ReneSola ends Q1 with more cash; debt up from year-end at $959 million

By Lisa Kerner

Charlotte, N.C., May 16 - ReneSola Ltd. ended its first quarter on March 31 with debt of $958.6 million, excluding $111.6 million in convertible notes.

This compares to total debt at year-end of about $790.2 million.

"Total bank borrowings increased by $168.5 million sequentially at the end of the first quarter," said vice president of international corporate finance and corporate communications Tony Hung during the company's earnings conference call on Thursday.

Short-term borrowings for the first-quarter 2013 were $832.8 million, compared to $733.6 million in the fourth quarter of 2012.

"Our net cash and cash-equivalents position plus restricted cash was $442.7 million at the end of the first quarter, an increase from $268.1 million at the end of the fourth quarter, due to the receipt of additional financing and positive operating cash flow, which we expect to continue," Hung said.

ReneSola signed a 15-year loan agreement with China Development Bank in March totaling about $50.9 million, according to Hung.

First-quarter revenues were down 34.4% year-over-year but exceeded company guidance.

"The combination of declining ASPs and lower wafer shipments resulted in revenues of $284.2 million, down 7.3% quarter-over-quarter," said Hung.

"Fortunately, we are seeing prices stabilize and even rise."

Net cash inflow for the quarter was $4.2 million, down from $25.8 million in the fourth quarter. Hung expects second-quarter cash flow to be more than $40 million.

Financial highlights

ReneSola's first-quarter gross profit was down 154.4% quarter-over-quarter to a negative $5.6 million, due in part to a temporary halt in production for a facility upgrade, as well as the decline in ASPs and wafer shipments. The gross profit for the first quarter of 2012 was negative $8 million.

The company reported an operating loss for the quarter of $33.4 million, compared to $23.8 million for the prior quarter, and $37.8 million for the first quarter of 2012, according to the earnings news release.

A decrease in research and development expenses resulted in lower operating expenses for the quarter of $27.8 million, a 6.7% decrease from the prior-year period.

ReneSola had a net loss attributable to ordinary shares of $39 million, or a loss of $0.23 per share, for the first quarter, compared to a first-quarter 2012 net loss of $40.2 million, or a loss of $0.47 per share.

Based in Jiashan, China, ReneSola is a manufacturer of solar products.

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