Phoenix Solar doubles Q1 revenue Y-o-Y

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Germany’s Phoenix Solar, which endured a difficult 2014 following the contraction of the German solar market, has posted first quarter revenue of €9.9 million ($11.4 million) following a solid start to 2016 driven by success in the markets of the U.S., the Middle East and Asia.

In Q1 2015 revenue for the firm was half that figure, at €4.9 million ($5.6 million), but what followed last year was three strong quarters during which time revenues tripled, with Phoenix Solar ending 2015 with revenue of more than $135 million.

Thus far in 2016, the conclusion of a series of large-scale solar projects has ensured a strong start to the year, with a suite of newly acquired projects entering their ramp-up phase and thus stimulating "accelerated revenue growth" forecasts for Q2, Phoenix Solar said in a statement.

The firm’s power plant segment was the key driver, delivering revenue of €8.8 million for Q1, accounting for 88.9% of business, while components and systems contributed 11.1%, or revenue of €1.1 million.

Gross profit margin, however, was 6.8%, down from 18% in Q1 2015 when the utilization of a warranty provision and the reversal of contingencies served to reduce the cost of materials and drive the high levels of profit. The more stable profit posted in 2016 was a result of the cost of one-off projects.

At the end of the first quarter, consolidated net losses for Phoenix Solar amounted to €-3.7 million, slightly higher than Q1 2015, but with an improvement year-on-year in Group EBIT, which was €-2.5 million, whereas last year it stood at €-2.6 million.

Cash flow has significantly improved, rising by more than €5 million over the year to reach €10 million by March 31. Looking ahead to the remainder of the year, Phoenix Solar expects revenue to reach between €180 million to €210 million, which would represent steady improvement on 2015.

"We continue to strengthen our base business and build professional capabilities in our three core markets: the U.S., Middle East and Asia Pacific, while managing costs carefully at the same time," said Phoenix Solar CEO Tim Ryan.