Canadian Solar to miss second quarter shipment guidance

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  Canadian Solar had previously guided module shipments to be in the range of 430MW to 450MW in the second quarter. The revised guidance puts shipments at between 410MW to 420MW.

Although solar module shipments are still expected to be higher in the second quarter, compared with the first quarter of 2012, Canadian Solar has followed Trina Solar in revising solar module shipment guidance down. The company cited weaker than expected demand from the US for the shortfall.

Canadian Solar had previously guided module shipments to be in the range of 430MW to 450MW in the second quarter. The revised guidance puts shipments at between 410MW to 420MW.

"Shipments remained strong in the second quarter of 2012, despite weaker than anticipated demand in the US,” commented Dr. Shawn Qu, chairman and chief executive officer of Canadian Solar. “As a Tier 1 company, focused on non-commodity opportunities, including our rapidly expanding global project business, we are succeeding in an otherwise challenging market.  We are driving sales growth in higher value segments, reducing our manufacturing costs, maintaining strict supply chain oversight and working to further improve our operating cash flow."

A net foreign exchange loss was also expected for the quarter, which was said to be approximately US$8 million due to the decrease in the value of the Euro compared to the US dollar during the quarter.

Canadian Solar also said that it expected gross margin to be in the range of 12.0% to 12.5% due to the positive impact of one-time items, though it didn’t specify the factors involved. 

The US market is still expected to increase in 2012, according to a recent forecast from GTM Research. Both the residential and utility-scale markets will expand, supporting approximately 4GW of PV installations this year.

However, US PV installations in the fourth quarter of 2011 nearly doubled from the previous quarter to reach around 780MW, which was attributed to a rush to beat the end of tax incentives. Module shipments from Chinese and other Tier 1 suppliers into the US market had remained strong into the first quarter, though installations declined to around 500MW.

Trina Solar claimed a day before Canadian Solar’s revised shipments that the US market had weakened after countervailing and anti-dumping duties were imposed. However, inventory build within the supply chain could be a contributing factor.