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2 November 2012

First Solar reports Q3 sales down 12% to $839m

For third-quarter 2012, First Solar Inc of Tempe, AZ, USA – which manufactures thin-film photovoltaic modules based on cadmium telluride (CdTe) as well as providing engineering, procurement & construction (EPC) services – has reported net sales of $839m, down 12.3% on $957m last quarter and down 16.6% on $1006m a year ago.

Fiscal Q3/2011 Q4/2011 Q1/2012 Q2/2012 Q3/2012
Revenue $1006m $660m $497m $957m $839m

The drop from last quarter was due mainly to project-specific decreases including Silver State North (completed in the second quarter) and reduced construction activity at Agua Caliente (consistent with the planned construction schedule). This was partially offset by initial revenue recognition for the 550MWac Topaz Solar Farms project (which began construction in late 2011).

“Despite continued uncertainties and over-supply conditions in the market, First Solar delivered another strong quarterly performance,” says CEO Jim Hughes.

Net income was $87.9m ($1.00 per fully diluted share), down from $111m ($1.27 per fully diluted share) last quarter and $196.5m ($2.25 per fully diluted share) a year ago. However, this includes a charge of $23.6m (reducing EPS by $0.27) relating to restructuring actions announced in mid-April (involving closing manufacturing operations in Frankfurt (Oder), Germany in Q4/2012 and, since May, indefinitely idling four production lines at its manufacturing center in Kulim, Malaysia, collectively cutting the firm’s global staffing by about 2000, or 30%). Excluding such charges, non-GAAP net income was $111.5m ($1.27 per fully diluted share), down from $144.9m ($1.65 per fully diluted share) last quarter.

During the quarter, cash and marketable securities fell slightly from $744m to $717m.

First Solar also updated its guidance for full-year 2012 as follows:

  • Net sales of $3.5-3.8bn, down from prior guidance of $3.6-3.9bn due to weather-related disruptions in the supply chain and at certain project sites that may push the expected closing of the project sales from Q4/2012 into Q1/2013. Nevertheless, this is still up 32% on 2011’s $2.76bn.
  • Non-GAAP earnings per fully diluted share of $4.40-4.70, compared to prior guidance of $4.20-4.70. This excludes restructuring and impairment charges and certain costs in excess of normal warranty expense related to the previously announced manufacturing excursion that is expected, which should reduce earnings per fully diluted share by $6.00. On a GAAP basis, earnings per fully diluted share are expected to be $1.60-1.30.
  • Operating cash flows of $650-850m, down from prior guidance of $850-950m, due mainly to the weather-related disruptions for certain projects.

“Our quarterly performance, coupled with our recent project wins in sustainable markets, demonstrates we are making meaningful progress in achieving our strategic plan for long-term growth,” says Hughes.

See related items:

First Solar sales almost double to $957m in Q2 as projects reach revenue recognition

First Solar’s revenue falls 25% in Q1 to $497m

First Solar to close German manufacturing facility and idle four lines in Malaysia

First Solar’s sales fall 34% in Q4/2011, limiting full-year growth to 8%

First Solar’s sales rise 89% in Q3 to $1bn

Tags: First Solar Thin-film photovoltaic CdTe


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