Yingli Green Energy received notice from the New York Stock Exchange(NYSE) this week that it was not in compliance with the exchange’s price criteria that must be met in order to remain listed. As of August 12, 2015, the company’s average closing price of their American Depositary Shares, or ADSs, was less than $1.00 per ADS over a consecutive 30 trading-day period. According to NYSE rules, Yingli Green Energy has six months to regain compliance with the minimum share price requirement.
Yingli’s shares dropped 47% in May when they said “there is substantial doubt as to our ability to continue as a going concern” as part of regulatory filing. “Going concern” is an accounting term that is a basic underlying assumption that a company has the resources to continue operating (i.e. generating cash flows sufficient to make debt payments and pay suppliers) in order to operate for a foreseeable time period.
The Chinese solar sector is still plagued by overcapacity even though they supply over half of the world’s solar panels. Suntech and LDK Solar have already filed for bankruptcy protection. Yingli Green Energy is now considered by many analysts to be China’s weakest solar manufacturer. And according to the Wall Street Journal,the Chinese Ministry of Industry and Information Technology (MIIT), the solar sector regulator, is saying consolidation is necessary and the pace should accelerate.
The devaluation of the Chinese currency is one of the only good things that have happened to Chinese solar companies of late. It has made Chinese solar panels cheaper to European and U.S. buyers and may help whichever companies that survive to flourish.
Tracey is an accountant and entrepreneur with a passion for nature. This passion is what spurred her interest in renewable energy, and the rest is history as they say. Tracey is a principal in Energy Think Group, the publisher of Solar Thermal Magazine and Tek-Think. She is also the principal at Women's Financial Help Desk. She spends her free time in the outdoors with her horses and dogs. She loves to travel.