Chinese solar glass supplier Xinyi Solar Holdings Limited has cautioned its shareholders that the company expects its consolidated net profit for H1/2022 to drop by around 33% to 43% annually, citing supply chain and prices pressures in the industry.
It would be down from HKD 3.07 billion the company reported for H1/2021 (see Xinyi Solar's H1/2021 Revenues Grow Over 74% YoY). This information, Xinyi shared, is basis information available for operational and financial data of the group for 5M/2022.
According to the management, there has been a YoY decrease of close to 10% to 20% in the average market prices of solar glass products in the reporting period. In comparison, average prices remained elevated in Q1/2021 and started to decline in Q2/2022.
At the same time, there has been a significant increase in the cost of raw materials and energy including soda ash and natural gas, that's also impacting its business negatively.
"The impact of the above adverse factors was partially offset by the Group's achievement of high sales volume and improved production efficiency," stated the company, and added, it plans to come out with unaudited consolidated results for the period before the end of August 2022.
In 2021, the group increased annual revenues for 2021 by 30.4% to HKD 16.06 billion despite the drop in solar glass ASP and increased costs for material and energy. Earlier, it had shared plans to enter the polysilicon manufacturing domain as Xinyi Silicon Holdings Limited, with Xinyi Glass Holdings Limited (see Xinyi Solar's 2021 Financial Results).