FINANCIAL STATEMENT SCHEDULE I

DAQO NEW ENERGY CORP.

FINANCIAL INFORMATION OF PARENT COMPANY

BALANCE SHEET

DECEMBER 31, 2011 AND 2012

(In U.S. dollars, except share data)


	December 31,
	2011		2012
ASSETS
CURRENT ASSETS
Cash and cash equivalents	$	3,291,387	$	5,669,834
Prepaid expenses and other current assets		562,500		593,707
Amount due from related party		-		5,110,085

Total current assets		3,853,887		11,373,626
Investments in subsidiaries, net		307,534,867		190,945,888

TOTAL ASSETS	$	311,388,754	$	202,319,514


LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
Accrued expenses and other current liabilities	$	-	$	214,231
Amount due to related party		210,523		-

Total current liabilities		210,523		214,231

EQUITY
Ordinary shares ($0.0001 par value; 500,000,000 shares authorized as of December 31, 2011 and 2012; 175,714,103 and 175,714,103 shares issued as of December 31, 2011 and 2012, respectively and 175,714,103 and 172,877,433 shares outstanding as of December 31, 2011 and 2012, respectively)		17,571		17,288
Additional paid in capital		142,511,581		144,755,902
Retained earnings		150,204,956		38,276,015
Accumulated other comprehensive income		18,444,123		19,551,006
Treasury stock		-		(494,928	)

Total shareholders' equity		311,178,231		202,105,283

TOTAL LIABILITIES AND EQUITY	$	311,388,754	$	202,319,514

FINANCIAL STATEMENT SCHEDULE I

DAQO NEW ENERGY CORP.

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENT OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)

FOR THE YEARS ENDED DECEMBER 31, 2010, 2011 AND 2012

(In U.S. dollars)


	Year ended December 31,
	2010			2011			2012
OPERATING EXPENSES
General and administrative	$	(3,791,827	)	$	(2,355,174	)	$	(3,528,728	)
Research and development		(96,827	)		(75,508	)		(175,242	)

Total operating expenses		(3,888,654	)		(2,430,682	)		(3,703,970	)

LOSS FROM OPERATION		(3,888,654	)		(2,430,682	)		(3,703,970	)
Interest income		-			24,852			3,074

NET LOSS BEFORE SHARE OF RESULTS OF SUBSIDIARIES		(3,888,654	)		(2,405,830	)		(3,700,896	)
Equity in earnings of subsidiaries		72,459,911			35,729,782			(108,228,045	)

NET INCOME (LOSS)	$	68,571,257		$	33,323,952		$	(111,928,941	)
Deemed dividend on Series A convertible redeemable preferred shares		(3,300,000	)		-			-

Net income (loss) attributable to Daqo New Energy Corporation ordinary shareholders	$	65,271,257		$	33,323,952		$	(111,928,941	)

Other comprehensive income:
Foreign currency translation adjustments		5,659,570			12,167,255			2,206,182

Total other comprehensive income		5,659,570			12,167,255			2,206,182

Comprehensive income (loss)	$	74,230,827		$	45,491,207		$	(109,722,759	)

FINANCIAL STATEMENT SCHEDULE I

DAQO NEW ENERGY CORP.

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENT OF CHANGES IN EQUITY

FOR YEARS ENDED DECEMBER 31, 2010, 2011 AND 2012

(In U.S. dollars, except share data)


	Ordinary shares						Treasury Stock			Additional paid in capital			Retained earnings			Accumulated other comprehensive income			Total
	Number			$
Balance at January 1, 2010		100,000,000		$	10,000		$	-		$	258,583		$	51,609,747		$	617,298		$	52,495,628

Net income		-			-			-			-			68,571,257			-			68,571,257
Other comprehensive income		-			-			-			-			-			5,659,570			5,659,570
Share-based compensation		-			-			-			1,614,756			-			-			1,614,756
Deemed dividend on Series A convertible redeemable preferred shares		-			-			-			-			(3,300,000	)		-			(3,300,000	)
Conversion of series A convertible redeemable preferred shares into ordinary shares		29,714,103			2,971			-			58,899,769			-			-			58,902,740
Issuance of ordinary shares in the initial public offering (net of commission and issuance cost of $7,867,552)		46,000,000			4,600			-			79,532,448			-			-			79,537,048


Balance at December 31, 2010		175,714,103			17,571			-			140,305,556			116,881,004			6,276,868			263,480,999

Net income		-			-			-			-			33,323,952			-			33,323,952
Other comprehensive income		-			-			-			-			-			12,167,255			12,167,255
Share-based compensation		-			-			-			2,206,025			-			-			2,206,025


Balance at December 31, 2011		175,714,103		$	17,571		$	-		$	142,511,581		$	150,204,956		$	18,444,123		$	311,178,231

Net loss		-			-			-			-			(111,928,941	)		-			(111,928,941	)
Other comprehensive income		-			-			-			-			-			2,206,182			2,206,182
Share-based compensation		-			-			-			2,249,834			-			-			2,249,834
Repurchase		(2,836,670	)		(283	)		(494,928	)		(5,513	)		-			-			(500,724	)
Deconsolidation of Nanjing Daqo New Energy Co., Ltd		-			-			-			-			-			(1,099,299	)		(1,099,299	)


Balance at December 31, 2012		172,877,433		$	17,288		$	(494,928	)	$	144,755,902		$	38,276,015		$	19,551,006		$	202,105,283

FINANCIAL STATEMENT SCHEDULE I

DAQO NEW ENERGY CORP.

FINANCIAL INFORMATION OF PARENT COMPANY

STATEMENT OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2010, 2011 AND 2012

(In U.S. dollars)


	Year ended December 31,
	2010			2011			2012
OPERATING ACTIVITIES
Net income (loss)	$	68,571,257		$	33,323,952		$	(111,928,941	)
Share of results of subsidiaries		(72,459,911	)		(35,729,782	)		108,228,045
Share-based compensation		1,614,756			2,206,025			2,249,834
Adjustments to reconcile net income to net cash used in operating activities:
Prepaid expenses and other current assets		1,603,280			(142,001	)		(31,207	)
Changes in other current liabilities		(1,084,748	)		(916,531	)		214,231
Amount due from related party		-			-			(210,523	)

Net cash used in operating activities		(1,755,366	)		(1,258,337	)		(1,478,561	)

INVESTING ACTIVITIES
Capital contributed to subsidiaries		(33,199,062	)		(37,990,278	)		(4,811,175	)
Receivable from investee		-			162,981			-
Cash collected from Daqo Canada		-			-			4,390,250
Disposition of Nanjing Daqo		-			-			4,778,657

Cash used in investing activities		(33,199,062	)		(37,827,297	)		4,357,732
FINANCING ACTIVITIES
Repurchase of ordinary shares		-			-			(500,724	)
Repayment of other long-term borrowings		(7,130,000	)		-			-
Cash proceeds from issuance of ordinary share		80,982,000			-			-
Issuance cost of ordinary shares		(1,444,953	)		-			-

Cash provided by financing activities		72,407,047			-			(500,724	)

NET INCREASE IN CASH AND CASH EQUIVALENTS		37,452,619			(39,085,634	)		2,378,447
CASH AND CASH EQUIVALENTS AT BEGINNING OF PERIOD		4,924,402			42,377,021			3,291,387

CASH AND CASH EQUIVALENTS AT END OF PERIOD	$	42,377,021		$	3,291,387		$	5,669,834


Supplemental disclosure of cash flow information:
Disposition of Nanjing Daqo:
Total consideration	$	-		$	-		$	9,888,742
Less: amount due from Daqo Group		-			-			(5,110,085	)

Total cash consideration received	$	-		$	-		$	4,778,657

Supplemental schedule of non-cash financing activities:
Conversion of Series A convertible redeemable preferred shares into ordinary shares	$	58,902,740		$	-		$	-

FINANCIAL STATEMENT SCHEDULE I

DAQO NEW ENERGY CORP.

Notes to Schedule I

Schedule I has been provided pursuant to the requirements of Rule 12-04(a) and 5-04(c) of Regulation S-X, which require condensed financial information as to the financial position, changes in financial position and results of operations of a parent company as of the same dates and for the same periods for which audited consolidated financial statements have been presented when the restricted net assets of consolidated subsidiaries exceed 25 percent of consolidated net assets as of the end of the most recently completed fiscal year.

2.	The condensed financial information of Daqo New Energy Corp has been prepared using the same accounting policies as set out in the accompanying consolidated financial statements except that the equity method has been used to account for investments in its subsidiaries.

Certain information and footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted. The footnote disclosures contain supplemental information relating to the operations of the Company and, as such, these statements should be read in conjunction with the notes to the Consolidated Financial Statements of the Company.

As of December 31, 2012, there were no material contingencies, significant provisions of long-term obligations, mandatory dividend or redemption requirements of redeemable stocks or guarantees of the Company, except for those which have been separately disclosed in the Consolidated Financial Statement, if any.