JA Solar in modest upswing

JA Solar narrowed its net losses in the second quarter as the global PV market heals, but the pace of its recovery appears more sluggish than that of some of its peers. 

Like the other major Chinese PV manufacturers which have revealed their second-quarter financial performances, JA improved on nearly every key metric – from shipments to revenue to gross margin.

Yet the improvement, in most cases, was relatively modest.  JA, historically a cell specialist which has pivoted aggressively to include modules in recent years, shipped 464MW of PV kit during the first quarter – comfortably above its 430MW guidance.

Nevertheless, that performance represents just a 4.7% increase on the first quarter. By comparison, rival Trina Solar, which reported its results last week, saw a 65% sequential uptick in module shipments. 

New York-listed shares in JA Solar dropped more than 5% in early trading, bucking an otherwise buoyant equities market.

JA swallowed a second-quarter net loss equivalent to $21.6m, narrowing the $33.3m it lost during the first quarter. 

That stacks up positively against the $33.7m Trina Solar lost during the first quarter. But Canadian Solar’s net loss came to just $7.9m during the period – and unlike JA it managed to record an operating profit.

Another rival, JinkoSolar, bounced back into the black with a $7.9m net quarterly profit.  JA’s gross margin for the quarter was 8.1%, compared to Trina’s 11.6%, Canadian Solar’s 12.8%, and Jinko’s 17.7%.

JA chief executive Baofang Jin nevertheless claims he is “encouraged” by his company’s performance during the quarter. JA is the world’s fastest growing major supplier of modules, cracking into the top 10 last year for the first time.

One area where JA excelled during the second quarter was in generating operating cash flow, which at $82m was higher than any of its peers. JA also continues to strongly grow the share of its revenue coming from outside Europe.

“In particular, we’re excited about the long-term opportunity to increase our market share in the US, where we have established a bankable brand,” Jin says.

Nearly 40% of JA’s shipments during the second quarter went to China, and Jin flags up the company’s “significant progress” in emerging markets like Thailand and Australia. 

Another bright spot for JA is its fast-growing projects business. The company recently commenced construction at a 50MW project in China’s Gansu province, and earlier this week it unveiled a landmark plan to develop and build 300MW of capacity in Hebei province.