Good afternoon everyone and welcome to the First Solar’s second quarter 2013 earnings call. This call is being webcast live on the Investors' section of First Solar's website at firstsolar.com. At this time, all participants are in a listen-only mode. As a reminder, today's call is being recorded. I would now like to turn the call over to David Brady, Vice President of Treasury and Investor Relations for First Solar. Mr. Brady, you may begin.

Good afternoon, everyone, and thank you for joining us. Today the company issued a press release announcing its financial results for the second quarter. A copy of the press release and the presentation are available on the Investors' section of First Solar's website at firstsolar.com. With me today are Jim Hughes, Chief Executive Officer, and Mark Widmar, Chief Financial Officer. Jim will provide an update on significant business and technology development and then Mark will discuss the second quarter results and provide updated guidance for 2013. We will then open up the call for questions. Most of the financial numbers reported and discussed on today's call are based on U.S. Generally Accepted Accounting Principles, in the few cases where we report non-GAAP measures, we have provided the reconciliation to GAAP equivalent at the back of our presentation. Please note that during the course of this call, the company will make projections and other comments that are forward-looking statements within the meaning of the federal securities laws. The forward-looking statements in this call are based on current information and expectations and are subject to uncertainties and changes in circumstances, and do not constitute guarantees of future performance. Those statements involve a number of factors that could cause actual results to differ materially from those statements, including the risks as described in the company's most recent Annual Report on Form 10-K and other filings with the Securities and Exchange Commission. First Solar assumes no obligation to update any forward-looking information contained in this call or with respect to the announcements described herein. It is now my pleasure to introduce Jim Hughes, Chief Executive Officer. Jim?

Thanks David. Good afternoon and thanks for joining us for our second quarter 2013 earnings call. Today, we announced the new technology and commercial collaboration agreement with General Electric, with the intent to advance cadmium-telluride thin-film solar cells and modules. Under the agreement, we acquire all of GE’s cadmium-telluride solar intellectual property and they receive 1.75 million shares of our Solar stock, making GE one of our top end shareholders. GE currently holds the efficiency record for a 10-cell research cell at 19.6%, which eclipsed the recent First Solar cell record at 18.7%. GE high efficiency cells employ technologies which are quite distinct from those being developed at First Solar and yet are consistent with our manufacturing platform. This is why we are excited to purchase their IP in this transaction. GE has over 450 issued patents and pending applications on their 10-cell technology which effectively doubles our patent position. The combination of the company’s complementary technologies and First Solar’s existing manufacturing capabilities are expected to accelerate the development of test cells over module performance and create significant improvements in efficiency at full manufacturing scale. GE Global Research and First Solar research and development will also collaborate on future technology development to further advance cadmium-telluride solar technology. This transaction builds upon our existing commercial relationship on solar inverter technology. GE will provide us with a new GE pro solar 4MW 1500 volt inverter optimized for large utility scale systems. In addition, First Solar will continue to purchase advanced inverters from GE Energy Management for use in First Solar’s global solar deployments. By combining complementary technologies, the collaboration is expected to lead to an improvement in solar grid integration, more competitive cost structures and create a roadmap for combined electrical equipment. GE, which has 34GW of renewable energy installed globally, will…

Thanks Jim and good afternoon. Turning to slide 11, I would like to begin by highlighting second quarter operational performance. Production in the quarter was 389 megawatt DC, up 5% both on a sequential basis and on year-on-year comparison. But comparing production year-over-year, including the German manufacturing volume in the second quarter 2012, production in Q2 2013 was up 23%, based on improved module efficiency and utilization on the same number of production months. On a sequential basis, the increase in production volumes is reflective of the commencement of re-ramping production lines that have undergone planned equipment upgrades, which when completed is expected to enable the achievement of near term targets on our module cost and efficiency improvement roadmaps. In the second quarter, we ran our factories at approximately 75% capacity utilization, flat to the prior quarter and up 12 percentage points compared to the second quarter of 2012. Our module manufacturing cost per watt for the second quarter fell to $0.67. On a comparable basis, cost per watt decrease $0.02 quarter-over-quarter or approximately 3% and is reflective of higher throughput, increased module efficiency and lower core manufacturing costs. Excluding the impact of un-utilization, our core manufacturing cost per watt fell to $0.63, a $0.01 improvement compared to the prior quarter. During Q2, our best plant manufacturing cost at full utilization remained at $0.62 per watt. As reflective of the fact that this lead line (tail end) has yet to receive the line upgrades that are currently being rolled out. When the upgrades are completed though, we anticipate the lead line module cost to be approximately $0.57 per watt. This assumes our current module manufacturing costs that are (tail end) lead line with 14% efficiency. Conversion efficiency for the quarter increased to 13% and is expected to make an increasing…

(Operator Instructions) We'll go first to Patrick Jobin with Credit Suisse.

This is Brandon Heiken speaking on behalf of Patrick Jobin. Thanks for taking my question guys. I was wondering if you could quantify each of the different factors that are contributing to the changing guidance, specifically how much do you think of pricing benefit. Do you expect from holding some of these projects to completion and the other contributions as well, please?

So the impact on Macho and Solar Gen holding those assets through COD is now reflected obviously in the current year. It’s had an adverse impact on the current year because we pushed the revenue and the associated earnings out into 2014. But what I would say is that if you look at ABW, if you try and understand the impact of selling down a notice to proceed versus DOD, I mean ABW I think is a great example of where we have been able to achieve upsized economics by being patient in actually selling an asset that's up and operational. When you look to the impact to the change in guidance on operating income, we came down about $25 million. $10 million of that is the associated impact of the two acquisitions. So we have incremental R&D expenses for Apollo, as well as incremental costs associated with the Element acquisition. So that's $10 million. The $15 million of it was the net impact of movement out of Solar Gen’s Macho, offsetting by improved economics on a handful of projects, but cost pressures that we’re experiencing on AVSR.

We'll move next to Brian Lee with Goldman Sachs. Brian Lee – Goldman Sachs & Co.: So I guess on the two projects that you are holding to a completion, can you quantify the specific impact that it had to lowering the 2013 EPS outlook. And is it fair to assume these projects are now going to be fully recognized in 2014? And if so, what's the incremental EPS benefit for the delayed sale?

So they will all -- they both will be recognized in 2014. So it is just moving on, '13 into '14, so no issue from that standpoint. We are not qualifying the exact impact of movement of those projects out of the year. However as I indicated, the aggregate impact of a number of movement of projects, whether it's the impact of Solar Gen and Macho moving out, plus the incremental AVSR costs that we’re occurring because of delays in that project, offsetted by the improved economics on ABW, improved cost performance on Campo, improved performance on Imperial valley. All that nets the $15 million. So I’m not going to give you each of the pieces that add up to the $15 million, but net-net, you lost $200 million of revenue that fell out of the year, when you incorporate the whole mix of the portfolio items that I just referenced to you, changed our number by about $15 million.

And Sanjay Shrestha with Lazard Capital Markets has our next question. Sanjay Shrestha – Lazard Capital Markets: Two part question, real quick, first on this module supply agreement with GE. Wondering if you guys can actually give any more color on that as to if there is any firm commitment of volume or timing and things along those lines. And two, on the Element Power, can you give us a sense of the stage of that 1.5 gigawatt pipeline that's you guys brought and how much of that is actually something that could contribute to P&L in 2014? Thank you.

With respect to the GE transaction, there is a specific commitment, purchase obligation and then there is a larger commitment that has agreed pricing and extends over extended period of years. I don't think we have detailed in the press release the exact numbers. If so we'll get back to you with them. I don't want to get into more detail than we’ve put out in the press release. But it does involves the specific commitment and we contemplate that we will see near term benefit from access to the GE sales force, particularly on high grid installations of both wind and thermal assets where they believe they have the ability to market photovoltaic asset alongside. And then, the second half of the question, Element. On the Element transaction, it's a mix of early, mid and late stage projects. But there are indeed some opportunities that are far enough along that we believe they would be a contributor in 2014.

We will hear now from Vishal Shah with Deutsche Bank. Vishal Shah – Deutsche Bank Securities: On the Element transaction, given that you haven’t disclosed the amount, I’m assuming it’s not a big number. Curious to understand what the current rate of project sales would be in terms of the acquisition cost of new assets. Are we still looking in the $0.10, $0.15 range? That was the number that some of the other transactions were happening. And then on the GE transaction, I’m wondering what targets you have now that you’ve acquired this technology. Do you plan to update your long-term cost and efficiency targets? And the $35 million transaction, wondering what that would mean in terms of your R&D roadmap going forward. Thank you.

Let me start with the second question. In terms of cost and technology roadmap, we certainly expect over time to update that roadmap once we have an opportunity to fully determine how we best integrate their technology into our roadmap, determine the proper sequencing in terms of upgrading of equipment and what it means in terms of our profits as that will take time. I would guess that you could probably look towards next year's Analyst Day as the time at which we would be able to provide specifics around what we think the results of the acquisition will be. But based on the transaction and based on the value that we attributed to it upon a belief that there will be specific intangible improvements both in terms of timing and in terms of absolute outcome of the technology road map. So, we in fact do believe that it is additive in that regard. On the Element transaction, the $0.10 to $0.15, that tends to be the kind of value you see paid for fully mature opportunities that include a PPA. Most of the Element transaction is strategic site positions and the interconnect positions and does not include a PPA. We see values in portfolio acquisitions all over the map depending upon exactly how strategic the positions are, and I think it's very difficult to generalize and we haven’t provided the specific number on this transaction.

The one other thing I would just comment, just about -- and we have referenced this before, when you think about the benefit of the efficiency gains that you can capture, and we have highlighted this before, about 100 basis points benefit across the module and across the BOS on an installed system base is somewhere around $0.08 to $0.10. So when you think about it's a capability that we now have with leveraging the knowledge in the IP that we've acquired. If we can capture even a small percentage of that 100 basis points, that's incremental. When you take that across $0.08 to $0.10 a watt and 2 to 3 gigawatts of production capability install, is major, it's very significant. So that's the way you need to think that and keep it in perspective around relative the acquisition price.

Yeah. We certainly believe that at our current production rate, any sort of meaningful increase in the overall efficiency acceleration of the timetable would have a very short payback period as a result of that leverage that Mark refers to.

And we will move on to Shahriar Pourreza with Citi.

Just one question, obviously, with you potentially holding some of the assets, I'm sort of wondering whether the equity offering to some of the proceeds could be used to contract, build, develop and own the assets and potentially doing some sort of a YieldCo transaction. Is that something that you're seeing potentially with like Macho Springs and additional assets?

We've clearly indicated in discussing the equity offering and on prior conference calls that we are watching in the marketplace the outcome of the various efforts to create YieldCos with respect to renewable assets. We think it's going to be a meaningful capital structure for the industry going forward and we are actively evaluating how we should participate. Whether we should view them as customers that could pay higher value or whether we should have a captive vehicle. But as we retain assets in order to maximize the value of those assets upon monetization, clearly one of the alternatives that we will be evaluating as we move forward is a YieldCo. No decision has been made, no specific effort. We're not specifically headed in that direction but we are looking hard at evaluating the results of the operations. The recent NRG transaction, there are other representative transactions in the market place. There are similar vehicles traded in the UK. All of that provides market data for us to look and compare that to what we think the financial results of monetizing our captive portfolio would be. It gives us a nice comparison. So, it's something we're actively considering but not something we're prepared to say we're definitively doing at this point.

We will go next to Stephen Chin with UBS.

Just a question on the cost per watt improvement. Jim, I was just wondering if you could talk about what kind of gains you are thinking can be achieved with the TetraSun technology and you can maybe elaborate on any other additional capabilities that you see could come from GE's cad-tell portfolio that could help drive this cost lower.

Well, the TetraSun portfolio, that is a basic high efficiency, low cost technology in and of itself. It primarily will deliver a benefit in the distributed or constrained space market. It will be at a higher cost per watt level than our cadmium-telluride technology, but will be at a much higher efficiency. So the benefit of that higher efficiency will be derived out of circumstances where you have a high balance of system costs, primarily constrained spaces such as rooftops or tight commercial and industrial locations. We provided guidance as to some of the cost expectations at the Analyst Day. We have not updated that, but we have said here that our work to-date has validated those expectations. With respect to the Cad-Tell, we have an existing roadmap that's out there. GE has been working on the technology in parallel to us. We have been leapfrogging one another in terms of record sales, but we’ve been doing so with distinctly different approaches. When we chose to take a look at their technology, what we found much to our happiness was that the approaches they’re using are not inconsistent with ours. In other words, they can be additive to our roadmap and that's the reason for the acquisition. We have not committed to specific results in terms of how it affects the roadmap because that will require work in the laboratory. It will require integrating their technologies into our existing technology and we simply don’t have data yet. But we strongly believe that it will be additive, but we’re not prepared to quantify that at this time.

And we'll go next to Krish Shankar with Bank of America Merrill Lynch. Andrew Hughes – Bank of America Merrill Lynch: This is Andrew Hughes for Krish. A quick question on the Element transaction, the portion of that pipeline that you’ve characterized as late stage, I’m wondering if that means those projects have PPAs. And then with the broader 8 gigawatt long term opportunity, just a little more color perhaps around what a moderate chance of conversion is on those mid-to-late stages and if all of the 1 gigawatts of module-only sales are included in that figure or spread between the mid and early? Thanks.

In terms of where the module-only sales fall between -- the spread between categories, I don't know that off the top of my head and I'm not sure that's the level of detail we'd be willing to provide. In terms of the rest of it, in terms of conversion rates, we've not provided a specific number in terms of conversion rate. But I would say that with respect to the mid and late-stage projects, we believe that those are all projects that have a significant -- a meaningful probability of coming into existence as they sail as opposed to merely a specifically identified opportunity. Much of the early stage consists of specifically identified opportunity. They are a volume. They are a customer or captive opportunity. They have an identified market into which the electricity would be sold. But they may not have all of the elements that yet give rise to a meaningful probability. The things that we would characterize as mid to late stage are all projects that have sufficient elements in place, whether that's permitting, whether that's near-term off-take, whatever it may be that leads us to believe that there is a meaningful probability that those opportunities will be converted. So obviously it's a continuum. There is no one bright line. But that's how we would characterize those that fall under the early stage versus the mid to late stage.

Moving on to Daniel Ries with Maxim Group. Dan Ries – Maxim Group: With your team out there discussing projects all over the world, do you have an estimate at this point for the size of the utility scale market in say 2016, perhaps both with and without China? And can you say what portion of that are you targeting? Are there areas where you are not targeting for one reason or another?

Sure. If you step out to 2016, when we look at all of the various estimates that are out there in terms of our own analysis of the market as well as research organizations and investment banks, you will see numbers that vary from probably mid-40s on the low end to 60 or 65 gigawatts from the high-end in terms of solar market. In the split of that market between utility scale and non-utility scale, you will see estimates that vary anywhere from something approaching 50:50 to something that looks more like 60:40 or 65:35. I'm not sure. I think directionally we feel like those are probably the midpoints and those are probably as good a proxy as we think. One of the things I have said, that we continue to believe is the outcome in terms of total market size maybe heavily influenced by overall levels of economic activity. So, you could easily see a 10 or 15 gigawatts swing in the total market size based on different economic scenarios and the related commodity price impact of those scenarios. So, that those bands are less difference of opinion than probably the spectrum of outcomes that could happen. In terms of how much of that is China, I don't know of the top of my head. I know that a lot of the recent additions to the domestic program that the Chinese have announced have not been factored into those estimates and I don't think we would have factored them fully into the estimates. So, there is probably upside to those numbers in terms of how much of it is China. I also think that one of the things we will see over time is, as utilities and markets, and people began to see the impact of capacity factor on grids, that people may revisit their estimation of distributed generation versus utility scale generation, given that you will have significantly higher capacity factors on the utility scale side. So for a given investment and for a given space within the dispatch order for solar to contribute to reducing the peak, you will get more total electricity out of facilities with a higher capacity factor and we think over time you may see that split revisited as that impact becomes clear to planners.

Next we will hear from Jagadish Iyer with Piper Jaffray.

Just a question on the GE situation. I just wanted to get an understanding of, would you foresee at some point of time using some kind of a GE process in your existing process, maybe two years out given that in your prepared remarks you did say that GE did certainly have a higher efficiency? And as a second part to that question, I was wondering whether, does GE have a back contact solution that you have described in your presentation, in today's earnings?

We won't be discussing any of the specifics of the technologies. But what we have intended by the statements that we made is, yes, we do anticipate sooner than two years that we will be incorporating some of the GE technologies into the product. Very specifically into the product and with that, that incorporating those technologies into the products will be additive to our current technology roadmap. So, that's specifically what we anticipate as a result of the acquisition.

And Paul Coster with JPMorgan has our next question.

It really is a combined question. First, the 8 gigawatt of opportunity you've now assembled, I think 1.5 came from the acquisition this quarter. But what was the rest by geography or by project type to the extent you can share that? And secondly, what is the net effect of this build in the both the pipeline and the timing shifts that you've described in terms of the shape of your revenue and earnings through 2015. Does it kind of smooth out there, anticipated in 2014 a bit?

I think it’s -- with respect to some of the larger acquisitions, it's probably still too early for us to be able to prognosticate what the timing looks like. We will take over the development and implementation of the assets or gain a greater sense of the timing once we do that. In terms of the shape and content, the information that we've provided in the presentation is the level of detail that we're willing to provide at this time. And historically we've not provided any further detail beyond that.

And our final question today will be from Colin Rusch with Northland Capital Markets. Colin Rusch – Northland Capital Markets: You guys laid out an impressive R&D roadmap as you brought things into commercialization. Can you just give us an update on where you are at in context of what you had talked about at your Analyst Day in terms of implementing some of the newer technologies? In the presentation you’re identifying the peak line is flat quarter-over-quarter 14%. Just want to see where you’re at in terms of implementing some of the solutions?

We highlighted that a little bit in the release. So as Jim indicated we’re in the process of rolling out is the improved (back) content, the process across all of our lines. Once we implement that, it will drive our fleet efficiency up to 14%. So if you think about where we are right now on average, it's 13% as we exit Q2. When we sit at the four quarters from now, we'll have fleet average that at least will be at 14% potentially. It could be higher than that. So we are starting to see a step function improvement in terms of the efficiency benefit. Just as we began August, as we indicated as well in the script and some of the comments, we are now running a fleet average of 13.3%, which increased from 13% that that we ended as of June. So we are at 13.3% now. We're on our way to 14%. So I would say we're progressing in line with all of our expectations and the commitments that we made in the Analyst Day around the roadmap. We feel confident with our capability to deliver against that. When you incorporate the learnings now that we'll capture from the IP from GE, we feel that we'll be able to accelerate that roadmap and potentially even take the destination above the 17% or so that we highlighted during the Analyst Day. So from a technology capability standpoint, I think very good about where we are and the opportunities that are in front of us.

And that is all the time we have for questions today. At this time that will conclude today's conference. And we thank you all for joining us.