Trina, A Bit of Sunshine in the Solar Space (TSL)

Another Chinese integrated PV solar maker, Trina Solar Limited (NYSE:TSL) has reported less than was expected for its first quarter 2009. The net loss per fully diluted ADS was -$0.42, compared with a loss of -$0.03 in the fourth quarter of 2008. Revenues also fell sequentially, from $216.3 million to $132.1 million. Analysts had been expecting a net loss of -$0.08 per ADS on revenues of $142.5 million.

The combined effect of a $6.5 million charge related to a government reversal of approval for a tax holiday, an estimated $4.6 million cost related to cancellation of two supply agreements, and a $7.6 million foreign currency exchange loss, cost Trina $0.75 per fully diluted ADS.

Trina did not meet its expected sales target of 50-55 megawatts, instead shipping just 48.8 megawatts, down 15.3% sequentially, but up 65.5% year- over-year. The company expects to sell 60-65 megawatts of PV modules in the second quarter at a gross margin of 18%-20%. For the full fiscal year, Trina is sticking to its guidance for shipments of 350-400 megawatts.

The market seems to be taking the extraordinary charges into consideration in pre-market trading this morning. Trina shares are up about 6%, to $23.99. The company’s 52-week trading range is $5.61-$49.63.

Paul Ausick
May 28, 2009