Sunways Q2 and H1 sales drop over 40 percent

In line with current market conditions, Sunways has recorded both a flat Q2 and H1 in 2011. The reason for the company’s poor performance has been attributed to reduced demand, particularly in Germany, and "massive" price pressure.

Consequently, sales in Q2 2011 showed a 40 percent decrease on Q2 2010, generating just €38.7 million in comparison to €64.6 million. H1 sales also significantly dropped from last year, this time falling 44.1 percent, from €108.9 million in 2010 to €60.9 million in 2011.

Q2 EBIT also took a marked hit, tumbling from €5 million in 2010 to €-6.3 million in 2011. The same goes for Sunway’s H1 EBIT, which fell from a positive €9.7 million to a very negative €-9.8 million.

On a more positive note, the company recorded growth in its international sales, which went from €13 million in Q2 2010 to €19.4 million in Q2 2011. These sales, it says, were mostly generated in Europe.

It goes on to explain that around 70 percent of its non-domestic sales were made in Italy, where the market has picked up following the outcome of its new Conto Energia.

In terms of the first six months of the year, international sales grew by 61 percent to reach €32.3 million. "This positive development," said the company, "was in particular supported by the solar module segment."

Solar module volume sales were said to have "reached a new high" in Q2 2011, having increased by 5.6 megawatts on the previous year’s quarter, which saw 16.1 megawatts peak sold. Financially speaking, Q2 2011 sales in this segment reaped €29.1 million in comparison to €29.7 million, and an EBIT of €-3.6 million, in comparison to €0.7 million. Meanwhile, H1 sales dropped marginally from €48.4 million in 2010 to €45.5 million in 2011.

Sunways adds that module selling prices fell by about 13 percent on average during the period from March through June 2011.

Although they failed to reach Q2 2010 levels (€9.8 million), at €8 million solar inverter sales did recover in the second quarter from Q1 2011. For H1 2011, sales fell from €18.9 million to hit €11.1 million.

Q2 cell sales also decreased on the previous year, with sales falling from €31.1 million in Q2 2010 to €26.5 million in Q2 2011. Furthermore, H1 solar cell sales decreased from €52.9 million in 2010 to €34 million in 2011.

Looking ahead, the company states that a reliable prognoses cannot be made for the full year in light of the difficult and fluctuating market conditions. However, in a statement, it did say, " … we expect to experience a more positive development in the remaining two quarters than in the first half of the year."

Commenting, Michael Wilhelm, chairman of the Management Board of Sunways added, "Enterprises like Sunways are particularly affected by the pressure on prices for photovoltaic components since our value added is largely generated in Germany. To improve our results, we have initiated numerous measures on the sales and cost side which will be consistently pursued in the second half of the year."