Yingli shipments, revenue and profit falls sharply Y/Y in Q2 2015


Chinese Tier-1 solar company Yingli Green Energy registered sizeable reductions in PV module shipments and revenue in the second quarter of 2015, according to the company’s Q2 results that were published today.

Total net revenues for Q2 fell to RMB2,716.1 million ($438.1 million) on the back of plunging shipments and a lower average selling price (ASP) for Yingli’s modules. In Q1, Yingli posted revenues of RMB2,905.8 million ($468.7 million) while last year’s second quarter performance generated revenues of RMB3,408.9 million ($535.5 million).

Falling shipments were to blame, with Yingli shipping just 727.9 MW of modules in Q2 compared to 754.2 MW in Q1 and 887.9 MW in Q2 2014. Of that 727.9 MW figure, a larger proportion than ever went to the Chinese market, where ASPs are lower than in many other leading solar regions. In fact, Yingli increased its shipments to its domestic market by 110% in Q2, growing its shipments to the U.S. by 35% over the same period.

Pre-financials guidance released in late August warned that the company’s profit margin could be more than halved in Q2, and so it came to pass: gross profit came in at RMB171 million ($27.6 million), less than half of the RMB410.8 million ($64.5 million) for Q1 and some way below the RMB532.1 million registered in Q2 2014.

The solar firm was able to reduce its operating expenses by $56.3 million over the second quarter, largely as a result of disposing of the land use rights held by its subsidiary, Fine Silicon, which helped to bring operating expenses as a percentage of total net revenues to 12.9%, down from 16.4% in Q1 and 18.1% in Q2 2014.

Losses, however, almost tripled to RMB178.3 million ($28.8 million) in Q2 compared to losses of just RMB66.4 million in Q1, triggering a negative 6.6% operating margin for the quarter.

The company managed to repay a RMB1.2 billion three-year unsecured medium-term debt during the second quarter, and Yingli chairman and CEO Liansheng Miao stressed that the company is "actively taking measures to prepare for repayment of the RMB1 billion five-year unsecured medium-term notes" when they become due in October. Miao added that Yingli is exploring a number of financing options to ensure the debt is repaid on time, including the "liquidation of idle assets, introduction of strategic investors and potential new cooperation model with our business partners".

Miao also said that Yingli is to adopt a new core principle based around less investment and quicker turnover, in order to "maintain a stable cash flow".

Over the course of 2015 Yingli has lost around two-thirds of its market value, and first warned its shareholders in May that the company had doubts about its ability to continue as a going concern given its hefty debt burden.

The losses reported today are the 16th straight loss the company has registered, and will seek to raise further funds by selling land in order to meet the October 13 bond deadline. A further RMB1.4 billion note is set to mature in May next year, and Bloomberg has reported that the company may need to take a debt reorganization in order to survive in 2016.