German solar cell manufacturer, Q-Cells SE (QCE.DE) is reducing its forecast for the 2008 financial year due to what it called "short notice unexpected developments."
The company said over recent days, the uncertainty and the weakening market demand arising from the financial crisis have resulted in a number of Q-Cells’ customers postponing agreed deliveries until next year. These volumes could not be placed elsewhere at short notice.
Shares of the company’s stock dropped sharply in morning trading on Frankfurt exchange, but rebounded in the afternoon to close down 16% at EUR 22.38.
In response to these changes in market conditions, Q-Cells said it intends to use the Christmas and New Year period to perform maintenance work and reduce overtime balances. Accordingly, the production volume in the Company’s core business for the year as a whole will now amount to around 570 MWp (previously expected around 585 MWp).
Consolidated sales revenues will total around EUR 1.225 billion (previous forecast: EUR 1.35 billion), while operating income (EBIT) in the core business is expected to amount to approximately EUR 230 million, with consolidated EBIT expected to be approximately EUR 205 million (previous forecast for the group: EUR 260 million).
Including the expected contribution to income from Renewable Energy Corporation (REC), the Company is aiming to generate net income for the period of around EUR 185 million (previously EUR 215 million).
Due to the deterioration in project financing conditions and the uncertain market situation, Q-Cells SE expects demand to remain weak into early 2009, the company said.
Accordingly, the Company is forecasting total production in 2009 of between 800 MW and 1 GW (previously at least 1 GW) and sales revenues of between EUR 1.75 billion and EUR 2.25 billion (previously around EUR 2.25 billion), corresponding to a growth of sales revenues of at least 40%.
Due to the increasingly attractive return of photovoltaic systems, the company expects market demand to increase at the latest from the second half of 2009 and thus still an unabatedly positive mid-term trend. Q-Cells SE’s investments in 2009 will focus on the expansion of production capacities for crystalline solar cells and majority interests in thin-film companies, the company said.
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