German solar inverter manufacturer SMA Solar has published its latest financial results, reporting sales of €759.3 million (US$829.4 million) in the first half of the year, compared to €778.9 million (US$850.8 million) in the first half of 2023.
The company described its results as “solid” in a “challenging market”, with a number of weaker financial results than in the first half of the previous year. The company’s earnings before inflation, taxation, depreciation and amortisation fell from €125.3 million (US$136.9 million) to €80.6 million (US$88 million), while the order backlog for its products almost halved, from €2.5 billion (US$2.7 billion) to €1.4 billion (US$1.5 billion).
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SMA Solar’s financial performance has also worsened half-on-half. The graph below demonstrates how, in neither the first nor second quarter of this year, its sales volume exceeded €400 million (US$436.9 million), whereas both the third and fourth quarters of 2023 saw sales volume exceed this total. The distributed sectors in particular struggled, with both the commercial and industrial (C&I) and residential sectors reporting less than €100 million (US$109.2 million) in sales in each of the first two quarters of this year.
“The global PV market has developed very inconsistently this year,” said SMA Solar CEO Jürgen Reinert. “Incoming orders in the home and C&I segments continue to be influenced by the high inventory levels at distributors and installers. In addition, electricity prices have gone down, which in many countries is resulting in postponed investments and restrained final demand, as well as excess capacity by Chinese manufacturers, which is putting additional pressure on the market.”
The oversupply of solar products to Europe, particularly from the Chinese market, is nothing new. Last year, S&P Global’s Edurne Zoco told PV Tech Premium that a “toxic” stockpile of Chinese modules had reached the European market, with supply of new modules vastly outstripping demand, and in the first half of this year, Europe was responsible for importing close to half of all Chinese PV exports.
However, SMA’s utility-scale business has flourished in this environment. In the second quarter of this year, its sales of inverters for the large-scale sector reached €307 million (US$335.3 million), more than double the sales volume of the second quarter of 2023. This is in line with the high of €327 million (US$357.2 million) achieved in the final quarter of last year, and builds on a strong performance in the utility-scale sector achieved in the first quarter of this year.
The challenging European market has also contributed to a shift in the distribution of SMA’s sales figures. In the first half of 2023, Europe, the Middle East and Africa (EMEA) accounted for 75% of the company’s €779 million (US$850.9 million) of sales volume, across all sectors of the solar industry, while the Americas accounted for just 20%. In the first half of this year, as total sales volume has remained relatively stable, at €759 million (US$829.1 million), the Americas accounted for 41% of sales, compared to 50% in EMEA.
Looking ahead, SMA expects relatively strong sales figures for the remainder of the year, perhaps inspired by the company’s strong performance in the utility-scale sector and the Americas market.
The company has confirmed its revised sales forecast of between €1.6-€1.7 billion (US$1.8-1.9 billion) by the end of this year, some 10-20% lower than the the €1.9 billion (US$2.1 billion) of total sales volume achieved in 2023.
However, the company expects its earnings to fall considerably more, from €311 million (US$339.7 million) in 2023 to between €80-130 million (US$87.4-142 million) by the end of this year.
