* Sees margins, market share up this year - CEO
* No plans to sell stake of about 30 percent - CEO
* Open to all possibilities in sector consolidation - CEO
By Christoph Steitz
MUNICH, June 9 Suntech Power STP.N, the
world's largest solar cell maker, expects its margins to expand
this year, its chief executive said, adding he had no plans to
sell his stake of about 30 percent in the company.
At a time when solar companies such as SunPower SPWRA.O,
LDK Solar LDK.N and SMA Solar (S92G.DE) forecast shrinking
profit margins due to falling module prices and oversupply,
Suntech's Zhengrong Shi said he was confident the company could
buck the trend. [ID:nN07174923] [ID:nLDE74P0ST]
The company is ramping up output of polysilicon wafers
needed for solar cells, thereby lowering manufacturing costs
that would occur if the product had to be sourced from a third
"We're going to be expanding our margin and market share,"
Shi, who is also Suntech's chairman and founder, told reporters
in Munich late on Wednesday when asked about margin development
in the ongoing business year.
According to Thomson Reuters I/B/E/S estimates, the
company's gross margin is seen at 18.5 percent this year, up
from 17.4 percent in 2010.
Graphic on EPIA's growth estimates through 2015:
Graphic on the world's top solar cell makers:
Suntech in late May cut its 2011 sales outlook range to
$3.3-3.5 billion from $3.4-3.6 billion due to a strong decline
in module prices. According to Thomson Reuters I/B/E/S, 2011
sales are seen at $3.36 billion. [ID:nL3E7GP1J0]
The solar industry has been hit by concerns about Italy --
which last year grew to become the world's second-largest solar
market -- where support for the subsidy-dependent sector was
lowered last month.
Uncertainty over what shape the new subsidy rules would take
led to a near standstill of the Italian market in the
first-quarter, hurting revenues and volumes of solar companies
around the world and Suntech has warned about a challenging set
of quarters ahead. [ID:nL3E7GP1J0]
The company expects low single-digit percentage growth in
shipments and relatively flat gross margins in the second
quarter, compared with the first three months.
Shi said the company had to be "open to all possibilities"
in the sector's consolidation, which has started to speed up as
Japan's nuclear disaster has accelerated a rethink of
governments and large energy groups.
"A partnership across the value chain is inevitable in the
long-term, it's quite feasible," Shi said, when asked whether
the company could remain independent in the long-term, adding he
intended not to lower his stake of about 30 percent.
"I have no plans to sell." he said.