- Sales in Q2 2009 of € 163.4m thanks to increased demand
- Gross profit margin rises to 18.5 percent compared to same period last year; positive net cash flow
- Operating profit burdened by special items
- Expectation: market will continue to grow in second half of 2009. Aim: operating profit in 2010
- Sales of € 228m in first half of 2009 significantly under those of record year 2008, but earnings after tax slightly improved
Hamburg, 13 August 2009 – Thanks to the upturn in the global solar market, the Hamburg-based photovoltaic specialist Conergy has almost tripled its sales to € 163.4m in the second quarter, compared to the previous quarter. Furthermore, Conergy has increased its gross profit margin by 4.3 percentage points to 18.5 percent in the first half of the year, compared to the same period last year. A positive net cash flow of € 17.3m from the operating business reflects, above all, more efficient relations with stock and much lower receivables from deliveries and services.
In contrast to the record volumes of 2008, Conergy recorded a clear decline in sales in the first half of 2009 to € 228m. Reasons for this are a sharp drop in solar module prices and the dramatic slump in the Spanish market; a market which had contributed to an extraordinary boom for the solar industry in 2008. In addition, the financial crisis caused a credit squeeze that made – and is still making – access to external financing more difficult for investors in all key photovoltaic countries. There has also been a sharp drop in module prices, with prices falling by around 30 percent thus far. This has put sales in the industry under yet more pressure.
Conergy’s operating profit (EBIT) was significantly affected by the drop in sales: at € -47.0m, it was even lower than the deficit of the first half of 2008 (€ -33.3m). However, thanks to the restructuring programme, the company improved its earnings after tax in the first half of 2009 from € -66.9m to € -58.9m. This was achieved particularly by the reduction of personnel costs by approximately 27 percent by the end of June 2009, compared to end June 2008, as well as by the significant reduction of net debt from € 550.0m to € 287.1m. The equity ratio as per 30.06.2009 continues to be robust at 21.4 percent.
“We are especially pleased that we have once again achieved a positive net cash flow. Moreover, apart from the exceptions of Spain and Korea, our markets have developed positively and are at the same level as they were last year. This reflects three key points: That we have been able to retain our market position in markets which will be important in the future. That our fundamental growth drivers remain intact. And that we can therefore expect the classic pattern of further recovery in the second half of the year”, said Dieter Ammer, CEO of Conergy AG. “Although the market is picking up again, it is certainly not strong enough for us to be able to repeat the record volume of 2008. Whilst our restructuring programme has made us more streamlined and efficient, the drop in sales was too large for us to compensate for with the cost-cutting measures we implemented last year.”
Conergy aims to effectively respond to these structural changes. The company has therefore introduced measures to make it more efficient, ensure further cost savings and align capacity with the current market situation.
Last month, Conergy eliminated the regional model for international distribution and sales, and thus removed a whole management level. Furthermore, the strengthened corporate purchasing, logistics and marketing divisions will provide relief for the countries through the creation of a strong infrastructure – this will enable the countries to focus more on their distribution and sales activities. The solar company is closely inspecting all regional markets once again regarding profitability. As announced at the start of the restructuring programme, the aim is to limit business to countries where a profit can be made. In addition to this, Conergy is strengthening its distribution and sales channels. The German B2B channel has developed positively in the past few months: in the future, the company hopes to improve this channel even further.
Outlook
Conergy expects further recovery for the renewable energy market in the second half of 2009. The international political climate remains favourable towards the continued development of renewable energy markets. The company expects that the classic cycle – the second half of the year usually has higher levels of sales than the first in this industry - will also shape 2009. Overall, however, the volumes achieved by the photovoltaic market in 2009 will be less than those of the exceptionally strong previous year. The Management Board believes that the sales volume for Conergy in 2009 will be significantly below that of 2008, but that the relative market share should remain. As a consequence of the reduced sales volume, the Management Board expects an operating loss this year. The company aims to make an operating profit once again in 2010. |