) reported loss per American Depositary Share (ADS) of 14 cents in
the first quarter of 2014, wider than the Zacks Consensus Estimate
of a loss of 5 cents per ADS. However, loss in the reported quarter
was narrower than the year-ago loss of 45 cents per ADS. The
year-over-year improvement was driven by strong shipments to Japan.
ReneSola's net revenues of $415.0 million advanced 46.0% from
$284.2 million in the prior-year quarter but decreased 5.4% from
$438.8 million in the sequentially preceding quarter. The reported
figure fell short of the Zacks Consensus Estimate of $465.0 million
The year-over-year improvement in sales was driven mainly by higher
shipment to Japan at a much higher price. In addition, the
company's continuous effort to convert more of its silicon wafers
into solar photovoltaic (PV) modules brought considerable sales
During the quarter under review, total solar wafer and module
shipments were 710.1 megawatt ("MW"), up 7.2% year over year but
down 9.5% sequentially. Its module shipments were 521.1 MW, up a
considerable 59.6% year over year and 3.1% sequentially.
Operating expenses, representing 12.7% of total revenues, jumped
77.2% year over year and 29.1% sequentially to $52.8 million during
Operating loss during the quarter was $8.7 million as compared to
an operating income of $8.8 million in the fourth quarter of 2013.
However, the quarterly loss was much narrower than the year-ago
loss of $33.4 million.
As of Mar 31, 2014, ReneSola had cash and cash equivalents plus
restricted cash of $214.9 million, compared with $348.9 million as
of Dec 31, 2013. Net cash outflow from operating activities was
$112.3 million in first quarter 2014 compared with net cash outflow
of $30.8 million in the fourth quarter of 2013. Total debt was
$723.9 million as of Mar 2014 compared with $742.6 million as of
Dec 31, 2013.
The company expects to deliver a robust second quarter on the back
of its strong sales and marketing capabilities across international
markets. In addition, its polysilicon factory was back to full
production since the end of March and is expected to contribute to
the company's overall profitability from the second quarter onward.
The company expects second quarter 2014 total solar module
shipments between 480 MW and 500 MW, with overall gross margin in
the range of 12% to 14%.
For 2014, the company maintained its solar module shipments
forecast in the range of 2.3 gigawatts (GW) to 2.5 GW.
At the Peers
JA Solar Holdings Co. Ltd.
) announced a profit of 32 cents per American Depositary Share
(ADS) in the first quarter of 2014, comfortably surpassing the
Zacks Consensus Estimate of a profit of 8 cents by 300%. The
company also swung to a profit in the reported quarter from a loss
of 85 cents per share in the year-ago period. The reported figure
was also 113.3% higher than 15 cents per ADS reported in the
Solar cell manufacturer
Canadian Solar Inc.
) reported earnings of 7 cents per share in the first quarter of
2014 as against a loss of 10 cents per share in the year-ago
quarter. The bottom line, however, was short of the Zacks Consensus
Estimate by a penny.
JinkoSolar Holding Co. Ltd.
) reported first quarter 2014 results with adjusted earnings per
American Depositary Share (ADS) of 20 cents (adjusted earnings of 5
cents per share), much lower than the Zacks Consensus Estimate of
41 cents. The company, however, reversed its year-ago adjusted loss
per ADS of 56 cents (adjusted loss of 14 cents per share) in the
reported quarter. Each "ADS" represents four ordinary shares.
ReneSola continues to emphasize its original equipment
manufacturing (OEM) strategy. It is believed that the company could
continue its operations with low capital expenditure requirements
despite the presence of regulatory uncertainties related to trading
in the major solar markets, including the U.S, India and Australia.
Its overseas OEM module capacity now surpasses 1.1 GW, with a total
of 11 facilities in Europe, Africa, South Asia, and the
The company offers varied products for the PV industry. The company
is presently manufacturing polysilicon, wafers, PV modules,
microinverters, string inverters and energy storage systems. It is
also developing a tripod mounting system. Therefore, we believe
that this diversified business portfolio will generate strong
business opportunity for the company.
ReneSola is committed to expanding its global retail market for
commercial and residential installations. It is expected that
retail market sales will reach roughly half of shipments by the end
of the year.
ReneSola presently carries a Zacks Rank #3 (Hold).
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