MEMC Reports $92 Million First-Quarter Loss as Sales Fall
MEMC Electronic Materials Inc. (WFR), the second-largest U.S. polysilicon maker, posted a first-quarter loss 20 times greater than a year earlier as solar sales declined by more than one-third.
Revenue in the company’s solar energy unit dropped 37 percent to $303.2 million compared with a year earlier, St. Peters, Missouri-based MEMC said in a statement released after the close of regular trading today.
Prices for polysilicon, the main raw material in solar cells, fell 70 percent in the last year to $23.78 a kilogram as Chinese companies increased production and demand for panels slowed. MEMC announced in December it would fire 20 percent of its workforce and cut production. The unit’s president quit last week.
“Given where poly prices have fallen to, I wouldn’t be surprised if there’s further restructuring,” Theodore O’Neill, an analyst at Wunderlich Securities Inc. in New York, said by telephone.
The company’s net loss for the quarter was $92 million, or 40 cents a share, compared with a $4.5 million loss, or 2 cents a share, a year earlier. The loss was more than the 26-cent average estimate of 11 analysts compiled by Bloomberg.
MEMC said in the statement it estimates full-year 2012 solar project sales volume “greater than” 400 megawatts, including the 149 megawatts it reported today and a forecasted 130 megawatts to 170 in the current quarter. “If they’re guiding to 150 in the second quarter, that means it’s going to fall off a cliff in the second half,” O’Neill said.
MEMC shares fell 1.8 percent to $3.25 at the close in New York. They dropped 3.7 percent to $3.13 at 5:23 p.m., after the close of regular trading.
Kenneth Hannah resigned May 3 as president of MEMC’s solar unit to become chief financial officer at J.C. Penney Co., the fourth-largest U.S. department store chain. MEMC will spend the next few weeks searching for Hannah’s successor, Bill Michalek, a company spokesman, said in a telephone interview yesterday.
Hemlock Semiconductor Corp., based in Hemlock, Michigan, is the world’s biggest producer of polysilicon, the main raw ingredient in solar cells and semiconductors.
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