Due to its losing its largest customer, Enfield-based STR Holdings will close its East Windsor operations by the end of the first quarter of this year, according to a press release from the company.
STR Holdings, a manufacturer of covers for solar panels, reported last week that it expected the loss of First Solar, which accounted for $39 million of sales with STR in 2012, as a customer.
“First Solar is STR’s largest customer and such loss is likely to have a material adverse effect on the business and financial results of the Company,” STR reported in a press release.
Robert Yorgensen, STR president and chief executive officer, did not provide a reason for First Solar’s decision to move to a different supplier, only commenting in a press release that there was no claim of a defective product, nor were there any returns.
“We have enjoyed a very long and prosperous relationship with First Solar,” Yorgensen said in the statement. “Unfortunately, I cannot elaborate on their decision to work with another supplier at this time.”
The Hartford Courant reported that “[t]he loss comes as revenue declines have taken hold at STR, amid a glutted market for solar panels that has chewed up and spit out a number of solar panel-makers and their suppliers. Sales at the company peaked in 2008 at $288 million, then slid to $232 by 2011 and an expected $94 million for 2012.”
Joseph C. Radziewicz, vice President and chief financial officer, said, “While the loss of First Solar as a customer is certainly an unfortunate development for STR, we have already taken swift action to reduce our costs, which will help to preserve our strong balance sheet as well as our options going forward.”
STR acquired the 275,000-square-foot building located at 96 Newberry Road in East Windsor from WRT Management for $4.9 million in February 2011.
It is not yet known how many employees will be affected by the shutdown of the East Windsor location.
The town, however, will not realize too much of am impact - at least directly - in the form of loss in tax revenue.
According to records provided by the East Windsor tax collector's office, STR paid $114,000 in real estate taxes last year. That will likely continue, regardless of whoever owns the property, a representative in the tax collector's office said.
STR had an exemption from paying taxes on personal property and equipment, the records showed. The town collected just over $1,200 last year in those taxes.
It is unclear, however, how much East Windsor, and other neighboring towns, will be affected by any job losses as a result of STR ceasing its operations in East Windsor.