LDK Solar Updates Outlook
LDK Solar Co., Ltd. provided an updated outlook for the fourth quarter of 2008 and select data for the year 2009. For the fourth quarter of 2008, LDK Solar now estimates revenue in the range of $415 to $425 million and wafer shipments between 245 and 255 MW. Additionally, LDK Solar expects to record write-downs of $210 to $220 million against the cost of inventories for a decline in net realizable value of inventories resulting from the rapid market price decline for solar wafers. As a result, the gross margin is expected to be negative and LDK Solar expects to report a loss of $135 to $145 million in the fourth quarter. For the full year 2008, LDK Solar estimates revenue in the range of $1.63 to $1.64 billion, wafer shipments between 810 to 820 MW and net profit of $145 to $155 million.
LDK Solar also provided an update to its plans for capacity expansion and capital spending for 2009. The company will delay its wafer capacity expansion by one quarter and now expects to reach 2.0 GW wafer capacity at the end of 2009 versus its original plan of 2.3 GW. In its 15,000 MT polysilicon plant, LDK Solar will delay the installation of its third 5,000 MT train. The first 5,000 MT train is expected to reach mechanical completion at the end of the second quarter of 2009; the second 5,000 MT train is expected to reach mechanical completion during the second half of 2009; and the third 5,000 MT train is expected to reach mechanical completion in 2010.
In LDK Solar’s small polysilicon plant, the company expects to increase annualized polysilicon production capacity to 2,000 MT from 1,000 MT by end of 2009 in order to improve its production cost structure. Production of polysilicon in the small plant has been progressing well and is expected to reach full production capacity of the initial 1,000 MT in mid 2009. The combined annual production capacity for both plants is now expected to reach 12,000 MT versus its original plan of 16,000 MT by the end of 2009.