Shifting market dynamics continue to affect Chinese PV manufacturers quarterly reporting, with ReneSola proving no exception in its Q3 2014 financials, which it reported today. ReneSola was able to increase gross margins on both on an annual and quarterly basis. Operating margin was 2.3%, totaling $10.6 million, however a net loss of $11.7 million was reported.
"Our results in Q3 2014 were mainly impacted by the depreciation of the European currencies that led to a foreign exchange loss of $13.7 million, and by a delay in shipments due to the anticipation of new lower minimum imported prices in Europe, which were announced towards the end of Q3 2014, said Xianshou Li, ReneSola's CEO.
However, our fully integrated international sales, support, and logistics platform, our global manufacturing footprint, and our focus on retail-oriented and downstream opportunities continue to keep us in an advantageously competitive position.
Flexibility certainly appears to be the name of the game and ReneSolas module shipments reflect this. Its U.S. shipments continued to decline YOY from 30.8% in Q3 2013, to 8% last quarter. Shipments to the U.S. declined on quarterly basis from 11.2% in Q2 2014.
By contrast, and despite shipments delayed to Q4 2014 and Q1 2015 in expectation of a reduction of a reduction in EU minimum prices, European shipments are on the up for ReneSola. Totally 46.8%, these represent growth from 38.8% in Q3 2013 and 31.4% in Q2 2014.
The UK market featured prominently in European modules shipments for ReneSola, including a 13 MW power plant project it is developing in Englands southwest and 22 MW of its Vitrus I and II module series to two projects it is supplying elsewhere in the country.
Commenting on the quarters results, Daniel K. Lee, the companys CFO noted that the Q3 2014 gross margin reflects two consecutive quarters of growth.
"While we focus on expanding our commercial, retail and downstream initiatives, we continue to follow a prudent financial approach and asset-light strategy in order to grow our margins while improving our cash flow, said Lee. Our cash flow from operations improved from an outflow of $40.6 million in Q2 2014 to an outflow of $10.7 million, of which almost $10 million was payment used for our downstream projects in the UK."