Hanwha SolarOne narrows first quarter net loss as shipments rise

Hanwha SolarOne posted a loss of CNY 225.9 million ($36.4 million) compared to CNY 303.7 million ($49.5 million) in the first quarter of 2012. Revenue rose 38% to CNY 1.1 billion ($179.2 million).

Echoing other major Chinese players, Hanwha SolarOne Chairman and CEO Ki-Joon Hong said the company was moving into markets outside of Europe.

"Our effort to diversify business outside traditionally large markets in Europe, to large new emerging markets such as China, Japan and South Africa, is well underway."

Addressing the trade dispute between the EU and China, Hong said: "The proposed import tariff in the EU against solar products manufactured in China is an unfortunate process as it will ultimately harm competitive pricing in Europe as well as hinder solar development through reduced project returns and reduce solar jobs."

Hanwha SolarOne is "well-prepared to handle this challenge," he added, stressing that the company had "aggressively" diversified its business outside the EU. Shipments to the EU are now below 30% of total shipments compared to over 70% historically.

Hong said he hoped negotiations between the governments of both regions would "ultimately reach a more rational and productive outcome."

Hanwha has faced a tough market in view of global oversupply and falling prices, but Hong described the first quarter as "an important inflection point for both the solar industry and the Company, with a number of positive signs developing for further progress ahead."

Prices improved from the fourth quarter and appeared to have stabilized, he added.

The company’s gross margin climbed to 2.6% from a negative 9.4% a year ago as gross profit rose to CNY 28.9 million ($4.7 million), compared with a gross loss of CNY 75.2 million ($12.3 million) a year earlier.

Module shipments saw robust growth, up from 160.7 MW a year ago to 289.1 MW. Hong added that the company’s investment in new products was beginning to deliver results with the introduction of the new HSL Series of smaller, lighter and higher-efficiency modules.

Hong said that "a number of positive developments" currently visible in the industry indicated "a gradually improving business environment in 2013, and a much more positive industry upturn from 2014 to 2015," including the fact that a large number of competitors had shut down or gone bankrupt, resulting in reduced industry overcapacity. In addition, the average selling prices for solar modules have improved in most markets and new emerging markets like Japan and South Africa offer above average pricing and a growing number of financing options, including leasing schemes, are supporting investment in solar, he added.