The announcement by the publicly traded company was made in the form
of a terse statement forwarded to the Comision Nacional del Mercado de Valores (CNMV), the regulatory body of the Spanish Stock Market, on August 31.
The company explained it intends to initiate a period of consultations on a downsizing plan that will affect 290 employees in the industrial component of its operations. The plan includes a timetable for meetings with labor leaders representing the workers involved, in order to negotiate certain elements.
Solaria said its industrial arm is one of the "principal lines of business, not only in Europe, but also on other continents," adding that it is exploring the possible installation of new industrial centers in those geographic zones where business and market opportunities are "more favourable".
Solarias net sales amounted to 23.41 million in the first half of 2012, down 55% from 51.64 million in 1H 2011, according to the companys half-year financial statement. Meanwhile, the company’s sales in the Spanish market slipped 46% to 9.03 million and exports dropped 59% to 14.38 million in the period between January and June 2012, compared to the same period last year.
Furthermore, sales of Solarias photovoltaic modules plummeted 67% from 25.68 million in the first 6 months of 2011, to 8.37 million in 1H 2012, while sales of projects effectively vanished, dropping from 13.22 million to zero.
The only bright light for the company during this period was the generation sector, where sales increased 16% from 12.41 million in 2011, to 14.38 million in 2012.
Solaria blames the slowdown in domestic demand on regulatory changes related to the approval of RD 1578/2008, which led to a slowdown in activity that affected the sale of photovoltaic modules and development of new turnkey projects. Solaria maintains that prospects remain favorable, although "few developers have initiated works or acquired photovoltaic modules". The reduction in tariffs and vulnerability of the sector to new legislative changes "could sustain the temporary uncertainty regarding the recovery of demand".
Established in 2002, Solaria Energía y Medio Ambiente is the sole company in the market that is publicly listed on the national stock exchange. It produces solar cells and photovoltaic modules in its production centers in Spain with an annual capacity of 250 MW.
It also develops turnkey installations for its own need or for other clients, operates and manages photovoltaic plants and generates electricity from solar energy plants built and operated in several European countries.