Although shipments increased 5.8% in Q3 2012, compared with the previous quarter, China-based PV manufacturer, ReneSola had declining ASP’s that resulted in revenue down 6.4% q-on-q.
The company reported Q3 2012 revenue of US$218.2 million, down from US$233.0 million in Q2 2012. Declining ASP’s and an inventory write down of US$31.6 million to reflect the decline in the price of solar wafers and polysilicon resulted in a net loss of US$78.6 million, compared to a net loss of US$34.8 million in the prior quarter.
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Xianshou Li, ReneSola's chief executive officer said, “While we delivered record shipments in the third quarter, declining selling prices and the substantial supply-demand imbalance continued to have a large impact on our margins. Nevertheless, we continued to drive down costs and improve efficiency through strong management and a dedicated R&D team. Over the year, we've leveraged our core competitive strength in wafer manufacturing and technology to develop highly efficient solar modules that have attracted customers in a number of markets, most notably Europe and Australia, and also the United States and China. Despite the difficult market conditions impacting the industry, we are confident in our ability to lower costs and develop superior technology that will grow our solar module business in both the near and long term.”
Shipments
The increase in solar product shipments was due to an increase in demand for high-efficiency ‘Virtus’ wafers from customers in Asia-Pacific, according to the company. Wafer shipments increased to 387.5MW in Q3, compared to 344MW in Q2 2012.
ReneSola said that 101.7MW of total module shipments in Q3 were Virtus modules, slightly down from the previous.
The company reported module ASPs of US$0.65/W in Q3, slightly lower compared to Q2 2012. Gross margin for its module business was approximately 1.0%.
Polysilicon production
ReneSola noted that it had halted polysilicon production at the beginning of November to complete and integrate Phase II of its expansion plans that will see capacity increase to 10,000MT per annum by the end of Q1 2013. Trial production for Phase II was expected to start in January 2013, according to the company.
Previously hailed by the financial community as a low-cost provider, RenSola noted that its internal polysilicon production costs decreased to approximately US$23.57kg at the end of Q3 2012, down from around US$25.80/kg at the end of Q2 2012.
The company noted that it expected costs to fall below US$18/kg by the end of Q1 2013, due to the Phase II ramp.
Financial guidance
ReneSola said that it expected total solar wafer and module shipments to be in the range of 635MW – 675MW in Q4, while reiterating recently revised full-year shipments to be close to 2.2GW in 2012.
However, the expected increase in shipments in Q4, are expected to come from an increase module shipments compared with Q3. ReneSola guided module shipments to be in the range of 250MW – 270MW, compared to module shipments of 145.3MW in Q3.
Revenues are expected to be in the range of US$240 million – US$260 million and gross margin is expected to be positive in Q4 2012.