Zhongli Group guides loss for Q1 amid fundraise for 1GW heterojunction plant

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Jiangsu Zhongli Group has approved a plan to raise around US$222 million in a non-public offering to build an 1GW integrated heterojunction (HJT) plant. Image: Talesun

Technology and science group Jiangsu Zhongli Group, which includes integrated PV manufacturer Talesun, has guided a net loss for the first quarter of 2020 due to COVID-19's impact on operations, while approving a plan to raise around US$222 million in a non-public offering to build an 1GW integrated heterojunction (HJT) plant. 

Zhongli Group said that it expected a net loss in the range of RMB 165 million to RMB 195 million (US$23.3 million to US$27.5 million) in the first quarter of 2020. The company had reported a net loss of around US$12 million in the prior year period, while guiding a small net profit for 2019 in the range of RMB 40 million to RMB 60 million (US$8.6 million at the high-end of the guidance).

The company noted that it had only been able to restart production across its business divisions in the last four weeks. This was compounded by supply chain issues, notably for various raw materials, and higher production costs as a result. Sales operations were also hampered due to the spread of the pandemic overseas.

Zhongli also noted that it was postponing the release of its 2019 financial results till the end of April, a slight delay, again due to the impact of the COVID-19 pandemic. 

Manufacturing update

Over Q1 2020, Zhongli Group also announced several PV manufacturing capacity expansion plans by its PV manufacturing subsidiary Talesun. 

Talesun has started construction of a new 5GW module assembly base in Zibo, Shandong province, China that is expected to accommodate larger wafer sizes and be highly automated. The new manufacturing base is expected to start operations by the end of 2020, increasing module assembly capacity to over 10GW. 

The PV manufacturer is also upgrading 1GW of existing solar cell and module capacity to n-type TOPCon (Tunnel Oxide Passivated Contact) high-efficiency cells over an 18-month period. The upgrade, coming at a cost of around RMB 375 million (US$53 million), is part of the non-public offering authorised by the group last week. 

The third project, which was initially announced in January 2020, is for a new 1GW integrated (cell/module assembly) heterojunction plant at Talesun’s main manufacturing operations in Changshu City, Jiangsu Province.

The project is expected to cost around US$222 million, amid predictions it will take two years to build and start ramping four dedicated HJT production lines. It is the main part of the recently announced capital raise.

PV Tech has set up a dedicated tracker to map out how the COVID-19 pandemic is disrupting solar supply chains worldwide. You can read the latest updates here.

If you have a COVID-19 statement to share or a story on how the pandemic is disrupting a solar business anywhere in the world, do get in touch at jrojo@solarmedia.co.uk or lstoker@solarmedia.co.uk.

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