Trina Solar releases estimated fourth quarter and full year 2008 financial results

Trina Solar announced its estimated financial results for both the fourth quarter and the full year 2008. For the fourth quarter, the company expects total net revenues to surpass its previous guidance range of US$190-210 million, with a positive net operating cash flow at about US$60 million. They also expect their short-term debt to be reduced by about US$41-249 million and a non-cash inventory provision between US$16 and 18 million. As for the full year 2008, the company estimates that the total net revenues will meet its previous guidance range of $800-850 million, and that total module shipments will meet its previous guidance range of 200-206MW.

“Against a very challenging operating environment, where preservation of cash and balance sheet fundamentals were our priorities, the notable reduction in both our silicon and non-silicon manufacturing costs resulted in our highest ever quarterly operating cash flow,” stated Jifan Gao, Chairman and CEO of Trina Solar. “This allowed us to significantly reduce our short-term debt to further improve our capital structure and maintain our liquidity for 2009.”

Trina Solar also expects a non-cash inventory provision of between US$16 and 18 million, primarily as a result of the revaluation of its silicon inventory as well as substantial market price declines in the fourth quarter of 2008. The provision is predicted to have a negative gross margin impact of 7-8%, with which the company expects its fourth quarter gross margin to be between 9 and 10%, as compared to its earlier guidance of 13-15%. Trina Solar expects its operating and net margins to be similarly affected.

The company’s estimated results are subject to their financial closing procedures, thus the actual results may differ from the current estimates.