Pick Hat rely on Government subvention hareon continually and easily

Polaris solar PV net news: *ST sea run “pick hat” is coming.

According to the 2015 annual report, the company’s audited net profit indicators relating to delisting risk warnings has been removed, has applied to withdraw withdrawal risk prompts in the SSE. This means, according to related procedures, *ST sea run quick recovery this week “hareon” stock.

Lifting of delisting risks to the controversial company saved a bit of face. Hareon, or will this year experience a lot of “toss”: finally to profitability performance when you can sit? When lawsuits can sue? Vacancies of the company head when you can fill?

Is worthy of recognition, hareon last year’s “battle of the shell” played was more successful. Annual report, hareon revenues 6.089 billion yuan last year, up 22.8% from 2014. Net profit of 96 million Yuan, successfully fill in 2014, the year 948 million Yuan loss gap left.

Pick Hat rely on Government subvention hareon continually and easily

Hareon solar performance of “nightmare” beginning in 2011. Year, in order to successfully achieve the backdoor listing, shareholder of the company, Jiangsu sunshine group made a three-year high performance commitments. But the company will not achieve its objectives in the first year, and then embarked on a downhill.

Turns out, “fallen” was swift. From 2011 profit of 402 million yuan in losses, hareon with only a two-year period – in 2013, hareon loss of 203 million yuan in net profit that year. In 2014, its loss widened to 948 million Yuan, and “hats”.

Throughout the company’s business structure is not difficult to find, and losses derived from the solar cell and solar module both the main business of ups and downs. Hareon main cover five business: silicon Rod/sheet ingot, polycrystalline silicon for solar cell/sheet, solar cells, solar modules and solar photovoltaic power plant. Among them, the solar modules and solar cell businesses contributed to the company’s performance has remained in the top two. Especially the solar module business, and its annual revenues are above 50% per cent.

Pick Hat rely on Government subvention hareon continually and easily

However, 2011-2014, hareon suffered a component with a solar cell business gross margin is extremely unstable condition. In 2011, the two main business, gross margins were 11.65%, 8.51%. In 2014, the value slipped to 10.61% and 2.22% respectively. But by 2013, components and solar cell business gross margin improvement, 12.43% and 8.5%, respectively.

In 2015, hareon was able to successfully achieve profitability is closely related to the two main business. Component services in revenues last year of 3.515 billion yuan, up 22.6% from 2014, gross margin of 15.7%; solar cell business 2015 achieved revenues of 906 million Yuan, an increase of 16.97%, gross margin was 8.98%. It is worth mentioning that, both gross margin of the business last year were at a nearly five-year high.

Components and the battery is behind the record-high gross margin of sales last year, the two types of products had improved significantly. On one hand, in 2015, the component of the company’s production capacity of 944MW, sales reached 1051MW, the sales rate to 111.33% in 2014, representing a 89.65% there has been a significant increase in the rate of production and marketing. The other hand, the company’s production and sales of solar cell business are further improved, production and marketing rate of 34.19%, its highest value in 2012. In addition, the company has done a good job in inventory levels. These two products inventories last year to 28MW, 20MW in 2014, representing a down 53.3% and 59.57%, respectively.

Pick Hat rely on Government subvention hareon continually and easily

But it attracted the attention of journalists. In this report, hareon do not disclose sales customer situations, only to “these silicon wafers, cells, modules containing part of the internal use of industrial chain,” explained. In the related party transactions column, named ReNewSolarEnergy (Karnataka) PrivateLimited Consortium (hareon directly held 49% shares) during the reporting period to purchase 239 million worth of components. In the previous issue, the transaction amount is 0. Although this part of turnover accounted for only 6.8% components of annual revenue, but this will make people think.

Of course, performance has also benefited from its introduction in 2012 solar PV power plant business. Hareon solar PV power plant businesses include power generation and construction. Construction business in 2013 for the company to expand the business, the formation of the business marking hareon solar sphere model of vertical integration. Power generation and power station engineering construction growth is obvious. Among them, generating revenue growth to 2015 from 2012 in 48 million yuan of 327 million Yuan, gross margin was 43.47%. Power plant construction business in the year 2013 layout of its 629 million yuan in revenues. Last year, it reached 969 million yuan of income in 2014, representing a growth of 59.51%, and in one fell swoop over the solar cell business.

Focus on main business recovery does make hareon business this year has been “emboldened”. However, the company this year to continue to improve is not easy.

First, the company in 2015 narrowly complete losses, but the profitability of part of the company’s main business is slipping. In addition to components, solar cell, solar PV power plant main profit points, silicon and polycrystalline silicon-chip business has been for the company’s “senior” business. However, these two operations last year dragged performance “hind legs”. Polycrystalline silicon wafer business in 2015 and 17 million of revenue, but the data not only than in 2013 of 260 million Yuan, and its gross profit margin was-15.94%. Last year, the other a silicon chip business is simply no revenue. In addition, even revenue share of solar photo-voltaic power generating income, its gross margin also decreased, has dropped to 43.47% last year from 66.68% in 2012.

In addition, solar cells and modules business or in 2016 will be encountered price impact, significantly impact the company’s performance this year. In terms of cells, according to Taiwan research firm survey released TrendForce is a member of the EnergyTrend3 month, United States, and Japan the peak end of the PV device settings, combined with photovoltaic grid-connected power generation equipment business in China will be at the end of June this year, a combination of factors to consider global market demand of solar cell is on the decline. Decreases the demand for lead developers began to get orders “price war”, solar cell prices fall or at an unexpected rate. In terms of components, according to the PV market research agency PVInsights statistical sampling, 2016, the whole component prices continued to fall. Thus, both types of product price risk will spread to the country’s first vertically integrated photovoltaic companies, hence, hareon impact is inevitable.

Pick Hat rely on Government subvention hareon continually and easily

Second, although hareon 96 million yuan in net profit last year, but its ownership of shareholders of listed companies non-96 million yuan in net profit, the data for companies for 4 consecutive years of negative values. It recorded into the profits and losses of the current period of government subsidies on a value most. In consecutive losses in 2013 and 2014, the Government’s subsidies reached its lowest level for nearly 5 years, 38 million, 32 million Yuan, respectively, far less than the 175 million Yuan, 454 million in 2011 and 2012. Last year, the Government’s subsidies to increase recorded into the profits and losses of the current period value reached 115 million Yuan, which has become the key to company to profitability.

Moreover, as synergies with the parent company’s wholly-owned subsidiary of 18 key, half are still at a loss. Among them, hareon (Shanghai) co-led 3 domestic wholly-owned subsidiaries amounted to a loss of 113 million Yuan last year, and S.C.GreenVisionSevenS.R.L. 6 overseas, led by wholly-owned subsidiary (*ST hairun’s main overseas wholly owned a total of 8) amounted to a loss of 95 million Yuan last year.

Hareon also is facing a projected liabilities arising from the lawsuits. 2015 according to the annual reports of the company, and its pending litigation or arbitration during the reporting period a total of 9 items. One of the most interesting is that company was released on January 23, 2015 ten get 20 high transfer plans for misleading statements, the original shareholders disproportionately large holdings of failing to disclose, the original shareholders to engage in short-term trading caused by investment losses of small shareholders, or the compensation of 51.2653 million Yuan for the company. Up to April 2016, the first batch of 17 investors hareon false statement of securities litigation case settlement phase amounts to 676,400.

Worth noting is that management instability hareon has become a big problem. Company founder, known as the “Godfather of solar,” said Yang Huaijin in December 2015, resigned as President, Chief Executive Officer, Chairman of the post company and two of its directors resigned. In order to play well, “war”, senior director Li Yanren “fire” took over as Chairman, but resigned from the post this month. As of now, hareon yet announcement of new Chairman candidate.

Original title: pick hat wants to rely on Government subvention hareon performance continued improvement will not be easy

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