Yingli forecasts lower shipments, negative margins as prices slump

Fri Nov 16, 2012 6:15am EST

Nov 16 (Reuters) - Yingli Green Energy Holding Co, one of China's largest solar equipment makers, forecast lower shipments and a negative gross margin f o r the third quarter, citing U.S. anti-dumping duties and low prices.

The company, however, said it expects to reverse a $13.7 million provision it took in the first quarter in relation to U.S. countervailing and anti-dumping duties.

The United States last week gave final approval to duties on billions of dollars of solar equipment imports from China, compounding problems for companies who are already battling a sharp fall in prices which has virtually erased margins.

The U.S. International Trade Commission, however, rejected a Commerce Department finding which would have made the duties retroactive to 90 days.

Yingli Green Energy said this decision enabled it to scrap the provision it had on its books.

Trina Solar also reversed a $26.2 million provision for anti-dumping and countervailing duties last week.

Yingli's gross margins are estimated to be in the range of negative 22 percent to 24 percent in the third quarter, lower than a positive 4.6 percent in the second quarter.

The company said it expects to recognize non-cash charges related to inventory and underutilized capacity in the third quarter.

Excluding the impact of the charges, Yingli said its module gross margin would be in the range of breakeven to 1 percent.

Third-quarter module shipments will decrease 17 percent from the preceding quarter, Yingli said.

Yingli shares, which have lost nearly two-thirds of their value this year, closed at $1.44 on Thursday on the New York Stock Exchange.

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