JinkoSolar Confirms 11.5-12 Gigawatt Shipments For 2018 Despite Q1 Earnings Miss

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Global leading Chinese solar PV manufacturer JinkoSolar has confirmed this week it intends to ship between 11.5 and 12 gigawatts (GW) worth of solar modules in 2018, despite also reporting first-quarter earnings down 20.9% year-over-year.

Earlier this year, Chinese solar PV manufacturing giant JinkoSolar was confirmed as the world’s leading solar PV module supplier by leading data and analytics firm GlobalData, having shipped 9.80 GW and accounted for nearly 10% of the global market share. At the same time that JinkoSolar announced its 2017 financial results in March it also provided shipping guidance for 2018 of between 11.5 GW and 12 GW.

Of course, JinkoSolar has run into some headwinds this year already, with the United States imposing tariffs on imported solar cells and modules, and China’s recently-announced cap on national solar capacity. However, in spite of this, JinkoSolar has also already had some big wins, including announcing it would build its first US solar manufacturing facility in Florida in support of a 2,750 megawatt (MW) supply agreement with NextEra Energy and another supply agreement for 1.43 GW with sPower.

The company announced this week its first-quarter earnings in which it shipped a total of 2,015 MW of solar modules, including 209 MW to its own downstream solar projects. This is a decrease of 18.8% from the 2,481 MW shipped in the fourth quarter of 2017 and a 2.6% decrease on the 2,068 MW shipped in the first quarter of 2017.

Gross margin for the quarter was 14.4, compared with 11.6% in the previous quarter (Q/Q) and 11.2% in the same quarter a year earlier (Y/Y). Total revenues for the quarter amounted to RMB4.57 billion (US$728.1 million), a Q/Q decrease of 28.1%, a Y/Y decrease of 20.9%.

Image Credit: Jinko Solar

“The new policies regulating the solar industry jointly issued by three Chinese ministries on May 31, affected market sentiment and our ASPs,” explained Kangping Chen, JinkoSolar’s Chief Executive Officer. “These new policies are aimed at increasing the pace of achieving grid parity, accelerating the removal of outdated capacity and releasing the pressure of new energy fund deficits. As a result, we expect to see a decline in prices across our industrial supply chain which will allow us to further cut both silicon and non-silicon costs during the second half of the year to offset the decline in the ASPs.”

However, the company didn’t necessarily perceive these shifts in China solar policy as a negative and maintained its shipment guidance for 2018 unchanged. The company already boasts an order book which, according to Kangping Chen, “is mostly made up of overseas orders with fixed prices throughout the year.” Specifically, JinkoSolar expects overseas orders to account for 80% of the company’s total shipments for the entire year, helping it to relegate China’s policy shift to the backburner.

“Despite the strong initial reaction to the new policies, we remain optimistic about the demand of the Chinese market for the full year 2018, which is expected to hit 35 GW+,” said Kangping Chen. “Looking into 2019, aside from the Top Runner Program, poverty alleviation, and DG projects, we expect to see a large number of grid parity projects under new business models appear in the second of half of 2019.”

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Joshua S Hill

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