GT Solar at full steam ahead: backlog stands at US$2.3 billion as sales up 71%

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Despite current weakness in solar related equipment spending, due to weak demand for PV modules in the first half of the year and a longer than expected inventory build, GT Solar posted first quarter financial year revenue of US$231.1 million, compared to US$271.6 million last quarter and up 71% from the US$135.2 million of revenue in the first quarter of fiscal 2011. Record order backlog stood at US$2.3 billion.

The results and backlog would seem to be in direct contrast to many expected results from a string of leading equipment and materials suppliers to the PV industry, which are due over the next month or so. 

Commenting on GT Solar’s growth, rather than the PV equipment industry’s general trend for weakening sales, Solarbuzz analyst, Finlay Colville told PV-Tech that GT Solar was setting itself apart from the crowd.

“GT Solar is uniquely positioned as an equipment supplier to the PV industry today, and this distinction is currently allowing them to sustain Y/Y revenue growth (and retain fiscal year 2012 guidance) at a time when nearly every other PV equipment supplier is being impacted adversely by the cyclic downturn in spending. While other equipment suppliers are anticipated to see strong Q/Q revenue declines during CY Q3’11 and Q4’11, GT Solar is expected to return CY 2H’11 PV-industry-specific revenues approximately flat with 1H’11,” commented Colville.

“There is no other PV equipment supplier today that commands strong revenues and market share within both poly and non-poly segments of the PV industry. Other PV equipment suppliers (mostly serving the ingot-to-module segment only) due to report in the next few weeks are expected to reveal declining order intakes and backlogs. These equipment suppliers are currently relying on high-efficiency upgrades through 2012 to compensate for declines in new tools required. GT Solar is in the fortunate position however that upgrade tooling offers incremental upside,” added Colville.

GT Solar reported an order backlog of US$2.3 billion, as of July 2, 2011, which is the highest level of quarter-ending backlog ever achieved by the company.

The order backlog for its polysilicon segment stood at US$978.2 million, which has recently been boosted by new orders from new customers. The backlog in its PV segment came in at US$369.6 million.

Although unrelated to the PV sector, GT Solar reported a backlog for sapphire furnaces and systems of a significant US$952.5 million, its newest market presence.

“There are several reasons that GT Solar should be treated somewhat different to other PV equipment suppliers. The most obvious (and often overlooked) factor is that GT Solar does not participate in the thin-film PV segment – this removes the threat of lumpy bookings and customer funding that is not directly linked to industry supply/demand dynamics. But the key factor right now is their (strong market-share) participation in tool supply to both the poly and upstream (ingot/wafer) segments of the PV industry, and – more crucially – the fact that each of poly and ingot/wafer equipment spending operates with different cyclic behaviour. Currently, ingot/wafering is approaching the peak of its spending cycle before dropping off significantly from CY Q1’12. GT Solar’s poly revenues are forecast to see strong growth – almost at exactly the same time as the ingot revenues decline.”

Tom Gutierrez, president and chief executive officer of GT Solar also highlighted that sales, due to the record backlog status were already looking healthy a year from now, despite market uncertainty.

“Bolstered by our $2.3 billion backlog position, we are confident in our ability to achieve our FY12 guidance and also believe that we have built a solid foundation for continued growth in FY13 and beyond,” commented Gutierrez.

GT Solar reiterated its fiscal 2012 guidance for revenue in the range of US$1.0-$1.1 billion, while raising its gross margin guidance to a range of 43-45%, up from the prior guidance of 42-44%.

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