GREENVILLE — United Solar Ovonic's plans to double production at its Greenville plant isn't just good news for the struggling local economy.
Parent company Energy Conversion Devices Inc. — manufacturer of thin-film flexible solar laminate products for buildings and rooftops — watched its stock shoot up more than 43 percent in a day. The stock, which trades under ENER, closed Thursday at $49.91 on the Nasdaq.
Wall Street was pleased with news the Rochester Hills-based company marked its first quarterly profit in the third quarter, fueled by United Solar's strong growth.
The trend is expected to continue, thanks to more than a year backlog of orders.
But doubling production capacity in Greenville doesn't require the same increase of the plant's work force, which will number 400 when the second building ramps up in January
"I know we will be hiring more people, but we won't be doubling the number," said company spokeswoman Tracey Rettig.
Set to begin later this year, the expansion is expected to cost up to $250 million over the next two years.
Overall, the company will spend up to $310 million to complete construction on the first four lines and expansion.
The company plans to take a thrifty approach to expansion by adding four new lines in its two existing Greenville facilities instead of constructing two new buildings.
The site can hold up to six factories.
"There is always a possibility of additional buildings, but right now we are going to start with additional lines," Rettig said.
Better use of production space along with other changes is expected to save about $26 million, including a $2 million reduction in annual operating expenses, said Mark Morelli, Energy Conversion Devices' president and chief executive officer.
By reducing the costs, the company can fund the expansion with available funds and cash flow from operations.
The company reported third-quarter profits of $7 million or 17 cents a share.
In the previous quarter, the company had a loss of $5.4 million, or 14 cents a share in the prior quarter. In the same quarter a year ago, the firm had a loss of $6.9 million, or 17 cents a share.
Revenue doubled to $70 million from $27 million in the year-ago period for the third quarter ending March 31.
"I'm pleased to report that we've reached profitability, and we've done so through sustainable changes to our business. This is a key milestone in our company's history," said Morelli, who joined the firm last summer.
