GT Advanced Technologies issued revenue results ahead of guidance for its second quarter (FY) results. The company posted US$217.7 million in revenue, compared to US$231.1 million in the first quarter of fiscal 2012. Revenue by business segment was led by photovoltaic with revenue of US$111.2 million, due to large number project completions in the quarter. However, GTAT noted that it cancelled several customer orders and experienced shipment push-outs, while citing weaker than expected demand that would impact annual revenue guidance and backlog.
“On the PV side of the business, the industry downturn is more severe than most expected and as a result we now expect to see additional push outs of PV deliveries into FY13,” noted Tom Gutierrez, president and chief executive officer. “Although we believe our sapphire and polysilicon equipment revenues will strengthen this fiscal year and that we will maintain our leading PV market share, we are adjusting our guidance range to reflect conditions in the PV industry.”
However, GTAT isn’t dependent on PV alone, unlike others in the field, noted Finlay Colville, Senior Analyst with Solarbuzz to PV-Tech.
“GTAT remains well positioned to weather the near-term collapse of the c-Si ingot-to-module capacity freeze. Aside from having an emerging revenue stream within an adjacent market segment [Sapphire], GTAT benefits from a tier 1 customer-base in solar that includes both polysilicon and ingot manufacturers. This is a key feature today, as equipment supply to polysilicon operates on significantly different investment cycles [book-to-bill trends] compared to ingot/wafer and cell/module expansions,” Colville said.
GTAT revised annual revenue down 5% (US$50 million), compared to previous guidance. Fiscal 2012 guidance for revenue is now in the range of US$950 million to US$1.05 billion. The company maintained its gross margin guidance range of 43% to 45%.
Gross profit for the first six months of fiscal 2012 was US$208.5 million or 46.5% of revenue, compared to US$139.0 million or 38.2% of revenue for the first six months of fiscal 2011.
‘MonoCast’ is coming
Gutierrez noted in the call that the PV segment sales wouldn’t recover until the second-half of the year, driven by new innovations in cell efficiencies, which will be driven by a significant move led by GTAT to ‘MonoCast’ (quasi-mono) technology.
He highlighted that GTAT’s monocast technology was producing high-yields, unlike others that have been developing quasi-mono casting techniques. Gutierrez said that GTAT would be offering field upgrades to its installed-base of DSS furnaces to help move the PV industry to the monocast technology.
‘HiCz’ is coming
Having recently acquired Confluence Solar, a developer of ‘HiCz’, a continuously-fed Czochralski (CCz) growth technology for US$60 million, Gutierrez noted that the company had received strong interest for this lower-cost Czochralski method, especially from well-known European-based PV manufacturers. Gutierrez said that he expected the order ramp to start mid-year, 2012.
Critical polysilicon costs v prices
GTAT reported polysilicon segment revenue of US$98.0 million in the quarter, however the as the price for polysilicon continues to fall and is in the low US$30/kg range today, Gutierrez said that the company was expecting big orders to be placed for its polysilicon equipment and services offerings over the next 6-months.
This was being fuelled by the need to reduce production costs after many polysilcion producers were starting to sell product at or near cash cost.
With the drive to higher purity polysilicon, needed for high-efficiency solar cells, customers such as OCI were migrating to GTAT’s Gen 5 SDR technology and that this trend would continue. GTAT had over US$564 million of polysilicon orders booked so far in FY2012. New orders for the second quarter were US$65.4 million and included US$51.0 million of polysilicon orders
Backlog
GTAT reported its order backlog had decreased to US$2.1 billion at the end of the quarter, down from US$2.3 billion. However, with a strong revenue quarter expected in FYQ4 due to significant shipments and reconciliation of polysilicon projects the backlog was in overall good health.
“The sharp decline in DSS furnace new order intake during CY Q3’11 was largely in line with expectations, consistent with the lack of new capacity being committed to for CY 2012. While this downturn alone will have a profound impact on the solar specific backlog of competitors that have been over-dependent on midstream PV investments in the past, GTAT’s solar backlog remains strong owing to its polysilicon supply. During 2012, almost all other PV equipment suppliers will start the year with heavily depleted backlogs awaiting an upturn in midstream order intake,” added Colville.
