Yingli Green in Talks With Bondholders for Repayments, CFO Says

  • Panel maker plans to sell assets, including solar-power plants
  • Company hasn't reported a profit since second quarter of 2011

Yingli Green Energy Holding Co., the Chinese solar-panel maker that failed to make a complete debt payment last year, is in discussions with bondholders of 1.4 billion yuan ($213 million) of notes due in May on how to make a repayment.

The company plans to sell assets, including some of its solar-power plants, and will accelerate the pace at which it sees cash inflows from panel sales and a return on investments, Chief Financial Officer Wang Yiyu said in a phone interview on Thursday.

Yingli, which hasn’t reported a profit since the second quarter of 2011, had total debt of about $1.9 billion at the end of the third quarter last year. The debt load has left the company with large interest obligations, hampering its ability to return to profit. The company’s interest costs stood at $160.2 million in the 12 months ending in September, representing about 9 percent of revenue for the period.

A glut of solar panels has seen prices tumble by almost 70 percent since 2010, taking its toll on the financially weakest producers, including Yingli and state-owned Baoding Tianwei Group Co.

To help Yingli, Chinese regulators have asked local government agencies and banks to support the company’s asset and debt restructuring, International Finance News reported on Thursday.

Debt Restructuring

The support "will help solve the company’s difficulties," Wang said.

While Baoding-based Yingli’s low prices helped it become the biggest panel provider as measured by shipments in 2013, it was overtaken the following year by Trina Solar Ltd. as it struggled to deal with its debt burden. The focus on debt has impinged on Yingli’s operations, with the company lowering its shipment estimate for 2015.

Unit Baoding Tianwei Yingli New Energy Co. still owes about 350 million yuan on 1 billion yuan of notes that were due on Oct. 13, 2015, according to Wang.

Yingli, which said in September that it expected to receive about $138 million by selling off land and the demolition of facilities held by one of its wholly-owned subsidiaries, will use final payments from the land liquidation to repay the debt still owed, Wang said.

Yingli’s total debt due this year will be less than in 2015, Wang said.

The company said earlier this month that it plans to build its first overseas factory in Thailand. Yingli isn’t a majority shareholder in the joint venture and the plant will be built with exiting equipment, reducing the capital used, said Wang.

Global solar installations will grow by at least 20 percent this year compared with 2015 and Yingli will focus on panel sales to speed up the turnover of capital, Wang added.

— With assistance by Feifei Shen

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