Evergreen Solar's Wider Loss

Evergreen Solar, Inc. (ESLR - Analyst Report) announced financial results for its 1st quarter ended April 4, 2009.

Revenue for the reported 1st quarter of 2009 was $55.8 million, up 26% from $44.2 million in the sequential 4th quarter of 2008, and up 144% from $22.9 million in the year-ago 1st quarter of 2008.

Gross margin during the 1st quarter of 2009 was 1.2%, down compared to 4.6% for the 4th quarter of 2008 and 33.6% for the 1st quarter of 2008. The decreased gross margin from last year was due to lower average selling prices and lower fees from Sovello.

The net loss for the 1st quarter of 2009 was $64.3 million, or –$0.40 per share, including charges of $43.9 million for the write-off of a loan receivable and related interest from a future silicon supplier, $3.5 million of facility start-up costs for the second phase of Devens and Midland string factory, and $1.8 million of on-going costs associated with the closure of the Marlboro pilot facility.

The comparable net loss for the sequential 4th quarter of 2008 was $52.1 million, or –$0.32 per share, including charges of $23.1 million for the closure of the Marlboro pilot facility, $9.7 million of facility start-up costs for Devens and Midland and $8.0 million for the write-off of certain research and development equipment. By comparison, the net loss for the comparable 1st quarter of 2008 was $25,000.

For the first quarter of 2009, Evergreen Solar produced 18.2 MW, more than double the 8.5 MW produced during the sequential 4th quarter of 2008. The company sold 17.3 MW at an average selling price of $3.13 per watt compared to $3.39 per watt during the 4th quarter of 2008.

Management projected that although Evergreen Solar may still meet its 2nd quarter 2009 production goal of approximately 30 MW, softness in demand due to tight credit markets and uncertain economic conditions will likely result in production and sales volume of 20 MW to 25 MW.

The capacity expansion of the company's Devens facility apparently remains on the original schedule that established in the summer of 2007. The company still expects to have the capacity to produce approximately 40 MW per quarter at Devens by year-end 2009 and to achieve target manufacturing costs of approximately $2 per watt at that production level.