ReneSola – a leading Chinese solar power company – has posted relatively heavy fourth quarter (Q4) losses for 2016, capping the end of a year that saw the firm’s revenue contract 27.5% against 2015.
Over the course of 2016 ReneSola’s revenues were $929.8 million, down from $1,282 million in 2015. Gross profit for the year also slumped, falling 41.7% from $187.9 million in 2015 to just $109.5 million last year.
The fourth and final quarter of the year did, however, signal signs of improvement for the firm, which is shifting its business focus from production to downstream power projects. In Q4, revenue of $232.1 million was in line with the $220 million to $240 million guidance, and some 24.1% higher than in Q3 2016. Net loss rose from $20.5 million in Q3 to $25.5 million at the end of the year, and against $6.7 million in net income for Q4 2015.
The company’s slight revenue increase in Q4 was a result of the easing of the Chinese solar market slump, with domestic module shipments accounting for 69% of its overall shipment figure, up from 56% in Q3. Module average selling prices (ASPs) of $0.44/W were reported, as was a sharp decline in shipments to India – falling to 6% of overall shipments in Q4, from 21% in Q3.
“Our overall business conditions in Q4 were mixed,” said ReneSolar CEO Xianshou Li. “While the overall market environment was challenging in 2016, we have been executing our strategy to shift our business focus from manufacturing business to downstream project development business since the second half of 2015.
“We expect downstream project sales to pick up in the second quarter of 2017 due to the growth in pipeline as well as our solid execution in project monetization.”
For the full year 2016, net loss was $34.7 million compared to a net loss of $5.1 million in 2015. Project sales last year reaped some revenue in Q4 as ReneSola sold six projects in the U.K. totaling 26 MW, as well as distributed generation (DG) projects in China totaling 2 MW. The company’s project pipeline as of March 20 this year stood at more than 1 GW, of which 707 MW are shovel-ready. Over half of the shovel-ready capacity is in China.
Looking ahead to Q1 this year, revenue is poised to come in between $130 to $150 million, with external wafer shipments in the range of 240 MW to 260 MW, and modules in the range of 250 MW to 260 MW. Over the course of 2017, ReneSola expects revenues of between $900 million to $1 billion.