Solar cells and modules maker Canadian Solar Inc. (CSIQ) reported Tuesday an increase in third-quarter profit, despite a drop in revenues, helped by higher market demand and an exchange gain for the period, compared to a heavy exchange loss recorded last year. The company confirmed its shipment guidance for the fourth quarter and expects to shipments to double in 2010 compared to current projections for the full year 2009.
For the third quarter, net income attributable to Canadian Solar rose to US$ 25.34 million or US$ 0.69 per share from US$ 11.06 million or US$ 0.31 per share in the previous year.
The results of the latest quarter included exchange gain of US$9.66 million, compared to loss of US$17.29 million in the past year. Loss on foreign currency derivatives was US$ 1.38 million, compared to gain of US$ 7.42 million in the year-ago quarter.
On average, nine analysts polled by Thomson Reuters expected the company to report earnings of US$ 0.54 per share in the third quarter. Analysts' estimates typically exclude special items.
Net revenues for the quarter declined to US$ 213.13 million from US$ 252.36 million. Eight analysts were expecting revenue of US$ 210.92 million in the third quarter.
Shipments surged to 102.6 MW from 60 MW for the three-month period in fiscal 2008.
Selling expenses increased year-over-year to $6.56 million from $3.48 million.
For the nine-month period, net income dipped to US$ 38.23 million or US$ 1.06 per share from US$ 41.71 million or US$ 1.34 per share in fiscal 2008. Revenues declined to US$ 376.77 million from US$ 636.18 million in the same period last year.
Looking ahead, Arthur Chien, finance chief of Canadian Solar, said, "We expect the expansion of our internal cell facility in H1 2010 will help us to further offset ongoing industry pricing pressure, while at the same time increasing our manufacturing process control."
For the fourth quarter of 2009, the company reiterated its shipments guidance of 128 MW - 138 MW, and expects gross margin to be in the high- teens on a percentage basis. For the full year, the company currently sees shipments of about 295 MW - 305 MW. For fiscal 2010, Canadian Solar foresees shipments to range between 600 MW and 700 MW.
Commenting on the shipment outlook for 2010, Shawn Qu, chief executive, said, "We expect to more than double our shipments in 2010 and are preparing our capacity expansion accordingly. This rapid growth is driven by our sales strategy of combining a superior product with attractive pricing and value added services."
CSIQ closed Monday's regular trading hours at $19.70 on the NASDAQ.
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