Feb. 2 (Bloomberg) — Sharp Corp. said its operating loss
from manufacturing solar cells narrowed in the third quarter as
sales in Japan increased following the introduction of a
government subsidy for the technology.
The loss of 1.9 billion yen ($21 million) for the three
months through Dec. 31 compared with a shortfall of 5.3 billion
yen in the fiscal second quarter and 6.2 billion yen during the
third quarter of 2011. Japan in July started a feed-in tariff
guaranteeing above market prices for solar power.
Sharp, which started in the solar business in 1959 and
remains its oldest major manufacturer, relies on Japan for 80
percent of its sales in the business. It’s trimming operations
in the U.S. and Europe because of the losses in the face of
competition from bigger Chinese panel makers.
“In a fight against Chinese makers, Sharp is not cost
competitive,” Yoshihisa Toyosaki, an analyst at Architect Grand
Design, an electronics research and consulting company in Tokyo,
said by phone yesterday. “Even though the company’s shipments
are increasing, unit prices are falling.” That, he said, means
that volume increase doesn’t boost profit because panels are
cheaper.
Solar sales rose 14 percent worldwide from a year earlier
to 55.9 billion yen. Sharp didn’t give an exact breakdown for
sales and losses between the foreign and domestic solar units.
In a statement to investors, the Osaka-based company said
it’s working to “accelerate business restructuring” by scaling
back its thin-film solar panel manufacturing and its operations
in the U.S. and Europe. Sharp officials at a press briefing
didn’t give details about the plan for the solar business.
“We are reducing the ratio of European and the U.S.
businesses as part of measures to improve our earning
structure,” Sharp President Takashi Okuda said at a press
conference in Tokyo last night. He said the ratio of solar
markets at home and abroad will remain the same for some time.
Sharp plans to sell its stake in an Italian thin-film panel
plant opened in July 2011 with the help of partners Enel Green
Power SpA and STMicroelectronics NV, Kyodo News reported on Dec.
31. It also has a factory for thin-film panels in Osaka.
Sharp opened its factory on the Italian island of Sicily
near Catania in 2011. It’s run by the 3Sun joint venture with
Enel Green Power and STMicroelectronics and makes thin film
cells and modules. Its initial capacity was about 160 megawatts
a year and is the largest solar factory in Italy.
Its other overseas solar plants include one in Wrexham,
Wales, where it boosted output to 500 megawatts in 2011 and
employment to 1,100 people. In Memphis, Tennessee, it has 400
employees making about 160 megawatts of solar cells, according
to Sharp’s website.
Sales of Sharp’s solar products fell during the nine months
ended Dec. 31 by 6.5 percent to 149 billion yen from the same
period a year earlier as declining demand in overseas markets,
especially in Europe, offset growth in the Japanese market,
according to a company filing.
The company raised its outlook for sales in the solar
division for the fiscal year ending March 31 to 245 billion yen,
from 230 billion yen, and expects operating loss to narrow to 11
billion yen from an earlier estimate of 14 billion yen.
To contact the reporter on this story:
Chisaki Watanabe in Tokyo at
cwatanabe5@bloomberg.net
To contact the editor responsible for this story:
Reed Landberg at
landberg@bloomberg.net
