Renesola's Prospects Remain Cloudy Despite A Well Executed 2011 Fiscal Year
By Investing Hobo: Despite surpassing shipment guidance of 280-300MW with actual fourth quarter shipments of 339.9MW, Renesola's operational results fell well below my estimates, which called for a $9m gross profit. Instead of positive gross margins, SOL reported an adjusted gross loss of $17.2m, which excludes the $26.2m inventory provision taken during the quarter. With Q4 revenues of $187.7m, the company surprisingly posted a rather large adjusted negative gross margin of -9.2%. This was a dramatic reversal of adjusted gross margin of 6.2% during the third quarter.Based on statements made during the company's third quarter earnings conference call, Renesola should not have posted negative gross margin in the fourth quarter. With gross margin being an obvious relationship between costs and selling prices, the result should not have been a surprise given the amount of information SOL's management provided. On the pricing side, Renesola's Q4 silicon wafer and solar module ASPs were $0.36/wattComplete Story »
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