Solarfun Beats Street, Triples Profits, Tumbles Anyway

Eric Savitz (Barron's) submits: Solarfun (SOLF) shares are down sharply this morning despite better than expected Q2 results. For the quarter, the company posted sales of $197.1 million and profits of 24 cents a share, beating the Street at $182.9 million and 23 cents. Solarfun said it shipped 43.1 MW of solar modules in the quarter, plus another 5 MW of cells “with specification levels that are different than the company’s mainstream business.” The company said its ASP improved to $4.17 from $4.07. Gross margin fell to 13.7% from 15.8% a year ago, due to higher polysilicon and wafer costs. In the quarter, the company generated 56% of revenue in Germany, 33% in Spain and 5% in France. For all of 2008, the company now sees total shipments of 175-190 MW, up from 160-180 MW. The company expects pricing in Euros to be stable for the rest of the year. The company sees gross margin improving in the second half, but that polysilicon and wafer pricing will “continue to be high” in the third quarter.Complete Story »