2008 Results   -- Q4 net revenues of $73.0 million, compared to Q4 2007 net revenues of      $127.5 million and Q3 2008 net revenues of $252.4 million.   -- Q4 net loss per diluted share of $1.42 compared to Q3 net income per      diluted share of $0.31.   -- Full year 2008 net revenues of $709.2 million, a 134% increase over      full year 2007 net revenues of $302.8 million.   -- Q4 shipments of 19.6 MW, bringing full year 2008 shipments to 167.5 MW,      a 100% increase over full year 2007 shipments of 83.4 MW.   -- December 31, 2008 cash position of $136.2 million, accounts receivables      of $50.6 million and debt to equity ratio of 47%.    2009 Outlook and Developments   -- Full year 2009 net revenue guidance of $600 to $800 million on      shipments of 300 to 350 MW.   -- Approximately 262 MW of projected 2009 module sales (74 - 87% of      guidance) secured by contracts. Approximately 120 MW of the current      contracts are for e-Modules.    

Canadian Solar Inc. (the "Company," "Canadian Solar" or "we") today reported its unaudited US GAAP financial information for the fourth quarter and the year ended December 31, 2008.

Net revenues for the quarter were $73.0 million (including $5.4 million of silicon material sales), compared to net revenues of $127.5 million for the fourth quarter of 2007 (including $2.4 million of silicon materials sales) and $252.4 million for the third quarter of 2008 (including $nil of silicon materials sales). Net loss for the quarter was $50.6 million, or $1.42 per diluted share, compared to a net income of $6.0 million, or $0.21 per diluted share, for the fourth quarter of 2007 and net income of $11.1 million, or $0.31 per diluted share, for the third quarter of 2008. Excluding share-based compensation expenses of $1.0 million, non-GAAP net loss for the quarter would have been $49.6 million, or $1.39 per diluted share.

The net loss in the fourth quarter included a $23.3 million write-down for inventory against the net realizable value of inventories as a result of the rapid decrease in the market price and value of feedstock, work-in-progress and finished solar modules. The net loss also included a $12.8 million provision for doubtful accounts. The inventory write-down appears on the income statement as a component of cost of goods sold, while the provision for doubtful accounts appears in the income statement as a component of the SG & A expenses. The Company has $136.2M cash at the end of the quarter. Accounts receivables at the end of the quarter were $50.6 million compared with $153.1 million at the end of Q3. Over the same period the Company paid down approximately $78 million in short term and related party debt.

Net revenues for 2008 were $709.2 million, compared to $302.8 million for 2007, an increase of 134% per year. Net loss for 2008 was $10.0 million, or $0.32 per diluted share, compared to net loss of $0.2 million, or $0.01 per diluted share, for 2007. Excluding share-based compensation expenses of $9.1 million and debt conversion expenses of $10.2 million, non-GAAP net income for 2008 would have been $9.3 million, or $0.29 per diluted share.

Our effective management helped us to mitigate the impact of foreign exchange fluctuation in 2008. The total foreign exchange loss net of hedging gain on financial instruments was $5.6 million for the full year 2008.

Dr. Shawn Qu, Chairman and CEO of Canadian Solar, commented: ''The end of 2008 was a challenging time for Canadian Solar and for the industry. In Q4, difficult credit conditions for our customers, market-wide module and raw materials inventory price declines and winter weather in Germany directly affected our revenue growth and profitability. Despite these macroeconomic headwinds, we continued to post solid sales to paying customers and to maintain financial discipline. We ended the year with $709.2 million in annual net revenues, a 134% increase over full year 2007, and approximately $136 million in cash, an impressive accomplishment in such tough times. Some of these challenges will persist well into 2009. Nevertheless, Canadian Solar is well positioned to ride out the market turbulence and emerge as an even more successful player. Our strategy will continue to include protecting our balance sheet, maintaining and improving relationships with our high-quality customers who are larger, long-term solar players and to improving our already very competitive cost structure. We expect to achieve wafer to module processing costs of $0.60 per watt and polysilicon to module processing costs of $0.90 per watt by the end of Q2 2009. We believe our ongoing R&D will further improve our products and cost structure, and distinguish us from many of our competitors.''

Arthur Chien, CFO of Canadian Solar, noted: ''We are encouraged by our ability to weather the current economic storm to date, especially as seen in our cash generation and healthy balance sheet. We exercised prudent financial management principles by writing down the value of inventory and making provisions for doubtful accounts. These balance sheet provisions did however significantly affect our quarterly and annual results. We expect to see improved gross margins in Q2 2009 and achieve our guidance margins in H2 once older inventory has been used and as we benefit from lower raw materials pricing. It should also be noted that subsequent to our Q4 pre-release approximately $8 million of long-term debt was reclassified as short-term debt. We believe our strong cash position, low accounts receivables and our access to additional short and long term financing through the support of our local banks are sufficient for our working capital requirements, while retaining our ability to increase capital expenditures that will help to increase our margins and capacity over the long term.''

                                        Q408          Q308          Q407         Region                     Revenue   %   Revenue   %   Revenue   %   Europe                            57.0  78.1%  222.4  88.1%  124.1  97.3%   Asia                               9.6  13.1%   16.5   6.5%    2.9   2.3%   America                            6.4   8.8%   13.5   5.4%    0.5   0.4%   Total Net Revenue                 73.0   100%  252.4   100%  127.5   100%                                                 FY08              FY07        Region                            Revenue     %     Revenue     %   Europe                                  635.3    89.6%    286.6    94.6%   Asia                                     41.6     5.9%     13.6     4.5%   America                                  32.3     4.5%      2.6     0.9%   Total Net Revenue                       709.2     100%    302.8     100%      Recent Developments   -- Opened the cell research center, with cell efficiency targets of 18.5%      for mono-crystalline cells, 16.5% for multi-crystalline cells and 15.5%      for solar grade cells used in e-Modules by year-end 2009.   -- Moved the principal place of business of our U.S. subsidiary to San      Ramon, California in January 2009.   -- Achieved 120-150 MW of ingot and wafer capacity and 270 MW of cell      capacity in 2008.   -- Renegotiated the prices and payment terms with certain wafer suppliers      reflecting the change in the market conditions. Further discussions are      currently ongoing with our strategic suppliers to adjust our long-term      supply contracts.   -- Customers installed and obtained financing for estimated 10-12 MW of      e-Modules in 2008 with up to 120 MW of installations expected in 2009.      Canadian Solar now has more than one year of field data from successful      installations of this product and from test installations.     Outlook  

Based on current customer orders, market forecasts and supply contracts, we are offering guidance on full year 2009 shipments of 300 to 350 MW, with net revenues of $600 to $800 million. Achieving our guidance assumes improved macroeconomic conditions in H2 2009. With our disciplined financial management, strong customer and supplier ties, and flexible vertical integration model, we believe that we are currently on track to achieve shipment and revenue guidance.

To protect cash flow from Euro sales against USD exchange rate fluctuation, for the first half of 2009 we transacted 128 million Euros in economic hedges with forward contracts and collars at pricing between 1.36 and 1.49 Euros per U.S.