First Solar Falls After Reporting $401 Million Charge
First Solar Inc. (FSLR), the world’s largest maker of thin-film solar panels, fell to a record low after reporting a $401 million restructuring charge yesterday related to firing 30 percent of its workforce.
First Solar fell 6.3 percent to $16.94 at the close in New York, the lowest since going public in November 2006. The shares have declined 50 percent this year. The Tempe, Arizona-based company reported yesterday a first-quarter net loss of $449.4 million, or $5.20 a share.
A global glut of solar panels combined with cuts to government subsidies in the U.S. and Europe have driven down prices for solar panels 48 percent in the past year. The company announced March 17 it would would fire 2,000 employees worldwide and close a plant in Germany.
First Solar raised its 2012 earnings-per-share forecast yesterday, to a range from $4.00 to $4.50 a share, from an earlier forecast of $3.75 to $4.25.
That boost is due mostly to one-time cost savings from the restructuring, according to Aaron Chew, an analyst with Maxim Group LLC in New York.
While the increase “may spark hope a recovery is at hold, this owed solely to the $50 million to $60 million in expected 2012 restructuring savings,” he said in a research note today. With panel pricing continuing to slide, earnings “guidance may still be at risk.”
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