Hanwha SolarOne cuts first-quarter net loss, increases revenue

Chinese PV manufacturer Hanwha SolarOne posted a 2.3% year-on-year increase in first-quarter revenue to CNY 1.14 billion ($183.1 million) while narrowing its net loss by 41% to CNY 133.4 million ($21.46 million).

Hanwha SolarOne, a subsidiary of South Korean conglomerate Hanwha Corporation, reported shipments of PV modules, including module processing services, of 323.6 MW in the quarter, an 11.9% increase from 289.1 MW in the first quarter of 2013.

Hanwha SolarOne Chairman and CEO Seong-woo Nam said first quarter results were primarily impacted by a slowdown in demand in China as well as the expected devaluation of the Chinese yuan.

Nam noted that the slowdown was a result of seasonality and delayed project installations as customers anticipated more lucrative government subsidies later this year. He added that the expected devaluation of the yuan had led to a foreign exchange loss for the quarter.

"Our core business remained strong," Nam stressed. "We continued to maintain our strong position in the Japanese market and made good progress towards filling our allocation in the EU. Our average selling prices remained firm at the high end of peer averages, and we continued to effectively manage operating expenses."

Nam said shipment volumes looked promising for the remainder of the year. The company anticipates up to a 14% increase in shipments from the first quarter to the second quarter. Demand in China is beginning to warm and the company expects a strong second half of the year in the market as the government increases incentives and improves the availability of credit for select companies.

"We expect business opportunities to develop further in China with cooperation from our strategic partners, including downstream project development," Nam said.

The chairman added that there was good potential for cost reduction this year, particularly as the company increases utilization and reduces costs at its internal ingot and wafer operation. The conversion of existing module lines to full automation beginning mid-year will also cut costs and improve quality, he said.

Nam said synergies with affiliate solar company Hanwha Q CELLS remained strong as the companies exchange technology, share manufacturing expertise and integrate supply chains.

"Finally, we are now prepared to increase cell and module capacity to 1.5 GW and 2 GW respectively, positioning us to enter 2015 with higher capacity to meet a significant anticipated increase in demand," Nam said.