Impacted by 40% module price declines, tightening project finance environment and the cancellation costs associated with a wafer supply deal with MEMC, Conergy reported Q3 2012 revenue of €108.0 million, down from €182.4 million in the same period a year ago.
Delayed PV projects, due to financing issues for certain customers meant module sales were down 6% compared to the same period in 2011, to 84MW.
Yet the company was able to capitalise on a strong German market late in the third quarter as module volumes increased by 36% year-on-year, while volumes in Europe overall increased by 3% compared to the same period last.
The decline in revenue was partially due to the continued fall in module prices and weaker demand across European markets. Management noted that module prices had fallen by around 10% q-on-q and 40% y-on-y, due to continued industry overcapacity.
Falling process also had an impact on gross margins. The company reported a gross margin of 16.5% for the first nine months of 2012, down from 19.7% in the same period of 2011.
The company said that certain projects in Germany would incur a delay in transferring to investors, shifting recognition to Q4. The same problem was noted to have occurred in Asia, though the company did not provide further details.
The US market continues to experience strong growth as sales volume increase 51%, compared to the previous year period.
Conergy reported a negative EBITDA of €31.7 million in Q3, primarily due to the €18 million payment to MEMC to cancel its long-term wafer supply deal. Excluding the one time impact, EBITDA would have been negative €13.7 million, indicating losses have been reduced by around 70% over the last year.
Dr. Philip Comberg, CEO at Conergy said: “We have a strong position in Europe, but the third quarter was characterised by a sustained steep decline in prices, funding cuts in Germany and Italy as well as the Euro-crisis. Hence Conergy’s growth markets become more and more important. The significant volume increase in the US and the recently announced 21MW project in Thailand show that we are progressing very well in building up these markets. We are currently working on further expanding our leading market position in Thailand for the coming year.”
The company said that it expected sales for the full-year to be lower than those reached in 2012, while the company expected to report a loss in the mid-double-digit euro million range.
The Conergy Group had cash equivalents of €11.9 million at the end of Q3.
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