Losses nearly halved at Conergy as sales increase almost 40%
A strong boost to sales in the second quarter helped Conergy to reduce losses from the previous quarter to €6.7 million, down from €12.3 million in the previous quarter. Conergy increased sales by almost 40% to €225.2 million, compared to €163.3 million in the prior quarter, but down from €239.4 million reported in the same period of 2010. The dramatic fall in module prices impacted gross profit margin, which fell to 19.1% from 24.6% at the beginning of the year.
Conergy noted, like many rivals that sales were focused on expanding business outside Germany. The expansion of international business sales increased by 36% to €157.2 million, compared to previous year. Conergy noted that 70% of its total sales are coming from outside Germany. In particular, Conergy was able to more than double its sales (€63.1 million) in the Asia-Pacific region in a year. Strong EPC business and project pipeline in Thailand and India were noted.
Though the North American market is expected to double to over 2GW in 2010, Conergy sales to the region are were reported at €13.4 million, up 7.2% compared with the prior quarter and cited stable growth, yet on low level.
The company noted that it had launched its models in the Canadian market and had a ‘promising’ project pipeline in the US, with the first projects under construction.
Sales in Europe, excluding Germany were impacted by a halt in the Italian market in the second quarter, despite meeting Italy’s European content regulations for extra FiT payments.
Though pulling out of the market in Switzerland, Conergy noted that business in the UK had increased by over 600%, while growing over 62% in Greece and 25% in Spain.
On a six month basis, Conergy held its total sales almost constant €388.5 million, compared to €389.7 million in the same prior year period. Foreign share of sales was raised by 48.6% to € 283.9 million, compared to €191.1 million in the prior year period.
Losses for the first six months totalled €41 million.
Citing the difficulty of estimating the development of demand and prices in the second half of the year, Conergy management refrained from providing full-year guidance, though said module prices should fall only slightly, should an anticipated demand pick-up prove sustainable.