Hanwha SolarOne cuts second-quarter loss, boosts module shipments

Reporting its unaudited financial results for the second quarter on Thursday, China’s Hanwha SolarOne narrowed its net loss to CNY 54.8 million ($8.8 million), down from CNY 166 million a year ago.

Company revenue in the period dropped 6.4% year on year to CNY 1.1 billion ($178.5 million), while PV module shipments, including module processing services, rose 5.7% to 339.5 MW over the same period last year.

Stressing that the second quarter was characterized by an increase in shipments and a significant reduction in net loss, Hanwha SolarOne Chairman and CEO Seong-woo Nam said "gross margins were driven down by a lower average selling price, reflecting a decreasing proportion of sales from the higher-priced EU market, particularly the U.K., and an increasing proportion from the relatively lower priced China market."

The company, he said, maintained its strong position in Japan and began shipments to several newer emerging markets, adding that the group "continued to maintain tight control over operating expenses."

Looking forward, Nam said the company expected strong growth in quarterly shipment volumes beginning in the third quarter, driven by good visibility in China; opportunities for cost reduction due to increased efficiency and improved utilization for its ingot and wafer manufacturing lines; the introduction of new four busbar cell technology; reduced processing costs from decreased use of raw materials; increased automation of production lines; and the addition of new cell and module lines.

"Module manufacturers continue to compete intensely on price and we expect to continue to see decreasing average selling prices near term that make gross margin expansion challenging in the near term,” he said.

Looking at its operations worldwide, Hanwha SolarOne again maintained a strong presence in Japan, which represented 53% of module shipments worldwide in the period. The United States reversed its position with the United Kingdom from the prior quarter to become the second largest market for the company. The U.K. market declined in the quarter to account for 9% of total shipments, due to lower demand for utility-scale solar projects after a change in the incentive scheme, the company said.

Deliveries to South Korea and Canada picked up 9% and 7%, respectively, in the quarter.

The company also reported a rebound in shipments in China, which accounted for 6% of the 339.5 MW of modules shipped.

Hanwha SolarOne added that it continued to see momentum building in China and expected strong demand in the second half of the year. The company’s newest markets include Turkey. Overall, the group increased module shipments to 23 countries during in the quarter, including Europe and Africa, which together accounted for 12% of module shipments; Asia Pacific, which made up 70%; and North America (18%).