SMA Solar Technology to significantly increase profitability in the first quarter of 2021
Overview of Q1 2021:
- 3.4 GW inverter output sold (Q1 2020: 4.4 GW)
- Sales of €240 million (Q1 2020: €288 million)
- Earnings before interest, taxes, depreciation and amortization (EBITDA) increased to €20 million (Q1 2020: €12 million)
- Equity ratio still high at 42% (December 31, 2020: 42%)
- Managing Board confirms sales and earnings guidance for fiscal year 2021
SMA Solar Technology AG (SMA/FWB: S92) achieved a considerably better operating result from January to March 2021 than in the first three months of the previous year. EBITDA increased significantly to €20.1 million (EBITDA margin: 8.4%; Q1 2020: €12.3 million, 4.3%). In the first quarter, the SMA group sold inverters with an accumulated output of around 3.4 GW and generated sales of €240.4 million (Q1 2020: €287.9 million). The lower sales year on year resulted mainly from the postponement of orders due to the global coronavirus pandemic and an increase in the price of PV modules. In addition, sales in the first quarter of the previous year included an unusually large project in the U.S. The previous year’s quarter is therefore suitable only to a limited extent as a reference period.
Net income improved to €8.0 million (Q1 2020: –€0.3 million). Earnings per share thus increased to €0.23 (Q1 2020: -€0.01). At €226.7 million, net cash remained at the same high level as at the end of the previous year (December 31, 2020: €226.0 million). The equity ratio also remained constant at 41.7% (December 31, 2020: 41.8%). In addition, SMA has a credit line of €100 million from domestic banks.
“Despite weaker demand due to project postponements, we achieved a considerably better operating result in the first quarter of 2021 than in the same period of the previous year,” said SMA Chief Executive Officer Jürgen Reinert. “To further support our profitability, we also intend to continue optimizing our product portfolio and reducing costs over the coming months. Furthermore, against a background of greater vaccination coverage and reduced economic uncertainty, especially in the second half of the year, we expect an increase in demand in our core markets in Europe and the U.S. The most recent political signals are extremely encouraging for medium- to long-term market developments. The EU has confirmed its commitment to a 55% reduction in greenhouse gases by 2030. For the U.S., President Biden has announced an infrastructure program entailing major investment in a more climate-friendly economy. At Biden’s climate summit, not only the U.S. but also many other major national economies pledged to ramp up their climate targets. Following the ruling of the Federal Constitutional Court concerning climate protection law, the German Federal Government has now also announced that it will – among other things – increase the installation targets for renewable energies, thus making good on a demand that we also made some time ago. To achieve a secure, climate-friendly electricity supply, we need at least 15 GW of new PV generation capacity in Germany every year.”
SMA’s Managing Board is keeping a close eye on the currently tight situation in the supply of electronic components. So far, there has not been any impact on output quantities. The Managing Board will also closely monitor ongoing developments relating to the coronavirus to ensure it can respond quickly and flexibly to any sudden increases in demand. The SMA Managing Board confirms its sales and earnings guidance for the 2021 fiscal year as published on February 5, 2021, which forecasts an increase in sales to between €1,075 million and €1,175 million and EBITDA of between €75 million and €95 million. The Managing Board assumes that SMA can strengthen its position in key markets over the course of the year and benefit from the expected growth of the PV markets in Europe and America as well as that of the global storage market. The continuous improvement of the product portfolio and the implementation of further cost reduction measures will continue to support SMA’s profitability.
The quarterly statement for January to March 2021 can be found at www.SMA.de/IR/FinancialReports. SMA’s virtual Annual General Meeting will be held on June 1, 2021.
Source: SMA SOLAR TECHNOLOGY
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