First Solar to expand manufacturing capacities, but no yieldco

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The financial metrics reported by First Solar in the third quarter of 2014 were largely unremarkable. The company brought in US$889 million in revenues, something of a mid-point in its roller coaster ride over the last few years, with fluctuations due to uneven timing of project completion.

The company also reported a 9.4% operating margin, and a healthy profit of $88.4 million. What was more telling was the company’s announcements for the future. During its earnings call First Solar CEO Jim Hughes reported that the company will both restart idled module lines in Malaysia and adding two new lines in its factory in the U.S. state of Ohio.

When combined with greater utilization of existing lines, First Solar estimates that its manufacturing capacity could increase up to 46% in 2015, rising from its current around 1.8 GW annually to around 2.6 GW.

“It’s not a mystery to everybody that the step-down of the investment tax credit in the U.S. market at the end of 2016 continues to pull demand forward,” explained First Solar CEO Jim Hughes. “We want to maximize our ability to capture that demand.”

This is particularly ambitious given that First Solar only ran at 77% capacity utilization during the third quarter. First Solar notes that less than full capacity utilization was in part due to ongoing technology upgrades.

The company also expects greater demand for its offerings going forward due to technology improvements. First Solar increased its fleet average efficiency to 14.2% in during the quarter, and during October its best line produced 14.6% efficient modules.

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