China Sunergy suffers significant losses

Overall, China Sunergy achieved net revenues of US$566.2 million in 2011, up slightly from 2010, which recorded $517.2 million. Gross profit was also up from 2010, having grown from $92.3 million to $1.8 billion.

While positive, these figures were usurped by the company’s operating loss, which amounted to $94.3 million, up dramatically from an income of $51.7 million in 2010. Total operating expenses also grew, from $26.3 million in 2010, to $81.8 million in 2011. Gross margin, meanwhile, fell from a solid 17.8 percent to 0.3 percent in the same period.

China Sunergy’s solar cell business also took a big hit, with the company selling just 6.6 megawatts (MW) worth of cells last year, compared to 277.2 MW in 2010. The average selling price (ASP) slipped from $1.35 per Watt (/W) to just $0.84/W.

Its module business fared better, with 411.5 MW being sold in 2011, compared to 67.2 MW in 2010. In this period, ASP dropped from $1.92 to $1.36. Overall, this area was said to have contributed to 98.6 percent of China Sunergy’s net revenues. It is forecast that this trend will continue into the future.

"We expect solar power product prices to further decline in the near future due to decreased feed-in-tariffs in most European countries, increases in manufacturing capacity in our industry, decrease in polysilicon price, increased production efficiencies and reduced manufacturing costs as a result of improving technology," explained the company in its 2011 annual report.

In terms of markets, Italy, France and Germany were identified as key. However, the company said that the U.S., China, India, Australia and other emerging markets will become more important.

Capacity ramp up

Overall, China Sunergy has 13 solar cell lines, worth 404 MW. "We plan to increase the above manufacturing capacities by adding new manufacturing lines in response to growing demand for our solar power products," it said.

This will involve establishing a new cell project in Yangzhou, in China’s Jiangsu Province. The target is to increase capacity to one GW; construction is slated to start in the first half of this year.

With regards to its module business, China Sunergy manufacturers 915 MW annually.