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ReneSola (SOL) Posts Q1 Earnings, Offers Q2 Sales Outlook
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ReneSola Ltd. (SOL - Free Report) reported earnings of 6 cents per American Depositary Share (“ADS”) in the first quarter of 2016. The Zacks Consensus Estimate was a loss of 4 cents.
The company has made significant progress in transforming itself from a solar product manufacturer to a multi-faceted participant across the green energy value chain. Moreover, it has reduced its debt level.
Revenues
ReneSola’s first-quarter net revenue of $260.7 million was almost in line with the Zacks Consensus Estimate of $260 million. Reported revenues, however, tanked 25.3% year over year and 12% sequentially.
The company attributes the decline to lower module shipments to external customers, and reduced module average selling prices (ASP) as it has strategically directed more shipments toward downstream projects.
Shipments
In the quarter under review, total module shipments were 350.7 megawatts (MW), down 6% sequentially. Wafer shipments totaled 351.0 MW, up 79.9% year over year and 29.8% sequentially.
Operational Highlights of the Quarter
Gross margin of 17.1% in the quarter expanded from 10.5% a year ago and 16.0% in the preceding quarter.
Operating expenses decreased 13.2% from the prior-year quarter but were up 10.3% from the preceding quarter to $32.3 million.
Operating income during the quarter was $12.2 million, lower than operating income of $16.9 million in fourth-quarter 2015. Nevertheless, the figure was a reversal from operating loss of $9.5 million reported in the year-ago period.
Financial Condition
As of Mar 31, 2016, ReneSola had cash and cash equivalents plus restricted cash of $190 million, compared with $178.4 million as of Dec 31, 2015.
Net cash outflow from operating activities in the first quarter was $4.4 million, compared to an outflow of $9.0 million in the year-ago period.
Long-term borrowings were $1.6 million at the end of first-quarter 2016, compared with $38.8 million as of Dec 31, 2015.
Guidance
The company expects second-quarter 2016 revenues in the range of $280 million to $290 million and gross margin around 18%. For 2016, management has reaffirmed its revenue guidance in the range of $1.0 billion to $1.2 billion.
Peer Releases
SunPower Corp. (SPWR - Free Report) reported first-quarter 2016 adjusted loss of 42 cents per share, wider than the Zacks Consensus Estimate of loss of 23 cents by 82.6%. In the year-ago quarter, the company had reported earnings of 5 cents per share.
First Solar Inc. (FSLR - Free Report) reported first-quarter 2016 earnings of $1.66 a share, sweeping past the Zacks Consensus Estimate of 91 cents by 82.4%. The reported number was also a reversal from the prior-year loss of 61 cents, reflecting higher sales, gross profits, operating income and lower expenses.
SolarCity Corp. posted adjusted loss of $2.56 per share, much wider both the Zacks Consensus Estimate of a loss of $2.30 and the year-ago loss of $1.52. The wider loss can be attributed to the company’s rising expenses.
Zacks Rank
ReneSola presently carries a Zacks Rank #3 (Hold).
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ReneSola (SOL) Posts Q1 Earnings, Offers Q2 Sales Outlook
ReneSola Ltd. (SOL - Free Report) reported earnings of 6 cents per American Depositary Share (“ADS”) in the first quarter of 2016. The Zacks Consensus Estimate was a loss of 4 cents.
The company has made significant progress in transforming itself from a solar product manufacturer to a multi-faceted participant across the green energy value chain. Moreover, it has reduced its debt level.
Revenues
ReneSola’s first-quarter net revenue of $260.7 million was almost in line with the Zacks Consensus Estimate of $260 million. Reported revenues, however, tanked 25.3% year over year and 12% sequentially.
The company attributes the decline to lower module shipments to external customers, and reduced module average selling prices (ASP) as it has strategically directed more shipments toward downstream projects.
Shipments
In the quarter under review, total module shipments were 350.7 megawatts (MW), down 6% sequentially. Wafer shipments totaled 351.0 MW, up 79.9% year over year and 29.8% sequentially.
Operational Highlights of the Quarter
Gross margin of 17.1% in the quarter expanded from 10.5% a year ago and 16.0% in the preceding quarter.
Operating expenses decreased 13.2% from the prior-year quarter but were up 10.3% from the preceding quarter to $32.3 million.
Operating income during the quarter was $12.2 million, lower than operating income of $16.9 million in fourth-quarter 2015. Nevertheless, the figure was a reversal from operating loss of $9.5 million reported in the year-ago period.
Financial Condition
As of Mar 31, 2016, ReneSola had cash and cash equivalents plus restricted cash of $190 million, compared with $178.4 million as of Dec 31, 2015.
Net cash outflow from operating activities in the first quarter was $4.4 million, compared to an outflow of $9.0 million in the year-ago period.
Long-term borrowings were $1.6 million at the end of first-quarter 2016, compared with $38.8 million as of Dec 31, 2015.
Guidance
The company expects second-quarter 2016 revenues in the range of $280 million to $290 million and gross margin around 18%. For 2016, management has reaffirmed its revenue guidance in the range of $1.0 billion to $1.2 billion.
Peer Releases
SunPower Corp. (SPWR - Free Report) reported first-quarter 2016 adjusted loss of 42 cents per share, wider than the Zacks Consensus Estimate of loss of 23 cents by 82.6%. In the year-ago quarter, the company had reported earnings of 5 cents per share.
First Solar Inc. (FSLR - Free Report) reported first-quarter 2016 earnings of $1.66 a share, sweeping past the Zacks Consensus Estimate of 91 cents by 82.4%. The reported number was also a reversal from the prior-year loss of 61 cents, reflecting higher sales, gross profits, operating income and lower expenses.
SolarCity Corp. posted adjusted loss of $2.56 per share, much wider both the Zacks Consensus Estimate of a loss of $2.30 and the year-ago loss of $1.52. The wider loss can be attributed to the company’s rising expenses.
Zacks Rank
ReneSola presently carries a Zacks Rank #3 (Hold).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>