Tue, May 16, 2017 - Page 12 News List

Neo Solar in fragile state as recovery efforts show

By Lisa Wang  /  Staff reporter

Solar cell maker Neo Solar Power Corp (新日光能源) yesterday reported a smaller quarterly loss of NT$1.32 billion (US$43.77 million) for the last quarter, amid a fragile recovery.

The figure represented an improvement from a quarterly loss of NT$4.44 billion in the final quarter of last year that included asset impairment losses from idled equipment and factory allocation costs.

Gross margin was unchanged at minus-11.56 percent, compared with the fourth quarter, the Hsinchu-based company said.

In the first quarter of last year, Neo Solar made a net profit of NT$109 million. Gross margins were in the positive territory of 8.71 percent.

“The anticipated solar installation boom in China did not happen in the first half of this year. The Chinese government tightened its grip on the [overheating] industry,” Neo Solar said.

Neo Solar attributed its fourth loss in a row to a tepid rebound in average selling prices of multicrystalline solar cells, which took a nosedive last year due to overcapacity.

To mitigate effects from a prolonged industry slump, the company said it has reduced shipments of unprofitable multicrystaline solar cells and increased shipments of higher-margin, high-efficiency monocrystalline solar cells.

Neo Solar expects its efforts to yield results in the fourth quarter, as it shifts to more stable businesses.

Neo Solar said it holds about NT$7.15 billion cash, or cash equivalents.

Separately, local peer Sino-American Silicon Products Inc (SAS, 中美晶) yesterday also reported a quarterly loss of NT$405 million last quarter, mostly because foreign exchange losses eroded profits.

SAS, which mostly makes monocrystalline solar cells, made operating profits of NT$647 million last quarter, the company’s financial statement showed.

Non-operating losses stood at NT$656 million, including a foreign exchange loss of NT$400 million.

Gross margins dropped to 13.6 percent last quarter, compared with 15.83 percent last year.

SAS also said it is tapping into the growing solar market by setting up a joint venture with Cathay Financial Holding Co (國泰人壽), targeting rising demand for roof-top solar panel installation.

The company also helps install solar panels worldwide.

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