Trina Solar Limited announced its unaudited financial results for the fourth quarter and full year of 2014. Total solar module shipments were approximately 3.66 GW, an increase of 41.9% from 2.58 GW in 2013.
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Total net revenues were $2.29 billion, an increase of 28.8% from 2013. Gross profit was $385.6 million, an increase of 76.7% from 2013. Gross margin was 16.9%, compared with 12.3% in 2013.
Operating income was $120.1 million, compared with an operating loss of $38.1 million in 2013. Net income for the full year was $61.3 million, compared with a net loss of $72.2 million for 2013. Earnings per fully diluted ADS for 2014 were $0.74, compared with a loss per fully diluted ADS of $1.01 in 2013.
Q4 net revenues were $705 million, an increase of 14.3% sequentially and an increase of 34.1% year-over-year. Total shipments were 1,098.8 MW, consisting of 1,070.5 MW of external shipments and 28.3 MW of shipments to the Company's downstream power projects.
This compares with total shipments of 1,063.8 MW in the third quarter of 2014 and 770.1 MW in the fourth quarter of 2013. The sequential increase in revenues and shipments was primarily due to rising shipment volumes to China, Europe and the rest of Asia. The year-over-year increase in revenues and shipments was driven largely by growing demand from key geographical regions, particularly China, Japan and the U.S.
Q4 gross profit was $111.0 million, compared with $102.8 million in the third quarter of 2014 and $79.1 million in the fourth quarter of 2013.
Q4 gross margin was 15.7%, compared with 16.7% in the third quarter of 2014 and 15.1% in the fourth quarter of 2013. The sequential decrease in gross margin was the result of several factors, including a change in the sales mix, reflecting higher shipments to China and other Asia-Pacific markets with relatively low ASPs, and fewer shipments to Japan in the quarter, which had relatively higher ASPs compared with other markets, coupled with a general decline in ASPs in some other key markets.
The year-over-year margin increase was mainly due to the lower gross profit caused by the disposal and impairment loss on the Company's downstream projects in the U.S. which was recognized in the fourth quarter of 2013.
Q4 operating expenses were $80.5 million, an increase of 19.9% sequentially and 35.7% year-over-year. The sequential increase was primarily due to an increase in salary, wages and benefits to employees.
The Company's operating expenses represented 11.4% of the fourth quarter net revenues, an increase from 10.9% in the third quarter of 2014 and 11.3% in the fourth quarter of 2013.
Operating expenses included a reversal of accounts receivable provisions of 1.0 million in the fourth quarter of 2014, compared with $3 million in the third quarter of 2014 and $9.5 million in the fourth quarter of 2013. This provision reversal contributed to the increase in the operating expense ratio sequentially and year-over-year.
As a result, operating income was $30.5 million, compared with $35.6 million in the third quarter of 2014 and $19.8 million in the fourth quarter of 2013. Operating margin was 4.3%, compared with 5.8% in the third quarter of 2014 and 3.8% in the fourth quarter of 2013. ■