Hanwha Q Cells reports lower revenue, swings to loss in Q2

PV module manufacturer, Hanwha Q Cells has seen its revenue decline 10.3% from $577.7 million in the second quarter of 2017, to $518.4 million in the same period of the current fiscal year.

The company blamed an overall “difficult quarter for the industry” for this revenue drop, while remaining confident that the market will rebound, and that solar will keep growing “in the long-term”. The company’s Senior Vice President of Global Sales and Marketing, Joo Yoon stressed, however, that this quarterly performance was enough to “modestly beat” its previous guidance for quarter, in which it expects to generate revenues of $490 million to $510 million.

Gross margin for the second quarter was 14%, while in the same period of 2017, it was 11.7%. Operating result, meanwhile, worsened year-on-year, from $20.1 million to $4.8 million. On the top of this, Hanwha Q Cells’ net result swung from a profit of $18.7 million in the second quarter of 2017, to a loss of $41.3 million in the latest quarter.

Total operating expenses increased 43.9% year-on-year, from $47.1 million to $67.8 million, while its available liquidity improved from $142 million at the end of June 2017, to $168.8 million as of June 30, 2018.

The company has provided no details on its quarterly shipments. It did say, however, that these are expected to improve in the second half of this year, “in spite of contraction of demand in the world's largest solar market and unfavorable trade environment.”

As for its current production capacity, Hanwha Q Cells said its in-house production capacities remained unchanged at 1.6 GW for ingots, 4.3 GW for cells and 4.3 GW for modules. The company also confirmed an additional 3.7 GW of annual module capacity from its unit Hanwha Q Cells Korea Corporation, while adding that another 1.6 GW will be added in Q1 2019 by its planned new factory in the United States.

In its outlook for full fiscal 2018, the Korean module maker confirmed that its shipments guidance, released in its Q1 financial statement, will be in the range of 5.6 GW to 5.8 GW. As for the third quarter, turnover is expected to reach between $590 million to $610 million.

Mentioning its plan to go private, Hanwha Q Cells said the offer is “still at a preliminary stage” and that it cannot provide any assurance the deal will be finalized.