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First Solar Slips To Loss, Cuts Sales Outlook; Stock Down

First Solar Slips To Loss, Cuts Sales Outlook; Stock Down
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2/28/2012 6:14 PM ET

First Solar Inc. (FSLR: Quote) Tuesday said it slipped to a loss in the fourth quarter, hurt mainly by the lower-than-expected sales of solar modules and hefty one-time charges. The company also trimmed its revenue outlook for the full year 2012, indicating that tough market conditions continue to prevail.

The news rattled investor sentiments, dragging down First Solar shares by 5.5 percent in after hours trade on the Nasdaq.

Commenting on the lackluster results, CEO Mike Ahearn said stiff competition, an uncertain regulatory environment, and restructuring and other charges pulled the company into the red. Ahearn said efforts were on to curb costs, enhance module efficiency, which along with recent restructuring activities is expected to help it wade through the tough times.

First solar, which makes thin film photovoltaic modules, has been battling hostile market conditions for some time. Last December, the company's stock sank after it slashed its 2011 outlook, citing delays of certain projects in its systems business.

Tempe, Arizona-based First Solar reported a fourth-quarter net loss of $413 million or $4.78 per share, compared to net income of $156 million or $1.80 per share last year.

Results for the quarter include pre-tax goodwill charges of $393 million, $164 million in warranty-related costs, and $60 million restructuring charges.

Excluding items, adjusted earnings were $110 million or $1.26 per share, compared to $163 million or $1.88 per share last year.

On average, 29 analysts polled by Thomson Reuters expected the company to earn $1.54 per share for the quarter. Analysts' estimates typically exclude special items.

Net sales for the quarter rose to $660 million from $610 million in the prior year. Thirty four analysts had a consensus revenue estimate of $781.55 million.

First Solar continues to expect full year 2012 earnings in the range of $3.75 to $4.25 per share, excluding any impairment and restructuring charges.

The company now expects 2012 net sales between $3.5 billion and $3.8 billion, compared to its prior estimate of $3.7 billion to $4 billion. Analysts currently expect $3.77 billion for the year.

FSLR closed Tuesday at $36.40, up $0.27 or 0.95%, on a volume of 5.9 million shares on the Nasdaq. In after hours, the stock dropped $1.72 or 4.73%.

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by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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