Evergreen Solar Inc. (NASDAQ: ESLR): Q4 Earnings Preview 2010

Evergreen Solar Inc. (NASDAQ: ESLR) is scheduled to release its fourth quarter after the closing bell on Wednesday, March 9, 2011. Analysts, on average, expect the company to post a loss of 77 cents a share on revenue of $98.63 million. In the year ago quarter, the company posted a loss of $2.88 per share on revenue of $74.55 million.

Evergreen Solar, Inc. engages in the development, manufacture, and marketing of solar power products primarily in the United States and Europe. It utilizes its proprietary String Ribbon technology process to produce multi-crystalline silicon wafers by growing thin strips of multi-crystalline silicon that are then cut into wafers. The technology significantly reduces the amount of silicon used in a solar panel. 

The firm has lost $54 million through the first nine months of 2010. The company has had warnings from Nasdaq over delisting, painful debt restructuring plans and numerous successive money losing quarters. 

In the preceding third-quarter, loss was $27.2 million, or 13 cents per share, compared to a loss of $82.7 million, or 40 cents per share, in the prior-year quarter. Revenue increased to $86.5 million from $77.7 million. Analysts, on average, expected the company to post a loss of 11 cents per share on revenue of $87.48 million.

The company recently announced that it had amended a key part of its recapitalization plan. The firm said that it lowered the conversion price on new 4 percent convertible subordinated additional cash notes due 2020, which the company is seeking to exchange for 4 percent senior convertible notes due 2013. The initial conversion price of the new notes has been cut from $6 to $4.35 per share, Evergreen said. The company also extended the deadline for the exchange offers from Jan. 31 to Feb. 9. The offers are a central component of Evergreen’s plan to substantially reduce its debt and interest expenses. 

The company faces significant headwinds due to start-up costs, capital expenditures and subsidy cuts in Germany, the world's largest market. The company generates bulk of its revenue from key European markets like Germany and Spain.

Also, Evergreen Solar has faced intense competition in the market for solar power products, particularly from Chinese manufacturers. The company is working to outsource its panel assembly operation from Devens, Mass., to China as a way to cut costs, and expects a new company-owned plant in China to be fully operational making solar wafers by the end of the year. The company said that it would close its Devens, Massachusetts factory and cut 800 jobs to preserve cash as its products face stiff competition from cheaper Chinese rivals. The facility, which began producing solar panels in 2008, will shut down by the end of the first quarter. The company said that it is "no longer economically feasible" to operate the manufacturing facility in a "high-cost market in a period of rapidly declining prices."

Evergreen will record non-cash charges in the fourth and first quarters of $340 million to write off the building and its equipment. It is also reviewing $150 million of prepayments associated with silicon contracts to determine whether additional charges are required.

Evergreen Chief Executive Michael El-Hillow recently said that increases in solar panel production in low-cost regions such as China combined with reductions in government subsidies in key European markets would pressure prices throughout this year. Evergreen's average selling prices dropped 10 percent in December. "The United States will continue to be at a disadvantage from a manufacturing standpoint," El-Hillow said in a statement.

On the bright side, the company is likely to benefit from geographically diversified contractual backlog, improving operating efficiencies, ongoing expansion programs and shifting a part of its manufacturing process to China. 

During the quarter in review, the company implemented the previously approved 1-for-6 reverse stock split.

Full Disclosure: None.

Evergreen Solar (NASDAQ: ESLR): Q3 Earnings Preview 2010

Evergreen Solar Inc. (NASDAQ: ESLR) is scheduled to release its third quarter after the closing bell on Monday, November 1, 2010. Analysts, on average, expect the company to report a loss of 11 cents a share on revenue of $87.48 million. In the year ago quarter, the company posted a loss of 40 cents per share on revenue of $77.66 million.

Evergreen Solar, Inc. engages in the development, manufacture, and marketing of solar power products primarily in the United States and Europe. It utilizes its proprietary String Ribbon technology process to produce multi-crystalline silicon wafers by growing thin strips of multi-crystalline silicon that are then cut into wafers.

In the preceding second quarter, the Marlborough, Massachusetts based-company's net loss was $3.3 million or 2 cents per share, compared to a loss of $20.59 million or 11 cents per share in the year-earlier quarter. Revenue jumped 24% to $84.5 million from $62.70 million. Analysts, on average, expected the company to post a loss of 11 cents per share on revenue of $7, to Wuhan, China.

The company is likely to benefit from geographically diversified contractual backlog, improving operating efficiencies, ongoing expansion programs and shifting a part of its manufacturing process to China. 

The company is shifting production of solar fabrication and assembly from its factory in Devens, Masachussets, to  China in order to lower manufacturing costs. The company expects to achieve a cost of about $1.20 per watt by the end of 2011 with a hybrid Devens/China model.  Improvements from oits current cost of $1.94 per watt will come through further operating efficiencies, additional reductions in material costs, including silicon, and the transition of its Devens panel assembly to China. During the second quarter, small quantities of cells produced in Devens were shipped to China to begin fabricating panels. The company expects to gradually increase the number of cells sent to China through the rest of this year and into next year and complete the transition of Devens’ panel fab to China by mid-2011. Evergreen Solar expects to reach a manufacturing cost of sub-$1 per watt by the end of 2012.

In near-term, the company faces significant headwinds due to start-up costs, capital expenditures and subsidy cuts in Germany, the world's largest market. The company generates bulk of its revenue from key European markets like Germany and Spain. In the second quarter, Evergreen Solar sold approximately 84% of its product in Europe, 14% in U.S. and 2% in Asia.

In September, the company announced the appointment of Michael El-Hillow as President and Chief Executive Officer. He replaced Richard Feldt, who accepted the position of Chief Executive Officer with a privately-held company.

In terms of stock performance, Evergreen Solar shares have lost almost 47 percent over the past year.

Full Disclosure: None.

Evergreen Solar Inc. (NASDAQ: ESLR): Q1 Earnings Preview

Evergreen Solar Inc. (NASDAQ: ESLR) is scheduled to release its first-quarter financial results after the closing bell on Tuesday, May 4, 2010. Analysts, on average, currently expect the company to report a loss of 8 cents a share on revenue of $74.61 million. In the year ago quarter, the company posted a loss of 40 cents per share on revenue of $55.81 million.

Evergreen Solar, Inc. engages in the development, manufacture, and marketing of solar power products primarily in the United States and Europe. It utilizes its proprietary String Ribbon technology process to produce multi-crystalline silicon wafers by growing thin strips of multi-crystalline silicon that are then cut into wafers.

The solar industry has undergone significant changes in the past few years. The industry suffered heavily during recession as 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. Moreover heightened competition from Chinese solar companies too has impacted the US solar industry.

In the preceding fourth quarter, the Marlborough, Massachusetts based-company posted a loss of $98.14 million or $0.48 per share, in comparison with a loss of $53.82 million or $0.33 per share in the previous year quarter. Quarterly total revenues rose to $74.55 million from $44.19 million in the same quarter a year-ago. Analysts, on average, expected the company to report a loss of $0.09 a share on revenue of $74 million for the quarter.

Last month, the company said that shipments for the first quarter of 2010 increased to a new company record of approximately 35.4 megawatts. Revenues for the quarter were approximately $78.5 million and average selling price was approximately $2.20 per watt. Manufacturing costs were about $2.05 per watt, which is consistent with the fourth quarter of 2009. The average selling price in the first quarter declined about 4 percent to $2.20 per watt, mostly due to the stronger US dollar. Evergreen said its manufacturing costs were $2.05 per watt, flat with the fourth quarter.

The company expects production and sales to increase to between 37 to 38 megawatts for the second quarter of 2010.

Richard M Feldt, Chairman, CEO and President of Evergreen, said in April that the company's progress in Wuhan, China is on schedule and it expects to begin production in mid 2010. "I am particularly pleased to report that we produced our first wafers from Quad furnaces initially being used for training purposes, which were installed in Wuhan in mid-March,” Feldt said.

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.

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.

In terms of stock performance, Evergreen Solar shares have lost almost 47 percent over the past year.

Full Disclosure: None.

Evergreen Solar Inc. (NASDAQ: ESLR): Q4 Earnings Preview 2009

Evergreen Solar Inc. (NASDAQ: ESLR) is scheduled to release its fiscal fourth-quarter 2009 financial results after the closing bell on Monday, February 8, 2009. Analysts, on average, expect the company to report a narrower loss of 9 cents a share on revenue of $74 million. In the year ago period, the solar firm posted a loss of 32 cents per share on revenue of $44.19 million.

Evergreen Solar, Inc. engages in the development, manufacture, and marketing of solar power products primarily in the United States and Europe. It utilizes its proprietary String Ribbon technology process to produce multi-crystalline silicon wafers by growing thin strips of multi-crystalline silicon that are then cut into wafers.

Last year, solar industry suffered heavily as 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. Moreover heightened competition from Chinese solar companies too has impacted the US solar industry.

In November, the Marlborough, Massachusetts based-company posted a third quarter loss of $82.4 million or $0.40 per share, compared to a loss of $24.6 million or $0.19 per share in the year-ago period. Quarterly revenue surged to $77.7 million, compared to $22.1 million in last year period. Analysts, on average, expected the company to report a loss of $0.08 per share on revenue of $73.86 million.

Though shipments jumped 35% to to 31.3 megawatts from prior quarter's 23.2 megawatts, the company expects demand to moderate during the latter part of the fourth quarter and well into the first, reflecting industry seasonality.

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. 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.

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.

In terms of stock performance, Evergreen Solar shares have lost almost 33 percent over the past year.

Full Disclosure: None.