Module Supplier Canadian Solar Reports 8.6% Rise in Net Revenue in 2020

Canadian Solar, a Canada-based solar module manufacturer, reported an 8.6% increase in net revenue with $3.47 billion in 2020 compared to $3.20 billion in 2019 owing to a 32% annual growth in total module shipments to 11.3 GW.

However, the company recorded an 11.6% decline in its net income to $147.24 million in 2020 from $166.55 million in 2019.

Q4 FY 2020 Results:

Canadian Solar reported a 24.22% decline in its net income in the last quarter of 2020 to $6.71 million, compared to $8.86 million in Q3 FY 2020. Its gross profit in Q4 2020 was down by 20.92% to $141 million from $178.4 million in Q3 2020.

However, the company’s net revenue stood at $1.04 billion in Q4 2020, a 13.91% increase compared to $914.36 million in Q3 2020. In Q4 2020, it shipped 3 GW of solar modules to over 70 countries, including markets like China, Vietnam, Brazil, Australia, and the United States.

The gross margin was 13.6% in Q4 2020 compared to 19.5% in Q3 2020. The gross margin declined due to the previously anticipated increase in manufacturing costs that was partly redeemed by higher module average selling price and a favorable mix.

Huifeng Chang, Senior Vice President and Chief Financial Officer, Canadian Solar, said, “In the fourth quarter, we achieved over $1 billion in revenue and a 13.6% gross margin, both ahead of our guidance. We generated $120 million in net cash from operating activities in the fourth quarter and ended with a $1.6 billion total cash position, giving us the financial strength to support attractive long-term growth opportunities.”

According to Canadian Solar, it has solar projects with 20.2 GW capacity, including 1.6 GW of under-construction projects, 3.8 GW of backlog, and 14.8 GW of an earlier-stage pipeline, as of January 31, 2021. It also has energy storage projects with 8.77 GW capacity, including 913 MW of under-construction projects, 1.38 GW of backlog, and 6.46 GW of an earlier-stage pipeline, as of January 31, 2021.

Business Outlook:

The company aims to expand its solar cells manufacturing capacity in FY 2021 to 18.2 GW from 9.6 GW in 2020. It is also expected to increase its solar module manufacturing capacity to 25.7 GW in FY 2021 from 16.1 GW in 2020. In FY 2020, the company has plans to expand its ingots and wafer manufacturing capacities to 10 GW and 11.3 GW, respectively.

Shawn Qu, Chairman and Chief Executive Officer, Canadian Solar, said, “We are seeing a steep increase in demand for clean power assets across the world, both for solar and battery storage projects. We have over 20 GW of solar project pipeline and nearly 9 GW of battery storage pipeline. We are positioned to benefit from robust growth in both areas.”

“We have been developing our technology in system integration and go-to-market capabilities for battery storage solutions in the past few years. In 2021, we will start delivering at scale and expect to capture around 10% of the battery storage market in the U.S., based on Wood Mackenzie market estimate,” Qu added.

In February 2021, Canadian Solar announced the close of the Japan Green Infrastructure Fund, which secured capital investment worth 22 billion Japanese Yen (~$208 million).

Mercom had earlier reported that Windel Capital signed a project development agreement with Canadian Solar to co-develop 1.4 GW of solar projects in the U.K.