First Applied Materials remains to push market supremacy in PV module films service

• Market leading PV module film product manufacturer, First Applied Materials has reported rising earnings on the back of expanding demand, raised capacity and higher ordinary market price (ASPs) for the 4th quarter and also full-year 2020.

The market leader in PV backsheet materials had the ability to rebound strongly from the effect on its operations from COVID-19 in the first quarter of 2020, and reported 3 successive quarters of record income coupled to 2 consecutive quarters of record web profits. Fourth quarter internet earnings of RMB698.71 million (US$ 106.4 million) were virtually double the US$ 55.73 million reported in the 4th quarter of 2019.

Net earnings in the first quarter of 2020 had taken a major hit as a result of the effect of COVID-19 on the firm's capability to acquire raw materials in addition to experiencing major logistical restrictions. Web profit in fourth quarter of 2019 had actually been around US$ 55.7 million, however dropped to around US$ 23.6 million in the first quarter of 2020.

However, First Applied's web profits bounced back highly in the second quarter as well as soared in the 4th quarter of the year.

The business reported record web income of roughly RMB2.92 billion (US$ 446.96 million) in the 4th quarter of 2020, up from around US$ 273 million in the previous year period.

Overall yearly profits gotten to around RMB8.39 billion (US$ 1.28 billion) in 2020, up from around US$ 975 million in 2019, a 31.6% boost, year-on-year.

Yearly sales volume of overall PV film (encapsulants) was 865 million square meters, a year-on-year increase of 15.57% from 749 million square meters in 2019. However, sales growth in 2019 had been 28.88% higher than in 2018.

Sales quantity in the 4th quarter of 2020 reached 268 million square meters, a boost of 20.78% month-on-month.

ASPs boosted quarter-on-quarter in 2020 because of supply restrictions and succeeding solid demand. The firm noted that ASPs increased 18.67% in 2020.

The business also offered 57,120,300 square meters of PV backsheets, a year-on-year increase of 14.98%. The complete operating revenue of the PV product segement was over RMB 812 million (US$ 124 million), a year-on-year increase of 30.50%.

The business approximates that 1GW of PV module setting up manufacturing requires around 10 million square metres of PV film.

Complete PV film market share was claimed to have raised from around 50% in 2019 to between 55% to 60% in 2020.

This was partly driven by raised sales quantities right into existing significant PV makers that have been raising capacity throughout 2019 and 2020. The firm is a major distributor to 'Solar Module Super League' (SMSL) members such as LONG Solar, JinkoSolar, Trina Solar, JA Solar Canadian Solar, Q CELLS, along with First Solar for its CdTe thin-film manufacturing plants in Malaysia as well as Vietnam.

First Applied is additionally a significant supplier to CHINT and also Suntech.

It must also be kept in mind that competing PV backsheet producer Cybrid Technologies, which went public in China last year, reported full-year income of around US$ 333 million in 2020. Profits and internet earnings both increased by just over 2%, year-on-year.

Production update

First Applied remained to increase PV film capability in 2020, reaching a nameplate of capacity of 1.051 billion square meters by the end of the year, a year-on-year rise of 41.07%.

According to First Applied's 2020 annual report, in the first half of the year its 500 million square meter PV film project (possibly catering for 50GW of PV module manufacturing needs for PV films) in Chuzhou was anticipated to begin large building and construction of manufacturing facility structures and also supporting facilities in the first half of 2021.

The business's Jiaxing's 250 million square metre (25GW) of PV film expansion project, which is anticipated to set you back around US$ 156 million), was slated to begin building in the fourth quarter of 2020.

The firm anticipates overall nameplate capability to be around 1.4 billion metres by the end of 2021.

First Applied is additionally one of the few PV firms that has never minimized R&D costs in any type of given year. The business considerably raised R&D expense to US$ 46 million in 2020, up from around US$ 28.5 million in 2019, around a 60% rise year-on-year.

Along with materials and solutions, the business's R&D investment includes investment in tools and procedures in addition to the establishment of First New Materials Research Institute, geared up with innovative experimental tools and also screening devices, and also has a national-level enterprise technology facility, Zhejiang Provincial Key Enterprise Research Institute, Zhejiang District Photovoltaic Packaging Materials Engineering Technology Research Center, post-doctoral research workstation, as well as a CNAS examining center.