UPDATE 3-UK's PV Crystalox H1 results defy solar gloom
* H1 sales better than expected at 121.6 mln euros
* Shipments picked up in June, deferrals less than feared
* Sees average prices lower in H2 than in H1
* Shares up almost 3 percent, among FTSE 250 top gainers
(Recasts, adds CEO, analyst comment)
LONDON, Aug 19 (Reuters) - Britain's PV Crystalox Solar (PVCS.L) posted better than forecast first-half sales and said it had seen some improvements in demand, a week after a raft of disappointing results from rival U.S and German solar firms.
PV Crystalox, which makes silicon wafers for major solar cell makers such as SunTech Power (STP.N), on Wednesday reported sales down 3.7 percent at 121.6 million euros ($171.9 million) and maintained its dividend at 2 euro cents per share.
It had said in May that first-half sales would be 10 percent lower than the 126 million euros it achieved in the same period in 2008 because of customer deferrals, prompting analysts to cut earnings forecasts for 2009.
"We saw a pick-up in shipments in June," Chief Executive Iain Dorrity told Reuters in a telephone interview. "Some of the volume which we had discounted, we managed to ship after requests from customers."
Shares in the UK's largest listed solar technology company, which hit an all-time low of 69.25 pence in March, were up almost 3 percent at 85.35 pence at 0843 GMT, ranking them among the top gainers on the FTSE 250 mid-cap index .FTMC.
Analysts said the results reflected PV Crystalox's strong customer base in major solar markets Japan and Germany.
"The game for wafer suppliers is to improve yield, lower costs and maintain production throughput, and PV has maintained its margins better than others," said Ambrian's Dean Cooper.
David Cunningham at Arbuthnot said first-half shipments had surprised on the upside and reiterated his "Buy" recommendation on the stock.
"It has net cash, is paying a pretty decent dividend and is still profitable by a considerable margin. Even if pricing did get worse, PV is much better placed than others," he said.
PROFITS AND LOSSES
PV Crystalox reported a 10.5 percent fall in underlying operating profit to 41.8 million euros, stripping out currency effects and the start-up costs for its Bitterfeld polysilicon plant in Germany, but that contrasted with big losses reported by many solar firms over the last week.
Solar companies have been hit by an oversupply of silicon, forcing prices down just as subsidies were cut, while falling oil prices and a lack of credit available for major projects have led to a drop in demand.
On Tuesday, German solar module maker Solon (SOOG.DE) reported a wider than expected second-quarter loss and sales also missed forecasts. Peers Q-Cells (QCEG.DE), Conergy (CGYG.DE) and LDK Solar Co Ltd (LDK.N) also reported big losses last week. [ID:nLH511028] [ID:nLE396437]
PV Crystalox said pricing pressure would continue into the second half of 2009, with average pricing expected to be significantly lower than in the first half.
"There's a range of pricing, particularly from Chinese producers, that's putting pressure on all parts of the value chain," Dorrity told Reuters.
The company expected wafer sales volumes to improve in the second half and the total for the year to come in slightly down on 2008, when it delivered wafers sufficient for production of solar modules with total output of 230 megawatts.
"We believe that we will deliver between 210 and 230 MW in the full year, albeit at reduced pricing levels," Dorrity said. (Editing by Paul Sandle/Will Waterman) ($1=.7074 Euro)
