Shunfeng of China's profit drops 66% in H1 2015

China-based Shunfeng International Clean Energy Ltd (HKG:1165) said Friday its net profit for the first half of 2015 has fallen by 65.8% year-on-year to CNY 172.5 million (USD 27m/EUR 24m) due to low prices and growing costs.

The result is in line with the firm’s forecast for at least 50% lower profits. The company, previously known as Shunfeng Photovoltaic International, explained that the decline in its bottom line can be mainly attributed to a 15.8% year-on-year decrease in January-June average selling prices (ASPs) for photovoltaic (PV) products. Significantly higher costs also hurt Shunfeng’s first-half performance.

The lower ASPs offset the good results of Shunfeng’s solar products manufacturing business, in which sales grew by 19.6% on the year to 1,193.4 MW. The company’s electricity generation division also registered 216.9% higher revenues, as the combined output of its 1,622 MW of solar parks grew by 176% to 512,751 MWh as compared to the first six months of 2014.

Shunfeng saw its total revenue in January-June 2015 jump by 19.5% year-on-year to CNY 3.52 billion. The biggest portion of it came from its solar module manufacturing and trading operations, where sales reached CNY 1.74 billion, as compared to CNY 1.48 billion in 2014. In particular, the firm shipped 548.7 MW of PV modules to third parties in the reporting period.

Shunfeng, the parent of Wuxi Suntech, is a fully-integrated solar company, which operates in both the upstream and downstream solar segments. “We have a strong pipeline of projects where we will integrate multiple clean energy technologies – such as solar, LED, ground source heat pumps, storage and monitoring – to help our customers reduce energy consumption by 50% to 70%,” chairman Zhang Yi noted.

(CNY 1.0 = USD 0.157/EUR 0.139)

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