LDK Solar pares outlook, expects fourth-quarter loss



The latest solar manufacturer to pare its financial outlook is Chinese multicrystalline wafer and polysilicon producer, LDK Solar. The company updated its numbers, estimating that revenues for the fourth quarter will be in the range of $415-$425 million, a slight drop from its previous guidance of $425-$435 million provided in early January and a significant decrease from the $555-$565 million forecast given in mid-November, while the outlook for wafer shipments continues to hover between 245 and 255 MW.

But an inventory-related writedown of $210-$220 million will help push LDK into the red, resulting in a negative gross margin and a resultant loss for the quarter of $135-$145 million.  LDK expects full-year 2008 revenues to be in the $1.63-$1.64 billion range, with wafer shipments between 810 and 820 MW, and to stay in the black for the fiscal year with a net profit of $145-$155 million.

In its updates of capacity expansion and capital spending plans for 2009, LDK Solar said that it will delay its wafer capacity expansion by one quarter and now expects to reach 2.0-GW capacity at the end of the year, compared to its original plan of 2.3 GW.

The company also said that it will delay installation of the third 5000-MT train at its 15,000-MT polysilicon plant until 2010. The first two 5000-MT trains should reach mechanical completion at the end of the second quarter and during the second half of the year, respectively.
At its smaller poly plant, though, LDK expects to increase annualized poly production capacity to 2000 MT from 1000 MT by the end of 2009, in order to improve its production cost structure.  Full production capacity of the initial 1000 MT should take place by mid-2009, the company believes.   

With the changes in plans at the two poly plants, LDK now expects the combined annual production capacity of both factories to reach 12,000 MT by the end of this year, compared to the originally planned 16,000 MT.

Although LDK did not provide any further guidance for 2009 revenues, wafer shipments, or gross margins, the company said it will provide additional details, including updated guidance for 2009, when it reports fourth-quarter and full-year 2008 results on March 11.

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