Renesola warns of Covid-19 project disruption

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U.S.-based solar developer Renesola has warned shareholders of Covid-19-related delays of “several months” at project sites which are suffering supply chain disruption.

However the developer, which has its roots in China but shifted to a new headquarters in Stamford, Connecticut last year, insisted it was weathering the coronavirus storm with work at projects which already have all their components proceeding as planned. The company also made the surprise claim in Friday’s first-quarter update that none of its global workforce has yet tested positive for Covid-19.

The company touted a 62% rise in revenue to $21.2 million from the first three months of last year, for gross profit of $1.4 million. Subtract the operating expenses, though, and that added up to a first-quarter loss of $4.68 million.

Renesola was understandably keen to highlight the diversified nature of its solar project business, by market and scale, but the balance sheet once again provided a sobering note.

The bottom line

The business had cash and equivalents of $15.5 million at the end of March, versus short-term borrowings of $33.5 million – which may or may not have included a $28.8 million loan which pv magazine has previously highlighted which was due to fall for repayment in March. That debt figure could explain why, having sold off projects in Canada and Hungary – albeit with the latter transaction slipping into April thanks to Covid-19 – Renesola is still trying to sell off 600 kW of micro systems in the latter nation.

Longer-term borrowings of $8.5 million might indicate a light at the end of the tunnel if the company can negotiate its more immediate financial liabilities. They might, that is, but for a huge $44 million long-term liability for failed sale-and-leaseback and finance leases related to the company’s rooftop solar business in China.

In outlook terms, Renesola said it expects revenue of $22-25 million in the current quarter, for a full year return of $80-100 million, on the back of second-quarter gross margin of 17-20% and an annual figure of 18-20%.