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Yingli experiences first quarter declines, but remains positive

Despite posting sequential declines in both its photovoltaic module shipments and financial results, Yingli Green Energy Holding Company Limited remains confident that it can meet its full year shipment guidance. It adds that Europe remains a key market.

Liansheng Miao, chairman and CEO of Yingli says that Europe is one of the most important markets. Image: Solarpraxis/Hans-Christoph Neidlein.

The Chinese photovoltaic module manufacturer experienced a "sudden demand slowdown" in Europe, primarily due to the Italian market uncertainty and bad weather seen in Germany last winter. As such, its module shipments saw a decline of "a low teen percentage" in the first quarter of this year from the fourth quarter of 2010.

Despite this, the company remains confident that it can ship between 1.7 to 1.75 gigawatts of modules throughout the whole of 2011. If achieved, this would represent an increase of between 60.1 and 64.8 percent compared to fiscal year 2010.

In terms of its net revenues, Yingli reaped RMB 3,453 million (US$527.3 million) in the first quarter of 2011. This represents a 40.9 percent increase from RMB 2,449.9 million in the first quarter of 2010, but a decline from the fourth quarter, which saw RMB 4,066.2 million.

Net income notably decreased in the first quarter of this year, from RMB 522 million in the fourth quarter of 2010 to RMB 368.3 million (US$56.2 million). However, in comparison to the first quarter of 2010, the company increased its net incomes by 93 percent from RMB 190.9 million.

Gross profit, meanwhile, dropped from RMB 1,337.7 million in the fourth quarter of 2010 to RMB 943.7 million (US$144.1 million) in the first quarter of 2011. However, it represents an increase of 15.7 percent from the first quarter of 2010, which reaped RMB 815.4 million.

On the other hand, overall gross margin decreased from 33.3 and 32.9 percent in the first and fourth quarters of last year respectively to hit 27.3 percent in the first quarter of this year. In a statement, the company said that the sequential decrease was primarily due to the increase of outsourced cell production and polysilicon spot price, as well as a slight decrease in average selling price.

Operating expenses also fell, from RMB 394.3 million in the fourth quarter of last year to hit RMB 375.5 million (US$57.3 million) in the first quarter of 2011. However, they rose from the first quarter of 2010 (RMB 279.5 million).

Commenting on the declines, Liansheng Miao, chairman and CEO of Yingli said: "Although solar policy changes in certain European countries have caused short term market fluctuations, in the long term, we continue to view Europe as one of our most important markets."