LDK Solar reports further loss but announces new wafer contract
LDK Solar has announced that its Annual Report on Form 20-F, which includes audited financial statements for its fiscal year ended December 31, 2012.
During the course of the preparation of LDK Solar's 2012 annual report, LDK Solar's management determined that an additional provision for warranty and long-term contract termination penalty of approximately $14.8 million and a reversal of previously recognized gain on restructuring of payables of approximately $21.0 million were required to properly adjust previously announced preliminary unaudited financial results for the fourth quarter ended December 31, 2012.
The additional provision for warranty and long-term contract termination penalty was based on updates in LDK Solar's negotiation with relevant counterparties regarding the settlement plan for the contractual obligations under certain contracts. The reversal of previously recognized gain on restructuring of payables was adjusted to reflect the increased risk of reversal of previously agreed discount, because of recent non-performance of certain contractual terms under a payable restructuring contract.
LDK has also announced that it has signed a wafer supply contract with Realforce Power Co., Ltd, a photovoltaic (PV) company located in Shandong Province, China. Under the terms of the agreement, LDK Solar will provide 120 million 6-inch wafers, totaling approximately 500 megawatts (MW), with shipments commencing in May 2013 through December 2014.
"We are pleased to enhance our market position in the China region through this new wafer sales agreement," stated Xingxue Tong, President and CEO of LDK Solar. "We believe the China region, which is expected to reach 10 gigawatts (GW) in 2013, represents the strongest global growth opportunity. This contract demonstrates the continued demand for our solar wafers. We are confident that our high quality wafers can meet new market requirements," concluded Mr. Tong.
