JA Solar lifts 2017 shipments forecast after strong Q2

Solar panels in China. Featured Image: zhu difeng/Shutterstock.com

Chinese company JA Solar Holdings Co Ltd (NASDAQ:JASO) lifted its forecast for 2017 shipments to up to 7 GW after second-quarter (Q2) solar cell and module shipments surpassed its guidance by roughly 50%.

Total shipments arrived at 2,389.2 MW, while the photovoltaics (PV) manufacturer’s forecast was for 1,550 MW to 1,650 MW. Shipments grew mainly on the back of stronger than foreseen pull-in orders from China, where demand jumped ahead of subsidy cuts. External shipments grew by 88.3% on the year and by 68.3% on the preceding quarter to 2,314.7 MW.

CEO Baofang Jin said that the strong shipments in China helped JA Solar’s revenue rise by 44.7% from the same quarter of 2016. Gross margin improved to 12.9% from 11.7% in the first quarter of 2017 due to better-than-expected average selling price (ASP) and lower blended costs.

Results in CNY million, unless specified	Q2 2017	Q1 2017	Q2 2016
Modules and module tolling (in MW)	2,147.5	1,325.1	1,134.2
Cells and cell tolling (in MW)	167.2	50.2	95.1
Net revenue	5,953	3,692	4,114
Gross margin (in %)	12.9	11.7	15.3
Operating profit	255.1	80.0	188.0
Net profit	134.6	8.1	164.1
Earnings per diluted ADS (in yuan)	2.87	0.17	2.87

In the third quarter JA Solar expects total cell and module shipments of 1,600 MW to 1,700 MW. Its upgraded full-year forecast is for total cell and module shipments of between 6.5 GW and 7.0 GW, as compared to 6.0-6.5 GW in its prior guidance. This includes 100 MW-150 MW of module shipments to own projects, down from 200 MW-250 MW in the previous guidance.

At the end of June, the company had cash and cash equivalents of CNY 3.2 billion (USD 478m/EUR 406m) and total working capital of CNY 857.2 million. Total short-term borrowings amounted to CNY 3.3 billion, while total long-term borrowings stood at CNY 2.8 billion.

(CNY 10 = USD 1.49/EUR 1.27)

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