Leading Chinese solar PV manufacturer JinkoSolar Holding saw its total solar module shipments during Q1/2024 reach 20 GW, with 70% of these going to the Asia Pacific (APAC) and emerging markets. Despite the 53.3% Year-over-Year (YoY) increase in module shipments, its total revenues declined 29.8% sequentially and 1.2% YoY to $3.19 billion due to a sequential decrease in solar module shipments and a drop in module ASPs.
JinkoSolar's gross profit of $378.8 million also dropped 33.1% quarter-on-quarter (QoQ) and 32.2% YoY, while gross margin declined to 11.9%, compared to 12.5% in Q4/2023 and 17.3% in Q1/2023. Its net income of $84.4 million was up 19.8 times sequentially.
The management shared that while shipments to the US during the reporting quarter were stable, those to Europe improved nearly 20%, which shows 'evidence of future inventories reduction.'
Over the next 3 quarters, the Chinese company expects shipments to Europe and the US to further increase over the last year.
The distributed generation (DG) business accounted for 50% of Jinko's business in Q1/2024 and is expected to account for 30% to 40% for full-year 2024.
N-type shipments accounted for nearly 80% of its module shipments. The management continues to accelerate the phaseout of its p-type capacity and expects n-type to account for over 90% of total capacity by the end of this year.
JinkoSolar's Chairman and CEO Xiande Li shared that the manufacturer was able to maintain its utilization rate at a high level, even as the average industry utilization rate declined sharply.
Li added, "We expect the profitability of integrated solar companies to come under pressure in the short term, and the impact on different companies varies depending on their specific operational capabilities. As a result, we believe overall production capacity in our industry will shrink with the elimination of weaker players that lack market competitiveness, sustainable production capabilities, and the ability to regularly upgrade and iterate technology."
Discussing the anti-dumping and countervailing duties (AD/CVD) with analysts post the financial results announcements, Jinko's CMO Gener Miao admitted that it is a big challenge as it would also lead to an increase in costs. He added that even though the company continues to work with lawyers and customers to find out the best solutions, it needs 3 to 6 months to see what impact it could lead to.
Nonetheless, Roth MKM's Philip Shen said, "We continue to see JKS in a strong position with its leading TOPCon/cost structure, but we see risk from sustained oversupply and the new SEA AD/CVD tariffs."
By the end of 2024, JinkoSolar management expects its annual production capacity for mono wafers to reach 120 GW, 110 GW for cells and 130 GW for modules. This will comprise 12 GW of integrated overseas capacity, including 2 GW n-type module capacity in the US.
The Chinese manufacturer has operationalized 1 GW of n-type module production capacity in the US with another 1 GW set to come online in Q2/2024.
By year-end, Jinko expects the 2 phases of its 56 GW integrated wafer-cell-modules complex in China to be online with 14 GW each. This will bring down its operating costs at full production.
It will increase its production capacity from 85 GW for mono wafers, 90 GW for cells (both PERC and n-type), and 110 GW for modules it had at the end of 2023.
In terms of technology, it aims to increase the mass-produced n-type cell efficiency to 26.5% by this year-end.
During Q2/2024, JinkoSolar targets to increase its solar module shipments within the range of 24 GW to 26 GW, contributing to the annual goal of 100 GW to 110 GW.
In a separate announcement, the management said one of its silicon wafer slicing and solar cell manufacturing workshops in Shanxi province suffered a fire accident. It is expected to impact the company's operations and financial results in 2024.