Q-Cells reports wider than guided Q3 loss; lowers full-year guidance

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Q-Cells expects revenue to bounce back in the fourth quarter after posting financial results for the third quarter that are nearly half of those reported in the prior year period. Q-Cells reported revenue for the quarter of €228.8 million and a negative EBIT of €47.3 million. As its project business gains momentum, the share of solar cells sales fell from 69.2% in the prior year period to 46.5% in the previous year. Overhead costs are to be reduced by approximately 25% in 2012 with the loss of 250 jobs. Revenue guidance for the full year was €1 billion with a negative three-digit million operating margin.

Q-Cells said it had increased cash and cash equivalents to €230.3 million by the end of Q3. The company expects cash and cash equivalents to up to €300 million by the end of 2011. This is expected to include restricted cash in the range of €60-€70 million.

Revenue in the third quarter amounted to €228.8 million, down from €316 million in Q2 and down from €401.6 million in Q3 2010.

Q-Cells also announced the resignation of its CFO, Marion Helmes, on the release of its third-quarter results.

Q-Cells' latest restructuring efforts are designed to reduce overhead costs by approximately 25%, though when restructuring was initially announced the company put restructuring targets at between 25%-30%. Although the company previously said it would try and avoid forced redundancies, Q-Cells said that a reduction in headcount of 250 before the year's end would be achieved as part of the streamlining.

Production of cells and modules was up slightly at 156MWp, compared to 147MWp in Q2. However, this figure represents only of the production figures achieved in Q3 2010, when production – primarily of solar cells – reached 305MWp.

The relative bright spot was module and project business in the quarter. In the first nine months of 2011, the share of solar cells sales in total sales fell from 69.2% compared to 46.5% in the previous year.

Sales in relation to PV projects were said to be a key part of the increased revenue expected for the fourth quarter. 

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