Chinese market driving growing JA Solar shipments

JA Solar has continued to increase its solar production and its downstream portfolio in Q2 2015, as it continues to transition from a PV wafer and cell manufacturer to a module supplier and project developer. While module shipments grew 60.9% Y/Y, to 717.4 MW for the quarter, its cell shipments decreased by 68.9% to 73.4 MW.

On these sales JA reported revenues of RMB 2.7 billion ($436.8 million), representing Y/Y growth of 11.8% and 12.7% M/M. The company’s gross margin for Q2 was 16.4%, a 120 basis point jump compared to Q2 2014. An operating profit of $25.2 million was reported, up from $14.5 million Y/Y.

“Solid shipment growth was largely driven by demand in China, which represented 45% of our total shipments during the second quarter,” said JA chairman and CEO Baofang Jin, in a statement.

JA Solar is one of a growing number of Chinese solar producers establishing manufacturing operations outside of China. “We continue to make progress on the establishment of our new cell manufacturing plant in Malaysia,” said the company’s CEO today.

CEO Baofang Jin said that JA expects demand to remain strong throughout the year and that the company’s downstream portfolio will continue to grow throughout the year.

The shipment figure of 790.8MW is above the previous guidance of 680 to 720 MW.

JA Solar reports that is cash and cash equivalents of $282 million, with working capital of $480.9 million. Borrowings was at the lower end of the spectrum when compared to some bigger rivals, with $307.6 million in short term borrowing, and long term borrowings of $399.3 million. Of this $20.4 million in due in one year.

Looking forward, the company expects to record shipments between 900 MW and 950 MW for Q3 2015, with 150 MW of that going to its own projects.

JA is continuing with a share buyback program, purchasing 1,023,903 million of its American Depositary Shares.

Indications are that JA Solar is continuing to assess an internal takeover bid from chairman and CEO Baofang Jin. A committee to assess the bid retained legal council to assist with deliberations last month.

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