January 3 (Renewables Now) - China's GCL-Poly Energy Holdings Ltd (HKG:3800) has agreed to sell its wafer unit Suzhou Kezhun Photovoltaic Technologies Co for CNY 850 million (USD 123.9m/EUR 109.2m) as it aims to focus on wafer production using diamond-wire sawing technology and switch to low-cost production locations.
The polysilicon and wafer maker said in a bourse filing it will sell the subsidiary to Liaoning Huajun Asset Management Co Ltd in a move that will help it maintain production capacity with fewer wafer manufacturing facilities, thus boosting its profitability. The cost-cutting plan will also be supported by a relocation of some manufacturing activities from high-cost locations, such as the one of Suzhou Kezhun, to low-cost ones.
GCL-Poly explained that the use of diamond-wire sawing technology has already enabled it to maintain its production capacity while operating fewer manufacturing bases. The company completed an upgrade to the more efficient diamond-wire sawing technology for polysilicon wafer production at the end of 2017.
Currently, GCL-Poly is building a 60,000-tonne polysilicon plant in the Xinjiang Uyghur autonomous region and has launched trial production at the facility. The cost of electricity is low in that reagion and the company expects the factory to become “the world’s leading low-cost, high-quality polysilicon production base.”
The Chinese firm expects improved profitability in 2019 thanks to the above-mentioned moves and also with the help of the planned launch of production of “mono-like wafer with higher cost-performance value” next year.
GCL-Poly warned its consolidated loss attributable to owners of the company amounted to CNY 534 million in the first 10 month of 2018. Its full-year operating results are seen to be “substantially” lower than those of 2017. The Chinese firm said its operating performance in the past year suffered from a drop in wafer selling prices, higher finance costs and an exchange loss. It expects to publish its financial report for 2018 in March 2019. The loss will be partly compensated by a CNY-446-million gain from the Suzhou Kezhun sale.
(CNY 1.0 = USD 0.146/EUR 0.128)