SMA Solar reports €1.7 billion in sales for 2011; market share declines

Financials

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    5:35PM GMT+2

Citing an intensely competitive market environment, SMA Solar Technology, the leading PV inverter manufacturer, reported preliminary full-year financial results of €1.7 billion in sales for 2011. SMA Solar had previously cut €200 million from its previous forecast of €1.9 billion to €1.7 billion, with results therefore coming in at the lowered figure. SMA Solar reported 2010 sales of €1.9 billion. Earnings before interest and taxes (EBIT) were reported as being more than €240 million.

SMA Solar revealed an increase in overseas sales to approximately 55%, up from 45% in 2010. According to the company, project business made up about 25% of the Group's sales, up from 18% in 2010. There was also a shift in product mix with increased demand for larger inverters.

Market share manoeuvrings

The company claimed that it maintained a global market share of 35% in 2011, the same as the share in 2010. However, when reporting 2010 results the PV inverter supplier claimed a global market share of between 39% and 45% and 40% share was claimed in 2009.

According to IMS Research, SMA is still the largest supplier of PV inverters in the world but its market share is claimed to be closer to 30%. The disparities occur, according to IMS, because SMA underestimates global demand levels.

Ash Sharma, senior research director at IMS Research, told PV-Tech that by their calculations, SMA lost a lot of market share in Q1, down to 22% but then recaptured a loss share Q2 and Q3.  However this may be at the expense of their Q4 results, according to Sharma, as IMS channel checks were said to have showed that there was a lot of SMA inverters in inventory up to Q3 as SMA’s inventory grew more than its rivals and as a result would have lost share in Q4 as a result.

Key to the market share disparities, according to Sharma is that SMA is underestimating the global demand. Indeed, SMA said in a statement reporting 2011 results that the global PV market installations reached 23GW in 2011, but as PV-Tech reported, IMS and IHS iSuppli are expecting installations to have topped 26GW for the year.

“In late 2011 they [SMA Solar] increased their estimates for global demand in 2010 to 23GW, we estimate it was actually 19.4GW as they’re counting a lot of Italy installations in 2010,” noted Sharma. “Based on their 23GW market size, their share in 2010 would have been 34% in 2010, despite claiming it was 40%.

Sharma also noted that SMA was comparing its shipments with installations to calculate market share. However, Sharma believes that SMA should use total industry shipments (i.e. including inventory) to calculate market share.

2012 guidance

According to SMA it expects slight industry growth in global demand in 2012. Regional markets expected show growth this year includes the US, Japan and India.

However, SMA stated that its management couldn’t provide a reliable forecast for the year, due to numerous changes in important markets and uncertainty caused by the current euro and financial crisis.

As a result, management said that it would at this time be providing a sales and earnings forecast for 2012.

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