Canadian Solar today said its production plants have experienced under-utilization due to the changing tariff and market conditions in the US.
The company did not reveal what percentage was the reduction in solar manufacturing due to the tariff change in the U.S.
“Some of the module and cell production plants in Canada and South East Asia are under-utilized due to the Section 201 tariff decisions by the U.S. government,” Canadian Solar CEO Shawn Qu said.
A Reuters report on March 15 said U.S. solar energy installations will grow slower than previously expected in the coming years due to the Trump administration’s tariffs on panel imports and new federal tax laws that will restrict investment in the clean energy source
Canadian Solar expects solar module shipments in Q1 2018 will be approximately 1.30 GW to 1.35 GW, including 65 MW of shipments to its utility-scale solar power projects that may not be recognized as revenue in first quarter 2018.
Canadian Solar is targeting revenue of $1,370-$1,400 million with gross margin of 10-12 percent, “which reflects the impact of lower margin U.S. solar projects we have already sold in the quarter”.
Canadian Solar is aiming to ship 6.6 GW to 7.1 GW modules in 2018. Canadian Solar targets full year revenue of $4.4-$4.6 billion.
“We expect 53 percent of revenue to come from Solar Module and Components Business, while the balance will come from our energy business. The Energy Business revenue will mainly come from the company’s solar power plants in the U.S., Japan, China and the UK,” Shawn Qu said.
Canadian Solar expects its cost of production will decrease throughout the year as material costs decrease and new, higher efficiency cell and module capacity comes online.
Business performance
Canadian Solar announced its results for the fourth quarter and full year ended December 31, 2017.
2017
Canadian Solar achieved solar module shipments of 6,828 MW in 2017, compared to 5,232 MW in 2016.
Net revenue of Canadian Solar was $3.39 billion, compared to $2.85 billion in 2016.
Net revenue from the total solutions business was 22.8 percent of total net revenue, compared to 8.1 percent in 2016.
Net income of Canadian Solar was $99.6 million compared to $65.2 million.
Q4 2017
Canadian Solar’s solar module shipments reached 1,831 MW in Q4 against 1,870 MW in Q3 2017.
Canadian Solar’s net revenue rose 21.5 percent to $1.11 billion from $912.2 million in the third quarter of 2017 and increased 65.9 percent from $668.4 million in the fourth quarter of 2016.
Net income of Canadian Solar was $61.4 million compared to net income of $13.3 million.
Total operating expenses in the fourth quarter of 2017 were $88.4 million, down 13.4 percent from $102.0 million in the third quarter of 2017 and up 45.6 percent from $60.7 million in the fourth quarter of 2016.
The company’s ingot manufacturing capacity reached 1.2 GW in 2017 and is expected to reach 1.62 GW by June 30, 2018 and 2.0 GW by December 31, 2018. The increase is intended to reduce the purchase cost of ingots and therefore reduce the Company’s all-in module manufacturing cost.
The company’s wafer manufacturing capacity was 5 GW in 2017, all of which uses diamond wire-saw technology. Diamond wire-saw technology is compatible with the company’s black silicon multi-crystalline solar cell technology, thereby reducing silicon usage and manufacturing cost.
The company’s solar cell manufacturing capacity in 2017 was 5.45 GW. The company will increase its cell manufacturing capacity to 5.6 GW by June 30, 2018 and 6.35 GW by December 31, 2018.
The company’s module manufacturing capacity was 8.11 GW in 2017 and it is expected to reach 8.31 GW by June 30, 2018 and 9.81 GW by the end of 2018.
Rajani Baburajan