1 March 2012

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

For full-year 2011, First Solar Inc of Tempe, AZ, USA, which manufactures thin-film photovoltaic modules based on cadmium telluride (CdTe) as well as providing engineering, procurement and construction (EPC) services, has reported net sales of $2.76bn, up about 8% on 2010’s $2.56bn.

First Solar had previously cut its guidance for 2011 sales several times, from $3.7–3.9bn (given in December 2010) to $3.7–3.8bn (in late February) then $3.6–3.7bn (in August), $3.0-3.3bn (at the end of October), and finally $2.8-2.9bn (in mid-December).

On a non-GAAP basis, net income has fallen from $695m ($8.04 per fully diluted share) in 2010 to $523.6m ($6.01 per fully diluted share).

Most recently, for fourth-quarter 2011, net sales were $660m, up 8% on $610m a year ago but down 34% on $1006m in Q3/2011, due mainly to the timing of revenue recognition in the systems business and lower volume for module-only sales. Net income was $110m ($1.26 per fully diluted share), down from $196.5m ($2.25 per diluted share) in Q3 and $163.1m ($1.88 per fully diluted share) a year ago. During the quarter, cash and marketable securities fell from $795m to $788m.

“First Solar’s performance in the quarter was impacted by an aggressive competitive environment, an uncertain regulatory environment, warranty-related charges, and restructuring costs incurred to help position our business for the future,” says chairman & interim CEO Mike Ahearn. “Despite these headwinds, we continue to make strides reducing manufacturing costs, increasing module efficiency, and successfully building out our captive project pipeline,” he adds. “These improvements, combined with our recent restructuring and strategic repositioning, enhance our competitive position in a very challenging environment.”

First Solar set record solar energy conversion efficiencies for CdTe-based solar cell and module of 17.3% and 13.4%, respectively, as certified by US Department of Energy’s National Renewable Energy Labs (NREL). (This January, First Solar raised its record module efficiency record further, to 14.4%, using commercial-scale equipment and materials.) Compared with fourth-quarter 2010, the firm also increased its average module efficiency by 0.6 percentage points to 12.2%, and reduced its average module manufacturing cost by $0.02 per watt to $0.73 per watt.

As well as announcing or completing the sale of four of the world’s largest solar projects under construction (Agua Caliente, Desert Sunlight, Antelope Valley Solar Ranch One, and Topaz), and this January energizing the first 30MW block of the Agua Caliente project, during 2011 First Solar added about 650MW AC of new projects to its project pipeline (which grew to 2.7GW AC). Cumulative production surpassed 5GW (enough to provide electricity for about 2.5 million homes and displace 3.3 million metric tons of CO2 annually).

Nevertheless, First Solar has lowered its 2012 net sales guidance (given in mid-December) from $3.7-4bn (up 37.5% on 2011) to $3.5-3.8bn (up 30% on 2011). It has also cut its guidance for operating cash flow from $0.9-1.1bn to $0.8-$0.9bn. However, the firm has reiterated its guidance for earnings per fully diluted share of $3.75-4.25 (excluding any impairment and restructuring charges).

See related items:

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

First Solar’s Q2 sales fall 6% to $533m

First Solar’s sales drop 7% in Q1; 2011 guidance cut

First Solar grows revenue 24% in 2010, despite drop off in Q4

First Solar’s sales rise 36% in Q3 to $798m

Tags: First Solar Thin-film photovoltaic CdTe

Visit: www.firstsolar.com