As part of the restructure, First Solar will close its manufacturing operations in Frankfurt (Oder), Germany, in the fourth quarter of 2012. Additionally, First Solar will indefinitely idle four production lines at its manufacturing center in Kulim, Malaysia, on May 1, 2012. The actions, combined with other personnel reductions in Europe and the US, will reduce First Solar’s global workforce by approximately 2,000 positions, about 30 percent of the total.
The restructuring initiatives are expected to reduce First Solar’s costs by $30-60 million in 2012 and $100-120 million annually going forward. In addition, the company’s average manufacturing cost is expected to improve to $0.70-$0.72 per watt in 2012 as a result of the changes, below prior expectations of $0.74 per watt. In 2013, First Solar estimates average module manufacturing costs will range from $0.60 to $0.64 per watt.
To achieve the cost savings, First Solar will record restructuring and other related charges of $245-370 million, of which $80-120 million are cash expenditures. First Solar expects to incur these charges primarily during the first quarter of 2012 and the rest over the course of the year.
In addition, First Solar has voluntarily paid down approximately $145 million of debt ahead of schedule in 2012, which represents repayment in full for outstanding amounts under the company’s German loan agreement.
First Solar to close manufacturing base in Frankfurt, Germany
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