On April 21st, JA Solar released its quarterly report showing a significant turnaround in its gross profit margin, which turned positive at 6% for the first quarter of this year, up from -4.6% in the previous quarter. This trend is not isolated—several other solar companies have also reported improved margins, with only Yanhuiguang experiencing a negative gross profit margin of -2% during the same period. The positive results sent the China General Solar Energy Index soaring by 23.42%. However, industry experts remain cautious, believing that the short-term improvement is largely driven by policy support rather than a true recovery.
According to the report, JA Solar generated RMB 1.7 billion in net revenue, a 4.7% year-on-year increase. Gross profit reached RMB 99.9 million, while the net loss narrowed to RMB 206 million, down from RMB 258 million in the previous quarter. The company attributed the improved gross margin to increased component sales in Japan and expansion into emerging markets. With European and U.S. anti-dumping duties on Chinese solar products, many Chinese solar firms have shifted their focus toward new regions. For instance, the share of shipments to the EU dropped from 70% in 2011 to below 40% in 2012, and further declined to around 20% today.
In addition to JA Solar, several other photovoltaic companies have released their quarterly reports. While Yanhui Sunshine reported a gross margin of -2% and a loss of $5.6 million, most others showed positive results. Some companies even raised their performance forecasts, with one stating it now expects a gross margin of 9-10% for the first quarter, up from the earlier forecast of 8-10%.
Despite these improvements, Wang Xiaokun, an energy analyst at Zhuochuang Information, remains skeptical about the industry’s long-term recovery. “The domestic solar market still lacks supportive policies,†he said. “The only existing subsidy is already anticipated and does little to improve the industry's overall situation. Moreover, international markets still face barriers, and overcapacity remains a major challenge for solar companies.â€
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