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Soitec shares plunged 57 per cent on Monday after the semiconductor engineering company said it no longer expects its current operating loss to be significantly reduced in the second half of the fiscal from the first after a US solar project ran into problems.
The company said it would have to scale down its San Diego facility, leading to an impairment charge in the second half of 2014-15, because the project in California under which Soitec had sold 150 megawatts of power purchase agreements will no longer go ahead.
“The main project in the solar division is cancelled,’’ Bryan Garnier analysts wrote. “We had expected the first deliveries on this contract to start from Q4 2014-15. The project was valued at $300 million.’’
“Results should be negative for the next three fiscal years,” the analysts added.
Soitec said it was continuing to “explore new opportunities with its local partners in order to expand its US pipeline” and that it would reassess its 2015-16 targets before the end of the current fiscal year.
The stock was down 53 per cent at €0.99 by 0840 GMT, giving Soitec a market value of about €220 million ($269.7 million). The shares had been up 63 per cent this year. ($1 = 0.8157 euros)
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