Phoenix Solar's half-year revenue drops, operating loss narrows

German PV group Phoenix Solar AG posted a year-on-year decline in half-year revenue of 82% to €12.1 million due in large part to delays in planned order intake in the United States.

The company, based near Munich, narrowed its net loss by nearly 15% to €6.4 million and operating loss (before interest and tax) by 13% to €3.3 million. While revenue in the first quarter was in line with the company’s expectations, second-quarter figures and the first half year as a whole was below planning, the group said.

In view of the business development over the first six months, Phoenix Solar is now forecasting full-year revenue of between €70 million and €100 million, down considerably from the €141.2 million it achieved in 2013. Full-year operating earnings are expected to range between €0 and €3 million, which include proceeds from the sale of the group’s O&M business to German inverter maker SMA Solar Technology. The company said it would use proceeds of the deal, which will help improve its annual result over last year’s €1.4 million loss, to repay debt and strengthen its core operations.

The company attributed the decline in revenue to “significant delays in planned order intake” in the United States. Phoenix Solar achieved 86% of its overall revenue in foreign markets, which accounted for 79% of business last year, and 14% in Germany, down from 21% in 2013.

"The second quarter brought the recognition that we were unfortunately exposed to a series of external factors on which we have little influence,” said Phoenix Solar CEO Bernd Köhler. "All told, this resulted in the orders anticipated not being placed. Even though we find these delays very taxing, we are working hard on achieving our revised forecast over the remainder of the year based upon still existing extensive pipelines with several 100 MW’s worth of specific projects."

The group’s Components & Systems segment achieved first-half revenue of €8.1 million, down 81.9% year-on-year, but nevertheless accounting for 67.5% of total half-year sales. The Power Plants segment delivered revenue of €3.9 million, down dramatically from €23.7% in the first six months of 2013 and accounting for 32.% of total half-year sales.

Second-quarter revenue reached €5.5 million, down 85.5% year-on-year. The company made an operating loss of €1.1 million in the second quarter, down from a €400,000 profit.

Phoenix Solar’s consolidated order book position amounted to €17.1 million at the end of the first six months – a decline of €69.3 million compared last year’s figure. The international share of the order book position stood at €17.1 million, down from €80.5 million, but still made up 100% of total book orders.