GT Solar (NASDAQ: SOLR): Q4 Earnings Preview 2011

GT Solar International, Inc. (NASDAQ: SOLR) is scheduled to release its fourth-quarter earnings after the closing bell on Monday, May 23, 2011. Analysts, on average, expect the company to report earnings of 34 cents per share on revenue of $223.64 million. In the year ago period, the company reported earnings of 23 cents per share on revenue of $194.68 million.

The company has 3 business segments - Polysilicon business, Photovoltaic business and Sapphire business. China accounts for a major part of the company's revenue - making up 62%, followed by Europe's 17% share, Korea's 13%, other Asian countries make up 6% while the U.S. accounts for 2%. ( data according to fiscal 2010 Annual Report).

In the preceding third-quarter, the Merrimack, New Hampshire-based company's net income was $63.58 million, or 46 cents per share, from $36.77 million, or 25 cents per share, in the year-earlier quarter. Revenue jumped to $262.90 million from $173.56 million in the comparable quarter a year ago. Analysts, on average, expected the company to report earnings of 38 cents per share on revenue of $251.91 million.

At its last earnings call in February, the company raised its fiscal year 2011 guidance for revenue to a range of $835 million to $860 million, up from the previously provided range of $775 million to $850 million. Earnings per share are now expected to be in the range of $1.15 to $1.19, up from the previously provided range of $1.08 to $1.18. 

For fiscal year 2012, the company expects revenue in the range of $850 million to $1 billion, and earnings in the range of $1.25 to $1.50 per share. 

The company has benefited from robust demand from photovoltaic customers and the buildup of potential orders in its newly acquired sapphire busines. GT Solar has won a flurry of orders in recent months, and the firm had said in December 2010 that it expects the sapphire business to be one of its key drivers in 2011. At its last earnings call, GT Solar announced an enhancement to the advanced sapphire furnace that will increase the output capacity to 100 kilograms per cycle.

Rwecently, the company  signed its largest polysilicon equipment deal -- and largest single deal in company history -- with South Korean polysilicon giant OCI. The order for polysilicon manufacturing equipment will be included in GT Solar's backlog for the quarter ending July 2. Last month, GT Solar received an order for its advanced sapphire crystallization furnaces totaling $218.9 million from Guizhou Haotian Optoelectronics Technology Co. LTD. The order marks HTOT's entrance into the fast-growing LED industry, and continues GT Solar's market momentum for its sapphire crystalline growth technology based on its advanced sapphire furnace. The order will be included in GT Solar's backlog for its current first quarter, FY12, which ends on July 2, 2011. In February, the company received an order valued at over $41 million for its advanced sapphire crystallization furnaces. 

The solar industry is expected to experience a year of slowing growth in 2011, and while equipment makers like GT Solar are viewed by many as defensive plays for a period of uncertainty, it's a positive that GT Solar is having initial success in the LED market, and with a major customer, demonstrating the cross-selling potential.

Full Disclosure: None.

GT Solar International Inc. (NASDAQ: SOLR): Q3 Earnings Preview 2010

GT Solar International, Inc. (NASDAQ: SOLR) is scheduled to release its third-quarter earnings after the closing bell on Wednesday, February 2, 2011. Analysts, on average, expect the company to report earnings of 38 cents per share on revenue of $251.91 million. In the year ago period, the company reported earnings of 25 cents per share on revenue of $173.56 million.

The company has 3 business segments - Polysilicon business, Photovoltaic business and Sapphire business. China accounts for a major part of the company's revenue - making up 62%, followed by Europe's 17% share, Korea's 13%, other Asian countries make up 6% while the U.S. accounts for 2%. ( data according to fiscal 2010 Annual Report).

In the preceding fiscal second-quarter, the Merrimack, New Hampshire-based company's net income was$42.78 million or $0.28 per share compared to $9.43 million or $0.06 per share in the previous year. Revenue more than doubled to $229.29 million from $104.19 million a year ago. Analysts, on average, expected the company to report earnings of $0.24 per share on revenue of  $199.18 million. As of October 2, 2010, the company's backlog was $1.16 billion, with $544.6 million in the polysilicon segment, $601.1 million in the PV segment and $13.0 million in sapphire materials. Included in the total backlog was $296.8 million of deferred revenue.

In December,  the company boosted its full-year earnings and agreed to repurchase shares from private investors for about $203 million. The supplier of equipment to solar manufacturers agreed to buyback 26.5 million shares of its common stock held by GT Solar Holdings, which is controlled by the co.’s private equity investors, GFI Energy Group and Oaktree Capital Management. GT Solar lifted its earnings per share guidance for fiscal year 2011 to a range of $1.08 to $1.18, up from the range of $1.00 to $1.10.  Full year revenues are expected to range from $775 million to $850 million.

Also in December, the company said that it continues to talk with other potential customers in the Asia region and believes it is on track to meet its projected $100 million in revenue for its fiscal year 2012 from sapphire crystallization equipment sales.

The company has benefited from robust demand from photovoltaic customers and the buildup of potential orders in its newly acquired sapphire busines. GT Solar has won a flurry of orders in recent months, and the firm had said in December it expects the sapphire business to be one of its key drivers in 2011.

Last month, GT Solar received an order worth $47.3 million for its current generation SDR400 CVD reactors from OCI Company Ltd., a South Korean polysilicon producer. The order was included in GT Solar's backlog for its fiscal 2011 third quarter, which ended on January 1.

Earlier this month, the company was awarded a contract valued at $37.5 million by Korea-based PV manufacturer Nexolon Company, Ltd. for the new DSS650 multicrystalline ingot growth systems. The contract will be included in GT Solar's backlog for the fiscal 2011 fourth quarter, which ends on April 2.

On January 20, GT Solar received yet another order worth $33.3 million for sapphire crystallization furnaces from OCI Company Ltd. This order will also be included in the fiscal 2011 fourth quarter backlog.

The solar industry is expected to experience a year of slowing growth in 2011, and while equipment makers like GT Solar are viewed by many as defensive plays for a period of uncertainty, it's a positive that GT Solar is having initial success in the LED market, and with a major customer, demonstrating the cross-selling potential.

Full Disclosure: None.

GT Solar (NASDAQ: SOLR): Q4 Earnings Preview

GT Solar International, Inc. (NASDAQ: SOLR) is scheduled to release fiscal fourth-quarter earnings after the market close on Wednesday, May 19, 2010. Analysts, on average, expect the company to report earnings of 19 cents per share on revenue of $183.01 million. In the year-ago period, the company reported earnings of 8 cents per share on revenue of $138.54 million.

GT Solar International, Inc. engages in the design and manufacture of manufacturing equipment; and provision of services for the production of photovoltaic, wafers, cells and modules, and polysilicon worldwide.

In the preceding fiscal-third quarter, the Merrimack, New Hampshire-based company reported net income was $36.77 million or $0.25 per share, compared to $43.12 million or $0.30 per share in the year-ago period. Revenue for the third quarter totaled $173.56 million, compared to $205.21 million in the prior year period.  Analysts, on average, expected the company to report earnings of 15 cents per share on revenue of $145.40 million. Gross margin improved sequentially to 44.2% from 32.9% in prior quarter.

For the fiscal year 2010, the solar equipment maker expects to report revenue in the range of $500 million to $550 million and earnings per share in the range of $0.52 to $0.60. GT Solar said in February that it is on track to achieve gross margin for the fiscal year of approximately 39%.

For fiscal 2011, the company expects revenue in the range of $400 million to $600 million and earnings per share in the range of $0.30 to $0.60.

Late in April, the company released a new high performance ingot growth furnace for the solar industry providing 15% increased throughput, energy efficiency and higher quality.

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.

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, GT Solar shares have gained 1% over the past year.

Disclosure: Author doesn’t own any of the stocks discussed here.