UPDATE 1-ReneSola posts bigger-than-expected loss as panel prices slip

Thu May 16, 2013 1:18pm EDT

* First-quarter loss $0.45/ADS vs est. loss $0.28/ADS

* Panel price falls 2 cents to 61 cents per watt

* Shares down 11 percent

May 16 (Reuters) - ReneSola Ltd, a Chinese solar wafer and panel maker, reported a bigger-than-expected quarterly loss as it sold fewer solar wafers in the first quarter and selling prices fell, sending the company's shares down nearly 11 percent.

ReneSola, like most of its Chinese peers, has reported a loss for seven straight quarters as selling prices for panels have remained depressed.

ReneSola said panel prices had slipped by 2 cents to 61 cents per watt during the first quarter compared to the fourth quarter. Total wafer and panel shipments fell by 7 percent during the period.

The fall in prices and shipments sent gross margin into negative territory in the quarter. Margin fell to negative 2 percent from positive 3.3 percent in the fourth quarter.

First-quarter net loss was $39 million, or 45 cents per American Depositary Share (ADS). Analysts on average had estimated a loss of 28 cents per ADS, according to Thomson Reuters I/B/E/S.

First-quarter revenue was $284.2 million.

Lower funding for solar subsidies in top market Europe, coupled with rapid expansion in Chinese manufacturing capacity, has sent panel prices into a tailspin in the last two years.

U.S.-listed ReneSola, however, expects panel prices to inch up 2 to 3 cents per watt in the current quarter, and rise further to 65 cents per watt in the third quarter.

The company also expects shipments to rise in the current quarter. It expects wafer and module shipments to increase to 700 to 720 megawatts (MW) in the second quarter from 662.1 MW in the first.

Second-quarter revenue is forecast to be in the range of $310 million to $330 million, higher than the average analyst estimate of $296.5 million.

The company also expects gross margins to turn positive in the second quarter at between 3 percent and 5 percent.

ReneSola is one of the few Chinese solar companies to escape steep U.S. import duties on solar products that use China-made cells. The company sources its cells from outside China.

It will employ a similar strategy to bypass recently imposed EU tariffs on Chinese solar panel imports, the management said on a conference call with analysts. Europe accounted for about 50 percent of the company's first-quarter shipments.

ReneSola plans to outsource 700-900 MW of production to locations like South Africa and Poland this year.

The company also said shipments in the second half of the year would average more than 700 MW per quarter, helping it reach the target of shipping 2.7 to 2.9 gigawatts (GW) this year.

The company's sunny outlook for the latter part of the year failed to assuage investors ReneSola shares were down nearly 11 percent at $1.96 at midday on the New York Stock Exchange.

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