Profitability Moves JinkoSolar to Lead Solar Comeback

Interview with JinkoSolar’s Kangping Chen, CEO

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Second-quarter results brought the first profits to the company since Q3 2011. In addition,  JinkoSolar Holding Co., Ltd.(NYSE:JKS) achieved some new personal bests, including shipping 460MW, its most ever in one quarter, moving Jinko to the third position after Trina Solar and Yingli Green Energy. Non-poly processing costs were the lowest in the industry making JinkoSolar an undisputed leader. During Q2 the company had the highest gross margins among all Chinese solar companies listed in the US.  In a brief conversation with SPVI about Jinko’s recent successes is CEO Kangping Chen.

Kangping Chen, CEO JinkoSolar

SPVI: Congratulations on the great result and profitability. In the news release describing the second quarter, Jinko announced the addition of 300MW of capacity. Can you please describe what sort of improvements these include?

Kangping Chen: Thank you. The addition of 300MW capacity can be attributed to the following reasons. Firstly, Jinko upgraded existing key equipment to maximize its turnover. Secondly, we further enhanced module output range, thanks to increased efficiency of solar cells. For example, the power of a standard 60-cell polycrystalline module of 260 watts has been boosted to 265 watts. Thirdly, the state-of-the-art fully automated production lines and optimal workshop layout minimized idle time of machines, improving efficiency.

SPVI: Jinko has achieved $0.41 per watt for non-poly processing costs during Q2. The poly costs were $0.09 per watt – what is the contributing factor?

Kangping Chen:  Our focus on continuous increase of efficiency, while maintaining higher quality of our product, is the only way to keep cost competitive.

SPVI: Based on SPVI Research, it appears that the EU made up about 48% of overall global exports for Jinko during the first half of 2013. Could you describe the impact of the EU quota?

Kangping Chen:  Because of our forward thinking and focus on global diversification, we suffered less from EU quota implications than our peers.

SPVI: Other large export destinations during the first half of 2013 were India with 54MW and South Africa with 40MW, while Japan was around 10MW.  What other high-ASP areas are destinations for H2?

Jinko: The high-ASP regions for Jinko will include Japan, South Africa, and Australia, with the previously announced balance of shipments to South Africa in the range of 300MW and Japan in the range of 100 to 150MW

SPVI: JinkoSolar has 55MW of solar plants completed and 146MW in construction. Do you have plans to sell the projects or keep them for income generation?  

Kangping Chen: Our primary objective is to keep solar plants for the income generation.

SPVI: What is the estimated gross margin of your projects in China? 

Kangping Chen: The margin of solar PV projects varies depending on many factors, for example: irradiation, location, availability of grid connection, etc., will affect the outcome, but on average we expect margins to be 15-20%, while the best-case scenario could be as much as 30%.

SPVI: On the topic of China’s FiT, Canadian Solar stated recently that FiT payments and saleability of Chinese projects remains a concern since payments have lengthy delays.  Can you explain your position on this situation?  Do you have plans for solar plants abroad?

Jinko's solar farm in Canada

Kangping Chen: Delay of payment does exist, but we witnessed different parties making great progress to solve this problem. We believe the situation will improve in time. We have plans for solar plants development abroad, and actually we have been active in this business segment as of recently.

SPVI: Thank you very much for the opportunity to discuss the company with you, Mr. Chen

Kangping Chen: Thank you!

This interview was conducted by Robert Dydo, and edited by Senior Editor of SolarPVInvestor, Stephanie Pierce.