JinkoSolar’s 2018 Q2 solar module shipments and revenues increased 38.7% sequentially to 2,794MW, mainly driven by continuous demand and new product launches. Gross profit increased 11%, and particularly net profit of Q2 has seen an increase of 2653% from the previous quarter and 109% increase from the second quarter of 2017, as a result of strong global sales network, higher capacity utilization, and industry leading cost structure helped offset the impact from new policies issued by the Chinese government on May 31st.
Moving on to 2018 second half and full year guidance, the company has good visibility of order bookings for the entire year which is predominantly comprises of overseas orders and markets which are growing rapidly and will generate significant opportunities ahead. Based on the current business outlook, the company is expected to deliver 6.7GW-7.2GW of solar panels during the second half of the year, representing a 40% sequential increase. On a full year base, the total shipment will reach between 11.5GW – 12GW, increasing >17% YoY, which is very likely to make it secure No.1 position once again in the industry. Moreover, its gross margin and net income is expected to grow significantly in the coming quarters Q3 & Q4 due to continual operational efficiency improvement, diversified customer base, highly competitive products and higher level of R&D activities.
JinkoSolar’s CEO commented during Q2 earning call, “We are taking full advantage of our market leader position and production facility in Florida to expand our presence in the U.S. market. Demand in emerging markets continues to grow, especially in Latin American, the Middle East and North Africa. We are deploying our resources there towards securing large & long-term orders through our mature sales network which spans a number of markets. We believe that the Indian solar sector will maintain its long-term growth trajectory despite the short-term impact of recently announced tariffs and we will continue to explore opportunities there.”
Regarding the impact of China’s latest policy, from the global perspective, the policy will accelerate grid parity worldwide, and incubate numerous growth drivers for the industry. Even in China, demand from Top Runner Program, poverty alleviation projects, local government subsidies, and self-contained DG projects will continue to drive the growth in the Chinese market, especially in regions with ample sunlight and high commercial power prices. On one hand, it will push the agenda for industrial upgradation and accelerate the industry’s consolidation by phasing out outdated production capacities and replacing them with high efficiency ones; On the other hand, it will also push the rapidly falling cost of solar, making solar more competitive and stimulating the global demand. Grid parity spurred by China’s current policy, will lead to new waves of demand for years to come. Lately, it is observed the demand from emerging market surged, that requires high-performance and better price. JinkoSolar’s advanced technology and production suits it well.
On the R&D progress and new product availability, JinkoSolar has made significant progress in improving wafer efficiency and reducing both oxygen content and light induced degradation. It is increasing the mono PREC cell capacity which will reach 4.2GW by the end of year. It had been also investing in N type technology, especially HOT double sided cell technology. The falling cost of raw materials and its deep experience in rapidly rolling out new technologies will allow it to further optimize the cost structure going forward. JinkoSolar has successfully ramped up and already achieved good yield of Cheetah series, which boosts up to 400W in mass production.
It also made significant progress in improving manufacturing capacity, consistently demonstrating high yield on its super-smart factory in Shangrao which had been out into operations. MES and other intelligent manufacturing equipment and IoT based control system run well in its labs. This GW scale super smart factory will be ready for high-volume production in H2 2018 and 2019.
JinkoSolar is now in a good position and is fully prepared for new and upcoming opportunities.