Thursday, July 5, 2007

China Sunergy Announces Preliminary Sales and Production Volume Figures for the Second Quarter 2007

Detailed Financial Results for the Second Quarter to be Released August 24th 2007

July 03, 2007: 08:02 AM EST

NANJING, China, July 3 /Xinhua-PRNewswire/ -- China Sunergy Co., Ltd. , a specialized solar cell manufacturer based in Nanjing, China, announced today preliminary sales and production volume figures for the second quarter 2007. These figures are preliminary and have not been subject to any review procedures so may be subject to change once detailed reviewed financial results for the second quarter are disclosed on August 24th, 2007.

During the second quarter of 2007, China Sunergy produced 20.1MW of solar cells which represented a 93% increase on a year-on-year basis and was largely the same as the first quarter of this year. Monocrystalline 125-millimeter cells continued to account for the majority of production and sales at 85% and 88% respectively. The average conversion efficiency rate for this product during the second quarter of 2007 was 15.9%, which was largely the same as the average efficiency rate achieved during the first quarter this year. Based on preliminary information, quarterly shipments (including OEM volumes of 1.1MW for cell sales and 0.4MW for module sales), amounted to approximately 19.0 MW, compared to 9.2MW during the second quarter 2006 and 18.3MW during the first quarter of 2007 on a like for like basis.

China's solar market continued to experience a tight supply of polysilicon during the second quarter. Although the situation has improved from a year ago, the relatively tight supply of polysilicon affected the quality, quantity and delivery of wafers and drove up overall wafer prices in the spot market, resulting in increased pressure on China Sunergy's margins.

Key raw material procurement and sales related developments are as follows:

-- In June 2007, China Sunergy entered into three supply contracts and
framework agreements with LDK Solar Co., Ltd, Konca Solar Cell (Wuxi)
Company Limited and Changzhou Xiandai Communications Optic Fiber Co.,
Ltd for a net supply of a total of approximately 11.9 million and 4.4
million monocrystalline 125-millimeter and multicrystalline 156-
millimeter wafers for the second half of 2007 and 2008 respectively.
The volume for the net supply would translate into approximately 16MW
and 28 MW of solar cell production for the said periods. The pricing
terms are generally subject to negotiation on a quarterly basis and
prepayment ranges from nil to 30% of the contract value; and

-- In the same month, China Sunergy also entered into a 10MW sales
contract with Solarwatt AG, a leading solar module manufacturing
company in Germany, for the second half of 2007 with a total contract
value of approximately EUR21.7 million; To facilitate sales of our
China based module making customers, enhance our profitability and
better understand our end-user market, China Sunergy adopted a new
business model where we purchase a certain quantity of modules from our
module making customers and sell them, on a trading basis, to certain
European based system integrating companies that our Chinese module
making customers do not have access to. On this basis, we sold
approximately 0.4MW of modules that we bought from our China based
module making customers largely to a German based system integrator.

Revised and new contracts with some of China's top wafer manufacturing companies, LDK, Changzhou Xiandai and Konca Solar, demonstrate China Sunergy's continued ability to procure wafer supply contracts and provide comfort that we will be able to achieve higher production and sales volumes during the second half of the year. Through our enhanced procurement efforts, expected higher portion of 156-millimeter wafer supply, and more scalable commercial production of higher efficiency selective emitter cells, China Sunergy targets to produce a total of 55-70MW of solar cells during the second half of the year, which implies an annual production target range of 95-110MW.

Mr. Tingxiu Lu, Chairman and CEO of China Sunergy, commented: ''To address the supply challenges, we continue to work on expanding our existing key supplier relationships and sourcing new suppliers. As a result of the new supply agreements we reached during the second quarter we are now confident that we will be able to secure our wafer supply requirements for the second half of 2007 and 2008.

Our sales strategy continues to focus on diversifying our customer base and increasing sales to European customers. The recent sales agreement with Solarwatt is an example of how we have been able to successfully expand our European sales footprint by establishing significant relationships with customers outside China. As these customer relationships continue to develop we expect European sales to rise to approximately 30% of overall sales for the full-year 2007."

Solar cell group raises £30m


AIM dealings start on Friday in Jetion Holdings, a Chinese maker of performance solar cells and modules, after it raised £30.5 million.

Dipesh Shah, former boss of BP Solar International, is chairman and Lijin Gai, ex-director of New York-listed Suntech Power Holdings, is chief executive officer of Jetion. The company supplies solar cells and components, and Photovoltaic energy systems to industrial users from its base in China's Jiangsu province, two hours from Shanghai. Broker Collins Stewart is nominated adviser to Jetion, whose directors have sold nearly five million shares into the float, which values the company at £112 million.

Jetion's turnover exceeded £22.7 million last year and it is now making money. The company said it will use the float proceeds to boost annual production capacity to 100 megawatts.