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Conergy suffers EBITDA blow

Rounding off a tough year, Conergy has reported a weaker than expected EBITDA. Price pressure, restructuring costs and project financing delays all impacted on the company’s performance. A continuing difficult market environment is predicted for 2012.

Conergy remains positive, despite losses.

Conergy AG

Looking back over 2011, preliminary calculations show that the fourth quarter (Q4) of the year achieved a paltry EBIDTA of between €-80 million and €-85 million, in comparison to the expected €-50 million and €-55 million.

In addition to the falling costs of modules and a weak financial situation in markets like Greece, Spain and Italy, Conergy attributes its negative performance to its restructuring costs at Frankfurt (Oder), and write-downs on receivables and inventory level reductions.

Meanwhile, the company reports that sales of around €185 million were achieved in Q4, thus bringing its full year group sales to around €755 million, which is in line with its previous guidance. Its "strong" international presence was cited as the reason for an increase in sales volumes.

Conergy added that Q4 2011 operating cash flow was positive.

The German photovoltaic company believes, however, that despite its weak 2011 financial performance, and a predicted tough market environment, it has a "good foundation" for the coming year. Specifically, it says that its "well-considered" decision to reduce inventory levels at the end of 2011 has stood it in good stead.

CEO, Phillip Comberg commented, "In view of the current market environment, we consciously decided to reduce our stock holdings to a minimum. This further affected profit figures in 2011, but we are going forward into the new fiscal year with lean stock and without any liabilities. At the same time, we were able to achieve a positive operative cash flow."

This year, Conergy expects its EBITDA to be "slightly in the black", despite an expected"modest" sales decline.