Yingli Green narrows losses helped by stable ASPs and cost reductions

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Yingli Green Energy has reported third quarter 2013 revenue of US$596.3 million and net loss of US$38.5 million as PV module shipments increased 5.1%.

Acknowledging the shipment disruption caused by the EU anti-dumping investigation that was settled in the quarter, Yingli Green noted Germany accounted for 16% of shipments, down from 28% in the second quarter of 2013.

However, Germany in the fourth quarter was forecast to account for only 3% of shipments, and 19% of shipments for the full year.

“While European markets continued to make adjustments under the new Undertaking Agreement with higher average selling prices combined with softer demand in the third quarter of 2013, shipments into China and the Americas accounted for more than half of our total shipments for the first time in our history,” said Liansheng Miao, chairman and chief executive of Yingli Green Energy.

Yingli Green noted that shipments in China accounted for 38% of total shipments, up from 28% in the second quarter of 2013.

China and US top shipments

Demand in China was supported by its downstream business, which increased by more than 300% from the second quarter, highlighting the expected rapid demand growth before the end of the year to complete PV power plant project before FiT changes.

Shipments to the US and Japan also increased in the third quarter. The company reported that the US accounted for 27% of shipments, up from 20% in the prior quarter.

The company has been building strong momentum in the US market over the last 18 months, culminating in the quarter being the highest quarter by volume, 39% above last quarter’s record level.

The company noted that US sales were diversified across a wide set of customers, with 60% of those customers purchasing at least 1MW each and modules were used in over 30,000 sites in the quarter across the Americas and the Caribbean.

However, residential and distributor segment sales in the US accounted for around 70% of sales in the past two quarters.

Shipments to Japan accounted were said to have increased by 35%, over the previous quarter.

Yingli Green also noted that it had expanded its customer base in Latin America by over 15% to approximately 75 customers, while third quarter sales in the region were over 600% higher than the year-ago period.

Losses narrow

Having posted around US$500 million in losses in 2011 and 2012, Yingli Green reported a third quarter net loss of US$38.5 million.

Operating loss was US$11.5 million, with an operating margin of negative 1.9% in the third quarter of 2013, dwon from a negative 3.8% in the second quarter of 2013 and negative 41.6% in the third quarter of 2012.

Full-year guidance reiterated

The company said that continued strong demand in the fourth quarter would enable it to meet prior full-year guidance of shipments being between 3.2GW to 3.3GW, representing an increase of 39.4% to 43.7% compared to fiscal year 2012.


Project pipeline

During the conference call to discuss third quarter results, management noted that the company was developing a China-based PV project pipeline of between 400MW to 500MW, with a large percentage completed, however the key aspect in project development efforts would be focused on enabling IRRs of between 9-11% for investors/owners.

Capacity utilization

Management also highlighted that it expected to retain high utilisation rates throughout 2014, while increasing fully integrated (wafer/cell/module) internal capacity to 3GW. The company recently noted at its annual analyst day that it had 2.45GW of vertically integrated nameplate manufacturing capacity.

However, management noted that there would be no meaningful increase in capital spending. The company said it had identified further third-party module manufacturing opportunities that would provide, based on demand the ability to meet over 4GW of shipments in 2014. 

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