Canadian Solar (NASDAQ: CSIQ) said Aug. 13 that its solar module shipments in the second quarter were 646 MW, compared to 500 MW in the first quarter of 2014 and to second quarter guidance in the range of 600 MW to 630 MW.
Dr. Shawn Qu, Chairman and Chief Executive Officer of Canadian Solar, remarked: “Our second quarter shipments and revenue came in above the high end of our guidance led by strong module demand out of Japan, Germany, the UK and the US, as well as progress in the build-out of our utility-scale solar projects in Canada. Gross margin in the second quarter improved significantly to 19.0% compared to 14.7% in the first quarter of 2014, reflecting solid execution of our total solutions business strategy, as well as higher module ASP and shipment volume.”
He added: “We believe we remain one of the solar industry’s best positioned companies given our diverse manufacturing footprint and advanced-stage project pipeline in Canada, Japan, the U.S., and China. We are making steady progress in key developing markets in Asia, the Middle East, Latin America and Africa, and we continue to see robust demand for our solar energy solutions products and services across all geographies and market segments.”
Michael Potter, Senior Vice President and Chief Financial Officer of Canadian Solar, added: “Our second quarter financial results clearly reflect our focus on profitable module sales over module volume and our emphasis on our higher margin total solutions business. Our revenue, MW shipment and net income for the second quarter of 2014 all set quarterly records for the company. This improvement underscores our focus on becoming the industry’s most profitable company. We ended the second quarter with$788.3 million in cash, cash equivalents and restricted cash. This continues to give us a considerable advantage as we pursue higher margin solar module and utility-scale project opportunities in our target markets, and work to build shareholder value.”
At the end of June 2014, the company had a pipeline of late stage utility-scale solar projects totaling approximately 1.3 GW (dc). These projects include owned and joint-venture projects as well as projects where the company provides EPC services.
In Canada, during the second quarter of 2014, Canadian Solar closed the sale of the 10-MW (ac) Val Caron solar plant valued at over C$60m to One West Holdings Ltd., an affiliate of Concord Green Energy. Currently eight of the company’s projects in Ontario are in commercial operation. Three of them have already been sold to investors and part of their revenue has been captured in the previous quarters, while five of them are pending completion of sale to investors.
Also in Canada, during the second quarter of 2014, the company entered into an EPC agreement with Kingston Solar LP, a solar energy partnership formed by Samsung for the construction of a 140 MW (dc) utility-scale solar plant in Kingston, Ontario.
A number of Ontario projects in the works of about 14 MW in size
The company’s late stage solar project pipeline in Ontario, Canada, now stands at approximately 534.8 MW (dc).
Example projects in Ontario include:
- Alfred, 13.6 MW (dc), in permitting, due for commercial operation in the second quarter of 2015;
- Foto Light LP, 14 MW (dc), in construction, commercial operation in fourth quarter 2014;
- Illumination LP, 14 MW (dc), engineering stage, commercial in second quarter 2015;
- Gold Light LP, 14 MW (dc), in construction, fourth quarter 2014;
- Beam Light LP, 14 MW (dc), engineering, second quarter 2015;
- Earth Light LP, 14 MW (dc), engineering, second quarter 2015;
- Lunar Light LP, 14 MW (dc), engineering, second quarter 2015; and
- Discovery Light LP, 11.6 MW (dc), in construction, fourth quarter 2014.
In the United States, at the end of the second quarter 2014, the company’s late stage, utility-scale solar power project pipeline totaled approximately 105.8 MW (dc) compared to 151.5 MW (dc) at the end of the first quarter of 2014. During the second quarter the company completed construction of 12.4 MW (dc) and sold projects totaling 28 MW (dc) that were still under development. The company plans to expand its pipeline in the U.S. through self-development and through joint-venture agreements in the quarters ahead.
The estimated commercial operation dates of all of the company’s late-stage projects in Canada, the U.S., Japan and China is subject to change without notice as a result of delays in permitting and construction, among other risk factors, the company noted.
Qu said: “We expect Japan, Canada, China, Europe and the US, among others, to remain healthy markets for us through the end of 2014 and beyond. On the total solutions business front, we expect to continue our steady progress. All but one of our projects in Ontario are now fully permitted, and eight of them are in commercial operation and others are moving well in construction. This gives us confidence that we are well positioned to deliver record results to our shareholders in the quarters ahead. The recent launch of several YieldCos has increased demand for our solar power plants and we are already seeing higher prices for our projects. With respect to the possibility of Canadian Solar launching its own YieldCo, we are evaluating options in the context of our existing late-stage pipeline and we expect to be in a position to make a decision by early 2015.”