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SMA Solar posts flat revenue guidance for 2016 as competition continues to bite

Leading PV inverter manufacturer SMA Solar Technology has guided 2016 revenue to be flat with the prior year as key global markets continue to be price sensitive, driven by utility-scale PV market sectors. 

At its annual analyst day event, SMA Solar guided revenue in 2016 to be in the range of €950 million to €1,050 million, after recently reporting preliminary 2015 revenue of around €1 billion, exceeding revised guidance on higher shipments, notably winning business in the US, due to the exit from the central inverter sector by Advanced Energy. SMA Solar noted that it had secured 70% of Advanced Energy’s contracts last year, 120MW alone from major US EPC firm, Swinterton.

SMA Solar posts flat revenue guidance for 2016 as competition continues to bite

SMA Solar won business in the US in 2015.

The PV inverter manufacturer has continued to lose market share and revenue for more than five consecutive years as the global PV market expanded outside of Germany, historically its largest market and dominated by the residential sector, to three key markets, China, Japan and the US, with SMA Solar only having a strong presence in North America. 

In contrast, SMA Solar’s management claimed it had gained market share on a revenue basis in 2015, noting a four percentage point increase to 21%. 

Overall PV inverter pricing pressure is expected to continue in 2016, according to SMA Solar, resulting in only a moderate increase in sales of PV inverter technology to €4.9 billion, compared to €4.7 billion in 2015. 

However, SMA Solar was bullish on generating further profits in 2016 due to its cost savings and major restructuring efforts last year. EBIT (earnings before interest and taxes) was guided to be in the range of €80 million to €120 million, up from preliminary 2015 EBIT of €30 million to €33 million for 2015. 

SMA Solar was able to reduce its headcount by over 1,700 (full-time and temporary) in 2015, despite not meeting its target for the year. 

SMA Chief Executive Officer Pierre-Pascal Urbon said: “The digitalization of the energy industry will give rise to new business models, for which we have already developed new technological solutions and service offers. In addition to the provision of data to improve the predictability of solar power generation and consumption, the integration of battery-storage systems is also an important topic of the future.”

Tags: pv inverter, sma