Hoku's 1st quarter loss rises to $2M
Hoku Corp. said its net loss widened to $2 million during the first three months of the year from $904,000 in the same period a year ago as it boosted spending to prepare for the launch of its polysilicon plant in Idaho.
The Honolulu-based clean energy company also announced that it secured a $20 million line of credit to help pay for the Idaho plant, which is expected to begin commercial production of the material used in solar panels and microchips in the third quarter of this year.
For the fiscal year ending March 31 Hoku said it lost $5.4 million, up from the $3 million it lost in fiscal 2009.
The wider loss was due primarily to preparations for a recently completed test run at the polysilicon plant and payments to Idaho Power for reserve power capacity in advance of the launch of production at the plant, Hoku President and CEO Scott Paul said in a news release.
Hoku's ability to demonstrate that it could produce polysilicon in the test was helpful in landing the $20 million credit line with the New York Branch of China Merchant's Bank Co. The loan was guaranteed by Hoku's largest shareholder, Tianwei New Energy Holdings Co. of Chengdu, China.
Hoku also said that it has contracts with six leading solar power companies in China expected to result in future revenue of $1.7 billion from polysilicon sales.
Hoku's customers have committed $148 million in contractual prepayments, $130 million of which already has been received, Paul said.
Hoku is building the Idaho plant under its Hoku Materials subsidiary. Hoku Corp. also installs photovoltaic solar power generation systems through its Hoku Solar unit, which was the sole source of operating revenue in the last two fiscal years.
Revenue for fiscal year 2010 was $2.6 million, down from $5 million in fiscal year 2009. Although photovoltaic installations were up in 2010, revenue fell primarily because of the ownership structure of a one-megawatt project installed for the state Department of Transportation in early fiscal 2010, Hoku said. Hoku, which co-owns the system, is expected to derive revenue from the sale of electricity to the state in future years.
Hoku shares closed yesterday down 12 cents, or 3.8 percent, at $3.05 on the Nasdaq Stock Market.