The founding chief executive of a struggling Burnaby solar cell and module company quit and 28 employees were laid off in a desperate bid to remain in business earlier this week.
Day4 Energy, which stopped solar module manufacturing in July, cut its full-time workforce to 108 because the industry is in a “deep crisis.”
The company signed a $4 million letter of intent Nov. 11 to merge operations with Taiwan-based Ever Energy, subject to board, shareholder, court and regulatory approval. The company is kept afloat with a $1.9 million private placement and strategic investment by Wangs Brother Motor Company of Taiwan.
John MacDonald, the original CEO, will remain as chairman but George Rubin became his replacement as president.
Day4 third-quarter revenue fell from $41.3 million in 2010 to $23.3 million in 2011. The company registered a net loss of $9.3 million for the quarter. Cash and liquidity fell from $6.5 million to $2.9 million. Of the $31.3 million in liabilities, $30.1 million is repayable within one year.
“The European sovereign debt issue, an uncertain U.S. economic recovery and severe
(photovoltaic) module overcapacity due to a dramatic manufacturing expansion over the prior year have all contributed to a ‘perfect storm’ in our industry,” MacDonald said.
The industry was rocked by the collapse of Fremont, Calififornia-based Solyndra, which failed despite a $535 million federal loan guarantee from the Obama administration. The Federal Bureau of Investigation raided company offices on September 8, two days after Solyndra went bankrupt.
Several Chinese companies have gained global market share, including New York Stock Exchange-listed Yingli Solar, a sponsor of the 2010 FIFA World Cup in South Africa.
Bob Mackin