GT Solar backlog and sales fall: looking for acquisitions to expand business

Sales in GT Solar’s second quarter FY2010 declined to US$104.2 million, compared to sales in the first quarter of US$140.2, highlighting the lumpiness in revenue generation of its furnace business as its order backlog stood at US$1.03 billion, down from US$1.115 billion in the previous quarter. New orders received in the quarter were US$20.1 million. De-booking was US$10.6million. Deferred revenue on equipment already shipped stood at US$472 million. Total new booking for the year stood at US$66.5 million.

“In the second quarter, we received new orders of $30.7 million including the first for our new SDR-400 reactor and for engineering services in our new silane business, as well as an order for our multi-crystalline furnaces from a new customer that has historically been a mono-crystalline wafer manufacturer,” noted Tom Gutierrez, GT Solar, President and Chief Executive Officer. “We are also seeing continued evidence that our reputation for quality, performance and industry-leading efficiencies is providing strong differentiation in the marketplace.”

During a conference call with financial analysts, GT Solar noted that the SDR-400 reactor would be shipped around mid-2010 to a new customer, which wasn’t identified. The company said that the SDR-400 reactor had 50% lower energy consumption over other systems and at a capacity of 400MT is its largest reactor.

New order intake is significantly below previous years due to the slowdown in many PV manufacturers’ ingot expansion plans and the current ramp of polysilicon plants rather than new plants coming on stream. However, the company noted that it was successful in renegotiating contracts with both Trina Solar and Russian-based polysilicon producer, Nitol that led to the shipment of previously backlogged orders.

GT Solar said that it was intentionally trying to reduce the lead times on shipments to reduce the backlog, especially in its PV segment.