Hanwha SolarOne Reports 3Q 2012 Results

Hanwha SolarOne Co., Ltd., a vertically integrated manufacturer of silicon ingots, wafers and photovoltaic (PV) cells and modules in China, reported its unaudited financial results for the quarter ended Sept. 30, 2012.

“In spite of a difficult operating environment, we achieved some good progress in shipment and production costs during the third quarter even though we suffered from continued ASP (average selling price) decline,” said Ki-Joon Hong, chairman and CEO of Hanwha SolarOne. “Our shipment volumes grew nicely quarter-to-quarter, our production costs continued to decline and now are reaching our year-end target, and we are increasingly seeing synergies with our parent company, particularly in downstream activities. We also anticipate opportunities resulting from the cooperation with Q CELLS, which was recently acquired by our parent company. We remain optimistic that our presence in large new growth markets such as China, Japan and the U.S., will provide incremental volume potential in 2013.

“Challenging industry conditions remain: overcapacity, a spike in manufacturer’s inventories, declining prices, and regulatory issues pertaining to duties in the U.S. and possibly Europe.” Mr. Hong added. “In spite of these, we continue to move forward with our long-term goals, in concert with support from our largest shareholder. We believe we have established the brand, a competitive cost structure, balance sheet and a management team to enter the next growth stage of the industry.”

Among the highlights are.
• Total net revenues were RMB966.1 million (US$153.7 million), a decrease of 9.9% from 2Q12, and a decrease of 32.8% from 3Q11.
• PV module shipments, including module processing services, were 239.5 MW, an increase of 3.8% from 230.7 MW in 2Q12, and an increase of 19.2% from 200.9 MW in 3Q11.
• Average selling price (ASP), excluding module processing services, decreased to RMB4.22 per watt (US$0.67) from RMB4.85 per watt in 2Q12, and decreased from RMB7.86 per watt in 3Q11.
• Gross loss was RMB56.1 million (US$8.9 million), compared with gross profit of RMB67.5 million in 2Q12 and, gross loss of RMB155.2 million in 3Q11.
• Operating loss increased to RMB251.2 million (US$40.0 million) from an operating loss of RMB82.8 million in 2Q12. The Company recorded an operating loss of RMB327.8 million in 3Q11. The increase in operating loss in 3Q12 from 2Q12 was primarily due to further declined ASP and an increased operating expense such as freight.