GCL-Poly posts loss after 60% price declines for polysilicon and wafers

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GCL-Poly said that both polysilicon and wafer shipments increased in the first-half of 2012, but price declines of over 60% from the same period a year ago led to losses of HK$330 million (US$42.5 million approx), as compared with a net profit of HK$3,550 million (US$458 million approx) for the same period of 2011.

GCL-Poly reported revenue of HK$11,782 million (US$1.58 billion), a decrease of 22.4% from HK$15,174 million for the prior year period. The Group’s gross profit margin was 14.3%, compared with 38.6% in the prior year period. Gross profit margin for the solar business decreased from 44.2% in the first-half of 2011 to 15.5% for the first-half of 2012. Gross profit was approximately HK$1.70 billion, a 71% decrease, compared with the same period in 2011.

The company reported polysilicon production continued to ramp, increasing 109.8% to 25,233MT, compared to 12,026MT for the prior year period. Wafer production also increased significantly in the first-half of 2012, reaching 3,042MW, up 46.5% from 2,076MW for the six months of 2011.

Polysilicon ASPs declined around 62%, while production costs only declined 14.5%, from US$22.1 per kilogram for the six months ended 30 June 2011 to approximately US$18.9 per kilogram for the same period of 2012.

External sales of polysilicon also increased substantially, going from only HK$728,658 in the first-half of 2011, to HK$1,624,061 in the first-half of 2012.

However, wafer sales declined substantially from HK$11,416,133 last year to HK$6,676,640 in the first 6-months of 2012.

Wafer production costs were approximately US$0.26/W, a decrease of 48.1%, compared with approximately US$0.51/W in the prior year period. Wafer processing cost was approximately US$0.13/W.

The company sold 9,012MT of polysilicon and 3.2GW of wafer respectively during the 6-month period, representing an increase of 498% and 50%, respectively as compared with the same period last year.

PV project pipeline

GCL-Poly said that it had achieved modest progress with its efforts to move downstream and develop PV power plants. The Group’s total solar farm projects in operation in the United States reached 16MW in the first-half of the year. Total revenue from sales of electricity generated by PV plants in the US was approximately US$4.8 million.

The company noted that it had over 469MW projects within its pipeline, of which approximately 95MW was currently under construction, and approximately 374MW of projects located in the US and Puerto Rico would commence construction by end of 2012.


Management noted that ASPs had been stabilizing since the second quarter of 2012 and that this was expected to continue and in the second half of this year. However, GCL-Poly said that it expected a new wave of consolidation to occur. 

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