JA Solar Earnings Top Consensus Estimates

Feb.16.10 | About: JA Solar (JASO)

JA Solar Holdings Co. Ltd. (JASO) announced adjusted earnings per American Depositary Share (EPADS) of RMB 0.94 (14 cents) in its fourth quarter, which exceeded the Zacks Consensus Estimate of 11 cents by 3 cents. The performance improvement came from higher shipments and growing margins.

Estimate revisions trend
At present, 18 analysts cover the stock. Of this two have revised their estimates downward and one has upped his estimate for fiscal 2010 in the last 30 days.

Currently, the Zacks Consensus Estimate for full fiscal 2010 earnings is 32 cents per share, which would be a significant improvement over full fiscal 2009 loss of 12 cents.

Quarterly Performance
JA Solar’s revenue in the reported quarter rose 66.2% to RMB 1.6 billion ($238.4 million) compared to revenue of RMB 979.0 million ($143.4 million) in the year-ago quarter. Also compared to the third quarter of fiscal 2009, revenue rose 23.4%.

The upside in revenues came from higher shipments. In the reported quarter total shipments increased to 231MW compared to shipments of 177MW in the third quarter of fiscal 2009. In the year-ago quarter, shipments were only 61MW, representing a growth of 278.7% in the reported quarter.

JA Solar’s gross profit in the reported quarter rose to RMB 333.8 million ($48.9 million), compared to RMB 220.5 million ($32.3 million) in the third quarter of 2009 and RMB 9.7 million ($1.4 million) in the fourth quarter of 2008. Gross margin was 20.5% in the reported quarter. A significant improvement, compared to 16.7% in the third quarter of 2009 and 1.0% in the fourth quarter of 2008.

Financial Condition
JA Solar at the end of fiscal 2009 had cash and cash equivalents of RMB 1.9 billion ($273.6 million), and total working capital of RMB 3.0 billion ($444.2 million) as on December 31, 2009. Total long term bank borrowings were RMB 680 million ($99.6 million) and convertible bonds outstanding stood at RMB 1.6 billion ($228.2 million) as on December 31, 2009.

JA Solar raised its shipments guidance range for fiscal 2010 to over 900MW from its prior guidance range of 750MW – 800MW. Shipments in the first quarter of 2010 are expected to range between 215MW and 225MW.