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Bloomberg
First Solar Inc. reported its biggest-ever loss after overhauling its manufacturing strategy and firing more than a quarter of its workforce. The bulk of its pain may be in the past.
The largest US solar manufacturer posted a fourth-quarter net loss of $719.9 million, largely due to a $729 million restructuring charge, Tempe, Arizona-based First Solar said in a statement, but increased its sales
forecast for 2017.
The company announced in November plans to scrap a new panel design this year, the Series 5, while firing 1,600 workers and retooling its factories to produce the Series 6 starting in mid-2018. The move came as a global oversupply helped drag panel prices down 35 percent last year. Sales last year slipped 18 percent to $2.95 billion in 2016, but may be close to flat this year as Chief Executive Officer Mark Widmar’s plans start to take effect.
“When you see module price dropping as rapidly as we did going back to July you have make adjustments,†Widmar said on a conference call Tuesday. “We have seen prices start to stabilize.†He was promoted in July from chief financial officer and immediately began reviewing First Solar’s strategy. Without the Series 5 panel, the company is relying on its aging Series 4 design, which is less competitive compared to rivals’ products. Sales plunged in the fourth quarter to $480.3 million from $942.3 million a year earlier.
Widmar is calling 2017 a transition year, and he increased his forecast for sales this year to $2.8 billion to $2.9 billion, up from earlier guidance of $2.5 billion to $2.6 billion. The company expects a loss for the year of 5 cents to 80 cents a share, compared with the prior forecast ranging from a loss of 10 cents a share to profit of 45 cents.