POSTED: 1:30 a.m. HST, Aug 6, 2010
Honolulu-based Hoku Corp. said its financial losses widened in the fiscal first quarter as the company boosted spending to complete equipment testing at its polysilicon plant in Idaho.
Hoku lost $2.7 million during the April-to-May period compared with a loss of $905,000 in the same quarter a year earlier, the company reported yesterday.
Most of the company's revenue currently comes from the installation of photovoltaic electrical generation systems while it works to complete its plant in Pocatello, Idaho. The company booked $930,000 in revenue for the second quarter, up from $74,000 a year earlier. Hoku also reported $854,000 in deferred revenue from PV installations and related contracts.
"Looking specifically at last quarter's financial results, our higher loss can be attributed to the cost of successfully completing our reactor production demonstration in April," said Scott Paul, Hoku president and chief executive officer.
"Having completed this critical step in validating our systems, processes and training, we are moving ahead with preparations for our planned production ramp-up and expect to initiate commercial operations this calendar year," Paul said in a news release.
Hoku recently hired 40 additional staff for the plant, including managers experienced in polysilicon production.
Paul said the company is now on a sounder footing than it was a year ago thanks to an equity investment by China-based Tianwei New Energy Holdings Inc., Hoku's major shareholder. Hoku, which was on the verge of shutting down in July 2009 as it struggled to raise financing for its plant, sold a majority stake in the company to Tianwei two months later.
Tianwei's support has allowed Hoku to secure nearly $100 million in debt financing to keep construction on the plant going forward.
In addition, Tianwei pledged "additional capital" this week to ensure that Hoku will be able to meet its initial goals for production of polysilicon, a material used in solar panels and microchips.
"As the solar market continues to mature in Hawaii and elsewhere, we are optimistic about the number of viable projects in the commercial and industrial sector, as well as the number of sizable public solicitations for solar power services being issued by municipal, state and federal institutions. We believe that we are well positioned to compete for this business," Paul said.