Canadian Solar Q1 EPS Misses; Takes Hit On Forex Hedging

Canadian Solar this afternoon reported lower-than-expected profits for the first quarter, apparently due to losses on foreign exchange hedging.

For the quarter, the solar products company reported revenue of $443.4 million, up 31.6% form a year ago, and ahead of the Street at $423.5 million. Profits were $5.9 million or 13 cents a share, well short of the Street consensus at 41 cents. Note however that the company took a loss of $17.7 million in the quarter from forex hedging.

For Q2, the company sees shipments of 245 to 255 MW, up a bit from the 244 MW shipped in Q1. Gross margin in the second quarter is expected to be 13%-15%, compared with 14.7% in the first quarter. The company continues to see full year shipments of 1.2-1.3 MW.

CFO Andrew Chen said in a statement that gross margin in the first quarter was in line with prior guidance, “with ASP declines in line with expectations and macro trends.” He said that “the benefits of our ongoing cost reduction program were offset by higher than forecasted wafer prices on the spot market, higher polysilicon prices and higher non-silicon materials costs, including silver paste.”

In late trading, CSIQ is down 15 cents, or 1.5%, to $9.65.