume is there, but we want a better price before we commit into the volume.

Thanks, everyone.

Thank you. Our next question comes from the line of Philip Shen with ROTH MKM. Please proceed with your question.

Hi, everyone. Thanks for taking my questions. As a follow-up on that last thread in terms of pricing, I think Shawn and Yan, you guys have talked about, you expect pricing to improve -- it has to improve, Shawn, you just said. Can you quantify this in any way, specifically, I think our rough estimate for your module ASP in Q4, and it could be wrong, but we have roughly $0.15 a watt. What do you think that module ASP on an actual basis could be for you in Q1, Q2 and Q3? Thanks.

Well, we are not guiding the Q1 ASP, but we give you the gross margin guidance, which is 17% to 19%. But in order to get this gross margin, we sacrificed on volume. So Yan said, we control volume. We only plan to ship 6.1 gigawatt to 6.4 gigawatt. As you notice that we shipped over 8 gigawatt in Q4. So obviously we have the capacity to ship at least 8 gigawatt, if not more, but we decided to control the volume. And now moving forward, we think the modules ASP in later quarters should be in part, if not better than the Q4 ASP. Let's put it that way, that's -- Yan and I have this view. Let's see whether we are right or not.

Got it. Okay. And what do you think are the dynamics that result in the better pricing? You said it has to improve. So what are the assumptions in your conclusion that it has to improve? We've heard that the channel inventory in Europe has cleared for DG. We've heard now if you -- if the customers in Europe want to order modules, they have to get a production slot. So can you talk about the utilization rates for the manufacturers in Asia, in China and Southeast Asia? Is it substantially lower now to control the supply? So can you elaborate, Shawn, on why things have to improve? Thanks.

Okay. So Philip, well, I think, first of all, if you look at China and overseas market, China market, actually we believe this year's growth is going to be some moderate growth because last year it just grew too much. But this year we still believe it's going to be growth, but it's going to be moderate. Overseas, we're going to see strong shipment into the channel, in distribution channel because that channel was blocked since Q3 last year and the destocking actually has completed mostly. So we're seeing the demand is bouncing back with the pricing improvement already in both U.S. and Europe and Australia. And we also see new markets like Pakistan is growing pretty rapidly as a very strong demand in Q2 already starting. So utility market will have growth, may not be a revolution of growth, but it will grow. So we expect this year's total installation, it's going to be like 20% growth comparing to last year. If that is the assumption, then we see that -- moving into second half of the year, we should see the ones with TOPCon capacity will actually have much better pricing. And we also see the capacity, as we mentioned already, Shawn mentioned that already, capacity versus oversupply because bankable capacity is actually comparing to the seasonal high demand in second half. Remember, the second half demand is going to be much higher than first half. So in few months’ time, you're going to see a very high demand versus the effective capacity. Effective capacity means bankable, meaning with the right cost and features and also some -- the capacity that can over kind of maneuver around the trade barriers and traceability and ESG issues. So that's why we believe it will actually go up in second half.

Great, Yan. That's very helpful. Thank you. Shifting over to the UFLPA situation in the U.S. Can you talk through if your imports into the U.S. are still being detained, if so, what percentage is it like a very small percentage sub 10% or is it modest and maybe like closer to 10% to 30% of your imports into the U.S. might be detained? And do you have a sense for -- if you are detained in that at all, what's the timeline as to when those tensions might be released? Thanks.

Philip, I can only say to you that we get most of our volume released and imported into U.S. Now, I can't predict, however, I can't predict how CP -- CBP respond or process every lot, which they have questions. So this is not something I can predict, but the historical pattern from other suppliers. So I suggest you go, I mean, maybe you can draw reference from what you see from other importers.

Okay. Thank you, Shawn. One last one. In terms of storage, can you give a little bit more color on the outlook for growth and margins? Some of our checks suggest you guys may have recently cut your storage pricing meaningfully, maybe 10% to 20% cheaper versus peers. We're also hearing that you're telling customers that you may want to own all the data. Can you talk about the rationale for some of these actions? Thanks.

I didn't quite get your question. Who said we are cutting price 10%, 15%?

10% to 20%. One of -- one of your -- well, I can't share exactly who, but somebody in the storage ecosystem was highlighting that your pricing was reduced in storage meaningfully recently and so you might be 10% to 20% cheaper versus peers. It's only from one source. I haven't fully verified everything, but just curious, have you guys recently reduced pricing meaningfully?

Well, if we are 10%, 15% below peers, I'm very happy because we are still getting very good margin on the e-STORAGE product that probably shows our very strong cost control and competitiveness. As I said to Colin's question that when the battery cell price go down and leasing carbonate price go down, we do cost on some of that savings to our customer. So it's not surprising that if some of the price we offer today is better, is lower than the price we offered a year ago or two years ago, so that won't surprise me.

So, Philip, once again, we are not selling cheaper than our peers. If we're selling 10% lower, that's the market price.

Great. Really appreciate the color. Thank you, guys. I'll pass it on.

Thank you. Our next question comes from the line of Brian Lee with Goldman Sachs. Please proceed with your question.

Hey, guys. Thanks for taking the questions. I had a couple sort of modeling/housekeeping ones. Huifeng, you mentioned a write-down in the quarter. How much did that impact gross margins for CSI Solar in 4Q and it sounds like, I guess, no residual impact is expected going forward?

About a couple of points, it's a combination of subtle one trade case and some write-down. And then when we ramp up the TOPCon cell manufacturing, in the process, there is expense in ramp-up the efficiency and getting know how, so that process is also completed. So going forward, we should be okay.

Okay. So a couple of 100 bps. Understood. And then, for your Q1 margin guidance, had a couple of questions around that. I guess, first off, are you assuming either for Q1 guidance or maybe just give us your thought process around how you're guiding and embedding it in for the rest of the year? Any impacts from IRA credits?

Yeah. The U.S. module manufacturing started end of last year and now quickly ramping up, so we'll pick up some manufacturing credits. But more important is that our TOPCon ramp up also completed in China, so that's very helpful. And then also battery storage will contribute significant profit margin to CSI Solar. So everything working together, I think we have seen the worst have passed.

Okay. Is there -- I mean, I suppose we can kind of back into it, but can you give us a ballpark range of what IRA impact is for Q1 guidance on gross margin and then what that could become over the course of '24 as you ramp additional volume in the U.S.?

I can't -- we don't disclose all these details, but I can share with you the framework later on.

Okay. Fair enough. We'll take that offline. I guess, on e-STORAGE, if you look at the revenue breakout you guys provide, obviously, it seems like battery storage revenue was pretty significant in Q4, and CSI Solar still only managed to do a 12% gross margin. You're obviously saying e-STORAGE margins are contributing going forward. So this question would be what is presumably e-STORAGE gross margins are higher than solar module margins embedded in your Q1 guide. Is it fair to assume that for the balance of '24 e-STORAGE gross margins would remain above your gross margins for solar modules?

I cannot confirm. Quantitatively, I think you are thinking the right direction.

Well, it is, I can confirm.

Thank you, Yan. Okay. That's helpful.

Thank you, again.

Is there any -- I mean, directionally, it seems like it's above. I mean, we're talking about a meaningful delta between what you're making on storage versus solar module only?

I can say that for 2024, the gross margin for e-STORAGE is around 20%.

Great. That's helpful. Last one for me and I'll pass it on. All this color is super helpful from a modeling perspective. If I look at your storage volume targets, and then I look at kind of where pricing is for solar panels versus where they started the year. It kind of -- and you're basically at the midpoint implying about $1 billion of incremental revenue growth '24 versus 23. It seems like almost all of it is coming from storage and very little revenue growth in modules. I guess, one, is that the right assumption? And then two, what should we be thinking about the energy business you did about $500 million of revenue in '23. Presumably, that would be flat or down given you're hanging on to some projects or what should the directionality of modeling for revenue across the three buckets look like module versus battery? Obviously battery up a lot, maybe all of it, but module versus energy in terms of revenue growth year-on-year.

Yeah. This is Shawn speaking. We will see some revenue growth even on the solar module side, although, the module growth is not proportional to the volume growth because of the ASP job from 2023 to 2024. But meanwhile, yes, you are right, the e-STORAGE revenue growth will be significant. The e-STORAGE revenue, first of all, volume-wise e-STORAGE will grow from less than two gigawatt hour in 2023 to 6 gigawatt hour to 6.5 gigawatt hour in 2024. Now, the ASP for this storage also dropped a little bit comparing with 2023, but not that significant. So yes, the revenue growth of e-STORAGE will be very strong. On the Recurrent side, you are also right that we will hold on -- plan to hold on most of our project in U.S. and in Europe. We will probably sell some of our project in Latin America and in Japan. But overall, we are holding more assets, a lot more assets this year. So you are not going to see that much revenue contribution from Recurrent. However, we are building a significant recurring revenue by holding the project. So in a year or so -- in 2025 or 2026 time zone, you will see strong -- start to see strong revenue contribution from Recurrent.

Okay. Thanks, everyone. Thank you, Shawn. I appreciate. I'll pass it on.

Thank you. Ladies and gentlemen, we've come to the end of our time allowed for questions. I'll turn the floor back to management for any final comments.

Thank you for joining us today and for your continued support. If you have any questions or would like to set up a call, please contact our Investor Relations team. Take care and have a nice day.

Thank you. This concludes today's conference call. You may disconnect your lines at this time. Thank you for your participation.