- ReneSola’s revenues during Q1/2019 dropped 71% YoY but improved 134% compared to the previous quarter
- Gross profit too decline to $0.4 million with gross margin of 2.8%, compared to gross profit of $8.4 million and gross margin of 18.7% in Q1/2018
- Its net loss during Q1/2019 went up to $5.6 million from a net income of $5.4 million in Q1/2018
- Full year guidance has been repeated by the management while during Q2/2019 it expects revenues of $10 million to $12 million with a gross margin of 55% to 65%
Delays In Project Sales During Q4/2018 Pulled Down ReneSola’s Revenues By 6% In 2018 Yet Company Reported 59% Increase In Net Profit As EBITDA Rose 82% YoY
(10. April 2019)
ReneSola Achieves Revenue Guidance In Q3/2018, Increased Net Income QoQ, Yet Reports Less Than Q3/2017; Late Stage Pipeline Stands At 783.3 MW
(26. November 2018)
Chinese PV Developer ReneSola Counting On Brookfield Deal For 200 MW DG Projects In China To ‘Recycle Back’ Into Business As Company Suffers Revenue Loss & Net Income Loss In Q2/2018
(09. September 2018)
The year 2018 brought down Chinese solar power project developer ReneSola’s revenues by 6% annually owing to delays in project sales. However, its net profit grew 59% and EBITDA went up by 82% YoY (see ReneSola Revenues Dropped As Profit Grew In 2018).
On an annual basis, the year 2019 too doesn’t seem to have started on a positive note as the Chinese company YoY revenues declined by 71% YoY in Q1 even though this was a 134% increase on sequential basis. The management did not specify the reason behind the annual decline in sales. Most part of the revenue came from the sale of a 21.1 MW project in Minnesota.
Its gross profit in the reporting period reached $0.4 million with a gross margin of 2.8%, compared to a gross profit of $8.4 million and a gross margin of 18.7% in Q1/2018, which was attributed to the revenue mix, coupled with unfavourable margins from project sales in the US. Net loss for the company in Q1/2019 increased to $5.6 million from $4.3 million in Q4/2018 and a net income of $5.4 million last year.
While the company confirmed that it increased its cash and equivalents at the end of March 2019 to $7 million, up $0.2 million over the previous year, it achieved the distinction due to reclassification of a $28.8 million Romania construction loan from long-term borrowings to short-term borrowings. This is due to be paid back in March 2020.
Main highlight for ReneSola during Q2/2019 is the deal to originate and develop large utility scale solar projects for X-Elio North America starting with an initial 500 MW project capacity reported in June 2019 (see ReneSola & X-Elio To Explore 500 MW Together). This has boosted its global late-stage pipeline to 752.7 MW with a total project pipeline of 1.4 GW.
During Q2/2019, ReneSola expects to report revenues of $10 million to $12 million with a gross margin of 55% to 65%; for the entire year 2019, it has repeated the previous guidance of revenues between $150 million to $170 million and a gross margin at 20% to 25%. “We anticipate meaningful revenue growth in the second half relative to the first half of 2019, as we expect significant revenue contribution from project sales in the second half of the year,” said company’s Chairman and CEO Xianshou Li in a letter to the shareholders.
Providing an update for its business plans within China, ReneSola said it has submitted applications for subsidies to the National Energy Administration (NEA) to partake from the RMB 750 million ($109 million) reserved for 3.5 GW of household solar capacity out of RMB 3 billion ($435 million) total subsidies for new solar projects in 2019 (see China Issues Draft Policy For Solar/Wind Projects).
Roth Capital had the following key takeaways from the ReneSola’s results. ‘First, its late-stage pipeline decreased to 753 MW in Q1 from 773 MW in Q4, while the total pipeline decreased to 1.4 GW from 1.7 GW. Second, the company plans to monetize 270MW of projects in international markets in 2019 and plans to eventually sell the 208MW of China DG assets. And third, we believe the Q2’19 revenue mix could be ~75% IPP sales and 25% build-to-transfer sales.’ The Roth analysts concluded, “With only ~$24mn (~15%) of 2019 revenue expected to be realized in H1’19 and the weak Q1 project margins, we continue to see risk to the 2019 guide.”