ReneSola slashes second quarter outlook
China-based ReneSola (NYSE:SOL) lowered its second quarter guidance on Tuesday due to a drop in solar wafer prices and a challenging solar module market.
Shares in ReneSola lost 30 cents, or 6.41% to $4.38 in Tuesday morning trade, on the New York Stock Exchange.
For the second quarter, the solar power products maker now expects revenue to be in the tune of US$235 to US$245 million, compared to its previous range of US$280 to US$300 million. Analysts were forecasting revenue of US$286.87 million.
Gross profit margin for the latest quarter is anticipated to be between 17% to 19%, compared to the company's prior range of 25% to 27%.
ReneSola also predicts its total solar wafer and module shipments will now be between 290 to 300 megawatts, in sharp contrast to its earlier guidance of 330 to 350 megawatts.
"We experienced greater-than-expected price declines in both our core wafer business and supporting module business in the second quarter of 2011," said ReneSola's chief executive, Xianshou Li.
However, the company expects manufacturing costs will decrease with its in-house polysilicon production expansion, and proprietary technology advances in manufacturing, helping to ease margin pressure.
"We will maintain our focus on our core wafer business, as well as horizontal expansion to reduce costs, and will continue selling modules to our customers," added Li
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