| Yingli Green Incurs Wider-than-Expected Q2 Loss, Cuts View | |
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Solar panel manufacturer Yingli Green Energy Holding Company Limited YGE, or Yingli Solar, reported an operating loss of 53 cents per American Depository Share (“ADS”) in second-quarter 2015, much wider than the Zacks Consensus Estimate of a loss of 21 cents. Reported loss was also wider than the 25 cents per ADS loss incurred a year ago.
Revenues
Total revenues of $438.1 million declined 20.3% from $529.5 million in second-quarter 2014. The downside was mainly due to lower PV module shipments.
Yingli Solar’s revenues also missed the Zacks Consensus Estimate of $501 million.
Highlights of the Release
Gross margin in the reported quarter contracted 930 basis points year over year to 6.3% due to a decline in average selling price of PV modules and an increase in unit manufacturing cost on lower utilization of production facilities.
Operating expenses declined to $56.3 million from $99.6 million in the second quarter of 2014.
Operating loss in the second quarter of 2015 was $28.8 million, wider than the operating loss of $13.9 million in the year-ago quarter.
Interest expenses were $39.1 million in the reported quarter, compared with $37.5 million in the year-ago period.
Financial Highlights
The company had cash & cash equivalents of $92.7 million as of Jun 30, 2015 compared with $387 million as of Dec 31, 2014.
Long-term debt excluding current portion was $332.9 million as of Jun 30, 2015, down from $460.7 million as of Dec 31, 2014.
Guidance
For the third quarter, Yingli Green expects PV module shipments in the range of 550–580 MW. For 2015, the company has revised the PV shipment guidance to 2.5–2.8 gigawatts (“GW”), down from the earlier projection of approximately 3.6 GW.
Other Solar Company Releases
ReneSola Ltd. SOL reported an adjusted loss of 2 cents per ADS in the second quarter of 2015, narrower than the Zacks Consensus Estimate of a loss of 17 cents.
Trina Solar Ltd TSL reported earnings of 42 cents per ADS in the second quarter of 2015, beating the Zacks Consensus Estimate of 24 cents by 75%.
JinkoSolar Holding Co. JKS reported second-quarter non-GAAP adjusted earnings of $1.04 per ADS in the second quarter of 2015, beating the Zacks Consensus Estimate of 83 cents by 25.3%.
Our View
Yingli Solar, one of the world’s leading solar panel manufacturers, has been struggling to survive amid a pile of debt. Importantly, the company has failed to generate profits since 2011. In this scenario, the company may find it difficult, if not impossible, to pay down its outstanding debt, thereby resulting in cross-defaults, putting it at liquidation risk.
The company recently received a notice from NYSE about its non-compliance with the stock exchange’s price criteria for continued listing standard.
Substantial indebtedness along with the company’s inability to report in the green for the past few quarters signals more trouble ahead for the company. Moreover, the pressure on margins is definitely a concern.
Yingli Solar currently has a Zacks Rank #3 (Hold).
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Yingli Green Energy Holding Co. Ltd.
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CODE : YGE |
ISIN : US98584B1035 |
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ProfileMarket IndicatorsVALUE : Projects & res.Press releasesAnnual reportRISK : Asset profileContact Cpy |
Yingli Green is based in China. Yingli Green is listed in Germany and in United States of America. Its market capitalisation is US$ 261.7 millions as of today (€ 224.0 millions). Its stock quote reached its highest recent level on May 15, 2009 at US$ 9.62, and its lowest recent point on November 30, 2012 at US$ 1.25. Yingli Green has 181 764 000 shares outstanding. |