August 5, 2014 / 10:16 PM / 4 years ago

UPDATE 1-First Solar cuts production forecast; profit misses

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Aug 5 (Reuters) - First Solar Inc, the biggest solar panel maker in the United States, reported a lower-than-expected quarterly profit, sending its shares down 5 percent in extended trade.

The company cut its full-year production forecast to 1.8-1.9 gigawatts (GW) from 1.9-2.0 GW.

“While project delays in Q2 resulted in deferring some earnings to later in the year we remain on track to our financial targets for the year and reaffirm our full-year 2014 EPS,” First Solar CEO Jim Hughes said in a statement.

The company said it expected full-year operating expenses to rise to $380 million-$395 million from $365 million-$385 million.

First Solar, in an attempt to boost margins, has been building solar plants for big U.S. power companies rather than supplying only solar panels.

The company, which is sacrificing near-term revenue to ensure a long-term profit, has said it plans to keep some of those projects rather than sell them outright to ensure stable cash flow and lower its cost of financing new projects.

Net income fell 86 percent to $4.5 million, or 4 cents per share, in the second quarter ended June 30, from $33.6 million, or 37 cents per share, a year earlier.

The Tempe, Arizona-based company’s revenue rose 4.7 percent to $544.4 million.

The average analyst estimate was for a profit of 37 cents per share on revenue of $795.9 million, according to Thomson Reuters I/B/E/S.

First Solar’s shares closed at $63.66 on the Nasdaq on Tuesday. The stock has gained more than 16 percent this year. (Reporting By Tanvi Mehta and Shubhankar Chakravorty in Bangalore; Editing by Sriraj Kalluvila)

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