Although the shutdown of its Sichuan Phase I polysilicon production line impacted profitability in 2013, tier one PV manufacturer, ReneSola reported a 142.5% year-on-year increase in PV module shipments, reaching 1,728.8MW with plans to reach 2.5GW in 2014.
ReneSola reported full-year net revenue of US$1,519.6 million, 56.8% higher that the previous year. Gross profit was US$103.3 million with a gross margin of 6.8%, compared to a gross loss of US$35.7 million with a gross margin of negative 3.7% in 2012.
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However, the company reported a full-year operating loss of US$222.1 million with an operating margin of negative 14.6%, mainly due to a non-cash impairment charge of US$202.8 million from the third quarter with the shutdown of its Sichuan Phase I polysilicon production line, deemed not to be competitive. Net loss attributable to holders of ordinary shares was US$259.5 million in 2013.
Fourth quarter results
ReneSola met shipment and revenue guidance in the fourth quarter of 2013, shipping 505.3MW of modules, up 9.2% from the previous quarter. Wafer shipments were down 7.9% to 784.1MW in the quarter as the company allocates an increasing amount of wafer production for in-house module production requirements.
The company reported a gross profit of US$47.4 million in the quarter with a gross margin of 10.8%, compared to gross profit of US$34.1 million with a gross margin of 8.1% in the third quarter of 2013.
Operating income was US$8.2 million with an operating margin of 1.9%, compared to an operating loss of US$180.3 million with an operating margin of negative 43.0% in Q3 2013.
The company noted that the sequential increase in gross profit was due to the focus on module shipment growth at the expense of external wafer sales as margins for modules were higher.
Largest global manufacturing footprint
As expected, ReneSola does not have plans to expand internal capacity in 2014, staying with its aggressive outsourcing strategy across multiple regions that totalled 1GW at the end of 2013.
The company has OEM PV module manufacturing agreements in Poland, South Africa, India, Malaysia, South Korea, Turkey, and most recently Japan under a new JV agreement. As a result, ReneSola has the largest global manufacturing footprint of any PV manufacturer.
“We saw rapid growth in our international business development last year,” commented Xianshou Li, ReneSola's chief executive officer. “We now have 15 overseas sales offices, with our most recent openings in established markets like France, and emerging markets like Panama, Turkey and Thailand. We are also in the process of setting up new sales offices in Southeast Asia, Latin America, the UAE, Africa, Russia, and Canada, and we now have 27 warehouses around the globe. With our local teams and distribution centres serving the majority of overseas markets, we are able to provide tailor-made local support and solutions, as well as instant product delivery. Moreover, we are able to extend the reach of our brand image and enhance our reputation for quality, which is key to our goal of becoming an integrated service and solution provider.”
Guidance
ReneSola said that it expected PV module shipments in the first quarter of 2014 to be inline with shipment levels from the fourth quarter of 2013, noting that shipments to Japan would increase materially. The company guided shipments in the range of 500MW to 520MW and gross margin to be in the range of 9% to 11%.
PV module shipments for the full-year 2014 are expected to be in the range of 2.3GW to 2.5GW, suggesting further OEM outsourcing in the year.
