Delayed project sales push ReneSola into Q2 loss

Solar panels. Featured Image: pornvit_v/Shutterstock.com

Solar project developer and operator ReneSola Ltd (NYSE:SOL) swung to a second-quarter GAAP net loss of USD 204,000 (EUR 204,049) as revenues tumbled 55.7% on the year, mostly due to delayed project sales in the US.

The reported results for the trimester were lower than the company’s guidance, it said on Wednesday.

Coming at USD 8.2 million, ReneSola’s revenue was mostly brought by its independent power producer (IPP) projects in China and the sale of three shovel-ready schemes in the US. Around 72% of the total revenues came from the IPP business, whereas project development activities accounted for 25%. On a sequential basis, the top line surged by 134%.

GAAP gross profit stood at USD 3.7 million and represented 45% of revenue.

Regardless of the inferior results, ReneSola said it is optimistic about its growth opportunities in view of the favourable regulatory conditions in the US and Europe, which are its two largest markets.

More details about ReneSola’s performance in the reporting period can be seen in the table.

Amounts in USD millions	Q2 2022	Q1 2022	Q2 2021
Revenue	8.2	3.5	18.5
GAAP gross profit	3.7	1.1	11.3
Non-GAAP operating profit (loss)	0.8	(1.4)	8.8
Adjusted EBITDA	2.3	0.6	10
Net profit (loss) attr. to ReneSola	(0.2)	(1.7)	7
Non-GAAP net profit (loss) attr. to ReneSola	(0.4)	(1)	7.5

At the end of June, ReneSola had a mid-to-late stage pipeline of projects with a combined capacity of 2.4 GW, half of which are located in the US and Poland. The total is set to reach almost 3 GW at end-2022 as energy demand increases and is aimed to be 5 GW by the end of 2024.

Looking ahead, the company expects project sales in the second half of 2022 to gain speed and confirmed its outlook for full-year revenue of between USD 100 million and USD 120 million. Gross margin is still seen at between 20% and 25%, while net profit is anticipated to be within the USD 9 million-10 million range.

Revenues in the third quarter are forecast to range between USD 22 million and USD 25 million, with a gross margin at 20%-24%.

(USD 1.0 = EUR 1.000)

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