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6 August 2014

First Solar’s Q2 sales up 4.6% year-on-year, despite 43% dip from Q1

For second-quarter 2014, First Solar Inc of Tempe, AZ, USA - which makes thin-film photovoltaic modules based on cadmium telluride (CdTe) as well as providing engineering, procurement & construction (EPC) services - has reported net sales of $544m, up 4.6% on $520m a year ago but down 43% on $950m last quarter, due mainly to achieving revenue recognition on the Campo Verde project in Q1 followed by project delays in Q2 that resulted in the deferral of some revenue recognition to second-half 2014.

Fiscal Q2/2013 Q3/2013 Q4/2013 Q1/2014 Q2/2014
Revenue $520m $1266m $768m $950m $544m

Operating expenses have fallen from $101m a year ago and $97.4m last quarter to $90.8m, due to R&D expenses falling back from the spike of $38.8m last quarter to $32.6m, and selling, general & administrative (SG&A) expenses falling from $58.7m last quarter to $57.7m.

However, the reduction in operating expenses has only partially offset the effect of the Campo Verde project sale in Q1 being followed by project delays in Q2. Operating income has hence fallen from $139.3m last quarter to just $1.9m. GAAP net income has fallen from $112m ($1.10 per fully diluted share) last quarter to $4.5m ($0.04 per fully diluted share).

Cash flow from operations was $118m. However, during the quarter, cash and marketable securities fell by $30m to $1.3bn. Net cash remains $1.2bn.

“While project delays in Q2 resulted in deferring some earnings to later in the year, we remain on track to our financial targets for the year,” says CEO Jim Hughes. Since Q1, First Solar has received 812MWDC of new bookings, bringing year-to-date bookings to 1216MWDC. First Solar has hence reaffirmed its full year 2014 guidance for earnings per share of $2.40-2.80 and operating cash flow of $300-500m (these had been raised from $2.20-2.60 and $250-450m, respectively, after Q1’s better-than-expected results). However, the firm notes that this guidance is highly dependent on factors such as the construction progress and sales process related to certain utility-scale power plants. Any changes in expected timing of these activities would defer earnings and operating cash flow to subsequent fiscal periods and result in a substantial impact on these guidance targets.

“I am proud of the execution by the organization, as demonstrated by a new record cell efficiency and new bookings of over 800MWDC,” notes Hughes. First Solar has raised the record for thin-film PV cell efficiency from 20.4% (set by the firm in February) to 21.0%, which now exceeds the records for both multi-crystalline silicon and copper indium gallium diselenide (CIGS) thin-film technologies.

See related items:

First Solar fabricates record 21.0%-efficient thin-film PV cell

First Solar's sales rise 24% in Q1 to $950m

First Solar's sales fall 28% year-on-year to $768m in Q4

First Solar raises CdTe solar cell efficiency record to 20.4%, matching multi-crystalline silicon record

First Solar’s sales fall 31% to $520m in Q2

Tags: First Solar Thin-film photovoltaic CdTe

Visit: www.firstsolar.com

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