Investors Unimpressed With First Solar’s 11.3 GW Worth Of Bookings


Clean Power

Published on October 30th, 2018 |
by Joshua S Hill

October 30th, 2018 by Joshua S Hill 

American solar PV manufacturer First Solar announced its third-quarter earnings late last week, revealing increased sales and earnings with an escalating order book of 11.3 gigawatts (GW), but investors were not impressed with what they considered a revenue “miss” and shares have slumped nearly 10% off the back of the announcement.

First Solar published its financial results for the third quarter of 2018 last Thursday, revealing net sales/revenue of $676 million — an increase of $367 million over the previous quarter, which was an expected weak quarter due to expected lower system and third-party module sales. The third-quarter increase was due primarily to ongoing construction activities at the California Flats project and the sale of its Willow Springs and Manildra projects.

The company reported third-quarter earnings of $0.54 per share, compared to a loss per share of $0.46 reported in the second quarter, and beating market expectations by $0.11 per share. Cash and marketable securities at the end of the third quarter amounted to $2.7 billion, decreasing from $3.1 billion at the end of the second quarter, due primarily to ongoing capital investments in ramping up the company’s Series 6 manufacturing capacity.

“We had good execution in the third quarter as we closed the sales of certain key projects and delivered solid financial results,” said Mark Widmar, CEO of First Solar. “In addition, with the start of Series 6 production at our Vietnam factory we now have three locations manufacturing our most advanced product. Demand for Series 6 continues to be resilient as demonstrated by bookings of 1.1 GW since our prior earnings call. This brings our total contracted volume to 11.3 GW and provides us with a strong competitive advantage as we move forward.”

Despite consistent increases to the company’s order book and its near-company-wide shift to manufacturing its large-format Series 6 solar modules, investors were unimpressed and focused instead on the 38% year-over-year decrease to revenue.

“Even including the impacts of Section 201 tariffs, the price of modules with Chinese brands (made in Southeast Asia) is experiencing 20% cut in the US in 2018, because intense glut in the crystalline silicon PV industry triggered price collapse along the whole value chain, starting from polysilicon, whose spot price has dropped by about 45% so far this year,” explained Xiaoting Wang, a solar analyst with Bloomberg New Energy Finance.

“The advantage of First Solar’s Series 6 is the larger size, corresponding to more power output per module. However, Series 6’s module efficiency is 17-17.4%, still apparently lower than the monocrystalline silicon products’ 17.7-18.9%. Larger modules could help lower per watt non-module costs, including racking and installation, etc. When the quote from crystalline silicon module providers is low enough, savings on modules could outweigh the system savings by larger S6 modules.”

Additionally, investors reacted negatively to the company’s full-year guidance which was adjusted to account for lower-than-expected module sales, higher manufacturing ramp costs, and the fact that the Ishikawa project in Japan will now be sold in 2019.

Specifically, revenue for the full-year has been downgraded from between $2.5 billion to 2.6 billion, down to between $2.3 billion to $2.4 billion. Gross margin has also been cut to between 18.5% to 19.5%, and earnings per share were shaved from between $1.50 to $1.90 per share down to between $1.40 to $1.60 per share. Shipments have also been downgraded from between 2.8 GW to 2.9 GW down to between 2.6 GW to 2.7 GW.

The company’s Series 6 ramp up continues, with manufacturing throughput at its factories in Ohio, Malaysia, and Vietnam all increasing steadily.

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Tags: financial earnings, First Solar, Q3’18, quarterly earnings, Third Quarter

About the Author

Joshua S Hill I’m a Christian, a nerd, a geek, and I believe that we’re pretty quickly directing planet-Earth into hell in a handbasket!

I also write for Fantasy Book Review (, and can be found writing articles for a variety of other sites. Check me out at for more.

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