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Published: Wednesday, 3/7/2012

Cuts called possible at local First Solar plant

BY KRIS TURNER
BLADE BUSINESS WRITER

First Solar Inc. says workers at its Perrysburg facility are not included in company plans to reduce global production throughout 2012, but an industry analyst said they might have reason to worry.

The Arizona-based solar-panel manufacturer faces an uphill battle as its stock continues to plummet, said Gordon Johnson, managing director and head of equity research at Axiom Capital Management Inc.

UPS AND DOWNS

The adjusted closing price* for First Solar stock at various points since its debut:

Nov. 17, 2006..................$28.30

Nov. 1, 2007...................$237.15

Nov. 3, 2008.................. $124.84

Nov. 2, 2009................... $119.11

Nov. 1, 2010.................. $122.85

Nov. 1, 2011.....................$47.86

March 6, 2012..................$27.63

*Closing price adjusted for dividends and splits.

Source: finance.yahoo.com

First Solar's stock has fallen more than $118 a share since last March and is trading below $28, near its price when the stock first hit the market in 2006.

"Their facility in Perrysburg, Ohio, is at risk of downsizing later this year," Mr. Johnson said, adding that delayed or canceled projects could mean layoffs for some of the almost 1,200 workers there.

Alan Bernheimer, a First Solar spokesman, said no plans to alter production or staffing at the Perrysburg location have been announced. Mr. Bernheimer declined to comment on what could happen later this year at the facility, the company's only U.S. plant.

"That's all I know at this point. We don't have plans at this point," Mr. Bernheimer said. "We announced what we were doing to help make the supply fall in line with the demand picture. Nothing was announced for Perrysburg."

First Solar said recently it would decrease operations at facilities in Germany and Malaysia, delay a plan to open a second U.S. facility in Mesa, Ariz., and abandon a plan for a facility in Vietnam.

"We want to produce product to sell, not to put it in storage or in a warehouse," Mr. Bernheimer said. "Historically, First Solar has run at 100 percent."

First Solar is the biggest maker of thin-film solar panels. It got its start in Toledo and traded at more than $300 in 2008 and about $120 to $150 after a stock split. The stock fell below $100 in August, 2011, and has continued to decline.

Mr. Johnson said problems with solar cells in 2008 and 2009 that deteriorated more rapidly than the projected 25-year lifespan also placed pressure on the firm, raising fundamental questions about the viability of the company's product in the long run.

The company has replaced the faulty panels and is working to ensure they are stable in the coming year, Mr. Bernheimer said.

Contact Kris Turner at: kturner@theblade.com or 419-724-6103.



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