ReneSola’s net revenues continue to fall on back of downstream shift

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Despite recording a number of losses in the quarter, Chinese solar PV company, ReneSola Ltd is positive its new business direction is paying off. "The second quarter of 2015 represented an important turning point for ReneSola as we began to reap the benefits of our downstream efforts," said CEO, Xianshou Li.

The company’s aim to scale back module manufacturing was clear to see, as module shipments fell from 496.4 MW and 498.7 MW in Q1 2015 and Q2 2014, respectively, to 322 MW this Q2. Overall, solar wafer and module shipments were 603.7 MW, compared to 691.5 MW in Q1 2015, and 698.3 MW in Q2 2014.

Net loss was $2.3 million, an improvement on the loss of $18 million seen in Q1, but still down from the $757 million profit seen in Q2 2014.

Net revenues, meanwhile, decreased on the back of lower module sales, to US$268.4 million, down from $349 million in Q1, and $387.1 million in Q2 2014. Boosted by the sale of solar projects in the U.K., and following material and processing cost reductions, ReneSola saw increases in both its gross profit and margin, respectively, from $36.7 million and 10.5% in Q1, and $56.9 million and 14.7% in Q2 2014, to $44.4 million 16.5%.

Looking ahead to Q3, the company expects net revenues to be in the range of $330 million to $340 million, and a gross margin between 15 and 16%.

Downstream focus

In the second half of 2015, ReneSola plans to develop and build over 300 MW of PV projects, which are expected to be operational by 2016.

Currently, the company has around 77.4 MW of existing projects, including 51.1 MW in U.K., 1.2 MW in Japan (total Japanese pipeline: 32.4 MW), 9.7MW in Bulgaria and 15.4 MW in Romania. It also has a late stage project pipeline with over 200 MW in development across the U.K., U.S. and Japan.

Meanwhile, through its Baynergy joint venture with Pristine Sun, "ReneSola is the majority interest holder, to develop, build and operate over 300MW of solar projects across the country, including a first phase of 82 projects totaling 151.8MW, most of which are distributed generation projects. Currently Baynergy has 88MW accepted in California, Minnesota and North Carolina, with expected completion by the end of 2016."