China-based solar products company ReneSola Ltd. (SOL: Quote), Friday reported a swing to a loss in the first quarter, hurt mostly by sharply lower margins and revenues even as shipments grew. Loss for the quarter was much more than what analysts expected.
Moving forward, ReneSola provided its outlook for the second quarter, expecting improved module shipments and better margins to propel growth. Shares of the company are currently up 7 percent on the New York Stock Exchange.
ReneSola, which makes solar wafers and solar power products, said revenues for the quarter plunged 41 percent from the prior year. Shipments meanwhile surged 41 percent from last year to 466 megawatts, mainly on robust wafer shipments.
Gross margin for the quarter was a negative 3.8 percent, compared to a positive 28.2 percent last year. Operating margin too was negative at about 18 percent, compared to a positive 21 percent in the prior year.
"We continue to navigate what remains a challenging and substantially oversupplied global solar market by aggressively managing our costs," said CEO Xianshou Li.
"At the same time, however, we have seen steady improvement in our module sales and have built up a backlog of orders, which we are confident will continue to increase...."
ReneSola reported a first-quarter net loss to common shares of $40 million or $0.23 per share, compared to net income of $43 million or $0.24 per share last year.
On a per American Depositary Share, or ADS basis, loss for the quarter was $0.47, compared to profit of $0.49 last year. On average, 9 analysts polled by Thomson Reuters expected a loss of $0.31 per ADS for the quarter. Analysts' estimates typically exclude special items.
Revenues for the quarter were $211 million, compared to $359 million in the corresponding quarter last year.
Analysts expected revenues of $177.6 million for the quarter.
Moving forward, ReneSola expects second-quarter revenues of $200 million to $220 million, with positive gross margins. Analysts currently expect revenue of $175.60 million.
ReneSola expects second-quarter solar wafer and module shipments of 460 MW to 480 MW.
The company said it continues to expect full-year 2012 solar wafer and module shipments of 1.8 GW to 2.0 GW.
SOL is trading at $1.92, up $0.13 or 7.26%, on the NYSE.
by RTT Staff Writer
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