S.A.G. Solarstrom shows increased 2011 sales, but falling EBIT


The German solar company saw positive growth, both in its international sales, and Project Planning and Plant Construction business segment. Overall, it says that sales increased by 31.2 percent to reach €264 million, compared to €201 million in 2010, which fell within its previous target of sales between €260 million and €280 million. Of this figure, 73 percent was made abroad.

A positive operating result of €6.2 million was additionally seen, although this figure fell flat when compared to the €13.1 million made in 2010. EBIT was particularly hard hit, having fallen from €3.3 million in 2010, to €-2million in 2011. Initially, the company expected to achieve an EBIT of between €16 million and €18 million. The "extraordinary competitive situation" in Germany was cited as the main reason.

A serious dent to the balance sheet was seen in S.A.G. Solarstrom’s 2011 operative cash flow, which fell to €-61.3 million. This was said to be due to the company’s Serenissima project in Italy. "The project was sold to a subsidiary of BNP Paribas Clean Energy Partners on December 31, 2011, however the purchase price was only paid in Q1 of 2012. The effects already leveled out with the payment of the purchase price in the first quarter of 2012, so that the S.A.G. Solarstrom Group will disclose a positive operative cash flow and a considerably lower balance sheet total at March 31, 2012," it explained in a statement released.

"The financial crisis also caused an above-average increase in financing costs, which were reflected in the consolidated annual result of -€3.5 million (2010: €6.3 million)," continued the company statement.

Looking ahead to 2012, it said it will develop its business into new markets outside of Europe. It is also looking to "substantially increase" its sales volumes in Project Planning and Plant Construction, and Partner Sales.

"As a roof-top specialist and service provider, we are very well placed for 2012, a business year that will most certainly not be easy either," commented CEO Karl Kuhlmann.

Business segments

Looking at S.A.G. Solarstrom’s individual business segments, Project Planning and Plant Construction performed most pleasingly. Sales in this area were said to have grown 62.7 percent to reach €201.5 million (2010: €123.8 million). The sale of its 48 megawatt peak (MWp) Serenissima project in Northern Italy was said to be the main driver for this. Despite the higher sales, EBIT was negatively affected, having dropped from €6.7 million in 2010, to €4.8 million in 2011, and EBIT margin fell from 5.4 percent to 2.4 percent.

Partner Sales was most affected by the difficult market conditions, with sales decreasing from €58.9 million in 2010, to €40.3 million. EBIT also fell to €-2 million, down from €3.3 million.

S.A.G. Solarstrom believes that despite the difficult market, its Plant Operation and Services segment remained "gratifyingly stable" at €14.9 million, down slightly from the €15.3 million reaped in 2010. 2011 EBIT was also stable at €2.1 million (2010: €2.5 million). "The slight decline in margin to 14.2 percent (2010: 16.1 percent) is due to the specific international expansion of the Service area in new markets," added the company.

Having expanded its power plant portfolio to 26.1 MWp in 2011, S.A.G. Solarstrom’s Power Production business segment additionally showed positive growth. Sales "rose significantly" to €7 million, compared to €3 million in 2010. EBIT also increased to €1.3 million, up from €0.7 million.

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