Yinglis gross profit for the second quarter of the year (Q2) also increased by 11 percent from the first quarter of the year (Q1), from RMB 815.4 million to RMB 905.1 million (USD$133.5 million). In comparison with Q2 of last year, the company saw its gross profit rise 205.4 percent. It added that based on current market and operating conditions, estimated production capacity and forecasted customer demand, it reaffirms its photovoltaics (PV) module shipment target to be in the estimated range of 950 megawatts to one gigawatt for this fiscal year, which it says represents an increase of 80.8 to 90.4 percent compared to the last fiscal year.
Total net revenues were RMB 2,699.6 million (USD$398.1 million) in Q2, an increase of 10.2 percent from RMB 2,449.9 million in Q1 and 80.1 percent from RMB1,498.9 million in Q2 of 2009. The increase in total net revenues was primarily due to the mid teen growth rate in PV module shipment volume quarter over quarter, partially offset by the depreciation of the euro against the Renminbi, explained the company.
Operating expenses in the second quarter of 2010 were RMB 339.7 million (USD$50.1 million), compared to RMB 279.5 million in Q1 and RMB 189.5 million in Q2 of 2009. The increase in operating expenses this quarter was primarily attributable to higher selling expenses relating to the 2010 FIFA World Cup sponsorship, as well as increasing research and development expenses in connection with the progress of a series of research and development initiatives, including second generation PANDA cells and collaboration with Innovalight, stated the company.
Operating expenses as a percentage of total net revenues were 12.6 percent in Q2, compared to 11.4 percent in tQ1 and 12.6 percent in Q2 of 2009.
It went on to say that operating income in Q2 was RMB 565.4 million (USD$83.4 million), compared to RMB 535.9 million in Q1 and RMB 106.8 million in Q2 of 2009. Operating margin was 20.9 percent in Q2, compared to 21.9 percent in Q1 and 7.1 percent in Q2 of 2009.
In terms of net income, the company saw a loss in comparison with the same period last year. Net income was RMB 217.8 million (USD$32.1 million) in Q2, compared to a net income of RMB 190.9 million in Q1 and a net loss of RMB 393.7 million in Q2 of 2009. Diluted earnings per ordinary share and per ADS was RMB 1.41 (USD$0.21) in Q2, compared to diluted earnings per ordinary share and per ADS of RMB 1.24 in Q1 and diluted loss per ordinary share and per ADS of RMB 3.03 in Q2 of 2009.
"The past few months have been very exciting for us in many ways," commented Mr. Liansheng Miao, chairman and CEO of Yingli Green Energy. "In the second quarter of 2010, we achieved a mid teen percent sequential increase in PV module shipment volume and realized a record high gross margin of 33.5 percent. In addition to delivering solid operational results, the company also reached important milestones on many other fronts. In terms of marketing, our 2010 FIFA World Cup sponsorship has made a huge splash.
"As the market for distributed electricity generation is expanding in many major solar markets, the power to influence and decide the solar industry’s future is rapidly vesting to the general public. We believe our groundbreaking 2010 FIFA World Cup sponsorship project, accompanied by a series of marketing initiatives, has effectively boosted our brand recognition both within and outside of the conventional solar community, which is expected to greatly enhance our competitive advantages in this new era. Furthermore, supported by our reliable products and services, we expect to enjoy a pricing premium and receive stronger demand as a result of our ever-increasing brand equity."