Canadian Solar ships 6.1GW in opening quarter, up 66% year over year

Candian Solar’s IPO of its subsidiary, CSI Solar, is on track to be completed in Q2 2023. Image: Canadian Solar.

Canadian Solar has shipped 6.1GW of solar modules in the first quarter of 2023, a 66% increase over the same period a year earlier.

The top markets for the manufacturing division, CSI Solar, were China, Brazil, the US, Spain and Germany. Of the total shipments during Q1 2023, 90MW were shipped to the company’s own utility-scale solar projects. Canadian Solar recently consolidated its global solar development and services business under the Recurrent Energy arm, which was previously limited to North America.

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The company has a current annual capacity of 20.4GW, 21GW, 21GW and 36.2GW of ingots, wafers, cells and modules, respectively and is targeting to more than double each section by March 2024. The company expects to reach an annual capacity of 50.4GW, 50GW, 60GW and 75GW for ingots, wafers, cells and modules respectively.

“With the imminent IPO of our CSI Solar subsidiary, we will have a new platform to raise investment capital and further strengthen our leading position in solar and battery storage manufacturing,” said Shawn Qu, chairman and CEO at Canadian Solar. The IPO of CSI Solar is on track to be completed in Q2 2023.

Net revenues in Q1 2023 were also up from US$1.2 billion in Q1 2022 to US$1.7 billion in Q1 2023, a 36% YOY increase due to a “significant” increase in solar module shipments offset partially by lower module average selling price (ASP) and lower revenues from utility-scale battery storage solutions and project sales. Gross profits were also up by 76% YOY in Q1 2023 with US$318 million registered.

“We expect significant revenue and profit growth in the second quarter driven by both higher volume in solar module shipments and project sales. In the CSI Solar segment, volume growth is picking up while costs continue to come down, albeit partially offset by gradual ASP declines. On the Recurrent Energy side, we expect the closing of a major project sale during the quarter to have a significantly positive impact on profit,” said Qu.

Solar pipeline of 24.6GW globally

The development segment of the company, Recurrent Energy, had a solar project development pipeline of 24.6GW at the end of March, of which 1.7GW under construction, 5.2GW of backlog and 17.7GW in advanced and early-stages.

The majority of the projects currently under construction are located in Latin America with 1.4GW, followed by China with 250MW, while overall Europe, the Middle East and Africa (EMEA) is the region with the biggest pipeline with nearly 7.8GW of projects in different phases, followed by North America with 7GW and Latin America with 5GW.

Earlier this week, Recurrent Energy signed a virtual power purchase agreement with several offtakers for its 100MW solar plant in Liberty County, Texas.

Furthermore, the battery storage pipeline sits at 47.4GWh, of which 0.3GWh under construction, while more than half of the total is located between North America (19.1GWh) and EMEA (14.2GWh).

Shawn Qu, chairman and CEO at Canadian Solar, said: “We started off the year strong with 36% yoy revenue growth and 750% increase in diluted earnings per share. We continue to leverage our premium brand to capture increased solar and battery storage opportunities, while laying the groundwork for future success with strategic capacity expansion. We remain focused on profitable growth and continue to optimise our cost structure through vertical integration. With the imminent IPO of our CSI Solar subsidiary, we will have a new platform to raise investment capital and further strengthen our leading position in solar and battery storage manufacturing.”

In its forward guidance, Canadian Solar expects revenue in Q2 2023 to be between US$2.4-2.6 billion, while CSI Solar’s shipments are expected to be in the range of 8.1GW-8.4GW, up from the 5GW of solar modules shipped in Q2 2022. For the full year the company has reiterated its previous outlook for CSI Solar’s total module shipments to be between 30-35GW of solar modules in 2023, whereas storage shipments are expected to in the range of 1.8-2GWh.

Guidance for the full year of 2023 revenue however has been increased in the lower end from US$8.5-9.5 billion to US$9-9.5 billion.

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