Q Cells posts solid Q3 results on post-merger strength

Hanwha Q Cells’ third-quarter gross profit jumped 59.2% from the preceding three-month period to $93m, as its shipments of PV modules rose 31.1% on the quarter to 805MW.

External orders accounted for 742MW of its quarterly shipments — as well as $423m of total revenue — with 11MW manufactured under OEM arrangements and 52MW delivered to the group’s own downstream projects.

Its downstream pipeline currently stands at roughly 1.2GW, with about 40% of that now in late-stage development.

The world’s largest maker of PV cells recorded net income of $52.4m for the three months to 30 September, on net revenue of $427m, up 26.4% quarter over quarter.

Its gross margin reached 21.8% — slightly above its quarterly guidance for a minimum of 18%.

The July-August period was the second full financial quarter for the New York-listed company, following the merger of China-based Hanwha SolarOne and Germany-based Hanwha Q Cells earlier this year.

"This quarter was one of the most significant milestones for the company, highlighted by a return to net profitability,” said chairman and chief executive Seong-woo Nam in an online statement.

“We are now more fully benefiting from the merger between Hanwha SolarOne and Hanwha Q Cells in February of this year, including the elimination of redundant costs, as reflected in the improvement in our operating expenses as a percentage of revenues.”

Average selling prices (ASP) of its externally shipped solar panels fell $0.02 per watt to $0.57 per watt in the third quarter, in line with declining ASPs in developing markets such as China and India.

North America was its biggest market, accounting for 30.6% of shipment-related revenue, followed by the Europe, Middle East and Africa region at 24.5% and Japan at 19.8%.

Nam added that the company remains on track with its “aggressive” plans to expand its production capacity to 5.2GW of PV cell and module output by the middle of 2016.

Roughly half of its products will be manufactured in South Korea and Malaysia, as those markets allow it to “ship modules duty free into the US."

The Seoul-based company aims to deliver 1.2GW to 1.4 GW of solar panels in the fourth quarter, with a targeted gross margin of more than 20%.

It is maintaining its full-year guidance of 3.2GW to 3.4GW of module shipments, on a projected gross margin of 19%.