LDK Solar Co. Ltd. Earnings: Swing to a Loss

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LDK Solar Co. Ltd. (NYSE:LDK) reported its results for the fourth quarter. LDK Solar is a solar module manufacturer. The company sells multicrystalline and monocrystalline wafers globally to manufacturers of solar cells and modules.

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LDK Solar Earnings Cheat Sheet for the Fourth Quarter

Results: The company swung to a loss of $588.7 million (loss of $4.63 per share) vs. net income of $145.2 million ($1.09 a share) a year ago.

Revenue: Fell to $420.2 million from $920.9 million a year earlier.

Actual vs. Wall St. Expectations: LDK Solar Co. Ltd. fell short of the mean analyst estimate of a loss of 73 cents per share.

Quoting Management: “The solar industry experienced a tremendous supply and demand imbalance throughout the value chain during the fourth quarter. Our results reflected the negative effects of this dislocation in the PV market,” stated Xiaofeng Peng, Chairman and CEO of LDK Solar. “Weak market demand and rapidly declining average selling prices reduced our revenue and adversely impacted our margins in the quarter. “In 2012, we expect that excess capacity and further policy uncertainties in Europe and the U.S. will result in continued intense competition within the solar industry. As such, we remain focused on improving our cost structure by driving down production costs and closely managing our operating expenses. PV applications are increasing globally with improved affordability for solar electricity. We continue to believe that the considerable opportunities to meet global energy needs with solar power will drive long-term market growth,” concluded Mr. Peng.

Looking Forward: The average estimate for the first quarter of the next fiscal year is down from a loss of 60 cents per share ninety days ago to a loss of 64 cents, indicating that analysts are increasingly pessimistic about the company’s next quarter performance. For the fiscal year, the average estimate has moved from a loss of $1.19 a share to a loss of $1.36 over the last ninety days.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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