August 7, 2013 / 11:36 AM / in 4 years

UPDATE 2-SunEdison posts loss in solar unit, sees weak wafer market

* Second-quarter adj loss/shr $0.19 vs est $0.14

* Cuts full-year semiconductor materials sales forecast

* Solar energy unit sales fall 72 pct

* Shares fall as much as 29 pct (Adds details from statement, conference call, analyst comment, share movement)

By Garima Goel

Aug 7 (Reuters) - SunEdison Inc said its semiconductor materials business will remain weak, after reporting a loss in its solar energy business that doubled in the second quarter from the first.

The company’s shares fell as much as 29 percent on Wednesday morning, making them the biggest percentage loser on the New York Stock Exchange.

SunEdison said the semiconductor materials business, which makes wafers used in chips for computers, mobile phones and cars, will remain weak as the wafer market “continues to be in an extended downturn.”

“In recent weeks there have been mixed signals regarding semiconductor market strength in the near term, with demand not firming up across all sectors as expected,” Chief Financial Officer Brian Wuebbels said on a post-earnings call.

SunEdison, which changed its name from MEMC Electronic Materials Inc in May, lowered its full-year revenue forecast range for the semiconductor materials business by $20 million to between $940 million and $980 million.

The company said it expects a recovery in solar power installations in the current quarter. It forecast adjusted solar energy system sales of 60 megawatt (MW) to 100 MW in the third quarter, up from 51 MW in the second quarter.

“The investors are concerned about where margins are in the (solar energy) business right now and the timing of the revenue recognition on the megawatts that they are installing and constructing,” Ardour Capital analyst Adam Krop.

Solar panel prices have plunged due to a global glut and lower demand from Europe.

SunEdison gets nearly two-thirds of its revenue from its solar energy business that designs, installs, finances and maintains solar power plants.

The company, which combined its solar businesses last year, now has two businesses: semiconductor materials and solar energy.

SunEdison’s stock has risen nearly five times over the past year. It trades at 67 times forward 12-month earnings, a huge premium to the sector median of 17, according to Thomson Reuters data.

Adjusted loss in the second quarter was 19 cents per share. Analysts on average had expected a loss of 14 cents per share, according to Thomson Reuters I/B/E/S.

Total revenue halved to $401.3 million.

Loss at the solar energy business widened to $25.2 million in the quarter ended June from $10.8 million, in the first quarter. The business reported a profit of $11.7 million in the second quarter of last year.

SunEdison shares were down 22 percent at $7.55 in late morning trade. (Writing by Sayantani Ghosh in Bangalore; Editing by Joyjeet Das and Robin Paxton)

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