Yingli Green Energy (NYSE: YGE): Q1 Earnings Preview 2011

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE) is scheduled to release its first-quarter earnings before the opening bell on Friday, May 20, 2011. Analysts, on average, expect the company to report earnings of 39 cents per share on revenue of $573.46 million. In the year ago period, the company reported earnings of 18 cents per share on revenue of $358.92 million.

Yingli Green Energy Holding Company Limited is a vertically integrated photovoltaic (PV) product manufacturer. The Company designs, manufactures and sells PV modules, and designs, assembles, sells and installs PV systems.

In the preceding fourth-quarter, the Baoding, China based company's net income was $84 million, or 52 cents per American Depositary Share (ADS), compared with a loss of $6.6 million, or 4 cents per ADS. On an adjusted basis, the company earned 57 cents per ADS in the fourth quarter. Revenue jumped 65 percent to $616.1 million from $370.77 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 44 cents per share on revenue of $544.36 million.

Solar industry as a whole has benefited from continued strong demand thanks to growing awareness about global warming, skyrocketing oil prices, cheap financing and technological advances. Companies involved in the production of semiconductors used in solar panels have enjoyed a positive quarter. Many have experienced rising shipments over the last few quarters, resulting in a sequence of record quarters. The world is becoming increasingly environmentally conscious. Both commercial and private demand for solar power is rising. Solar options are becoming more attractive as more governments provide better options for buildings producing solar power to feed into and out of the grid as required. US President Barack Obama has called for 80 percent of the nation's electricity to come from clean sources by 2035. Meanwhile, China has doubled its target for installed photovoltaic power capacity over the next five years to 10 gigawatt by 2015. The government has also raised its installed solar capacity target for 2020 to 50 GW, up from the previous goal of 20 GW.

Thanks to better cost advantages, Chinese solar module maker have grabbed more market share from their international competitors. Local solar companies have also benefited from China's well-developed supply chain, cheap electricity, supportive policies and even low environmental standards.

However, the solar industry relies on government incentives to make electricity created by the sun competitive with sources such as coal and natural gas. Many governments, particularly in Europe, have implemented generous subsidies for solar power in recent years as they seek to reduce their reliance on fossil fuels and combat climate change. Late in February, German lawmakers passed a law, cutting solar power subsidies by up to 15 percent from this summer, six months ahead of schedule, dealing a blow to the world's biggest photovoltaic market. Similarly, Italy’s government recently approved a decree that reduces incentives to solar projects. The Italian solar market became the second-largest in Europe following Germany last year after the government offered the highest feed-in tariffs in the region.

The company recently revised its shipment outlook for first-quarter 2011. The company now anticipates shipments to decline sequentially compared to its earlier guidance of a sequential rise. It also trimmed the gross margin outlook. Yingli Green Energy expects to report that shipment in the first quarter decreased by a low teen percentage from the fourth quarter 2010, and gross margin will be in the estimated range of 27% to 27.5%. This compares to the Company's previously provided guidance for the first quarter of 2011 that shipment would increase by mid-single digit percentage quarter over quarter and gross margin would be in the range of 30% to 31%.

The company said that it expects a lower shipment compared to the previous quarter primarily due to the policy change in Italy. In addition, the severe weather conditions in Germany this past winter also had a negative effect on the market demand for solar products in the first quarter of 2011. The Company expects to deliver certain of the delayed orders in the second quarter of 2011 and estimates that shipments in the second quarter of 2011 will increase by more than 30% over the first quarter of 2011. The company also reaffirmed its PV module shipment target to be in the estimated range of 1,700 MW to 1,750 MW for fiscal year 2011, which represents an increase of 60.1% to 64.8% compared to fiscal year 2010.

Full Disclosure: None.

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE): Q4 Earnings Preview 2010

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE) is scheduled to release its fourth-quarter earnings before the opening bell on Friday, February 18, 2011. Analysts, on average, expect the company to report earnings of 44 cents per share on revenue of $544.36 million. In the year ago period, the company reported earnings of 9 cents cents per share on revenue of $370.77 million.

Yingli Green Energy Holding Company Limited is a vertically integrated photovoltaic (PV) product manufacturer. The Company designs, manufactures and sells PV modules, and designs, assembles, sells and installs PV systems.

In the preceding third-quarter, the Baoding, China based company's net income was $68.2 million, or 44 cents per American Depository share (ADS), compared with a profit of $17.7 million, or 12 cents per ADS, in the year-ago quarter. On an adjusted basis, the company earned 53 cents per ADS in the latest quarter. Revenue jumped 50 percent to $490.9 million from $325.98 million in the same quarter last year. Analysts, on average, expected the company to report earnings of 36 cents per share on revenue of $477.31 million. 

At its last earnings call in November, the Company raised its PV module shipment target to the estimated range of 1,020 MW to 1,040 MW from the previous estimated range of 950 MW to 1,000 MW for fiscal year 2010, which represents an increase of 94.2% to 98.0% compared to fiscal year 2009. The net revenue for full year 2010 is estimated to be in the range of $1.78 billion to $1.81 billion. In addition, based on the strong gross margin performance in the first three quarters of 2010, the estimated ramp-up cost of Fine Silicon and the 400 MW of new production lines which started initial operation in July 2010, the expected average selling price of PV modules and forecasted exchange rates of the euro and U.S. dollar against the Renminbi, the company further raised its gross margin target to the estimated range of 32.0% to 32.5% from the recently raised estimated range of 31% to 32% for fiscal year 2010. However, the company told investors margins could fall in the next few quarters as it ramps up polysilicon facilities, Acaro said. Polysilicon is the solar industry's key raw material. The company forecast that average selling prices would be flat in the first half of 2011 and show a slight decline in quarters three and four. Shipments during 2011 should see a growth and in developing markets such as southern Europe, the U.S. and China.

Yingli is looking to enhance the conversion efficiency of its monocrystalline cells to 20% by 2012 and 22% by 2015. The expansion is set to fall back on the developments through Yingli’s Panda project, N-type-metal-wrap-through and heterojunction with intrinsic thin-layer cell technology.  Yingli expects to increasemulti-crystalline cell conversion efficiency to 17.5% in 2011, 18% in 2012 and 20% in 2015.

Xiong also commented on Yingli’s multi-crystalline cell conversion efficiency with a continued goal to progress to 17.5% in 2011, 18% in 2012 and 20% in 2015.

Yingli has a broad customer base, not only from US and Europe companies - which are Yingli's principal markets - but also from emerging markets in Asia and Africa. Yingli is on track for about a 10 percent share of the U.S. solar modules market by volume this year, and if it meets forecasts, would vault the company among the top U.S. suppliers.

Recently, the company signed an agreement with Borrego Solar Systems to supply the San Diego-based company 20 megawatts of photovoltaic (PV) modules in 2011. 

In December, the company said that it would supply about 190 megawatts of photovoltaic panels to project developers under China's program to build solar plants. Yingli said it would sell about 70 percent of the modules that turn sunlight into electricity to project developers under China's "Golden Sun Program," which has announced a 272 MW of projects. Most of Yingli's shipments will take place in the second half of 2011, and will receive a 70 percent subsidy from the Ministry of Finance.  China is in the midst of a solar energy drive that is on track to make China the world’s largest solar market by 2014.

2010 continued the significant growth of the solar market with new markets in China and the USA advancing their demand for solar panels. Solar industry as a whole has benefited from continued strong demand thanks to growing awareness about global warming, skyrocketing oil prices, cheap financing and technological advances. Companies involved in the production of semiconductors used in solar panels have enjoyed a positive quarter. Many have experienced rising shipments over the last few quarters, resulting in a sequence of record quarters. The world is becoming increasingly environmentally conscious. Both commercial and private demand for solar power is rising. Solar options are becoming more attractive as more governments provide better options for buildings producing solar power to feed into and out of the grid as required.

Last month, US President Barack Obama in his State of the Union address called for 80 percent of the nation's electricity to come from clean sources by 2035. Meanwhile, Senator Bernie Sanders submitted a bill to congress titled the "10 Million Solar Roofs and 10 Million Gallons of Solar Hot Water Act". This bill is expected to spur alternative energy growth and create green jobs.

Thanks to better cost advantages, Chinese solar module maker have grabbed more market share from their international competitors. Local solar companies have also benefited from China's well-developed supply chain, cheap electricity, supportive policies and even low environmental standards. More than 90 percent of domestic Chinese manufacturers sell their products overseas currently, especially in Europe, where the solar electricity industry is more mature.

Full Disclosure: None.

Yingli Green Energy (NYSE: YGE): Q3 Earnings Preview

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE) is scheduled to release its third-quarter earnings before the opening bell on Friday, November 19, 2010. Analysts, on average, expect the company to report earnings of 34 cents per share on revenue of $465.55 million. In the year ago period, the company reported earnings of 12 cents cents per share on revenue of $325.98 million.

Yingli Green Energy Holding Company Limited is a vertically integrated photovoltaic (PV) product manufacturer. The Company designs, manufactures and sells PV modules, and designs, assembles, sells and installs PV systems.

In the preceding second-quarter, the Baoding, China based company's net income was $32.1 million, or 21 cents per share, compared to a loss of $57.6 million, or 44 cents a share, in the year-earlier quarter. On an adjusted basis, the company earned 25 cents per share in the latest quarter. Revenue surged 81 percent to $398.1 million. Analysts, on average, expected the company to report earnings of 19 cents per share on revenue of $371.13 million. 

The company expects a mid-20% increase in shipments quarter over quarter in the third quarter of 2010, in line with its previous estimates. With better than expected average selling price and improving operating efficiency of its new 400 MW production lines, the company is confident in achieving a 31% to 32% gross margin in the third quarter of 2010, compared to the previous estimated range of 28% to 30%. Based on the strong performance in the first three quarters of 2010 and more clear visibility for the fourth quarter, the company expects its gross margin for 2010 to reach 31% to 32%, compared to the previous estimated range of 28% to 30%.

The company expects to increase conversion efficiency of its mono-crystalline cell to 20% in 2012 and 22% in 2015. Yingli expects to increasemulti-crystalline cell conversion efficiency to 17.5% in 2011, 18% in 2012 and 20% in 2015.

Yingli Americas expects to exit 2010 with an approximately 10% market share and anticipates achieving a similar or better level in 2011. 

As of October 30, 2010, the company had secured 575 MW of purchase under legally binding sales contracts. The company expects to increase this figure to 1,000 MW by the end of this year. Majority of these sales contracts require prepayment from customers. Benefited from the robust demand from major solar market, the company sees a flattish trend of average selling price in the fourth quarter of 2010, and expects a stable level in the first half of 2011 and a moderate decrease in the second half of 2011. For the geographies of shipments in 2011, the Company expects to increase shipments to new and emerging markets, such as South Europe, U.S., and China.

Meanwhile, the company has now secured more than 60% of its expected polysilicon needs for 2011 through long-term contracts and in-house polysilicon production, and expects to increase this figure to approximately 70% by the end of this year.

Solar industry as a whole has benefited from continues strong demand due to growing awareness about global warming, skyrocketing oil prices, cheap financing and technological advances. Thanks to better cost advantages, Chinese solar module maker have grabbed more market share from their international competitors. Local solar companies have also benefited from China's well-developed supply chain, cheap electricity, supportive policies and even low environmental standards. 

The company's stock currently trades at a forward P/E  (fye Dec 31, 2011) of 7.46 and PEG Ratio (5 yr expected) of 0.37. In terms of stock performance, Yingli Green shares have lost nearly 30% since the beginning of the year.

Full Disclosure: None.

Yingli Green Energy (NYSE: YGE): Q1 Earnings Preview

Yingli Green Energy Holding Co. (NYSE: YGE), China's second-largest solar panel maker, is scheduled to release its first-quarter financial results before the market open on Monday, May 24, 2010. Analysts, on average, expect the company to report earnings of 22 cents per share on revenue of $353.89 billion. In the year ago quarter, the company reported a loss of 16 cents per share on revenue of $146.34 million.

Yingli Green Energy Holding Company Limited and its subsidiaries engage in the design, development, marketing, manufacturing, installation, and sale of photovoltaic (PV) products in the People's Republic of China and internationally.

In the preceding fourth quarter, the Baoding, China-based company reported that it slipped to a loss of RMB 44.84 million or RMB 0.3 per share compared to a profit of RMB 82.04 million or RMB 0.64 per share last year. In dollar terms, loss per share was $0.04. RMB 44.8 million or US$6.6 million, compared to net income of RMB 82.0 million in the fourth quarter of 2008. Loss per ordinary share and per ADS was RMB 0.30 or US$0.04, compared to net income of RMB 0.64 in the fourth quarter of 2008. On an adjusted non-GAAP basis, net income was RMB 137.5 million or US$20.2 million, compared to RMB 111.4 million in the fourth quarter of 2008. Adjusted non-GAAP earnings per ordinary share and per ADS were RMB 0.89 or US$0.13 in the fourth quarter of 2009, compared to RMB 0.86 in the fourth quarter of 2008. Total net revenues were RMB 2.53 billion or US$370.8 million, an increase of 43.7% from RMB 1.76 billion in the fourth quarter of 2008. Analysts, on average, expected the company to report earnings of US$0.14 per share on revenues of US$326.46 million for the quarter. PV module shipments for the fourth quarter increased by 15.7% over the previous quarter, and the fourth quarter gross margin continued to improve, reaching 29.6%.

Looking ahead to 2010, the company expects its PV module shipment target to be in the estimated range of 950 MW to 1 GW, which represents an increase of 80.8% to 90.4% compared to fiscal 2009. In addition, the company expects that its gross margin target for fiscal year 2010 to be in the estimated range of 27% to 29%. Yingli's gross margin, which is a proportion of each dollar of revenue retained as gross profit, may reach up to 30 percent in 2011, up from about an average 28 percent estimated for 2010, the company recently said.

The company said it plans to carve out a 12 percent share of the global panel market, which analysts expect to expand by more than 50 percent in 2010 to about 10 to 13 gigawatts. Yingli expects a near doubling of panel shipments to 1,000 megawatts (MW) this year.

Globally, solar industry depends upon government subsidies and incentives and support to remain competitive. However, recent developments suggest that subsidies will inevitably be reduced or phased out. Evergreen Solar sells bulk of its panels in key European markets like Germany and Spain, where generous federal subsidies ensured high electricity rates for solar energy system. In Germany, Solar subsidies for rooftop-installed solar power will see a one-off cut of 16 percent from July, while most open-field installations will be cut by 15 percent.Support for farmland solar systems is to be scrapped completely, according to media reports. Yingli derives over 50 percent of its revenue in Europe.

However, the industry as a whole is likely to benefit from growing attention to global warming, skyrocketing oil prices, cheap financing and technological advances. At the Copenhagen Summit held in December 2009, the five major polluters of the world agreed to take action to reduce CO2 aggressively, with $100B per year pledged to help developing nations adopt green energy technology to cut greenhouse gas. Meanwhile, the US, China, Brazil and India continue to invest heavily in wind and solar energy with China's $454B in the next 5 year period as the most aggressive one. As part of the stimulus bill signed last year, the federal government approved around $60 billion in loan guarantee authority and $30 billion in energy grants for renewable energy and transmission companies. Congress has also granted a 30% renewable-investment tax credit to help expand the development of alternative sources of energy. As of February this year, the industry had gotten Treasury grants worth $81 million. That grant program is scheduled to end Dec. 31. The industry is still hoping that Congress will approve further policies to aid solar.

Thanks to better cost advantages, Chinese solar module maker have grabbed more market share from their international competitors. Local solar companies have also benefited from China's well-developed supply chain, cheap electricity, supportive policies and even low environmental standards. Yingli's non-silicon production costs stand at $0.76 per watt, already the lowest in the industry.

Among other developments, the company recently announced that it has entered into a sales contract to power France's largest PV solar power plant.

In terms of stock performance, Yingli shares are down more than 13% over the past year.

Full Disclosure: None.

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE): Q4 Earnings Preview 2009

Yingli Green Energy Holding Co. Ltd. (NYSE: YGE) is scheduled to release its fiscal fourth-quarter 2009 financial results before the market open on Monday, March 8, 2010. Analysts, on average, expect the company to report earnings of 14 cents a share on revenue of $323.79 million. In the year ago period, the company posted earnings of 12 cents per share on revenue of $258 million.

Yingli Green Energy Holding Company Limited (NYSE: YGE) is a leading solar energy company and one of the world's largest vertically integrated photovoltaic manufacturers. Yingli Green Energy develops, manufactures and sells photovoltaic modules to a wide range of markets, including Germany, Spain, Italy, Greece, France, South Korea, China, and the United States.

In the preceding fiscal-third quarter, the Baoding, China-based company reported that its net income dropped to RMB 120.85 million or RMB 0.79 per ordinary share and per American Depository Shares, or ADS, from RMB 147.63 million or RMB 1.14 per ordinary share and per ADS in the previous year. In dollar terms, earnings were $17.70 million or $0.12 per ordinary share and per ADS. Excluding items, earnings increased to RMB 184.24 million or RMB 1.20 per ordinary share and per ADS from RMB 175.31 million or RMB 1.34 per ordinary share and per ADS in the year-ago period. In dollar currency, non-GAAP earnings was US$ 26.99 million or US$ 0.18 per ordinary share and per ADS. Total net revenues for the period increased to RMB 2.22 billion or US$ 325.98 million from RMB 2.21 billion in the third quarter of the prior fiscal year. Analysts, on average, expected the company to report earnings of $0.17 per ADS on revenue of $ 328.64 million. Shipments increased to more than 80% quarter-over-quarter. Gross margin rose to 20.1%, up from 18.3% in the second quarter.

In November, the company raised it fourth quarter annual PV module shipment target to range between 490 MW and 500 MW from the earlier range of 450 MW to 500 MW.

In the fourth quarter of last year, Yingli won 27% of the commercial and residential installations in the California- the nation's biggest solar market and was the single biggest player, according to Bloomberg New Energy Finance.

The company is trying to lower costs and raise quality through complete vertical integration; it controls the materials in their solar panels from the sand to finished product. Last year, Yingli announced the Project PANDA, a collaboration of Yingli, ECN and Amtech to develop next generation high efficiency solar cells. During the third quarter, Project PANDA has achieved an important milestone. It successfully produced a next generation cell, which has an average efficiency rate of 18% or higher on higher production line.

Thanks to better cost advantages, Chinese solar module maker have grabbed more market share from their international competitors. Local solar companies have also benefited from China's well-developed supply chain, cheap electricity, supportive policies and even low environmental standards. In fourth quarter, Chinese makers won 46% of the new installations in California.

The demand for solar power products has picked up after a difficult 2009, when the turmoil in the credit market forced financial players to abandon U.S. solar energy projects. The 2008 collapse of top solar financier Lehman Brothers and the freeze-up in the global credit markets drove nearly all banks to halt funding for major new solar projects, forcing the makers of systems that turn sunlight into electricity to cut prices for their products and sending their stocks crashing. The problems of solar companies had been further compounded by an oversupply of polysilicon, a material used in solar panels.

The solar industry is poised to benefit from growing attention to global warming, skyrocketing oil prices, cheap financing and technological advances. At the Copenhagen Summit held in December 2009, the five major polluters of the world agreed to take action to reduce CO2 aggressively, with $100B per year pledged to help developing nations adopt green energy technology to cut greenhouse gas. Meanwhile, the US, China, Brazil and India continue to invest heavily in wind and solar energy with China's $454B in the next 5 year period as the most aggressive one. As part of the stimulus bill signed last year, the federal government approved around $60 billion in loan guarantee authority and $30 billion in energy grants for renewable energy and transmission companies. Congress has also granted a 30% renewable-investment tax credit to help expand the development of alternative sources of energy. Last month, Yingli Green Energy Holding Company Ltd. said it has received through its US unit, Yingli Green Energy Americas, Inc., a tax credit of US$4.5 million from the United States Treasury Department, as part of its Recovery Act Advanced Manufacturing Tax Credit program or MITC program, for the company's planned establishment of manufacturing operations in the United States.

In the near term, the solar industry is facing an important challenge in the form of reduced government subsidies. Globally, solar industry depends upon government subsidies and incentives and support to remain competitive. However, recent developments suggest that subsidies will inevitably be reduced or phased out. According to media reports, the German government is planning to cut solar subsidies for new roof and open-field sites from April by 16 percent to 17 percent. Additional cuts to the subsidies will be made from 2011 if solar projects amount to more than 3,000 megawatts, and even more if they total more than 3,500 megawatts. Already, France in January slashed the tariffs for electricity produced from rooftop solar panels by 24 percent. Spain too has taken similar steps.

The company's stock currently trades at a forward P/E (fye 31-Dec-10) of 14.73. In terms of stock performance, Yingli shares have gained nearly 204% over the past year.

Full Disclosure: None.