Trina, Yingli up Q1 margin guide
Trina Solar today became the second major Chinese module supplier to lift its gross-margin guidance for the first quarter on higher average selling prices, even as it lowered its overall shipment guidance.
Following rival Yingli, which earlier in the day warned investors that its first-quarter shipments would come in lower than expected, Trina shrank its shipment guidance, from 670MW-700MW to 540MW-570MW.
Trina blamed uncertainty in the EU pending an agreement on a new minimum import price, a situation it believes will turn around as soon the EU’s new rules have been finalized.
In its own market update, Yingli fingered soft demand in China tied to market seasonality and a delayed delivery schedule for a large project in Algeria.
However, both companies - the world's number one and two module suppliers - maintained their full-year shipment guidance, with Trina anticipating delivering 3.6GW-3.8GW in 2014, and Yingli anticipating 4GW-4.2GW.
Of that figure, Trina expects 400MW-500MW to go into its own downstream projects, with those deliveries expected to skew towards the latter half of the year.
Yet even as it dimmed its shipment guidance, Trina raised its gross-margin guidance to 18-20% in the first quarter, up from the “mid-teens”prediction it previously offered.
By contrast, the slightly-larger Yingli now expects a gross margin of 15.5-16.5% in the first quarter.
Trina's better-than-expected margin performance is due to higher average selling prices and the recent sale of the company's first utility-scale PV project in China.
The 50MW project, sold to Hudian Fuxin Energy Corp., fetched Trina a gross margin in the "high teens".
“We remain confident that ongoing market demand for our products ist rong, and that we will be able to maintain our expected level of growth in 2014 as planned,” says Trina chief executive Jifan Gao.