Yingli Green Posts Loss But Sees Pickup in Demand

By TESS STYNES
Yingli Green Energy Holdings Co. swung to a second-quarter loss amid a steep drop in revenue; losses on derivative liabilities and debt extinguishment; and slumping prices for its solar-energy products.
But Chairman and Chief Executive Liansheng Miao said shipments soared sequentially amid improved project financing and a pickup in demand in its markets, especially Germany. The company also is optimistic about rapidly growing demand for solar energy in China.
The Chinese maker of photovoltaic products said previously it believed this year's first quarter marked a low for the solar industry, which struggled late last year and early this year on the drop in demand and tight credit. The sector is poised to benefit from favorable U.S. and Chinese government policies, but that isn't expected to solve the near-term issue of oversupply.
Yingli Green reported a loss of 393.7 million yuan ($57.6 million), or 3.03 yuan an American depositary share, compared with a prior-year profit of 203.9 million yuan, or 1.57 yuan an ADS.
The latest period included a 204.2 million yuan loss on derivative liabilities and a 244.8 million yuan loss on debt extinguishment. Excluding items, earnings per ADS were down at 0.91 yuan from 1.81 yuan.
Revenue decreased 25% to 1.49 billion yuan from a year earlier, though Yingli reported sequential growth of 50% as shipments soared 72% from the prior quarter.
Gross margin tumbled to 18.3% from 25.8% a year earlier, though it improved from 15.3% in the prior quarter amid lower polysilicon prices and usage.
Yingli Green affirmed its May forecast for 2009 shipments of 450 megawatts to 500 megawatts.
Write to Tess Stynes at tess.stynes@dowjones.com