Hanwha SolarOne losses shrink amid soaring shipments

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Hanwha SolarOne has today reported its fourth quarter and full year 2013 financial results, revealing that the company ended the year on a high with total net revenues for the final quarter up 14.1% compared to Q3, and up 54.8% year-on-year.

Generating $213.9 million in the fourth quarter, the Korean solar company was able to drastically reduce its losses, raising confidence and expectations that 2014 will see the company return to profit.

Driving this recovery was a dramatic increase in module shipments, spurred largely by massive demand from Japan and China. In fact, in the last half of the year Japan and China accounted for nearly 60% of all shipments. If the U.S. is included in that band, the three leading solar markets made up 70% of Hanwha SolarOne’s business for the second half of 2013.

In total, the company shipped 352.2 MW of modules in the fourth quarter of 2013 – a 77.1% year-on-year increase.

Hanwha SolarOne’s operating losses fell to just $3.9 million in the final quarter, with the company ending the year with an operating margin of negative 1.8% — an impressive turnaround from the negative 74.8% operating margin recorded at the end of 2012.

Total net revenues for the year totaled $780.6 million, a 28.5% increase on 2012, with total module shipments for 2013 topping 1.28 GW, which represents an increase of 54.3% on 2012. Following such a solid end to the year, Hanwha SolarOne’s business outlook for 2014 appears rosy: the company expects module shipments of between 1.5 – 1.6 GW this year, and a gross margin targeted to be in the range of 15-20%.

"The final quarter of 2013 was marked by significantly improved financial results, and when excluding year-end non-cash charges and other non-GAAP accounting treatments unrelated to the operations of our business, we would have recorded profitability," said Hanwha SolarOne CEO and chairman, Ki-Joon Hong.

"This financial progress was achieved through increased revenues and shipments, reductions in our manufacturing cost structure, and continued diligence in controlling operating expenses."

The chairman added that the company maintained a strong presence in Japan and increased its penetration of the Chinese market, before pointing out that this year’s financial performance is shaping up to be even better.

"We are optimistic that 2014 will prove to be a much stronger year for Hanwha SolarOne, with further shipment growth and additional reductions in our cost structure including notably better operating metrics at our internal ingot and wafer facility.

"We also intend to establish a downstream presence in China and grow our China business by leveraging several recently established strategic partnerships. We plan to expand capacity to meet growing global demand, as well as automate existing manufacturing to reduce cost and improve product consistency and quality."