Analyst Says SMA Hurt By Inverter Downturn But Positioned For Recovery In 2014


IHS analysts say SMA Solar Technology AG's poor financial performance this year is due to a sharp decline in the European photovoltaic market, growing competition and intense price pressure in its key market segments.

IHS predicts that the PV inverter market in Europe – which SMA's business had previously relied heavily on – will fall by almost 50% this year due to lower demand in many key markets – such as Germany and Italy – and average prices falling by as much as 20% in some segments.

‘The slowing European PV market impacts SMA Solar Technology's 2013 revenues and earnings, but it remains well placed to resume growth in 2014,’ says Sam Wilkinson, solar research manager at IHS.

IHS says that while SMA has been unable to grow its business outside Europe fast enough to avoid declining revenues this year, it has positioned itself effectively in key growth markets and is likely to be able to deliver on these growth projections for 2014. For example, the company has gained the leading position in the large three-phase inverter market in the U.S. and been one of the few Western suppliers to successfully enter the growing Japanese market.

IHS predicts that global PV inverter revenues will grow by 9% in 2014 and that the U.S. and Japan will account for 43% of global solar inverter revenues, making these essential regions for global suppliers to address.

The acquisition of Chinese supplier Zeversolar has also given SMA an enhanced presence in the rapidly expanding Chinese market, IHS says. The company may also be able to achieve traction in existing markets with a range of low-cost inverters. Other growth drivers for SMA in 2014 may be found in new products aimed at the PV energy storage, off-grid and diesel-hybrid markets, IHS says.

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