NANJING, China, June 17, 2011 /PRNewswire/ --
- Expresses Confidence in Ability to Recover
China Sunergy Co., Ltd. (Nasdaq: CSUN) ("China Sunergy" or "The Company"), a specialized solar cell and module manufacturer, today announced updates to its guidance for the second quarter of 2011 and full year 2011.
China Sunergy expects its solar module shipments in the second quarter to be between 100 and 110 MW, compared to the Company's previous guidance of between 120MW and 130MW. The Company delayed some of its shipments to July, in line with the Company's credit control policy, as a result of delays in the approval of project loans to some of Company's customers in Europe.
For the full year 2011, the Company now expects its solar module shipments to be between 580MW and 600MW, compared to the Company's previous guidance of between 670MW and 690MW. The more conservative guidance reflects that financing delays are becoming more common and may even result in some order cancellations, and therefore the Company may not be able to complete as many transactions as it had forecasted, despite robust demand.
For the second quarter of 2011, the Company expects its overall gross margin to be approximately 1%, compared to Company's previous guidance of between 7.5% and 8.5%; gross margin relating to the Company's in-house module production is expected to be approximately 3%, compared to Company's previous guidance of between 12% and 13%.
The lowered margin guidance reflects a number of short-term factors, including a higher proportion of higher-cost inventory in projected second quarter shipments, an increase in non-silicon costs due to an increase in the cost of silver paste, and a faster than expected drop in solar module average selling price (ASP).
The outlook for the second quarter and full year of 2011 reflects the Company's current estimates based on the conditions and trends known to the Company as of the date of this press release. Results are subject to changes based on further review by management and future changes in market and operating conditions.
Mr. Stephen Cai, the Chief Executive Officer of CSUN, commented, "In the interest of transparency and best practices, we wanted to give the market ample notice that our second quarter results will be substantially lower than previously forecasted. However, the sales we will not realize in Q2 will be realized in Q3. We are in this business for the long run and we believe in the long-term market growth for our products. Our procurement strategy has a great deal of flexibility built into it and we will do our best to deal with any volatility in the industry."
About China Sunergy Co., Ltd.
China Sunergy Co., Ltd. is a specialized manufacturer of solar cell and module products in China. China Sunergy manufactures solar cells from silicon wafers, which utilize crystalline silicon solar cell technology to convert sunlight directly into electricity through a process known as the photovoltaic effect, and assembles solar cells into solar modules. China Sunergy sells these solar products to Chinese and overseas module manufacturers, system integrators, and solar power systems for use in various markets. For more information, please visit our website at http://www.chinasunergy.com.
Investor and Media Contacts: China Sunergy Co., Ltd. Elaine Li Phone: +86-25-5276-6696 Email: Elaine.firstname.lastname@example.org Brunswick Group Hong Kong Hong Kong Ginny Wilmerding Xiaoxiao Nina Zhan Phone: +852-3512-5000 Phone: +852-3512-5000 Email: email@example.com Email: firstname.lastname@example.org
Safe Harbor Statement
This announcement contains forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical facts in this announcement are forward-looking statements. These forward-looking statements are based on current expectations, assumptions, estimates and projections about the Company and the industry, and involve known and unknown risks and uncertainties, including but not limited to, the Company's ability to raise additional capital to finance the Company's activities; the effectiveness, profitability, and the marketability of its products; litigations and other legal proceedings; the economic slowdown in China and elsewhere and its impact on the Company's operations; demand for and selling prices of the Company's products, the future trading of the common stock of the Company; the ability of the Company to operate as a public Company; the period of time for which its current liquidity will enable the Company to fund its operations; the Company's ability to protect its proprietary information; general economic and business conditions; the volatility of the Company's operating results and financial condition; the Company's ability to attract or retain qualified senior management personnel and research and development staff; future shortage or availability of the supply of raw materials; impact on cost-competitiveness as a result of entering into long-term arrangements with raw material suppliers and other risks detailed in the Company's filings with the Securities and Exchange Commission. The Company undertakes no obligation to update forward-looking statements to reflect subsequent occurring events or circumstances, or to changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward looking statements are reasonable, they cannot assure you that their expectations will turn out to be correct, and investors are cautioned that actual results may differ materially from the anticipated results.
SOURCE China Sunergy Co., Ltd.