Suntech Power (STP) Reports Mixed Results, Guides 09 Shipments To Low End Of Range

Suntech (STP) is out with earnings this morning and it’s not bad, not great.  You kind of expected this company to emerge from the pack a bit and post a much better quarter, but it didn’t happen.  The company reported another plunge in earnings and revenues when compared to the year ago quarter, but saw a bit of sequential growth so inline with what other solar companies are reporting.

STP reported .06/share which is better than what analysts had expected, but missed on the revenue side, reporting $321 million vs the expectations of $343 million

Here are a few quotes from the CEO:

“A seasonal pick up in demand combined with a gradual thawing of global financial markets and improving project returns led to sequential shipment growth in most of our major markets. In addition, despite pricing pressure, our continued reduction of silicon costs enabled us to improve gross margin in the second quarter.”

“In China we are building relationships with regional governments and key development partners in anticipation of a national feed-in tariff program. In Japan, we have established a relationship with Yamada Denki that will expand our distribution reach and improve brand recognition. And we are gaining traction in emerging markets such as the Middle East through partnerships with regional players.”

Looking ahead to next quarter, the company expects shipments to increase by 50% then level off in the 4th quarter.  Gross margins are expected to be flat compared to this quarter.  The company is revising its full year shipment estimate to 600MW which is the low end of the range of 600 – 700MW it gave last quarter.

Shares of STP are currently trading down about 2% in premarket trading.

::: >>>

Leave a Reply

Your email address will not be published. Required fields are marked *