GCL-Poly warns of massive net loss for 2020

Facebook
Twitter
LinkedIn
Reddit
Email
GCL-Poly Energy Holdings expects to report a net loss for 2020 of not less than RMB 5.8 billion (US$891 million). Image: GCL-Poly

Major polysilicon and wafer producer GCL-Poly Energy Holdings expects to report a net loss for 2020 not less than RMB5.8 billion (US$891 million).

The net loss warning is the largest GCL-Poly has announced, dwarfing losses made in 2013 and 2018.

GCL-Poly Group had reported a net loss in the first half of 2020 of RMB1,924 million (US$281.8 million), with its key Solar Material business unit (polysilicon and wafers) making losses of RMB2,023 million (US$296.2 million).

These first half year losses were attributed to a 51.1% decline in actual silicon rod production as the company disposed of a 31.5% equity interest in Xinjiang GCL polysilicon plant with a nameplate capacity of around 50,000MT in 2019. The Xinjiang plant also suffered a major incident while under annual maintenance during this period.

The company was also impacted by COVID-19 with weak demand in the first half of the year, resulting in rapidly falling polysilicon average selling prices (ASPs), which fell to US$7.56/kg in that reporting period, down from US$9.01/kg in the prior year period. Wafer ASPs followed a similar downward path.

Although GCL-Poly had noted the start of a rebound in polysilicon ASPs at the end of the first half 2020 reporting period, the company was bullish on the polysilicon business unit returning to profitability in the second half of the year.

Based on GCL-Poly’s profit warning, second half year net losses increased to not less than US$596 million, however the company did not provide insight into a profitable position for the Solar Material business unit as a whole.

The net loss warning is the largest GCL-Poly has announced, dwarfing losses made in 2013 and 2018.

The sale of the Xinjiang GCL polysilicon plant in 2019 boosted GCL-Poly’s balance sheet by RMB4.4 billion (USUS$676 million), resulting in a very small net profit for the year of around RMB110 million (US$17 million).

GCL-Poly said that its full-year 2020 expected net losses were partially attributable to the sale of Xinjiang GCL in 2019, due to the absence of the Xinjiang GCL disposal gain in its 2020 financial year.

The company also noted that the expected net losses were partially attributable to impairment provision on assets, while the expected increase in the net loss was partially offset by the exchange gain caused by the depreciation of the USD against the RMB for USD denominated indebtedness.

Read Next

August 16, 2022
Heterojunction cell and module producer Meyer Burger has secured European-made silicon wafers through a new supply agreement with Norwegian Crystals.
August 10, 2022
Canadian Solar plans to build an integrated PV manufacturing plant in Western China, with a capacity of 200,000MT of high-purity polysilicon, 10GW of both cells and modules and multi-GW productions of raw and auxiliary materials.
PV Tech Premium
August 8, 2022
The price of polysilicon in China rose across the board last week, despite signals that it may have stabilised, constituting the 25th round of price increases this year alone.
August 3, 2022
Global investment in renewable energy reached a record half-year figure of US$226 billion in H1 2022, driven by soaring demand for clean energy technologies amid the ongoing energy and climate crisis, according to a BloombergNEF (BNEF) report.
PV Tech Premium
August 1, 2022
China’s polysilicon price finally stabilised this week, according to the Silicon Industry Branch of the China Nonferrous Metals Industry Association, following several long-term contracts being signed, helping to reduce market volatility in the short-term.
July 27, 2022
Solar wafer and cell prices have risen once again this week, with the price of polysilicon continuing to climb unabated.

Subscribe to Newsletter

Upcoming Events

Upcoming Webinars
September 7, 2022
15:30 AEST (UTC +10)
Solar Media Events
September 14, 2022
London
Solar Media Events
October 4, 2022
New York, USA
Solar Media Events
October 11, 2022
Virtual event