2011 was already a bad year for the worlds leading photovoltaic module manufacturer, which suffered net losses of over US$1 billion. Having concluded Q1 2012, Suntech has continued to see dramatic drops. It has also received preliminary countervailing and anti-dumping duties of 2.9 percent and 31.22, respectively.
Overall, Q1 2012 net revenues were $409.5 million, down from $629 million in Q4 2011, and $877 million in Q1 2011. Cost of revenues, meanwhile, was $407.1 million, compared to $566.7 million in Q4 2011 and $694.3 million in Q1 2011.
In terms of gross profit, the company achieved just $2.4 million in Q1 2012, compared to $566.7 million in Q4 2011, and $694.3 million in Q1 2011. Gross margin was also impacted, having fallen from 9.9 percent in Q4 2011, and 20.8 percent in Q1 2011, to 0.6 percent in Q1 2012. "Gross profit and gross margin were impacted by a provision for preliminary U.S. countervailing and anti-dumping duties of $19.2 million, or 4.7 percent of revenues," explained the company in a statement released.
Operating expenses were sequentially slightly better at $121.6 million, compared to $126.5 million in Q4 2011, but up from Q1 2011, which recorded $88.2 million in Q1 2011. Loss from operations, however, was hard hit, having fallen from a loss of$64.2 million in Q4 2011, and an income of $94.5 million in Q1 2011, to a loss of $119.2 million in Q1 2012. Operating margin was negative 29.1 percent, compared to negative 10.2 percent in Q4 2011, and positive10.8 percent in Q1 2011.
Photovoltaic module shipments also decreased. While Suntech did not provide specific figures in megawatt terms, it said they fell 26.9 percent sequentially and 22.1 percent year-over-year. "The sequential decrease in shipments was primarily due to limited inventory on hand early in the quarter and a planned reduction in our production level over Chinese New Year," explained chairman and CEO, Zhengrong Shi. He added, "During the quarter, we reduced our total production cost by six percent sequentially, despite lower utilization, and maintained a healthy cash balance."
Looking ahead to Q2 2012, Suntech forecasts that module shipments will sequentially increase by more than 20 percent and that gross margin will be in the range of three to six percent. For the full year, it maintains its shipment guidance of 2.1 to 2.5 gigawatts (GW). Furthermore, it expects to maintain cell and module production capacity at 2.4 GW and wafer capacity at 1.6 GW.
"Full year 2012 capital expenditures are expected to be in the range of $120 million to $150 million. Capital expenditures will primarily be related to payments for equipment and services already received, and technology upgrades to production lines," continued the statement.
This content is protected by copyright and may not be reused. If you want to cooperate with us and would like to reuse some of our content, please contact: firstname.lastname@example.org.
By submitting this form you agree to pv magazine using your data for the purposes of publishing your comment.
Your personal data will only be disclosed or otherwise transmitted to third parties for the purposes of spam filtering or if this is necessary for technical maintenance of the website. Any other transfer to third parties will not take place unless this is justified on the basis of applicable data protection regulations or if pv magazine is legally obliged to do so.
You may revoke this consent at any time with effect for the future, in which case your personal data will be deleted immediately. Otherwise, your data will be deleted if pv magazine has processed your request or the purpose of data storage is fulfilled.
Further information on data privacy can be found in our Data Protection Policy.