Shares in German solar cell maker Q-Cells AG (QCE.XE) fell sharply Tuesday after the company said it won't reach its production, sales and profit targets in 2008 due to the financial crisis.
Q-Cells said it's lowering its full-year targets because a number of customers have postponed agreed deliveries into next year. The company also warned that a deterioration in project financing conditions and the uncertain market situation would mean demand will remain weak into early 2009.
LBBW analyst Stephan Droxner, who rates the stock at buy, said the profit warning destroyed some investor trust in the company and management, as it came only about a week after Chief Executive Anton Milner in a newspaper interview reconfirmed the outlook, which it had lifted less than a month before.
Q-Cells' shares fell by up to 30% in early trade, but recouped some of the losses. At 0856 GMT, the shares were trading down EUR5.50, or 20%, at EUR21.80, underperforming a lower broader market.
Q-Cells said it now expects production volume in its core business for 2008 to amount to only around 570 megawatt-peak compared with its previous forecast of around 585 MWp.
Consolidated sales are expected to total around EUR1.23 billion, down from the previous forecast of EUR1.35 billion, while consolidated earnings before interest and taxes, the company's operating profit measure, is expected to amount to around EUR205 million compared with the previous forecast of EUR260 million.
Including the expected contribution to income from Renewable Energy Corp. ASA (REC.OS), net income is now only expected to come in at around EUR185 million. Q-Cells previously forecast EUR215 million.