First Solar, a U.S.-based manufacturer of solar modules, has released its financial results for the first quarter of 2021 (Q1 2021). Net sales for Q1 2021 touched $803.4 million, an increase of $194 million from the previous quarter. In a year-over-year comparison, the net sales were up 51%.
The company attributed the 32% rise in sales to an increase in systems revenue driven by U.S. project sales.
The firm’s net sales in Q4 2020 stood at $609.2 million, 34% down from $927.6 million in Q3 2020. It attributed the Q4 dip in net sales to higher international project sales in Q3 2020, which was partially offset by increased module sales in Q4 2020.
The firm’s operating income for Q1 2021 was $252.3 million, a $194.5 million increase compared to $57.8 million in Q4 2020. The operating income was $250.6 million compared to Q1 of 2020.
Source: First Solar
“We delivered strong operational and financial results for the first quarter, and demand for our Series 6 technology continues to be robust,” said Mark Widmar, Chief Executive Officer, First Solar, in the post-earnings conference call.
“The dedication we continue to witness from our associates enabled us to deliver module segment gross margin in line with our first-quarter guidance, complete the sales of our Sun Streams 2, 4, and 5 projects, and close the U.S. project development and North American operations and maintenance (O&M) sales,” he added.
Widmar also noted that the above pointers, coupled with manufacturing execution, enabled the firm to deliver sound earnings per share in the first quarter.
The company’s net income during the quarter was $209.7 million, up $94 million compared $115.7 million in Q4 2020. The net income increased $119 million compared to the same quarter in 2020.
First-quarter operating income includes depreciation and amortization of $63 million, share-based compensation of $3 million, charges associated with the initial ramp of the firm’s new factory in Malaysia, underutilization expense, and production start-up expense totaling $16 million, and a gain on the sales of its U.S. project development and North American O&M of $151 million.
Cash, cash equivalents, restricted cash, and marketable securities at the end of the first quarter totaled $1.8 billion, which was largely unchanged from the prior quarter. The company ascribed the stagnant numbers mainly to proceeds from the sale of North American O&M business and proceeds from the sale of certain securities associated with end-of-life module collection and recycling program, which First Solar intends to reinvest in subsequently.
The company added that the numbers were partially offset by an increase in accounts receivable related to its U.S. project development and Sun Streams 2, 4, and 5 sales, along with operating expenses, capital expenditures, and payment of variable compensation.
The company further said that it exited 2020 with a 6.3 GW nameplate manufacturing capacity, which increased to 7.9 GW by end of Q1 2021. The firm aims to reach a nameplate manufacturing capacity of 8.7 GW and 9.4 GW by the end of 2021 and 2022, respectively.
Source: First Solar
Talking about the firm’s deals, the company said that it has signed an agreement to sell the U.S. project development platform to Leeward Renewable Energy and hopes to close the deal by the first half of 2021.
With respect to O&M, First Solar has agreed to sell the North American O&M business of utility-scale solar project platform of around 10 GW to NovaSource Power Services, a portfolio company of Clairvest Group. The firm aims to seal the deal in the first half of 2021.