* Sees first-quarter shipments of 410-430 MW vs 500 MW in
* Fourth-quarter loss $2.65/ADS vs $0.39/ADS year earlier
* Expects European investigations to impact shipments to
* Shares down 12 pct
By Garima Goel
March 25 Chinese Solar panel maker JA Solar
Holdings Co shuttered some of its production capacity
to rein in costs as it struggles with a steep decline in panel
prices at a time when the country's support for the industry is
Shares of the company fell as much as 12 percent after it
reported a loss for the seventh straight quarter and negative
margins for the second quarter on Monday.
"The disappointment is not so much the shipment guidance but
the fact that gross margin remained firmly negative in the
fourth quarter even with the beat in shipments," Raymond James
analyst Pavel Molchanov said.
Fourth-quarter gross margins improved to negative 4.6
percent from negative 5.9 percent in the third quarter. The
company said it expects positive margins in the first quarter,
helped by an increasing focus on Japan, the Middle East and
Solar modules fetch the highest prices in Japan, where the
government is trying to phase out nuclear power, analysts have
Rapid capacity expansion in China and a drop in demand in
top market Europe have sent panel prices plunging 66 percent
over the past two years, making profits elusive for solar
product makers and forcing many to close plants.
China-based Suntech Power Holdings Co Ltd, whose
main unit is involved in insolvency proceedings, closed its only
U.S. solar panel plant earlier this month.
China and emerging markets like Japan accounted for more
than two-thirds of JA Solar's fourth-quarter shipments of 500
megawatts (MW), while Europe made up about 16 percent.
The ongoing European investigations into alleged dumping and
subsidies of China-made solar products could impact the
company's shipments to Europe, Chief Operating Officer Jian Xie
said on a post-earnings conference call.
JA solar, all of whose manufacturing operations are in
China, expects first-quarter shipments to fall to 410-430 MW.
The company expects to ship 1.7-1.9 GW of cells and panels
this year, compared with 1.7 GW in 2012.
Shares of rivals Trina Solar Ltd and Yingli Green
Energy Holding Co fell more than 5 percent in morning
JA Solar said it shut 300 MW, or 12 percent, of its cell
production capacity and 300 MW, or 17 percent, of panel capacity
during the fourth quarter.
The company had annual cell production capacity of 2.5 GW
and panel capacity of 1.8 GW as of Dec. 31.
A number of solar companies including industry leaders First
Solar Inc and SunPower Corp have cut
production in the past few months.
During the fourth quarter, JA Solar's net loss widened to
$102.4 million, or $2.65 per American Depositary Share (ADS),
from $68.3 million, or $0.39 per ADS, a year earlier.
Revenue fell 13 percent to $268.1 million.
Shares of the company were trading down at $3.83 on the
Nasdaq on Monday.