By Ucilia Wangarning
The fallout of the Lehman Brothers' bankruptcy continues as JA Solar Holdings Co. (NDSQ: JASO) blames its dealings with the investment bank for its third-quarter losses Wednesday.
The Chinese solar cell maker posted a third-quarter loss of $21 million, or 36 cents per share, compared with a net profit of $24.4 million, or 17 cents per share, in the third quarter of 2007. The company reported a 149 percent jump in revenue to $312.3 million in third quarter from $125.2 million from the year-ago period.
The financial market turmoil has caused "panic" among solar energy equipment makers, said JA Solar CEO Samuel Yang in a conference call with analysts. Solar energy equipment makers who have increased production in the past year to meet demands are now worried about oversupply.
The company plans to renegotiate silicon supply contracts to get better prices. The faltering economy and the dramatically weakened euro have led JA Solar to slash its sales forecast.
JA Solar now expects its 2008 revenue to reach between $849.5 million and $878.9 million. It had previously anticipated $1.05 billion to $1.17 billion. The 2009 revenue forecast has been chopped to between $1.5 billion and $1.7 billion, instead of the previously announced $2 billion to $2.2 billion.
The company's shares plummeted nearly 26 percent to reach $2.48 per share in recent trading.
JA Solar took a serious beating as a result of its relationship with Lehman, which filed for bankruptcy in September. The solar company took a $100 million loss from its short-term investments with Lehman. JA Solar also recorded a loss of $7.35 million in derivatives deals with the investment bank, which is now largely owned by U.K.-based Barclays.
On top of that, it had to factor in shares it loaned to Lehman as part of a fund-raising effort in
