It’s hard to say that things got worse for solar panel makers today, but it’s easy to say that things did not get better. LDK Solar Co. Ltd. (NYSE: LDK) reported results the first quarter today that fell way short of consensus estimates. The company’s outlook for the current quarter was also far short of analysts’ previous estimate.
LDK reported a loss of -$1.46 per ADS on revenue of $200.1 million. Consensus estimates called for a loss of -$1.14 per ADS on revenue of $225.5 million. Revenue fell by more than -50% year-over-year and gross margins were -65.2% compared with gross margins of +31.5% in the same period a year ago. Operating margins improved sequentially, however, from -126.5% in the fourth quarter to -67.9%. The company’s operating margin in the first quarter of 2011 was +25.6%.
The company’s second fiscal quarter forecast predicts even more of the same. The company forecast revenues in the range of $220-$270 million versus a previous consensus estimate of $370 million. For the 2012 fiscal year the company forecasts revenues of $1.5-$2.0 billion, well short of the prior consensus estimate of $2.07 billion.
LDK continues to be among the weakest of the large Chinese solar makers. Suntech Power Holdings Co. Ltd. (NYSE: STP), Trina Solar Ltd. (NYSE: TSL), JA Solar Holdings Co. Ltd. (NASDAQ: JASO), and Yingli Green Energy Holding Co. Ltd. (NYSE: YGE) have all run into problems of over-production and collapsing prices. The companies have tried share buybacks to prop up stock prices, but the likelihood grows that one or more of these makers will ultimately fold without government support.
LDK’s ADS are down nearly -7.5% this morning, at $1.87 in a 52-week range of $1.54-$7.52.
Paul Ausick
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