Cautious optimism for Roth & Rau after shaky H1


Having reaped sales of €118.8 million in the first half (H1) of 2010, the German photovoltaic company’s performance declined to €92.8 million in H1 2011. Despite this, its gross performance increased from €149.6 million last year to €152.8 million.

"While the gross performance thus performed in line with expectations, a large share of the sales budgeted for the second quarter of 2011 could not yet be recognized as expected due to delays in the final acceptance of several projects," said Roth & Rau in a statement.

EBIT also suffered, having plummeted from a healthy €6 million in H1 2010 to €-24.4 million in H1 2011.

Roth & Rau says that H1 earnings were "further burdened" by one-off items totaling €12.6 million. These were caused by the discontinuation of the company’s turnkey business, expenses from its CRiSP cost and structure optimization program, and legal and advisory expenses from the Meyer Burger takeover. As such, adjusted EBIT amounted to €-11.7 million.

Orders on hand also fell, from the €351.1 million seen in H1 2010 to €244.3 million this year. Of this, new orders accounted for €111.4 million. Order cancellations, however, amounted to €110.8 million. Taking this into consideration, net new orders actually amounted to €616,000 in H1 2011, as opposed to €265.2 million in H1 2010.

Dietmar Roth, CEO of Roth & Rau AG explained, "The order situation has cooled off noticeably since June 2011. We expect the subdued demand for production equipment, particularly for use in the manufacture of crystalline silicon solar cells in our core markets, to continue in the coming months.

"New high-efficiency technologies are currently being developed in the field of cell production, a further reason for our customers’ current reluctance to invest. We therefore expect positive momentum from the market launch of our latest products in the fields of heterojunction technology and reverse side passivation scheduled for the second half of the year."

While the company believes its earning performance will improve in H2 2011, it remains cautious going forward.

"We have largely remedied the ‘teething problems’ still witnessed by our SiNA 2 equipment in the first half. This means the delayed projects can be accepted in the near future. Recognizing these sales will generate substantial earnings contributions in the second half, thus partly making up for the losses incurred in the first half of the year," said Roth.