Boston, MA 05/23/2014 (wallstreetpr) – Trina Solar Limited (ADR) (NYSE:TSL) posted its first quarter 2014 financial results with increased shipments of photovoltaic (PV) modules along with downstream business.
Higher Shipments Drive The Margin
In the first quarter, Trina’s total shipments were 558 MW versus 393 MW in 1Q2013 that increased the Company’s net revenues by ~71% to $444.8 million. The significant rise in shipments and revenues was primarily due to increasing volumes as a result of growing demand in China, Japan and the U.S.
Gross profit increased to $91.5 million from $4.4 million due to the contribution of increasing ASP, decrease in costs per watt and sales of 50 MW downstream projects in Wuwei. So, the gross margin during the period was 20.6% versus 1.7% in 1Q2013.
Operating expenses also increased by ~20% year over year to $53.3 million that represented 12% of net revenues. But, the growing trends in revenue improved the operating income to $38.2 million from an operating loss of $40.1 million in 1Q2013 and so, the operating margin rose to 8.6% in 1Q2014. Consequently, net income of Trina Solar improved to $26.5 million with net margin of 6%.
Financial Condition
Trina Solar Limited (ADR) (NYSE:TSL) is financially sound to expand manufacturing capacity to target key growth markets. As of March 31, 2014, Trina had cash balances of $577.7 million and total bank borrowings of $982.5 million with shareholders’ equity of $848 million. Total working capital during the period was $23.8 million.
Growth Prospects
Going forward, Trina expects growth in shipments with growing demand from the emerging markets such as Singapore, Chile, South Africa and Jordan and high ASP countries like China and the U.S.
Therefore, Trina Solar Limited (ADR) (NYSE:TSL) expects total shipments of 950 MW – 1,010 MW with 150 MW to 170 MW of downstream projects during 2Q2014 and total shipments of 3.6 GW to 3.8 GW, including 400 MW and 500 MW shipments for downstream projects in FY2014. In addition, the expected stability in poly silicon prices may help the Company to maintain its gross margin.
