North Coast Solar Stocks

April 29, 2009

First Solar 1Q profit triples on new projects

Filed under: FSLR — Tags: , , , , , — Jason @ 6:08 pm

First Solar 1Q profit triples despite tightened bank lending as company lands new projects

Chris Kahn, AP Energy Writer
Wednesday April 29, 2009, 6:08 pm EDT

NEW YORK (AP) — First Solar (FSLR), the nation’s largest solar panel maker, reported Wednesday that first-quarter profits more than tripled as the company inked numerous new power projects and cut its production costs.

The Tempe, Ariz.-based company reported Wednesday it earned $164.6 million, or $1.99 per share, in the first quarter, compared with $46.6 million, or 57 cents per share, for the same period last year.

Quarterly sales were $418.2 million for the three months that ended March 28, up from $196.9 million during the same period last year.

Analysts surveyed by Thomson Reuters expected earnings of $1.50 per share on sales of $403.67 million.

First Solar Inc., the largest solar company by market capitalization, said it reached two key production milestones this year. It built a total of 1 gigawatt of photovoltaic modules, and its manufacturing costs have dropped below $1 per watt.

CEO Michael Ahearn said the company also received orders for 479 megawatts of solar around the world. The company will supply solar modules for a 1 megawatt rooftop project in Australia and a 53 megawatt power plant in Germany. It will also build a 48 megawatt expansion to Sempra Generation’s solar power plant in Boulder City, Nev. and a 30 megawatt plant in northeastern New Mexico.

“These are very strong results, especially with the tough economic conditions we’ve been dealing with,” Ahearn said in a conference call with analysts.

Ahearn also announced Wednesday that he will step down as CEO and that the company board had already begun an external search to replace him. Ahearn said he will continue to serve as the company’s executive chairman and focus on developing public policies to help governments create low-carbon economies.

Company officials have said the global recession and tightened bank lending will squeeze profit margins this year despite federal stimulus grants and loan guarantees for renewable energy.

Ahearn said the banking industry is struggling, especially in Europe, and that will continue to weigh down the development of new projects.

“There’s a reason to be cautious until you see credit actually flowing, and we’re not seeing that,” he said.

To keep product moving, the company announced last quarter that it was forming partnerships with commercial power companies and investing in projects that are already under development to ensure they are completed.

The company released its earnings report Wednesday after the market closed. Shares increased $5.01 to close at $151.67. First Solar’s stock is now trading less than half of last year, when a spike in oil prices helped drive the company’s stock to an all-time high of $317 per share.

He said that stepping down as CEO was not meant to be a “half-step out of the business.”

“It’s more about reallocating my time to focus on external issues that I think are critical to the company and the industry.”

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