The rapid expansion of solar power around the globe filled the sails of Suntech, the world’s largest PV module maker, through the first three quarters of 2008.

The firm’s full-year shipments of solar products for the year grew 36% to 497.5MW. It has also reached the milestone of having an annual production capacity in excess of 1GW.

But while sales boomed through the first nine months of 2008, the company began feeling the effects of the financial crisis by the fourth quarter.

Suntech’s fourth-quarter revenues still managed to grow 4.2% over the same period last year, to $414.4m. But the figure represented a more than 30% drop over third-quarter 2008.

Suntech’s profit margin in the fourth quarter was 0.9%, compared to 21.8% in the third quarter.

The company blamed its shrinking margin on a decrease in shipments and “a rapid decrease” in the price of its PV products.

Suntech said while conditions will remain difficult in 2009, the battery of renewable energy initiatives being pushed by governments around the globe will offer substantial opportunities for growth.

“In particular, our continued investment in the US should position us for strong growth in that key market and its burgeoning utility-scale segment,” Suntech chief executive Zhengrong Shi says.

“We also believe that the project financing environment is improving and will continue to do so as the year progresses,” he says.

Nevertheless, the company says it intends to freeze capacity expansion during 2009 until the credit market improves. The majority of its capital expenditures will be spent retrofitting exciting facilities.

Suntech says it expects to ship modules worth 800MW during 2009. First-quarter revenues will likely fall between $340m and $380m.