LDK Solar suffers significant 2011 losses


LDK Solar has seen its financials badly hit in the last quarter of 2011, due to the "dislocation" of the solar market, which included rapidly falling average selling prices and weak market demand.

Loss from operations was a massive $531.4 million, compared to $77.1 million in Q3 2011, and an income of $203.8 million in Q4 2010. The company’s operating margin, meanwhile, was a huge -126.5 percent, compared to -16.3 percent in Q3 2011, and 22.1 percent in Q4 2010.

Gross performance didn’t fare any better, with LDK posting a gross loss of $275.2 million, up significantly from $17 million in Q3 2011, and a gross profit of $251.4 million in Q4 2010. Gross margin was -65.5 percent, compared to -3.6 percent in Q3 2011, and 27.3 percent in Q4 2010.

Overall, the company recorded net sales of US$420 million in Q4 2011, down from $471.9 million in Q3 2011, and $920.9 million in Q4 2010. This figure missed its revised sales guidance, which was altered in March from between US$440 million to $520 million, to $440 million to $450 million.

In terms of its products, LDK says it shipped 197.1 megawatts (MW) worth of wafers in Q4 2011, and 255.5 MW of photovoltaic cells and modules. Meanwhile, it produced around 149.6 MW of cells and roughly 2,317.8 MT of polysilicon.

While the company didn’t offer any thoughts on full year 2011, it did say it expects to reap revenues of between $2 billion and $2.7 billion in 2012. For Q1 2012, it forecasts revenues of between $190 million to $230 million. Furthermore, it predicts that wafer shipments will hit 140 to 150 MW, cell and module shipments 170 MW to 180 MW, in-house polysilicon production 1,800 MT to 1,900 MT and in-house cell production 40 MW to 50 MW.

"In 2012, we expect that excess capacity and further policy uncertainties in Europe and the U.S. will result in continued intense competition within the solar industry. As such, we remain focused on improving our cost structure by driving down production costs and closely managing our operating expenses.

"PV applications are increasing globally with improved affordability for solar electricity. We continue to believe that the considerable opportunities to meet global energy needs with solar power will drive long-term market growth," concluded chairman and CEO, Xiaofeng Peng.