First Solar Revenue to Fall Short of Estimates in First Quarter

First Solar Inc. (FSLR), the world’s biggest maker of thin-film solar panels, said first-quarter revenue will fall short of analysts’ expectations after it shuttering a plant in Germany. The shares fell 7.3 percent after the close of regular trading.

Net income was $154.2 million, or $1.74 a share, compared with a net loss of $413.1 million, or $4.74 a share, a year earlier, Tempe, Arizona-based First Solar said today in a statement. Excluding costs related to restructuring, the company earned $2.04 cents a share, exceeding by 27 cents the average estimate of 21 analysts. Sales rose to $1.08 billion from $660.4 million.

First Solar last year began reducing capacity as a global surplus and waning government support drove down solar-panel prices 31 percent in 2012. The company boosted revenue last year by expanding efforts to build large power plants with its panels, and needs to develop more projects to keep its pipeline filled, according to Rob Stone, an analyst at Cowen & Co. in Boston.

“We believe additional bookings are needed to avoid further shut-downs and charges,” Stone said in a research note Feb. 22.

First Solar is finishing solar farms faster than it’s selling new ones, he said. Most of its current projects will be complete by 2015.

“We believe the actual backlog peaked in the second quarter at 2.5 gigawatts and currently stands at 1.85 gigawatts,” Stone said.

The shares fell 9.3 percent to $28.75 at 4:48 p.m., after the close of regular trading in New York.

‘Battlefield Stock’

“They had a healthy quarter but it looks like revenue guidance for the first quarter was below street expectations,” Sanjay Shrestha, an analyst at Lazard Capital Markets, said today in an interview. “This is a battlefield stock and without full guidance for the year the shares are getting hit.”

For the first quarter, sales will be in the range of $650 million to $750 million, less than the $803.6 million average estimate of 18 analysts. That will result in per-share profit of 70 cents to 90 cents, which compares to an average estimate of 78 cents.

First Solar announced in April plans to close its plant in Frankfurt an der Oder, Germany, with about 560 megawatts of annual production capacity. The company also idled four production lines in Malaysia.

First Solar has about 1,800 megawatts of panel production capacity, mainly in Malaysia and the U.S., Stone said.

To contact the reporter on this story: Christopher Martin in New York at cmartin11@bloomberg.net

To contact the editor responsible for this story: Reed Landberg at landberg@bloomberg.net

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