Strong demand from Sharp boosts Solargiga’s earnings

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Integrated PV manufacturer, Solargiga Energy Holdings reported an 85.9% increase in first-half 2014 revenue as it expanded PV module production to meet increased demand from its main customer, Sharp. 

Solargiga reported revenue for the first six months of RMB1,522.285 million (US$247.7 million), compared to US$133.3 million in prior year period. 

Gross profit for the period under review increased by 660.7% to RMB141.42 million (US$23 million). The Net loss decreased by 88.1% to RMB16.295 million (US$2.65 million). 

Hsu You Yuan, Executive Director and CEO of Solargiga, said: “Rapid expansion of our photovoltaic module business to strengthen market competitiveness of our downstream business is an important measure to consolidate the Group’s vertical integration strategy. The Group‟s photovoltaic module business in 2H13 recorded a remarkable increase, prompting significant improvement in the Group’s 2H13 results which represented a successful turnaround. To follow the remarkable development trend of the Group in 2H13, Solargiga continues to consolidate and improve its leading position in the photovoltaic module business by increasing its stake in Jinmao Photovoltaic, which is propitious to the development of the Group‟s entire business in 2014.”

Jinmao Photovoltaic

Solargiga said it had increased its ownership of Jinzhou Jinmao Photovoltaic Technology Company to 96% at a cost of RMB100 million (US$16.2 million). Jinmao Photovoltaic is the subcontracting module subsidiary supplying modules to Sharp. 

The company also expanded module capacity in Jinzhou to 400MW at the beginning of the year to meet demand from Sharp, however orders from the Japanese currently outstrip supply. 

The production capacity of Jinmao Photovoltaic was approximately 150MW at the beginning of 2013 and was subsequently expanded to 175MW in the third quarter of 2013. Capacity in 2013 reached approximately 230MW, which was said to have generated a profit after tax of RMB35,728,000 (US$5.8 million) at the end of the year. 

Solargiga reiterated that it had quickly become the largest solar product supplier to Sharp in China and expected demand from Sharp to be more than 30% in the Japanese fiscal year 2014, compared with FY2013.

In the first six months of 2014, external module shipments were 232.1MW, compared to only 79.9MW for the same period of last year, or a 190.5% increase. 

The module segment contributed turnover of RMB1,018.876 million (US$165.8 million), accounting for 66.9% of total turnover and representing a growth of 184.1%, compared with the prior year period.

Shipments

Solargiga’s external shipments of solar silicon ingots was approximately 26.7MW, representing a 40.9% decrease as compared to 45.2MW in the same period of last year. The decrease was said to be due to the increases in-house requirements of the group. 

The external shipment volume of N-type silicon ingots was approximately 26.7MW in the first six months, representing approximately 99.9% of total external shipment volume of silicon ingots, primarily to customers in Japan, according to the company.

Solar wafer shipments in the period were said of reached 209.7MW, 41.2% higher than in the same period a year ago. Annual production was said to have reached 900MW in the period. 

Solargiga’s external solar cell shipments were approximately 61.9MW, 35.4% higher than last year, contributing around RMB167.965 million (US$27.3 million) in turnover and accounting for 11% of overall turnover in the period. 

“We will continue to utilize advantages of vertical integration and strengthen market competitiveness of each business of the Group to rapidly enhance our overall market,” added  Hsu. “Besides our existing Japanese customers, the Group has attained remarkable achievements in the PRC and Taiwan markets for upstream and mid-stream products including solar ingots, wafers, cells and modules. Regarding our downstream photovoltaic business including PV power plant construction business (EPC) and a variety of operational solar power plant systems maintenance, the Group actively expands emerging target markets such as Africa, Southeast Asia, Turkey, the Balkans, etc. while maintaining development of existing PRC and German markets.”

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