REC Solar achieves $16.2 million second-quarter profit


Norwegian PV manufacturer REC Solar ASA on Thursday posted a second-quarter net profit of $16.2 million (€12 million) on revenue of $175.8 million (€130.5 million).

REC Solar was spun off Renewable Energy Corporation (REC) in September last year after the parent company split its business, which also resulted in the creation of the separate REC Silicon ASA.

REC Solar's second-quarter revenue was down slightly compared to last year, when the then division posted second quarter revenue of NOK 1.07 billion (€136 million) and earnings before interest, tax, depreciation and amortization (EBITDA) of NOK 75 million (€9.5 million). By comparison, REC Solar’s EBITDA figure in the second quarter of this year reached $21.1 million, or €15.7 million.

The company’s module production reached 232 MW in the period, up 7.4% from the first three months of 2014.

"REC's second quarter of 2014 was characterized by high sales volumes in Europe, softer market conditions in Japan and sales pipeline building up in the U.S. market,” said REC Solar CEO Martin Cooper.

"The launch of our Peak Energy 72 series panels and our recently announced sales agreement with SolarCity demonstrate our ability to react quickly to market opportunities,” Cooper added, stressing that REC was “well positioned to capitalize on the market opportunities in the U.S. market."

The chief exec said the company continued to focus on reducing its solar panel cash costs per watt to remain competitive and added that the group’s furnace upgrade and module capacity expansion in Singapore was progressing according to plan.

Speaking to pv magazine, Luc Graré, REC Solar’s senior vice president of Sales and Marketing for Europe, the Middle East, Africa and South America, said Europe remained the company’s main market in the second quarter, accounting for 60% of overall sales with 135 MW of solar modules sold. The United Kingdom proved the company’s biggest market between April and June with 62 MW of panels sold, followed by Germany with 52 MW.

Graré added that REC Solar saw great potential in the United States. In June, REC Solar signed a supply agreement with leading U.S. solar provider SolarCity for a minimum of 100 MW and up to 240 MW of REC’s Peak Energy solar panels for a one-year period beginning in the fourth quarter of 2014. SolarCity, the U.S.’ largest solar power provider, plans to install the solar panels across its 15-state service territory.

Sales in Japan, meanwhile, were down compared to the same perdiod last year. The country accounted for 29% of REC Solar's overal sales in the second quarter of 2013 and 37% in the first quarter of 2014 but only 25% in Q214.

Graré furthermore pointed out that PV panel prices dropped 1.5% from Q114 to Q214 while shipments in the period rose 1.2%.

Graré said the company was seeking to reduce costs by between 8-12% this year, adding that savings might be in the lower end of that target due to the fact that its factory capacity expansion was not yet completed and additional wafer purchases have been necessary for its module production.

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