Subsidy windfall helps GCL Poly eat into debt mountain

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A drop in the ocean it may be, but poly maker and solar developer GCL Poly announced some progress in paying off its debt mountain this afternoon.

In an update to the Hong Kong stock exchange, GCL announced it has banked RMB990 million ($143m) of the RMB3.05 billion it says it is owed in subsidies from the Chinese authorities.

The payments are connected to the 1.77 GW PV plant portfolio of its acquired downstream business GNE, a unit that was a golden goose during China’s PV boom years but which is now dragging heavily on its parent group’s balance sheet, according to GCL’s 2018 first-half update.

Not surprisingly, the GCL board has announced its intention to use the subsidy windfall to nibble into a debt pile that, at the end of June, it said stood at RMB61.3bn, with 21.4bn due to be settled in July.

Today’s stock market update added, GCL shareholders will be kept updated on the progress made in banking the outstanding RMB2.04bn it says it is owed in subsidies – an income stream that has been halted for future PV developments, after Beijing abruptly curtailed its subsidy program at the end of May.