Shunfeng International Clean Energy Limited (SFCE) unveiled its interim results for the first six months ended 30 June, 2015. Holistically, the revenue increased 19.5% y-o-y, which was significantly contributed by the solar power plants in operation. By the end of June, 2015, SFCE has a total of 1,294MW of solar assets under development, in construction, or grid-connected, in China.
In the first half of 2015, revenue increased 19.5% year-on-year to RMB3,520.4 million, reflecting a significant increase in power generated from solar power plants in operation. Net profit was RMB172.5 million in the first half of 2015 compared to RMB503.9 million in the corresponding period in 2014. The decline in net profit was primarily due to a reduction in the average selling price of solar modules and an increase in operating expenses as the Company executed its strategy to expand into international markets.
Business Highlights
- Integrated Low Carbon Solutions Business: In March 2015, the Company established a joint venture Shunfeng Nobao Group Company Limited with strategic partner Nobao, a leader in ground source heat pump technology. SFCE holds 51% of the JV, which is focused on delivering integrated clean energy solutions to help global customers reduce energy consumption by 50% to 70% while shifting to renewable generation.
- In April 2015, the Company formed a joint venture with AVIC Capital, a subsidiary of Aviation Industry Corporation of China, to promote the integrated clean energy business model and provide integrated low carbon solutions to AVIC, as well as other international clients.
- LED Business: In August 2015, the Company acquired a 59% equity interest in Lattice Power Corporation, a leader in GaN-on Silicon LED technology, to expand into the LED business and further implement its strategy of developing one-stop clean energy solutions for customers.
- Acquisition of US Solar Manufacturer: On 12 August 2015, the Company announced it will acquire a 63.13% equity stake in Suniva, a leading American manufacturer of high-efficiency, cost competitive PV cells and modules. The acquisition will enable SFCE to serve customers in the premium and more profitable US market and facilitate the expansion of Suniva's manufacturing capacity to over 400MW within the next 12 months.
Solar Product Manufacturing Business
The Group manufactures and sells solar wafers, cells and modules to customers both in China and international markets. For the six months ended 30 June 2015, the sales volume of solar products amounted to 1,193.4MW, representing a 19.6% increase from 997.5MW for the corresponding period in 2014.
SFCE continued to diversify its sales of solar products in the first half of 2015. Top 5 customers in the first half of 2015 represented approximately 26.6% of total revenue as compared to approximately 44.7% in the corresponding period in 2014. In addition, sales to international customers increased to 42.2% of the Group's total revenue in the first half of 2015 from 30.7% in the corresponding period in 2014.
Solar Power Generation Business
The Group develops and operates solar power plants, primarily in China. For the six months ended 30 June 2015, solar power generation increased by 176% year-on-year to 512,751 MWh. The growth was primarily due to an increase in the number of grid-connected solar projects in operation, which increased from 890MW as of 30 June 2014 to 1,622MW as of 30 June 2015.
In China, SFCE has 632MW of solar power projects under development, 674MW of solar projects in construction, and has connected 88MW of projects to the grids.
Solar Power Plant Operation and Service Business
SFCE acquired S.A.G. Solarstrom AG (S.A.G.) in the second half of 2014 to enhance capabilities in solar project development, EPC, and solar power plant monitoring, operation and maintenance. S.A.G. continued to gain traction with customers in international markets and provided EPC services for 36MW projects in the first half of 2015.
In addition, S.A.G.'s wholly owned subsidiary meteocontrol GmbH (meteocontrol), one of the world's largest solar plant monitoring service providers, started providing monitoring services for an additional 800MW of solar plants in the first half of 2015. As of 30 June 2015, meteocontrol provided monitoring services for an aggregate of 10.8GW of solar plants globally.
