Trina Updates Guidance (Part 1)

Trina issued updated guidance yesterday. This unsurprisingly included an turn a profit downgrade together with a turn down inwards margins. Somewhat to a greater extent than surprisingly it included a massive shipment book downgrade.

To quote:

The Company estimates its solar module shipments inwards the 3rd quarter of 2011 to live inwards the hit of 372 MW to 375 MW, compared to the Company's previous guidance of 480 MW to 520 MW for the reasons discussed below.

And the reasons discussed below are:

A deflationary pricing surround impacted yesteryear challenging financing weather for some of our customer's European projects resulted inwards the shortfall of our targeted shipment volumes.

This guidance was for the stream ended thirty September 2011.

The turn down was - unsurprisingly blamed on challenging financing conditions in Europe.

The argue why a huge shipment book downgrade was surprising was because the lastly guidance was given inwards a conference telephone phone on 23 August 2011, in other words when the quarter was more than one-half done.

And inwards that conference telephone phone they truly saw a pickup inwards ask inwards Southern Europe. To quote:

Mark Kingsley (COO): I convey been waiting for Italia since I got here. So, nosotros are truly seeing some practiced action finally. And nosotros convey some pickup inwards activity. We run into it. Obviously, our historic Italian describe of piece of occupation organization human relationship is at the utilities. We every bit good run into Castilian accounts that a lot of them truly served projects there. So, later much waiting together with unclarity, nosotros are seeing some pickup inwards demand. There is – nosotros withal convey a mix of utility projects inwards commercial rooftop there. And hence what nosotros are seeing moved quicker was the materials that was utility that was finishing off together with straight off it’s blending into commercial rooftop.

Now Mark Kingsley's comment was non forrad looking. They were "actually seeing some practiced activity" inwards Italia together with "some pickup inwards demand" inwards Spain. These were historical comments non protected yesteryear the diverse safe-harbors inwards the securities law. So they must live truthful or Mark Kingsley is going to live bailiwick to securities fraud claims. And Mr Kingsley is non a Chinese executive - he has to alive amongst his historical comments hence I figure he must be telling the truth.

Whatever: book came inwards to a greater extent than than xx per centum lower than an gauge made inwards the lastly one-half of the quarter. 

Presuming every bit I create that Mark Kingsley was telling the unvarnished truth every bit it was on 23 August hence ask inwards Europe must convey fallen or hence goose egg for the residue of the quarter.

That is fifty-fifty worse than I thought.

John