Xinyi Solar, one of the world's largest solar PV glass manufacturers from China, reported a strong year for the company in 2020 having grown its annual revenues by 35.4% to a total of HKD 12.31 billion. Management attributes the reason to this growth in revenues to the increase in both price and sales volumes in H2/2020.
To this group revenue, solar glass sales added HKD 9.99 billion with most of it sold within China, reflecting an annual growth of 55.8% in China and 26.1% 26.1% overseas. The management added overseas sales accounted for 23.5% of the group's total solar glass sales in 2020. The solar farm segment added revenues of HKD 2.32 billion.
At the same time, the profit contribution from the group's solar glass business increased significantly, leading it to increase profit attributable to the equity holders by 88.7% on annual basis to HKD 4.56 billion. In December 2020, Xinyi Solar had issued a profit alert for the year 2020, expecting an annual net profit increase of 75% to 95% through it did not specify the numbers back then (see Xinyi Solar Issues Profit Alert For Year 2020).
Gross profit for the group increased by 68.3% to HKD 6.58 billion, while overall gross profit margin rose to 53.5%, as per the company's financial results shared in a stock exchange announcement.
Xinyi Solar confirmed the COVID-19 pandemic had no material impact on its business operations in 2020, and that its solar glass business was largely unaffected since there was no disruption to raw glass production, except for certain processing works as tempering and coating were delayed in Q1/2020. All its furnaces ran 24×7.
The sharp increase in demand for solar PV in H2/2020, Xinyi Solar pointed out, has put a tremendous pressure on the supply chain, especially for solar glass that has been leading to an upward revision in its price that has gone up more than 70% during the 2nd half of 2020.
Xinyi Solar increased its aggregate daily melting capacity to 9,800 MT with the addition of 2 new solar glass production lines in June 2020 and August 2020, growing it from 7,800 MT in H1/2020. It shared that to increase its market share for products addressing 182mm and 210mm solar modules as well as in double-glass and bifacial products, the company has adopted flexible production and marketing strategies.
The management sees higher demand for thin PV glass going forward as the demand for double-glass and bifacial solar modules goes up. "In light of this, the Group will expedite construction work on capacity additions in 2021. For the four new solar glass production lines in Anhui with a daily melting capacity of 1,000 tonnes each, the previous timetable was to start a new line per quarter, but now the schedule has been advanced," stated Xinyi Solar and added, "As a medium-term plan, the Group has started the planning and construction work for 16 new solar glass production lines with a daily melting capacity of 1,000 each in Zhangjiagang (Jiangsu province) and Anhui. The construction of the four new production lines in Zhangjiagang is expected to complete in 2022. The Group will continuously review and adjust its expansion plan to adapt to the changing market conditions."
For its solar farm business, Xinyi Solar is targeting an annual installation target of 600 MW for 2021.
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