August 31 (Solar) – China's Comtec Solar Systems Group (HKG:0712) on Thursday posted losses for the first half of 2018 as revenue slumped 68.1% year-over-year.
The company said that China's new policies from May 31 that are expected to cut solar installation quota and feed-in-tariffs (FiTs) in China during the second half of 2018 have caused uncertainties in the domestic solar market and hit industry demand and the price of upstream products.
Net loss attributable to the owners of the company was CNY 100.6 million (USD 14.7m/EUR 12.6m), versus a net profit of CNY 8.8 million in the year-ago period.
The company also recorded a gross loss of CNY 7.8 million, against a gross profit of CNY 35.9 million a year ago, due to a fall in selling prices and sales volumes, as well as an inventory provision of CNY 17 million. The gross margin moved to negative 7.8% from positive 11.4%.
Revenue dropped to CNY 100.2 million as both the selling price and sales volume of most of the company's upstream solar products fell. The drop was softened by revenue from the lithium batteries system and power storage system business acquired by the firm in October 2017.
Revenue from sales of wafers was down 63.7% and from ingots — 80.7%. Revenue from the downstream solar business also declined substantially as the company focused on developing its own projects for subsequent sale to long-term institutional investors, rather than providing project development services to third parties.
Comtec said that as of June 30 it has grid connected 11.5 MW of downstream rooftop distributed generation projects that could be transferred to a co-investment vehicle formed with Macquarie Capital last year.
(CNY 1 = USD 0.146/EUR 0.125)