Green Energy Technology Inc (綠能科技), the nation’s biggest solar wafer maker, expected its net income to drop slightly this quarter from last quarter because of impairment losses from a corporate bond conversion, a company executive said yesterday.
Green Energy’s net profits expanded 6.21 times to NT$844 million (US$28.51 million), or NT$4.16 per share, in the final quarter of last year, compared with NT$117 million, or NT$0.85 a share, in the same period of 2009. Revenues doubled to NT$5.66 billion during the same period of time.
On a quarterly basis, that represented about a 3.66-fold growth from a net income of NT$181 million, or NT$0.86 per share, in the third quarter of last year, bringing the full year earnings to NT$1.66 billion, a spike from earnings of NT$115 million in 2009.
Gross margin rose to 17.47 percent last quarter from 15.8 percent a quarter ago. Average selling price jumped 1.1 percent to US$3.56 per watt in the fourth quarter, from US$3.52 per watt in the third quarter, Green Energy said.
However, this quarter, net income is expected to decrease to about NT$800 million because of about NT$400 million in -impairment losses as its corporate bondholders are expected to convert all their holdings into 14.83 million Green Energy shares at the end of next month, company financial executive Polar Hsieh (謝國雄) told investors.
As corporate bonds are considered a form of debt, losses result from the difference between market price of the issuing company and the price set for bondholders to convert their bonds.
Green Energy shares were unchanged yesterday at NT$147, much higher than the price of NT$84 per share set for -bondholders to -convert their bonds.
Hsieh stressed that the impairment loss “will not have any [adverse] impact on the company’s operation and cash flow as it was a result of accounting rules.”
Without considering the impairment losses, Green Energy could make NT$1.2 billion in net profits, Hsieh said, which would greatly exceed the company’s previous forecast of NT$711 million in pretax profits.
The Taoyuan-based company said it has operated its plants at full capacity because of strong demand for all of last year.
To cope with the persistent uptrend, Green Energy planned to speed up its wafer capacity expansion to 2 gigawatts a year, from 1.5 gigawatts originally planned, Green Energy president Lin Hur-lon (林和龍) said.
The company yesterday also signed a seven-year US$507 million supply contract with South Korean polysilicon maker OCI Co to begin next year and run through 2018, according to a statement filed with the Taiwan Stock Exchange.
“With a stable supply of polysilicon, our business can grow according to plan,” Lin said.
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